tv Bloomberg Technology Bloomberg October 5, 2017 5:00pm-6:00pm EDT
issue to congress for a 60 day review. police in las vegas say mass shooter stephen paddock did not plan on killing himself wallowing his deadly rampage. investigators -- following his deadly rampage. 58 people were killed and hundreds were wounded. the nra says the bump stock should be subject to additional regulations. the nra says officials should review whether the devices comply with federal law. the district of columbia decided not to appeal a ruling regarding their gun laws. that was ruled unconstitutional. sessions isy jeff creating a crime-fighting strategy.
it sends certain gun crimes to court where they could carry longer prison sentences created -- as in sentences. sentences. this is bloomberg. ♪ emily: this is "bloomberg technology." 'sw the e-commerce king experiment with a new service that could affect some major partners. we will look at the timeline to a national expansion. raises thece hike price by 10% to finance its push to own content. it tv andans for
movie budget. the pac-12 is about to get more air time in china. we will break down my alibaba made a deal to stream u.s. college sports. amazon is one step closer to reading it soft -- itself off delivery services. it will make more products available for free today delivery. two day delivery. shares of ups didn't as much as 2.1% after the announcement. fedex was down but recovered slightly. amazon began using the service earlier in india and the west coast of the u.s. earlier this year on a trial basis. , is ourme to discuss
editor at large in new york. spencer, i will start with you. how is it different from the way amazon works right now? isthe biggest shift here amazon has traditionally built this vast network of warehouses and encouraged merchants to send their inventory into that network. amazon would centralize that in whatwn delivery system and they are experimenting with now is rather than bringing inventory in, they want to go to the facilities and handle delivery directly from those facilities. it is bypassing that step and effortsamazon logistic outside and beyond its own delivery system. emily: what does this mean for the bottom line? at what cost will this come to amazon? >> it might be the opposite.
workforce andion stripping those people of the potential for this work, they might save as much as 30% or more on the shipping cost. they have done a lot of work on this. this will go from a massive center to a potential profit center. theyu look at the losses have racked up over the last few years with shipping, they are substantial. the most recent year they lost $7.2 billion in just 12 months in shipping. that is the net loss. that is cost of shipping after getting paid for shipping. even more disconcerting is the percentage of revenue. that number got a little worse in 2016. a little more than 5% of sales. on a percentage basis, that is one of the things you look at. not much -- how much they are giving up in terms of shipping
costs. evenat number would break or be profitable, it really changes the income statement for amazon. they can do what they always do at similar prices or start to have a little bit better looking business. ,reatly at the expense of ups coming from amazon.com and at fedex, which is about 3% of its revenue coming from amazon.com. emily: spencer, what do we know? ups will haveand some kind of relationship with amazon, but down the line for that become no relationship with -- could that become no relationship with amazon? that the ceo is thinking in terms of decades and not just tomorrow, how much of this business -- the holiday shopping season, the partnership
that has always existed between amazon and ups and fedex will continue to exist. , howis continues to evolve much of that partnership is diminished? >> if you think about what amazon did with having these 30 -- third party suppliers, they helped amazon have more stuff to sell when they did not have enough. it helped amazon have more computing power than they did not have enough. this could allow them to have more shipping power when they need it. to sell thatable to other companies and other merchants when they do not need it. it is about charging customers or wholesalers when they are not using it. emily: busy holiday shopping season coming up. this is a time where amazon has had difficulties in the past.
