tv Bloomberg West Bloomberg April 6, 2016 11:00pm-12:01am EDT
mark crumpton: 64% of dutch voters have rejected a eu-ukraineon easing association. 36% voted for the measure according to an exit poll. only that 29% of the electorate cast a ballot with a margin of error of three percentage points it was unclear the turnout surpassed the required 30% threshold that was needed for the result to be valid. former coexecutive don blankenship was sentenced today to a year in prison for his role in the deadliest u.s. mine disaster. he was ceo.
in of the mines exploded 2010. the blast killed 29 people. blankenship was convicted of conspiracy. turnout for tuesday's primary in the wisconsin presidential primary exceeded expectations. unofficially, turnout was nearly 47.4%. at that easily topped the 40 percent protected by a election officials. voters came out in the biggest numbers since at least 1972. the world health organization says diabetes is on the rise, excessive weight, obesity, aging, and population growth seeing a fourfold increase in worldwide cases over the last quarter-century. global news powered by our 2400 -- journalists around the world. ♪
emily: this is bloomberg west. what is so valuable about youth content and what is verizon's broader plan? we will bring you the details. what will the world of app analytics hold? over 40 tangled web of overseas subsidiaries. just bring you up today on a developing story. jamie dimon out with his annual letter to shareholders saying the potential outcomes are large and potentially unknown. referring to the possibility of the you can withdrawing from the european union. he says this looming uncertainty could hurt british and eu economies and jpmorgan could lose millions of dollars in brazil due to extreme stress.
we will continue to review the headlines as a headline that they come. other news we are watching. they plan to finance the largest tech acquisition. our editor at large has been covering the story. headlines and just rolling in. what is the latest? about a week ago, they announced they are going to sell their i.t. services business, which they acquired for $4 billion -- $3 billion. three being less than 84. they are announcing they are -- a to sell documented company which allow for electronic verification of documents. $1.7 billion acquisition by emc. news that they are looking at selling some other assets. a sonic wall and >>. other companies acquired over
time there. it shows us that dell is looking to look forway fashion so that they can pick up the debt they have been using -- they had to apply to acquire in emc. a very expensive acquisition for dell. other business can actually pay for that and afford to pay down the stat. --this debt. they'll must've been in better than they were showing in the public results because otherwise how could they pay for these things? they are shedding units left and right for roughly billions of dollars, that certainly even out a loss of a billion dollars less for those i.t. services business. we will see what they get. given i'll mess -- keep an i on this story. looking to raise cash to pay down debt. much for theyou so rundown. .nto another deal verizon making a play for millennials.
streaming into online video. the nation's largest terrier has a 24.5 state in awesomeness tv from dreamworks. you will remember when dreamworks purchased the youth-oriented media company for cash. disney purchased makers studio in a similar move towards youth-oriented content. verizon's new state values this at millions of dollars. a potential doubling of revenue through the deal. i want to bring in the founder himself, brandtv robins, joining me now from l.a.. what about that ipo? are a littlek we ways away from that. i still look at this as a baby and i praise with a long way to grow. maybe, never say never. emily: you're going to be making premium, hbo caliber, short form
content. explain what kind of ideas you have been kicking around, what kind of talent you have been speaking to. in: -- br us, -- right started with public access programming, reruns of sitcoms and lots of episodes of star trek, each one of those brands defines themselves with a premium show, like madmen on amc. if you compare that to the digital video short form revolution, and started out with you gc content and the creators on youtube making their own more premiums shows, and the companies like ours came along and then started making restricted premium content. we believe the next evolution of short form video is superhigh quality scripted shows like you would find on a premium subscription service like hbo or netflix.
