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tv   Bloomberg Technology  Bloomberg  November 21, 2016 6:00pm-7:01pm EST

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the coast of japan. a tsunami warning for weights up to 10 feet has been issued. north of tokyo and home to the nuclear power plant that was destroyed by a tsunami following an earthquake in 2011. "bloomberg technology" will have more on this story. president-elect donald trump spent monday holding meetings with potential cabinet members. kellyanne conway was asked with -- about the level of diversity. >> he has met with women and people of color. he is met with them here and in new jersey. we are very heartened and touched by the number of people, including people from across the aisle. people who are traditionally more progressive. the united nations humanitarian chief says the conditions in aleppo have gone from terrible to terrifying and now rarely survivable.
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he told the un security council that food is scarce with prices getting higher. fuel for gas and cooking most neighborhoods. "bloomberg technology" is next. ♪ emily: this is "bloomberg technology." coming up, the postelection party continues. stock indexes hit records today for the first time in 17 years. began.et the doorbusters the biggest shopping days of the year are almost here. we will tell you how big black friday and cyber monday could be. has been bought.
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we will look at the post deal. --are monitoring a might magnitude 7.3 earthquake that struck japan off the coast of ma. she must -- fushi we all remember the tsunami they had in 2011. a sin on me alert has been triggered again. what exactly is the latest on the damage so far? we are looking at live pictures the broadcasters there. they are predicting waves of up to three meters. >> we have had the initial wave of the tsunami hit the coast of fukushima. the damage from the quake and tsunami so far has been limited.
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at this point what we are looking into is the damage, or rather the cooling system at the fukushima plant, it is used to cool the radioactive elements and it has stopped. they're saying this will be an issue, but it is something i think we need to keep monitoring. obviously this is the same reactor that was hit five years ago. talk about how the plant in the -- and the area has recovered in what could be another blow. >> the area has evacuated and many have not been able to return. -- they are there to contain the situation and the situation has so far been stabilized since the 2011
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earthquakes. the damage on the nuclear plant itself as far as we can tell, has not been anything significant. the only thing worrying at this point is the fact that the cooling system has stopped. this will not cause any immediate impact, but it is something that will need monitoring. the prime minister has just spoken from argentina. tell us about what he had to say. that basically has said there were lessons learned from the 2011 quake and tsunami and that the government has gone into action and is ready to take further action as needed. the local broadcaster has been warning citizens throughout the morning to evacuate and head to higher ground. all right, our tokyo
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bureau chief. thank you for that update. we will continue to monitor the situation in fukushima. we are now days away from the biggest weekend of the year for u.s. e-commerce. according to adobe digital insight, next monday is expected to be the largest online shopping day ever. at pwc, and david kirkpatrick is a contributing editor. thank you for joining us. steve, just how big do you think this cyber monday will be? steve: as you said, it will be the biggest cyber monday on record. he also think this will be the biggest holiday season on record with consumers spending 10% more this year than last year. the majority of that growth will be online. emily: wife? -- why?
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steve: they have taken the friction out of the process and encouraging technology. all of the factors are in place for this being a great holiday. is taking an even larger share. talk to us what we are seeing with regards to amazon versus traditional retailers. interestingly, clothing and apparel. steve: it is fascinating. amazon takes about 90% of the share. nine out of 10 consumers told us they shop at amazon. 40% of those say that as of their relationship with amazon, they are shopping at fewer retailers, and 20% say that because of the relationship with amazon, their shopping if you are websites -- shopping at fewer websites. emily: david, amazon is making
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its own clothing. do you think there is any way any other company can tip the scales versus amazon zero this time? no.d: tipped the scales, thierk there lead -- lead is so formidable that not even walmart can top that. one of the interesting statistics i saw in the pwc report was that 56% of consumers seek out independent retailers. i think now ordinary shoppers are starting to realize that these monoliths are strained hurt their local stores and they want to help them. that is interesting and could be a big trend down the road. emily: last year, warm weather led to underwhelming closing sales. how are retailers changing the strategies? steve: they are much cleaner
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but their inventory levels, the weather is finally breaking on the east and we are going to see some cool weather and it will hopefully lead to sweater sales. emily: what trends will we see in black friday and cyber monday deals? it seems as a consumer, the deals are happening all week long. i just got one today that was 50% off. black friday has become black november and retailers are issuing deals throughout the season. we have seen a blurring and there are great deals all the time. emily: will there be great deals over the next few days? should we wait three days? steve: when you see it, go buy it. retailers are ready because they need to compete with amazon and they need to get the deals out now and consumers are ready to buy. emily: david, you can see i am concerned about my shopping strategy. david: steve should know you're
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asking for yourself. emily: [laughter] mobile.alk to us about will that drive much traffic? steve: it will. .5% of digital sales will be on mobile devices this year. retailers have done a fantastic job of making the ease of the transaction so easy on the consumer that they are going to do a great job and complete the deal. emily: does it surprise you at all but after a fairly surprising election that this would be the biggest year of spending ever? there are a lot of things that don't always add up in today's political and economic environment. the economy is doing really well, so no it doesn't surprise me. there is a lot of optimism about our individual lives, even
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though we may seem to have a lot of pessimism about who our leaders are. no, it does not surprise me, but i think -- we are in a strange time with a lot of things are hard to understand, let's put it that way. emily: we will talk more about that coming up. david kirkpatrick is sticking with me. steve, thank you so much for stopping by. all right, sticking with amazon, the e-commerce giant is exploring a new way to lure customers, live sports packages. aaron talks with several professional leagues, including the nfl. a premium sports package could sign up new customers to amazon prime and bring new revenue to add-on services. ofr the next hour, a roundup the top tech stories to watch this week. apple abandoning his development of wireless routers and turning back to consumer products.