do we know the plans are for this holiday shopping season? >> this is an example how they can eu the logjam -- ease the logjam. they are expanding it every year. the biltmore facilities every year, but they still create a whenm during peak season everybody is rushing and more packages need to get to their facilities. this is a pressure relief valve. if they cannot drive that inventory through their own facilities, if they could go to quickly from their merchant partner to the customer, it takes pressure off their facilities and lower cost with a better bottom line. large, coryditor at johnson in new york, thank you both for joining. the usa.ave breached
that is according to the wall street journal. hackers working for the kremlin contractor whosa removed highly classified material and put it on his home computer. it were able to do so because -- it was notd discovered until spring of last year. the nsa and kremlin have inclined to comment. up next week continue our coverage. we talked to the ceo of bach, aimed to disrupt the delivery game. this is bloomberg. ♪
license wase the revoked in london, sales were rising in the region. rose. revenue it was a 59% jump from the previous fiscal year. they continue to operate in london while they seek an appeal to the stripping of their license to operate there. we just covered amazon stepping up its logistical operation. who can go up against the tech giant? just focusing on bulk items is taking aim at amazon. amazon is the elephant in your
room. what does this mean for you? it is a ballroom. it can fit everyone. emily: what is this change, the fact that they are taking on even more their delivery services, mean for you? >> these days, if you do anything online, you have to control as much of the value change as you can. that is what we are doing. writing our own software and building our own autonomous guided vehicles to make it even more efficient. these are the things that retailers need to do today in order to truly compete. we sell a different assortment been amazon. we only sell big items area -- big items. we sell food online. we have to be as efficient as possible. we are looking at your
in-house robots. these are powered by tesla batteries. amazon has robots in their lower house -- warehouses as well. is customized for our business. we so close to 10 items per order. a lot of the robots you see in amazon facilities, they are not able to handle those orders well. if you have 10 robots backed up for every pack table, it becomes difficult. these robots go along like a train and favored only when they need something on a given talent -- pallet area and -- pallet. this is our first array -- foray. emily: what is the next step? >> one day we will be so that i will not even have a job. really seeing how
efficient these robots can be for us. even betterd battery suppliers. the battery supply of these robots, we use tesla batteries right now. we are pursuing other potential partnerships that can give us even look -- longer charge cycles. emily: i am imagining what it would be like to interview boxed robot ceo. in there for everyone. there is the question about whether that is true. these delivery issues are the only thing that stands between jeff bezos and dominates in -- domination. could that happen for you? >> absolutely. when you look at the evolution of retail, there has been very
dominant retailers. people who have built their own inhes, and are successful focusing on a particular business consumer or business set have become very successful. even in the off-line world, costco versus walmart. a fortune one company. cosco is not as big but has built a very strong business in the shadow of walmart. in the online world we have to stay focused. i think we'll be all right. emily: tell us a little bit about how fast your business is growing. you have confidence you can take on amazon. >> are not sure we have to take on amazon to be successful. -- i am not sure we have to take on amazon to be successful. garage about four years ago to now, during that stretch,
from $70,000 in sales to crossing the million-dollar threshold. to go from that's where we are today, including the automation you see, it has been the ride of a lifetime. more has been so much revenue and growth to be had. we sell snacks, toilet paper, and that all americans used on a daily basis. when you look at the history of retail, there is never been a single retailer that captures 90% share of food or everyday consumables. emily: we hope to have you back in five years or so when you have been replaced by a robot. thank you so much. boeing is expanding into autonomous aircraft with the exact -- their newest
among the list of products, two new versions of its pixel smartphone, a laptop, and a smaller model of its home speaker. >> we wanted to make products that were radically helpful for users. a lot of them showcase our technology, things that combine to create thee ultimate google experience. he saw things that are real and othereveryday use things that appeal strongly to other kinds of users. we wanted to do a broad range of things to show the full range of innovation we can do. >> talk to me about what users and markets are trying to reach now. the home speakers are still really new. it is mostly people in the silicon valley and the coast. >> it is definitely an early market. we are very excited.
what we were doing is trying to think about how people use these in their home. it is a great product for small rooms, your bedroom. if you have an entertainment area, we wanted to create google home max which has a powerful sound. simple for an easy user experience. that is why we created this whole family. >> there were 2000 engineers with a pretty big price time. is it just for the pixel? >> these are the people that have been working on the pixel with us. super talented group of people who have come up with a dip -- a bunch of different innovations. we worked with them a long time as part of google. we are excited to bring them on board. we are thrilled to have them.
