18/07/2017 World Business Report


18/07/2017

The latest business news with informed analysis from the world's financial centres.


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Now it's time for World Business Report.

:00:00.:00:17.

Netflix wows markets as it surges past 100 million subscribers,

:00:18.:00:21.

potentially sending shares to a record high.

:00:22.:00:26.

And would giving away one thousand euros a month to a person free them

:00:27.:00:30.

We discover how one bold start-up is finding the answer

:00:31.:00:34.

to the question of a Universal Basic Income.

:00:35.:00:46.

In a minute, we'll have an update on Rio Tinto's operations.

:00:47.:00:53.

The video streaming giant surprised investors overnight

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The company added 5.2 million subscribers in the past three

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months, boosting its global customer base to 104 million.

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It's a company whose growth reflects the changing culture of TV viewing

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Since its transformation from a DVD rental service to video streaming

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ten years ago, the firm's share price has rocketed from just over $3

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This year it will spend $6bn on content.

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That's 25% more than its rival Amazon is thought to be spending.

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It's all in an effort to lure viewers away

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Netflix has been aggressively expanding abroad, and says it is now

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But with one notable exception, China.

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In April, the firm agreed a deal to licence its content to one

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of China's biggest streaming sites which is controlled by Baidu.

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Our technology correspondent, Dave Lee, has more from Silicone

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Just about all of Netflix's money comes from its subscribers. It is no

:01:44.:02:14.

wonder when the company updates people on how it is performing,

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people look at the user growth column to see how it is going on. In

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the last quarter, they added 5.2 million new subscribers, a lot more

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than analysts ever expected. Most of that has come from overseas were

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Netflix has been investing in non- English programming and huge

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marketing to spread the word about what they do. They have done well in

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the US where they added 1 million subscribers in the last three

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months, almost double what was expected of the company. Netflix now

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has more than 100 million subscribers around the world, making

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it the leader of the pack in the video streaming market. That can be

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attributed to original shows like house of cards and oranges new

:02:58.:03:08.

black, attracting new subscribers. They need to have more shows to

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continue that, and they will spend $6 billion this year to do just

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that. Joining me is my guest. Thank you

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for coming in in. Netflix has been so successful. More than 5 million

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subscribers in the last three months, beating expectations. How

:03:31.:03:36.

are they doing it? Investing in new content and building a great

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service. They had 30 million just a few years ago, now they have more

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than 100 million. It is all about investing. We looked at some of the

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figures and sought revenue for the quarter was almost $3 billion. 2.8.

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They are investing a lot more than they are making. They are investing

:03:57.:04:01.

a lot into acquiring content. They are not making much on the bottom

:04:02.:04:07.

line. They are spending money on cash to get content and are actually

:04:08.:04:10.

losing cash every single quarter. They have the expectation they can

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double their subscriber base to 2 million. -- 200 million. What will

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it mean? 50- 30% profit margin is all the way down to the bottom. If

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you double that base, it is roughly the same. That will drop to the

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bottom line. That is the theory. We mentioned China and Baidu. It is a

:04:33.:04:40.

market Netflix wants to get into. That is scheduled for April. If it

:04:41.:04:43.

is successful, what could that mean? There are 7 million people in China

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alone. They have 20 million subscribers. It is a big market.

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Netflix is going in through the backdoor. Netflix has not released

:05:00.:05:12.

how much of a cart they would get by licensing to Baidu they would get.

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-- cut. They also have Hollywood quite concerned. They have become

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frenemies. On the one hand they are finding these things, and on the

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other hand they are competing. They released a movie with Brad Pitt,

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both in the movie theatre and at home. It's got banned from Cannes

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this year because they are making films no one wants because they are

:05:41.:05:46.

not actually a movie. They don't go to theatres, they go straight to

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Netflix. Cannes wanted to limit that has a contestant. OK. Thank you very

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much for your time. It's one of the richest

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countries on Earth, But Germany has some systemic

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problems, including an ageing population, and a lack

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of entrepreneurship. Now, one radical start-up is setting

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out to change all that, by handing out a basic income

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of 1000 euros a month to dozens of total strangers, with the hope

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that it will liberate them Joe Miller reports from Karlsbad

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in south-west Germany. When this boy was born, neither of

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his parents were able to work. TRANSLATION: I was studying and my

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boyfriend came from Mali so neither of us could work. When our child

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arrived, we had such big money problems We were wondering what we

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could do. This was a possibility, the only one. Three months later, he

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became the sole breadwinner, thanks to a radical experiment. The child

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is one of almost 100 randomly selected people across Germany

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receiving a basic income of 1000 euros a month for a year. Thousands

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are queueing up to be the next recipients. Every few weeks, one

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gets chosen by raffle, sometimes on prime time German TV. The initiative

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is the brainchild of just one young entrepreneur. Ten years ago I

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started my own on line business. After a few years of hard work, it

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started to work on its own and has changed my life dramatically. I

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wanted to find out if it could help other people. I started the crowd

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fund money over the Internet to raise money to give it to other

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people as a basic income for one year and see how it affects their

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lives. The idea of giving everyone a basic income is gaining in

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popularity around the globe, even winning the endorsement of

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Facebook's Mark Zuckerberg. With election is looming, a newlyformed

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political party is arguing prosperous Germany should introduce

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the policy as well. 25% of workers are working in this sector. Basic

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income would help them a lot, along with society. There is a lot of

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stigma around poor people which could be resolved. We would foster

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solidarity in society. Valerie has managed to find employment as an

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interior designer. His dad has learnt German and works locally as

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well. By the time he grows up, the experiment of his childhood might

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just become policy. BBC News. Tesla has added two independent

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directors to its board, including the boss of 21st

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Century Fox, James Murdoch. The appointments increase the board

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size at the electric car and storage The move comes amid criticism

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by some shareholders of a lack Some investors believe that too

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many of the company's board members have personal or professional

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ties to boss Elon Musk. BNP Paribas is the latest in a long

:09:00.:09:01.

line of banks to be hit The French bank has just been handed

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a whopping $246 million dollar fine It's the latest punishment

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for traders who allegedly shared information about currency bids

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without adequate oversight The scandal has led to billions

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of dollars in fines on both sides of the Atlantic, having already hit

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the likes of Barclays, RBS, Deutsche Bank,

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UBS and JP Morgan Chase Before we go, a quick look at what

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the markets have been up to. You can see the figures in the Asian

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markets. We have the FTSE. The Nikkei has opened after a public

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holiday yesterday. Lots of markets reacting to China's figures

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yesterday. You can get in touch with me on Twitter.

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