tv BBC Business Live BBC News February 27, 2018 8:30am-9:01am GMT
this is business live from bbc news with sally bundock and ben thompson. stopping the sales. the eu looks at how it can prevent foreign takeovers it doesn't like. live from london, that's our top story on tuesday the 27th of february. protectionism or keeping crucial assets in—house? europe is deciding on its actions in the face of growing investment from china. eu ministers are meeting in bulgaria. we'll tell you all you need to know. also in the programme. the sky's the limit. us cable tv giant comcast makes a $30 billion bid for rupert murdoch's european tv operation. and the trading day has just begun in europe. this is how the main markets are faring. the new fed chairjerome powell is speaking in washington today.
and how and why do things go viral online? we meet one of the firms that says it can do it all for you — for a price. we'll get the inside track on the world of online marketing. today, we want to know do social media ads reel you in or switch you off? let us know. just use the hashtag bbcbizlive. hello and welcome to business live. packed as usual so let's get started. does europe need to do more to protect itself from foreign takeovers? from german manufacuring to greek ports and uk data centres, there's growing concern about how to make sure investment doesn't cost know—how. and eu trade ministers are discussing this at their meeting in bulgaria today. foreign direct invesment into the eu
— that's when companies invest their money in foreign countries — came in at $370 billion last year. not all of it is considered uncontroversial. the president of the european commission jean—claude juncker said in september, "europe must always defend its strategic interests" such as technology, defence and infrastructure. one of the biggest deals to spark concern was the 2016 purchase of kuka, germany's largest maker of industrial robotics, by china's midea for $5.5 billion. and there is particular concern about companies linked to foreign governments. as china looks increasingly overseas at technology and manufacturing interests, its investors spent a record $15 billion on eu purchases in 2016. that's almost double the previous year. just yesterday, germany's financial regulator said it would look into the $9 billion investment
in the car—maker daimler, which owns mercedes, by china's geely, which hopes to access damiler‘s technology. with me is miriam gonzalez, an expert on european trade law at dechert llp. thank you forjoining us. sally running through the details on what strikes me about this is about trying to decide which investments are welcomed and which are not and thatis are welcomed and which are not and that is the difficult thing, isn't it? some industries will say, "we need access to this intellectual property and technology", but then the government might say, "yes, but it's a crucial industry". how do you decide what is important? maybe but there are no new things in this proposal, the eu members, including the uk, by the way, carry on these
reviews significant foreign investment in certain sectors like nuclear energy, cyber security, financial services. this is something countries have been doing for a long time. it is done outside the eu regularly, the us have a particular mechanism and in australia, likewise, and in canada, they have investment reviews. these things have been happening for a long time. all the eu is doing is two things, one, to ensure there is more coordination and transparency between the different eu member states and something which is truly new is that the eu will have a say it's self whenever there is eu programme at stake and i think that is particularly in the area of energy where we will see the impact of that but there's nothing revolutionary in this. one of the particular concerns right now is the role china plays around the world. we know it is expanding its reach in all sorts of industries, particularly energy but also security and that is where there are
concerns about how closely linked to the state many of the chinese firms could be. yes, that is absolutely right but it is only in certain areas that are clearly defined that the eu member states are going to be doing this and what the eu commission and jean—claude juncker, who presented the proposal in september last year is telling them, what you are doing, we want to see more coordination and crucially more transparency. so the more transparent these processes are, the better for everybody. it is a system in the general international trade system, it is allowed to do something like this so there is no mystery in it. the us is particularly tough when it comes to vetting foreign investment, and also, as you've touched on, places like japan. is europe still seen as a bit ofa like japan. is europe still seen as a bit of a soft touch when it comes to foreign investment in that they can buy up crucial assets?” to foreign investment in that they can buy up crucial assets? i don't know whether a soft touch. i think