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products, that is. how long can it rely on the iphone? we will tell you what investors are waiting to hear. this is bloomberg. ♪
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emily: turning now to an ongoing debate. fake news on facebook's way the presidential election? mark zuckerberg originally told us this. that fake the idea news on facebook, of which it is a very small amount of the , influenced the election in any way, i think is a crazy idea. but after a lot of
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backlash, zuckerberg seems to have ever so slightly changed his tone. in his latest post he wrote, "we believe in taking this seriously and giving people a voice. we do not want to be arbiters of truth ourselves." that would bew the interview of the year potentially? of the slightke change in tone, yet still maintaining that fake news was a relatively small percentage of news on facebook? david: i think it is a change in tone and not opinion. he would still say, i don't think he would use the words again, but it is a crazy idea becauseald trump won of face news on -- fake news on
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facebook. that because of pushback from the president and "the new york times" and other places, they are taking this very seriously at facebook and know they have to make changes. what i found impressive, given the pace that things are going, that zuckerberg on saturday was outlining a series of very specific steps that they are starting to take to think about how they can change the way the algorithms work, the validation of news here it there going to make concrete changes, there is no question. some ofet's talk about the changes. stronger detection, third-party verification, raising the quality of related articles. are these changes enough, and should they be doing more? should they have more human editorial judgment involved? i think the question of
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whether humans or algorithms can do a better job is not really isn't it -- easy to answer. it is not possible given the volume of content they have to , the algorithms will have to do the heavy lifting. that does not mean they don't need people. thathave had people basically are looking at things all the time. not just news stories but posts by individuals that are also false or harmful and making very quick judgments. we will see people involved. but whether they should have an editorial department and have ,ournalists getting involved they might have some people involved at the policy level and big picture level, but they are never going to be able to use those people for every fake news story, there's just too much to
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identify. emily: bloomberg did just interview a facebook vice president in london, nicola mendelson. take a look at what she had to say. >> we want to make sure people are seeing information that matters most to them, and if they don't want to see that information, they can choose to lock it. emily: fake news aside, what about a potentially bigger problem, which is that facebook and twitter have created an infrastructure in which we can , interactr own bubble and only see news from people we like and people whose views we share? is that potentially a bigger problem? david: i think it is. i would say most users of facebook would say it is something they experience. i specifically asked zuckerberg about that in the interview, and he said that the problem was more that people get the
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contradictory views in their newsfeed they don't read them and just scroll by, which may be true, but one could argue that they need to do something a little different that me put a brake on that. i think the problem -- your colleague sarah frier said something yesterday, that they really want to do what is best for the user. i think that is what nicola was saying as well. going to improve the user experience because that is their bread and butter. it is probably starting to affect the user experience and a way that is serious and that is incentive to take action. emily: this is certainly not the last we will be talking about this issue. david kirkpatrick, sticking with me. coming up, apple closing down its router division. what the move signals for its focus on consumer products. this is a bloomberg. ♪
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emily: apple has disbanded its
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division that develops wireless routers according to people familiar with the matter. the move is intended to sharpen their focus on other consumer products that generate the bulk of its revenue. alex webb is here with me your is interesting that apple is doing this. why? market that has increasingly become a commodity. if you sign up for a service, you will be giving a router. it costs money to develop the stuff, and it is not a project a lot of people are going for. emily: will he be significant amount of resources for other things? alex: probably not. amazon has built this into some of their echo devices. story another interesting by our colleagues is that it turns out, the first line is
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that, it turns out that not all iphone 7's is rated equal. -- created equal. explain this to me. alex: they end up essentially equal. we think apple are throttling the chips from qualcomm to ensure they are like the chips from intel. emily: they should perform differently but they don't. the qualcomm chip is a little bit better than the ones from at&t, but in practice they perform at the same level. emily: clinton this upset some customers? -- couldn't this upset some customers? alex: not customers themselves. but it means that iphones are not as fast as those who are using only qualcomm chips. it is played by apple to manage
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their supply chain. emily: everyone is questioning the future under president-elect trump, what that will be like. he has talked a lot about apple bringing jobs back to the united states and people have told me it is unlikely iphones would be manufactured here. what is your take? alex: on the one hand, manufacturing costs in china are infinitely cheaper. 10 times cheaper per hour. if there was manufacturing itself coming back, automation is so much better than it was in the days of your. per hour.sts $.75 in the past when there were repacked ration breaks, all that happened was it paid for share buybacks and increased dividends. emily: investors benefit, not jobs. alex: more likely to be the case. emily: thank you for stopping by.
