tv Bloomberg West Bloomberg January 29, 2014 1:00pm-2:01pm EST
♪ from pier three in san francisco, welcome to the early edition of "bloomberg west" where we cover the global media and biology companies shaping our world. our focus is on technology and the future of business. erisa meyer has not put questions about -- marissa mayer has not put questions about the future of yahoo! to rest. earnings have remained stagnant. the company spent more than one point $2 billion on more than two dozen acquisitions.
$109 million for just 14 months. they revamp everything from yahoo! mail to their suite of weather and finance apps. yahoo! shares are falling more than six percent. in a cornerbeen office. have we given her enough time? you cannot blame her after 24 months, a month, i'm not sure what the right answer is. despite the rise in the stock, i think that that is really about the success or the perceived success of ali baba. sales are down nearly two percent on a year-over-year basis but if you look back over the last few quarters, you see a very consistent falling of sales, of revenue.
in spite of spending over the course of the 18 months over a billion dollars in acquisition to try to buy traffic. in spite of buying all that traffic, revenues continue to fall. >> what about ads, she has revamped all of these products. why someone going to advertise as revenue rather than facebook? >> some of them were not that bad. some of the revenues are are falling. there are a number of ads, that pick up. that speaks of the quality of revenues. the number of ads is picking up. that means that they're not what you hoped they would. >> the yahoo! stock price has soared in part because of their .uge stake in ali baba how much of this is because of
marissa mayer. of what is going on with yahoo! over the course of the last year is really the success of the financial engineering principally brought on by dan loeb. the cfo is one of the best in the business. it has this pile of assets. they got together and said that we want you to parcel these out so shareholders will get value. some of the moves wrought on has happened and ali baba is the biggest piece. i don't think that they could have predicted that the market would go crazy for growth stocks in china and suspect that ali baba could have numbers that would be so big that it would flow to the whole company. that is one the side benefits they have got. you mentioned the hiring of one
single employee for over $100 million over the course of the year. you talk about these acquisitions that have failed to deliver revenue growth. some of the moves that marissa mayer has made have been very expensive. they have yet to show any results. >> what can she do about this hole in her see suite? it seems like she will be taking on a lot of responsibility. what does it mean when a ceo is personally doing what the coo should do. >> these jobs are different in every case in the way that those job responsibilities are delineated. there are so many people who used to work at yahoo!, myself included. i think a lot of people in silicon valley root for the company because they have some memories of the place and want to see it succeed. people talk about yahoo! as
though it is hewlett-packard, as though it is part of the ancient value. so many people have been in and out of the revolving doors that i think before that in santa clara that you have a lot of people rooting for the company and is trying to find a way. somebody will walk in eventually. you have to vote on 10 short years. >> it is funny and talking with new employees at yahoo!, old .mployees at yahoo! they say the energy is different. how does this matter? >> only matters of the numbers get better and thus far they have not gotten better. >> cory johnson watching yahoo!. we have some breaking news to tell you about now. the ceo of ericsson says he's
not going to take a job at microsoft. we have reported that he was on the short list. knee is officially said that he told the board of directors that he has no plans to step down following these reports. who is going to take this job, cory? let's take you on here. not a lot of people seem to want this job. a lot of people wanted the job and one thing we might expect is if a ceo announces he is not taking the job, it might be because he is not getting the job. see sometart to candidates in the running pulling themselves out. i suspect that there are a lot of people that would like to take this job. when we hear these names, you can see the kind of businesses that microsoft might be focusing on.
they are thinking maybe about telecom, mobile phones, and that being the future. tell whatat we can the board is thinking based on what they are thinking of. does anyone at microsoft that action must to have this job want to take the job? alan mulally says he is not taking the job. we don't know what is happening in the boardroom room, in these negotiations. the ceo search is taking longer than they said it would. i wanted to have someone in place by the end of last year. they have until june. >> what they said very topically as we are going to take a year at a certain point we are hearing privately that they thought they would be done by the end of the year and we find out later that the guy running the search said no, it is going to go on into the next year.
