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tv   Best of Bloomberg Technology  Bloomberg  June 11, 2017 9:00am-10:01am EDT

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emily: i am emily chang. this is "best of bloomberg technology" where we bring you the best of weekend interviews and technology. our exclusive apple interview. his thoughts on president trump and how apple sees its role in aiding the fight against terror. plus our one-on-one withhewitt packet energy ceo from las vegas to give us a progress report on their turnaround in the age of the cloud. another bombshell at uber, the company fired over 20 employees
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after investigation into sexual harassment claims. first, to our lead, our exclusive interview with tim cook from the apple worldwide developers conference. the company set the stage for the hardware and software that will hit the stage in the next couple of months. this year, they introduced a update in mac books and a major overhaul of the apple watch operating system. the big answer is there product to combat the amazon eccho and google home. that's where i started with tim cook. take a listen. >> we tried to build something that is a breakthrough speaker first. music is in our dna dating back to itunes and ipod. we wanted something that sounded unbelievable. think when people listen to it, they will be shocked about the quality of the sound.
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of course, it does a variety of other things that are important as well. but we wanted a high quality audio experience as well. emily: you are very focused on how this could reimagine music in the home. is there a lot of other things you can do for it like call for a car or order groceries? >> there are a lot of things you an do with it. one of the advantages that we have is that there are a lot of things that siri knows how to do from the phone. so, we will start with a patch of those as you saw in the keynote. then you can bet that there is a nice follow-on activity there as well. emily: let's talk about e-commerce. they are very important to these devices. i can order paper towels on my echo. can you tell us about some of apple aspirations in detail? >> what i would read into it is
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that apple is a company concerned about music and wants to deliver a great audio experience in the home. we felt like we reinvented it in the portable player arena, and we feel we can reinvented in the home as well. we know people want a speaker to now do more than that. and, obviously, we want a speaker to do more than hat. so, you are combining what has been thought to be too distinctly different things from that. i think people are going to be kind of blown away with the experience. emily: how long have you been working on this? >> multiple years. the underlying technology in here is something to behold. to get the experience that we wanted at the quality that we
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wanted -- apple products, in general, take a number of years to do. starting from the core technology and building up to the product. emily: you have people out there saying finally. what took so long? >> for us, it is never about being first to anything. if you think back, we did not have the first mp3 player or smartphone or tablet. there was a tablet shipping a decade before, but very few people used it. arguably, we ship the first modern smartphone, mp3 player, the first modern tablet but we weren't first. for us, it is not about being first, it is about being the best. we want to give the user an experience that delights them every time. we do not let that impatience result in shipping something that is just not great.
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emily: it is the 10th anniversary of the iphone, and ou have unveiled the new ios-11. what is next? >> i can tell you that ios 11 is nbelievable. there are incredible things in it from peer-to-peer payments and more. it is the biggest ipad release ever and an area i have great personal excitement about. i am incredibly excited about a.r. you saw the demos done today. i think this is profound, and i think we today, as we get this developed and into the hands of developers, we are going to have the largest a.r. platform in the world. i think we have launched it in a large way to large numbers of people. i'm incredibly excited to see
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what developers will come up with in our a.r. kit. emily: more of our exclusive interview with tim cook coming up. how he says apple fights terrorist threats while protecting privacy. if you like bloomberg news, check us out on the radio. you can listen to us on the bloomberg radio app and in the americas on sirius xm. this is bloomberg. ♪
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emily: california is the home to tech giants that bring home millions in tax revenue and jobs to the state. governor jerry brown spoke with mckenzie am beijing. they can't rest on their lalls as pressure from china grows. >> the competitive game is getting more intense. america cannot rest on its laurels. they spend more time try to reduce taxes on the rich instead of generating more investment in both the private and public ector.
