Hedge Fund Founder Charged with Mismarking Securities

 A New York hedge fund founder was arrested Wednesday on charges that he exaggerated his company’s performance by over $200 million to impress and preserve investors.

Anilesh Ahuja, 49, of Manhattan, was charged with conspiracy, securities fraud and wire fraud.

Federal officials said that the founder, chief executive officer and chief investment officer of the investment firm Premium Point Investments LP had carried out a fraud from 2014 through 2016 that was designed to make investors believe that the firm’s hedge funds were doing much better than they were. Between 2008 and 2016, the firm managed billions of dollars in assets, exceeding $5 billion at one time at its peak, authorities said.

Amin Majidi, 52, of Armonk, New York, a former Premium Point portfolio manager, and Jeremy Shor, 46, of Manhattan, a former trader at the firm, also were charged. A lawyer for Ahuja did not immediately comment. A lawyer for Majidi declined comment. An attorney for Shor did not immediately return a message.

“By allegedly cooking the books, Ahuja and his co-defendants made the fund appear more attractive to would-be investors and dissuaded current investors from withdrawing their investments,” said Audrey Strauss, a federal prosecutor.

William F. Sweeney Jr., head of the New York FBI office, said in a release that the defendants’ “alleged practice of intentionally misleading investors and mismarking securities held in the funds they managed allowed them to charge higher fees and hold captive money that would have likely been withdrawn had their clients been aware of the hedge fund’s actual value.”

According to an indictment, Ahuja started his firm in 2008 and launched the company’s flagship mortgage credit fund a year later. After the firm began overstating the net asset value of its funds by more than $200 million at times, it was able to charge investors higher management and performance fees and could forestall redemptions, authorities said.

Prosecutors also announced Wednesday that the firm’s former chief risk officer and a former salesman at a broker-dealer have pleaded guilty to charges and are cooperating.

The Securities and Exchange Commission also filed civil charges against Ahuja, Majidi and Shor.

“Investors rely on their investment advisers to fairly and accurately value securities, and that is especially true when the securities trade in opaque markets,” said Daniel Michael, chief of the SEC’s Complex Financial Instruments Unit.  “As we allege, Premium Point masked its true performance, which denied investors the opportunity to make informed investment decisions.”

OPEC Source: Saudi Arabia Will Not Act Alone to Fill Any Iran Oil Shortfall

Saudi Arabia is monitoring the impact of the U.S. withdrawal from the Iran nuclear deal on oil supplies and is ready to offset any shortage but it will not act alone to fill the gap, an OPEC source familiar with the kingdom’s oil thinking said.

U.S. President Donald Trump on Tuesday abandoned a nuclear deal with Iran and announced the “highest level” of sanctions against the OPEC member. The original agreement had lifted sanctions in exchange for Tehran limiting its nuclear program.

Iran is the third-largest oil producer in the Organization of the Petroleum Exporting Countries after Saudi Arabia and Iraq.

During the last round of sanctions, Iran’s oil supplies fell by around 1 million barrels per day (bpd), but the country re-emerged as a major oil exporter, especially to refiners in Asia, after sanctions were lifted in January 2016.

“People shouldn’t take it for granted that Saudi Arabia will produce more oil single-handedly. We need to assess first the impact if there is any, in terms of disruption, in terms of a reduction of Iran’s production,” the OPEC source said Wednesday.

“We have managed to put together this new alliance between OPEC and non-OPEC. Saudi Arabia will not in any way act independently of its partners.”

Riyadh is working closely with the United Arab Emirates (UAE), which holds OPEC’s presidency in 2018 and non-OPEC producer Russia for “coordination and market consultations,” the OPEC source said.

He said any action would be taken in coordination with all OPEC and non-OPEC partners, if needed.

OPEC’s oil supply-cutting deal with non-OPEC producers such as Russia has helped to clear a global oil supply glut and boost prices. The agreement is due to expire at the end of 2018.

OPEC officials from Saudi Arabia, the UAE and Russia along with few other producers in the pact are due to meet in Saudi Arabia on May 22-23 as part of a monthly meeting for the Joint Technical Committee which monitors the oil market.

Saudi Arabia, the world’s largest oil exporter and top OPEC producer, is concerned about any negative impact from the potential oil supply shortage for oil-consuming countries, the OPEC source said.

But Saudi Arabia has enough oil production capacity — currently at 12 million barrels per day (bpd) — to maintain oil market stability, the OPEC source also said.

Iran produces about 3.8 million bpd. Since the Iran nuclear deal went into effect, its exports have risen to about 2.5 million bpd, from less than 1 million bpd. A majority goes to Asia, with Europe receiving about 600,000 bpd.

Analysts now expect Iran’s supplies to fall by between 200,000 bpd and 1 million bpd, depending on how many other countries fall in line with Washington.

Trump and oil prices

Expectations that new U.S. sanctions could hit Iranian crude exports and feed tensions in the Middle East had pushed oil prices higher in the past few weeks.

Brent crude was trading about $77 at a 3-1/2 year high on Wednesday, raising concerns that prices were going too high too fast.

Trump accused OPEC last month of “artificially” boosting oil prices in a message on Twitter, the first time he has mentioned OPEC on social media.

His tweet was seen by OPEC sources as the U.S. president’s way to appease a domestic audience unhappy about a rise in gasoline prices.

A key U.S. ally, Saudi Arabia welcomed Trump’s decision to withdraw from the nuclear agreement with Iran and to reimpose economic sanctions.

Riyadh also said it would work with OPEC and non-OPEC to lessen the impact of oil shortages in a clear indication that the country has been coordinating with Washington ahead of time, sources familiar with the matter said.

“You need to work with your partners in dealing with any potential effect on supply,” the OPEC source said.

“But it should be done in a collective coordinated way and that can only happen when you start to be able to assess what would be the impact.”

OPEC and non-OPEC meet next in June and they are widely expected to keep supply curbs in place until the end of 2018.

But a drop in Iranian exports due to U.S. sanctions, plus supply disruptions in other OPEC members, such as Venezuela, could reduce supply more than planned, leading to a potential price spike.

But the OPEC source said a rise in prices due to the market’s worries about supply should not be the parameter for OPEC to adjust output.

The OPEC source said any decision in June to raise output “should be driven by a potential physical shortage or reduction in production from any oil supply source not only Iran.”

“You only handle [output] when you have a semi-clear idea of what would be the potential impact. It is too early now to do that,” the source said.

