tv Bloomberg Technology Bloomberg October 9, 2017 5:00pm-6:00pm EDT
individuals to pool together and buy insurance outside their state. president trump could sign the orders this week. e.p.a. administrator pruitt says the trump administration will abandon the obama-era clean power plan aimed at reducing global warming. pruitt says he will sign a proposal tomorrow to withdraw the plan that is aimed at restricting greenhouse gas emissions from coal-fired power plants. officials say at least one person is dead and two others seriously injured in more than a dozen fast-spreeding wildfires in northern california wine country. a fire official says at least 1,500 structures are destroyed. and turkey's president says the diplomatic dispute that washington anding an are a is having is very -- and an cora is having is very saddening. visa. the dispute started after turkey arrested a national who works at u.s.a. consulate. and senator feinstein is throwing her hat into the ring
again. the california democrat taking to social media to say she is running for a fifth full term. global news 24 hours a day, pourd by more than 2,700 journalists and analysts in more than 120 countries. this is bloomberg. ♪ corey: this is "bloomberg technology." coming up, russia's google connection and google's russia connection. the big tech company saying they took money from the kremlin's hackers. we'll discuss google's role in fake news. plus, tech and taxes. apple c.e.o. meets with french p.m. in paris as they waive sweeping overhauls of digital
platforms across europe. and a wide ranging interview with the former microsoft c.e.o. steve ballmer. his thoughts on twitter, trump, immigration and his enduring legacy. but first, to our lead russia linked accounts used google to influence the 2016 u.s. presidential election. google investigators found that nearly 5,000 dollars, they're also investigating another $53,000 in ads spending coming from russia at large. first reported in "the washington post" and "the new york times." the admission is new. google previously said it couldn't find any evidence of russian interference. but data from twitter proved the arlier contention was wrong. what are they telling us that's you? >> they're not telling us anything which is frustrating. they're still beginning their probe. but we know that they've used google properties. it sounds like they found, as you said, on there $5,000 worth of ads. we're not sure if they ran on
youtube, g mail search. google -- right now the problem is focused on facebook but google has a much bigger sprawling network of advertising. there's a bunch of different channels that russian actors could use. cory: we talked about this on bloomberg radio a little while ago. people who wanted a preview of this conversation could have been listening to bloomberg radio in the last hour. but one of the interesting things is they have all kind of systems suppose lid involved to make sure that, say, their customers pay them. or to understand that the content gets there on time or gets delivered in a proper way. it looks like they didn't have any system either to vet the stuff before it went out, or even afterwards. we've been talking about russian interference in this election for more than a year now. google just coming with this information. >> yeah. i think part of the issue is drawing a line. we felt this morning they were saying there's a poll bucket, $53,000 wort of -- worth of ads. these are either trolls or spreading misinformation or lies o. this is just russian accounts hat we're spending on.
cory: the notion otherwise is that some of it could be legitimate ads. not fake news. >> yeah. i think so. i think that's where -- there's probably behind the scenes, both in the board room and negotiating with congress, where the line is drawn here. cory: it might be drawn at disclosure, right? advertising everywhere, whether on print or the airwaves or all have to say where the money comes from for a political ad. >> right. that seems to be the direction we're moving. congress is putting more pressure, facebook and google have been resisting this for a long time. political spending is pretty big on the platforms and it's growing. this election was a really good case point for that. cory: we talked to a congressman last week who has seen what the facebook ads were. facebook won't share that with us. they've seen at that time least. check this out.
