tv Bloomberg Technology Bloomberg November 15, 2016 6:00pm-7:01pm EST
's of steve van and despite criticism he provided a platform for white nationalism while at right part news. speaker ryan: the president will be judged on his results. one an a person who incredible victory and had an incredible campaign will be judged on the results of his of ministtion. mark: senator democrats disagreed. harry reid had this message for the president-elect. senator reid: rise to the dignity of office. step out from behind your twitter account and show america that racism, bullying and bigotry have no place in the white house. mark: politico reports billionaire investor wilbur ross, one of president elect trump's economic advisers is a leading candidate for commerce secretary. families of some of those killed during the sandy hook massacre are repealing -- are appealing the dismissal of their lawsuit
against the manufacturer remington. they said a weapon designed for combat was marketed toward civilian. secretary of state kerry says yemen shiite rebels have agreed to a cease-fire scheduled for thursday, but the yemeni president rejected the initiative. i'm mark crumpton. "bloomberg technology" is next. cory johnson in for emily chang. snap is filing to go public. sources say may be the biggest tech ipo in recent years could come as early as march. stocks have come roaring back. thiell talk about peter and how i trump presidency could
impact technology. snapchat begins the process of going public -- the parent company snap is said to have followed confidentially for an ipo. month thed last company would seek as much as $4 billion in valuation, anywhere to $40 billionn on less than a billion dollars in revenue. what is the news? is filingp confidentially because it does not have a billion dollars in revenue yet, so it can do that. as soon asuld happen first quarter of this year, maybe as early as march. it could be up to $4 billion in what they raise and this is incredible considering they filed to go public before the election. everything seems much on track. cory: fairly amazing that if we
are talking about a $25 million or $40 billion, not be 25 times revenue at best. xcebook went out at 12 revenue and collapsed afterward. this is very aggressive rising. sarah: this is absolutely aggressive. what they are going to try to emphasize is their growth potential. on thet is very early path for revenue and have a third of facebook users in the u.s. they are not making as much money off of every user as twitter or facebook do. twitter has fewer daily active users and is expected to have $2.55 billion in revenue. $350hat will probably have million, definitely a fraction. their point is going to be to emphasize growth. cory: you had the tiger by the
tail in twitch, a business that grew so fast that had so many users and such revenue, not unlike snapchat. what is your take on a company that has decided to go public with the backing they have had? justin: snapchat has a tremendous network effect. they have people using it many times today and i don't think that's likely to change and i think it is likely to grow as more people spend more time on mobile around the world. the long-term prospects are extremely strong. cory: what do you think about the ipo is a way for a company to decide to grow to the next up? : it makes stat -- it makes sense. it's the next step to get liquidity for early investors, to get liquidity for early employees, i think it's all part of the process. prices pre-we will see in the long-term these tech companies have a strong network effect
will be extremely valuable. people think facebook is super valuable right now but they only have 1.7 billion people and ilion's more will eventually join facebook. cory: i have a chart that shows the ipo business, but we will get to that in a minute. the ipo business itself has been very quiet. if you look at this chart, the numbers we are talking about, how he ideas of happen in recent years, really know -- really low numbers for 2016. if you go here, you see the benefits from facebook, but fundamentally, 2016 is an enormously quiet year. why is that? sarah: there have been many factors why we haven't seen as many ideas as we expected. 2017 is the year we might see snapchat, uber, dropbox and airbnb get more serious about capital has but
been extremely easy to get in recent years and it looks like now may have peaked and companies may have to look for other sources of capital as vcs and later stage investors want a return on investment and are getting skeptical about return on growth prospects. cory: i can't wait to see what the numbers really look like. sarah: anyone who wants to link it to us. cory: bloomberg is here to help. staying on social be, google and facebook have announced some actions to stop users from stop posting fake stories and driving revenue after chris pointed fingers at these stories may have influenced the u.s. presidential election. that has story exploded in recent days after the election of donald trump. to me, the strongest thing about
this was the story on buzzfeed about the macedonian bloggers bring up-fake stories to generate clicks to get paid. sarah: this is an extremely lucrative business if you can figure out a way to play it. the outrage cells. clicks are easy to get on these platforms and facebook for its part needs to take a close look and is taking a close look at its responsibility for distributing information. fake news is one thing and that might be easy to quash but what might be more difficult to address is these more biased stories that give you some of the facts and maybe create a misleading perception. they are necessarily fake but they are more propaganda like in their nature. ofy: you saw the fake story the hillary clinton indictment and trumped up -- pun intended -- by fox news.