He also said Saudi Arabia does not expect any physical impact on the oil market from the U.S. Iran sanctions until the third or fourth quarter of this year.

OPEC’s objective is still to reduce global oil inventories to an acceptable level, and any adjustment in production targets should be done in a coordinated way, the OPEC source said.

“This way you do not disrupt a mechanism that we have worked hard to put together and to sustain just to address a short-term issue,” the source said.

New Shoppers Can Try Alexa in Amazon Model ‘Smart’ Homes

Amazon.com Inc on Wednesday said it has set up model “smart” homes across the United States for shoppers to experience what it’s like for voice aide Alexa to dim the lights, turn on the TV or order more laundry detergent.

The rollout underscores how Amazon aims to make Alexa and the company’s growing list of services, from shopping and entertainment to home security, an everyday part of consumers’ lives. It also steps up competition with retailers such as Best Buy Co Inc that focus on showcasing technology and advising shoppers.

Amazon, the world’s largest online retailer, said it has partnered with Lennar Corp to convert some of the home construction company’s model homes into showrooms for Alexa. The so-called “Amazon Experience Centers” are now open near 15 cities including Los Angeles, Dallas and Washington, with more to come.

“Today, the choices open to customers are, you can go to a brick-and-mortar store and you can see devices on demo tables. You go online and do your research. But you fundamentally are left to imagine what an integrated home would look like,” said Nish Lathia, general manager of Amazon Services, in the company’s Vallejo, California, experience center outside San Francisco.

The centers are “intended to educate and inspire. On the secondary benefit, yes, if it drives sales, we’re not complaining,” he said.

David Kaiserman, president of Lennar Ventures, said the centers should increase traffic to Lennar’s model homes and spark ideas for potential home buyers. Lennar will get a standard commission for Amazon sales to customers it helped acquire, too.

The global smart home market is expected to reach an estimated $107.4 billion by 2023, according to market research firm ReportLinker.

Best Buy is betting big on this trend. It has expanded its In-Home Advisor program to all major U.S. markets and employs more than 350 advisers under the initiative, its most recent annual report said.

Experts visit customers’ homes and consult on issues from increasing appliance efficiency to setting up connected gadgets — similar in nature to Amazon’s 1.5-year-old “Smart Home Services,” which is poised to gain from the new experience centers.

“We’re excited about Best Buy’s program,” said Amazon’s Lathia. “The more customers that get educated about smart home, the better it is for everybody.”

Philippe Ferrey, an Amazon Expert present at the Vallejo center, previously worked five years for Best Buy as a Geek Squad agent, he said.

Lego Builds Miniature Windsor Castle to Celebrate Royal Wedding

Attraction park Legoland has unveiled a miniature model of this month’s royal wedding of Prince Harry and Meghan Markle at Windsor castle, built by a team of 11 model-makers who used almost 60,000 pieces of Lego bricks.

The replica includes a 60-brick Markle in her wedding dress and veil, with Harry by her side.

The couple are riding in a brick-built carriage being drawn by horses along Windsor Great Park’s Long Walk toward the castle, surrounded by 500 spectators, recreating the real-life procession that is planned for the big day on May 19.

The scene is completed by miniature models of Queen Elizabeth and the Duke of Edinburgh along with best man Prince William, his wife, Kate, and their children, Prince George and Princess Charlotte, and Meghan Markle’s parents.

Lego said the wedding scene replica, which took 752 hours to build, will be on permanent display at its theme park, just three miles (5 km) from the real Windsor castle to the west of London.

Oscar-Winning Iranian Urges Tehran: Let Banned Director Go to Cannes

The double-Oscar winning filmmaker who opened the Cannes Film Festival has made a last-minute plea to Iran to let a fellow Iranian director – who is officially banned from working and traveling – come to the premiere of his own film.

Seated alongside Javier Bardem and Penelope Cruz, the stars of his new movie, Asghar Farhadi said Iran should allow acclaimed director Jafar Panahi to attend the festival where they both have movies competing for the Palme d’Or.

“I think there’s still time,” he said of getting Panahi to the Saturday premiere of his film “3 Faces.”

“I would like to send this message: I hope the decision will be taken to allow him to come,” Farhadi said at the end of a news conference on his own movie “Everybody Knows” on Wednesday.

Farhadi, who won foreign language Oscars for films made in Iran: “A Separation” and “The Salesman”, is free to come and go from his home country as he makes films there and in Europe.

But Panahi, who won the Camera d’Or in Cannes in 1995 for his debut “The White Balloon” was arrested after the 2009 protests against the re-election of hardline president Mahmoud Ahmadinejad and was banned from making films.

Depite that, he has continued working under the radar, starting with “This Is Not a Film,” shot in his Tehran apartment on a mobile phone, and more recently “Taxi” in which he plays himself as a film director now working as a taxi driver – winning the Golden Bear for best film at the Berlin film festival in 2015.

“It’s wonderful that he has continued his work in such adversity,” Farhadi told reporters. “It’s a very strange feeling for me to be able to be here but not him. It’s something I have difficulty living with.”

The gala screening of “Everybody Knows” on Tuesday evening coincided with U.S. President Donald Trump’s announcement that he was pulling of the 2015 nuclear deal – delivering a bitter-sweet moment for Iranians.

“It was a very strange moment, to have come out of the film and have all the emotions about how good or bad the film was and also the real, real worries that we have about the future of our country,” said Arash Azizi, a New-York based Iranian movie critic for website IranWire.

“Unfortunately, the reality of the world is that our fate is not being decided not by the Farhadis or other artists but by Trump or (Iranian supreme leader Ayatollah Ali) Khamenei – men in power who represent a very different face of Iranians.”

The Cannes Film Festival runs from May 8 to May 19.

 

Good Feeling, or Bad Feeling About Young Han Solo? ‘Star Wars’ Fans Wait and See

The new, young Han Solo says he has “a good feeling about this” in a trailer for “Solo: A Star Wars Story,” reversing one of the best-known catchphrases in the sci-fi movie franchise.

Yet fans are watching to see if a little-known actor can fill the shoes of Harrison Ford, whose dry-witted bounty hunter is one of the franchise’s most popular characters.

All eyes will be on Alden Ehrenreich, 28, when Disney’s “Solo” gets its world premiere in Los Angeles on Thursday ahead of an international rollout on May 23.

“Solo” is an origin story set some 10 years before the events of the 1977 “Star Wars” movie, when Ford starred as the cynical cowboy space pilot. He reprised the role almost 30 years later for “The Force Awakens,” which at $2 billion is the third biggest-grossing film on record.