>> when you talk about the issues of race, the divisive points in our country, the issue of immigration and migration. and how the american public was reacting to that. just remind yourself how candidate trump used those issues to heat up the american public and clearly the russians exploited that at the same time. cory: so the idea that this is the stuff that was about -- it was the racist ads, at least on face boorks racist ads, perhaps anti-semitic ads. certainly anti-immigrant things. the very things that were stirring up voters in some places to vote for president trump. >> right. i think with google, it's interesting, a lot of these websites that had a big presence on face boork, one of the reasons -- on facebook, one of the ways they're making money is on ads. a lot of the fake news sites probably had banner ads that were run by google. but both google and facebook are in weird position where they've been telling people, we have amazing tools for targeting -- reaching your consumers and now
they're going to step back and say, well, maybe -- these weren't as effective and certainly not -- these weren't the deciding factor in the election. cory: this is also -- it's interesting that it was so -- the russians, the bad actors in russia were so on top of the latest trends in advertising. i can look at the role that google and facebook have in a global advertising market. what you see is, number one, that that number is growing. you can see these pies are getting bigger. bars actually. the columns are getting bigger which is to suggest more money. but also in terms of percentage of revenue. this is a percentage of revenue for google in the advertising market. much bigger than facebook. a growing percentage of revenue in the global advertising market which shows that the russian hackers were on top of the most effective ways to reach people in modern society. russia got it even if u.s. regulators didn't. >> yeah. i think daily beat had a fascinating story, they claimed
their video bloggers on youtube, that russian networks had paid. that's where these are, as youtube is all user-generated content, they might not be even running ads. certainly isn't something that google made them be aware of. that would be an instance of organic reach. this is not necessarily paid ads but these are using youtube. the world's biggest video platform to spread lies and propaganda. cory: that's the u.s. who knows what's going on in other elections all around the world. emily chang sat down with steve ballmer, los angeles clippers owner, of course, for a wide ranging interview in seattle. ballmer's home. ballmer confirmed he still has a big chunk of twitter but he thinks the company could be oing more. >> they're drivinging forward. more, better faster is always good. i'd love to see more, better,
faster. >> more, better of what? >> more better products, more better revenue, more better earnings, cost structure, you name it. that's not a specific criticism. it's just a general view that things need to move even faster. cory: full disclosure, bloomberg l.p. in partnership with twitter to produce a global breaking news video network. we're putting that together right now. later we're going to show a lot more of that interview. plus steve ballmer's thoughts on president trump, immigration and his legacy at microsoft. coming up, more of bloomberg technology's d coverage in seattle this week. talking to politicians, business leaders, all about the tech industry. transforming the emerald city. ♪
cory: all this week "bloomberg technology" broadcasting from seattle. amazon, microsoft and v.m.ware, it's a hub for technology and innovation. outside of those tech giants, also a home to a growing number of startups that could lead the way with a.i. and cloud computing. always a pleasure to see you.
look at you with the bloomberg monitors behind you. we've been talking about this for a long time. about what makes seattle such a tech hub and i wonder, we mentioned those great big companies. surely microsoft in the historyry of microsoft in that city, you have to start there. >> you have to start with microsoft. they've been a huge driver of the software ecosystem and now the cloud ecosystem. as you say, two of the top five market cap companies in the world are the tech companies in amazon and microsoft. just a plethora of startups and there's thousands and thousands of folks working to get companies like google and facebook up here. so we really have it covered in terms of diversity of perspectives in the tech industry. cory: i guess we leave out facebook and other companies that have very -- a large presence up there. google included that have hired so many people and have such big operations there. tell me, is it trying to chase after all those great engineers who might be falling off of all those other places or have gone to seattle for opportunities at
amazon and microsoft, but find themselves, oh, wow, facebook's here, google's here, there's opportunity? >> let me give you an example. there's a great team that was up here for google that invented this technology called -- which manages containers. that team is up here from google. they decided to leave and build a business around that and we funded it, along with our friends. these are the kind of things that happen. or a company like a smart sheet which has a deep ecosystem rely on the cloud partners both at microsoft and amazon in building up a business now that's well over $100 million and rapidly growing. so that's what we like to see. there's talent that comes and goes from this different companies and oftentimes they get inspired to start from scratch and build something new. cory: is there -- any kind of industry area we might want to say that seattle's known for? i would venture cloud is a certain thing up there, with amazon web services and v.m. >> i think hands down we're the