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the hewlett-packard brand is focusing -- is a faster growing i.t. unit. scarlet fu looked at the details behind the financial performance. they report quarterly earnings after the closing bell. the business is split into two separate companies. enterprise.s hp let's take a look at hp's revenue breakdown. it's enterprise group which includes servers, storage and networking makeup 50%. is 37%, thegment purple. when it comes to the bottom line, hewlett-packard into price is cutting costs and restructuring to increase earnings growth. does face macro economic challenges and tighter corporate budgets and threats from the
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cloud. the cloud offerings are likely targeted at private clouds, that is the yellow section, the middle yellow section. it is a growing segment within the confines of traditional i.t. infrastructure. write a cloud spending they reach $20 billion in 2019 as traditional i.t. spending declines. the hybrid cloud model uses a mix of private and public services. hp recs this will become a $100 billion market. e majors and driven by cost structures rather than sales gains. they could accelerate the timing and magnitude of that margin expansion. enterprise, the orange line at the top, and hp ink, the blue line, are both beating the s&p 500 over the past few months.
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their strategy is to be a small, nimble company that is focused on hybrid technology. the hardwareink is company, the legacy printer and pc bigness. we will be tracking both y's interest. emily: still to come, delegates from the u.s. and china talk trade this week. we will talk about what donald trump's policies mean for tech in particular. this is bloomberg. ♪
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>> and truly great and talented men and women, patriots are being brought in and many will be a part of our government. helping us to make america great again. >> multiple fatalities are being reported after a school bus crash in tennessee. 23 people were taken to area hospitals. at least 35 school children were on the bus. no information is available on the extent of injuries. the students ranged from kindergarten to fifth grade. this is bloomberg. it's just after 6:30 p.m. monday here in new york. i'm joined by my colleague who has a look at the markets.
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paul, good morning. good start off to a 1%. eight-tenths of not surprised to see the energy stocks performing well. billion acquisition of the building company. the c.e.o. saying that is likely to play favorably into the infrastructure expected in the united states. elsewhere, and up a quarter of 1% and futures are still positive this despite the 7.3 magnitude earthquake in japan a short time ago and a tsunami warning. the dollar is showing new strength as well, regaining some of the ground lost mainly due to
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the greenback weakening. this comes as the reserve bank of australia and there will be a speech about australia's economy in transition and given that speech. they are warning of a further easing as china begins to crack down on speculation again. that is some of what we are watching around the asia pacific. more from "bloomberg technology" coming up next. ♪ emily: this is "bloomberg technology." they meet in washington after
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president obama met with pacific rim leaders to talk about the t.p.p. trade deal and a hot button issue. president-elect trump has vowed to kill the deal and threatened to retail yate against china and trump could spark a trade war. president obama alluded to that. president obama: i believe the answer is not to pull back or try to erect barriers to trade given our integrated economies and global supply chains that would hurt us all, but rather the answer is to do trade right, making sure it has strong environmental standards. emily: joining us now is brookings iran statute vice president of government studies and our bloomberg news reporter and david kirkpatrick in new york. there is a lot of uncertainty
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which campaign promises president-elect trump will keep. he has released a video message in which he addressed a few of these issues including the t.p.p. and see what he had to say. >> on trade i'm going to issue a notification of intent to withdraw from the transpacific partnership, a potential disaster for our country. we will negotiate fair bilateral trade jobs that bring it back to american shores. emily: i'll start with you, what's your reaction? >> he is doing what he said he s going to do in the campaign. china basically is trying to exploit this possible move by the united states to tell the countries in that region we will create a free trade agreement
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with you. emily: we have sop numbers showing how much is at stake in the u.s.-china relationship. the u.s. importing $480 billion worth of goods. lulu, you are on the ground with the leaders of chinese businesses, what is the reaction within china? what are business leaders saying? >> chinese tech companies care about how trump policies will be. you might be wondering how the companies that are largest. counting from the top, if trump wants to create more jobs and they are assuming that is a priority, they will need to work with chinese companies that are investing in the u.s. and china acquire more products from the u.s. as chinese consumers