“Han Solo is my favorite character in ‘Star Wars’ and Harrison Ford is a big part of that,” said Sarah Woloski, co-host with Tricia Barr and Teresa Delgado of “Star Wars” podcast Fangirls Going Rogue.

“But if Alden has the right swagger and attitude to pull that off, that’s more important than being a Harrison Ford look-alike,” she said.

Ehrenreich got warm reviews for quirky 2016 comedy “Hail, Caesar” but is otherwise little known to generations of fervent “Star Wars” fans.

On the other hand, Ford, now 75, became a taciturn sex symbol, a persona that grew with his “Indiana Jones” adventures.

Yet his alpha male Han Solo of the 1970s and 80s may not be the hero audiences want in 2017.

“I think a lot of heterosexual men learned how to flirt from Han Solo and Indiana Jones. But men like me grew up and realized you can’t act like Han Solo. Han Solo is kind of a jerk,” said Ryan Britt, entertainment editor of pop culture and technology at website Inverse.com.

“If Alden’s sexy, I don’t think he can be as pushy as the Han Solo of the 80s,” Britt said.

Trailers for “Solo,” including some deadpan lines from co-screenwriter Lawrence Kasdan, have excited fans who were initially nervous about Ehrenreich’s casting.

They are also hoping the film will explain Han Solo’s back story, including his friendship with co-pilot Chewbacca, how he won the Millennium Falcon spaceship, and how he became the cynic whose catchphrase “I have a bad feeling about this” has been used in some form in almost every “Star Wars” movie.

“Why did he lose his idealism? Does he get his heart broken? Does he get ripped off? Does he get betrayed?” said Britt.

The biggest surprise may come in the form of Donald Glover, the singer and actor who plays a young version of smuggler Lando Calrissian.

“I might be more excited about Lando, and seeing the swagger of Donald Glover, than seeing Han Solo,” said Delgado, who plans to see “Solo” three times over its opening weekend.

“I can’t imagine he will be anything less than awesome and swoon-worthy.”

 

 

 

 

 

A New Silicon Valley Where You’d Least Expect It

Silicon Valley — the U.S. hub of technology– is getting so expensive that tech workers are struggling to get by, and start up companies are questioning whether to locate there. One city thousands of kilometers away is ready to welcome tech companies with an experienced workforce in hopes of becoming the next Silicon Valley. VOA’s Carolyn Presutti takes us to the city and shows us a new tech university that could be replicated anywhere in the world.

Tackling Rabies in Malawi, One Dog at a Time

A team of veterinarians has again traveled to southern Malawi to vaccinate thousands of dogs as part of a global effort by the British charity, Mission Rabies, to eradicate the deadly virus by 2030. Malawi has in the past reported elevated numbers of child deaths from rabies, but now three years into this initiative, the organizers say they are seeing signs of progress. Lameck Masina reports for VOA from Blantyre.

Disney Teases Possibility of More ‘Avengers’ Movies

More “Avengers” movies could be on their way, Disney said on Tuesday, following the global success of “Avengers: Infinity War,” which has smashed box office records since its release last month.

Walt Disney Chief Executive Bob Iger told analysts on an earnings call that the fourth, already announced “Avengers” movie in the Marvel comic book franchise, due to be released in May 2019, would have a “significant conclusion.”

But, Iger added, “Given the popularity of the characters and given the popularity of the franchise, I don’t think people should conclude that there will never be another ‘Avengers’ movie.”

“There’s certainly a lot more stories to tell, a lot more characters to populate those stories with,” he said.

“Avengers: Infinity War,” which brought together more than 20 Marvel superheroes, set a new opening weekend box office record for North America of $250 million when it debuted at the end of April.

The movie has earned more than $1 billion globally, even before it opens in China.

Directors Joe and Anthony Russo shot an as yet untitled follow-up back-to-back with “Infinity War.” That movie is scheduled for release on May 3, 2019. Details of the plot have not been released.

Iger added that Disney would also likely “try our hand at what I’ll call a new franchise beyond Avengers,” noting that there were some 7,000 characters in the Marvel universe that could be explored in film.

Iger was speaking after Disney announced quarterly profits that topped Wall Street forecasts, partly based on the success of Marvel movie “Black Panther.”

Disney already has two other Marvel movies set to be released within the next year — “Ant-Man and the Wasp” in July, and “Captain Marvel” in March 2019.

US Trade Embargo Has Cost Cuba $130B, UN says

A United Nations agency said on Tuesday an “unjust” U.S. financial and trade embargo on Cuba had cost the country’s economy $130 billion over nearly six decades, coming up with the same estimate as the island’s communist government.

Although many U.S. allies join Washington in criticizing Cuba’s one-party system and repression of political opponents, the United States has lost nearly all international support for the embargo since the collapse of the Soviet Union.

The U.N. has adopted a non-binding resolution calling for an end to the embargo with overwhelming support every year since 1992. In a report ahead of the vote last year, Cuba estimated total damage from the embargo at $130 billion.

“This country which welcomes us today .. is testing its own ways to face the brutal human costs that it has sustained during an unjust blockade,” the head of the U.N.’s regional economic body for Latin America, ECLAC, Alicia Barcena told its biennial meeting in Havana on Tuesday.

“We evaluate it every year as an economic commission and we know that this blockade costs the Cuban people more than $130 billion at current prices and has left an indelible mark on its economic structure,” she said, without detailing how the organization came to that estimate.

After agreeing to a historic U.S.-Cuban detente in 2014, former U.S. President Barack Obama eased the embargo, which was fully put into place in 1962. But U.S. President Donald Trump last year tightened travel and trade restrictions again. Only the U.S. Congress can lift it in full.

“Despite the difficulties the Cuban economy is faced with, particularly due to the intensification of the blockade imposed on Cuba… we will continue to focus on the development goals set,” Cuban President Miguel Diaz-Canel said in his opening remarks at the meeting, attended also by U.N. Secretary-General Antonio Guterres.

Cuba’s Soviet-style, centralized economy has grown just 2.4 percent on average per year over the past decade, official statistics show, much less than the 7 percent annual expansion the government has estimated it needs in order to develop.

Cuba hoped market reforms introduced in the last decade would boost growth, but they have so far borne mixed results.

The ruling Communist Party earlier this year admitted implementation had been harder than expected.

ECLAC will support Cuba’s reform program, Barcena said.