cloud capital of the world. i was visiting with a group of executives from a company today and we have alibaba offices and other companies trying to understand what's next cloud. we believe that's serverless technologies and microservices architectures. but i think what's overlooked sometimes is just how big areas like machine learning and artificial intelligence are up here. with paul allen's artificial intelligence institute, university of washington's school of artificial intelligence. they're doing great things as well. and then finally, what about all the ways we interface with computing? think about alexa with voice or mixed reality in some of the areas that microsoft's involved with. so we have the full stack here. some of the leading edge things that are going on in next generation computing. cory: i would be amiss if i didn't mention the role of udub which you just did. not just because they're 6-0 and number five in the country right
now. much to the pain of my heart. t i think nationally maybe u.w.'s role, university of washington's role, is overlooked in the role sort of driving this -- what is the university of washington so good at when it comes to teching to? >> one area is this area of machine learning and artificial intelligence. they recruited an incredible professor five years ago from carnegie melon and he became the amazon professor of machine learning. we promptly started a company with some of his team and built that company which was called dato into one of the leading players in machine learning as a service. that company was then bought by apple and apple's now building a bigger and bigger presence up here in seattle. so i think machine learning and a.i. professors over there at the university of washington probably one of the most interesting examples now is a company called xnor that a professor has founded. that's all about machine
learning and artificial intelligence at the edge. so the edge computing side versus the cloud computing side. some of the things that are starting to happen at the internet of things kind of area related to deep learning. cory: so when we talk about all these places that want to start, what looks like silicon valley, where chicago or phoenix or austin or grand rapids or you name it, another thing that seattle has going for it, you have your very strong university focus and technical skills. you have your established technology innovators that are throwing off -- people made a lot of money and want to try again. but you have a very active venture capital community. you can pat yourself on shoulder right now but madrona has been there from the start. you were one of the early backers of amazon. what's the venture scene like in seattle and how is it different than silicon valley? >> our focus is going all the way back to the first investors in amazon back in 1995, focus on day one opportunities and day
one founders. get involved at a very early stage. i mentioned carlos and some other examples. so thereby at day one but be there for the long term and be there focused on the specific northwest. we think there are a bunch of great capital venture firms. we just focused on early stage companies in the northwest. we also really work well with those other firms and there's a growing interest once again. there was kind of a cycle in the late 1990's and now we're back here 20 years later with very strong interests from silicon valley partners, working in conjunction with us and others. we have a vibrant angel community. not just superangel investors but large family offices. paul allen and others. trilogy with john stanton from the wireless industry. so there's really a nice mix of folks in the kind of large family offices that we like to work with together as well. cory: you can't beat the state taxes. if you're an entrepreneur who thinks you're going to get rich,
i remember this guy, a woman i used to work with, her husband was about to come into a bunch of money from a wireless company her father was selling. they moved to washington to establish residence because there wasn't going to be any state sales taxes for them but they wanted to stay involved in the technology community. it seems that's a big draw for the like of bill gates and others. >> i think that some of those folks very intentionally either started their company or moved their company here to washington and seattle specifically for that reason. we don't have a state income tax. that's a massive competitive advantage over other states. and i think that's why you're seeing thousands and thousands of employees from companies like google and facebook that can choose to live up here to live up here. so that advantage is very important. but here's the punch line on that. our tax revenues are up from $28 billion to $38 billion, $10 billion in the last six years. that's because we have this pro-investment, pro-growth, pro-opportunity community up here in seattle. and the other punch line there is, we have the lowest
unemployment rate in the history of the city of seattle and the state of washington. so i think we have a pretty good tax system. no tax system is perfect. but ours is growing and our economy's growing. i think that's going to really serve the entire community well for the long term. cory: couldn't agree more. i don't want to throw cold water and mention the weather in february because that's when the cold water gets thrown but i think it's worth it up in seattle. matt, always a pleasure. always appreciate it. he'll be joining us again later in the show. so stick around. elon musk spacex launched its 14th rocket of the year. bringing the company close toirts target of missions in 2017. the falcon 9 rocket carrying 10 satellites for communications. another rocket launch from florida next wednesday. that rocket will deliver a satellite. coming up, apple c.e.o. tim cook in the city of light. how he plans to combat e.u. tax reform without first targeting big tech companies. this is bloomberg. ♪
cory: apple c.e.o. met with french president macron in paris monday. the meetup comes amid calls by european nation for an aggressive overhaum of how tech companies are paying tax across the e.u. joining us now, our bloomberg technology reporter who has agreed to talk in a funny accent for us today. thank you. >> [speaking foreign language] cory: i'm all for the french. this is an interesting drive right here. apple is center in this.
