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David Cameron Demands Changes to Britain's Relationship with EU; Interview with Jean-Claude Trichet. Aired 4-5p ET
Aired November 10, 2015 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[16:00:00]
MAGGIE LAKE, CNN ANCHOR: It is back on steady footing after a miserable Monday. It's Tuesday, the 10th of November. Tonight, let the bargaining
commence. David Cameron kicks off talks with Europe on Britain's place in the E.U. Time to pick up the pace. Jack Lew tells CNN when it comes to the
economy the rest of the world needs to up its game. And farewell to a giant of German politics. Memories of Helmut Schmidt from the former ECB
President, Jean-Claude Trichet.
I'm Maggie Lake, this is Quest Means Business.
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Good evening. Sometimes less Europe is better than more. That was the message from David Cameron as he demanded changes to Britain's relationship
with the E.U.
(BEGIN VIDEO CLIP)
The Prime Minister laid out his terms on the economy, immigration, and sovereignty. He warned that if Europe didn't agree, Britain could leave the
Union. As Max fosters explains, leaders on both sides of the channel faced a difficult balancing act.
MAX FOSTER, CNN INTERNATIONAL CORRESPONDENT: David Cameron spelled it out like this.
DAVID CAMERON, BRITISH PRIME MINISTER: This is, perhaps, the most important decision that the British people will have to take at the ballot box in our
lifetimes.
FOSTER: Before 2018, British people will vote on whether to leave the European Union. Cameron wants to stay in, but only if he can renegotiate
Britain's membership of the club.
CAMERON: If we vote to leave, then we will leave. There'll not be another renegotiation and another referendum.
FOSTER: It was all set out in a letter to Brussels. The starting gun for the Battle of Britain and Europe. So, what does he want? Well, firstly, he
wants to protect the single market for Britain and other countries that did not adopt the Euro. He wants to make the E.U. more competitive by cutting
red tape on businesses, to protect Britain's autonomy from E.U policies and laws. And most controversially, to control migration from the E.U and to
restrict benefits for out of work migrants.
ANGELA MERKEL, GERMAN CHANCELLOR: (As translated) We want to take a solution-oriented approach to dealing with these proposals. There are some
difficult points and some less difficult points, but if one has a spirit of wanting to solve this, then I have a certain confidence that this can work
out.
GEORGE PARKER, POLITICAL EDITOR, FINANCIAL TIMES: David Cameron's proposal on the face of it seems discriminative of European Nationals who come to
work in the U.K. So it's a difficult one to pull off. Politically it's difficult of course because countries like Poland see this as a direct
attack on their citizens who are migrating to the U.K. to work. So it's a difficult one, it could require the European laws to change; it could
require British law to change as well.
UNIDENTIFIED FEMALE: [Video] Every week the United Kingdom sends 350 million pounds of taxpayers' money to the EU.
FOSTER: Campaigners wanting to leave Europe are already hard of work. To them, the upcoming referendum is a once in a lifetime opportunity. Many of
them are in Cameron's own Conservative party.
(END VIDEO CLIP)
FOSTER: The problem David Cameron's got is that he's widely regarded as a pro-European and many here in London's political quarter can't quite
believe that he would choose to leave the union if he didn't get reform. But he has to convince his E.U. counterparts that he is serious. Otherwise
he's just undermining his own negotiating position.
Max Foster, CNN, London
(END VIDEO CLIP)
LAKE: In or out, Britain will have up to two years to decide. David Cameron's list of demands lays the framework of negotiations in Brussels
next month. The outcome of that summit will help determine the timing of the referendum.
The London times reports that if negotiations goes well the Prime Minister could hold a vote as early of June as 2016. But if he does not get the kind
of concessions he wants from Britain's E.U. partners the vote will likely be delayed. Mr. Cameron promised to hold the referendum by the end of 2017.
Now supporters of Britain's staying in the E.U. say the benefits of membership are worth as much as $117 billion a year for the U.K. John
Longworth is Director General of British Chamber of Commerce, he says maintaining the status quo is not an option.
Mr. Longworth joins me now from London. Thanks very much for being with us. When you say the status quo is not an option, what do you mean by that? I
mean, when you lay out the list of what has to change it doesn't sound very convincing that business does want to remain part of the E.U..
JOHN LONGWORTH, DIRECTOR GENERAL OF BRITISH CHAMBER OF COMMERCE: Well, first of all, it's very clear that the status quo doesn't exist because the
Eurozone as a grouping of nations with bilateral agreements is moving rapidly away from the rest of the E.U. So actually it's not a question of
the U.K. moving away from the Eurozone within the E.U. is moving away from the U.K. So there is no status quo. What we have to do is to actually find
a new settlement for the U.K. within that European Union when we are very unlikely ever to join the Eurozone.