that is the kind of content we will be making, whether that is highly serialized dramas were scripted comedies with big talent behind and in front of a camera. emily: there is competition from youtube, spotify, what makes you think this service is going to be different from everything else out there. why will this succeed? everybodyon't think is investing the kind of dollars and programming like we are about to do. and we have sort of proven ourselves already in short form premium content, and i think that is why verizon is very interested in making this investment, because the content that we have made so far has really performed exceedingly well. to quote them, "beyond their educations." emily: you started this company focused on jens the --
generations z. brian: we are so very interested in generation z. this particular offering is to really capture the consumers that are really massively consuming video on their mobile mass and really trying to reach an audience that is underserved. content.tons of if you have an hour, you have a lot to watch. if you're eight minutes, 10 minutes, no one is really making this kind of content today, and we think that is the white space and that is where the opportunity is. emily: you have got three owners out. dreamworks, hearst, and verizon. does that make things a little con -- complicated for you? what is the end goal? brian: i have to return a lot of
phone calls. it is pretty special for us. when i started company four years ago, 40 percent of our views were on mobile. today, more than 80% of our reviews are a mobile devices. that is only going to continue to accelerate. to have verizon, the biggest mobile carrier in the world, as my partner, and to have that kind of distribution and reach -- i can tell you how excited i am about the possibilities. and all, throw in aol of those eyeballs and the text that comes with it. it is kind of a really fun playground for us. emily: all right, you enjoy those phone calls. brian robbins. we will keep our i on you guys. on you guys. now i want to bring one of the cofounding editors of wired magazine who has been covering technology for many years. you have news of europe which we are going to talk about later in the show. what do you make of this deal?
you have got dreamworks, verizon, and hearst all dipping their toe in here at the same time. we have got facebook life -- facebook is paying companies like the new york times and but seed to do by the video on facebook. those models always slip. that is not going to last. you want to count on that for a long time. >> what is really interesting is i think brian is right. media companies have not caught up with the habits, particularly of younger people. if you want anything immediately states, you absolutely have to think about one thing, which is video tech nvidia -- on with facebook and captions. it is not how traditional entertainment provider think about what they make. i think this is a smart move by verizon, getting into a market they probably did not have -- boarded aol have a lot of native chops. emily: what do you make of facebook going beyond my when
twitter seems to be the perfect venue for live. in fact, they just all the rights stream nfl games life. >> facebook is a large they can afford to try things. for facebook, they have tried a lot of things that have not worked out. they try to can be snapchat. that did not work out. if they set their teeth and go at it, i think they would be quite concerned if i were twitter. emily: facebook and google still dominate. were it easier growth of online video? the future growth of online video? facebook wins. let us be clear about that. facebook is a place everyone -- the way wes think about google as the first version on the web. we think of facebook at the dissertation for media. video facebook wins. i think who loses are probably
authorities may start to worry. the founder is with me in the studio. bloomberg news reporter who wrote this story. talk to us about how big this problem is with respect to airbnb in particular. david: since they have not yet become profitable, it hasn't been a problem. but airbnb say they expect to turn their first profit this year. once they get there profits, airbnb, all the sharing economy companies will have the opportunity to use the tax avoidance techniques that have been used by tech companies and pharma companies. but so far they have not been able to use it and what changes is with us norms, they are able to make the same kinds of savings and lower their rates to a level that has people in the treasury department concerned. emily: we did get a statement from airbnb.
they did not talk about tax strategy, but they said, we pay all of the tax that is due and we make long-term business decisions and act in the best interest of our community. john isn't this the same thing , google and apple and other corporations have been doing for years? john: the interesting thing is they're forcing a new conversation about what kind of company do we want to have in our society. what is the role of the company as a citizen? it raises that to another level, which is if they are going to be extracting service revenue and putting it under a shelf somewhere, what about our schools? what about our roads? what about basic r&d that created the internet in the first place? this will end up in legislation. emily: what company is going to
say i will take it for the team? john: none of them. in every company in the world that has a certain set of profits that employ a lot of people to keep as much of it as they properly -- as they possibly can, that's what we are having at the presidential race level. what is the role of a company in our society today? emily: you report the sharing economy could account for hundreds of millions of dollars by 2025. what's the u.s. government doing about it? david: they are still getting there hands around it. the irs is not quantified it. the treasury department would restrict the use of hybrid structures that would allow companies to lower tax rates to zero, but there's also something about the deferral of offshore that they would restrict but it is all deadlocked in congress. there have been proposals that have so far gone nowhere. it may be that there has to be a bigger conversation about tax reform to see if there's a way to handle lists and make it
being a revenue drain on the treasury. emily: first the panama papers and now this. john: if i were at airbnb right now, i would say, what terrible timing because the panel papers -- panama papers just came out. this is exactly the incentive system we set up in our economy and we need to think about whether or not that is the right incentive. emily: john is with me for the hour. david go2net ski, our bloomberg news reporter, thank you so much for later, we will dig into the multimillion dollar tax credit market that hollywood production companies and many more are taking advantage of. still ahead, peering into the future of energy. we take all look at whether there's any stopping the spread of solar. ♪
emily: time for our latest installment in a week long dive into renewable energy. we look at wind and battery and now we look at solar. solar has been having trouble despite a collapse in oil. the sectors getting twice as much global funding is fossil fuels. research from bloomberg new energy finance shows. experts believe solar energy will come to dominate because it is a technology, not a fuel that will likely get cheaper and more efficient as time goes on. i began by asking it is the , presence of solar inevitable and how soon can we reach that point? take a listen. guest: we are only at 1% of u.s. households penetrated today. but the growth rate we have achieved from zero to 100,000 customers starts to compound and i think you will you happen faster than people expect. emily: how much faster?
