tv BBC Business Live BBC News January 23, 2017 8:30am-9:01am GMT
this is business live from bbc news with sally bundock and aaron heslehurst. samsung confirms the note 7 smartphone disaster was caused by faulty batteries. the overheating devices have cost it more than $5 billion and huge damage to its reputation. live from london, that's our top story on monday the 23rd of january. the world's biggest smartphone maker also says its next big phone launch won't happen next month as expected. we'll ask how long the damage will last. also in the programme: the boss of taiwan's foxconn — which is based in taiwan — confirms he's considering a multibillion dollarfactory investment in donald trump's america.
and all of the key markets are down by nearly 1%. why such a bad start to the trading week? we talk you through the winners and losers. and we'll be getting the inside track on baby food. it's a huge market worth $53 billion. and we're speaking to the mum who couldn't find what she wanted in the shops, so she started her own organic business. and we want to hear from you today — do you still trust samsung? the 58 will be out soon. would you buy another samsung phone? let us know. welcome to the programme. the start of a new business week. do get in touch, whether it is about
samsung, baby food or any the other stories. let's start in south korea. korean electronics giant samsung has released the results of its investigation into its flagship galaxy note 7 smartphones. in october last year the phones were recalled because some had overheated and caught fire. the pictures were all over social media. the company today confirmed problems with the design, saying the manufacturing of batteries was to blame — not the actual phones. the note 7 was supposed to rival apple's iphone 7, but instead, the device caused massive damage to the compa ny‘s profits and its brand. last year, more than 100 of the phones spontaneously burst into flames. this forced samsung to halt production and recall millions globally, months before the all important christmas sales period. the debacle almost entirely wiped out the company's mobile business profit in the third quarter of last year — which is one of samsung's core businesses.
and this dragged total profits at the company down by 30%, to their lowest level in two years. but it didn't end there. samsung itself predicted another $3 billion could be wiped off profits over the next two quarters. the total cost of the recall has been estimated at around $5.3billion, but the damage to the company's brand could prove harder to predict. gareth beavis, mobile editor of the website tech radar, is with me now. gareth, i saw this confirmation this morning and said, really, you've got to be kidding us? of course it was the battery. how important is this
confirmation? does it draw a line? we really drew a line when samsung withdrew the phone and said, we can't buy it any more. to draw a line and say, we got that problem under control, we don't need to worry. the new phone is the $8. a p pa re ntly worry. the new phone is the $8. apparently it is delayed a little bit. i think it was going to be feathery. i think it might be much now. is this samsung just taking its time to make sure they get this spot on? the chances of a phone having the production issues samsung have had a pretty into tessa munt. usually they happen in february. —— into tessa munt. they could say, everything is fine.
they could say, everything is fine. they are putting more health checks on top of it. everybody is trying to assess how damaging this will be for some song. will smartphone users be loyal? wildie stick with this company despite the fact they had to send back the note 7? people are still wary. it will always have a halo effect. people are still a little bit fickle. if the 58 is a success , little bit fickle. if the 58 is a success, it will soon forget. people don't want to miss out on having a good phone for a good price. presumably samsung will have to spend a lot of modern —— money on marketing? they have to convince us that things are ok again. absolutely. they already spend money on marketing. you will see a subtle change in marketing. you will see things about safety around the help of the products. make sure everybody understands this is a solid and sta ble understands this is a solid and stable product. thank you for coming
in. we have already got some tweets. we will do them later. it's a bit of a mixed bag. stop giving me your scripts! the other stories making headlines around the world. opec and other oil producing countries have agreed a way to monitor that all parties stick to the historic supply deal struck last months. the countries have already cut oil supply by 1.5 million barrels a day. that is 80 % of the agreed target. the deal came after two years of oversupply led to dramatic drops in prices. saudi basic industries have agreed to die —— to buy royal dutch shell's sta ke. to die —— to buy royal dutch shell's stake. the middle east's biggest petrochemical bridges and shell are ending their partnership earlier than planned, it was supposed to be in 2020. in 2018, shell ended plans
to build a plant in qatar. last year they entered and natural gas adventure in abu dhabi. us president donald trump has said that he will soon begin renegotiating the north american free trade agreement with his canadian and mexican counterparts. meetings have been scheduled with canadian prime ministerjustin trudeau and mexican president enrique pena nieto, he said. the nafta agreement came into effect between the three countries “119911. mr trump has called it the worst trade deal the us has ever signed. i have to say, he is all over this next story. he is everywhere. he is the gift that keeps on giving. the taiwan—based company that puts apple's phones together — mainly in chinese factories — suggested it will invest as much as $7 billion in new manufacturing plants in the united states. pretty amazing story.