Trump to Allow Year-Round Sales of High-Ethanol Gas

President Donald Trump will allow year-round sales of renewable fuel with blends of 15 percent ethanol as part of an emerging deal to make changes to the federal ethanol mandate.

 

Republican senators and the White House announced the deal Tuesday after a closed-door meeting, the latest in a series of White House sessions on ethanol.

 

The Environmental Protection Agency currently bans the 15-percent blend, called E15, during the summer because of concerns that it contributes to smog on hot days. Gasoline typically contains 10 percent ethanol. Farm-state lawmakers have pushed for greater sales of the higher ethanol blend to boost demand for the corn-based fuel.

 

Iowa Sen. Chuck Grassley called the agreement good news for farmers and drivers alike, saying it would increase ethanol production and consumer choice at the pump.

 

Texas Sen. Ted Cruz said the deal will save the jobs of thousands of blue-collar workers at refineries in Texas, Pennsylvania and other states.

 

“Terrific final decision from @POTUS meeting,” Cruz tweeted. “This is a WIN-WIN for everyone.”

 

The decision allowing E15 to be sold year-round will provide “relief to refiners” and “protect our hardworking farmers and refinery workers,” White House spokeswoman Lindsay Walters said. “The president is satisfied with the attention and care that all parties devoted to this issue.”

 

Trump met Tuesday with Grassley, Cruz, Iowa Sen. Joni Ernst and Pennsylvania Sen. Pat Toomey, as well as EPA Administrator Scott Pruitt and Agriculture Secretary Sonny Perdue.

 

The EPA oversees the decade-old Renewable Fuel Standard, commonly known as the ethanol mandate, which sets out how much corn-based ethanol and other renewable fuels refiners must blend into gasoline. The program’s intent was to address global warming, reduce dependence on foreign oil and bolster the rural economy by requiring a steady increase in renewable fuels over time.

 

The mandate has not worked as intended, and production levels of renewable fuels, mostly ethanol, routinely fail to reach minimum thresholds set in law.

 

Environmental groups criticized the deal, saying it would worsen air pollution during summer months.

 

“Waiving clean-air standards at the behest of one favored industry would not only set a precedent for bad policy, it could cost lives,” a coalition of environmental groups said in a statement.

 

Ernst said allowing year-round sale of E15 “will drive up domestic ethanol production and consumption” while helping to “maintain already low prices” for fuel credits that oil refiners must buy if they can’t blend ethanol into their fuels.

 

She and Grassley also said they were encouraged that the Trump administration will take a closer look at “hardship” waivers that have been granted to small refineries, a practice they say has hurt biofuels and undermined the RFS.

 

The EPA has reportedly granted a waiver to a refinery owned by billionaire Carl Icahn, a former Trump adviser, as well as other small refineries. The agency has not disclosed which refineries received the waivers, saying it did not want to reveal private business information.

 

Cruz said the president also agreed to consider his proposal to include fuel credits for ethanol that is produced domestically and exported. The proposal is meant to make it easier for the industry to meet annual sales volumes required under the renewable-fuel mandate.

 

“This is good for farmers, refiners and America,” Cruz said in a statement.

 

But the Renewable Fuels Association, an industry group, said allowing exports to qualify for RFS compliance could dramatically reduce domestic demand and result in retaliatory trade barriers from countries that import U.S. ethanol.

 

The group’s president, Bob Dinneen, called the export idea a “disgrace” and said ethanol producers and farmers would bear the brunt of any retaliatory tariffs.

China Cuts US Soybean Purchases

With the threat of tariffs and counter-tariffs between Washington and Beijing looming, Chinese buyers are canceling orders for U.S. soybeans, a trend that could deal a blow to American farmers if it continues.

At the same time, farmers in China are being encouraged to plant more soy, apparently to help make up for any shortfall from the United States.

 

Beijing has included soybeans on a list of $50 billion of U.S. exports on which it has said it would impose 25 percent tariffs if the United States follows through on its threats to impose the same level of tariffs on the same value of Chinese goods. The U.S. tariffs could kick in later this month; China would likely retaliate soon after.

It can take a month or longer for soybean shipments to travel from the U.S. to China. Any soybeans en route to China now could be hit by the tariff by the time they arrive.

“The Chinese aren’t willing to buy US soybeans with a 25 percent tax hanging over their head,” said Dan Basse, president of AgResource, an agricultural research and advisory firm. “You just don’t want the risk.”

China typically buys most of its soybeans from South American nations such as Brazil and Argentina during spring and early summer. It shifts to U.S. soybeans in the fall. As a result, for now, the cutbacks from the United States are relatively small.

But should they persist, it could cause real pain to U.S. farmers. Roughly 60 percent of U.S. soybeans are shipped to China.

There might also be a political impact: Three of the top five soybean-exporting states — Iowa, Indiana and Nebraska — voted for President Donald Trump in 2016.

Illinois, the top soybean exporter, and Minnesota, the third-largest, backed Hillary Clinton.

Basse said that it has been roughly three weeks since China has made any major soybean purchases, an unusually long delay.

Some Chinese buyers might be showing support for their government in the trade dispute by turning away U.S. soybeans, Basse said. The dispute may also make it seem too risky to buy from the United States over the long run.

“The United States could lose the reliable supplier label that we’ve had these many years,” Basse said.

Data from the U.S. government data show that sales of soybeans have fallen from about 255,000 metric tons in the first week of April, when the trade dispute began, to just 7,900 in the week that ended April 26.

Cancellations have also jumped, to more than 140,000 metric tons in the week ending April 26. In the same week last year, there were no canceled sales at all.

Some analysts argue that the shifts aren’t yet particularly significant. China buys most of its soybeans from the United States in the late summer and fall, and then switches to South American sources, mainly Brazil and Argentina, in the spring. So the current market activity doesn’t necessarily reflect the pattern that would occur during the main buying season.

“These numbers we’re talking about are pretty minor,” said John Baize, an economist for the U.S. Soybean Export Council.

The U.S. ships about 35 million metric tons of soybeans to China a year, Baize said. China usually imports about 100 million tons a year and can’t import enough from other countries, he said, to abandon the United States as a source.

“Where’s China going to buy its beans?” Baize asked.

That may be true in the short run. But Basse suggests that Brazil has enough land that could be used for soybean cultivation that it could soon mostly replace the United States as a supplier to China.

And if the Chinese market were to be closed to U.S. farmers, they might be able to sell some portion of their soybeans to other markets. Baize said that huge multinational companies, such as Cargill and ADM, might, for example, sell more U.S. soybeans to Europe, where they wouldn’t face any tariffs, though this likely wouldn’t make up for the loss of the Chinese market.