they are obviously very skilled in the smartphone domain. >> a lot of people said this was an echo of motorola. is it the same? >> it is very different from motorola. a couple key things are we are acquiring part of the team, and that team is critical to something we are focused on, which is the pixel phone. we are not acquiring the rest of the operating business. to operate asinue they are. we are really focused on that smartphone segment area it is a little different than motorola. they will be part of the mainstream company as well. smartphones,t just you had a vr announcement today. showcase of what we can do and how far we come -- have come. google clips is a small camera
you can place anywhere. it has a wonderful little clip and take these moments are you can be in the picture. you set the camera down and it will automatically take photos. it will discard things that might not be good, the picture is blurry or not in focus. because of the machine learning capabilities we have added to this little device that used to take massive computing power to run. you made it run on a small electronics processor. it is perfect for parents and pet owners because we have trained it to focus on people that you are close to. the compatibility will expand in the future. .> talk to me about that it has been a year since he launched the first hardware. how is it changed the relationship with android partners? >> i do not think so.
it is something that google has been doing for many years with the nexus program. we are after the cutting edge of technology. we have to invest a lot of money hardwareemium tier and and integrate them together. we have a very focused approach to bring people the best google experience. more importantly, we have a wide portfolio that looks at a number of different areas. it is not all focused on the smartphone. we have a new chrome book called the pixel book and the speaker family. there are a lot of efforts we are doing. >> the speaker is a natural competitor with amazon. -- you setting your strategy? how do they look different than amazon? >> for how people use them. we have a range of products that
has a small device that might fit in a small room. we have a middle sized device that might fit in a kitchen. we have a very large google home max device that has our latest and greatest technology to fill a very large room or outdoor space. are.is how a lot of people wayhink that is the right to prosecute our business. it is just how users are likely to use them. >> are you ready for next year? >> we are getting ready for next year. you will have to stay tuned for 12 months or so until that time comes. emily: googles senior vice president there. prices astflix raises it tries to fund its ambitious content strategies.
turn so my automatic rifles into fully automated weapons should be subject to additional regulations. officials should review whether the devices can apply with federal law -- comply with federal law. senior congressional republicans are open to discussing considering legislation banning those devices. the house democrats leader nancy pelosi says the massacre gives gun-control legislation more urgency. >> we must act. it is a daily tragedy. it is a mass tragedy. there is an episode where for more people are killed. investigators trying to determine a motive behind the massacre are looking into scoped out gunman
bigger music festivals in las vegas and chicago. authorities say he booked rooms overlooking the lollapalooza festival in late september. democratic members of congress held a rally outside the capital for immigrants living in the country illegally to submit their application to stay in the ..s. under the daca program president trump wants to end the program and has called on congress to come up with a law to protect them. many tumors have yet to turn in their paperwork. it is just after -- dreamers have yet to turn in their paperwork. my colleague has a look at the markets. new zealand already trading for about 30 minutes. this after u.s. stocks gained for another day. we saw copper jumping two points
. also recovering 6.1% to about $60 a barrel. look at the all the dollar. it is settling below $.78. it has fallen more than 4%. in japan, nikkei futures is moderately high. i'm paul allen in sydney. technology"oomberg next. -- from "bloomberg technology" next. ♪ emily: welcome back to the "bloomberg technology." $11lix will not be charging a month for its most popular
plan. the streaming giant is looking to pay for its budget for tv shows and movies. netflix have hit a record highs and the announcement. , what doe from l.a. you make of this news? >> a couple years ago, netflix put a new high price. it come through again. they are bigger than ever, user base wise. they have looked and said we can get a little more out of subscribers. the market seems to agree with that. shares of region -- have risen a bunch. the market seems to
agree, but what about subscribers? will they stick around? >> history would say yes. they rolled it out very gradually and took their time expanding it to all users. the user base has continued to grow. even people who shut off the service after the pricing increase, it looks like they eventually came back. that is a good sign. it does not hurt to announce this right before the premier of season two of "stranger things." that is really what keeps people staying with netflix is that every few weeks, there is another show or a new season of a show that has been talked about. it keeps the buzz alive. emily: how much of the spending on original content? people talk about netflix
losing money. it depends on how you define it. they have been profitable for a number of years. the cash flow is the key to understanding. they spend all this money on content and have all these obligations to spend money for years and years. that content budget is $6 billion this year. it will be $7 billion next year. it will probably keep growing. month toother dollar a the subscription price helps alleviate that. emily: thank you so much. netflix is the main focus for many media companies. we spoke with fx network ceo who
has been very vocal about this disruption. we have to build our own brand. we launched something called fx plus with comcast a little more than a month ago. cox is joining and we are talking to other operators. that will be a subsumption service for people who want a whole brand. it is only available to basic cable subscribers. we can layer on our own subscription service area did they do not need to grow nearly to the skill that amazon, netflix, or hulu has. will evolve. the best ones have a very bright future. i would bet on hbo to be a thriving, successful brand.