publicly, they have always said a year. privately they hinted at something else. we can assume anyone who is senior career has been gunning for bigger and bigger jobs. they imagine that there could be a ceo wants. overseeing the cloud business at microsoft than i think that that is an important person who is one of the most likely people to get the job. there are other names that we have not heard yet that are still under consideration. the top candidates? does it all go back to internal candidates? >> that is the most likely option because the culture of microsoft is one where there is so much history there of intra- division battles. people at the company fighting against others in the company.
it also has a lot of supersmart people. the company is trying to hire people who are smart and challenge each other. i think they are knowing who's who at that place would be a great advantage. >> we spoke to bill gates he was still chairman of the board. he is still in the board room. ballmer is in the board room as well. two people not want to do with that challenge? >> that is certainly an impediment. a lot of moves that they made as they have gone towards the transition has really tied the hands of the next person. they can stop doing the buyback and dividend. they tied the hands of the next ceo. everything is not in the table. that tells you that bill gates and steve ballmer are making long-term decisions about what microsoft is going to be.
new twist as legal issues still hot the currency. some figure heads were arrested and charged with money laundering. this chart says regulatory future is being challenged. can a virtual currency be regulated? patrick, can bitcoin be regulated? >> yes, it is. to some degree as a self- regulating software program. in addition, most of the current futured the near-term projected uses fall under very .trict and literary categories money transmission businesses, securities and commodities derivatives exchanges, this is a highly regulated environment. a, it is already in regulatory framework. >> what about government?
we notice happening in china and china has prohibited bitcoin from the major banks. jamie diamond recently said that people will eventually get upset with it is government. government, a huge amount of pressure on banks. reviews of that? in some ways, it is impossible to do that so it will eventually be made as a payment system to be held as the same standards and that will probably be the end of them. how do you respond to that? >> it shows he does not understand bitcoin and that is ok, a lot of people don't. mr.s an opportunity for diamond and his organization to learn more about the bitcoin protocol and how can be useful and fit into the current regulatory environment at a much lower fee structure and the credit card industry and traditional payment methods. it has some other advantages as well that we can discuss.
it is very consumer privacy enhancing. this concept that bitcoin is somehow anonymous is just false. it is a misunderstanding of the underlying technology. the regulatory environment we are in and the businesses that have been built up around the currency. >> what about these arrests? these kinds of people don't help your cause. to criminallys activity, money laundering, drug trafficking. , peoplee early days experiment with doing a lot of things and it is unfortunate what has happened. we should keep in mind that these are allegations. you are innocent until proven guilty. as's see how that unfolds that goes through its normal process. putting that aside, i would say
in the early days of bitcoin there was this thing called bitcoin magical thinking which is this concept that people have that somehow you could do things with bitcoin you cannot do with cash because bitcoin is on regulated or that the obligations did not apply. that was not true then, it is not true now, and it will not be true in the future. with a high profile takedowns, you would have to be a really dumb criminal to try to use bitcoin as a payment method. >> if bitcoin is regulated at some point, will it still be attractive? >> sure, i think it would be more attractive. the more we get regulatory 30 around this issue. i commend new york for having hearings to discuss this. this is an important step. understanding how the rules work in new york and in the federal level. taken aral level has
strong lead. understanding how those rules apply, how they apply to this new industry, how businesses can be built in a compliant way. that will cause consumer to trust bitcoin and the companies built around it. is chinag a deal shutting bitcoin out? >> i think it is a big deal for chinese consumers. it means they don't have access to the same kind of technology and innovation that we are seeing start to spring up here in the u.s., in the eu, and in other areas of the world. they will restrict their consumers and their people from having the liberty to innovate and participate in technology will suffer the economic consequences of that. >> the general counsel, thank you so much for having these -- for joining me. google last got more stylish. we will tell you about the design features coming up.