At the same time, China is looking more to its own farmers. Since China announced its potential tariffs on U.S. soy in April, the government has encouraged farmers to cultivate more soybeans. Beginning this month, Chinese farmers say, Beijing reduced corn subsidies and raised annual soybean subsidies from 2550 yuan ($400) per hectare to 3000 yuan ($470) or more per hectare in major soybean-producing provinces in northeast China.

An adjustment had already been planned to help draw down China’s substantial corn stockpiles, so the change wasn’t necessarily aimed at U.S. soy growers, analysts say.

But the subsidy adjustment did come with political undertones. Officials in major soybean-producing provinces were describing the promotion of local soybeans as “the most important political task in agricultural production at present.” Heilongjiang in northeast China announced a pilot project to plant soybeans on over 100,000 new hectares, with an extra 2,250 yuan ($353) subsidy per hectare.

The moves are prompting farmers like Liu Cong to focus more on growing soy. Liu says he used most of his land to grow corn last year but this year is planting more soybeans.

“This is encouraging for farmers,” he said in a phone interview. “We’re more motivated.”

Zhang Xiaoping, China director for the U.S. Soybean Export Council, says that Chinese buyers have been canceling soybean purchases of last year’s U.S. soybean harvest because of the threat of tariffs.

“The buyers literally stopped buying from the U.S.,” Zhang said. “Exporters cannot find any buyers in China.”

US Drug Supply Firm Execs: They Didn’t Cause Opioid Crisis

Top executives of the nation’s leading wholesale drug distributors told Congress under oath Tuesday that their companies didn’t help cause the nation’s deadly opioid epidemic, drawing bipartisan wrath that included one lawmaker suggesting prison terms for some company officials.

 

The confrontation came at a House subcommittee hearing at which legislators asked why huge numbers of potentially addictive prescription opioid pills had been shipped to West Virginia, among the states hardest hit by the drug crisis. Lawmakers are making an election-year push for legislation aimed at curbing a growing epidemic that saw nearly 64,000 people die last year from drug overdoses, two-thirds from opioids.

 

Company officials’ responses ranged from apologies to explanations to finger-pointing at doctors who prescribe the drugs, pharmacies that fill prescriptions and the federal Drug Enforcement Administration for not doing enough as overseer of sales of legally controlled substances.

In a scene that recalled Congress’ 1994 grilling of tobacco industry officials, House Energy and Commerce investigations subcommittee Chairman Gregg Harper, R-Miss., administered oaths to the heads of five pharmaceutical distributors and asked each if “the actions you or your company took contributed to the opioid epidemic.”

 

Answering no were the leaders of the nation’s three biggest distribution firms: McKesson Corp., Cardinal Health Inc. and AmerisourceBergen Corp., which dominate the U.S. market. The only yes came from Joseph Mastandrea, chief of the smaller Miami-Luken Inc., while the former chief of H.D. Smith Wholesale Drug Company also said no.

 

The denials drew an angry response from GOP Rep. David McKinley of West Virginia, where federal figures show 884 people died from drug overdoses in 2016. That gives the state the nation’s highest overdose death rate — 52 out of 100,000 people. Other states with high death rates included Ohio, Pennsylvania and New Hampshire, plus Washington, D.C.

 

“The fury inside me right now is bubbling over,” said McKinley. He said he found the denial of responsibility “particularly offensive” and he wondered aloud about the proper punishment.

 

“Just a slap on the wrist, some financial penalty?” he asked. “Or should there be time spent for participation in this? I just want you to feel shame.”

 

Members of both parties accused company officials of missing signs of suspicious activity. The government requires distributors of controlled substances to report suspicious drug orders to the federal Drug Enforcement Administration and to deny questionable transactions.

 

The committee’s investigation has found that distributors sent more than 780 million pills of hydrocodone and oxycodone — prescription pain-killers that have caused many deaths — to West Virginia from 2007 to 2012. Around 1.8 million people live in the state.

 

Investigators said 20.8 million opioid pills were shipped from 2006 to 2016 to Williamson, population 2,900. One pharmacy in Kermit, with around 400 residents, ranked 22nd in the U.S. in the number of hydrocodone pills it received in 2006, according to the investigation.

“Was it the profit motive” that prompted them to continue making dubious sales, asked Rep. Cathy Kastor, D-Fla.

 

The corporate executives said they’ve improved their detection systems — a promise lawmakers said they’d heard before. The officials also acknowledged responsibility for fixing the problem but said that was divided with others, too. Nearly 12 million people misused opioids in 2016, according to federal figures.

 

“It’s a shared responsibility among many different players: physicians, pharmacists, state medical boards, state pharmacy boards, DEA” for solving the problem, said Mastandrea.

 

In some cases, they apologized.

 

“To the people of West Virginia, I want to express my personal regrets for judgments that we’d make differently today,” said George Barrett, executive board chairman of Cardinal Health.

The Trump administration and lawmakers of both parties have been drawing attention to opioids, a range of pain-killing drugs that can be addictive when misused. They include prescription drugs like hydrocodone, oxycodone and codeine, synthetic opioids like fentanyl that can be made illegally, and illegal drugs like heroin.

 

House and Senate committees have been working on dozens of bills that include encouraging doctors to use non-addictive pain killers, spurring research on such products, broadening access to treatment and giving financial incentives for drug treatment specialists to work in underserved areas.

 

In 1994, tobacco company executives testified before the Energy and Commerce panel, then controlled by Democrats. The officials said they didn’t believe cigarettes were addictive, despite evidence to the contrary.

 

Within four years, the industry reached a settlement to pay states more than $200 billion over 25 years for tobacco-related health care costs.

US Lawmakers’ Help Sought on Use of Encrypting Apps

A digital rights organization has asked congressional leaders for help in persuading Google and Amazon to support a technology that people in authoritarian countries use to get around censorship controls worldwide.

In a letter sent this week, Access Now, which is based in New York, sought to put pressure on Google and Amazon, which decided recently to close a loophole that allowed some encrypted-communication apps to assume a disguise as messages moved through the internet.

Access Now asked for help from leaders of the House and Senate foreign affairs committees, the House and Senate commerce committees and the Congressional Executive Committee on China.

At issue is the ongoing cat-and-mouse game between governments, such as Russia, Iran and China, and those who use internet and messaging technologies, like Telegram and Signal, to communicate outside censors’ oversight.

