tv Bloomberg Technology Bloomberg June 7, 2017 5:00pm-6:01pm EDT
president trump asked him to make it known he was not under investigation in his russia probe. comey will also say the president asked for his loyalty and that mr. trump said of the investigation into michael flynn "i hope you can let this go to testifying today, director of national intelligence dan coats declined to say whether trump pressured him on that russia investigation. said theington post" president asked him to intervene with then director james comey and michael flynn in the pressure pro. warning that syrian government allies will strike and american positions inside syria if it crosses any red lines. group madee military the threat one day after u.s. forces bombed forces there. they condemned the terror attack in tehran and are asking for perpetrators and financiers to
be brought to justice. the statement was drafted by japan on behalf of countries in asia pacific region, and was approved today by all 15 council members. global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. parenti, this is bloomberg. ♪ emily: i am emily chang. this is "bloomberg technology." one-on-one with meg whitman in a bloomberg exclusive. vegasins us live from las on maintaining profitability in the age of the cloud. one day before former fbi director james comey testifies before the senate, president trump tweets of the name of his potential successor. we will tell you more about
former doj official christopher wray. with hours to go before the u.k. general election, online voting is front and center. we break down the pros and cons. the annual hp discover conference is happening this week and the company has outlined how it will continue to grow and stay competitive in the age of cloud computing. meg whitmanard ceo joins us live a for a exclusive interview in las vegas. thank you so much for joining us. meg: happy to be here, emily. almost two years post split. what is your number one message to customers today as technology shifts beneath us? verythere are two important messages. first, we believe the world will be hybrid. we want to make hybrid i.t. simple. on and offs will be and in the cloud.
each customer has to find the right miss for them. they are rethinking, do they want to put as much effort and applications into the cloud as they thought? control, --of another big opportunity for customers is that the edge. factory think about floors, the edge, everything other than your data floor is exploding in that -- in terms of the need to collect data and store it. emily: there have been questions about margins in particular. why is the environment so difficult right now? meg: our margin in enterprise group, a major part of hewlett-packard enterprise, was down in q2. we had costs from the best stitures.-- dive we had significant increases. we anticipate it will go back to historic levels by q4.
if we continue to grow high-margin growth products, gen10, the most secure server in the world, you will see nice financial performance from us. emily: what is the strategy to get cost down to help with the margin issue? meg: we have to really -- we have a much smaller, much more focused company. ceo enjoying a smaller company rather than a bigger company. we have an overhead cost structure we have to get down to be more in line with the new company we run. we have to reengineer policies to make things simple. that will lead us to stake out more costs and be more cost competitive in a very competitive market. volume servers, a very competitive business. we need a more cost-effective cost structure there. emily: when we spoke of this time last year, you said dell
was making a big mistake i merging with emc. has been, hpe stock under pressure. has that led you to reconsider whether smaller is still smarter? no. we're really proud of our financial performance and stock price performance since the topped from hewlett-packard, hewlett-packard enterprise. when you think of the stock price of the company as a whole, which reached a low of $11.62 in the fall of 2012. if you add up hp ink, our share of dfc, and the software company, it isif you add up hp a share. a have done very -- $58 share. we have done very well. emily: can they play hard ball better because they are private? meg: there are advantages to being private.
is dell, because their debt publicly created, we have a window -- they do not get the scrutiny we do. we really like our hands. we have no debt on the company. we have about $6 billion of net cash on the company. we have gotten more strategic, focused. we are smaller, nimbler. we can turn on a dime now. it is a different strategy for dell. we are getting -- they are getting bigger, we are getting smaller. moree leaning into technology and they are doubling down on old technology. i like our hands. how reasonable are valuations right now? meg: they have become a lot more reasonable in the last six months. we made an acquisition of almost one a month for the last six months.
valuations are coming down because venture capital is getting tighter in silicon valley. losseslingness to fund for indeterminate time is shrinking. have cloudights, we cruiser rights. they are dead on to our strategy of making hybrid i.t. simple, empowering the edge, and the services we need to make it all happen. we are feeling good about the opportunity to make reasonably priced acquisitions that fit our strategy. emily: what are the attractive targets? what areas are of interest on your radar? meg: we are interested in a number of areas, but the first is the software decline data center. it is more a software company than a structure company. it is around deploying applications easily in a hyper converged environment. we are interested in software defined, all-flash storage. we are also interested in the edge.