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that is kind of where i think washington is going right now. emily: now back to our exclusive interview with apple ceo tim cook. we moved on to politics. tim cook urged the president not to pull out of the paris climate accord but president trump decided dimply. differently. tim cook disagrees with him, saying that the global warming crisis requires worldwide cooperation. >> i think he did listen to me before making his decision, but i think he decided wrong. i think it is not in the best interest of the united states what he decided. the way that i look at this thing -- do you interact with politicians or do you not? on that, my view is, first and foremost, things are about can
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you help your country? if you can help your country and do that by interacting, then you do it. that country eclipses. politics. you have other people leaving the table though. is he damaging his relationship with the business community? >> i would differentiate leading a council and advising in a way that you think can help our country. i think the first one is a judgment call that people make. i did not join a council. it was not a decision i had to make, but i understand both sides of that. i think if it is helping america, that is a requirement s a ceo.
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ou definitely do that. if i get the chance to pitch the paris agreement again, then i will do it again, because i hink it is very important that we engage to fight climate change on a global basis. this is something that you cannot solve country by country, it requires a global action. emissions created by one country affect another. it is something we feel very strongly about, and it is something where i want to do everything we can do to show how important it was to stay in the agreements. unfortunately, he decided something different. emily: why didn't you join a council?
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>> two reasons, one is that my primary job is being the ceo of the company. i spent a bulk of my waking hours doing that, and i do so willingly because i love the company and the people in it. so, traveling back east is not something i look forward to doing except for when i need to. secondly, i do not find these councils and committees to be enerally productive. it was not about not wanting to dvise on something where i thought we could help or that we had a point of view that should be heard. i cannot imagine a situation where i would not do the latter, because i think it is in america's best interest to do that. i am first and foremost an american. emily: we then moved on to cybersecurity. u.k. authorities put more
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pressure on tech companies to prevent their products from being used by violent xtremists. apple has taken a stance on user privately in the past in their standoff against the fbi over the shooting in san bernardino, california. we spoke exclusively with tim cook about what the company is doing to combat terror threat while balancing privacy and security. >> these terrorist attacks, first of all, our hearts go out to everyone affected by them. they are horrendous. for us, we have been pretty much in the u.k. for the whole length of time for our company, and it feels like they are a neighbor. we have thousands of employees there.
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so, our heart goes out. what do we do as far as helping with this? one thing we have done since the beginning of the app store is that we curate the app store. we do not want hate speech on there or these recruiting tools on there. we have been very careful since the beginning about these things being on there. we may make some mistakes, but i do not know of anything getting through in that perspective. we are very vigilant on what happens from that point of view. also, we have been quite -- we have been cooperating with the u.k. government in not only law enforcement matters, but on some of the attacks and i cannot speak in detail about that, but in cases where we have
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information and they have gone rough the lawful process, we not just give it, but we do it very promptly. i would hope that they would say we have been cooperating well. i think it is some valuable information. i think there is in this understanding about -- encryption does not mean there is no information. ikely, meta-data exists. when you are putting together a profile, meta-data is very important. emily: is apple working to make encryption stronger? >> the reality is that these attacks on people and government -- these affect your safety and
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security. it is not just privacy. it is not privacy versus security. it is privacy and security versus security. we are always working to try and stay one step ahead of these hackers who, frankly speaking, have gone from the guy in the basement, a hobbyist, to a ophisticated enterprise. it takes all that we can do to do it, and we do not think our users should have to think through all this stuff. it is not practical for people thomas so we tried to stand up for users and stay one step -- not practical for people to think about all of this, so we tried to stay one step ahead of these hackers for them. emily: coming up, a surprising change at block. this is bloomberg.
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♪emily: now to a bloomberg scoop. the fallout of uber's sexual-harassment claims has led to the termination of ore than 20 employees. this investigation is being led by a former u.s. attorney. >> these are a variety of discrimination charges. of those, 20 or more have been fired. some are still ongoing and so there are more firings that could occur. some are senior executives. uber itself has to be very careful about facing further lawsuits from employees if they speak out against them. there is sensitivity about who they are. we have seen a lot of executives leave. some of them have left statements, but we are still
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watching. emily: what about the investigation of the former u.s. attorney general's handling? >> it is being very tightly held. we expect sometime next week to find out some public version of what they found. importantly, what he is recommending. there is the fact element where we will find out more about these incidents, that we will also find out holder's recommendation on what the company should do. mily: could more firings occur? >> it is not being rolled out. i think a lot of people expect top executives to be held accountable explicitly. it will be interesting to see what happens with the holder report. emily: in the meantime, there have been other executives who have left. >> yes, the head of finance eft.
