tv Bloomberg Technology Bloomberg June 14, 2017 11:00pm-12:01am EDT
alisa a check of your first word : news. steve scalise is wounded and in critical condition after a gunman opened fire as republicans practice for the annual congressional baseball game. a second congressman sustained minor injuries. the shooter was james hodgkinson from illinois. he was killed by capitol police. a gunman who opened fire at a ups in san francisco was an employee according to local police who say three employees were killed before the shooter killed himself. police say he was armed with an
assault pistol. president trump amended his travel ban to address arguments being made that it would expire today. the 90 day band won't start until court orders blocking it are lifted. it would suspend entry into the u.s. by people from six majority muslim nations. in london the death toll from the massive apartment tower fire is up to 12. authorities still expect it to rise. dozens were injured and several hospitalized. global news 24 hours a day powered by 2700 journalists and analysts in 120 countries. i alisa parenti. this is bloomberg. bloomberg technology is next. ♪
emily: i'm emily chang. this is bloomberg technology. coming up, the fed high -- that hikes rate. tim cook tells us they are pushing to cars and the competition is taking notice. first, to our lead. federal reserve chair janet yellen forged ahead with tightening monetary policy despite concerns over weak inflation. how will it impact the tech ecosystem, then sure, and how could that trickle down? joining us now, jeremy lou and the first the sea investor in snap.
fed officials raising rates, the third time in six months. how does this impact venture capital? flex micro always comes to macro. we are always looking at these early-stage companies. cost of capital are less important than do we believe in the team, do they have a unique insight, can they've built something that will create new habits for people? >> saw they raised with hundred billion dollars to invest in tech. there is so much capital built in the system, how does that change the landscape for you? >> it really is the latest stage companies that are going to be affected. those financings were almost a substitute for public offering. it is impossible for a company to put $100 billion to work. >> do you see an impact on
valuations longer-term? >> i don't think so. over the next few years, we have going to see fundamentals of the micro, and technology changes that create new disruptions. that is going to be a bigger impact than anything else. >> you were the first investor in snap. snap shares are near their lows. can they fend off competition? do you see innovation in the pipeline? >> one of the things snap has done a terrific job of has been to focus on its vision of being a camera company. additional functionality through the camera, outward looking lenses is something that
continues to push forward. the other thing is making it easier for companies to spend money on them. advertisers are finding more ways to spend money on them. those are two important factors. emily: there are user growth issues especially abroad. do you think they can re-accelerate? >> evan has been consistent talking about a focus on the developed world markets where the opportunities for advertising are the greatest. >> you and i last spoke when we were trying out snap spectacles. you were sharing your pair with them. they haven't really gained the traction some people expected. what are your thoughts? >> at the time evan characterized the spectacles as a toy. you should think about it in the
context of a camera company. it will make more experiments and tried to figure out different ways to engage with users. i think you're going to see more interesting product launches ahead. >> when it comes to other exciting consumer facing investments that is your focus. are you seeing opportunities out there? or is there a drought in terms of the pipeline? >> we believe consumer technology has become popular culture. the key driver is not the technology itself but the insight into behavior that can precipitate a new company. we are saying that disseminated not just from silicon valley but companies with those insights in
new york, los angeles, anywhere in between. i have been to illinois, to 10 is saying. one of the things we are excited about is the democratization of entrepreneurship. it is easier to build an app now. it is generating a new wave of interesting companies. >> life speed partnered with apple. why should viewers give this show a shot? >> one of the things that is compelling is that for this new generation if you are in tennessee and interested in building a nap you don't have a good view into the silicon valley ecosystem. what sort of questions you might be asked.