they actually ran with that story which wasn't real. founder, mark zuckerberg says only 1% of the stuff up there was fake. just in i think that's completely wrong. i think that is not accurate. viral site that was newly registered. that story was shared 216,000 times on facebook where is the new york times story that was ,rue that said hillary clinton the fbi was clearing her was only shared 80,000 times. the impact of some of these fake stories can be huge and i think it is facebook's obligation and ethical responsibility to not help spread take news. cory: did facebook make money on the spreading of fake news? justin: i don't think they are
profiting off of it specifically but it is optimized for engagement. that means people click on what they want to see and people click on what confirms their biases. facebook has optimize their algorithm to show people what they want to see and oftentimes that does not correlate 100% with what is true. cory: it sounds like they did make lots of money on these clicks, but it was set up in such a way that they were a great beneficiary of all these clicks on all of these fake, inflammatory stories. justin: when people are engaged, whether it is true or not, they spend more of their time and attention on facebook, so they are benefiting from it. on the last conference call, facebook was warning us that revenue was going to slow down. the zuckerberg talked about
election and how many election-related posts were clicked on, citing that is one of the things that was stronger in part of the third quarter but not going forward. sarah: now they are trying to say we did not have a big influence on the election. we are just one of many outlets people can get their information from and that masks the fact that facebook is a place where a large percentage of americans find their news and get access to their information. but facebook itself once to be seen as a median -- a medium for this information and not control how it is spread. they want to be a place with posts from friends and family, but a lot of the post this year have been about the election. and they have spread a lot of these things and facebook wants to be as far as possible away from being any kind of arbiter of truth.
there are some technical ways they can address this problem that don't go against their neutrality. cory: it is an interesting problem for them to deal with. it's a whole different animal for facebook. thank you very much. ahead, john lyons said and we will talk but is complete it may be looking at an ipo and their close ties to donald trump. this is bloomberg. ♪
will peter thiel ring to president-elect donald trump's transition team. is one of the smartest people i know. what is unique about him is he is able to look at things from a contrary in perspective. the way he maps out the world is not the way people in the media lk about what matters. having peter there will give him a perspective. you think his priorities will be? joe: i'm not sure what his priorities will be. i think he has a lot of common sense around things that matter for the tech sector. i think peter really believes in making america a place where you are continuing to advance and build new things and think about the future. 1960'ss about how the were looking to the future and we are have that anymore and i think he's going to try to
figure how to put that back into place. >> do you think his role ensures a positive or at least an accommodative environment for technology and maybe even silicon valley more specifically? joe: i don't think you can say anything for sure. it gives me a lot of comfort that it's going to be good for up-and-coming businesses. for established businesses, i don't know if he can protect them or not. work given the kind of palantir has done for the u.s. government, what kind of restriction does it face in saudi arabia? on: i think the restrictions palantir and i can only speak is a cofounder, not someone running it -- the u.s. government has encouraged palantir to work with other countries and go after terrorism is one of the things that they do.