guests: i can imagine that solar is about 20% plus within three to five years. emily: what are you doing to reduce installation cost? will solar ever be competitive with utilities without tax , other innttax credits? guest: solar is competitive today. a lot of people don't know that all of energy is subsidized. the global subsidies for fossil fuels are $5 trillion. fossil fuels in the u.s. receive eight times the subsidies that renewables did in the u.s. what we are saying is let's have an even playing field. today already even with all the , subsidies fossil fuels receive, we are 20% cheaper and our costs are going down. the power we are competing with is going up at the same time. a lot of people will say oil and natural gas are so cheap. what drives power prices is the
investment in transmission and distribution lines. which are aging in this country and introducing a ton of risk. that's why we have these brownouts and blackouts. what happens is is that utilities have to modernize the grid, prices are going up. emily: the end of net metering could be a huge blow for the entire sector. how do you expect these to play out? lynn: what is happening today is consumers and innovation are driving change despite what is trying to be done on the regulatory side. what we have seen happen is when we look at the facts, rooftop solar strengthens the grid because it is produced on-site. you don't have to invest in as many transmission distribution line subsystems. those are the things utilities make money off of. so they don't like it. what these are coming down to is competition. what we are realizing is that when consumers can choose
cleaner, cheaper energy, they are going to drive the change. emily: the battles are far from over on the regulatory side. what are the next flashpoint s in this debate? lynn: we had big wins this year set us up for long-term success. the federal government gave us a five-year runway. second, california established their long-term support this market. that is a huge and important market and to places where we two places where we are showing we're going to leave to switch electricity from dirty fossil to renewables. what i see continuing to happen is utilities will be threatened and they will try to protect monopolies. but when you look at the fact, we will see rooftop solar is a benefit to society, we will win nine out of 10 times. there will be a few extreme examples such as what happened in nevada, but a similar thing happened with gay marriage in indiana.
emily: solar stocks are down across the board. are you facing slower growth, to too? lynn: the fundamentals have never been that are in this industry. consumer demand is strong and we are saving customers 20% on electricity. we're continuing to adopt it. secondly, you are seeing real entry barriers. it's hard to do, so there's short term noise as there are companies entering the market and some of them have had trouble raising capital. but the quality companies with quality assets have not. he just completed our prospects for the future and just closed very attractive financing. a lot of people think can continue to raise capital. we just did last month. we were able to raise financing through the credit cycle in 2008. the reason is these are very
high quality assets. these are homeowners who have very high fica scores. they pay their bills and these systems perform. we've been operating for eight years and we have the track record. when i look at a market like i'm very encouraged because i think it is a short-term entry barrier. emily: tune in tomorrow for the final installment of our series. we will hear from a startup seeking to redesign the power station and a u.k. company building the world first title -- tidal power system. another story we are watching. nokia will cut between 10000 and 15,000 jobs as part of a plan to save a billion dollars a year. officials have been racing since -- bracing for job cuts since the merger with out to tell lucent. the job cuts are aimed at help nokia cope with a challenging business environment. and intends competition.
mark: they will act appropriately if need be. the currency strengthening. high.an 18 month a one-sided move. the dollar fell against the yen. further rate increases this year. makers smartphone something the most in nine months. at the company resumed trade after becoming the target of a u.s. investigation into allegations that it writes that sanctions against iran, saying the impact is uncertain, and a good-faith civil and criminal penalties. despite preliminary estimates.