aruba was an incredible acquisition for us, growing 33% in the last quarter. we are super excited about that. -- machine learning for security on the edge network. we continue to look for opportunities at the edge. emily: you spun off your enterprise services business, how does the services business evolve? an: services will be important part of our next. every company is trying to take their data center on a transformation journey from an older, brittle, high cost environments, to the new environment that is so essential for their competitive -- their ability to win in the market. services, people need help on that journey. why we will not do i.t. or app maintenance, we will revive and transform. we think it is an important part
of the business area the other part of our business is the echo system of partners. here i discover in las vegas we have the biggest presence of partners that we have had in many many years. a lot of folks are anxious to do business with us because they do not view us as having an asset that is competitive to what they do. we are still focused on technology but have a whole bunch of players interested in doing business with us now, and that is great. emily: there is only's great fascination around what your future holds. how long do you plan to continue running things that hpe? meg: i love what i am doing, i have to say. now being head of a smaller, company faster moving makes this a lot of fun. i love what i am doing and we still have a lot to do. journey tose in our make hpe everything it can be. i am here until my work is done. emily: what more work to feel
you have to do? we now have to take this very focused company called hewlett-packard enterprise and make sure we have a cost structure that allows us to compete in the marketplace. we still have a little too much overhead because we had an overhead that oversaw $110 billion company. we have to take more cost out of that. we have to redesign some of our systems, our processes, to be more appropriate for a smaller, more noble company. we have more cost take-out to do and a lot of innovation coming to market. i want that to land well, like our server, which is getting rave reviews at this show. it is the most secure server in the world, and everyone knows security is one of the big issues facing every i.t. department. you urged president trump not to pull out of the paris climate accord, along with other business leaders. hours later, he pulled out.
how does that impact your relationship with the president? as you know, i was on the other side. as a lifelong republican, i endorsed hillary clinton. said to our employees, i wrote a note which said, president trump has won, we need to give them the benefit of the doubt, so we are. is when we think there something not in our best interest or the country's best interest, i will speak out. i said, i thought we ought to stay in the paris climate accord. the next generation of industries around clean energy is important for the united states of america. it does not impact our relationship. people can disagree and we disagree on this issue. also told me he thought the president decided wrong on paris but planes to keep an open dialogue because he thinks it is important for america, the company. whatis your strategy and
are the number one things on your priority list when it comes to discussions with the white house? meg: we are in favor of tax reform. we think the ability to repatriate money overseas is important. a lower corporate tax rate would spur growth in the united states. on the other hand, we are not for the border adjustment tax. that is very difficult for companies that deport a lot of -- it is nots and in our best interest. by extension, in the best interests of the united states. to make it clear where we stand on issues, very respectful, civil discussion. that is what this country was built on, civil discourse and the ability to disagree without being angry. meg whitman, ceo of hewlett-packard enterprise live from the discover conference in las vegas. think you for joining us. of our conversation
emily: we have breaking news, and emailed statement from the president's personal attorney, responding to james comey's opening statement, preceding the remarks he will make tomorrow before the senate. he said trump feels vindicated openingat in comey's statement, he confirmed that the president was not personally under investigation by the fbi. personale president's
attorney saying trump feels vindicated. we will follow former fbi director james comey's critical testimony all day tomorrow on bloomberg television. on the eve of the highly anticipated congressional hearing of former fbi director james comey, his opening statements have been released. he says president trump asked him in february to put an end to an investigation into former national security adviser michael flynn. comey also states the president told him "i need loyalty," when they find alone in the white house, with regards to the investigation into russia. president trump will nominate christopher wray to run the agency. as investigations into russia theinue and -- is wray right man for the job? what do we know about christopher wray? >> he is a solid prosecutor.
many people in washington said he is the best guy on the list, we are happy about this. he has a history of bringing cases. he was at the justice department after 9/11, was involved in terrorism and other coverage at the time. he went on to oversee a task force. many other matters. he is an experienced prosecutor. emily: what do you expect his approach to be on issues like cybersecurity? the russian investigation? winnie: first up, he is not going to be overseeing the russian investigation. that is now run by a special counsel by robert mueller, former fbi director. who he worked with had justice. they know each other, they are not strangers. his double be to oversee the fbi. we do not know a lot about what his intent will be we look back at his 2003 testimony to congress on the patriot act and fighting terrorism. he was very supportive of the
patriot act. new, enhanced surveillance techniques and tools to put the fbi on a more even playing field. patriot act to get information from internet -- we doroviders to go not know how they will feel hackingcking cases or iphones. it will get into the limelight at some point. winnie o'kelley, thank you so much for joining us. our special coverage tomorrow of former fbi director james comey, testifying before the senate intelligence committee, on bloomberg television and rader -- radio. check out the seven-page opening statement, it is quite a read. ahead of the u.k. general election, online electronic voting. just how big is the risk of a
emily: as british citizens had to the polls to vote in the general election, the debate on how people vote, back in focus. a new poll in the u.k. reported 42% of adults who are not planning to vote in the june 8 general election will be more likely to cast their ballot if they could do it online. let's get the caroline hyde in london, with more. by a great am joined guest, out there helping count as many as -- election votes. let's speak to mike summit. this is already a company that .elps with electronic voting where are you already helping with this? mike: we are working on five continents around the world. we have counted 3.7 billion electronic votes.
