tv Best of Bloomberg Technology Bloomberg September 9, 2017 6:00am-7:00am EDT
emily: i am emily chang in this is the best of "bloomberg technology." coming up, years and still completed its tie up. we will talk to michael dell about the partnership and the your landscape. the divide deepens between the president and tax. signed a 400 leaders letter on behalf of 800,000 people whose american dreams are
on hold. the social media giant said they found political ad ending link to fake accounts from russia in the run-up to the presidential election. techcompleted the biggest position in history one year ago. new dellcreated the tech knowledge he. -- technology. major legaleveral hurdles along with emc stockholder skepticism. i sat down with michael dell and asked him or the one-year report card. michael: i am very pleased with how it's going. it's been very strongly positive, our teams are very engaged. our customer in ps scores have continued to improve. our record high levels of synergies are coming to your
faster than we thought. we are paying down debt and aggressive pace. a lot of things that could go wrong did go wrong. the big surprise is we have not had a lot of surprises. access -- we see the success. the business is doing very well. debt and a pck on market that had been sluggish. how did you navigate the challenges? michael: i will tell you, we are a share. have questioned the durability of some of our businesses, but they have held up incredibly well. we are gaining share. to be able to navigate this and
bring the family together, customer reaction is very strong. got some that to continue the growth and expansion. we have great investment ratings. it is quite strong. emily: do you see more consolidation in the industry? the big players are getting anger. will that continue? michael: customers don't want to have a bunch of small companies that they work with. there are deep reasons why these should be more integrated. if you think about what integrating networking and virtual live storage and how you manage software in a manner that is consistent with what customers want.
how'd you create a cloud environment? emily: how do you stay nimble and make sure you are innovating from within? is it about m&a? michael: it's both and the partnerships and the venture capital that we employ in new companies. $4 billion in r&d across the family. emily: where'd you see yourself in five years? michael: our customers are engaged in forward transformation simultaneously. it's an exciting time in our world. datao you use all of this that is being created with all of these intelligent sensors being created and connected devices in this new age of human machine interaction?
that is an agenda item in every company that we deal with her in -- with. how do i become more cloudlike? how do i automate my infrastructure to one that efficiently funds the digital transformation? then you have the work force transformation. i do i make sure the people of the company have the right tools that they can be productive and efficient and it's not about giving them the lowest cost thing possible. i want to retrain the high-quality workforce i have. productivity matters in the devices are important. the last one is dirty. -- security. we have a broad set of capabilities to help our customers defend and protect
their most critical information and data. this is about trust and assurance. nature ofticated these attacks is increasing. that's an incredible topic for our customers. we think we are unique in the capability we bring it ross the whole spectrum. that makes us highly relevant customers. that's why we are growing asked the industry. this hour, we bring you more from the conversation, including their strategy for fighting off the competition. amazon is building a fulfillment center in new york. it will be in staten island and create 2200 jobs. part of a push to house inventory closer to customers and enable fast delivery.
the company says employees will be able to work with the dance robotics. foron has begun the search a second headquarters in north america. they will spend $5 billion and add as many 50,000 jobs in coming up, was russian money being funneled to produce political ads on facebook? gopro is getting an optimistic outlook after its product line. about crowded space of action cameras and drones. this is bloomberg. ♪
contacted to 470 accounts run out of russia. it suggests russian money was used in violation of law to influence the american election. juneds were bought between and may of this year. base because the lead of the accounts and pages and is providing details to investigators. -- alked to this about sara: they are looking into information campaigns. they have this malicious they element to them. there are a lot of eight pages and they try to spread propaganda in one way or the other. thatort came out earlier detail that and linked it vaguely to russia. this says money was involved in a $100,000 may not sound like a lot of money, it can buy a lot
of this book advertising. that is more than 3000 ads purchased that were targeted to certain geographic regions. while most of the ads didn't name a candidate or talk specifically about voting, they did talk about divisive issues rightsbt writes and gun and race relations. spark or trying to whoever was trying to -- whether it was the government or other russian actors, they were trying to's art divisiveness in the election are in -- election. is there any idea who in russia was involved? is there any clarity on if they have ties to the government? sarah: facebook is not saying. everyone is looking into it.