the fact we have the eu market as a whole and yet some of these reviews are being done at the national level opens up some possibilities that you may not find, for example, in the us between the federal, state and the estate themselves. there is a bit more of a gap but i don't think it says much as to how tough or not you may be. it is normal that there may be some skin purity with —— some security concerns, for example, on anything related to cyber security. provided you do the review in a transparent and accountable manner, i think that should be ok. the debate will run and run, i'm sure but for now, thank you. there could be a battle for control of the european pay—tv giant sky. in the last hour or so, us cable giant comcast has launched a $31 billion bid for company. that's despite rupert murdoch's 21st century fox already having agreed
a deal worth more than $25 billion for the 61% of sky it doesn't already own. 0ur correspondent theo leggett is in the business newsroom. this is interesting. i notice sky shares up 18% this morning. this is interesting. i notice sky shares up 1896 this morning. and the reason for that may well be that now 21st—ce ntu ry reason for that may well be that now 21st—century fox might have to improve its own offer in order to pull off the deal it really wants. this announcement has really throwing the cat among the pigeons. basically, pitting three of the world's biggest media giants against each other. on the one hand, you have 2ist each other. on the one hand, you have 21st to three fox which wants to buy their share of sky it does not already own. that would be part ofa not already own. that would be part of a package sold onto the walt disney company which wants to buy 21st—ce ntu ry disney company which wants to buy 21st—century fox‘s film and tv assets and on the other hand, comcast, which has come in with a surprise, all—cash offer, which it saysis surprise, all—cash offer, which it says is superior to what sky is
offering and comcast says it wants to ta ke offering and comcast says it wants to take control of sky because it wa nts to to take control of sky because it wants to expand internationally. it says it would be happy to share ownership with the walt disney company but only if it has more than 50%, in other words, company but only if it has more than 50%, in otherwords, only company but only if it has more than 50%, in other words, only if it has full control and maybe walt disney would not be particularly happy with that. what we are going to see now isa that. what we are going to see now is a whole lot more toing and froing and potentially higher bids as well. interesting as well because from rupert murdoch's perspective, this is another spanner in the works. he's been desperate to acquire the remainder of sky for some time. yes and he's been stymied for a long time by regulators in britain who are concerned he was acquiring too much influence in the british media. yeah, it's going to be interesting to see what happens. thank you for joining us. we will keep you right across that story as we get more on it this morning. let's take a look at some of the other stories making the news. the uk's minister for international trade is set to argue that any form of customs union with the eu after brexit would be a complete sell—out. liam fox is expected to say having eu limits on doing other deals would make the uk less attractive.
0n on monday, the leader of the labour opposition argued that staying in a customs union would be best for britain. pre—tax profits at standard chartered have jumped to $2.11 billion over the past year, after a period of painful restructuring. despite surviving the financial crisis relatively unscathed, the bank struggled when commodity prices later crashed. the firm makes the bulk of its revenue in asia. south africa's former finance minister nhlanhla nene has been re—appointed to the post by the country's new president cyril ramaphosa. mr nene was controversially sacked two years ago. in a wide—ranging reshuffle, the new president has ousted several former allies of jacob zuma. he's called it a new dawn for the country. china's top economic advisor will visit the us today to talk about trade, a tricky subject between the two countries.