theseyou look at platforms, is it a matter of reaching the audience or a matter on the cost side? you fits on giving the cost side. >> the cost of making quality television programming is going up. that is a good thing for consumers. part of the arms race is part of what is fueling this platinum age of television. too much content creates a paradox of choice, a different difficult system in which to navigate. i am a subscriber to these platforms. i am in amazon prime subscriber, netflix to describe her, hulu subscriber. i cannot navigate through the sheer volume of these platforms. i want show time. i want various brands to help me
navigate to excellence. platforms and brands have to learn how to coexist. i do not think silicon valley would agree with that assessment area -- assessment. i am bullish about this transition period. >> it has always been a challenge. in a day where you had three broadcast networks, you could build a brand doing it that way. it is much more complicated now with so much cheerio out there. withyou build a brand -- so much out there. how do you build a brand? >> you have to be a curator. you have to stand for something. we have a unique ability as an organization to seek relationships and create relationships to bring up the
very best and creative people. we have shown a track record of making numerous dramas, series that are not just good but great area and they are acclaimed among the best television being made. we have a unique skill set. most of that is what first time produces that you would not think about being brand names. we are not in the business of going out with a massive payroll and buying the a plus talent. fair in the business of developing that talent and their work from the ground up. we put it in a contest with all the great work we are doing today. it is a very powerful environment with which there is an extraordinary amount of
television of exceptional been nurtured has over time. the editor of one of the best magazines in america is doing something similar. i can only tell you as a consumer, i still find those editors and magazines to be incredibly valuable to giving me access to really great writing that provides context within the world we live in. i still rely on hbo and showtime and many other brands to navigate me towards breast in television. -- best in television. that in believe television, the silicon valley can manage to supplant every existing legacy brand. a do not think they can get all the talent. i do not think they have the breadth of skill set.
at -- that was the ceo of fx networks. forey weinstein, famous releasing oscar-winner is, has taken a leave of absence from his production company, following allegations of sexual harassment. ashley judd is one of those claiming to have been harassed by the producer. he is best known as the producer of miramax. an attorney said he denies many of the accusations as false. , what can the company due to innovate? we pose that question to internet star next. this is bloomberg. ♪
emily: we are watching shares of snap under pressure. they were cut after research showed smaller spending on appetizers and tough competition from facebook and instagram. meantime, entrepreneur and internet personality gary checks and as part of bloomberg's ongoing series. they covered snap and changes the company needs to make. >> we have to innovate in a way that is not featured. a feature is not the way you innovate. the cat is out of the bag. fast following features are not going to be a way that is not going to allow the house parties or the marco polo's to get there.
we have to give it some thought. what is ironic about that is snap is uniquely a company that could do that. i never met evan. i know a lot of the other characters. he is an l.a. kid. as as treated snapchat brand. he could go best field. -- left field. if i said it was snap, not adidas to put nike in a weird spot, it would not seem that far-fetched. are fetched as if i said twitter or facebook or uber did that. that is why i am fascinated with what snap is going to do. we will find out if evan was a one trick pony. they invest very aggressively. we will see if they can or will do anything there.