In this case, encrypted-messaging apps have been using a digital disguise known as “domain fronting.” Some of these technologies have received financial support from the Open Technology Fund, a U.S. government program funded by Radio Free Asia and the Broadcasting Board of Governors, the agency that oversees Voice of America.

Disguising final destination

As an encrypted message moves through networks, it appears to be going to an innocuous destination, such as google.com, by routing through a Google server, rather than its true destination.

If a government acts against the domain google.com, it conceivably shuts down access to all services offered by the internet giant for everyone in the country. The gamble is that governments wouldn’t want to cut off residents’ access to large swaths of the internet just to block a specific communication.

Russia did just that in mid-April when it sought to crack down on Telegram.

But it’s not just dissidents and religious or human rights activists who are using these apps. Hackers can also use this disguise to mask malware, according to ZDNet.

In recent weeks, first Google and then Amazon Web Services said they would close the loopholes that allowed apps to use the disguise.

“No customer ever wants to find that someone else is masquerading as their innocent, ordinary domain,” said Amazon in a news release announcing better domain protections.

“Domain fronting has never been a supported feature at Google,” a Google representative said. “But until recently it worked because of a quirk of our software stack. We’re constantly evolving our network, and as part of a planned software update, domain fronting no longer works. We don’t have any plans to offer it as a feature.”

Matthew Rosenfield, who helped develop the Signal technology, said that “the idea behind domain fronting was that to block a single site, you’d have to block the rest of the internet as well. In the end, the rest of the internet didn’t like that plan.”

Amazon sent Signal an email telling it that its use of circumvention was against Amazon’s terms of service. In Middle East countries, such as Egypt, Oman and Qatar, Signal disguised itself as Souq.com, Amazon’s Arabic e-commerce platform.

Letter to Congress

In its letter to Congress, Access Now wrote that “until this change by Amazon and Google, domain fronting was the most effective and most widely used method of enabling free speech, free association and freedom online in countries that aggressively filter and monitor internet access.”

“The end of domain fronting will not permanently impede progress toward our shared goal of global internet freedom, but it will set it back, and the adverse effects will be felt most direly by those already experiencing repressive censorship and surveillance,” the letter said.

Major Review Backs Cervical Cancer Shots, Especially for Teens

Vaccines designed to prevent infection with human papillomavirus (HPV) are effective in protecting against pre-cancerous cervical lesions in women, particularly in those vaccinated between age 15 and 26, according to a large international evidence review.

The research by scientists at the scientific network the Cochrane Review also found no increase in the risk of serious side effects, with rates of around 7 percent reported by both HPV-vaccinated and control groups.

“This review should reassure people that HPV vaccination is effective,” Jo Morrison, a consultant in gynecological oncology at Britain’s Musgrove Park Hospital, told reporters at a briefing about the review’s findings.

She noted that some campaign groups have expressed concern about HPV vaccines, but said this review had found no evidence to support claims of increased risk of harm.

HPV is one of the common sexually transmitted diseases. Most infections do not cause symptoms and go away on their own, but when the immune system does not clear the virus, persistent HPV infection can cause abnormal cervical cells.

These pre-cancerous lesions can progress to cervical cancer if left untreated. HPV is a leading cause of cancer deaths among women worldwide, according to the World Health Organization.

Drugmakers GlaxoSmithKline and Merck make vaccines that protect against HPV.

The Cochrane research pooled data and results from 26 studies involving more than 73,000 women across all continents over the last eight years.

The researchers found that in young women who tested negative for HPV, vaccination reduced the risk of developing precancer. About 164 out of every 10,000 women who got placebo developed cervical pre-cancerous lesions, compared with two out of every 10,000 who were vaccinated.

Looking more broadly across all women in the studies, regardless of whether they had previously had HPV or not, the vaccines were found to be slightly less effective, but still reduced the risk of cervical precancer from 559 per 10,000 to 391 per 10,000.

Experts not directly involved in the review said its findings were robust and important.

“This intensive and rigorous Cochrane analysis … provides reassuring and solid evidence of the safety of these vaccines in young women,” said Margaret Stanley, a specialist in the pathology department at Cambridge University. “It reinforces the evidence that preventing infection by vaccination in young women … reduces cervical precancers dramatically.”

Can Shutting Down Online Hate Sites Curb Violence?

GoDaddy has pulled the plug on another online peddler of violence.

The popular internet registration service last week shut down altright.com, a website created by white nationalist leader Richard Spencer and popular with many in the so-called alt-right movement.

The takedown is the latest example of how companies like GoDaddy are increasingly responding to growing public pressure to clamp down on violent sites in the wake of the deadly Unite the Right rally in Charlottesville, Virginia, last summer.

GoDaddy, which registers domains for more than 75 million websites around the world, said it generally does not delist sites that promote hate, racism and bigotry on the ground that such content is protected as free speech.

But it said altright.com had “crossed the line and encouraged and promoted violence in a direct and threatening manner.”

“In instances where a site goes beyond the mere exercise of these freedoms, however, and crosses over to promoting, encouraging or otherwise engaging in specific acts of violence against any person, we will take action,” GoDaddy said in a statement emailed to VOA.

The company would not say whether it canceled altright.com’s domain registration in response to pressure but it stressed that “we take all complaints about content on websites very seriously, and have a team dedicated to investigate each complaint.”

The Lawyers’ Committee for Civil Rights Under Law, a Washington-based civil rights organization, said it filed such a complaint with GoDaddy last month, citing several instances in which altright.com carried content that advocated violence.

In one example, a January 26, 2018, article encouraged “use of live ammunition at the border, in order to create a substantial chance that they [immigrants crossing the border] lose their life in the process,” according to the organization’s complaint.

Kristen Clarke, the group’s president and executive director, said the shutdown of altright.com was part of her organization’s campaign to combat a recent “hate crime crisis” in the United States.

“We know that so much hate that we see today originates online,” Clarke said. “It originates in dangerous platforms and online hubs that provide a space to people to essentially coordinate violence and incite people to violence.”

There is no tally of sites that promote violence on the internet. But Clarke said there are “too many” and that her organization is in talks with domain and web hosting companies to shut down close to a dozen of them. She declined to name the websites.

“We’re focused on some of the biggest platforms and places where we’re seeing some of the most dangerous and violent activity,” she said. “We’ll see if those efforts bear fruit.”

Spencer denounced the closure of his website.

“The Left will not stop their censorship crusade with the Alt-Right,” Spencer tweeted on Thursday. “They’re going to come for every right-wing website. Free speech will cease to exist if the GOP fails to enact legislation.”

