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tv   Bloomberg West  Bloomberg  April 14, 2016 6:00pm-7:01pm EDT

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magnitude earthquake. the earthquake, which collapsed houses and started fires, was centered 74 miles northeast of japan's only operating nuclear plant. the u.s. will station warplanes in the philippines after ships began conducting joint patrols in the south china sea last month. over and claim sovereignty all of the south china sea islands and adjacent waters. republican party officials are warned not to change the rules to allow someone other than donald trump or senator cruz to win the nomination. told c-span that primary results show republican voters want and antiestablishment candidate. a debate between hillary clinton and bernie sanders days before the new york primary. mrs. clinton trying to snap a seven date losing streak.
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-- seven state losing streak. bernie sanders needs to make up ground for delegates. global news, 24-hours a day, powered by our 2400 journalists, in 150 news bureaus around the world. "bloomberg west" is next. ♪ emily: this is "bloomberg west." forng up, the stage is set another high-profile showdown between the tech industry and the government. microsoft is in the spotlight, a law that stops the company from telling customers when the government wants to access their data. elondo you spot the next musk?
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an entrepreneur capable of starting several companies? looking for those people in china. redstone will not be testifying in a case over his competency. all of bring you up to the twists and turns in the high-stakes saga. microsoft sets the stage for high-profile confrontation between the government and silicon valley over consumer privacy. a lawsuit in seattle was filed against the justice department attempting to change a law that bars tech companies from telling consumers when the government asks for their data. this fight is not over a single request, it is over the legality of a mountain of requests piling up that so much customer data is stored in the cloud. 5006soft has received hundred 24 demands for customer information in the past 18 months. half of them came with mandates
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that today not tell the affected customers. 68% came with unlimited gag orders, meaning they could not tell the customers ever. brad smith explained in a blog post why the company is taking action now. he wrote that based on the many secrecy orders we have received, we question if they are grounded secrecy.that demand it appears the issue of secrecy orders has become too routine. joining us now is matt larson. and a civil liberties attorney with the electronic frontier organization. how is the legal foundation different than what happened with the fbi and apple? >> this is about requests for e-mail. for thousands and thousands of e-mail accounts or other data, as opposed to one phone in the apple case. it is a different law, different
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constitutional rights. microsoft says it has a first amendment right to tell its customers bought requests for their information. that is a basic right to know that the government is investigating you. and basic right that microsoft ties to tell you. ,mily: they talk about this law made into law in 1986 before the world wide web, decades before anything was stored on the cloud. governmentatt, the is still looking for physical files. how are electronic files different? just because they are stored in a different format, shouldn't the government be able to search and then? -- search them? matt: that is what microsoft is raising. what is the difference between electronic files and paper
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files? how they are kept and providing notice to the parties that own the files might tamper with the investigation if there's a high priority and likelihood of them being aware the government is pursuing information via warrant? thatsoft is highlighting there is a disparity between electronic and physical, and congress needs to revisit how the warrants are executed. emily: we talk about apple in respect to this argument. microsoft backed apple. what is microsoft's track record with these issues? have done this before, particularly since snowden. a number of companies have done a lot more to raise this issue and notify customers about encroachments on their privacy. they sued the justice department to report requests like these,
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secret requests, and a national security context and pushing back national security letters. emily: we know the government dropped their case against apple in san bernardino, but there are other iphones in other parts of the country in question. what is microsoft doing in filing this lawsuit now? they will hit 20 government is down, essentially? that is an interesting point. we saw the tech community rallied around apple. five this he questions are at the forefront of what the tech immunity is concerned about. microsoft has taken advantage. there is a bill going through congress that is looking to amend the 1986 law under which the government is seeking microsoft's assistance and the gag orders.
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it lines up nicely with that bill coming out of the house judiciary committee. it is microsoft both complementing its lobbying efforts with litigation and capitalizing on these issues enough the forefront. apple set the tone for these investigations. i think the government was surprised at how much support they had in the iphone cases. we seeing microsoft giving it a go with their argument. emily: loretta lynch was named in the lawsuit a couple of -fbihs ago about the apple situation and the issues at play. listen to what she had to say. we in many cases at the doj see electronic evidence becoming paramount. we report who gets files, papers, boxes of documents, but electronic evidence is what we are seeing with every case.