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the head of growth left, and there was resignations on a result of the sexual-harassment allegations. there are a lot of top executives who left the company. emily: in the meantime, there have been two, key hires. both are women. tell us about them. >> there is the chief brand manager, and there is going to be the head of strategy. she's going to come in as the harvard business school guru who will come in and give them advice on how the company can turn the corner. emily: the invest conference kicked off in new york. scarlet fu asked him about one of his big shorts, tesla, and what would stop him from shorting it. >> i think it would have to be
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the company actually making money from its products. there was also solar city that he bought into, and that worked out better than tesla. this is a company that burns a lot of cash. they have not finished its giga-factory. the batteries are made by panasonic. the model 3 has been losing money for them. they hope to make money by selling a $35,000 car which we think will be a lot more than hat. you have the executive partner list, and the only one i have seen longer i think is valiant. people are leaving left, right, nd center.
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they are not waiting around to see the company's future. we will see. the production of the car is supposed to happen in july. i noted with some interest as i got here the opening remarks from mr. musk. talked about transforming into the energy company or something like that. he seems to be trying to position the company is something more than just a car company, but they are a car company. a money losing solar roof company subsidy. in addition, he is going to have to raise a lot of money. it takes 50 cents in capital for every dollar of automobile revenues. if he is going to be doing 500,000 model 3's and 100,000 of he model s and x's, then he is
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going to be something on the order of 30 some billion dollar in revenue, and he's going to need about another $10 billion in capital. he is going to need it soon. so, tesla fans should brace themselves as they will likely get a chance to buy more stock n the coming months. >> is it something in their story that the model 3 does not live up to the hype? >> he actually starts making money. in terms of your thesis becoming validated, would it be more of a sort of investor strike where conditions change in a market downturn? >> is the model 3 is not popular, then it is going to hurt. that is the one everyone is waiting for. the one that the average person who can't afford the s wants to be part of the revolution.
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if the car is a lemon that will e a problem. at the end of the day, he has to make a car for the masses that is successful. that is what we are going to watch. emily: crypto currencies get a new milestone that would have been unfathomable decades ago. when currency is now up tenfold in a year. getting that 12 digit threshold is largely due to bitcoin which is the largest digital currency. one company that is involved in this change is backed by vcs like steve ventures. we spoke with the ceo about what he sees as the driving force behind crypto currencies. >> i think we are seeing strong demand across a couple of key markets. we are also seeing levels of
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macro instability across the world which is driving a lot of growth. i think it would be a mistake on focusing too much on that instead of the huge innovation in the space across a variety of assets. >> when you say a huge surge of innovation, we going to see some instability? we have seen volatility when looking at the prices, is that going to stay? >> i think it is here to stay, because the price is going to move a lot. bitcoin is pretty established, and it does trade at a fairly low volatility. the other assets like some of the ico's you are seeing from the newer assets, i think those are going to remain very volatile until they mature and build market depth. >> can you talk about the trend
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of ico's? many of these companies are launching their own crypto currencies. what is the trend there that you are seeing at block chain in articular? >> i think it's better to think of these as tokens rather than initial coins. they represent some sort of value to these products. i think we are seeing both tech companies -- new tech companies but also established companies doing this. you see it across the tech space with both new and established products, and i think that is very interesting. emily: still ahead, another exclusive interview. this time with meg whitman, why she is looking at profit are
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just to improve in the fourth quarter. a reminder, all episodes of "bloomberg technology" are streaming on twitter. this is bloomberg.