the government of belgium, customers in estonia. we have done three nationwide elections in the philippines. we have just done a big project in armenia. literally, anywhere across the globe, any democracy. and the u.k. isn't operating online? why? we have to ask the u.k. government. i think it is a shame. if you look at the recent technology successes within government, it has been the success of the online voter registration pool. just last week, when the registration deadline closed, 622,000 people were registered to vote online. in one respect, we are doing something to enhance and make the registration process. it is a criminal shame we are not closing the loop and making voting easier. u k,eality is, in the election participation is dropping through the floor.
we can make voting more accessible by allowing online voting. caroline: talk about the challenges, concerns. there are concerns when it comes to fraud, privacy, cyberattacks. how are your technologies ensuring that will not be a concern? is important to stress that a lot of the things you read in the paper about state manipulations of elections and foreign intervention actually have not touched upon voting citizens. is thaton for that voting technology is particularly hard to hack. we deal in very specific additional security features, featuring and to end encryption -- end to end encryption. concerned about the privacy and security of these platforms and tools. we strongly protect those votes
so they cannot be hacked. caroline: nevertheless, we saw in france a pulling back from online voting, particularly because they were worried about cyber attacks. why did they do that if you have such a strong encryption? mike: it is important to stress, that is not a system we deployed. i think it was a knee-jerk reaction to this general climate of concern around cybersecurity. it gave them a chance to look at the system solution and make sure it was watertight. if you follow that story through to its conclusion, one of the challenges is the suppression of that online voting, there were who were of voters disenfranchised from being involved in the election process. without doubt, i think we will see that reinstated. caroline: if the u.k. government came knocking, a could be at the end of this week, what would you
there would not be an issue, such as the dnc hacking? mike: one of the advantages of technology in elections, you can introduce verifiability. it allows you to show that everything you say about the security solutions is operating correctly. it supports one of the key, fundamental principles of democracy, which is transparency. we have tools in the system that allow us to check right away through the casting process through the storage process, to prove it has not been manipulated. that is one of the advantages of online -- electronic systems over paper systems. caroline: mike summit, it has been wonderful having you. we will see how this election goes. he is already helping other
theresa may and jeremy corbyn made their final push for support before going to the polls. corbyn says he would be a leader for everyone, not just the elite. the flack has been raised at the nato headquarters in brussels, 29th the country became be member. today condemned the deadly twin attacks in iran saying the deprave and he of terrorism has no place in the world. nationst trump said that sponsor terror fall victim to the evil they promote. the death toll in the terror attack at the london bridge rose to eight today after a body was found in the thames river. the attackers used a van to run down pedestrians on the bridge saturday night. judges on brazil's top electoral
campaign.de -- the ruling could be an indication of which way the court is leaning. global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. i'm alisa parenti. this is bloomberg. inis just after 5:30 washington. we are joined by paul allen with a look at the markets. paul: futures are not looking much better than the weather, we are waiting on a trade allen's figures or april -- trade balance figures for april. ore price has been coming off, and that follows a week gdp
growth on wednesday. our first quarter gdp for japan expected to come in at .6% higher on quarter and improving to 2.4 percent. in may andalance china expected to rise almost 48 $38 billion,-- import growth slowing as well. there is a lot to watch around the region today. i am paul allen in sydney. more on "bloomberg technology," next. ♪ emily: this is a "bloomberg technology."
emily chang. earlier today meg whitman hit is seeingand says hpe a slowdown in the cloud. we are wondering whether businesses are rethinking their movement to the cloud and what this means tohpe meg: you have to start with absent data. what might you want in a private -- on premisesth . there is a world for public cloud, but we are seeing issues with cost, clarity control, and they want to bring those workloads back to on prem. emily: what does that mean for hpe. meg: we have to do what is in best interest.