5.7 billion dollars. it's something that estimated third-quarter sales against the elegy x -- galaxy s7 -- caps on i had started against --samsung i had started against rival apple. our by over 2200 journalists. let us get the latest from the markets. ack after that very choppy morning. >> it was looking so good. still in the red, down by 2/10 of 1%. strong yen starting to once again recounted. if the its longest winning streak. yen on its longest winning streak.
really is a tale of two different parts of sentiments in asia today because we have seen that weakness in shanghai way .nto the market in taiwan korea turning negative. if you look at southeast asia, australia, and new zealand, it is looking a lot brighter. thatis on the back of that we had coming through from the fed which gave boosts to crude oil prices. into in the region and health-care stocks looking very solid as well, up by a 10th of 1%. this is the year-to-date chart for the ta. it has had a shocker of a year. seen since we have march 7. today, resuming trade and plunging quite significantly. one third significantly up by 50%. a check of that japanese yen. really continuing to strengthen against that dollar, holding at
109 .18. up 9% against the dollar. it is up by half of 1% today. this is a look at asian markets is mine. -- this morning. emily: surveymonkey is branching out beyond its namesake business of online surveys and getting into the business of at analytics. the ceo says it will eventually generate a double-digit percentage of the companies overall revenue. i asked zander lurie why he's departing from the core business. this was zander lurie : an acquisition we made last summer and today, we are launching surveymonkey intelligence which is an apt provider for investors to learn more about their products and
how they fare against their competitors. this is when the key tools in --one of the key tools in our portfolio. emily: you can figure out is over versus lyft -- how accurate is the data? how are you getting it? how do the companies feel about it? : it is very accurate and it depends how you are performing. we are able through the size of the panel and the answering capabilities to project important characteristics like revenue not only for your product, but this lets you measure the success of your product against your competitors. the feature functionality which drives certain growth, you can start to analyze and survey your users, find out what is working and not and make changes on the fly. emily: you guys have been doing a lot of polling during the election and it has been held up as one of the more accurate places to pull.
to poll.- places what are the most surprising trends you have seen? zander lurie: when i was growing up, your parents would get calls during dinner and it was an office -- an awful process. this has changed the landscape of how we are pulling for elections. we are able with the size and scale of our platforms, we get 3 million responses a day and we are the largest surveyor in the world. we can ask what's going on with the elections and what we see is that the data is changing rapidly. trump has a significant lead and his campaign has been handicapped a bit by his crazy statements. emily: so is the core business still growing and how do you see that business being complemented by the new business and how does that add up like that?
zander lurie we are laser : focused on expanding into better mobile products and expanding internationally. there's a lot of functionality and new dynamic benchmarks we are injecting to the product to help grow every day. thousands of people sign up for surveymonkey accounts. we are excited to announce new initiatives like surveymonkey intelligence and other products around that core survey. helping companies analyze mobile data and deploy solutions to generate new customers, we continue to see adjacent markets but we want to make sure we are focused on staying around the feedback process. emily: you are taking the place of surveymonkey ceo dave goldberg. it has been a hard year for you guys. how are you planning to carry on his legacy and make your and -- your own stamp on the company? zander lurie: surveymonkey is an
amazing company. when dave goldberg and spectrum and bought the company, he brought in so much talent to help surveymonkey grow. his stamp is all over the company. his integrity, his empathy his , love for people and data and helping people make great decisions stands for the values we own and live by today. i would say there's a strong buy-in to help grow the legacy. we wear our t-shirts to help make him proud. in 2015, we had a challenging year and his death was a traumatic moment for all his friends and the people who loved working for him. but he would not want us to mow -- mope around the office and he would be dismayed if we did not carry on his legacy to build the best is this we can and we are -- the best business we can and
we are excited about the health of the brand of the volume of customers we work with every day and the nature of what we are building, moving into adjacent markets. emily: he was a dear friend of our show and talked about an ipo publicly. what are your plans for an exit? you have raised $7 billion at a $2 billion valuation. what is next? zander lurie: the companies going to generate more profits this year than we have at any time in history. these are rocky times and the -- in the capital markets. we don't spend a lot of time thinking about valuations or unicorns internally. we are laser focused on delivering for our customers. if we do that i'm confident we , are going to build a business that is durable and can grow for many years to come. i think we are tracking towards an ipo when you look at our financial profile. we have the kind of scale and profitability to go public and we want to do that on our timeframe with the broadest, strongest business possible. emily: you were on the board
billgh the situation with and dave passing. what happened with bill, what went wrong there? zander lurie: after dave passed away, the board committed to a thoughtful process to put the best person in that job we thought we could do. we did an internal and a struggle process. bill was someone that we knew for a long time. we had the opportunity to put him in the job and he joined in august. he let a pretty broad strategic assessment. he charted a path in one direction and the board and investors believe there are viable options. when you have a company growing like ours that is profitable like ours, your cup overflows with with opportunities and it's about taking sure you are aligned on the initiatives you think our best for the company. bill and the large investors had a different view of where we were going, so he opted out. i continue to count on his health. he's been a great advisor, but i took over in january.