[16:05:13]
LAKE: There are -- there are surely going to be people in Europe who look at this and says Britain wants all the benefits without giving up anything.
LONGWORTH: Well, it's not a question of Britain wanting all the benefits without giving up anything.
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LONGWORTH: The truth of the matter is there are a number of countries not in the Eurozone but in the European Union and the Eurozone is not the
European Union and the Eurozone will have to create a political, economic and monetary union in order to survive or become increasingly like a
nation.
That's not what the U.K. wants. Now, we did some of the biggest business surveys in the U.K. and our latest poll on the European Union show that the
majority of our members want to remain members of a reformed European Union not a Eurozone.
(END VIDEO CLIP)
LONGWORTH: But 50% of them, a full half, said they would change their minds according to the outcome of these negotiation. So the Prime Minister's
negotiations are very, very important for decision-making process, even within the business community which itself is divided.
And the truth of the matter is I think the Prime Minister's made a quite courageous decision to go ahead with the negotiations in the way he is
doing and he's made it clear that he will walk away from the table if he doesn't get a reasonable outcome. He has to do that of course, as any
businessperson knows. If you're not prepared to walk away then the negotiations are null and void from the very beginning.
LAKE: Are the Euro skeptics are those who want out doing a better job at framing this debate? Does the business community need to do more to explain
what the benefits of staying in are?
LONGWORTH: I think there needs to be more information on both sides. There are both risks and opportunities of staying in and of leaving. So there's
lots of information that needs to be got out in the public domain and the business community. One of the things that our business members are saying
is they don't know enough about the facts. And certainly the general public don't know enough about the facts. So there's a big job to be done in
actually explaining what the various consequences might be of both staying in and leaving.
LAKE: And one thing we know is businesses hate the uncertainty. So big job indeed. John Longworth joining us from the British Chamber of Commerce.
Thank you for your time tonight, sir.
Now tonight people in Europe and beyond are remembering a key figure in modern Germany and a strong proponent of European immigration.
(BEGIN VIDEO CLIP)
LAKE: Helmut Schmidt was West Germany's Chancellor from 1974 to 1982 when relations with East Germany were at an all-time low. He was instrumental in
setting up the European monetary system which paved the way for the Euro. Helmut Schmidt was 96.
(END VIDEO CLIP)
LAKE: Jean-Claude Trichet was the President of the European Central Bank for eight years. He joins me now from Paris. Thanks so much for being with
us. Schmidt as we just said was seen as such a pivotal figure in the European project. Why is it that he believes that was the right future for
Europe?
JEAN-CLAUDE TRICHET, FORMER PRESIDENT OF EUROPEAN CENTRAL BANK: I think, yes, we are all mourning not only in Germany but certainly all over Europe.
(BEGIN VIDEO CLIP)
TRICHET: because Helmut Schmidt was a doer and absolutely decisive in making Europe going more and more in this ever closer union, that we
constructed over the years. So he was absolutely convinced that the future of his own country, of course, the future of Europe as a whole, the.
Friendship between all the countries that are making up Europe including of course the friendship between Germany and France, was absolutely decisive.
And I have to say that he was a very, very impressive statement. Not only I would say for Europe but also for the entire world because he was a
dedicated citizen of Europe and a dedicated citizen of the world.
(END VIDEO CLIP)
LAKE: In the latter part of his life, did he worry that that project that he -- that he fought so hard to bring to bear was starting to fail? Was he
worried that Europe was moving away from the integration he fought so hard for?
TRICHET: He was certainly calling permanently for more union, more political union.
(BEGIN VIDEO CLIP)
TRICHET: And I have to say in the period of the crisis when we had so many challenge, so difficult challenges, when so many tough decision had to be
taken. In particular, I have to say by the Central Bank in '08, in '10, with the purchase of treasuries of some countries which we are not at all
seen positively by the German public. I was very often in touch with him and he was always backing, I would say, the European defense.
(END VIDEO CLIP)
[16:10:00]
TRICHET: He always was ready to explain why he thought that what was -- what the European Central Bank was doing was good and right. I have to say
that, for me in particular, I'm sure for my successor, it was very heartening to have such a backing by such a statesman.
LAKE: That's right. And those words did a lot, absolutely. I wonder, we were just talking with a guest about Britain talking about renegotiating
with the E.U., possibly leaving the E.U. We've seen the rise of extremist parties within Europe. Does Europe need more political integration if it is
going to survive?
(BEGIN VIDEO CLIP)
TRICHET: My sentiment is that -- first of all, Europe has gone through the worst crisis ever since World War II with a great deal of resilience. I
think we should never forget that.