particularly because of the deal they got in ireland. >> yes. apple very much says they didn't get a deal in ireland. but apple's facing increasing heat in ireland as well to pay this tax bill which hasn't been delivered to ireland as far as we understand it. in escrow perhaps somewhere. cory: is it or not? they got criticism following the demand to pay it saying that they hadn't put it aside. >> yes. they put it aside in their account somewhere but ireland hasn't received it and they were talking about putting in escrow for itself while it appealed it. that hasn't happened. we knew that early last month, four european finance ministers, france, germany, italy and spain, they sent a letter to the european commission proposing a system whereby big tech companies are tax based on revenue and not by profit. i think the argument then being that it's harder to push the profit into the low tax nation, perhaps like ireland, and
therefore they wouldn't be allegedly abating -- evading taxes so to speak. cory: is apple the canary in the coal mine here? are they the company that will ultimately make the deal that all the rest of the companies are going to have to follow? or is it going to be different treatments for these companies? >> the companies are not going to make deals with nation states or indeed with the european regulatory authorities. so it's going to happen, there will be a change in the law at that level. we know the european commission -- sorry, the european parliament can be very slow moving when that stuff happens. the fact is that apple is not the only company doing this. there is of course issues with amazon and others and indeed companies outside tech. cory: and what is a fundamental issue, how have they been able to skirt these taxes and follow the law as they see it but not pay the same amount of taxes as companies based on the continent? >> apple, what's happened historically and the whole issue of contention, bone of contention last year, was that
they were paying essentially a license fee for intellectual property which was held in different geographies and that was why they said, we're not actually generating any profit in this country. the profit is being generated by another unit elsewhere. that deal ended several years ago so apple is now for this year and last year, for example, paying the higher tax rate. the issue then comes that the tax rate in places like ireland, just organically, is a lot lower than it is in the u.s. so they pay 12.5% tax in ireland. the moment they bring back murn from ireland, for instance, they have to pay that difference with the u.s. i think it's 35% in the u.s. and that 22.5% goes into u.s. treasury coughers. which is why the deal -- coffers. which is why the deal in the white house right now is so important. cory: and where the intellectual property resides and all that stuff gets very complicated. that's why we're glad to have you explain it to us. our own spy who came in from the
coal. did watch that. thank you very much. coming up, steve ballmer speaks out. our interview with former c.e.o. of microsoft. his take on tax reform, immigration and the idea of fake news next. ♪ and if you like bloomberg news, check you theous -- us out on radio, check me out on the radio. listen on bloomberg radio app, bloomberg.com and the u.s. and sirius x.m. station 119. this is bloomberg. ♪ who knew that phones would start doing everything?
see how much you can save. choose by the gig or unlimited. xfinity mobile. a new kind of network designed to save you money. call, visit or go to xfinitymobile.com. >> you're watching "bloomberg technology." let's begin with a check of first word news. british prime minister teresa may says the framework of her brexit plan has not changed since her speech last month in florence.
