02/03/2017 World Business Report


02/03/2017

Similar Content

Browse content similar to 02/03/2017. Check below for episodes and series from the same categories and more!

Transcript


LineFromTo

Now for the latest financial news with Sally

:00:00.:00:00.

Investors scramble for Snapchat, in the biggest tech flotation

:00:00.:00:23.

But is the app a cash cow or just a craze?

:00:24.:00:27.

the boss tells us his plans for the internet TV giant

:00:28.:00:32.

as it heads towards 100 million users.

:00:33.:00:40.

Also in the programme: Up up and away -

:00:41.:00:46.

the US markets blast through previous record highs,

:00:47.:00:48.

the global rally is continuing in Asia.

:00:49.:00:52.

We start on Wall Street where investors are gearing up

:00:53.:01:02.

for what could be the biggest and certainly the most hyped

:01:03.:01:05.

technology flotation since Twitter in back 2013 -

:01:06.:01:07.

In a few hours time shares in SNAP- the owner of photo messaging app

:01:08.:01:14.

Snapchat - will begin trading on the New York Stock Exchange.

:01:15.:01:17.

The big question - will it end up a stock market giant

:01:18.:01:20.

like Facebook or, like Twitter, a bit of a flop?

:01:21.:01:23.

The flotation has been hugely oversubscribed -

:01:24.:01:26.

there were as many as ten orders for every share.

:01:27.:01:29.

That's allowed Snapchat to up the price.

:01:30.:01:32.

Late on Wednesday it priced its shares at $17 -

:01:33.:01:35.

above the $14-to-$16 range it had previously indicated.

:01:36.:01:40.

That will give the company an opening valuation of $24 billion.

:01:41.:01:44.

More than twice as much as Twitter at its current share price.

:01:45.:01:48.

That's despite a couple of major worries -

:01:49.:01:51.

Firstly, Snapchat has yet to turn a profit.

:01:52.:01:55.

In fact it lost over half a billion dollars last year alone.

:01:56.:02:01.

Plus shareholders who buy in will not have any voting rights.

:02:02.:02:06.

The founders of the company will retain complete control

:02:07.:02:08.

They are incredibly young and, as of later today,

:02:09.:02:14.

Evan Spiegel and Bobby Murphy - both in their 20s -

:02:15.:02:21.

will be worth around $4 billion each.

:02:22.:02:26.

From New York, here's Samira Hussain.

:02:27.:02:32.

In just five years, Snapchat has gone from a little at created by a

:02:33.:02:42.

couple of college kids to a virtual Giant with 160 million daily

:02:43.:02:47.

activities users. On Thursday it will start trading here on the New

:02:48.:02:53.

York stock exchanges. Why are investors so excited about a company

:02:54.:02:59.

valued at $20 billion but has yet to make a profit? They are hoping it

:03:00.:03:04.

will see the same success as companies like Google or Facebook.

:03:05.:03:10.

Of course, the worry is that they will end up looking more like

:03:11.:03:14.

Twitter, companies that came with a lot of hype but not much chance. It

:03:15.:03:21.

is a new breed of social networking. It is not like Facebook where there

:03:22.:03:27.

is a big public wall with your family on there, it is not like

:03:28.:03:32.

Twitter broadcasting to the whole world. If you are of a child

:03:33.:03:37.

completely at the did to this product you might very well see it

:03:38.:03:43.

has a future. I did not use it. I have it but I do not use it. I use

:03:44.:03:51.

it every day. My kids use it. I use it all the time. I do not know what

:03:52.:03:59.

it is and I did not use it. Snapchat is the talk of Wall Street even

:04:00.:04:04.

though it is geared towards teenagers but that is the key

:04:05.:04:10.

towards its success. If it cannot attract its young users, it risks

:04:11.:04:17.

becoming just another tech company that group two big too fast.

:04:18.:04:21.

James Erskine is Director of the social media consultancy-

:04:22.:04:23.

We have arrived after so much hype. There are questions about this

:04:24.:04:39.

company and its future. What is your take? We will be talking about this

:04:40.:04:45.

company as a great success? It is closer to Facebook than Twitter- 160

:04:46.:04:54.

million users daily sounds like an awful lot. The Rat stakeholders, the

:04:55.:05:01.

users, they know it is a photo and video sharing social network and

:05:02.:05:08.

that is exciting. A bit of disconnect between them and the

:05:09.:05:13.

investors. Investors are kind of uninsured. It was rendered as a

:05:14.:05:21.

camera company in 2016. That to me sounds quite this are, at the moment

:05:22.:05:27.

it is saying they have more stuff coming and new toys coming in the

:05:28.:05:34.

future? Similar perhaps the Google glasses, real-world products hard to

:05:35.:05:41.

get hold of... You sense that there are other things coming soon which

:05:42.:05:46.

will plan into a master, eager plan, perhaps. It does have advertising on

:05:47.:05:54.

the app. And is generating much income? About 90% generated comes

:05:55.:06:06.

from advertising. As part of your business, we look at different

:06:07.:06:09.

influences and how they engaged with different social networks and what

:06:10.:06:14.