Altright.com’s takedown comes as public scrutiny of hate sites has grown and internet intermediaries have started to strictly enforce their terms of service and acceptable use policies in the wake of the Charlottesville rally.

Prior to the rally, tech companies had largely left it to users to police online content. But after the march, social media and payment processing companies took steps to close the accounts of several white nationalist leaders, and hosting companies shut down websites associated with the movement such as The Daily Stormer and Stormfront.

“They did know that they had very hateful groups using their services but there didn’t seem to be either political or public pressure to get rid of them,” said Natasha Tusikov, a criminology professor at York University in Toronto.

After Charlottesville, “we saw a number of them suddenly become more pressured publicly and politically.”

Amid growing public pressure, she said, “I think we’re going to see more of these cases.”

But shuttering entire websites is not likely to eliminate violence-mongering online. For one, there is no dearth of small services that would host sites banished by others. Indeed, while The Daily Stormer and Stormfront were forced by their closure to hop from host to host for several months, they eventually found a home. Altright.com is likely to similarly resurface.

The crackdown can also push some websites underground into the dark web — content on networks that use the internet but require specific authorization to access — making it difficult to track them and find out “who their members are and what they’re doing,” Tusikov said. 

Tusikov said that what she finds even more problematic is the way in which these sites are shut down. Internet intermediaries such as GoDaddy give themselves “considerable” latitude to close websites for any number of reasons. 

“A lot of us would agree that any kind of hateful violent speech should be removed,” she said. “The question is in murkier areas, when it gets to other types of perhaps controversial speech but lawful speech.”

In the U.S. and other countries with a strong free-speech tradition, governments have largely shied away from regulating online content, leaving it to internet intermediaries to assume the role. But Tusikov said internet intermediaries are ill-equipped to distinguish between legal and illegal content. 

Instead, she said, policymakers should institute regulations such as the Manila Principles, a set of standards adopted by civil society groups and digital rights advocates in 2015. Among other things, the Manila Principles require that content restriction policies must “follow due process” and “comply with the tests of necessity and proportionality.” 

“So if you have one problem with one element of copyright infringement, you shouldn’t take the entire site down,” Tusikov said. “You should deal with that one problem.” 

Stay or Go? Volcano Forces Choice for All in Eruption Zone

Edwin Montoya’s family carved their farm on the slopes of the Kilauea volcano out of “raw jungle,” transforming it into a fertile collection of gardens, animal pens and fruit trees.

Now the property is imperiled by the very land it stands upon. A couple of miles up the hill, lava has destroyed dozens of homes, and his daughter’s farm is in an evacuation zone.

Despite the nearby danger, Montoya plans to stay unless he is forced to leave. “I’m going to go ahead and stick it out,” he said. “If it happens, if it blows its top and I’m there at the time, I’m 76 years old. I’ve lived a good life.”

Because there’s no indication when the eruption might stop, or how far the lava might spread, the volcano has forced people living in and around the Leilana Estates subdivision to make tough decisions.

Some residents insist on staying to watch over their property. Others have abandoned their homes without knowing when they will be able to return, or if they will come back to find their houses turned to ash and buried under solid rock.

Andrew Nisbet evacuated last week and has no idea what has happened since.

“My home is right in the line of the major breakouts so maybe, maybe not.” he said Monday during a community meeting.

Authorities urged Scott Wiggers to evacuate, but he refused.

“I’m in the safest part in the subdivision. There’s no threat to my house whatsoever,” said Wiggers, a tour guide.

Wiggers said he wasn’t leaving his home on the outskirts of the evacuation zone because he worried that if he did, he wouldn’t be able to get back in. But he’s prepared in case the situation takes a turn.

“I am packed. My truck is loaded. I’m not a dumb-dumb. If I see a threat, I’m out of here,” he said.

Hawaii Gov. David Ige told evacuees he has called the White House and the Federal Emergency Management Authority to tell officials that he believes the state will need help to deal with the volcano on the Big Island.

Authorities are allowing some evacuees to return briefly each day to gather medicine, pets and other necessities.

Montoya, who moved to Hawaii to be with his family about six years ago, said he saw most of the United States as a truck driver for 25 years on the mainland. He prefers life on Mystic Forest Farm, in a purple octagonal house his family built nearly 20 years ago.

The farm is at the end of a long, single-lane gravel road, with large volcanic rocks scattered about and large pools of water to drive through.

Montoya is tending to the farm’s animals — sheep, chickens, rabbits and several cats and dogs — and watching over the property to prevent looting.

Officials warn that lava could flow downhill and burn areas that are not currently in danger, and toxic volcanic gas could kill people, especially the elderly and those with breathing problems.

Events remain unpredictable. On Sunday, the first day residents were allowed back in, a cellphone alert went out urging people to leave after a vent opened up and began spewing sulfur dioxide. Officials were worried that some residents could become trapped.

The fumes wafted down on the farm from the open fissures above.

“It was really cloudy with a lot of sulfur in the air,” Montoya said. “It hurt my throat. It was pretty miserable.”

Residents of Lanipuna Gardens, a subdivision directly to the east of Leilana Estates, still cannot return because of danger from volcanic gases.

Montoya’s 45-year-old daughter, Tesha “Mirah” Montoya, wasn”t especially worried about the gases. The tipping point for her to evacuate, she said, was the earthquakes that preceded the eruption.

“I felt like the whole side of our hill was going to explode,” she said after a magnitude-6.9 quake rocked her land. “My heart and soul”s there,” she said in a phone interview from a cabin on the north side of the Big Island, where the family had hunkered down. “I’m nothing without the land. It’s part of my being.”

The family’s property on Kilauea (pronounced kill-ah-WAY’-ah) has several buildings and cabins, gardens and animal coops. The land also has about 130 kinds of exotic fruit trees. There’s a pineapple patch and enough food stored away to last a long time, she said.

There are 12 lava-producing fissures in Leilani Estates, but the flow of lava is not constant. No lava was flowing as of late Monday, said Janet Snyder, a spokeswoman for Hawaii County.

A total of 35 structures, including 26 confirmed homes, have been destroyed. Aerial surveys cannot make out whether some of the structures are homes or some other building.

Edwin Montoya is happy staying on the farm, tending to animals and eating from the trees. He’s living the life he wants, just like many in this rural landscape in the shadow of one of the world’s most active volcanoes.

“It’s where I want to rest my bones,” Montoya said. “But nevertheless, I will survive. I’m sure I will survive.”

