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Australia inflation edges up but still below target

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A shopper selects produts in an aisle inside a Coles supermarket, operated by Wesfarmers Ltd., in Sydney, Australia, on Tuesday, Feb. 18, 2014.

Ian Waldie | Bloomberg | Getty Images

Australian inflation ticked higher in the final quarter of 2019 but core measures remained subdued despite three interest rate cuts, suggesting the country’s central bank will have to do more to revive consumer prices.

The consumer price index (CPI) rose 0.7% in the December quarter, higher than forecasts of a 0.6% increase, driven by gains in cigarettes, domestic holidays, travel, fuel and fruit prices.

The annual pace rose to 1.8%, still below the floor of the Reserve Bank of Australia’s (RBA) 2-3% target band. Indeed, a key measure of core inflation was stuck at an even slower 1.6% marking four straight years below target.

This persistent weakness was one reason the RBA cut interest rates three times last year to an all time low of 1.75%, and why markets are still pricing in at least one more easing.

The central bank holds it first policy meeting of the year next week but is thought likely to stand pat given a recent welcome dip in the unemployment rate.

Futures imply a less than 15% chance of an easing on Feb. 4, though that rises to over 70% by April.

While the rate cuts to date have succeeded in reviving home prices, consumers remain burdened by stagnant wage growth and record-high debt levels.

Weeks of raging bushfires have further darkened the mood, as has the outbreak of coronavirus and its baleful impact on Chinese tourism to Australia.

Some of the increase in prices was due to drought and lower seasonal supplies of fruit, vegetables and meat. Economists expect the bushfires and the ongoing drought to further push up prices in coming months.

Ivan Colhoun, a senior economist at NAB, estimates the fires could shave 0.4% points off economic growth this quarter, while the virus could cost A$1-2 billion in lost tourism revenue.

Both were badly timed given domestic consumers were already inclined to save rather than splurge.

“There is little evidence of either tax cuts or interest rate reductions feeding into increased consumer spending,” noted Colhoun.

“We continue to see two further rate cuts this year and the possibility of quantitative easing if the unemployment rate deteriorates more quickly than we forecast.”

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Amazon Fire TV Stick and Fire TV Stick Lite announced, start at $30

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Amazon Fire TV Stick Lite

Amazon

Amazon announced two new Fire TV products during its big online hardware event on Thursday. Amazon’s Fire TV gadgets compete directly with Roku and Apple TV, offering people access to popular apps like Disney+, Netflix, Hulu and more. 

Amazon says people are spending more time in front of TVs than ever before due to the spread of coronavirus. It sees the TV as a the center of the household and wants to get even more features in front of users to keep them coming back. The new features may help it compete more aggressively against Roku, which still has a 50% market share of global connected TV streaming hours with strong growth opportunities, according to an analyst note from Deutsche Bank in August.

The new Fire TV Stick and Fire TV Stick Lite will be the first of Amazon’s streaming gadgets to offer a redesigned home screen when they launch next week, although the changes will come to existing Fire TV devices beginning in the first quarter of 2020, too.

Here’s what you need to know.

Easier to find stuff to watch, new user profiles

The new Amazon Fire TV interface, which includes user profiles.

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Amazon’s vice president and general manager of Fire TV, Sandeep Gupta, told CNBC that Amazon received feedback from users suggesting the home screen was too cluttered. Amazon worked on a redesign to make it easier to find stuff to watch and to quickly jump into live TV.

“Today, you can search for comedies, or stuff by Tom Cruise, but we’ve tried to make a landing spot for when you don’t know what you want to watch. This shows you stuff that’s free, movies and TV shows, broader categories, apps and more,” Gupta said. Gupta said the quick access to a TV guide will provide a familiar experience for people transitioning from cable TV to streaming.

The new software supports up to six user profiles. That means you can log into your profile and see the shows and movies Amazon recommends to you, while your significant other can use a separate account for their own personalized recommendations. You can also create profiles for children that will only show kid-friendly content you’ve approved. Previously, you’d have to switch profiles inside each app, like Netflix or Hulu, to see content recommended to you inside those apps.

The latest software provides a new option to see your Ring or Alexa-ready video cameras on your TV through picture-in-picture — kind of like seeing a small window on your screen — while you’re watching movies or TV show. 

Finally, Amazon is expanding its Alexa voice assistant on Fire TV. Gupta told CNBC that there are billions of requests to Alexa and that it has seen an 80% growth in requests on Fire TV over the last year, although he did not provide specific figures.

“It’s a good indication people like Alexa and are using it more to manage shopping routines, recipes, whatever it is, in a centralized place,” he said. Alexa’s responses now pop up and cover just a small part of the screen so you can keep watching or doing what you were without being interrupted.

Video chat for Amazon Fire TV Cube

The Amazon Fire TV Cube

Amazon

Separately from the Fire TV sticks, though still part of the new software that will roll out to other Amazon Fire TV gadgets during the first quarter of 2020, is new video chat support.

People who own the second-generation Fire TV Cube will soon be able to add a Logitech webcam for video chat through Fire TV. It’ll support Alexa video calls and, later, Zoom. It won’t work on the Fire TV sticks since it requires a USB port that’s only found on the Fire TV Cube.