Snapchat needs is to look at its products, it needs scalability and

:06:15.:06:22.

bigger brands. It needs to sort of shift in the way Facebook has in

:06:23.:06:28.

terms of getting many in from the advertisers. It has the people who

:06:29.:06:33.

use it, and it is the people advertisers want to grab hold of -

:06:34.:06:41.

the millennial is. My thought is it is about content. What content is on

:06:42.:06:47.

Snapchat that uses cannot find elsewhere. Fascinating. Thank you

:06:48.:06:54.

for coming in this morning and sharing your thoughts on Snapchat.

:06:55.:06:57.

The big event takes place later today and we will be all over it and

:06:58.:07:03.

then it will disappear... No, it won't.

:07:04.:07:05.

the internet TV streaming service has been growing fast

:07:06.:07:09.

and is on track to hit 100 million subscribers.

:07:10.:07:11.

But it's facing growing competition from other companies

:07:12.:07:14.

Co-founder and CEO Reed Hastings has been speaking

:07:15.:07:18.

to our Technology Correspondent Rory Cellan Jones

:07:19.:07:20.

at the Mobile World congress which is under way in Barcelona.

:07:21.:07:24.

It is just starting, we are getting more viewing on mobile and doing

:07:25.:07:33.

well on television but the key thing is being able to binge view and

:07:34.:07:40.

watch whenever you want. You need to keep adding these subscriber

:07:41.:07:44.

numbers, how will you continue because there must be a limit to the

:07:45.:07:49.

number of people who want to pay that much monthly? You chip have

:07:50.:07:54.

just announced they are doing a billion hours of viewing a day so

:07:55.:07:59.

considerably more than Netflix so there is lots of room to grow. But

:08:00.:08:08.

that is for free, YouTube. We will continue to invest in a great shows

:08:09.:08:12.

and people who will want to subscribe now 100 billion paying

:08:13.:08:20.

members. The big issue has been neutrality of net. You do not want

:08:21.:08:28.

that to be charged from other kinds of traffic. What are the prospects

:08:29.:08:33.

now that we have a Trump administration that is not seem

:08:34.:08:42.

friendly to that? Net neutrality has taken around the world as an

:08:43.:08:46.

assumption about the way the Internet should work. There are a

:08:47.:08:51.

lot of countries that do not have a law but we still operate very much

:08:52.:08:57.

along those principles. What would your message to Trump the? I think

:08:58.:09:04.

net neutrality is important so none of the voices are censored and there

:09:05.:09:10.

is inequality around. Facebook seems interested in doing a lot more

:09:11.:09:15.

video. That would be quite a danger to you? And there is YouTube read

:09:16.:09:23.

which is a subscription service, potentially Apple, Amazon on, a lot

:09:24.:09:29.

of competition, rate for the consumer and challenging Fort

:09:30.:09:35.

Netflix but there is also a lot of room to grow. But we challenge and

:09:36.:09:41.

also excitement. The Dow Jones closes above 21,000.

:09:42.:10:00.

It makes this the fastest rise since 1999. Shares in banks have been

:10:01.:10:05.

climbing since President Trump's election victory. He has promised to

:10:06.:10:09.

cut regulation on Wall Street as well as reducing taxes and

:10:10.:10:18.

implementing infrastructure programmes. You can see the price of

:10:19.:10:26.

oil has fallen as well. A weaker yen is also helping. Rates rise possible

:10:27.:10:36.

in March and many believe it is feeling these numbers. When will it

:10:37.:10:40.

end? We will see you soon. MPs say that the government's

:10:41.:10:49.

delayed 25-year plan for improving England's

:10:50.:10:51.

natural spaces should The government promised

:10:52.:10:52.

in its manifesto that it would restore damaged

:10:53.:10:56.

wildlife habitats and leave them in a better

:10:57.:10:58.

state than before, but MPs want to see how

:10:59.:11:01.

they propose to do it.

:11:02.:11:05.

Download Subtitles

SRT

ASS