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tv   Bloomberg Business Week  Bloomberg  January 31, 2016 7:00am-7:31am EST

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>> welcome to bloomberg businessweek. coming up in this week's cover story, the behind-the-scenes battle for stoler energy. -- for solar energy. ahead we will meet chris cox and why he is facebook secret weapon in the quest for the alternative to the like button. giffy isook at how winning the internet. ♪
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a great issue of bloomberg businessweek. jesse drucker asking a provocative question. is the u.s. the new switzerland? the world's wealthy have been stashing their money in switzerland for secrecy. in the u.s., people putting their money in reno, nevada. -- covers uppiece us. walmart has come into communities and put mom and pop businesses out of business. we are going to see walmart, because it raised wages, beginning to pull out as well. not having a mom and pop grocery store and not having a -- to drive 50 miles to get to a pharmacy.
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good stuff. let's get started. we begin with this week's cover story in a clash of the titans. the battle between elon musk's solar company and the nevada utility company. owned by warren buffett. hey noah. clash,we get into this set the scene for us. talk about the incredible growth we have seen in solar energy over the last decade. because of a been couple of reasons. first and foremost the cost of solar panels has come down dramatically over the past couple of decades. another big reason is that companies like solar city, the elon musk affiliated firm that has been mentioned. they have come up with innovative ways to help homeowners finance. they will come out, put panels
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usually, youand are saving enough on your utility bill that even after you pay solar city your monthly, overall power bill comes down. that has been a big reason for why solar has been booming. -- so, solar city has made roads here in nevada. they have a lot of people getting solar panels on their roofs. >> nevada wasn't one of their first states. they only set up shop in 2014. they need the right government incentives and they -- it took a while to get those in place in nevada. once they set up shop it went crazy. nevada is largely desert. it is a no-brainer. people don't have that many trees in their yards. in the northeast people have a tree and they send solar city an
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application and they say we cannot put panels on your roof because there is too much stayed -- shade. you saw this incredible uptake and for most of last year, their fastest-growing market. happen as a result was the warren buffett owned utility called mv energy started flexing its muscles. it lobbied to keep a cap on the amount of people who could sell power back to the grid. it is a policy called netmeeting ring. metering. in december, they got a ruling favorable to the utility which makes it hard for solar city to do business in the state. it sounds like people who have solar panels on their roofs -- they are not using them. let's talk about the kind of
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muscle that and the energy was able to flex. utility, they are in a regulated industry. they have to stay close to policymakers. i do not think we saw anything different than what utility would deal -- do. they just did it very well. they were able to persuade lawmakers and later regulators to come around to their side -- their way of viewing things. people who put solar panels on the roof are not paying their fair share to update -- upkeep the grid. so they have new fleas -- fees in place. it is not that you can't go solar in nevada it is just that it is must -- much more expensive. people to geted solar power and on the other hand they are rejecting that.
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thisare siding with utility and keeping people from wanting to do it as readily as they did before. >> when you talk to people there, a common phrase that came up when i was in las vegas was late and switch. it is obviously a loaded term the solar industry is trying to politicize this whole thing. a lot of people feel like they were promised incentives and now the rules are being changed. >> we have talked about the lobbying. it sounds like you had a lot of people who were upset at these changes and tried to protest this. how did that play out? ago, in the middle of january, i was at a utility commission hearing. there were hundreds of people there. mark ruffalo, the actor, showed up to basically say the state
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and passedaired these rates on to rooftop solar people. it is an interesting story because some people are legitimately mad, but the solar industry and companies like solar city are definitely trying to promote that backlash because it is in their commercial interest to do so. homeowners who feeling they have been undermined? >> definitely. i talked to one who refinanced his house. this is before solar city showed up in nevada. put panels on0 to his roof. he knew it would bring down his power bills and he would have more certainty about the energy he was consuming and the cost of it. he told me he is waiting to see how these rates shakeout because he does not want to retire until he has a good handle.
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that may seem odd for folks who do not have steep power bills but in nevada, in the summer, people campaign hundreds of dollars to run their air conditioners in the middle of that desert heat. for solar this meant city's business model? first off, they are not a profitable company. they are growing fast. they have 350 million in annual revenue. they have said these new rates make it so they cannot do business in nevada. they have stopped installations. they are in the process of laying off 550 workers who were involved in sales. so yes, they basically view these new rates as a complete hand a rinse to doing business in nevada. >> thank you so much.
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online atllow facebook is looking to the future and mark zuckerberg is turning to his secret weapon for results. and hisle chris cox plans to move facebook forward. details on bloomberg television returns.
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>> welcome back to business week. he is facebook's secret weapon. chris cox was promoted to chief product officer back in may of 2014. he helped create the newsfeed. facebook has remade the way we
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like the world. under cox, that is all about to change. >> thanks for having me. david: talk about what chris cox has been trying to do here. the like button. reportedly, it is going away. >> is just getting some companions. we have all become very used to liking things on facebook. we use it for every kind of situation. what facebook is starting to realize is that people share a diversity of things on facebook, bad news included. they needed some options that were more empathetic or spoke to the range of human emotion that people could express. terrorist attack or national disaster or even a political story that you could have a different reaction. chris cox is coming up with alternatives. wowg them, angry, sad, also
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love.ha and ways to express yourself that go beyond the thumbs-up sign. david: you went about the genesis of this. how did it go over when chris cox proposed it? >> people have been trying to battle this for a while. facebook users have long called for a dislike button but facebook thought that kind of solution would just make the whole experience to negative -- too negative. in this case, it was cox who specializes in being empathetic, who has guided facebook to be more cautious about their product testing. to bring into users earlier so people are not surprised by things. to gradually introduce new products. he had a way of approaching this
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that was easier -- might be easier for people to understand. it only rolls out in a few countries right now but soon will be rolling out around the world. david: you mentioned that his role is to be the standardbearer for entity -- empathy. tell us about how he fits into the management hierarchy? >> as mark zuckerberg expands his range of things that he is dealing with, they have a big portfolio of stuff right now. i can list,, the service that includes an internet beaming drone that uses lasers to deliver coverage to people in remote parts of the world. zuckerberg is talking to foreign leaders around the world and barack obama. chris cox is the guy dealing with facebook on a day-to-day basis. he is running the big blue act.