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emily: welcome back to "the best of bloomberg technology." i am emily chang. the annual hpe discover conference took place this week, the company outline how it will continue to grow and stay competitive in the age of cloud computing. meg whitman joined us for exclusive interview from the discover conference in las vegas. meg: i think there are two very important messages, first as we is we believe the world is going to be hybrid. our objective is to make hybrid i.t. simple. what to do i mean by that? applications will be in the cloud and each customer has to find the right mix for them. a lot of customers are rethinking do they want to put
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as many applications in the cloud as they originally thought because for reasons of price and control, it may be better to keep it on prem. another big opportunity for customers is the edge, when you think about campus, grant, factory floors. the edge, everything other than your data center, is exploding in terms of the need to collect data, compute it, and store it. emily: there have been questions about margins, why is the environment so difficult now? meg: our margin in enterprise group, which is a major part of the company, was down a little bit in q2. the reason is we had stranded costs from our divestitures, we had done some acquisitions that will initially dilutive, significant commodity cost
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increases. we anticipate that margin will go back up to historic levels by q4. if we continue to grow our high-margin products, growth products like aruba, all flash storage arrays, our new server that is the most secure in the world, you will see nice financial performance from us as we finish the year. emily: what is the strategy to get costs down to help with the margin issue? meg: we have to -- we have a much smaller, much more focused company. i am probably the only ceo in america that enjoys running a smaller company rather than a bigger company because it's so much simpler. we have an overhead cost structure that we have to get down to be in line with the new company we run. we have to reengineer to make things simple. that is going to lead us i think to be able to take up more cost and be even more cost competitive in a very competitive market. volume servers, very competitive business. we need to have a more cost-effective structure there.
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emily: on that note, when we spoke last year, you said that dell was making a big mistake merging with emc. that said, hpe stock and growth has been under pressure. has any of that led you to consider if smaller is really smarter? meg: we are proud of our financial performance and stock performance since the split with hp inc. to hewlett-packard enterprise. if you think of the stock price of the company as a whole, which reached the low of $11.62, if you add up hp inc., hewlett-packard, our share of dxe, and our share of the software company, that is close between $48 and $50 a share. we have created a lot of shareholder value. our stock has done really well since we had split off from hp inc. almost 18 months ago. emily: when it comes to m&a, can dell play hardball better because they are private? meg: there are some advantages to being private, but actually because their debt is publicly
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traded, we have a window into dell's financials much in the same way as a financials public company. they don't get the scrutiny we do. we really like our hand. we have no debt on the company, in fact, we have $6 billion in net cash. we have gotten more strategic, more focused. we are smaller, and we are nimbler. we have dry powder to make acquisitions, investments. we can turn on a dime now, which is a different strategy from dell. they are getting bigger, we are getting smaller. we are deleveraging, and we are leaning into new technology. everything software defined and they are doubling down on old technology and a cost take-out play. it is a different strategy. i like our hand. emily: as you weigh whether to dime, when it comes to m&a, how reasonable are valuations right now? meg: they have become a lot more reasonable in the last six months. we have made an aquisition, almost one a month for the last six months. venture capital is getting a little tighter in silicon valley. the willingness to fund ongoing losses for indeterminate amounts
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of time, that appetite is shrinking a little bit. we bought nimble right, cloud cruiser right, and they are dead on to the strategy of making hybrid i.t. simple, powering the intelligent edge, the services we need to make it happen. we are feeling good about the opportunity to make reasonably priced acquisitions that fit our strategy. emily: what are the attractive targets? what are the areas of interest targets? on your radar? meg: first is the software defined data center. think about simplivity. that is more of a software company than and infrastructure company, but it's all about deploying applications easily in a hyper converged environment. we are very interested in software defined. nimble is software defined. it is all flash storage for entry-level and mid-tier. we are also interested in the edge. obviously aruba was incredible acquisition for us, growing 33% aruba, inless part of
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the last quarter. we are super excited about that. we bought a company that is basically a machine learning for security on the edge network. we continue to look at acquisitions at the edge. emily: you have spun off your enterprise services business, but you are still in services with point next. how does the service business evolve? meg: services will be an important part of our next. every company is trying to take their data center on a transformation journey from an older, brittle, high cost, not particularly flexible or agile environment, to a new environment that is essential for their competitiveness with their ability to win in the market. services, people need help on that journey. so, while we will not do ito, i.t. outsourcing, business process outsourcing, apps maintenance, we will do advise and transform, and that is what point next is. we think it is an important part of the business. the other part of our business is the ecosystem of partners.