(END VIDEO CLIP)
TRICHET: The euro hold and the European single currency area with the 19 countries hold also. But it is true, we need more executive branch, if I
may, in Europe, in the area, and we need more democratic accountability and legitimacy with more power to the European parliament, which by the way was
decided to be elected by universal suffrage I would say crucially (inaudible).
The two men had a meeting of mind, which has been very instrumental, including to have this European parliament elected by universal but also to
create even the summit of industry of the country was very much pushed by both statesmen in, as you know, '75.
LAKE: And we certainly need leadership today. We know that you lost a colleague and a friend. Thank you so much for joining us tonight to share a
little bit about him with us. We appreciate it.
TRICHET: It was a pleasure.
LAKE: Jean-Claude Trichet.
Well Jack Lew says the rest of the world admires the resiliency of the American economy.
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LAKE: Ahead of the G-20 summit, the U.S. Treasurer Secretary speaks exclusively to CNN.
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LAKE: The U.S. Treasury Secretary says the American economy is doing very well and it's time for the rest of the world to pick up the pace.
[16:15:03]
In an exclusive interview Jack Lew spoke to our chief business correspondent Christine Romans in the run-up to the G-20 meeting later this
week. He told her he wants to see a global economy that helps to pull things along instead of pushing back.
JACK LEW, U.S. TREASURY SECRETARY: I think that what's going on in the world right now is that the U.S economy is doing better than other
economies on relative basis.
LAKE: Right.
ROMANS: The answer is not for the U.S. economy to do less well. The answer is for the rest of the world to kind of pick up the pace.
ROMANS: Right.
LEW: And there are some signs, you know, that things are a little better in Europe, but sustained growth in Europe would be really important.
ROMANS: Right.
LEW: China is obviously a big part of the equation, keeping the growing consumer demand in China growing and opening that economy is important.
Continued reform in Japan is important and making sure they don't slip back, which, you know, they've had some signs of a risk that that would
happen.
So there's a lot of things to worry about. And then the emerging markets are kind of on the heels of China sort of settling into a new normal of a
lower growth rate. I'm seeing a reduction in the strength of the commodity markets that were so much driving a lot of the emerging economies. So
there's a lot happening in the global economy right now that from a U.S. perspective add up to headwinds.
ROMANS: Are you concerned at all about China's growth strategy here? I mean they've sort of gently lowered their expectations for growth, I think a
little bit above 6 1/2%. Is there any risk that they're not going to be able to make those numbers and what would that mean for us?
LEW: To be clear, I think China will have some years that are stronger than other years. The important thing is do they stick to their reform agenda?
Do they continue to open their economy so it becomes more consumer driven so the Chinese consumers start to help drive China and the global economy
more? And are they willing to open up their market to competition?
Some things that they have to do to reform their economy could mean short- term drag for medium and long-term growth. So I think focusing on what the average is is more important than focusing on kind of what the minimum is.
China may have to be willing to see some bouncing around of its growth rate to stick to a reform agenda which is what they need to be really the kind
of powerful economy that they need to be going forward. It's good for the United States, it's good for the global economy for China do have a strong
economy.
ROMANS: I want your sense of what the Obama economy is because we're talking about all of these economic statistics that are showing the
trajectory of the American economy moving forward. But when I listen to the campaign rhetoric, Obama economy is a dirty word and there are 100 million
people who are not in the labor force and it's not working for everyone. You say there's still work to be done. But in your own words tell me what
is the Obama economy?
LEW: Well, you know, I think we came in at a time when the economy was suffering from the worst recession since the great depression. We had an
enormous hole to dig out of. We came out of that and we've come out of it with that usual resilience of the U.S. economy shows to pick it's up
because the American people pick themselves up and they do what it takes to get themselves and the economy moving again.
The rest of the world admires that and wishes it could copy it. I think that the challenge of income growth, particularly middle class income
growth, is something that we're concentrating on, we continue to concentrate on. There are some good signs in last month's jobs numbers that
there was a little bit more wage growth than we'd seen before.
ROMANS: Best in six years.
LEW: So that's - that was a positive sign but we've got to see more of that. You know, look we know what the answer is to do some more things to
get this economy moving. We need to invest in infrastructure for the future. We need to invest in education and training. We need to reform
immigration laws. All three of those things would do a lot to get our economy moving. We're doing everything we can. The fact that it's been hard
to get legislation on those things through congress means there's still more work we could do but it's not - it's not a mystery what it is we could
do to do better.
(END VIDEO CLIP)
LAKE: Treasury Secretary Jack Lew there talking to our Christine Romans. Paul La Monica is here to join me to talk about this.
Paul, a little legacy touting there going on by Jack Lew and that last parting comment sort of blaming the Republicans a little bit for the fact
that more hasn't been done on some of those long-term problems.