us trade officials recently threatened to impose a tariff on steel imports, leading to threats of retaliation from china. sarah toms is in singapore to tell us how significant this is. we have heard from both sides come if you impose tariffs, we will do the same but it's just ratcheting up the same but it's just ratcheting up the pressure, isn't it? absolutely but this is actually pretty significant. china's top economic adviser shows that china is taking the mounting trade tensions with the us very seriously. mr lu is seen as a close ally to xi jinping and it is likely the trusted deputy on a mission to lobby the us and restart trade talks. as you said, there are a couple of problems between the us and china at the moment. the first is, there's an investigation into whether chinese companies have infringed intellectual property
rights. mr trump must make a decision in the next few weeks. secondly, it has got a problem with the chinese steel imported into the us, as you mentioned. that comes after ta riffs us, as you mentioned. that comes after tariffs were slapped on solar panels. it is not clear who mr lu will meet in washington and we don't know if the talks will be successful until the us makes a decision on day trade issues. thanks, sarah. we will keep an eye on how he gets on in the us. let's take a quick look at the asian markets. japan closing up over i% japan closing up over 1% higher again, and hong kong, spoiling the party a little bit. that is the night before in the us. moving on to europe, in the us on wall street, we saw shares moving up to a four week high, and in europe right now, markets across the board doing well, sky shares as we have mentioned up some 18%, liam fox speaking today, we have mentioned that as well so keep an eye on the pound and the
euro for reaction to what he says. in terms of wall street, let's go to new york and find out what is on the agenda there. ever sincejerome powell ever since jerome powell took ever sincejerome powell took over as chair of the federal reserve earlier this month, markets have been extremely volatile. he is not to blame. it is because of speculation about the pace of interest rate rises in the us thanks to strong economic data but certainly, that timing —— bad timing for mr powell. 0n certainly, that timing —— bad timing for mr powell. on tuesday he will present his first—ever semiannual report to the house financial services committee and is sure to be grilled by lawmakers. wall street will be watching with bated breath. department store chain macy's will report fourth—quarter results. last month the company announced it was cutting thousands of jobs month the company announced it was cutting thousands ofjobs as it struggles to compete with e—commerce firms. and in a case which could have wider implications, the us supreme court will decide whether microsoft needs to turnover data stored overseas to prosecutors in
america in a drug trafficking investigation. joining us is maike currie, investment director, fidelity international. good morning. let's pick up on the us theme because if you look at the numbers now come you would be forgiven for thinking one of the volatility over the last couple of weeks was never there, we're back up to the levels of before. we are, the us markets as recouped a lot of losses. all eyes onjerome powell. this is his chance to draw a line in the sand between him and his predecessor, janet yellen. but of course, she did a very good job on reassuring markets, navigating the path towards monetary normalisation. the big question investors will be looking for and scrutinising is whether the us will have four interest—rate rises this year. we know three are on the cards but if there could be another one. quickly, i want to get your take on the changes in south africa. you are
from there, cyril roma poser announcing late last night a brand—new cabinet with a new finance minister, your thoughts? i'm very positive, i think mr nene is right for thejob. cyril positive, i think mr nene is right for the job. cyril ramaphosa for thejob. cyril ramaphosa is a businessman, we need him to bring about the change, economic growth was nonexistent underjacob zuma and unimportant at record highs so very positive for the country and of course a lot of companies are dual listed on thejohannesburg stock exchange and the ftse 100 listed on thejohannesburg stock exchange and the ftse100 and those companies like old mutual and anglo—american has benefited from the regime change. we will keep a close eye on it. for now, thank you. still to come... is that must—watch video really going viral — orjust some clever marketing from big business? we'll meet one of the firms that promises views, likes and clicks — for a price. you're with business live from bbc news. first, let's talk about the great
northern exhibition, which promises to exhibit great art and innovation from the north. steph is in gateshead to find out what is planned. hello, today they are launching the great exhibition. in the summer for 80 days across the region there will be various events celebrating the art, culture and history of the whole of the north region. it is about inspiring the next generation of people to come up with future innovations, but it is also about celebrating the past as well. one of the things that is part of it is a water sculpture. that will run along the time in gateshead, it separates newcastle from gateshead. there is a lot more to it as well. you are the
executive director, tell us a bit more. we have got a great example of things we are showcasing in lego and some things from the beatles to grapheme, we are also creating a virtual reality rocket. we have an amazing, new 21st—century transport port that will get you from scotland to manchester in ten minutes. the great north run. we are also encouraging young people to be inspired and create their own inventions. and we have got this d riverless inventions. and we have got this driverless car. hello. it is a car you can sleep in. something for the future. there is a competition running as well which will see a lot of little inventors. some of them are here. they have come up with some great ideas about life in 2030. a lot going on to celebrate and even