the other question is this. snap is an incredibly big platform i can build a very big business. it is just that the market all the value into that it will be continuing to grow. what is fascinating is that it is probably overvalued even amongst everything being overvalued. they will have to do something. they will have to truly innovate. emily: he was speaking to scarlet at the tech series. coming up, collegiate sports i headed to china asked alibaba. tech --between the chinese tech giant next. this is bloomberg. ♪
through 2024. immerse the first time in college sports network will be made available in china. they johnson sat down with commissioner larry scott and asked how big of a deal this truly is. >> it is a really big deal. first conference to have a comprehensive partnership outside the u.s. they will help us distribute a mass amount of content. chinese audience and help us have a regular-season basketball game in china. it is a big milestone for us. it is huge with great --erhouses like dan for, usc stanford, ufc and beyond. it is well-known. education -- we have 12 amazing
brands. andinterest in u.s. higher is hard. sports basketball has the most in china. the chinese play and love basketball. one of the interest in the pac-12 is that they know so much about it. they want to see where nba stars come from and see the highest level of amateur athletics and immature collegiate athletics. it is a novel concept. we are the only conference that has a regular-season -- this is an exhibition game. >> when we look at how this partnership works, that is interesting to me as well. >> in order to make this partnership work, they will have an event. probably could not do it. that digital transmission has
really allowed us to keep our cost down when it comes to the international distribution of our content. on the other hand, the connectivity we have with each of our campuses allows us to produce in a very efficient way of a huge amount of events. >> the quality is good enough that you could broadcast it in china with the same quality you would have seen on espn. about doing a pac-12 football game that might get a lot of interest. you could do a woman swimming that might not have ever seen tv because your cost of production is so much lower. >> that is why we created the pac-12 networks to be masters of our own destiny, to control.
it is true to our mission. in the pete -- in the past, we would license our rights. it brings insignificant revenue for our schools, significant exposure. all these olympic sports that might not have a lot on espn or fox, they were on telecast. our mission is to promote the , aboutased competition 7000 student athletes across 35 different sports. these are the best of the best. we want to promote these athletes and let our alumni and fans have access. we expose them. on top of football and 750etball games, we have
others that would not be on tv. emily: larry scott there with our editor at large corey johnson. joining me now, stephen angle. what do you make of alibaba's interest in u.s. college sports? >> it fits into the pattern of what they have been trying to do. he was a lacrosse player there. i saw in this press release, lacrosse will be one of those pac-12 sports being broadcast in china. it is basketball and football. china has become much more of the middle class aspirational society. it wants to go healthy and happy. they have invested in ever grand , the soccer team in china. they want to do more streaming of sports. it will play into that. students are at
pac-12 schools. 12,000 pac-12 alumni live in china. emily: how well with these games actually do in china? -- will be his games actually do in china? >> they have had some streaming in china. there are some sports that do not necessarily translate. this is the marketing tool as well for the pac-12 to get the eyeballs of the families in thea for this war and academic futures of their children, going to west coast schools area it will take time -- schools. there are some great names there. emily: when i lived in china, this was six or eight years ago, the narrative was the same brain drain students leaving china to go to the united states. is that though the trend -- still the trend?
are more students choosing to stay at home and choosing to study in china? >> looking to the united states, it is still the holy grail to students. there is a lot of prestige to going to universities in the united states. i think that will continue, especially with a lot of the children of college age. still the one child policy is, the family wants the best for them. thank you as always. that does it for this edition of "bloomberg technology." next week we will be broadcasting from the summit. do not miss our exclusive interviews next week on
announcer: from our studios in new york city, this is "charlie rose." charlie: we begin this evening with a terrible tragedy in las vegas and news coverage. good evening. we are on the 38th floor of the day hotel and casino. this is the view stephen paddock had when he opened fire on more than 20,000 people at a country music concert. when it was over, 58 were dead and more than 500 injured. i'm here, you can see