the last 20 minutes of each episode gives people a vehicle into what it is like to engage with a venture capital firm. we made investments in more than a dozen companies and it gives people an opportunity to watch what those conversations look like. where did we asked for questions for more information? where were we ok with the risk? for an entrepreneur trying to raise capital to realize the opportunity, it is going to give them a dry run as to what that is going to look like. >> can't wait to give it a watch. thank you for joining us. donald has announced his intent to nominate jessica to fill the democratic slot at the federal communications commission. she served until the end of 2016 when lawmakers failed to take up
her the nomination under president obama. the agency is working to reverse obama era regulations including the net neutrality rules. she put a significant focus on the plight of children without access to broadband service. coming up we had to e3, the biggest gaming event of the year. nintendo is revealing new consoles. our interview with the nintendo ceo is next. this is bloomberg. ♪
emily: a story we watching, harvard anniversary, university, stepping down. he has been a decade and was the first woman to lead the university. she's credited with leading a capital campaign that raised over $8 million, but her tenure was marked by financial difficulties. she discussed her vision to bring the university into the future. >> if you're going to be a citizen of the 21st entry, you need to understand technology. we have tried to cast an open gate. in the past sign, studies challenge people by saying if you are not going to be einstein you double long here. we have a completely opposite attitude, which is try this out. we want to give you a path to succeeding.
>> to the biggest videogame conference of the year. e3 is underway. among the biggest announcements, the xbox one asked. and nintendo in particular stirring up serious competition unveiling pokemon and metro ride. then has risen 40%. joining us now, reggie, great to have you. when are these new games coming? >> we've got a great lineup of new games coming. a brand-new franchise, we are going to be hosting a tournament here at our booth. the highlight is a new super mod it -- super mario game.
consumers have big smiles on their faces. things are going well for us. >> should we expect other games to be announced later this year? >> we announced here a number of different games for nintendo switch. we have a new game coming out this summer. there is a franchise we have announced a new addition coming later on this fall. we've announced well in development a new metro game. we have a wealth of games. plus great third-party games from ea and bethesda, a lot of content coming not only for nintendo switch, but nintendo three dead -- nintendo three ds as well. it's interesting, our competitors believe it is all about processing power. nintendo believes in fun. our content bring smiles.
our content focuses on a fun and enjoyable experience. for us the technology is a small part of what we deliver. we deliver smiles and fun. >> mobile gaming continues to be a big growth driver. what are the lessons you have learned? >> super mario on the iphone and android, we are selling this application and games that have never been able to enjoy nintendo content before. all of these markets are enjoying this application. mario is reaching new types of consumers.
we launched the game doing exceptionally well, how to bring our content to smart devices effectively, that bodes well for our future efforts including our next application. emily: pull ceo tim cook visited japan last year. how did that go? >> it went incredibly well. as we were doing the planning for super mario run, we had our key game developer there. what we have been able to foster is a strong relationship with apple, with google and android as well. we offer these marketplaces a type of content that consumers love, that consumers have fond
memories of. that is important to them. >> when can we expect mobile games to be a majority of nintendo's revenue? >> great question. today the vast majority of revenue is driven by our dedicated games business. mobile is one of two other key platforms as we think about our growth. the relationship we are doing with other companies like universal studios is going to be important to us. i would say what we are doing with the licensed merchandise area, these are all of the different areas nintendo is going to drive revenue and profitability into the future. emily: you have more than $8 million on your balance sheet.
do you plan to use it on m&a? >> it depends on the opportunity and how we can do something that would add value to the business. we have been a highly profitable company. we are not eager to make any type of mood. to the extent it can help us drive our strategic focus areas there is the possibility. emily: what about virtual reality? how bullish are you? >> here is what is interesting. i would say the amount of content this year is dramatically down. we have said all along that virtual-reality needs to be fun and social. it hasn't and able to do either of those things yet. we think augmented reality is potentially a more interesting space.
pokemon go and what that did in the augmented reality space was important to our company. we are continuing to look at these technologies. in the realm of virtual-reality we are continuing to evaluate whether or not this is going to be an important trend for the consumer. emily: ok. and you as always for stopping by. coming now, one of the biggest unicorns in europe going after uber. we will hear from the founder next. and you can find our new interactive function. if you miss interview go back to it, since our producers a message, play along with the charts. this is bloomberg subscribers only. this is bloomberg. ♪
emily: a story we're watching, wind and solar energy accounted for 10% of energy marking a new record level. wind farms accounted for 8% of electricity generation of residential and commercial installations made up the other 2%. after the president of the u.s. out of the paris climate accords, tech companies pledged to move forward with their commitments to reduce carbon and push for renewable energy. in france, carter sharing has been expanding to let more drivers split the cost of long distance trips with passengers. now it is trying to do short distance trips. live from london with more. >> i spoke to the blablacar founder.