>> google is taking another step aimed at wider distribution of google glassed. offer prescription lenses and subsidize frames for google glass. they will launch the device for consumers by the end of the year. you have been wearing this for eight months. >> every day. >> all day? >> every day. the new traded for version. >> and you where regular glasses. >> it looks extra dorky on me because i have to have my prescription lenses on and then
i have to put the glass on top when i get my new pair, i have already ordered it. >> google is designing these glass frames in house. >> they are trying to get distribution from the stores. they have eyeglass distribution. >> they don't want to have to deal with the stores and have to give up another 30%. i think they want to distribution over the internet. >> it is crazy to think of google getting into fashion eyewear. >> this is the new growth area in the industry which is wearable. apple is working on a watch. we're going to see a lot of new wearables and fashion will be a
huge part of this. why did they hire the bur barry ceo? that the things that you wear on you has to be fashionable. >> and it has to be an expression of you. the frames cost $226, are people going to buy this? >> not at this price level. there are lots of nerds around who will buy it. to go mainstream, the price has to come down. to beme that it is going 3, 4. this comes down to the price levels. >> i know that you love him. you just read a posting, google glass is doomed. >> doomed in 2014. the expectations are out of whack. if this becomes an argument about the apple iwatch versus
google glass, google will lose big time because more people are willing to buy a watch. the apple iwatch will outsell it may be 10-1. >> what are the big problems? what are the big problems is facebook. >> this is such a revolutionary new product that it is a unfinished product. talking is still not accurate as typing. i want the photo to come to my phone where i can edit it. facebook and to twitter. >> privacy is still an issue. there is no light on their to tell you when you are doing something. >> there is a light that you will see when i take a picture.
>> but i don't know if it is on the whole time. i don't know how it works. >> those fears go away when more people get them and people can actually play with them and learn what the gestures are. it's pretty easy to show somebody how it works and how to tell. i am not worried about that. i think think those go away over time. it is a new scary controversy will product. it is even more controversial than the apple ii. woz's own bosses did not think they would sell. >> thank you for stopping by and sharing your glass with us. time for a look at what is moving on the hour. mark crumpton in new york. >> let's get you caught up on the markets. stocks continuing their decline. emerging market turmoil to
>> welcome back to the early edition of "bloomberg west." , for your bloomberg top headlines. you are looking at live pictures of the royal caribbean cruises ship carrying hundreds of sick passengers returning to port in new jersey. they are returning to new jersey after 600 passenger and crew got sick. another partrea, of the deep south is recovering from the snow and ice storm that caused major gridlock. many were stuck on buses.
blanket the of snow area. part of the national guard had to be called in. super bowl price of tickets is rising. the forecast is now calling for a clear day with temperatures around 38 degrees. when the denver broncos and seattle seahawks take the field to brave the temperatures, they will be doing so wearing nike. i'm not bitter at all that the 49ers will not be there. >> it is plenty of bitterness. , it isire sports world turning up in this town. this is included. they run the global creative
director. it gives you a sense of what is going on. i hear footsteps on the jet way behind me. i turned and there is bill walking up to me. he was a neighbor of mine. on my seat and right across from me, joe montana. neither one of those guys are involved specifically in the broadcast. joe told me, he's doing stuff with papa john's. nike is doing what. >> a very exciting time. this really launches the next platform. this combines the weather elements are the moments they will have on those conditions. this is what the playing
conditions will be. we have everything that gives the warmth without the oak, a full range of motion. that gives them the advantage. >> you service all of the programs. you have a special relationship with the broncos, even back to the redesign with them back in the 90's. >> thank out, you redesigned it. >> then we have had a great relationship with seattle and that being a redesign that we just completed. >> that is a reason that we are biased on that matter. talk to us about some of the product changes. innovationse main is, vapor carbon cleat. it gives the stiffness where they need for explicitness and for range of motion and lateral stability.