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here at discover in las vegas we have the biggest presence of of partners, si's, isv's that we have had in many years. we have got a lot of folks that are anxious to do business with us because they don't view us as having an asset that is competitive to what they do. we are still very focused on the technology, but we have a whole bunch of players who are really interested in doing business with us now, and that is great. emily: there is always great fascination around what your future holds. how long do you plan to continue running things at hpe? meg: i love what i'm doing, i have to say, now being ahead of head of a smaller, more nimble, faster moving company makes this a lot of fun. i love what i am doing. i have more work to do. we still have another phase in our journey to make hpe everything it can be. i am here until my work is done.
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emily: what is that more work that you feel you have to do? meg: we now have to take this very focused company called hewlett-packard enterprise and we have to make sure we have a cost structure that allows us to compete in the marketplace. we still have a little too much overhead. we had overhead that oversaw a $110 billion company. we have to take more costs out of that. we have to redesign some of our systems. we have to redesign some of our processes to be more appropriate for a smaller, more nimble company. so we have some cost take-out to do, and we have a lot of innovation coming to market. i want to make sure that lands well, like our gen 10 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. emily: 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 our relationship with the president? meg: as you know, i was on the
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other side. as a lifelong republican, i endorsed hillary clinton. but once president trump won, i said to our employees, i wrote a note that said, president trump has won. has we need to give him the one, benefit of the doubt. so we are giving him the benefit of the doubt. but when we think there is something that is not in our best interest, 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 and others is an important thing for the united states of america. it doesn't impact our relationship. people can disagree. we happen to disagree on this particular issue. emily: tim cook also told me that he thinks the president decided wrong on paris, but plans to keep an open dialogue because he thinks it is important for america and for the company. what is your strategy? what are the number one things
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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 cash overseas at a much lower tax rate is important. we think 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 import a high degree of their goods. cost of goods sold and work on relatively low margins. the retailers, technology companies, we think that is not in our best interest, and by extension, in the best interest of the united states. we just make it clear where we stand on issues, very respectful, civil discussions. that is what this country was built on, the ability to disagree without being angry. emily: we will bring to you more more of that exclusive conversation with meg whitman next. the hpe ceo updates us on the partnership with microsoft. plus, authorities in the u.k. are calling for greater regulation of the internet following the recent terrorist attacks, but tech firms are
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pushing back. this is bloomberg. ♪
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emily: now back to our exclusive interview with meg whitman. she hit the stage at the annual hpe discover conference saying that hpe is seeing a slowdown in the public cloud. we asked whether businesses are really rethinking their move to the cloud and what that means for hpe going forward. take a listen. meg: the way we see the world, it is around hybrid i.t. you have to start with your apps and your data. what do you want locked down in your data center untouched by your employees' hands? what might you want in a private cloud with public economics, what do you want in a managed service? there is a role for public cloud , but we are seeing for reasons of cost, security, control, that people are beginning to say , i wonder if i have gone too far in putting workloads into the public cloud as then what to bring those workloads back to on
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premises. emily: what does that mean for hpe? meg: it means we have to do what is in our customer's best interest, and their interest is all around creating a multi-cloud environment, hybrid i.t. environment where they can have the right landing spot for their applications and their workloads. we make sure they don't end up with vendor lock-in. a lot of people say once you move something to the cloud it is difficult to move it back and very expensive. so we want to give customers choice and make sure we do what is best for them. emily: there have been questions about your cloud partnership with microsoft. how is that actually going? meg: it is really going well, we have done a lot of business with microsoft for many years. they are our public cloud partner. so when we work with a customer and they say, these are the workloads i would like to have in the public cloud, we say azur is a great opportunity. if you want azure cloud functionality on-prem, you do