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emily: the government says they need this information. another argument is that if you tell customers that the government is asking for their data they could hamper or delete it. perhaps it is easier to get rid of the electronic information than physical information? two things. there is no reason why you should be different than the physical context. just because you store the nation in the cloud rather than a filing cabinet, the basic principle shouldn't change. if you have a right to know if the government comes after your files in a filing cabinet, you have a right to know in the cloud. no one is saying there is no case where the government should be barred from knowing. there should be instances where it could harm another person or destroy evidence, that is why we have laws that allow them to get these evidences. .hey are doing it as routine
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you might not even find out when the investigation closes or they drop the investigation. the use are orders where the customer is never notified. that is unusual. emily: matt larson, andrew crocker, thank you. we will follow these cases across the country. we are watching the european its antitrustting probe of the google android operating system. according to people familiar matter, they have given 24 hours to remove business secrets. a sign that regulators may send out a formal complaint. google has been one of the most high-profile targets. the tax arraignments are also under review by the eu. a secretnstructing team to explore changes to the
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app store, including a strategy for charging developers to have their apps prominently displayed. apple is considering a google-like model where companies would pay to have their apps shown at the top of results,h giving apple a new way to make money. searching for the new elon musk or jack dorsey in china. ♪
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emily: rockets internet falling the most in more than two months in frankfurt after reporting a loss of $222 million last year. companies continue increasing sales, but operating losses are widening. several, including hello rash
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and an e-commerce site that you're an investment from alibaba. pressure to show investments are paying off after showing little progress. ggv capital investing in china and the united states. alligator in $250 million for early-stage startups in china. they are seeing more opportunities for our turnovers in china for those on their second or third start up, common in the united states with andepreneurs like elon musk jack dorsey. you're busy with companies like alibaba and airbnb. how do you intend to find the jack dorsey or elon musk of china? >> we are excited about our new
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funds. we're focused on global entrepreneurs. we love folks that build global companies. we want to invest early across sectors of focus, like consumer and online mobile services. like e-commerce. connective devices and robotics. we looking for companies in those sectors. in china, we are seeing entrepreneurs coming around for their second or third stint, or folks with experience and great internet companies like alibaba. there is a richer ecosystem of entrepreneurs in china for us to go back. columnistsof our wrote an article saying that everyone knows that asia's startup bubble has to pop. what are you seeing on the ground? >> we are focused on the venture capital ecosystem, the start of ecosystem, in china and the
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u.s.. what matters is the rate of innovation and the opportunity for companies to build businesses that can grow fast. in china, we see that continuing at an incredible pace. looking at patent applications, china leads in patent applications. there are more patents filed in china than the u.s. and japan combined. or phd's graduating in china than any other nation. of entre nous or is doing interesting things in china continues to grow. doingentrepreneurs interesting things in china continues to grow. halvesstartups have been down to $6.5 billion. does that concern you? look ordered a quarter, you will see plenty of variation in the amount of deals
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seeing done. china is no different. like ggv, other funds have raised cap role in china -- raise capital in china. you have a large pool of entrepreneurs looking to do interesting things. when you marry availability with entrepreneurs come you will see a healthy rate of growth in china from early-stage into later stage. it does not worry us. we are in china for the long haul. we are ready to invest and eager to see what is out there. emily: we are seeing venture capital firms like yourselves raising billions of dollars plus funds, even though we are supposedly heading into a downturn and companies are having trouble raising money. to checkey talked price and said the kaufmann fund said that billion-dollar funds suck, then everyone went out and
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raised billion-dollar funds. the kauffman foundation says venture capital is a not good place for institutions to invest, especially in bigger funds. what is your response? >> we agree with bill. large funds do not perform well. if you break down the funds that 4,raise, ggv6 looks like 3, and 5. we will continue to invest in a deals with balance and larger opportunities like airbnb and slack. companies that are strategic to us. in addition to that fund, we have raised $250 million in a separate vehicle for seed investing. we break our funds into more manageable fun, in line with what bill suggests makes the
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most sense. emily: startups are delaying going public longer and longer. enter capitalists are not seeing exits. even though investments are not being made and funds are still being raised, companies are not going public. who does this come back to bite? the lp is? the ggvs? to answer.fficult at the end of the day, we have to be focused on our markets. looking for entrepreneurs who want to be global. focus on our funds, which we have broken into smaller chunks. we think that we will have the opportunity to invest successfully. emily: we will be talking about lyft and uber. you are a dd investor. uber vs. lyft?
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market is aharing marketplace business. liquidity matters. those businesses tend to be dominated by the leader in the market. in the u.s., uber is the leader. ist it does well, but it number two. in china, dd is the dominant player. uber has a dominant business, but they are number two. emily: you see a winner take most market in ridesharing? >> and marketplaces, use the winner take most markets. that is why we are excited to be a market leader in china. grabtaxi in also in southeast asia.