>> also because you like the word. >> it is light weight. one of the main pieces. >> carbon fiber is expensive material. when you ache about global sourcing, do you think about the unavailability? wesley leslie listen to the athletes. it for those athletes, it is no holds barred for what they need and giving that advantage. >> possibly my favorite book about this. companydescribes is a built around the culture, around an idea. it is carried around all of the employees. and this translated to the markets. better about here is a and cheaper product. foundatione way the of our company. we listened to the voice of the
athlete. that is how we innovate and move forward. , whate is my question this technology due to your brand? why talk about technology? you could argue about that they have always done that. analogy making nike? >> a a good brings new materials. it brings new ways of making products. >> by affiliating yourselves with the fuel band, for example, kind of a more old-style technology as well as a material science that you are on the cutting-edge of. what does that due to the way people perceive nike? >> we perceive them as a modern sports design company. i think that gives our athletes a competitive advantage for when they gear up with us. i think a proposal is to try new things, new ideas, and new ways of going to market.
>> is there a point at which the gear is so good that it helps to protect the players so much the injury that it leaves players plane so aggressively that they cause more injuries. >> there is a rise in head injuries in some ways. we don't create the helmets. we do the pharaoh and footwear above. we have problems with physiology that really installed. keep it more comfortable. >> what are you going to do on sunday? >> i am watching the game. >> who do you like? great relationship with the broncos. you are from the northwest. >> there is some association there. >> i think it will be an
exciting one. i'm going to watch it from my couch. >> thank you very much. .> thank you i will be watching from my couch. do not miss bloomberg tv later today. pimm fox will be sitting down with football legend dan reno ."ter on "taking stock sitting downill be later with dan marino. you can watch a streaming on your phone, tablets, and at bloomberg.com.
anniversary at the summit in san jose yesterday. lex i have been reflecting a lot on the first 10 years at facebook. one of the things i remember from really early on, it is one of my friends that i used to do most of my computer science problems stuff with and now he works at facebook and runs a bunch of our engineering team. government rafter release in the first version of facebook, we had this conversation where it is awesome that there is this utility and community at our school but clearly some day someone is going to build this for the world and he did not occurred to me that he could be us. >> this is a gathering of engineers from a number of companies to share ideas about server performance. it saved facebook over $1.2 billion in infrastructure costs. well, the form just reopened
after the million-dollar makeover from the madison square garden company. the goal is to lure the touring business from the downtown staples center. look at the new lightingnovative new and caught up with the executive chairman along the way. >> the form posted every big musical act you can think of. it is a battle for attention with his younger across town rival, the staples center. this play she's got a massive makeover. let's check it out. overhear you have some eagles equipment, the first performers. . >> the company has spent $100 million on renovations. >> it was arguably the most important music venue in the
world at one time. they really saw that the opportunity to return to its original splendor. >> we came in and rip everything out, took the seats out, basically out of the building. >> if there's one thing that makes this the premier concert venue, maybe not just in the u.s. but around the country? >> one thing, the sound. don henley says this is one of the best sounding buildings in the world. >> they put sound baffling everywhere. it was already a great sounding building. >> there are stylish hangout rooms, the games room. there is a fitness room. fear of i will test my heights. if you are a lighting expert,
somebody u.s. to get harnessed up here, you can just walk along. kind of star wars like. i noticed that you had your own mood lighting here. >> yes, we have over 600 led's, we call this our starry night. >> now, that is cool. >> very cool. well, jesse the body ventura has been a film actor, a wrestler, and the governor of minnesota. now, he is the host of his own show. we will have him right here.
take a look. you will not be watching me see that. "duck dynasty" you will not see me watching that. what the hell are you people watching? jesse ventura joins me now from mexico. jon erlichman joins me as well. you are literally shooting this from an undisclosed location, why is that? >> the show is just off the grid. i am off the grid somewhere in the world and we will change locations of the the drums don't find me. .drones won't find me
i had a view from the inside looking out. i have been talking for a long time, nobody seems to be looking. now, i'm taking the viewpoint from the outside looking out. >> i heard you talk about "duck dynasty", honey boo-boo. that was just about what people were paying attention to. i cover sports, i can talk about anything i want. i don't have anybody in the back room hovering above me telling me what topics i have to deal with. it is all jesse ventura, i am responsible for everything on the show. it is freedom you cannot believe. i just feel that being off the the u.s. much the state as east berlin.