We're having a debate tonight on the Republican side, we are entering an election year. Jack Lew saying the economy is in good shape. That's going
to be an issue for the Republicans as they try to pick that apart.
PAUL LA MONICA, CNN MONEY CORRESPONDENT: Yes, I think that the Republicans if they're smart they will stop bullying each other even though there are
so many candidates they kind of have to - you know before we get whittled down to a few.
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LA MONICA: But of course the Republicans can find common ground in poking holes at some of the things that treasury secretary Jack Lew said. To be
fair, of course, the economy has come out of a huge hole as he put it in 2008 and it has come back to life but it hasn't roared back to life.
We've got sluggish economic growth, wage increases finally picking up. 2 1/2% is still subpar so I think the Republicans could, if they were smart,
talk about how things could be better.
(END VIDEO CLIP)
[16:20:11]
LA MONICA: But again, they have to provide some solutions. And, as Treasury Secretary did point out, we do have gridlock in Washington right now. I
think he alluded to that.
LAKE: Yes.
LA MONICA: And that's something that has been a bit of a problem.
LAKE: And well we've got some statistics where they're talking about the jobs. I mean I think everyone does acknowledge that we were digging out of
incredible hole. I mean they're talking about jobs created -- the Obama administration while certainly not as high as everyone would like, they
have made a dent in that.
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LAKE: Look at that, 8.7 million jobs. I think this is going to be the problem for the Republicans. Bill Clinton, 20 million jobs. When they've
got a reference on how to address this. And to your point, what to do about the income divide, the fact that some Americans are being left behind by
changes in technology.
(END VIDEO CLIP)
LAKE: We haven't heard a lot discussed on those very important issues. The Republicans have got to put meat on the bone at this point, don't they?
LA MONICA: Yes, definitely. Income inequality is a major problem in this country. You see it when you breakdown the unemployment numbers and you see
particularly with minorities having much higher unemployment rates than whites with college education.
So it is something that the Republicans I think need to address. The one major challenge though is just how can you really get things moving when
you have other parts of the world struggling as much as they are? We are an interconnected economy Jack Lew can talk all he wants about the rest of the
world needing to pick up the pace but that's easier said than done given the challenge the Europe and China are facing right now and that's going to
hit the U.S. eventually.
LAKE: And I'm very interested to see if we hear any of that in the debate tonight, can they comment on China, do they understand what's happening in
Europe. We haven't heard anything about that so far in a campaign beyond rhetoric, and I can do a deal with China.
LA MONICA: Yes, we need more than just rhetoric about trade wars, exactly.
LAKE: We'll see if they can flush that out. It will be very interesting to watch.
Paul, thanks for joining us. Paul La Monica.
It has been called hacking as a business model. Prosecutors say a (inaudible) manipulation scheme made 4 hackers a hundred million dollars.
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LAKE: Now charges have been brought over the JP Morgan data theft and financial fraud on a grand scam.
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LAKE: The Justice Department has charged three men it says carried out the largest ever theft of customer data from a U.S. institution.
The men are accused of stealing the personal information of 80 million JP Morgan customers last year. Officials say the gang also hacked Dow Jones,
E-trade, Scottrade and 8 other companies.
[16:25:10]
The U.S. Attorney for the Southern District of New York, Preet Bharara called the case a turning point in cybercrime.
(BEGIN VIDEO CLIP)
PREET BHARARA, ATTORNEY FOR SOUTH DISTRICT NEW YORK: In our view the conduct alleged in this case showcases a brave new world of hacking for
profit. It is no longer hacking merely for a quick payout. Rather it is hacking in support of a diversified criminal conglomerate. It is hacking
to locate victims, it is hacking to spy on the competition, it is hacking to maximize profit. In short, it is hacking as a business model.
(END VIDEO CLIP)
LAKE: Joining me now is CNN's money Jose Pagliery who's been following this as business model. I mean, explain, Jose, why they think this is sort of
brave new world? Why did Preet Bharara say that?
JOSE PAGLIERY, CNN MONEY CORRESPONDENT: So here's why. The conversation is always that you have these big companies that get hacked, and we never find
out who these people are. Well, somehow the FBI, secret service teaming up with law enforcement around the world have discovered how a group of three
guys, two from Israel, one American, were able to create online casinos and bitcoin exchanges. And sort of the little hacker groups to be able to enter
banks, steal information, and then use that information to create a pump and dump stock manipulation scheme.
So the idea here is that hacks aren't a crime in and of itself. It's a tool that empowers criminals to do a whole lot of other stuff.
LAKE: Right, and it's ongoing. It's not like they run in one time, steal something, sell it, and, then boom, they're done. This is sort of a part of
their everyday operation.