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being a leader in those businesses is important. that is what we focus on in marketplace models. emily: the managing partner at ggv. thank you for joining us. >> thanks, emily. emily: after discussions with state-backed chinese investment group on a deal. $110 per share. of touchscreen technology and mobile devices and computers is targeting a deal announcement when it reports earnings. taste on thursday's closing at $3 synoptics is valued billion. the definition of change. what does it mean for investors and employees? ♪
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emily: yahoo! filing paperwork and mending employee severance
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plans if there's a change in control or sale. they approve severance packs of investors. what is it mean? joining me is cory johnson. why is they finally -- it important, what does it change? : yahoo! had a very clear plan for those employees like you enough to have change of control in their contract. hands,business changes if it changes to another entity, some particular employees who had this in their contract would be paid out. establisheddard has , as well as recently defined on april 29, talking about a double trigger. the double trigger specifically said that it was a funny statement. fundamentally, it said that a
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double trigger provision benefits require a change of control and termination of employment. running, someone else the company and someone gets fired by the new owner. today's paperwork does not appear to say much different. all employees of a certain type longer have to be fired the beach -- to be paid. the new filing specifically says a sale of all or substantially all of the companies operating businesses. the change of control would be triggered and payments or small would go to those employees with those in their contracts. emily: what is it mean for marissa mayer's? has thisissa mayer in her contract. as does the cfo. this change in control for her
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is a good one. it will guarantee even if she is ,ot hired by the new people with that change in control, it would give her a lot of interesting things. one year's salary, $1 million. a year of bonus, $2 million. unpaid bonus, 12 months of health benefits, and six months of stock options. it would be worth $8 million. all in, $11 million for marissa mayer if substantially all or all assets of the operating company are sold if they fire her or not. emily: cory johnson, thank you. oining us from l.a. we will follow that story as that comes in from yahoo! next week. dysfunction at viacom. the boardroom drama, next.
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if you like bloomberg news, you can listen on the bloomberg radio app on and sirius xm. more of "bloomberg west." ♪
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mark: you are watching "bloomberg west." camean fighter jets dangerously close to a u.s. navy destroyer in the baltic sea multiple times this week and
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according to u.s. officials, who called the maneuvers unsafe and unprofessional. russian officials dismissed the accusations. the obama administration included measures that oil companies develop plans for keeping a close watch on distant deepwater drilling operations. the well control rule comes after the -- six years after the worst environmental disaster in u.s. history. a lawsuit against the maker of the rifle used in the 2012 sandy hook shootings can go forward. 20 children and six educators were killed. lawyers argue the military style weapon should not have been sold to a civilian. calling the internet are essential to economic prosperity, secretary kerry said that government are not taking full advantage of connectivity. internet access must be included
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alongside key of the structure like roads, bridges, and the power grid according to secretary kerry. global news, 24-hours a day, powered by our 2400 journalists, in 150 news bureaus around the world. from the bloomberg world headquarters, i am mark crumpton. it is just after 6:30 p.m. in new york. i'm joined by paul allen. good morning. lead from wall street's is translating to a flat start in new zealand, the only market open. it has been open for 30 minutes and down four points. games on theing nikkei and moderate gains on the afx. it will be interesting to see the impact of iron ore slipping below $60 her ton and to the effect that will have on the local market. it has been a very good week for whol miners, rio tinto,
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question the sustainability of the price. chinese steel production ramps up after the chinese new year here at most expect it to pull back over the course of 2016. for about china later. there is a huge amount of data coming out. industrial production retail sales and gdp expected to come at 6.7%, a little weaker than the end of 2015. it is well above the to 7% range.6.5% that is what we're watching across the asian-pacific. paul allen, sydney. ♪ emily: new developments in a trial over a mental competency case.