may addressed britain's house of commons today as a fifth round of negotiations with the e.u. are set to get under way. >> as i set out in my speech in florence we want to take a cretive -- creative and pragmatic approach to the -- to securing a new, deep and special partnership with the european union, which spans both the new economic relationship and a new security relationship. >> european diplomats are ramping up efforts to ensure president trump's decision to dessertify iran's compliance doesn't risk scuttling the international nuclear accord. allies are said to be seeking out members of congress and trying to influence administration advisors. tokyo's governor says that her doubts about the trump administration, her party of hope is challenging abe's ruling party and the general election scheduled for october 22. >> i am not yet sure whether the
trump administration is stable. there are extremely dynamic personal changes in the daily white house posts. along with the american people, i want to look carefully to see what kind of administration this will be. >> japan's election is less than two weeks away and she must decide today if she will run. more than a dozen wildfires whipped by powerful winds swept through california wine country, destroying at least 1,500 homes and businesses and forcing an estimated 20,000 people to leave the area. at least one death has been reported. this is bloomberg. it's just after 5:30 p.m. here in new york. 8:30 thursday morning in sydney. paul allen has a look at the markets. good morning. >> good morning. let's start off in new zealand where trading's been under way for about 30 minutes tuesday morning. and the index off .10%. this after we saw u.s. stocks drift lower on pretty low volumes due to the columbus day
holiday. we saw gold up a little. west texas slightly higher. still under $50.a barrel. here in australia, futures down. the aussie dollar little changed . after a horror retail read a week ago. nikkei futures pretty flat at the moment. waiting on current accounts na numbers for august out of japan. estimated to come in at $19.7 billion surplus. more from "bloomberg technology" next. ♪ cory: this is "bloomberg technology." now a look back at our top story. tech companies are finding russian-linked accounts that interfered with the 2016
presidential election. and that worries twitter shareholder and former microsoft c.e.o. steve ballmer. he says companies can't do more at the present moment to police the spread of fake news. emily chang sat down with the l.a. clippers owner in seattle. >> we launched our platform of data from the government, about the government. no fake news. no alternate facts. we launched on tax day. we keep adding more data and we keep the information current. but the real thing we're doing now at usafacts.org, in case somebody wants to check, is we're trying to help citizens really run through topics of the day. so we have a walk-through up there right now that will walk you through the president's budget, in the context of what has happened historically. what does g.d.p. look like, what has tax revenue looked like? what does the deficit look like and how does all of that compare to the c.b.o.? we make no predictions. we're going to make sure people can walk through and look at these government proposals in the context of the past.
that's all that's factual. then be able to say, does this make sense to me or not? we have a little video that goes along with it that will explain to citizens, this is kind of the set of data and the way to think about -- by the number, how do you think about something like the budget proposal? reporter: you say it's just the facts. i know you know these facts better than almost anyone. as the lawmakers and the president talk about tax reform and health care, do you have any advice? >> yeah, in a way i do. these things are holistic issues. it's sort of funny to me. we look at tax reform and the budget and we look at health care. yet when you really look at the economics of these three things, they're laced just like this. what does it mean to have a budget without tax reform? it's our process, i'm not condemning anybody. but it's kind of nutty. you have to have a tax plan in order to have a bufplgt be like a company having an expanse plan without a revenue plan -- expense plan without a revenue plan. it doesn't make sense. one of the biggest pieces of expenses, that's health care. you don't -- i mean, how do
these things -- so really understanding how these things mesh together would be a key piece of advice i would certainly give decision makers, legislators and executive branch. reporter: you mention this is an age of misinformation, of fake news. how big a problem is that? and what's the responsibility of these platforms? facebook, google, twitter? >> i think this notion of people being able to sort of be fed whatever's going make them feel good, because that's what people are really doing. people want to feed whatever the instincts are. i think the goal has to be to say, this is how it looks. you can see it any way you want to. but some place you have to come and be able to take a look at stuff objectively. i'm not sure you can say that's facebook's job. they're not in the news business. they pass along other people's news. same thing with google. that's part of the issue here. things can look authentic. we did a u.s.a. facts poll and when surveyed people would say, i find my information most often