they can have the right landing spot for their applications and workload, and make sure they don't end up with a vendor lock-ins. a lot of people say ones that you move things to the public cloud, it is very difficult to move back. we want to give our customers choice and do what is best for them. emily: there have been questions about your cloud partnership with microsoft. how is that going? meg: it is going well. they are our public cloud partner. when customers say these are the workloads we would like to have in the public cloud, and we say, if you want the cloud on prem, you want it as your staff, and as your stuff run it on cloud -- i think microsoft has a good strategy. it is about choice. if they want a public cloud, we
recommend it. if they start rethinking their choice to join the cloud, what does that mean for hpe? meg: for a long time infrastructure wasn't in fashion, but now we see a lot of people getting into the infrastructure business. that is what microsoft does. sometimes we walk rate, sometimes we compete. we will figure out how to work with them. emily: tech stocks have been on a tear despite the political uncertainty, what are the market dynamics you see helping or hurting hpe? meg: it is a challenging environment right now. there are countries doing well, and uncertainty in some countries. in europeest market is in germany. we are doing a lot of business
in your many. the u.k. berms and people investing in the u.k. are ofding back, i think because a brexit. it doesn't mean they won't spend, but there is pause. japan actually is pretty strong for us right now. australia is coming back. the u.s. is a little uneven. environment, but listen, we have to make it work in every environment, so we sell as hard as we can and try to give customers as much choice as possible. emily: you have led several technology companies, i am curious what you think about the unicorn startups, what you see them doing well versus what they are doing poorly. silicon valley is a renaissance of innovation, think
about what you are seeing. there are a lot of innovative companies. is the are seeing ability of the venture capital money to keep funding money-losing startups, we are starting to see a pullback there. one of the reasons we were able to buy simplivity, it wasn't clear if there were going to be able to brave the next round. great start off, but they felt like they needed to be tucked into a bigger company. we think it present an opportunity for us as we think about our m&a strategy. hpe is heavily investing and what you call the future of computing, how is that vision of all the -- vision evolving? meg: one of the big challenges is the demand for energy, it is
unsustainable. we work in parts of the world where there is no more energy on the grid. that caused us to seek the fundamental model of compute. can we turn that on its head and make it a memory centric compute? a smaller space, far more energy efficiency, and we are super pleased with the progress of the machine. we are embedding parts of the technology into our next generation servers and stora ge, and we are super excited with the amount of data that can be processed in a small form factor. it is right on track. emily: our exclusive interview , meg with hpe ceo whitman. the newest startup essential
added to its warchest as it plans to bake through in electronics, added $900 million to $1 billion. the first unveiled runucts, i high end smart -- a high end smart phone and and amazon echo like device. a new report by nielsen say that ratings do not engage social engagement -- do not equate to social engagement. was by farg dead" the most of viral show on social media, but was only the eight most watched show. trailing behind is the fox hit " bachelor"nd abc's " franchise.
emily: all the bet stock driving waymo is winning a battle against uber. thatistrate judge ruled they must hand over a document regarding what they knew about secrets. uber has refused to turn it over citing attorney-climate which. -- privilege. you will remember that it was alleged that anthony leven dow
$47 -- 47,000 documents. let's has been said about what exactly these companies are racing for, we are going to send it over to cory johnson for more. what are they racing for? 7 trillion dollar market. it is interesting stuff. groupsmith is the managing partner and sales from santa clara. this is a fascinating study with big ideas here. what is the big idea in all of this? howy: i think it is transformative this is going to
be. imagine a world where getting from place to place, transportation becomes in essence rate. it changes everything. it changes how you consume information, changes how you think about owning a vehicle. back, it makese the world a safer place. we have seen disruptions like this in the past. it is a huge opportunity or a huge threat for companies. cory: the adoption rates are an interesting prediction here. in 2050, talking about how you manage that overtime. the report hints at the evolution of it, i imagine you start at high-end vehicles and they get cheaper. yeah. i think you will see tens of millions of autonomous cars on the road, but they will be autonomous in the sense that
they are doing the driving, but you are still sitting there with this hearing wheel -- steering wheel. another five years from there, you will see an increase in cars that are fully autonomous. those cars think of more like a pod. well, they will take you place to place, you will get out, and it will pick up the next person or go to be charged. you will see an adoption curve that plays through, but i think you will start to see a lot of this in the next i did 10 years. cory: there was -- in the next five to 10 years. cory: there was an interesting been yet where a car was running out doing errands here to i was thinking of something like an telling it to get your dry cleaning later that day. it also spoke to car ownership