governmentst of that want to help work with the u.s. and do that job but obviously, they are not going to want to report regimes doing things against our own civil libertarian values. positions like you can't work with certain parts of china or iran, but i think a lot of the world has become more self-imposed in terms of what silicon valley wants to help with. the curious things about palantir is that it remains private. if not mistaken, your cofounder remains ceo of the company and set running a company like this would be difficult if it were public. do you think that is still the case? joe: i think a lot of these founders are very bright people that i learn a lot from an overestimate how hard it is to be public. a lot of people are very scared of becoming public and a lot of people who have made the transition, it's not as bad as
you think. erik: do you think the time will come when palantir can go public? joe: i think so. wouldearly shareholder, i like to see it earlier and i understand why other people might want to delay it. trends inll the technology today, whether it is a big data, machine learning, ai or a taunus cars or anything else or that matter because the list goes on, what excites you the most? is how thexcites me big industries are going to change over the next 10 or 20 years. when you talk about ai, those are tools that we use. the fundamental truth is data is not being used to run these ministries the way ought to be. there are platforms being put in place to harness data that for the first time is input into health parts of health care are being run it will make those industries work in a better way. i'm excited about fixing big
industries and using technology to run them. erik: one of the questions you must get all the time is what happens to the jobs? joe: that is another great question. i think jobs are not as much of a zero sum thing as you think. if we're going to get rid of the manufacturing jobs, that means we have a world where everything you could buy is extraordinary -- extra nearly cheap. the cost of everything we buy 98%.down by there are services jobs, entertainment and other this people could do to create wealth, so i think it is a golden age if we can all afford things cheaply. erik: how do you capitalize on that as an investor? joe: i think the shift that is going on is the platforms that we put in place. don't figure out what those platforms are and invest in this platform companies. cory: joe lonsdale that was joe lonsdale and our own erik
cory the business of running a stock exchange has changed quite a bit. requirements are different. after that come a changing of the guards. eddie lou talk to the incoming friedman onadena changes at the exchange. with: i've been working bob now for 10 years and when i came back as president and coo, he and i have been partnered together to make sure we are optimizing the business. i feel like i have my handprints on the vast majority of what we
have been driving toward and focused on. my job is to continue the journey to make sure we continue to be a critical market for an infrastructure provider. bob has been very focused on technology and expanding those capabilities at the nasdaq. will that be a major focus going forward for you? adena: technology is deeply embedded in our dna. it's how we got started to be the first electronic exchange. our will continue to be focus and how we can bring emerging technologies to interact with the capital markets as efficiently and effectively as possible. service, all the other things that come with being a world-class exchange. betty: is there anything different you might do, anything
you might expect to see out of the nasdaq? we have been transforming nasdaq into a global market technology provider and i expect i will continue to take that journey with the clients and we continue to be an exchange operator. there's a lot of uncertainty around policies in general. we were just hearing president obama talking about what may or may not be expected. talk as weot of heard from president-elect trump as we heard about rolling back some regulations imposed on the financial world. how's that going to affect the nasdaq? to the extent we do have a republican administration and they show a pro-business orientation, that does tend to come with what i will call balance in regulation.
has impacted our industry has been dodd-frank and while there are a lot of good safeguards that have been put in place coming from dodd-frank, there has been unintended consequences. notably banks are no longer in a position to offer much-needed liquidity in some of the markets where we operate. we would like to see the opportunity for dodd-frank to be modified for banks to take responsible risk taking to provide that really important liquidity. betty: modified or retracted? adena: we have to recognize an enormous amount of work went into the creation of. frank and there's a lot of reason for it. we recognize the history we come from but we know whenever you put in new regulation, there are unintended consequences that come with it. how can we make sure we are modifying the regulation to make sure it is having the impact you
wanted to have? betty: would you say president-elect trump is good for the exchange? for the financial market? adena: from a we have seen so far, which is only one weekend, a republican administration with a pro-business orientation is good for the financial industry. cuty: he has pledged to back on corporate taxes. how big an effect is that going to have? adena: if you have some of the tax policies they are considering, they repeat ration thingslida a other that make it so companies can optimize the cash they are generating and reinvesting in the business appropriately and reinvesting in growth, that is good for the economy. cory: our own betty liu with adena friedman. $.10, the chinese internet giant set to report third-quarter earnings on wednesday.
last quarter, they delivered $5.5 billion in sales, a 52% increase. appa's popular messaging wrapped up a purchase of a game maker. up next, one of the fastest-growing startups in silicon valley, we talk about the future of cyber security under a trump administration. if you like bloomberg, check us out on the radio. check us out any time on the bloomberg radio app. this is bloomberg. ♪ ways wins.