PAGLIERY: This is part of the business model. I mean look these - hackers - - the idea of a hacker that we all have from the 1990s, right the kid in the basement, it's just not the case anymore. That's not what hacking is
now. Hacking now is a criminal enterprise. It's a criminal syndicate. It's just like an arms trade, right? These are weapon, cyber weapons that
companies and others use to break into other companies. That criminals use to sell data and sell it online. And in this case what it did was that
these guys were able to break into banks, get contact information for potential investors and then target their victims. They were - they knew
who would buy stock and then trick those people into buying penny stock pumping up the price and then selling it just before the crash.
LAKE: -- Which is -- which is so scary on a level of that sophistication and what they're learning about these people is really frightening. The
fact that they were able to catch them should we take solace in that because they're not a lot of cases we've seen, a lot of them go unsolved or
is just another indication that we're really far away from being able to stop it even if they got them?
PAGLIERY: OK, so we can't stop it. Let's just admit that right now. Let's have our moment of Zen and just admit we're going to be victims. Companies
are going to be victims. You and I are going to be data breach victims. But this is a major turning point. Because in all the other major hacks we
haven't found out who these people are. And even if we do they're in Russia and we can't extract them.
LAKE: Right, and the more you know about the activity the more it does give law enforcement the knowledge, if not to stop it all together, to get
closer on the trail, I would imagine.
PAGLIERY: Sure. But the big thing is they were able to id these guys and Israeli police have them under arrest in Israel. They were able to id
another guy who is an American and law enforcement wouldn't tell me where he is. This is Joshua Aaron.
LAKE: Do you think they can flip them and get information from these guys? We saw that a little bit with the (inaudible), they sort of made
connections with some --
PAGLIERY: Sure. And that's how they usually do it. But what's interesting is if he does what other hackers have done, which is go to a place like
Russia, we can't touch them.
LAKE: Yes, so to be continued. But we all need to deal with this reality, as you say. All right, Jose, thanks so much. (Inaudible) little bit more
scared of talking to you.
Well singles day kicks off in China and billions of dollars have already been spent as the e-commerce binge gets under way.
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[16:32:07]
LAKE: Hello, I'm Maggie Lake. Coming up on the next half hour of "Quest Means Business," the CEO of Vodafone tells us why his company has reached a
turning point.
And an icon of 60s style is reborn. We'll show you how the TWA terminal at New York's JFK Airport is getting a new lease on life.
First though these are the top news stories we are following for you this hour.
British Prime Minister David Cameron has laid out his demands to the European Union ahead of a vote on whether the U.K. stays in the E.U.
Mr. Cameron says he will campaign for Britain to remain a member of the E.U. if it gets concessions on immigration and other policies.
He has promised to let British people vote on the E.U. membership by the end of 2017.
A Moscow laboratory caught up in a doping investigation has closed its doors after losing its accreditation from the World Anti-Doping Agency.
The head of Russia's Anti-Doping Agency now admits there have been problems inside his organization but says they are being fixed.
The votes are still being counted in Myanmar after Sunday's historic election. Pro-democracy campaigner Aung San Suu Kyi is already claiming a
landslide victory for her party.
Suu Kyi says even though the constitution bars her from holding office, she will hold the strings of power after a president is chosen.
Tributes have been paid to former West German Chancellor Helmut Schmidt who has died at the age of 96. Schmidt was chancellor from 1974 to 1982 before
East and West Germany were reunited. He died in his hometown of Hamburg.
Current chancellor Angela Merkel said his legacy continued to inspire Germans.
(BEGIN VIDEOCLIP)
ANGELA MERKEL, GERMAN CHANCELLOR, VIA INTERPRETER: His personal modesty as well as his sense of duty impressed us.
Helmut Schmidt was a political institution of Germany and he was for me an authority whose advice and judgment meant something to me.
(END VIDEOCLIP)
LAKE: Returning to Britain's future in Europe, there are some big companies that have said publicly they don't want the country to leave the
E.U.
Vodafone, the mobile operator, is one of them. The company is the world's second largest cell phone operator and results it has released earlier beat
expectations thanks to a boost in revenue from Europe.
Isa Soares asked the chief executive if this was a turning point for Vodafone.
(BEGIN VIDEOCLIP)
VITTORIO COLAO, CEO, VODAFONE: It's turning point in the sense that it's the fifth consecutive improvement, but most importantly it's the first time
where we had increased EBITDA.
The good thing is that it spread so that's the reference to the group. It's Europe but it's also emerging markets, it's enterprise, but it's also
consumer which improving.
[16:35:02] And it's also the new era as machine-to-machine, internet, things that actually start pulling quite nicely.
So it's an overall improvement that you see across the piece. For sure in Spain we are seeing good results. We have a very strong convergence
strategy there and it's starting to get results.