in the future, not just mobility of service. exactly. this is why it is important to think about this now. it disrupts so many industries, i think you will see three big impacts from this. first of all, transportation becomes almost free. the utilization goes up, they become electric. the way you think about going place to place or getting a good delivered to you changes dramatically. we give people a lot of productive time back, whether they use that for work, spent times with family. i think we can eliminate a lot of deaths on the roads caused by human error. it has fundamental implications on the worldwide economy. .ory: that is no small thing there is also a suggestion of a lot more time that people have to do stuff. i think about connectivity,
tablets, smartphones, whatever the devices are in 20 to 30 years from now, is that part of the notion there -- there will be so much more computing happening because people will have their feet up instead of hands on the steering wheel? stacy: exactly. inc. about a car that is -- think about a car that is a really powerful computer. abouterage person spends five hours a week in their vehicle, and britain it is more like 10 hours per week in the vehicle. that time moves to completely productive time. you can use it to work, connect, , and you'reices going to get some of that time back, because when you are in the autonomous world, the cars, grid, and traffic pattern become more efficient. it gives you time back and it's you time to use to enjoy
yourself or be productive. it is mind blowing. i have to ask you about the big news of the week, from apple, using faster chips. what does this mean for other pc companies seeing a retraction in their business? about thisave talked before. innovation is so good for us. when we see innovative companies that are introducing things people are hungry to go by, it is wonderful for them, wonderful for us. we are pleased to help them deliver this kind of technological innovation to the marketplace. i have to say and there new pro -- one of those things i wanted to go out and buy. that is exciting for us. cory: yes. it is amazing.
stacy, thank you so much. i will put this on my twitter as well, it was really exciting stuff. emily: all right. cory johnson, thank you so much. toshiba has reasserted its right to sell its chip is this -- chip business. the company wants to derail the fallin case the chip may into the hands of competitors. coming up, more news out of uber . we will bring you the latest developments of the internal investigation into sexual harassment next. a feature that i want to bring to your attention, our interactive tv function, find it .t bloomberg tv you can send our producers i message, play with the charts we bring you on air. bloomberg.sive to
plans to build another factory, because the current one is "bursting at the seams." that is according to elon musk. the model wide crossover could debut as early as 2018. more developments on it were now in a probe looking into the company's alleged workplace violations. of therg understands one investigations is said to include the rape and kidnapping of a woman i and uber driver in india. joining us is eric newberger, our correspondent. we learned that top
executives, ceo and chief business officer, and had been skeptical that the rape occurred and sort of propagated the conspiracy theory that a competitor might have planted it or sometime -- for some time. the driver continued to float the theory the rape hadn't occurred. it was something that was deeply troubling to employees at uber. you calle executives out specifically, what did they do? : he was a development guy, but he got the case file from uber's attorneys which included the detailed medical reports of this rate victim, -- rape v and he was fairly
cavalier in the way he treated the case file. emily: does he still work at the company? eric: no. he left soon after we started asking questions. emily: is this a result of the investigation, or of your reporting? eric: there is some mud in the water. it doesn't seem like he is one of the 20 people let go yesterday, but you have to remember the holder report is coming in. departurese further from the separate holder report rather than the investigation we saw tuesday. emily: what are we expecting to learn in this report? eric: we are hearing more that it is going to be recommendations and that the findings are going to be held tightly by the board. they are still seemingly working on the recommendations, but there will be some of how to fix this company that is in scandal
after scandal. emily: how is this affecting the internal culture of the company? i know you're on the phone a lot. what are people telling you? eric: i don't think this is helping the mood. i think people were optimistic about the purge of 20 employees that had sexual harassment retaliation -- complaint retaliation against them. i think there are a lot more questions about the company's culture. for employees that did know about it, certainly the new people, it will be troubling to them. emily: bank is a much for that update. and that does it -- thank you so much for the update. and that does it for this episode of "bloomberg technology." 5:00 p.m. eastern
announcer: from our studios in new york city, this is "charlie rose." we begin this evening with politics. former fbi director james comey will testify before the senate intelligence committee thursday. it is one of the most anticipated hearings in recent history. it marks his first public appearance since being fired by president trump last -- a central question is whether he believes that trump tried to interfere with an investigation. we work from -- look from a global perspective.