with high-speed internet up to 10 gigabits per second. you wouldn't pick a slow race car. then why settle for slow internet? comcast business. built for speed. built for business. we're opening more xfinity stores closer to you. visit us today and learn how to get the most out of all your services, like xfinity x1. we'll put the power in your hands, so you can see how x1 is changing the way you experience tv with features like voice remote, making it easier and more fun than ever. there's more in store than you imagine. visit an xfinity store today and see for yourself. xfinity, the future of awesome. mark: i'm mark crumpton. you're watching "bloomberg technology." french president says that paris climate deal is
irreversible. respectthe u.s. must the decision by the obama administration to sign off on the agreement. president-elect all trump has called global warming a hoax and promised to respect the decision by the obama cancel the landmark deal. write it police in central athens used tear gas and stun grenades to break up marchers protesting president obama's visit. it remains a strong anti-american tradition among some greeks who resent some of the u.s. policies in the 60's and 70's. a death sentence was struck down against egyptian president mohamed morsi. the ruling means more -- means more see will get a new trial along with five other leaders of is now banned muslim brotherhood group. their death sentences were also set aside. the bank of england governor is urging financial services firms not to make any rash decisions on moving operations out of the
central the european bank official revealed many firms expressed interest in taking such action. banks are set to start the process of moving jobs within weeks of the british government triggeri brexit which is scheduled to begin by the end of march 2017. it's just after 6:30 p.m. here in new york. paul allen has a look at the markets in sydney. take a look at the a sx after 30 minutes of trade. doing reasonably well with oil and energy stocks following oil prices higher overnights -- overnight. iron ore off 9% overnight. a look at fortescue metals, one of the worst performers today. white haven coal is the second worst performer right now. on the subject of coal, west
farmers looking to sell two of its mines, one in queensland and one in new south wales. $1.5sale could fetch billion. the new zealand stock exchange up .6% right now early on wednesday afternoon. nikkei futures looking positive. a couple of earnings to watch for out of asia. i'm paul allen in sydney. more from bloomberg technology, up next. cory: this is "bloomberg technology." i'm cory in for
emily chang. one of the big unknowns is the threat of global cyber attacks. russia was said to be responsible for attacks on democrats and trump disagreed. trump said he would fight fire with fire when it comes to cyber security. mr. trump: there's a deterrent against attacks the united states must possess and has to the unquestioned capacity to launch crippling cyber counterattacks and i mean crippling. crippling. the warfare of the future. america's dominance in this arena must be unquestioned and today, it is totally question. cory: is that the case? ofning us is the ceo obtaining them. it's one of the biggest companies in the u.s. also with this is bloomberg technology's brad stone.
for joining us. let's start with the events in washington d c. canda trump rebuffed some evidence that russia was responsible for the hacks on the dnc. trump.is president-elect how are cyber secure he firms viewing the election? think we as a community are interested in seeing how he rather than what he says as a candidate. i think he's got some good advisors. i think peter thiel will be a really good influence there. i think the reality of the situation is it's harder to do it when you're sitting in a chair and got the responsibility and the results rather than just talking about it. colleaguetold my emily chang that you meet with ash carter regulate. do you expect that to continue and what do you make of the names being bandied about for
donald trump's defense secretary like jeff sessions? guest: we have had a great relationship with secretary carter. he's done a lot to make the dod a much more approachable environment. his initiatives have been somebody and i think who knows how the system works in washington is really important. jeff sessions clearly has a lot of experience. things that need to be fixed. first, the whole appropriations system. the way they are getting a budget is hard for our customers in the dod. if they stop doing things like sequestration and continuing resolutions and they've got the budget to fight the good fight, that will be better. we really need a president who sees this as a critical solution that needs to be addressed.