New Amazon Fire TV Sticks price and release date

The new Amazon Fire TV Stick

Amazon

The Fire TV Stick and Fire TV Stick are relatively similar. They’ll cost $39.99 and $29.99, respectively. The Fire TV Stick offers support for newer technologies, like HDR and Dolby Atmos if your TV and speakers support them. Neither support 4K video and are capped at 1080p, so, don’t buy them if you have a 4K TV and want the best quality possible.

If you need 4K, look at the Fire TV Stick 4K, which costs $49.99 but doesn’t ship with the new software. The Fire TV Stick Lite is more basic without Dolby Atmos and some of the more advanced Wi-Fi support for more stable streaming. Both are said to be 50% faster than the last-generation Fire TV Stick, however, and both come with voice remotes that you can use to speak with Alexa to open movies, TV shows, apps and more.

Pre-orders for the new Fire TV Stick and Fire TV Stick Lite begin on Thursday and they’ll begin arriving to customers on Sept. 30.

Subscribe to CNBC on YouTube. 

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Spotify CEO to invest over $1 billion for ‘moonshot’ bets in Europe

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Spotify CEO Daniel Ek

Toru Yamanaka | AFP/Getty Images

LONDON — Spotify CEO Daniel Ek announced Thursday that he will commit 1 billion euros ($1.2 billion) of his own resources to invest in European start-ups.

Speaking at a virtual talk hosted by start-up event organizer Slush, Ek said he would use the funds to make “moonshot” bets in the continent, focusing on deep technology — new tools that are focused on scientific innovation. Among the sectors Ek is looking to invest in are health, education, machine learning and biotechnology.

“I want to do my part; we all know that one of the greatest challenges is access to capital,” Ek said, adding he wanted to achieve a “new European dream” — akin to that of the American Dream — over the next decade.

According to Forbes, Ek is worth $3.6 billion, indicating he’s earmarking roughly a third of his own wealth for the investments.

Ek spoke of his frustration with the number of European tech companies being bought up by U.S. rivals, as well as a brain drain of talented entrepreneurs leaving the region for Silicon Valley. One of the most notable examples of European entrepreneurs heading to the U.S. is payments giant Stripe, whose Irish founders went to California to build their company.

“I get really frustrated when I see European entrepreneurs giving up on their amazing visions selling early on to non-European companies, or when some of the most promising tech talent in Europe leaves because they don’t feel valued here,” Ek said. “We need more super companies that raise the bar and can act as an inspiration.”

Europe is often seen as lagging the U.S. and China with respect to technology. While those two economic powerhouses have produced some of the world’s biggest tech companies — Amazon, Microsoft, Tencent and Alibaba, to name a few — Europe is yet to offer a similar scale of success in the industry.

Last year, a record $34.3 billion flowed into Europe’s fledgling tech start-ups, according to figures from venture capital firm Atomico. Companies in the region have continued to raise substantial sums of cash this year, with “buy now, pay later” service Klarna raising $650 million and digital banking app Revolut securing $580 million in fresh funds.

Ek said he will work with scientists, investors, and governments to make his investments. A $1.2 billion fund would see the Spotify founder competing with well-established venture funds like Atomico — itself founded by former Skype CEO Niklas Zennström — Balderton Capital and Northzone.

Another issue in the region’s tech ecosystem has been initial public offerings. Spotify, which is based in Stockholm, Sweden, listed in New York over two years ago, while London-based online luxury marketplace Farfetch also chose America for its market debut. Europe has lagged behind in terms of tech IPOs this year, while a raft of software companies are going public in the U.S.

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Former Cambridge Analytica boss banned from running companies

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Alexander Nix, CEO of Cambridge Analytica, center, arrives at the offices of Cambridge Analytica in central London, Britain, March 20, 2018.

Henry Nicholls | Reuters

LONDON — Alexander Nix, the former chief executive of Cambridge Analytica, has been banned from running limited companies in Britain for seven years. 

The U.K. Insolvency Service announced the decision Thursday, saying Nix permitted companies to offer potentially unethical services to prospective clients. The 45-year-old, who lives in West London, has agreed not to take any holding company directorships from early next month.

Limited companies in the U.K. restrict the liability of the people that run them, and are similar to corporations in the U.S.

In addition to being a Cambridge Analytica director, the Eton-educated entrepreneur was also a director at parent company SCL Elections.

The Insolvency Service said the ban was issued on the basis that Nix caused or permitted SCL Elections to offer “unethical services” including bribery and honeypot stings, voter disengagement campaigns, the obtaining of information to discredit opponents and spreading information anonymously in political campaigns. 

Cambridge Analytica became infamous after it emerged the company had improperly gained access to the sensitive user information of as many as 87 million Facebook users without their knowledge or permission. The information was used by the Donald Trump campaign ahead of the 2016 U.S. presidential election. 

Nix was also recorded on hidden camera implying the research firm used manipulation and bribery to learn information on political candidates.

Mark Bruce, chief investigator for the Insolvency Service, said in a statement: “Following an extensive investigation, our conclusions were clear that SCL Elections had repeatedly offered shady political services to potential clients over a number of years.”

In a statement shared with CNBC, Nix pointed out that several investigations have concluded that he did not break any laws. 

“In relation to my undertakings to the Secretary of State, I have made no admission of wrongdoing and importantly the Government did not seek to press that I had breached any laws,” he said. 

Nix added: “After two and a half years of investigations, based on a litany of false allegations originated by a disgruntled former employee, I decided to bring this chapter to a close and avoid an unnecessary lengthy and expensive court case.”

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