i think the company has ralld around me and others to make sure we are driving towards that success. emily: your cto is beloved at the company and another back bone. she is leaving this week. how do you fill her shoes and maintain morale at the company? zander lurie: companies are durable and evolving and letting great people go on to do new things. she's excited about new startup ideas. i'm sure we will support for many years to come. emily: you did recently lay off about her teen percent of the workforce. guest: we are past the layoffs for sure. we venture we did this once and done. we were over extended into a sales assistant part of our business that was not very productive as the rest of surveymonkey. i read bloomberg's book from 25 years ago recently. he some of the many of us look
up to. just making sure you are investing in the businesses you are in the best position to succeed in. for us, those are technology-based, software-based solutions and services to help customers aggregate feedback. we just got over a sales assistant area that was not as productive. emily: turning to the broader markets, u.s. stocks rallying in the wednesday trade. ramy inocencio joins us with the takeaway intact. -- in tech. ramy: the big takeaways ending in session highs on wednesday. after seeing pops in health care and energy stocks. the nasdaq was up by 1.6%. i don't want to bury the lead here but the nasdaq actually hit its 2016 high, erasing all the losses we saw in the route that -- over the last few months in the route that we all know so well. part of this is biotech stocks.
you can see that it was on tear throughout the trading session, it was up by 6% going gangbusters. that's the biggest jump since the summer of 2011. let's get a little technical and hop into my bloomberg terminal. i want to show you where it went in terms of the 50 day moving average. that is the pink line here. we crossed the 50 day moving average and we are approaching the 100 day moving average in the green. this is now at its highest since january 22. erasing most of its losses for this year. specific stocks in biotech, as well as biogenic all up. by more than 5%. why are biotech stocks rallying? basically because of what is not happening with pfizer and allergan.
that merger now dead because of new in version roles coming up from the department of treasury. that means there's cash on the table for other perspective mergers. i will send it back to you but a big day on the nasdaq. for every one stock down, to -- two stocks are up. emily: coming up, just in time for tax income a multibillion -- tax season, a multibillion dollar market place to buy tax credits. we will bring you the details. ♪
in funding. the new influx of money will be used to pay down debt coming due. sprint has a total of $35 billion in debt. time to pay the u.s. taxman is just around the corner and a new multibillion marketplaces --marketplace is allowing investors to get in on the action with major hollywood studios. several studios are looking to sell and trade their unused state tax credits. the marketplace is estimated to be worth $100 billion had online incentive exchange launched the first system for the sector helping companies sell tax credit so buyers could use them to reduce the taxes that they go. owe.y yes, this is possible. i have to start here -- we were talking about airbnb, tax havens and loopholes. this all sounds very fishy but apparently it is legal. can you ? --can you explain?