i think we have both of those things and secretary sessions, if he is there, understands the problem very well. little about the company and how it relates to cyber security. providehat we do is visibility on large environments that are changing quickly. if you look at the department of defense, they've got four plus million computers. sometimes it's hard to see where they were and what they were doing, whether they were secure, and be able to fix them in real time. we have provided a platform that allows them and many large global institutions to see exactly what they have and fix it. peoples out overcomplicate this problem. it is a problem about hygiene, making sure the racing things you are supposed to dore being scale thatat a large
is hard. brad: some tech companies have talked anonymously about moving servers overseas. comes down onrump the law enforcement side of the equation when it comes to encryption. is that too extreme? guest: i don't think it's too extreme. i think there are times where privacy and security are at odds. we work with law enforcement and want them to have the data they need to do their job because you and i and everyone listening rely on them to do a good job. conversely, we have an expectation for privacy. if i had a black hole in my pocket and i could throw anything in there and perfect encryption made it so no one can get it, the whole idea of law enforcement becomes more difficult. data were no one could conceive of the possibility of ever getting to it, it might be rational but
conversely, donald trump has the most effective offensive capabilities that have ever been invented in this world. on the cyber side, the nsa and many of the things he governs have long reach. you can move your servers out of the country. brad: we've seen a lot of countries do this, setting up data centers in ireland and new york. every company from cisco to hewlett-packard, microsoft with concern about the nsa. what do your customers say about that going forward with the notion that returns of some of the practices of the past that caused companies to lose business? we refuse to host our customers data because i don't want to be part of that discussion. it is extremely difficult when you have customers data and someone walks in with a court order and someone wants you to disclose it.
our customers are more capable of making that decision and we are with that data. today, bloomberg reported filed privately. are we going to see an ipo and will the climate he amenable to finally going public? i've been on record saying i think an ipo is the right way for a company like ours to proceed. i think it is fair to my employees, investors and customers. we think the time horizon is reasonable. when i look at these companies that want to stay private, they don't want to deal with investors or the fcc, i understand the appeal but it's
not the constituencies we run this company for. forhink we will be ready the foreseeable future and i have been clear about our constituency. brad: it's one thing to have a sometimestion, but they've traded on the stock exchange and there some new level of trust in your product. guest: the mission we are on here, we do one of the most important things our customers will ever buy. we secure their core information. are able to grow in a sustainable way and i think the disclosure rules companies have to go through force good discipline and management. a lot of ouris why peers are not super excited about it.
people don't like it when people are looking at them when they are not doing the right thing. i think it's healthy for people to know we are being scrutinized, our numbers are being checked and our customers know we are going to be here tenures now. i hope we are doing this interview 10 years later and i get to be in this seat. i have no other dreams other than running this mission. cory: that is reassuring to hear. ahead, we're going to head to saudi arabia to catch up with sebastian to see why he is optimistic about a trump presidency. this is bloomberg. ♪
help the country focus on something other and oil. -- erik schatzker sat down with sebastian thrun. they talked about whether a trump presidency present a dark cloud for technology. sebastian: if you look at the stock and bond market, it has been moving away from bonds. for the tech industry, it is an opportunity. it is a great reminder. erik: peter thiel is part of donald trump's transition team. does he have silicon valley's back? sebastian: i think that is being debated. and silicon forward valley is a very democratic place.