>> it depends on the countries that we see some growing super fast. we have a community in 20 countries. some countries are incredible in terms of growth. russia is becoming the country in which you have the most people carpooling. it is incredible to see it becoming democratized. >> put that in perspective for us. >> that represents 12 million people traveling every quarter. to give you a sense of scale, we actually have more people traveling then british airways. >> as you scale, and countries like russia continuing to pick up pace, it is ridesharing over
long distances you might usually take a train. you are adapting that model. >> you are successful and doesn't mean you should not explore new initiatives and make innovations and try experimentation. this year we have tried to things already which, we provide our members a way to acquire a car in a losing mode for an attractive price. we have lots of people who buy cars every year. we were able to have a deal, which is very interesting for our members. you can lease a car and get a super good price because you are a member. it is reserved for the ambassadors. caroline: and that is international? >> it is in france. we will extend it when it is successful.
we launched a new product, for shorter distances. commute trips you do in the morning and at night to go to work. the goal is to get more frequency, on a daily basis. >> talked was us about the taxing and france. technology week. very much trying to sing up the praises of a particular hub but what is it like in paris? >> next year we should synchronize. having the london tech week and the tech week in france with lots of seasons right now is not very convenient for europeans will we travel everywhere. we have to travel during the same week and it is complicated for a lot of people. >> note to organizers. we need to synchronize and have one london tech week or the reverse.
maybe different in france. so, it is a booming system. >> you have a new leader. a new party. assuming lee a legislator that will be on his side. do you think that will make things better or does it not matter what the environment is like? >> it is early to tell. we have been able to vote for change and vote for a young president. this is sending a message we're ready for the next decade to change things and make them better. >> optimistic there. emily: thank you. coming up, wrong moves as our next guest on the uber ceo taking a leave of absence from the company he cofounded.
show me unicorns. [ voice remote click ] together: ahhh... that works too. find your awesome with the xfinity x1 voice remote. see despicable me 3 in cinemas in june. >> let's get you up to date on the news we are following at this hour. qatar is said to be buying of warplanes even as it is isolated by its neighbors and criticized by donald trump. valued at just over $20 billion here. i ran host headquarters with
about 11,000 military personnel. linkedn has found itself with foreign activities. fund says itt that will contribute $10 billion. >> german chancellor angela merkel says she expects the u.k. to stick to its brexit timetable even as your finance minister and the french president said that his door would remain open. she declined to comment on the possibility of a brexit u-turn following the general election saying she would not speculate upon any subject, especially upon it brexit happens or not p global news 24 hours a day powered by more than 2700 journalists and analysts in more 100 20 countries.
you're looking at tuneup of them right here. >> we have weakness across the region. bonds rallying on questions about inflation. oil trading at the lowest since november dragging on regional energy and mining stock across opening market, sending stocks in sydney and so lower. following the fed rate hike, there were questions of if the pboc will similarly move, but there is a sense that they are not opting for that as we see china bonds fall, but given the efforts of the campaign ,eemingly finding some success that is a gift to rise.