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upgrade. they said that in silicon valley is trying to bar immigrant workers. china is going to take those workers as china needs to create its own technology boom going forward. emily: president-elect trump is supporting the promises he made on immigration. i will direct the department of labor to investigate all of these visa programs that undercut the american worker. david, we are starting to see some policy intentions take shape here. what do you make of it? >> a smart global business leader once said to me there is a global battle under way between china and the united states and every country around the world is looking at the two systems, one very top-down and autocratic, one democratic and highly capitalist and to see
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which one gets the best benefit for its people. i think unfortunately a lot of trump's proposals don't factor the global impact of his actions on that battle. and as darrel and others have been explaining, the possibility is really great but china may gain the advantage on short sighted actions we are about to take. on impact of tech companies, it is interesting to think that the chinese companies will benefit. emily: darrel, how likely is an actual trade war? in the traditional sense of the word. advisers have said china's interactions with the united states have added up to an undeclared trade war. how would this be different? >> i think it would be devastating if the united states did start a trade war. trump has talked about imposing tariffs on goods coming in from
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china because as you point out he accused that country of manipulating its currency. if he does something like that, retaliation will be coming from china. the infrastructure that is supporting globalization is going to fall apart and becomes a catastrophe for many different countries. emily: lulu, what companies in particular would feel the effects of this the most? >> well, like i mentioned earlier, alibaba is expanding. u.s. is one of the core tarts. for them to go into the u.s. in the future, they need to procure products and aretargeting u.s. customers and policies could potentially affect them. their core business, not so much. but in areas they would like to expand and hollywood movies,
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that is an area that would likely affect them if they were to buy hollywood studios and we are starting to see a pushback there. >> darrel, a lot of folks i have been talking to is bottom line trump is a businessman and will recognize the relationship between china and the united states is very important. do you think that ultimately, we will see a softening of the rhetoric and softening of the actual policies put into place or do you believe he will take as hard a line as he says he will? >> i would hope there would be a softening just as he starts to realize what some of the negative economic consequences are going to be. going to be difficult to bring manufacturing jobs back to the united states because of the cost differentials. much cheaper to produce those products in china. the thing that i worry about when you look at his initial administration appointments, he has appointed hardliners to key
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positions. that would suggest that he isn't going to soften some of his positions. emily: there is a contention that president-elect trump may not understand exactly how many jobs would be created, for example, if apple moved manufacturing of the iphone or part of it back to the united states. we had a bloomberg reporter said it wouldn't create that many jobs because automation is so good now. where do you see this actually going? >> that was amazing statistics that alex mentioned. t costs 75 cents an hour to do it in china. those numbers don't lie. ifthose are right and close to right in any case, there is no way that we can bring a lot of manufacturing back without either not creating jobs or
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dramatically increasing consumer costs. if people want things to cost more, fine. bring those jobs back and create manufacturing jobs in the united states. i don't really see how this is going to play out. it's one of so many things that i said earlier in the show is pretty darn hard to predict right now. trump's rhetoric seems to be contrary to logic. emily: and so is the rhetoric that likely won him the election. thanks for sticking with me. now to a developing story, federal authorities are investigating an accident involving a massive experimental drone developed by facebook. the social network said no one was hurt during the test flight. the ntsb has not released the findings of this particular investigation. coming up, another multibillion
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dollar deal, but are there even more deals to come in software? next. this is bloomberg. ♪
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>> flagship product which is bleeding sales. growth has been hard to come by and what they are trying to fix is acquire a steady revenue stream from a company and it hardly addresses the problem they have in the consumer segment. the blue coat acquisition was targeted at the enterprise segment. emily: let's talk about the consumer it and it was loaded on to p.c.'s and the world went mobile. how global are they able to compete where there are a lot of mobile threats? >> you are absolutely right. the security landscape has changed completely and you are seeing the rise of smaller
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vendors who have done well and scaled themselves up to $400 million who address a specific portion of the threat. they are not integrated platforms. so i think what you are going to see is a lot of these point solution vendors being acquired because the growth is slogan can't addrs overall problems. they are putting the pieces together but you don't know if they are there. emily: it's interesting to see it take shape now that we know it's donald trump who will be in office in january. this deal may have been in the works for a long time. but what do you expect for m and a? >> there are a lot of reasons to expect it to grow and not shrink. if the repatriot ration of