on social media and i trust it the least. reporter: do you think facebook and google and twitter should be policing this more or that's not their job? >> they can't much it's not in the nature of what's going on. i think over time there needs to be something that's the equivalent of authenticated user on twitter where you get the little bullet that says you really are who you say you are. i think it would be nice to have authenticated sources so that people can say, i really want to see not just what the crowd is saying, but i want to hear from some authentic sources. reporter: what if that information isn't coming from the crowd? if it's coming from our own president? is it a problem if he's the one spreading misinformation? >> well, we elected the president. our country as a whole. he is our sort of president in chief and i know there's people who have problems with that and people who are supportive of that. but at least when the president speaks, he's speaking
authentically for himself. in a sense that is a set of facts. when a mainly policy leader speaks -- major policy leader speaks, you can say, it's true, it's not, you like what he says, you don't like what he says. but what he's thinking. and every voter probably benefits by having the ability to hear directly, just as we hear directly from other people. i get a chance to speak directly on the internet, lebron james gets a chance to speak directly on the internet. not everyone want to hear what people say to one another. they don't always agree. certainly we've seen that with lebanon and the president -- lebron and the president. reporter: there are some who say the president is taking it no another level. perhaps even inciting nuclear war on twitter. should he be kicked off twitter? should he be allowed to make these statements on twitter? >> everybody has the right to speak for themselves. that includes the president of the united states. everybody has the right to speak for themselves.
that's kind of in the fundamental nature of this country. and i think it's an important one. i think the citizens have an obligation to elect the people who i think -- who they think will best represent their interests. and that gets a chance to get battle tested, every two years, every four years, i love our system. because people have to constantly prove themselves and if people are doing things that are not valued, that will come across. and if people are doing things that are valued. now, the way our system works, it doesn't take 100% to win. it takes logically 51%, of course with the electoral college that's not really what it is. but it takes logically 51% to win. and people have a right to hear directly in their -- as they go cast their ballots. reporter: you ran microsoft for many years. you've dealt with issues like immigration. do you have any concerns about the stance the president is taking on things like daca, for example? >> i think immigration is a
super important thing. my dad was an immigrant. my grandparents on the other side were immigrants. i value the fact that immigrants come in to this country. i think it is hugely, hugely important. it's not something that was just important 100 years ago. it remains important. it remains important in terms of high-tech workers coming into the country, it remains important in terms of people moving back and forth across our southern border. and there are complicated issues, there are issues of national security. but there are also issues of economy and fundamental humanity. i do think it's important to look at all of those things, including humanity. as we kind of address the plight of the so-called daca. cory: great stuff. that was some of our conversations with former microsoft c.e.o. steve ballmer. coming up, more ballmer. his thoughts on the knicks' legacy and the future of artificial intelligence.
cory: back to l.a. clippers owner steve ballmer. emily chang sat down with ballmer, former microsoft c.e.o., of course, to ask what he thinks about the current c.e.o., what it's like to watch him take over. >> he recognizes the good, he recognizes the things that needed to be changed. i think he's navigated that
very, very well. from my perspective, you know, we knew we needed to get into the cloud. i got that started. he's taken it to another level and i respect the fact that he's had to do things differently. i knew things would have to be done differently in that area. that's the reason it was a good time for a change, if you will hardware's a whole different deal. he's pushed that along with xbox and surface and i kind of respect that needed things done differently. and over time things need to be shaken up and freshened and i had been at microsoft the whole time. it reflected my personality and bill's personality. but kind of like children, things need to keep growing if you will. and we rev he will when our children -- revel when our children are grown up and are sort of making their own way. and i revel that he's taking microsoft to its next level.