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the 92-year-old billionaire will not have to testify next week. the case over redstone's ex-girlfriend should be reinstated at his health care -- as his health care agent. at viacom, his new ceo philippe dauman is having trouble gaining support from the creatives. out with a new "vanity fair" story, we are joined from new york. what do you make of the decision that redstone will not be testifying? >> there is a little bit of jockeying among lawyers in the last few days, which got this decision to come out. sumner's former girlfriend asked for him to be deposed because the lawyers for sumner put him on the witness list for the trial. that gave us the -- that gave
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the lawyers and opening your they asked for the deposition yesterday. today, you can see the lawyers for sumner have pulled back from putting them on the witness list . he will not be deposed, he will not the a witness. i do not think that he is in much of a condition to testify or be deposed. emily: in your reporting, do you believe he is making his own decisions? thoughtis the central that everyone wants to know. is he making his own decisions? it is very difficult to know. i had e-mail correspondence with him a year ago. i don't think that he has been in touch with very many people in the media since then, or outside of his small circle. viacom whothe ceo of was recently appointed the chairman of viacom after sumner stepped down in february, he
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would say that sumner is as good as ever, talk to him all the time about sports and the business. if you ask everybody else, they will tell you that sumner cannot speak very well, is not coherent , and is not making his own decisions. i think that is one of the things the trial was going to determine, if he is competent to make his own decisions. emily: how would you describe the feeling within viacom about philippe dillmann's performance and if he should be in the job. just bus let's look at the stock price. it is down 40% to 50%. it was the worst performing stock in the s&p index. the rewards that he got for the performance was 54 million dollars, including $17 million of payment for a three-year
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contract. ceo who is onhe the top floor of the executive building in times square and does not mingle with the rank offices,in viacom's the stock down 50%, him being rewarded with $54 million from it has people wondering if he is worth it. he was also appointed the chairman of the company to take over from sumner. a 10-1 vote, with sumner's daughter. i think there are people questioning philippe dauman's stewardship of viacom. written earlier this week in "vanity fair" there are people on the creative side of viacom wondering about philippe dauman's leadership.
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they spoke about a brain drain where the grade of types are fleeing the company. there's evidence of that. emily: legally, what can be done to change the situation? if they were a change to be made, how would that happen? >> it is very tough. at the moment, sumner redstone is alive and controls nearly 80% of the voting stock of viacom and cbs. he could change philippe dauman in a second. in the old days when the stock of viacom shifted a dollar or two, sumner would be on the phone and not adverse to firing a ceo on the spot. he has fired a lot of ceos. a lot of people point to the fact that the stock was down 50% and philippe dauman is still there, it is proof that sumner redstone is not focusing like he
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used to on the viacom stock price. you have a hedge fund, spring a look ask that management -- spring asset management. you have another large shareholder who has critiqued philippe dauman's leadership. philippe dauman has the support of the others. there was a litmus test during the opportunity that could have replaced him in february. they chose not to. he got a 10-1 plurality and a himcontract that paid a signing bonus of $17 million. when you have the board of directors wrapped around your company not performing well, shareholders advocating for change -- you have a situation that is rife for an explosion. emily: that is fascinating. a new piece in
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vanity fair at the redstone viacom drama. the new york times is looking beyond the big apple. they will invest $50 million over the next three years into a global toed nyp increase its audience around the world. it is a down payment on the era of international growth. it is a plan to double digital sales by 2020. microelectronics is hunting for a replacement for their ceo. the franco-italian chipmaker may bring in a replacement before his contract retires. also has a short list of replacements. toy're looking for a leader return it to growth. jobs ase cut several
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they continue to struggle. still ahead, event bright planning to integrate with facebook. we'll hear from the founder. who is seven the best day ever? it was 169 days in the making. ♪
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emily: snapchat has surpassed instagram as the preferred social network for teenagers. a survey polled 6500 teenagers and saw a surge in snapchat.
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that is their most important social network. last year, 33% said instagram was the most important with snapchat at 19%. days but just got bigger with eventbrite selling tickets directly through the social networking app. if an official facebook page is you cano eventbrite purchase and beer the ticket without leaving facebook. can purchase and view the ticket without leaving facebook. how much traffic you expect the partnership with facebook to drive? >> thank you for having me. eventbrite and facebook have been partners since 2008 when they launched connect. at that time, our partnership and integration with the ability to share on facebook drove a
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significant amount of traffic to our site. it was the number one traffic for many eventbrite years. this next integration is very exciting because we are taking a step forward in helping consumers find great events, hyper local events that are interesting, and allowing them to buy tickets on the facebook app and access those tickets without leaving facebook. is alsoicketmaster partnering with facebook and charging them an affiliate fee. can you explain how you make money? >> eventbrite makes money by charging a low ticketing fee. the original purpose of eventbrite was to democratize tickets. the theme of the integration rests in the symbiotic nature of eventbrite and facebook.