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products is allowed which is going to happen in some form, that gives these companies a lot more money to spend domestically. they are buying companies overseas and that will be a factor to increase m and a. we are entering into a very uncertain environment. and business leaders generally like to be big and thinks that makes them feel a little safer. that might be a force going towards m and a and the change accelerates. so they have yet another reason. they have to buying new tech. buying a management company is great. they didn't develop it themselves and got it from somebody else. emily: what do you think of that. they have had run-ins with the f.t.c. over falls advertising and made bold claims over
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protecting customers' identity. do you think the company decided that bigger is safer and we are willing to deal with some of these issues? >> absolutely. and the fact that they already have four million customer base. t goes to prove revenue stream they are getting is trying to address the problems. so it's a very good idea for them to pursue this acquisition. the only problem is they don't have the band width to pursue more deals like that. the debt could be downgraded to junk. it doesn't leave them much room to pursue deals like this. emily: thanks for sticking with me. up next, instagram joins a live video gram and are the copycat
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features smart? ♪
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emily: a story we are watching. testing demand for propped nigs offering. the i.p.o. could be as big as $750 million. the company will gauge interests. meitu hasn't decided when to begin taking orders for a share sale. instagram has launched a feature. the new feature allows you to broadcast videos and lets viewers watch only while it's streaming without the option of a replay. for more on the launch, our guest is with us. talk to us about how this works.
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>> well, when instagram added stories, that was a blatant copying of snapshot stories and everyone kind of like, you copied snapshot and instagram said, of course. and this is taking it a step beyond. now instagram has something that snapshot doesn't. and snapchat. emily: they have no choice. david, what is your take? >> it is interesting how many people instagram and snapchat and to see them dueling it out is interesting. wouldn't be surprised if snapchat copy this. emily: why doesn't snapchat have this? >> they prefer to have a
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experience that is live enough. for live stories, they bring out -- it's not like a mess of video that you get. it is more curated and still feels live. i think that would be a huge infrastructure expense and facebook has the support of live streaming of video. emily: david, you have interesting thoughts on a potential snapshot i.p.o. they have files to go public and have filed to go public earlier. but you think there are a lot of unknowns here. >> they haven't proven they are a growing profitable company. the more risk investors are taking on when they buy your shares. there is a massive appetite on wall street to identify the next fast growth tech company.
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uber is getting private valuations and people think they are getting into the back door. snapchat is probably as good as a guess you could make as to what the next company could be that could grow a lot and be a massive global success. it is by no means proven. has great management and they are doing smart things, but there is no way you could really know what snapchat's future has going to look at in my opinion. >> the big question around the i.p.o., is this more of a twitter or facebook. wall street is going to hope for it to be more of a facebook. is this a niche product that is going to hit a user growth like twitter has. emily: david, snap them chat has ignored the criticism over
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swaying the elections and -- ntially increasing building out the social walls of our bubble. >> they should hold their hats until they get that criticism. if they became the kind of company that investors want them to become, they will have to get into serving all kinds of other information, including political news and et cetera one way or another in a snapchatty fashion. i think that's interesting. it is hard for me to know. but i want to say, i thought sarah's point was smart that facebook has the infrastructure to be able to do this at a lot lower costs than snapchat. if instagram and snapchat are going head-to-head, the "big
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brother" advantages could be a major competitive advantage. emily: all right, david and my guest host for the hour. thanks for stopping by. and sarah, as always, wonderful to have you. a story that is trending, u.p.s. taps into artificial intelligence and developing apps to help customers to track packages using voice commands. they started the interact i have feature on skype earlier this month. and that does it for this aquigs of "bloomberg technology." check it out. that's all for today. ♪
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charlie: firsthand look into the mind of president obama as he reflects on his successor and the future of the united states. the piece is called "it happened here" which is out on

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