>> tax incentives are used to incense specific activities. it's pretty straightforward and simple. if the state wants to produce jobs or create particular act industry,hat specific in the legislature in that state, it reduces a tax credit and companies are drawn to investing in that state to benefit from that tax credit. the movie industry is one of many. emily: why the movie industry and production companies in particular? guest: i'm not a politician but it brings in a lot of profiles and a lot of jobs into a local economy. emily: should other companies people to use other companies tax credits? john: it sounds strange but it is not unusual in point of fact. particularly in financial transactions. i'm curious what kinds of tax credits are not legally tradable? guest: most of the tax credits are not tradable. most of the tax credits are
either rebates or you have to use them or lose them. in order to create liquidity to draw in movie studios where they might not have tax liability in a jurisdiction, they need to be made transferable and those transferable tax credit to be monetized by those companies. currently, there's no efficient way to do that. emily: production companies? who else is taking advantage? guest: real estate companies, general companies by way of jobs programs, renewable energy companies. emily: louisiana made an interesting change requiring all tax credits that are being transferred to be registered with the state. is that going to hinder the business? guest: no. all tax credits are registered with the state. it is the state that produces the tax credit. the state does not have the technology to manage that effectively. those of the kinds of solutions that we are bringing to bear
with the ois. emily: does this fit into a new code future? john: i think many market like that would be created online. it strikes me that this is an innovation. i'm curious of individuals can take advantage or if it's only corporations? guest: absolutely. to date, it has been predominantly the domain of corporations because they know about it and they are in the mix. they are able to marshal the resources to interface with the community. with the ois we are , democratizing that access to individuals, so individuals who pay taxes are capable of buying tax credits. emily: how much did it cost? guest: they usually trade at a discount to face value. you might pay $.90 for $100 worth of tax credits. $.85 for $100 worth of tax credits. the irr's are a spectacular when you only have to put up the money for a few months. emily: interesting.
emily: my guest host has been -- spent the better part of three decades right about, investing in and using technology. but now he says the tech story is over. he says it time to move on to to the next big thing that will shape our future, just that technology has the past 30 years. newco has just launched a new media property in partnership with medium in order to follow the next big story. john the tech story is over? , what am i doing? what do you mean by that? john: obviously i've learned all all about click bait headlines.
for 30 years, i did follow the tech story because i thought it was not being well covered, i thought it was not being given its full due. the story of tech has changed our entire society. however, it's no longer the next story over the horizon. the one that 80 changing everything. i'm interested in that story -- what's the equivalent of the story when we launched wired magazine? the tech story is so mainstream , so incumbent that i'm , interested in what the next story might be. emily: what about apple and the government struggling to figure out how to deal with new technologies? john: but that didn't take 10 months or 10 years to figure out, it took 10 days and it went away. they figured it out. emily: for now. what if apple creates a truly on hackable -- truly un
phone? john: technology is a core force of any story you might tell. it is in the oxygen of our ecosystem. therefore i'm interested in what the new reality might be that's changing the ecosystem. emily: what's the next big story? john: the reinvention of capitalism itself. every story you tell ladders up to this idea. you talk about solar and tax evasion these are all going , to one large story which is the form of capitalism, the engine, the muscular american capitalism we have lived with for the last 70 or so years is faltering. it is not sustainable and i don't only mean that in a green way. it's not giving us a society that is increasing returns and we want that kind of society for our children and grandchildren. and will it get to it if we reinvent business? emily: you just launched a new media property that is entirely
on medium to capitalize on this. what are you going to be doing there? john: medium is a very interesting place to launch because it's a happy medium between the wild west and the open web, which is right with fraud -- rife with fraud. it's a very large platform which was not for publishing. it has a social network underneath it and allows us to focus on what we want to do, which is to make out the story. -- make it great content about this story. emily: wired meets the economist? explain. john: the approach "wired" takes which is to do longform journalism, we are very interested in that in the cogent analysis and focus on a week the cadence, we will release stories on a weekly cadence. emily: you have the founder of twitter commenting on your piece saying your magazine is now irrelevant.
do you agree? john: i was pleased he commented on it. he told me that "wired" rot him -- brought him out of nebraska and into silicon valley, so i don't want to say it is over. i'm still very proud to be associated with the. -- with it. emily: thank you so much for joining us. it has been great to have you for the hour. it's time to find out who's having the best day ever. today's big winner is the chinese dating app maker, momo. shot up 30% after it was announced alibaba joined a group seeking to buy out the company. it's the largest gain since 2014 and the stock price has more than doubled since a low in february. for a special line of, dropbox cto, nyc cofounder