happen what is going to -- we don't know what it means. i am optimistic. i think he wants to bring us forward. erik: people know you best for being one of the chief developers behind google possible driving car every day, it seems like the dream of autonomous vehicles are that much closer to reality. the question is how much closer? how long before we are there? sebastian: i think we are really close. i sat in google cars for many years and a drive that are than most people drive. launching your first products in moving to the market. erik: what is the business model for autonomous vehicles? sebastian: there are models
tesla has. i love it. transportation is a service where you have an uber-like carany where you order your , it comes and takes you up. then you waive it goodbye and it goes to someone else. ultimately there is a bigger impact for disruption in the world. only about a third as many cars as we need today. easy in as really scenario to figure out who the losers would be in the world of self driving cars. if they're going to make one third fewer vehicles and they make today. based on what we have seen and what you know, which some
pennies will the winners be? companies have a strong position. the incumbents are hard to move forward. companies like google and uber. the united states has long been, perhaps for the past half century has been the heartbeat of innovation. where is that going to be 50 years from now? i think the united states can stay at the head of innovation. i'm a big immigration fan. i am an immigrant myself and i've given a thousand people jobs in my little career. but we should keep smart people immigrating to silicon valley. if you don't do this and focus on things like education, others will take over like china. erik: what if a new government
shuts the door to immigration? sebastian: i hope the new government will not shut the door to immigration. there are certainly questions about legal immigrants, but we are a nation of immigrants. happen, whatere to happens to silicon valley and american competitiveness? sebastian: others would take up and -- pick up and take over as the most creative nation on the planet. andeed to let them emigrate build businesses and create work for americans. erik schatzker with sebastian thrun from riyadh. tomorrow, don't miss it, jim chanos on the fed, the election -- he was a big hillary clinton supporter and the pending tesla and solar city merger. that's 4:00 wall street time. the growing wealth
cory: twitter making changes to harassmentdeal with and abuse. it has been a top complainers -- top complaint from users and one of the reasons twitter failed to find a buyer a few months back. now users can filter out certain words and there are tools that even block entire conversations. bigme inequality is a driver of u.s. election results and sadly, quietly, the income gap is extreme and the heart of technology, silicon valley. they have 76,000 millionaires and billionaires and many of them are giving great gobs to charity. at the same time, nearly 30% of silicon valley residents rely on
public or private assistance to get by. studyst co-authored a that looks at these issues in silicon valley and joins us from san francisco. this is a disturbing report because you have people who have made fantastic amount of money were very active in charity giving money away, yet they live among so much poverty as if the money they are giving away is not having an impact. why is that happening? guest: a lot of these wealthy individuals -- it's a huge continuum, 76,000 as you said you they are not aware of the local need and it's hard to imagine when these two separate groups of people are living blocks or miles part, often separated by a freeway. the first issue is awareness. understanding poverty is happening in their own backyard. once they understand the issues, we are hopeful they will
understand and think about how they can deploy that locally. hear one of the things i from entrepreneurs as they want to really invent philanthropy and go to the places where they will get their biggest bang for the buck. one of the things we see is wanting to go to places where things are cheap which is not silicon valley. placesthere are a lot of that have greater return or social impact, but we are living in these communities and we are responsible for them. we are talking about the kind of communities they want to be living and working in. even though the return on be more expensive, we think it is worth allocating part of your port olio to these issues. to allocate a portfolio where your family wants to work and where your family wants to be. causingat is the thing
these nonprofits in silicon valley, what is the biggest problem? the biggest problem we found is they are being displaced, much like the middle being nonprofits are also displaced. what is driving them out is the cost of doing business and the cost of rental space. also wages are going up. we have one of the highest minimum wages in the nation and competing for executive talent against some of our really competitive companies here. and there is a talent war. talent can go other places including the private sector. they literally often cannot afford to serve the public -- the populations here even know they are growing and demands are increasing. cory: we have seen high profile examples of some of these like
stocks for gopro putting into a fund where they can direct what they want to do with it. are they actually selling the stock industry beating the money or is it just sitting there? guest: what is great about donor advice fus is they provide a place for someone to make a charitable allocations and then there's a place for them to go out. people are spending and allocating 30% of those accounts annually which is much larger than the 5% required. adviceited about donor funds because they provide an immediate way for people to get involved in philanthropy and then they can take their time. the issue is how can we accelerate and make them more confidence of a can find andrtunities to give basically directing that money to causes around the globe and
causes in their own backyard in silicon valley. cory: it looks like it was a time of work but it is a fascinating read. little disturbing to know we have such poverty so close to such incredible wealth. need: the first thing we to do is just make people aware of it. silicon valley is not unique in this way, it's just staggering because we know the amount of millionaires and billionaires that live here so it is a sexy story. the first thing is for wealthy people to understand the data. cory: i'm going to post the report on my twitter account. all the episodes are available live streaming. check it out at a bloomberg tack every day. this is bloomberg. ♪
♪ announcer: from our studios in new york city, this is "charlie rose." bernie sanders is here. from vermonttor and then he announced his candidacy from -- for president of the united states. sanders went on to receive more than 13 million votes across the country winning 22 states. his campaign struck a powerful