Uber, US Army To Test Quiet Aircraft Technology

Uber Technologies said Tuesday that it would work with the U.S. Army to advance research on a novel, quiet aircraft rotor technology that could be used in future flying cars, or military aircraft.

The alliance highlights stepped-up efforts by Uber and other companies to transform flying cars from a science fiction concept to real hardware for residents of mega-cities where driving is a time-consuming bore.

Uber and the Army’s Research, Development and Engineering command said in a statement that they expected to spend $1 million to develop and test prototypes for a rotor system that would be used on a vertical takeoff and landing vehicle.

The system would have two rotors, one stacked atop the other, moving in the same direction under the command of sophisticated software. This approach, which Uber and the Army said had not been deployed in a production aircraft, could lead to quieter operation than conventional stacked rotor systems.

“Achieving ultra-low noise is one of the critical obstacles” to deploying aerial taxis in urban areas, Rob McDonald, head of vehicle engineering for Uber Elevate, the company’s flying car operation, said in an interview.

The Army wants to develop a new generation of unmanned drones that do not need runways and are quieter than current drones, said Dr. Jaret Riddick, director of the U.S. Army Research Laboratory’s Vehicle Technology Directorate.

The Army is increasingly turning to partnerships with private companies to research advanced technology, Riddick said in an interview.

Uber is planning more alliances with government agencies as it aims to launch prototype airborne taxis by 2020, Mark Moore, Uber’s director of engineering and aircraft systems and a former NASA researcher, said in an interview.

Uber already has a partnership with NASA, the U.S. government space agency, to develop software for managing large numbers of aircraft over cities, Moore said.

Uber is one of several companies, including aircraft makers Boeing and Airbus SE and a venture backed by Alphabet co-founder Larry Page, that are investing in the concept of small, automated and electrified aircraft that could be used to ferry passengers or cargo across congested cities.

Uber said it would develop its low-noise rotor system in collaboration with Launchpoint Technologies Inc., a Goleta, California, engineering company focused on electric and hybrid aircraft technologies.

Uber will hold a conference on flying vehicles this week in Los Angeles.

‘Museum of Broken Relationships’ Comes to Kosovo

Dolls, a memory jar, a magnifying glass, a used condom — each is a memento of heartbreak contributed by an anonymous contributor to the Museum of Broken Relationships, an eccentric display in Kosovo.

The traveling exhibition — tied to a permanent tourist attraction in the Croatian capital, Zagreb, dedicated to treasuring and sharing heartbreak stories and symbolic possessions — opened a monthlong stint in Kosovo last week as part of Europe Week. 

“Its mission is to connect people in public spaces through the stories of love and loss,” a statement from the EU office in Kosovo said.

Curator Kushtrim Fetahu said organizers launched an open call for stories on Facebook and Instagram, and managed to collect 30 objects for the Kosovo exhibition.

They all aim at “storytelling, story sharing, to explain all the relationships, what happened not only between lovers but also between friends and families,” he said.

One contributor from the western Kosovo city of Prizren writes of a memory jar: “This jar holds the beautiful days and nights of our relationship and that doesn’t deserve to be thrown away and not to be remembered.”

The collection in Pristina includes items from the museum’s permanent collection in Zagreb, such as a positive pregnancy test from Leipzig, Germany, as well as the wedding dress of a Turkish woman who lost her husband-to-be the day they would have gotten married — in June 28, 2016, when a terrorist attack killed him at the Istanbul airport.

The museum won the EMYA Kenneth Hudson Award in 2010 for the most innovative and daring museum project in Europe.

The EU statement said that the Museum “encourages discussion and reflection not only on the fragility of human relationships but also on the social, cultural and political circumstances surrounding the stories being told.”

When the project wraps up in Kosovo, some of the stories will be sent to the permanent museum in Zagreb.

“In this way, stories from Kosovo will be a permanent part of an international museum,” the EU statement said.

Disney Seeks New Frontiers as More People Watch Video Online

Disney is seeking new frontiers.

The media company launched its $5-a-month sports streaming service, ESPN Plus, last month, and it signed a deal with Twitter this month to create Marvel, ABC and ESPN content on that service. Meanwhile, Disney is trying to buy much of 21st Century Fox, including the Fox television network and the X-Men movie franchise.

The moves come as Disney seeks ways to extend beyond the traditional cable-bundle format as more people watch TV online. Sports network ESPN was once a jewel in Disney’s crown but subscriptions have been falling as people drop cable services.

But the company has found strength elsewhere, notably its movie studio and theme parks.

Disney’s franchises such as Marvel’s Avengers and Star Wars have been raking in money. Avengers: Infinity War has grossed over $1 billion since it opened April 27.

In a statement, CEO Bob Iger said Disney was “very well-positioned for future growth” because of its ability to take advantage of such franchises across all businesses and “the unique value proposition” it’s creating with direct-to-consumer streaming services.

In Disney’s fiscal second quarter, net income rose 23 percent to $2.94 billion, or $1.95 per share, from $2.39 billion, or $1.50 per share a year ago. Excluding one-time items such as a benefit from the U.S. tax overhaul, net income totaled $1.84 per share.

The results surpassed Wall Street expectations. The average estimate of six analysts surveyed by Zacks Investment Research was for earnings of $1.68 per share.

Revenue rose 9 percent to $14.5 billion, from $13.3 billion a year ago. Four analysts surveyed by Zacks expected $14.2 billion.

Sports streaming

To prepare for the future, Disney launched a sports streaming service with video not available on the regular ESPN channels. This includes additional baseball and soccer games, and the entire 30 for 30 documentary series on demand.

The Walt Disney Co. is also working on an entertainment streaming service with classic and upcoming movies from the Disney studio, shows from Disney Channel, and the Star Wars, Marvel and Pixar movies. That service will launch in late 2019 and will include movies leaving Netflix, once its deal with Disney expires.

If the $52.4 billion Fox deal goes through, Disney could supplement the entertainment service with Fox properties — such as X-Men movies and National Geographic programming. Disney is still awaiting regulatory approval, and published reports say Comcast is mulling a counterbid.

J.P. Morgan analyst Alexia Quadrani expects the service to break even by 2021 with about 13 million subscribers. Until then, Quadrani said, Disney might lose some licensing fees and see spending increase to acquire content.

Morgan Stanley analyst Benjamin Swinburne said in a client note that the direct-to-consumer businesses like its streaming services could add $6.5 billion to revenue by 2020.