i need to be radio free europe, this is internet free america. they are talking to the american people from outside the country, not in. >> this is a platform that larry king is also using. this is a business that is backed by carlos slim. how involved is he getting in this. what have you learned about him and what he thinks about the future of tv and broadcasting? him, i not even met just know him as the owner of the company. i don't anticipate meeting him soon because he would have to find me. we will be going from multiple locations. no one will ever know where the broadcasts are coming from. this is what i'm taking from the old wolfman jack. all of us knew that he was broadcasting from somewhere but we did not know where.
of whatid get an idea this platform would be like. i was on a book tour and larry was on my schedule and i had not paid attention. larry, what i'm doing. he said, i am on the internet now. this is where i need to be. we worked out the contract and i told them that i was leaving and going off the grid and they said, that will not be a problem. in fact, that will end up being the show. one reason i like being off the grid. >> where does the show follow on your list of priorities? people talk about you going back into politics, running for
president. -- are youme a you divide devoting? >> this is my main focus. might be this show that will lead me back to politics. when am i in the u.s., i have a very difficult time getting interviews. they try to marginalize you. if you are a threat to the democrats or republicans, you get marginalized. i don't stand for that, they can't control me now. anyone on the internet can receive my show on a daily basis tuesday through friday. so, it gives me the opportunity. show on then his internet is like doing a 12 minute wrestling interview. i was made for that. about his newra show. thank you so much for joining us today.
livelcome to the special coverage of the fed and its interest rate. we are just moments away from the last decision under ben bernanke. they expect him to announce plans to taper their bond buying program by $10 billion a month. peter cook is live at the fed and we will hear from him soon. by bloomberg's economic editor mike mckee, the ,redit suisse director of rates and olivia sterns. what to the markets want to hear from the fed considering all of
the volatility we have had? ? is want to hear that they are staying the course. the same time, they're going to knowledge what is going on in the emerging markets. we have to member that these swings in the risk markets tend to take place pretty regularly and the federal reserve is likely to look past that. if things get much worse, the fed might change their policy stance a little bit but i doubt they will do it today. >> michael mckee, what are you hearing? >> nobody expects them to cut back on tapering. inthis point, the question many peoples minds is what are are they going to say about the economy? what are they going to say about their forward guidance given that they set the threshold for unemployment is six and a half percent before they start considering interest-rate increases. do they want to adjust that guidance yet or will they wait
until janet yellen is firmly in control? >> the things we have to remember is that the federal reserve is moving away from unemployment. they're really moving towards inflation threshold. there is an implicit threshold. they say we don't want inflation to be too low so they will wait until they get inflation up a little bit before they think about hiking it and that is likely to come in the first half of this year. >> or minus about the markets were looking for the the last meeting. >> markets are often very jittery ahead of these meetings but it looks like economist think the fed will stick to the script. we are seeing jitters in the market. reverberationsre with what is happening in emerging market currencies. we are seeing treasury yields coming down. they are at their lowest level in two years. there has not been a good
reason yet at least on u.s. economic data as to why people are buying up u.s. treasuries except for this in the emerging markets. where we were on the s&p when we have the last fed meeting. we're down about 2%. that could be earnings, it could be a bit of a correction. hear from big companies including at&t, yahoo!, boeing. their forecast disappointing. they're looking more corporate related. the 10-year at december 18. i was trading and at about 2.89%. >> olivia sterns joining us from the newsroom. let's take a quick check of the markets before begin that decision. dow jones sliding about 129 points.
the s&p 500 down 6/10 of one percent. index isq composite down nearly three quarters of one percent. >> the taper continues. the fed is reducing its bond buying from the current $75 billion to 55 billion dollars a month at the final meeting of head chairman ben bernanke. the forward guidance remains the same. much of the language remains the same. there is some news comments with regard to the economy. perhaps the most important section within the statement itself. it says -- and it's a repeat of the last statement -- if income information broadly supports expectation of ongoing improvement in labor market and inflation moving back toward its longer run objective that the meeting will likely reduce the asset