Ground 800,000 connections converged families with us. It's fixed line, 12.5 mareesh (ph), 12.5 million homes connected now. You think about
Vodafone, you think mobile.
ISA SOARES, CNN ANCHOR AND CORRESPONDENT: Yes.
COLAO: Actually we have 12.5 million homes - it's the fourth largest provider in Europe. There's also data 3G 30 million 3G largest, 4G network
in Europe, 3G in emerging markets.
So everything we bet on when we set up our strategy three years ago is actually going in the right direction. We still have room to grow - let's
not run ahead ourselves, but the signs are positive.
SOARES: Liberty Global of course, that didn't happen - the merger. Are you disappointed?
COLAO: No, I mean you always work on possibilities. You have a plan A and I'm glad are far as talking about this today because my plan A actually is
delivering as we have seen with today's results.
And then you have a plan B and you think of ways of improving, and so I still believe that there was strong, strategic rationale for some kind of
combination of assets, but at the end of the day, if you don't find agreements, you just stop the conversations and you move on.
SOARES: You've moved on from the acquisition front?
COLAO: Well we move on from that auction for the time being. Then, you know, life is long, we'll see what happens.
SOARES: But you're not disappointed?
COLAO: Well I'm never disappointed because, as I said already today, in the meantime my colleagues have been working hard, the results are starting
to come through, so I'm happy I explored an option that could have been, I think, positive for the company.
But in the meantime, the rest of the company has worth.
SOARES: I want to get your thoughts on Brexit. We heard today David Cameron give a speech about the four rules you would like to see in terms
of reform in the U.K.
Where do you stand on the topic of Brexit? Is this good for business or bad?
COLAO: I can only speak for my business, I don't have the mandate to speak on behalf of all other businesses. But for sure for a company like ours
which is operating in the digital space which needs and actually enjoys the size of the markets and simplicity of rules and uniformity of rules, for
sure being part of a single digital market is important, and being inside a single digital market is important.
So in that sense, clearly we want Britain to remain in Europe. Having said that, the political decision is not our matter, it is for the voters. The
voters have to decide what they prefer.
But for Vodafone - for Vodafone's share on this one - Vodafone's customers, it's better to stay in Europe.
(END VIDEOCLIP)
LAKE: Cell phone companies are making bigger and bolder plans to win customers in a very crowded market. T-Mobile USA has just announced a new
plan that lets users stream unlimited amounts of video to their mobile devices without using up their data.
It's partnered with Netflix, ESPN, HBO, Showtime to name just a few. Bruno Mars is helping launch the service at a concert in Los Angeles.
CEO John Legere is there and he joins us now live.
John, you guys always know how to throw a party. It seems like the atmosphere but it sounds like you guys are starting a data war.
JOHN LEGERE, CEO, T-MOBILE: Oh, I tell you what. I love un-carrier days. This is un-carrier 10 - this is the 10th time that we've brought some
innovation to solve a customer "pain point".
We did three things today that were great. One is we doubled the size of all of our data buckets on the Simple Choice plan. So what used to be 1, 3
and 5 is not 2, 6 and 10.
We announced Family Match so that anytime you can get the family to all agree to buy incremental data, you get twice as much at no extra cost.
But the big one is we announced Binge On where you can, starting with 24 partners - Netflix, Hulu, ESPN, HBO - that you can stream video for free.
And we've done that by optimizing the data stream which required for DVD quality on a mobile device can actually be done in a very efficient way
that is good for our company and good for our cost structure but wonderful for our customers.
And heads are spinning right now on how they're doing it, and I like that part.
LAKE: Yes, exactly, so how are you doing it? If it's not going to cost the customers, how are you able to afford to do this?
LEGERE: Well a little secret sauce here. But, you know, what I can tell you is this, you know, two things - at the highest level, all content is
going to the internet and all internet is being viewed mobily.
[16:40:02] And the way that movies and TV are made, there's tremendous amounts of wasted data - bit streams that are way, way more than what a
mobile device could use.
So what we've done with proprietary technology is we've optimized what it's required to get DVD quality on the device and we'll send that to you.
And by the way, if you don't want this, you simply can go in and toggle the switch on and off as many times as you want. But what we're finding is
that especially millennials 57 percent of all their viewing is on mobile devices -
LAKE: Yes.
LEGERE: -- and they also admit 84 percent of them to watching three or more shows at a time. So, I think a lot of people are thinking about T-
Mobile right now.
LAKE: Yes, we all have our binge-guilty secrets. John, it's great to be able to have access to a service if it works. If there is a complaint
about T-Mobile, sometimes it is about -
LEGERE: Right.
LAKE: -- the network. And especially if you're talking about binge- watching in crowded cities, we all know there are spectrum traffic jams.
Is this going to actually work as well as it sounds like it should?