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we believe on bringing the world together through innovation. we are driving people to innovative experiences. we are looking at distribution, discovering new events, and accessibility, which points back to the model at eventbrite, though low ticket fee. emily: is that different from how ticketmaster has structured their deal? >> i don't have the particulars of the ticketmaster deal for obvious reasons, but our relationship does not include an affiliate fee. facebook is interested in bringing the world together and having great content in their newsfeeds. are amazing opportunities to buy tickets to a taylor swift concert, we find great value in helping you find like aevent inventory
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film festival or a mud run. experiencess and are becoming the preferred way for millennials to spend disposable income. how much are millennials driving your business? >> we dub them the experience generation for reason. three out of four prefer to spend their income on experiences rather than things. that is great for eventbrite as we help to utilize distributed commerce to help people discover new events. we will reach more millennials as they look for great ways to either rally their friends to attend an event, learn something new, or broaden their horizons. emily: you have said that eventbrite will go public. last october, you said there were no plans for an idea now or you are focused on
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self funding. has anything changed? >> i'm still surprised by this question. it is going quite well. i think great company should have great options. eventbrite is in that relm. we have built a great long term sustainable business. my cofounders and i intend for eventbrite to be an independent company. we have been forthcoming about an ipo being on our roads that. as we eventbrite have proved the sustainability of and drive double-digit growth while getting the cash flow possibility by the end of the year, we will be in great shape. ticketing business is evolving. the partnership with facebook is one thing, but the yankees printedaccepting tickets from secondary markets to curb scalping. how do you see the ticketing
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business in, and how does that affect event brigh --eventbrite ? with paper tickets and terminals, and now mobile ticketing has taken off. tied ticketsgy has to people. we have poised to personalize to getting. ticketing.ize primary ticketing is different than secondary ticketing. the way that we look at the access control issue, it is about the consumer. how can we protect the consumer to trust the transaction? and also to have a great experience when they enter an event? we have a mobile app that drives instant download and integration with entry management systems and technology that allows organizers to manage at scale events and access control. emily: it is interesting.
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the cofounder and president of eventbrite fresh off of a new partnership with facebook. thank you for joining us. the founder of the privately held cyber security firm warns that we will see more attacks tax on financial targets funds forers stole the bangladesh central bank and moved the russian ruble's exchange rate. he is said the attacks will look like cyber terrorism. attacks,fraid that the work.yptologists i'm afraid that they will employ professional criminals to hack financial systems. kaspersky adds that it
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exceeds $1 billion a year. has been spending big to snatch market share away from uber in the u.s.. is it working? an all-star lineup of economists on "surveillance." adam pozen joins tom keene along with harvard university professor tim rossebaugh. ♪
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emily: in the race for ridesharing supremacy, uber is in the lead, but lyft is gaining fast. you may have seen the billboards, that vouchers, or the half off fares. closing in? to break it down, our bloomberg news reporter who covers lyft uber and.
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.-and uber they disagree on how much market share they have. >> uber has always been a step ahead of lyft in terms of size. a big step ahead. they are focused internationally and have been trying to turn on profits in the united states, which has had them pull back the subsidies that both are spending aggressively on. it has given lyft an opportunity to grow its market share. they have grown market share, they disagree on how much. one good marker is that in the united states uber is doing 50 million trips and lyft is doing 11 million. emily: we were speaking with an investor, investor capitalist at ggv at didi, who is partnered with lyft. he thinks that it is a winner take most market. what do you think? ly.c: lyft thinks duopo
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they think that there can be 2 or that they can move to number one. they think in china there can be 2. 2 players are possible. it is hard. what i'm hearing is that it is hard to know when there are aggressive subsidies at play. lead? how sticky is this some companies switch from) to --switch from uber to lyft because they're offering subsidies. is there not loyalty to the right sharing company? eric: there are a chunk that are loyalists,sts, lyft then a segment that is going back-and-forth. those people are price sensitive . if prices and subsidies go down,
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they will go to whatever is cheapest. emily: is lyft planing to stop the subsidies or the vouchers? eric: right now they are in growth mode. iny announced the $1 billion fundraising in january. they will spend it and make uber feel the heat. i do not think they will pull back. emily: can you see uber turning on the heat? you said they will get profitability soon, but potentially putting that on pause to compete? and $2ber has $6 billion billion in credit facility. they have the money if they want to turn the screws to lyft. but, the ceo committed to being profitable in north america. they are profitable in canada and the united states. they will have to watch the situation and decide. emily: our uber and lyft
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reporter on the ridesharing wars. thank you, eric. who is having the best day ever? the golden state warriors. their victory over the memphis grizzlies cemented their place in history as the team with the most wins ever in a single season. the steph curry warriors beat the grizzlies, finishing the season 73-nine, breaking michael jordan's 1995 chicago bulls record. to the warriors. the next step is the playoffs. do us proud. that does it for this edition of "bloomberg west." fory deadline for apple access to the brooklyn drug dealer's iphone. their next step, next. ♪
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♪ >> from our studios in new york city, this is "charlie rose." good evening, i'm jeff glor of cbs news sitting in for charlie rose out on assignment. he is perhaps best known to american audiences for his performances in house. he returns to the television in the nighttation of manager. he plays richard roper. a billionaire international arms dealer. rolling stone calls him the perfect gentleman villain. we are pleased


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