sort of going forth in new and in different ways. emily: so amazon web services still much bigger and growing faster. do you want more, better, faster from that and the cloud? >> sure, i do. absolutely. [laughter] as an investor on our quarterly call, i say, come on, let's keep it moving. emily: are you listen into all the calls? >> no. like any other large investor, do i a quarterly call with the c.f.o. and i think microsoft's done a pretty phenomenal job. particularly on the office side. but also on the azur side. but is there a lot of room for improvement? because the market leader on the azur side is pretty damn big? yeah, i do think there is. emily: what kind of improvement? >> you need to have even better attachment and ability to sell to startups and other development companies.
developers, developers, developers. and with azur you have to win the developers. i think microsoft's getting there. but still has a lot more to do. emily: you said you're done being an investor. is that still the case? >> yeah. i'm not making, quote, new investments, unquote. emily: just mutual funds and microsoft and twitter? >> index funds. keep it simple. have everything pegged to the market. i have some bonds. i have microsoft. i have twitter. then i have a couple small private things that i don't do much of. but i have a basketball-based investment. i have one investment with a couple friends. that's it. emily: there's a big debate about the future of a.i. and whether it's dangerous or not. elon musk thinks robots could take over the world. they could supersede the human race. mark zummerberg has said that's irresponsible to talk -- zuckerberg has said it's irresponsible to talk like that. what do you think? there that's the usually, what
vessence , he waser of the tech company. let's say something extreme, let's tune it down. when you get down to it, is a.i. very important? yes. will it improve the way people live? yes. do we know all of what we will accomplish today? no. but getting computers to be smarter at helping people do what they want to do every day, that part can't get bad. i'm sure there's a place in time -- and time where we can speculate about all of the tough societal issues. ut we're years away from that. elon musk, of course what he says in the long run could be right. but the long run could be a long, long run. not going to happen the next 10 years or so. and of course zuckerberg's ready and prepared and, you know, sort of right to talk about that. but right now, put some of that clutter out of your mind. this artificial intelligence
stuff will make a big difference. emily: you think it's possible that the human race could become extinct? >> no. the human race isn't going to become extinct. but how powerful will be computer's ability to reason and what will that fully mean, we don't know. but we're not going to deal with that problem for 20 years. cory: that was bloomberg's emily chang with clippers owner and ex-microsoft c.e.o. steve ballmer. now back with matt, managing director. talk to me about steve and his role there in seattle. obviously he's got an l.a. team even while he lives up in seattle. >> yeah. he still has a significant presence up here. i think people overlook what a great job he did on growing the top line and the profitability of microsoft and making the early bet scenarios like cloud and hardware. i'm sure there were areas, acquisitions that were tough. there were other challenges. but in the aggregate -- cory: you think? >> oh, yeah, there were some.
cory: nokia. can we remember nokia? can we talk about some of the things -- i mean, i think steve's great and he's a great owner of the clippers too, but there were some multibillion dollar things under his leadership that went way off board. not to mention all the problems with anti-trust around microsoft windows. >> well, i think advertising and mobile were areas that were real struggles in that era. but if you look at things like where he laid the groundwork and sachi leading the cloud business before he became c.e.o., they've headed in the right direction on the cloud side. they have massive advantages there. not only do they have real established apps in office 365 and other things, but they've got all the on-premise presence that allows you to collect this increasingly hybrid world. so i think they have a really good strategic position. i think they doubled on the things that were working and leveraged some of their strengths. but steve did a good job setting the table in a bunch of different areas.