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azure stack, which runs on hp gear. i think microsoft has a very good strategy, we are great partners with them. it's about giving customers choice. where do they want their workloads, where do they want their data? if they want a public cloud partner, we recommend azur. emily: if they start making their own data center equipment, what does that mean for hpe? meg: this is a dynamic industry. it is interesting. for a long time infrastructure was not in fashion, but we see all kinds of people getting into the infrastructure business. so if that is what microsoft does, we will try to figure out how to relationship around cooperation-competition. sometimes we cooperate, sometimes we compete. we admire the company a lot, we will figure it out. emily: tech stocks have been on a tear since the election despite political uncertainty. what are the market dynamics that you see helping or hurting hpe? meg: it's a challenging global environment right now. there are some countries doing
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very well and then there is uncertainty in a number of countries, and uncertainty is not good for business. our strongest market in europe is germany. germany is doing incredibly well. we are selling a lot of business in germany. but the u.k. is challenged, public sector spending is down, u.k. firms, people investing are holding back because of brexit. it doesn't mean they won't spend, but there is a pause. i don't know what is going to happen here, maybe i should take some time to think it through. japan is pretty strong for us right now, australia is coming back. latin america is doing very well. the u.s. continues to be a little uneven. one quarter is strong and then we see a little bit of weakness. so it is a mixed environment. listen, we have to make it work in every environment, so we sell as hard as we can and give customers as much choice, no matter what is going on in the backdrop. emily: you have led several high-profile technology companies. i'm curious what you think about the unicorn startups, what you see them doing well, what you see them doing poorly?
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meg: the startup scene in silicon valley and elsewhere is alive and well. it is a renaissance of innovation. think about what you are seeing. listen, there is a lot of very innovative companies that are unicorn valuations. what we are seeing is the ability of 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 was not clear they were going to be able to raise a next round and they needed to be tucked into a big company. nimble had a great fundraising round, but felt they needed to be tucked into a bigger company. we think there will always be unicorns, new companies, but we think it does present an opportunity for us as we think about our m&a strategy and our innovation strategy. emily: hpe is heavily investing in what you call the machine, or your vision for the future of
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computing. how will this help customers in the future and how is that vision evolving? meg: one of the big challenges our industry faces is the demand to build data centers, the demand for safe, and the demand for energy is unsustainable. we work in parts of the world where there is no more energy on the grid. that caused us a number of years ago to think through the fundamental model of compute. it has always been a cpu centric model. we said, can we turn that on its head and make it a memory-centric compute, instead of through copper wires data is moved, it is moving photonics , which would mean a smaller space with more energy efficiency. we are pleased with the progress of the machine. we are already embedding parts of the technology into our next generation server storage. we are super excited about the amount of data that can be processed with very low power utilization and in a small form factor. so it is right on track. it has had its ups and downs, as these big research projects do, but we are super excited about it.
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emily: our exclusive interview with hpe ceo meg whitman. coming up, u.k. authorities calling out the tech community after the attacks in london, saying the industry should do more to stop the threat of spread of terror online. we will discuss what could come next. this is bloomberg. ♪
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emily: social media platforms are under heavy scrutiny following the terror attacks in london. u.k. authorities went directly after the tech industry saying it needs to step up its work to fight terror. but tech firms say they are already police their platforms and are working to form a common database to more easily identify terror posts and flagged them for removal, so what should be done next? caroline hyde caught up with the institute of strategic dialogue's ceo in london. and in new york, paul quigley. >> we have been working to combat extremism of all varieties for over a decade now
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, both off-line and now more and more online, and we have done a lot of work with the internet companies also with the government on the issue. there is a challenge. we see terrorists, extremists, deploying incredibly professionally, slickly, if you like online. , and they got a head start. we have seen too little done to compete with that message of hatred online. we see too little professionalization of the civic , credible voices that can do a counter in that space. in many ways, this is where tech companies can be the most effective and support scaled professional, upscaled endeavors in this space. there is more they can do. they had admitted that is themselves. they have committed to setting up an industry body to drive not only counter speech in this space, which is really , really important, and education, because that is important, too, but also technological innovation.