the comments from foxconn‘s chief executive terry gou are likely to be welcome by new us president donald trump who has warned of tariffs to help encourage manufacturing jobs back into the country. leisha chi is in singapore. we both think this is an amazing story. a taiwanese company actually going to go to the united states and build a plant. good news for trump. aren't there are rumours that this is apple who pay the money?” aren't there are rumours that this is apple who pay the money? i will get to do is paying in a second. if this plant does materialise for the us. it would be a major —ish —— victory for donald trump, who has pledged to bring black —— back all of thejobs pledged to bring black —— back all of the jobs lost to asia, back home.
fox con is the biggest electronics maker. this plant in the us will maker. this plant in the us will make display panels, which is critical to these smartphone and ipad devices. it's said this move could create between 30000 and 50,000 jobs in the united states. that is a very large number. pennsylvania is the current frontrunner as a location of this new plant. but they are also in discussions with other states. as we have been reporting, donald trump has been agitating against china and fox con is one of china's biggest employers. this would be a major move, obviously. it is interesting, the comments about how manyjobs could be created. the large —— the last time we saw footage of a factory in china there was hardly a
person to be seen. it was machines, it was automation making the stuff. that's right. this plant they are considering, they built sitting conjunction with... apple has not actually commented on the report. it does have a very big interest in them building a plant in america, because about half of fox con‘s revenue comes from apple. as to who much —— who puts how much money in, we will have to wait and see. fox c011 we will have to wait and see. fox con have said before they plan to replace most every human work a robot. we're still quite a long way away from having fully automated factories. i don't think it would be an immediate thing. thank you. lots of detail. let's have a look at how markets fared generally today in asia. the start of a new week. that
is friday's close for the us markets. friday was about the inauguration of donald trump. that dominated completely. today, quite a fall from the nikkei index. the dollar is down against most major currencies. there is a real deflation now that he is in thejob. some deflation perhaps felt on markets. let's look at europe and how it is going today. let's move onto the next screen. we can't. just to say, when i looked at them early... we have got them behind me 110w. early... we have got them behind me now. they are down by around about 196. now. they are down by around about 1%. why are we seeing falls in europe? aaron has someone who can give us and insight. joining us is kathleen brooks, research director for city index. this is markets waning a little bit,
kind of going... give us some details. walk the walk. from election day to inauguration day there has been a biggest —— the biggest rally in the us stock markets since any president. it is normal to have a ball back at this stage. the rally can't continue? it can't. stock markets are at a record high in the us. they are looking very expensive. can he continue the rally in the next four years? not sure. nor the markets are reacting how they are at the moment. he is talking lots but not about stuff thatis talking lots but not about stuff that is going to boost the economy. it is about moving an embassy from tel aviv to jerusalem, criticising the press etc. interesting that we
are getting this news about fox con. we are seeing american car—makers saying about production in the united states. i think that is going to bea united states. i think that is going to be a real positive, if we see more production onshore rather than reversing the tide of the offshore production. i think we've also got to remember that trump hasn't been universally good for stock markets. there are some c011 “— universally good for stock markets. there are some con —— companies, boeing, for example, one rogue tweet can knock billions off their share price. markets liked what he was saying but now is the time frame to deliver the russia —— the russian executive orders we have seen at the weekend... if we don't see the rollback of financial regulation, that could be a problem. swiftly switching, i want to talk about the worst performing currency and the world, the turkish lira. they are expected to raise interest rates,
which is interesting. they have had a lot of pressure from president erred again to cut interest rates to boost the economy. however, the currency, it has really taken a bashing in the last few months since the two last year. they need to hike interest rates to stem that that line. we will see whether or not an increase in the benchmark rate is expected. they will have to do more than that. here is an economy that has been hammered. you talk about the coup, the terrorist bombs, dropping tourism... absolutely. this is just boosting inflation, dropping tourism... absolutely. this isjust boosting inflation, the dropping tourism... absolutely. this is just boosting inflation, the fall in the year as well. thank you for coming in. still to come: it's estimated to be worth over $50 billion. we get the inside track on the global baby food industry after the break. you're with business live from bbc news. the prime minister will today unveil the government's vision of a more interventionist,
industrial strategy for britain. theresa may will launch the plans at her first regional cabinet meeting which is happening in the north west of england. ben thompson is at a fuel processing plant in warrington to see what this could mean for business. so it depends on what she says business though, ben, hoping it is all good stuff obviously? yes, good morning to you both. welcome to warrington and it does depend who you speak to because we have been speaking to business all morning and some saying help for business very welcome, but others saying governmentjust welcome, but others saying government just leave it welcome, but others saying governmentjust leave it to us. we can cope without much intervention. we are at this oil processing plant. it comes in as this so—called base oil and this is how it ends up. this is the finished product. you will probably be used to stuff like this