LEGERE: Oh, that's a great, great question. Now, amongst the things that are very powerful right now is that right now we have 302 million PoPs of
LTE service in the United States which is dramatically more than last year or the year before so the coverage is incredible.
Including 176 million PoPs of low-band LTE. And so this really is a, you know, check-it-out-for-yourself. I'm not going to try to tell anybody how
great this quality is. It's free and all you need to do is toggle the switch. And by the way, if it's beautiful, it's free. And any service
that wants to meet our technical requirements -- which means we have to identify their service -- can join.
I think it's a really big deal, and as mobile data grows through the roof, it's very good for the company and it's great, great for the customers.
LAKE: And, John, you're a master salesman and this is why the speculation about a merger with someone continues to swirl.
You'll keep us up to date on that. Thank you so much for joining us. Enjoy the event. John Legere from T-Mobile.
LEGERE: Thank you. OK.
LAKE: It is early hours in the morning in China -- nothing like the sunshine. You just saw where John is still billions of dollars have
already changed hands for Single's Day, China's annual e-commerce binge.
Alibaba says sales through its payment system totaled more than $5 billion in the first 90 minutes. The company has built a special Singles Day
command center in Beijing.
Matt Rivers is live in Hong Kong and joins us now. Matt, you're not the only one who's up in the middle of the night. I think the whole country
seems like they're connected on the internet right now.
That number is staggering!
MATT RIVERS, CNN CORRESPONDENT: It is absolutely staggering, and it really is a very good indication of the power of the Chinese consumer. You said
it -- $5 billion. Over $5 billion spent in the first 90 minutes.
How about this? In the first eight minutes there was over $1 billion U.S. dollars spent. It really is remarkable, people are actually filling up
their shopping carts over the last several days and then as soon as it kicked off at 11 p.m. local time, people went online, clicked `Buy' and you
can see the revenue that is coming in as a result of that.
For a little bit of perspective, the closest thing that the United States has to Singles Day would be Cyber Monday. There was $2 billion or so in
sales on Cyber Monday in the 24 hours of Cyber Money last year.
It took Alibaba alone 17 1/2 minutes only to top that total for Cyber Monday. So really it is a remarkable amount of money being exchanged
online here in Asia on Singles Day.
LAKE: It certainly is. And what is this going to mean for Alibaba? Because, you know, we saw that fantastic IPO and then we saw a lot of sort
of disappointments start to come in, the stock under pressure. It seems like it's been righting itself.
What is this going to mean for the stock? How closely are investors watching this for Alibaba?
RIVERS: Well they're watching very closely in part because it has been a difficult year for Alibaba.
Right now the stock is down about 20 percent year to date, and while it did rebound nicely in the third quarter beating most Wall Street estimates in
its earnings, it has been a tough year for many - the same way it's been a tough year for many Chinese companies having to deal with the slowdown in
the Chinese market.
They've had to deal with that in a pretty major way, and also within the last month or so, we've seen a report out in Chinese state media that more
than 40 percent of goods sold online in China are counterfeit in some way.
Now that report didn't single out Alibaba but Alibaba is the largest online retailer in China. So it certainly didn't help this image.
That said, billions of dollars in sales on one single day for a company, certainly not a bad thing. So it's certainly something that investors will
be looking at.
[16:45:06] But perhaps more than that, it's whether these customers that are showing up and shopping online today under the cloud of major discounts
-
LAKE: Yes.
RIVERS: -- will those consumers return two weeks from now, three weeks from now? Will this kind of be a jump off point for Alibaba moving
forward? That remains to be seen. But it's certainly a big day for the company.
LAKE: It certainly is. That's always the question - with those promotions do you just steal future sales? That's what we talk about around the
holiday season here and it's something we're going to have to look at for Singles Day.
But certainly it's a success so far, right, Matt? Enjoy, I'm sure you've got some shopping to do yourself. Matt Rivers for us.
RIVERS: I've got my phone.
LAKE: Yes, right. Coming up, what will it take to undo the recent plunge in oil prices and why it could take several years.
(COMMERCIAL BREAK)
LAKE: The drop in oil prices that has rocked global markets could take many years to unwind. The International Energy Agency is predicting oil
prices will not reach $80 a barrel for about five years. That's where prices were at this time just a year ago.
John Defterios spoke to the chairman of FACTS Global Energy. He said growing demand will eventually drive prices higher.
(BEGIN VIDEOCLIP)
FEREIDUN FESHARAKI, CHAIRMAN, FACTS GLOBAL ENERGY: For the short term, this year and next year, the prices will remain between $40 and $55
dollars, up and down.
Once we get to 2017, then we have the prices probably reach $65 to $70 which will really invite more oil to come in and bring the prices down.