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because there is more that can be done to identify and get rid of the most egregious content swiftly. the thing that we need to be worried about, always, is the overstepping of those lines. there is a lot of gray area content. very, very difficult to identify what in all cases should and should not come down. certainly that expertise does not sit with internet companies. i don't think anyone wants them to take on a full editorial role with regard to that content. caroline: where do you think the battle of the moment is between tech versus government? do you have a view on how the response has been does far? thus far? >> what we have seen is when these kind of problems have emerged before, the platforms have responded very quickly. the sharing of different forms of content online, quantifies that data very exactly. what we saw in the u.s. election, a large amount of fake or hyper partisan news spreading online. we saw much less in the french election and even less again in the run-up to the u.k.
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election. i think the tech companies don't want governments to come in, they will race in and try to solve the problems through technological means themselves before the laws get drafted. and hopefully, be successful in doing that. so i think that is the strategy that we will see deployed again here. >> the u.k. government and theresa may is talking tough on this, but i think the u.k. government would also prefer an industry- led solution. they have the best wherewithal to drive the technological response, no question about that. they are putting pressure on now to make sure internet companies follow through on the promises that they have made. but there is also something to be said for engaging, for letting certain types of accounts stay up online. we do a lot of work monitoring and identifying extremists prior to that law enforcement phase, prior to them crossing the
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threshold to terrorism. and there are ways in which we can engage further upstream, those sorts of individuals, and make a change. caroline: you cannot then target them. >> the issue is whether we drive them underground too far. there are constituencies that we want to be able to watch and ideally engage with successfully. those engagements have to be done very carefully and done by people who have an intimate knowledge and understanding of those issues. we work with former extremists who reach out to them online, credible voices from within communities, use peer-to-peer engagement. the internet companies have been very much behind those sort of activities. facebook as you know has launched a major initiative to support counter speech. so has google supported such initiatives and especially worked on digital literacy, digital citizenships. internet citizenships has been a major thing.
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how do we get young people understanding how quickly they can fall into the rabbit hole of extremist thoughts of communications online. caroline: paul, firstly, are you optimistic that we can see some sort of an internet, internally bred from the technology side of things, to help prevent this sort of spread of extremism online? >> i agree there will always be a gray zone. like twitter has taken the step of removing 300,000 some accounts. facebook has described it as a hostile zone for terrorism. facebook is doubling its moderators. there will always be the gray zone. at what point does supporting a political cause in the middle east bleed into expressing an extreme view? i think this discussion is not going to go away. >> which is why i would say this has to be a partnership between the private sector, between the tech companies, and civil society. ultimately, that is the private partnership needed to really
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respond to this challenge properly. emily: that was caroline hyde. a new report out by nielsen shows that ratings do not equal social engagement. the company conducted its first social media rating study that includes data from twitter and facebook to find what shows were getting the most attention. for example, "the walking dead" was by far the most viral show on social media, but was only the eighth watched a show on live television over the last tv season. trailing behind that show is "empire" and the abc "bachelor" franchise. that does it for the best of bloomberg technology. we will bring you the latest in tech throughout the week, including our coverage of the e3 conference in l.a. we will be hearing from the take two ceo. and nintendo of america's president. that is wednesday, 5:00 in new york, 2:00 p.m. in san
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francisco. remember all episodes are live streaming on twitter. check us out. that is all for now. this is bloomberg. ♪
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♪ david: what was it like when you came here? did people make crocodile dundee jokes? james: people would say to me, is it true that all australians wrestle crocodiles? i would say, well not all of them. david: wall street ceo's are thought to be people who throw things at walls, scream and yell. james: i think if you are the seventh of 12 children, you don't want to be the thrower. david: are you in favor of repealing dodd-frank? james: that is a terrifying but actually to start again, because what will replace it? the world doesn't want the large banks to be unregulated. david: you have been a ceo for seven years. that is pretty long. james: what are you telling me, david? [laughter] >> would you fix your tie, please? david: well, people wouldn't recognize me if my tie was fixed, but ok. just leave it this way. all right. ♪

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