cory: what is the lasting impact? i mentioned the anti-trust issues around explorer and microsoft windows. but i wonder if seattle what the lasting impact is? particularly around companies like microsoft and amazon, when they start to think about those issues? >> i think those are interesting topics around anti-trust. it's being raised in a bunch of different ways these days. i think that all of the big companies, whether it's the facebook and googles down your way, or the microsofts and amazons here, need to be cognizant that as platform companies, they have to be good at creating a genuine platform that other people can succeed on. and also being successful for themselves. i think that if you look at all of that group, i'd probably highlight google. let's take a recent example of google cutting off amazon echo shows from youtube. what's up with that? i can't get access over wi-fi to youtube because i don't like the device it's being accessed from? there's lots of questions you can ask on that area. i don't think the companies in
seattle are in as difficult a position as some of the companies down in the valley. cory: maybe because they remember the days of yore. i know you remember a lot, we're grateful to have you all the time. thank you very much. >> thank you. cory: coming up, investors can't get enough of the apple iphone suppliers, giving rise to an interesting new e.t.f. we'll explain next. this is bloomberg. ♪
iphone 10, suppliersre only growing. there's a new apple supplier e.t.f. bloomberg he is -- bloomberg's north asia correspondent is in hong kong and is kind enough to join me. thank you very much. this is fascinating because this has been an investment scene for the longest time. what's going into the new device and certainly what's going into the next iphone? >> you see this all the time in taiwan with the lead-up of the apple product releases in the autumn. the gyrations, the ups and the downs and there's lots of rumors of course about what apple is going to release and whether it's going to be popular and we've seen already a lot of these suppliers, a dip in september, some upwards of 25%, 30%, because early iphone the 8 sales or orders were not as robust as expected. but now it's going back up on anticipation for the x or the 10 coming out november 3. so there are lots of gyrations. if you look at this particular ishares, it really exemplifies
the sweet spot that taiwan has in the supply chain for apple and all the suppliers. because 49% of the 91 companies in this e.t.f. are tied to apple. 41% of the companies say apple is their top customer. 18% of all the companies, the 91 companies, say apple is their top revenue source. so you can see that sweet spot. but on the other hand, you can also see why the likes of the president are trying to diversify the taiwan economy. into biotech, into other areas. because companies make up a quarter of the tie ex and they want to diversify -- thai-x. and they want to diversify. cory: it seems like it allows investors to at least in theory lower transaction costs for acquiring that portfolio in terms of how many trades they have to put up. but secondly, figure out what the heck's in the iphone and know which companies to own. >> yeah, that's right. one of the biggest hallmarks of
becoming a supplier of apple is secrecy. you have to keep your secrets pretty closed and those doors closed at those suppliers. ike pegatron, like largon. you go down the list. quantum computer. advanced semiconductor. so many of these companies. again, citigroup is saying, because of those gyrations that we had in september, now coming back up, time to buy companies like largon, they make everything from the screen, the opotoelectronic components to of course becoming the assembler of the iphones. cory: and of course the challenge, you never know where the profits are. some of these companies can supply a lot of stuff with almost no profit. others mike take -- might be taking away millions. >> absolutely. again, we have to kind of dig into each individual stock. catcher technology is one in particular that i've been looking at. they make the casings for the
smartphones. it took a tumble like a lot of the other ones but a lot of these companies, at least the numbers, are looking pretty cheap in fact. estimated forward p.e. of catcher, 11 times earnings right now. sales in september record high, 48% up. third quarter looking like a record as well. cory: that's your bet, not mine. i'll let you go there. thank you very much. that does it for they hadition of "bloomberg technology." tune in tomorrow for our coverage of the geek wire summit in seattle. we'll talk to starbucks c.e.o. 1:00 back east. 10:00 a.m. on the west coast. right here, bloomberg television. this is bloomberg. ♪ nurle -- ♪ ♪
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if you're doso done... complicated, so done... call now to enroll in a plan from unitedhealthcare, like aarp medicarecomplete. [sfx: mnemonic] >> from our studios in new york city, this is "charlie rose." charlie: we begin this program with news out of washington. after weeks of speculation and against the advice of his national security advisors, president trump is expected to dessertify the iran nuclear deal next week. what does that mean for the future? david sanger joins me now from washington. he is the national security correspondent of the "new york times." david, let me just begin with you explaining the difference between dessertifying or failing o certify, and withdrawal. >> there is a big