we have some bright spots in the market. against the most kiwi dollar on the surprise jobs ag -- gdp miss in new zealand is dragging on the kiwi. emily: this is bloomberg technology. after worst selloff for tech stocks the market is trying to find its footing. the companies that solve the biggest losses fell once again after the federal reserve meeting but after the $176 billion wipeout we have seen since friday, our tech stocks too expensive? i want to bring in james,, who covers these stories. >> i don't think you can make the argument right now. they are more expensive than valuations we have seen but the growth rates we are seeing are superior to the growth rates we
have seen previously. you can't make the argument that the valuations are justified. if you look at facebook and google they are 10% higher. >> what is behind the sellout? >> we are seeing more -- i do think as you look foreword, you do have the potential for a broader market selloff. a lot of the estimates was with the trump trade, these bills passing through. we are delay after delay. what happens to the estimates? emily: you see more bombs in the road ahead for tech stocks. >> if you have a long enough
horizon, i think it is justified now. right now i'm neutral on a lot of these names. amazon and facebook specifically. google is the only when we see where the risk reward trade-off makes easy sense. the valuation is cheap. you are growing revenue around 20% like clockwork with these new opportunities. >> you put out a note on over, he has since resigned. you have taken -- he has taken a leave of absence. what is your reaction? >> in fairness, i did caveat i could be wrong on this. the way -- the reason we thought he would stay, they were able to hire top lieutenants even with him there. that was a positive. the business from what we saw is doing extremely well even with
these hiccups -- that is an understatement. emily: pretty big pickups. >> mountains that they are trying to climb over. at the end of the day the business was doing well. the case can be made that if business will continue to do well, i think he might lose some leverage. i can tell you employees are probably more inclined to think that he will come back. >> what are the chances that he returns? >> i'm campaigning against him coming back. from what i hear. the sentiment -- [indiscernible] emily: the eric holder report was being read out to employees. he made an off-color remark along the lines of women talk
more at board meetings, which studies show is not true. he has resigned. how much hope you have if these issues are coming from the top down like this? that the culture at boop can be improved. >> the good news is from what i hear, this is the first time employees have started to feel better about the prospects from the commentary hr has been making. at the same time you can see this is not a travis specific issue. this is a fundamental issue across all levels of the company. i think there is hope. everyone can change. as long as you address it and identify at, why can't they improve?
>> you are a about the future of uber's business with or without him. do you see uber sustaining that valuation? >> right now it could take a hit in the near term. even though we putting this behind us, there's a lot of headline risk associated with it. they don't even have leadership in place and you have massive employment attrition. emily: all right. always great to have you here on the show. thank you for stopping by. apple joins the race in a time as cars. this is bloomberg. ♪
as an ad. the product is being tested with a handful of businesses and celebrities and will be rolled out more widely if it is successful. back to our coverage of e3. well movie and tv studios continue to be disrupted by digital entertainment, videogame companies have come through looking like winners. if you look in the bloomberg investors are bidding up on these stocks on prospects for rising profit. we caught up with the ceo and asked what is driving stocks? >> there are a couple of things driving the growth. the first is the promise of the business is beginning to be translated into the reality of
how these companies are doing. the promise has been interactive entertainment is the most rapidly growing part of the entertainment's nest. with a cohort of consumers it is 37 years old on average, only skewing slightly more male than female. we have the explosion of new gen platforms. we expect that to nearly double in the next few years. the launch of nintendo switch. and the ongoing engagement of consumers in between big releases. consumers are only buying big video games now. they are staying engaged in the products they love. we are able to monetize that engagement. emily: some of the biggest announcements, microsoft's new powerful console, the playstation 4, how are you positioning yourself for these announcement? >> the machines are backward compatible.
they are effective for titles that are tailored for them. they are also playable for titles already in the market. every time there is more technical rim for our creative artist to express themselves they are excited by that and weep it ourselves and making the most immersive quality experiences in the business. having a more exciting and deeper canvas to paint is always good news for us. emily: big news was the delay of red dead redemption 2. what is the reason for that? >> we are always trying to put out the highest quality titles. while it is difficult to slip a title, when our teams feel more time is required to deliver the best possible experience, that is the decision that is made.