on the shelf. this place is interesting because it really tells a story about what we will hear from theresa may later, because it is not just about investing in hard infrastructure, roads and railways and internet connections, but in research and development. if you ta ke research and development. if you take a look at this, this is a brand—new £3 million head office, u psta i rs brand—new £3 million head office, upstairs will be the offices, but downstairs is the big research and development labs where they will come up with new and more efficient ways of doing what they do here, that's what will be important. as you can see behind me, the truck there, that's also important because without spending on infrastructure and the roads and the railways well frankly those trucks won't be able to get around. so what we'll hear from theresa may slaer this ten—point plan. it is a ten—point plan to get business working again and the prime minister says she wa nts all and the prime minister says she wants all people wherever they live
in the country, from all corners of the country to feel the benefits of economic growth. she will layout the plan later and it includes support for local business groups, support for local business groups, support for research and development and training, but crucially, also for that so—called hard infrastructure, the roads and the railways and the internet connections. so we will hear from internet connections. so we will hearfrom here. her. there will be full coverage on bbc news. thank you very much indeed, ben thompson up north for us today. he is at an oil and lubricant factory. you're watching business live. our top story: the world's biggest smartphone maker samsung confirm faulty batteries were to blame for the note 7 burning phone disaster. it was the battery. the south korean firm also says its next big smart phone launch has been delayed. a quick look at how
markets are faring. now, the global market for baby food has become big business in recent years and our next guest, cat gazzoli founded her company piccolo two years ago hoping to get in on the action. baby food accounted for over $53 billion around the world in 2015. better income levels, rising awareness about the benefits of organic products, means the natural food segment is gaining popularity, growing at 12% a year. sta rt—up piccolo launched in april last year, and has already seen its first year sales targets five —fold. the company focuses on food made from the so—called mediterranean diet involving high consumption of olive oil, fruits and vegetables
and low consumption of meat. cat gazzoli, founder and ceo of piccolo. cat is with us. great to have you with us cat and you have some of the satchels here. are you going to try them? maybe. i challenge you to try them? maybe. i challenge you to try the baby food. there is one i want to try, spaghetti or something. you went out to buy food and you go, "i don't like what's available." so you start your own company? even before that because i was working with the nct. that's? the national childbirth, the largest charity supporting parents in the uk in their first 1,000 supporting parents in the uk in theirfirst1,000 days. all supporting parents in the uk in their first 1,000 days. all those yea rs i their first 1,000 days. all those years i was saying to british pa rents years i was saying to british parents what they were missing in the market and lot of that involved 100% vegetable brands which piccolo launched and moving up the category
so launched and moving up the category so they had the special blends. you're a so they had the special blends. you'rea mum, so they had the special blends. you're a mum, you thought there was plenty of this stuff? there is loads. you said you worked in this industry for many, many years, before you became a parent, you are italian and you lived in the uk and the us, but what you're trying to bring through with this food that's different is the fact that there is more veg in it, it has got the mediterranean touch? proteins, really coming through, the mediterranean approach to eating.- aaron says, it is a really, really busy market. all my boys have grown—up. they are beyond this food, but i remember when they were small andi but i remember when they were small and i would go to the supermarket shelf, have you tried it... no. there is loads of different types of food and many told me they are organic and home—made and it is fresh produce and all perfect for your child and there is so much pressure on you to pick the right thing. what we were hearing from parents first of all to get more of
interesting, innovative blends. one of our top sellers is mango kale in asda and in waitrose we are selling really well our vegetable blends. 100% leek, pea, courgette with a hint of olive oil so really pushing up hint of olive oil so really pushing up the style and the flavour blends that are offered on shelf. you need money obviously for a start—up? that's true. where did you go? luckilyjust from my background working in food education i knew a lot of fantastic investors who believe in healthy food and life style believe in healthy food and lifestyle type of brands as well as we looked for a fantastic women angels and we have two female investors so those two women have brought so much to our business. 0k. we're out of time. you say goodbye and i will have a little... he's trying it. that's good. you're going to have a baby now?|j