in the background we have got a wonderful choir and band. hello! in the background we have got a wonderful choirand band. hello! i will leave them to play us out. you get it all on this programme. it is all happening out there today. 0ur it is all happening out there today. our business life page has the latest on one of my favourite subjects, pasties, pies and food. profits up at greggs, but they were down at the end of last year. you're watching business live. our top story: eu trade ministers are meeting in bulgaria to work out what they can do to stop foreign takeovers they don't like. there's growing concern about companies with government links buying companies just to access their technology. some particular criticism has been
levelled at many chinese firms and they deny that. a quick look at how markets are faring.. sky and shares are up 18% with the news that comcast is making a play for sky, which sparks a whole new story in that. that is all on our website. the chances are we will be talking about that for the rest of the week. in other news: in companies are forever trying to come up with ways to drum up sales or increase clicks and views online. and the best way to get a brand or product to viral is via social media. but according to our next guest, things don'tjust go viral by luck. there's a whole industry behind it, which two young british entrepreneurs have built a business around. social chain is a social marketing agency and social media publishing house. it owns and runs hundreds of popular social media accounts covering sport, video games, fitness and food — which have millions of young followers. established by two then—students in 2014, the company has grown
from just five staff two years ago, to over 200 today. and has an annual turnover of over $12.5 million dollars. thatis that is £9 million. joining us is steve bartlett, co—founder and chief executive of social media marketing agency, social chain. welcome. we have done a little bit, but explain in more detail how your company works. there 12 companies within company works. there i2 companies within the group and that is the media business which is called media chain, and then the marketing agency which takes all the things we have learnt from running these big global channels and works with the world's biggest brands to help them reach young people. explain how this began. this is about you spotting what people are genuinely interested
in. then finding out why people are watching and relating back to brands. how do you find those interesting things in the first place? i was an 18-year-old university dropout building a website and in doing so i became a marketeer as well. i had to find out how people came to my website. i had a couple of thousand pounds, but i needed a 1 million people for it to prove the concept. i tried taking ads out in newspapers and the conventional things and they did not work. it was not until i bought a small facebook page and posted my website there that people came. i doubled down on that and i found myself going around the world meeting every person i could who had built a big social media channels in their bedrooms. they all happen to be super young. i their bedrooms. they all happen to be superyoung. i met their bedrooms. they all happen to be super young. i met a 17—year—old kid who had 15 million followers who was running a fitness channel. we
all came together and acquired all those assets and a few years ago we started social chain. for companies who want to sell things, that is a gift for them and you are giving them access. we never meant to start marketing business or a media company, that was never our design. we were trying to figure out how to get people to come to our product. then i got a call from a big brand andi then i got a call from a big brand and i realised the website i was building was less effective than the social media site. six or seven yea rs social media site. six or seven years ago nobody would have considered posting a brand on a social media page. how do you make money from all of this? from the media side brands will come to us, we have 370 million followers across different niche is, sports, food, parenting, and they will come to ask if they want to appear on these slots. 0n the marketing side they will come to ask if they want challengers to solve. they might be
working out how to use social media to get them to check them out. what i don't get is if there is a good bit of content, a funny video, a cute video of a cat, i can see how that might go viral. but if i am a brand and! that might go viral. but if i am a brand and i come to you with a corporate video and i wanted to go viral, how do you make people watch content that they don't want to watch? we might say no. we say no much more than we say yes. when it comes to our own video service we note in the audience is we gave them content and made them feel that the content and made them feel that the content they cared about was what they wanted. if it was tough to talk about, ourjob they wanted. if it was tough to talk about, our job is they wanted. if it was tough to talk about, ourjob is to try and find the story in the brand that will resonate with our audience. it is like making movies. we are trying to make content that will entertain and
make content that will entertain and make people feel something and if they do, they will earn a share of they do, they will earn a share of the brand's life. briefly, we are out of time. do you feel a responsibility when it comes to your audience? 10096. we will never speak to our audience that will make them feel inadequate orally to addictions. we have a strong ethical code and with power comes responsibility. thank you for coming in. absolutely fascinating. absolutely fascinating. china's huawei is the world's third biggest smartphone maker but it's having big problems trying to sell its handsets in the world's biggest economy, the united states. the company's mobile boss has told our correspondent rory cellan—jones it's because of commercial reasons and us security concerns are misplaced. every year we have strong growth, every year. we have the chance to be the number one, maybe not far away. do you really think one day you could be number one? yes. global smartphones? for sure. we have a chance.