it has paid off for us over and over again. we are in the business of delivering the highest quality titles to the market. emily: there's a chance ea is going to bring back nba live this year. how concerned are you about renewed competition? >> we are always looking over our shoulder. we don't take anything for granted. i'm fond of saying that arrogance is the enemy of continued success. our nba title is the highest rated sports title of new generation consoles. we are really proud of that. we have sold nearly 8 million units of the title. our recurrent consumer spending is up 70% year over year. there's a lot to be proud of. there's a lot more we can do. we believe the title that is coming up this fall is going to be nothing short of extraordinary. emily: you and i have talked about the prospects of virtual reality and you have taken a
wait and see approach. what are the biggest challenges that you see that remain to virtual-reality going mainstream? >> i think i'm an outlier in expressing some concerns about whether virtual-reality would be an appropriate market for the entertainment business. it is there he exciting technology for military uses, for health care. for entertainment there is some challenges. the market is still small for us and our competitors. if there is a market, if consumers want the our experiences we stand ready and have the technical abilities to bring those titles to the market. i am skeptical. emily: why are you skeptical? >> there are any number of
issues with regard to what is currently the vr experience. the fact that the experience is solitary, it can create discomfort. nausea. there are all kinds of problems associated that make it somewhat inconsistent with the way people consume entertainment and interact with entertainment. emily: here is the chart on the bloomberg i mentioned earlier. take to outperforming the broader market. activision and blue. videogame stocks in general on the rise over the last year. a quick programming note. this thursday, cisco chair john chambers will join daybreak america in paris for an exclusive interview. this is bloomberg. ♪
emily: automakers are seeking permission to put more experimental self driving cars on the road to speed up development. car companies are asking congress to expand the cap on how many cars can be deployed under waivers them safety regulators according to the alliance of automobile manufacturers. they were asking congress to clarify statements of roles and regulations that implicitly require a human driver. speaking of self driving cars, after years of toiling away in secret, tim cook elaborated on the company's plans in the automotive market in our exclusive interview.
>> a thanh amis is something that is incredibly exciting for us. we will see where it takes us. we are not saying from a product been to view what we will do. but we are paying straightforward that it is a core technology that we view is very important. emily: our interview with tim cook spurred analysis. others are taking notice. carl joins us now, the parent company of the kelley blue book and auto trader. thank you for joining us. the most detailed yet, but still high level. somewhat vague. >> eventually it could lead to the apple car that we have been thinking about in hearing for five years different rumors.
in the near term it will lead to collaboration between apple and current carmakers similar to what waymo is already doing. you could see a world where just like our phones are androids or apple phones, we could have a circumstance where our cars, technology are powered by apple or google-based technology and operating systems. >> as apple potentially goes to market do you see them partnering with a manufacturer or more likely coming to market with a car of its own? >> probably all three in sequence. i think they will partner with an automaker and start to make them power their own baton of his vehicle systems and eventually they could become a final producer of car designs that the automakers make for
them, making the automakers a tier one supplier for apple. emily: there are two mobile operating systems that are dominant. do you see the same for cars or more? >> that is a great question. we could end up with more initially. we could end up with somewhere between five and 10 at the initial stages. it would get down to two or three, like our phones are now. that is likely what we will see in the next 10 years. emily: apple is far behind when it comes to cars. this is something google has been working on for a long time. can apple catch up? >> i think they can. it is not a hardware situation or an automaker were you have all of these suppliers. if you have the brain trust and
the focus you can get there quickly. you have to be careful how you do it. you don't want to take information from other companies. players are claiming that what -- that is what happened to them. they have changed direction on how they want to execute it but i don't feel like they are starting from ground zero at all. they have a lot under their belt. >> tim cook mentioned his excitement around electric cars. he doubled down when he heard these comments from tim cook saying tesla has a lot of competition ahead. do you agree? >> i do. there are plenty of well-funded long-standing players on the tech side, on the automotive production side, and tesla is a newcomer.
they are trying to figure out how to have long-term funding that is sustainable. they've got plenty of challenges that go beyond developing a self driving car. someone like apple can focus on this. they've already got their current business model in place. emily: tesla already has cars on the road. apple has nothing as far as we know. >> but tesla has done that in an unsustainable way financially. at some point they have to make enough cars to be profitable. until then they can make a lot of claims but nothing looks sustainable. a lot of what they have got accomplished other players can do as much or more. they are just as capable as tesla is. emily: what about a company like gm? what does it mean for a more established automaker trying to take on these tech giants?
>> that is a great move for general motors. ultimately you need the three major elements of this to work. you need the car with a lot of internal space. you'd need the technology that directs the car when there is no human involve. gm has the car and a lot of the work on the technology. they can partner to get the rest of the way. the third like is the regulations and the government helping it all come together. that one is harder to predict. if those three things come together things will happen quickly. gm is a long way along the race in this to get to the car. they have a lot of things moving in the right direction. emily: tim cook got the auto industry talking. thank you so much for joining us. that does it for this edition of