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has gotten a lot of power lately and respect from people around him to be zuckerberg's right-hand man. to also be the voice of the user, the person coming up with how to treat the products. david: a lot of what you have talked about our complementry things. they are not part of facebook proper. this is a company that has tried to innovate before, tried to change what it has done for a long time, and it has not always been successful. yeah, there was the redesign, the newsfeed that got canned. newsfeed introduction it self, way back in the day, users did not seem to care for right away. over the last couple years, aris has brought to the table way of testing products that
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they have a panel of 1000 users around the u.s. that right there newsfeed -- there newsfeed newsfeed- their stories everyday. they have product tested sites where they observe people using the apps. it is much more research now. they are very careful with what they decide to release and how they think about rolling it out. they are not having grand presentations the way they used to. instead they are doing it in a scientific, measured way. david: you cover to twitter as well. twitter recently changed the way that you could favorite something on twitter. is it your sense that the same amount of interest and eagerness to test this out went over at
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twitter? under a different kind of pressure, where facebook be feel beholden to its users, twitter is in a position where it needs to attract many new users to satisfy investors who are hungry for growth. twitter has time pressure with a lot of their products changes, including the heart versus favorite. they are also trying to make it easier to sign up for twitter, to make it easier to find out what is going on. really basic things that would just help them get up to the level where facebook already is. david: what would be the metric of success here? what will be the mark of that succeeding for facebook? is always about whether people use the product more.
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right now, people use facebook thants companion apps more 40 minutes a day on their mobile phones. it is incredible. if that time spent goes up or down, chris and his team will know whether they have a great success on their hands or a great mistake. facebook,ces time on they might have to rollback the change. we will see. david: coming up, we go to the back of the book for this week's etc. section. y on the rise of giff internet. bloomberg television continues.
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david: welcome back to business week.
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inot of off-season turnover the league of legends championship series. that is the world's most prominently for competitive video gaming. team owners are imposing changes. was put in business week's roosting -- and -- >> what re: sports? >> it is competitive video games. set up to play against your friends and it has developed into a thing where you play against strangers. the new play against strangers for money. it developed naturally. money and getting people to watch these games being played. >> the championship series is being played in front of a live audience. it is streamed online. people watched platforms like
7:22 am like -- which is by amazon. david: how long have people been doing this? >> in the 80's, there was a aboutstarring fred savage the nintendo world championships. it has been around for a while but it has taken off in the last couple of years because of these large online audiences. people are used to live streaming so that has had a takeoff. david: how useful is the parallel to professional sports? is there a lot of excitement surrounding these? how do you get people watching these to pay attention? >> there is an obvious parallel and that these are events that happened regularly, they have fans, and there are seasons and things like that. it has been funny to watch them struggle with this, it is not an
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exact metaphor, but there is such obvious parallel dealing with problems like "should we do what the nfl has done or do we need to figure out some other way to do it." play -- whats the does the play look like? >> in league of legends, there are teams of five guys, they are usually skinny young men wearing t-shirts. it is a young man's sport. usually there is a coach who wears a suit, and it looks like it is one of his first suits. they sit down at a row of computers and just quietly play video games. they have headsets on so they are talking to one another and above them is a large screen showing what is happening. the fans are mostly reacting to that. david: how long do these last?
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does it go on for days at a time? there was actually in this most recent series one game which was one of the quickest in history that lasted 18 minutes. they normally go longer than of competitiony is stacked with a number of games happening back to back. you can bring in euro food, you can stay all day. david: time to take a look at the etc. part of the magazine. brett begin edited this section. let's have a little debate here. s.f gif andmajority says there is a vocal minority that says jif. so younder also uses jif
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are fine either way. >> their bread and butter is that they are essentially a library for gifs. if you need to find one to test your friend, that perfect one that is going to sum up your emotions better than any words can. they also work with subway and the nba and hbo and victoria's secret. essentially helping users use as auests -- gif communication tool. loop.a second long video it is nothing more than that. it was popularized around the time when people were building myspace pages and it was a way to personalize your page. it died off when myspace died off but a lot of news sites, breezy or news sites like was feed have been using the gif to
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tell stories. making these? >> it does make some gifts -- gifs. tv shows and movies studios will make sure their products are available but they are also scouring the internet to make sure that they fall within their index. they also spend a lot of time making sure no nudity gets on the site. gif?: what makes a good >> the ability to tell a story really quickly or to sum up a feeling in the same way you might text someone and demoted emog there are companies working with gifs >>.o make
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of funding right now. they have more than $20 million in funding and they were given a million dollars by a company that was heavily involved in kickstarter. they are focused on growth, not revenue. they could put ads on pages if you were searching for a cat gif . they have decided not to do that right now because they know that users are pretty fickle and they don't want people to be turned off by that. david: thank you so much. that does it for this week's addition of -- edition of bloomberg businessweek. is availabledition online and on newsstands. we will see you next week right here on bloomberg television.
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narrator: our world today is wealthier than ever. but not everyone shares in this wealth. today's young business leaders are challenging this, changing the way we think about money, it's power and its purpose. this is a new generation. this is the new philanthropy. ♪ alejandro legorreta is one of mexico's most adventurous


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