you're going to have a baby now?” need more than this to have a baby, i'm sorry. cat, thank you. good luck with piccolo. ina piccolo. in a moment we will go through the business pages with dominic. the business live page is where you can stay ahead with all the day's breaking business news. we'll keep you up—to—date with all the latest details with insight and analysis from the bbc‘s team of editors around the world and we want to hear from you too. get involved on the bbc business live web page. on twitter we're at bbc business and you can find us on facebook. business live, on tv and online, whenever you need to know. you have been getting in touch about
samsung. we asked are you loyal to samsung. we asked are you loyal to samsung and will you stick with the company? mark says, "it is ok to blame the battery, but they approved its release. how good is its testing and quality control." another viewer says they are staying on board. another viewer says twice burnt, no thanks. the bbc‘s dominic o'connell is with us. the telegraph theresa may is going to be the first world leader... to meet donald trump. she is pinning her hopes on getting an early trade deal. we can't do a trade deal yet. we can talk about it. two years before we can do something. the americans are good at extracting good deals if we are an eager buyer. you remember when we did the open skies deal, it was always on their terms. there was something mentioned aboutjobs. this
terms. there was something mentioned about jobs. this deal, terms. there was something mentioned aboutjobs. this deal, possible deal, could mean uk and the us people easily travelling back and forth and living? you maybe have an open border and that's a long way. trump has talked about american jobs and buy american and not uk.” trump has talked about american jobs and buy american and not uk. i don't know if we will get the open border with the us. that would be quite something. theresa may is flying to washington on friday. let's talk about the super tower buildings. two giant masts will be built near dover. why? because it is all about high frequency trading. it takes six 1,000ths of a second for a microwave signal to travel from london to frankfurt. that's too slow. this mast will shave two or three milliseconds off that. that's incredible. people have the image of
the stock exchange of men in red braces. that's no longer what the markets are. 40% of the trading in the london stock exchange has less than other markets. it is high frequency trading. there is no human contact. we are building masts on the coast of england pre—brexit and we are hoping this will keep people in london. the villagers are not happy, are they? it is up for a planning application and the villagers may turn it down. you were in davos, did you meet him?” villagers may turn it down. you were in davos, did you meet him? i didn't meet the robot, no. i bet the robot was a cracker. dominic, short and sweet, we've got to wrap it up, thank you, mate. thank you for your company too. we will see you tomorrow. hello there. it's a very quiet
weather story across the country at the moment, but at this time of year that can have its own set of problems. fog was an issue first thing and some of that is slow to clear away. in one or two places it may linger. if you have got to be out and about, it is worth bearing in mind and perhaps tune into your local bbc radio station for updates. if the fog does linger, the temperatures will struggle, but elsewhere, once the fog lifts, we should see dry and sunny weather in the forecast. more of a breeze out towards the west and the cloud thickening here. throughout the afternoon, if we've got fog and it does linger, temperatures will struggle to climb above freezing, if you get breaks and sunshine coming through, around four or five celsius, so not the warmest of days out there, but at least, it is sunshine. milder out to the west. more sunshine as well. highs likely
of eight or nine celsius. there will be some fair—weather cloud, but not a bad afternoon. into northern ireland and scotland, the cloud and the breeze will start to pick up later on particularly to the west, but the far north—east of scotland will stay dry and sunny. temperatures here only four celsius. the reason the breeze is picking up is because there is a weather front trying to push in from the west. it will bring cloud and outbreaks of rain as it moves through northern ireland and western scotland through the night tonight so here, a milder night, but elsewhere, we see a return to more frost and fog particularly across eastern england. so it is another murky old start to the day. but with a bit more of the breeze out towards the west that should help lift the fog away. the cloud and drizzly rain pushes into north—west england and wales. more cloud here generally, but a milder feel. we might see double digits likely with ten or 11 celsius and colder in the east with top temperatures of four to six celsius. not much change in the weather story. there will be more of a
breeze i suspect with the weather fronts trying to push in from the lantic, but they are not making much ofan in—road, lantic, but they are not making much of an in—road, but with the isobars squeezing together, the wind is more ofa squeezing together, the wind is more of a feature, it means fog shouldn't bea of a feature, it means fog shouldn't be a significant. so the fog will clear later in the week. the wind will be quite chilly at times. milder by the weekend though. hello, it's monday, it's nine o'clock. i'm joanna gosling in for victoria. welcome to the programme. in the last year, a record number of people — nearly 4,000 — have become victims of online dating scams. we have an exclusive report in which we hear from women who've lost hundreds of thousands of pounds to fake romances. i believed in john. i believed injohn. i believed i was helping him. iwas i believed injohn. i believed i was helping him. i was completely bowled over by him. the full film coming up at 9.15. also on the programme, the prime minister, theresa may, is set to unveil a new industrial strategy aimed at boosting the post—brexit economy, and seeing the government stepping up to "a new, active role". we'll be talking to business leaders