But when we get to 2018/2019/2020 period, the force of demand growth which will be about 6 or 7 million barrels because you have new demand, will
force higher prices to the $80 a barrel range.
JOHN DEFTERIOS, CNN EMERGING MARKETS EDITOR: We've seen capital investment down 20 percent in 2015. Does it continue for next year?
FESHARAKI: Oh absolutely. The investment is cut but a lot of bad investment has been cut - a lot of people who shouldn't have - shouldn't
have come into this extensive project, they're cut.
And there are some genuine projects are also cut.
So the impact of the cuts on the production are still not clear. There would be negative impact. For example, we see next year the U.S.
production will be 200,000 less than this year.
Not dramatic as people expect because the lower prices also result in lower costs. And costs have been reduced.
[16:50:01] DEFTERIOS: The Middle East producers have about a third of global market share today. In this scenario could they see their market
share go above 50 percent or even higher as a result of the price destruction?
FESHARAKI: Not by 2020 but probably by 2025. I think this is a sort of irreversible consequence. The Middle East it still has a $35 a barrel void
(ph) and those other oil producers have $30, $40, $50 more and so, yes, as the production falls Middle East shares will rise. There is absolutely no
way to avoid it, but probably a bit longer than 2020.
(END VIDEOCLIP)
LAKE: It's a relic of a bygone era. JFK International Airport's TWA terminal has just a few days before it's turned into a luxury hotel. We'll
make one last one toward the boarding gate after a highlight from "Make, Create, Innovate."
(COMMERCIAL BREAK)
LAKE: The famed TWA terminal at New York JFK's Airport will serve a new set of customers in a few years as the airport's first onsite luxury hotel.
The terminal is considered a landmark of the jet age travel as CNN's Richard Roth shows us.
(BEGIN VIDEOCLIP)
RICHARD ROTH, CNN SENIOR U.N. CORRESPONDENT, ALSO COVERING INTERNATIONAL STORIES IN NEW YORK CITY: Walking into the TWA terminal at JFK Airport is
like a voyage back in a time capsule.
This terminal opened in 1962. The men who designed it never lived to see it. Eero Saarinen, a famed Scandinavian designer, created it. His builder
said, well how do we do this? And he said I don't know, here are the plans, just do it.
MALE ANNOUNCER: TWA's Transworld Flight Center at New York International Airport.
ROTH: It was a glamorous jet age time and TWO represented the center of all of that excitement in the 60s.
NICOLE REINA, (): It's such a sexy, curvy building. It's like a woman's body. It's beautiful, it's amazing and I really, really hope that they
preserve the original integrity of this building.
ROTH: Only one day a year is the public allowed inside this terminal, and no matter where you walk, you hear a lot of great stories about the famed
past of TWA.
ELLEN BARONE, FORMER TWA FLIGHT ATTENDANT: It was like walking down the red carpet and walking into a different world because it was so into the
space age. It was a very glamorous era in the 60s.
Elizabeth Taylor I knew by -- we were on a first name basis.
ROTH: Yes, you'd never know who you'd run into with the famed TWA terminal. Hey, that guy's not a real pilot. The terminal has been opened
for movie productions.
[16:55:02] LEONARDO DICAPRIO, ACTOR IN "CATCH ME IF YOU CAN" MOVIE: Hello.
FEMALE ACTOR: Hi, are you deadheading?
DICAPRIO: What?
ROTH: Excuse me, you do know this terminal has been closed since 2001 when TWA went bankrupt?
FEMALE ACTOR: (LAUGHTER).
ROTH: Though the building's been closed for over 14 years, it's been landmarked so it could not be destroyed. And now in a major deal, it will
be a hotel but it will keep the shell of the TWA building as a lobby.
FEMALE: All those stories you imagined were true and then some.
(END VIDEOCLIP)
LAKE: Richard Roth reporting there. We'll be back with more "Quest Means Business" in just a moment.
(COMMERCIAL BREAK)
LAKE: A final check of the market before we go. The Dow spent most of the session in the red before finally eking out that 27 point gain at the
close.
Apple shares fell 3 percent, weighing on the market. Analysts at Credit Suisse say weak demand for iPhones has led Apple to cut component orders by
as much as 10 percent.
European shares ended mixed on Tuesday. Weak inflation data from China pushed down mining shares. Vodafone rose 4 percent after the mobile phone
operator raised its forecast for the year.
And in Portugal shares closed down 1/3 of a percent. That came before opposition parties ousted the center right minority government.
The vote came less than two weeks after a new government was formed following October's election. The president must now decide whether to
give opposition parties the chance to form a government or call fresh elections.
The earliest they could be held is February.
And that's "Quest Means Business." I'm Maggie Lake in New York. The news continues here on CNN.
END