now, one of the problems for you in achieving that is trying to get into the us market. you are nowhere in the us market because american politicians don't trust you. why do you think that is? because, you know, some guy, some political things trying to keep us out because we are too competitive but we have leading technology, leading innovations. they worry about that. we're too strong. is that why american politicians want to keep you out because you're too competitive or because they worry you are too close to the chinese government? they are trying to say that but actually we are an independent company. they are trying to use kind of political things to keep us out. an interesting conversation. you have rejoined us to talk about some of the stories in the papers. we are
asking people related to our previous guest about social media ads and whether they are turned on or turn off. have you ever bought anything from an advert on social media? no. i think anything from an advert on social media? no. ithink the anything from an advert on social media? no. i think the whole point of social media was to connect with people you have not seen in a long time or people who share common interests with you and adverts are a distraction and they are an invasion of privacy because they look at what you are browsing. i have never bought anything. luke says the same, iam not bought anything. luke says the same, i am not interested in the slightest. ian says, if they are about things i am interested in i don't mind. good content is far more powerful than advertising. the world has changed. time is tight, but really nice to see you this morning. thank you for your company, we will see you tomorrow. good morning. it has been a bitterly
cold start to the day, temperatures well below freezing this morning and many of us waking up to a covering of snow, in particular in the north east of england where that snow has moved in over night, pushing its way from the pennines to manchester and north wales. down towards the south east further snow showers moving in here. the met office has this amber weather warning, the first in the south—east corner. further heavy snow showers will pile in. more snow in the north east into the pennines, locally up to 15 centimetres in those amber warning areas. but the snow in the north—west of england and wales will gradually ease off. there could still be wintry flurries in eastern parts of england and eastern scotland today. further west a bit drier, but a cold day. these
are maximum temperature is at best. tonight heavy snow showers moving in across eastern parts of england into eastern and central areas of scotla nd eastern and central areas of scotland by the early hours of wednesday morning. again, a very cold night and temperatures down to minus fourand minus cold night and temperatures down to minus four and minus eight degrees. 0n minus four and minus eight degrees. on wednesday morning the focus of the snow will be across the north east of england, made scotland up into the north east, 5—10 centimetres, perhaps more, expected on wednesday. that could lead to problems here throughout the day. elsewhere, some snow showers in the east, but not as many compared to today. there could be a flurry in north wales and north—west england. but with a stronger wind it will feel bitterly cold. temperatures not much above freezing. factor in the winter chill and it could be down to
-10 winter chill and it could be down to —10 degrees. a severe wind—chill. through wednesday night the snow across scotland continues in the central belt. eventually we will see some snow moving its way into southern areas on thursday. it is all linked into this area of low pressure which has been named by the portuguese met as emma. it will bring snow in many southern parts of england, through wales and up into northern parts of england. worth staying tuned to the forecast. hello, it's tuesday, it's 9 o'clock, i'm victoria derbyshire, welcome to the programme. our top story today: just one centimetre of snow in parts of the south east of england, yet it's still causing traffic chaos, with hundreds of trains cancelled and many schools closed. i have to go to work tomorrow. my wife has to go to work. so if one of us has to call in sick, we lose the money so hopefully the school will be open. we've waited for snow
for three years. i'm desperate for it to snow! in northumberland, there's been eight centimetres of snow. we'll bring you the picture from right around the country. also on the programme: we can reveal that facebook have funded a project using their own messenger app to try to deradicalise extremists. it's never going to be enough simply to take down content because there will always be either grey areas, or more importantly, there will be people who are tempted and interested in that path,