there are several intelligence committees investigations into this. i think facebook is cooperating. they are trying to provide information where they can. they are trying to prevent this from happening in the future. they are looking at the patterns and matching it to algorithms and try to stop it room being a problem in future elections around the world. facebook is offering millions of dollars to major record labels and publishers for music rights. they would be able to have songs and videos they upload. facebook is a read to set up a system for tagging videos that infringe copyrights. it could take two years to establish that. gave the reaction. spent wants of trying to figure out how to
resolve this ongoing problem for you have millions of videos being loaded with music the can't either. facebook is trying to build a system. it will take so long, it would give rights holders millions of dollars to buy them off while they build the system. it is supposedly in collaboration to have all of the user generated videos. emily: this comes as they are rolling out a new hub for video. james: i think it's smart. they have the leverage so they can get the deal done. what they are doing is putting the money where their mouth is. they're going to spend a ton of money to people engaged. that's one of the primary reasons for the loading -- uploading videos. at the same time, they will
spend hundreds of millions of dollars for video content. ishink what they are showing the willingness to really be a contender and a player when it comes to digital content. emily: who does this with pressure on? lucas: the record industry hopes youtube. success, theyno have no leverage or it -- leverage. it does put some pressure on facebook figured out here in i think they are hoping the tighter they get bound together, the more seriously facebook will take the problems. it doesn't necessarily put pressure on anyone in the long term. this is just the next date -- step in facebook bigger net with her video strategy is. they also bid for the nfl
thursday night football and lost to amazon. they are dabbling it seems. james: they are making $100 million plus bids. facebook is the advantage to amazon. they have a virtually unlimited amount of cash. willingness,the the one thing facebook needs to be careful of his two not monetize too fast and make sure the get the aches rinse his right. -- spirit in's is right. it xperiences right or emily: they are going to charge
to consume. james: i think it's the right thing to do. i don't want them to russian. -- rush it. they did it so perfectly with instagram. people are still using messenger. i don't think they want inept advertising. it's great to monetize business relationships. they are facing pressure right now with the declining ads. they need to show growth. i hope is not being done as a reactive measure to market expectations versus actually turning on this biggest for monetization at the right time. emily: when it comes to twitter and snapchat, we know growth is struggling at of companies. do they stand a chance? james: i think twitter has a
chance to -- chance. they have a service that is indispensable with real-time information. know.outlets with snap, every day is going to get harder and harder. they are their worst enemy. they're not capitalizing on their course strength. facebook will spend money on content. if they win that apple, it's a losing proposition for snap. emily: when you are looking at rights to a specific franchise, is a zero sum game? if they are win willing to pay up? lucas: they could all win. his ecosystem big enough for them and the media guys who already have the right? putter head the nfl last year, but most people watch games on
cbs and nbc are in -- nbc. -- pull somelypso of those viewers away? how serious is the bid western mark i was surprised by the facebook bid for the rights. they did not want to spend a ton of money on rights. they were hoping to work out scenarios were they could share avenue -- revenue. they want to buy some the biggest right out there. we could see a more significant like ration of viewers from tv to these platforms. shaw.that was lucas it is a partial victory or intel as they battle the european union over a regulatory fine. the top court ruled that the lower court has to re-examine intel's appeal in the antitrust
case. they have continued a lengthy battle against the european commission did it could have ramik the nations for suits involving u.s. tech companies like google and apple. coming up, after struggling with the bottom line, gopro is inching toward profitability. we will hear from its seat -- eeo next. -- coo next. we will do a deep dive on the controversy over daca decision. this is bloomberg. ♪
emily: is looking to resurrect its smart phone program in india. they are marketing the mi a one phone in one of the largest emerging markets. they lost project in india three years ago. sales were lacking. for $234.went on sale it has a dual camera set up. gopro has been living on the edge. there is a shrinking consumer demand and the have seen sales plummet. they are on the road to profitability. we spoke to their chief operating officer about the turnaround efforts. >> one of the things that was not mentioned and we're most excited about, we are going to be profitable in q3.
that's a big development. margin, whato the is driving that is simple. it is the best product we have ever launched. we are seeing strong demand for. in addition to the differentiation we have in terms of voice control and waterproof and cloud connected, we have amazing software which is super differentiated. it allows consumers to move their content on their cameras to their phones automatically. we create video for the consumer automatic the and they can we get to their hearts delight. likes we've been talking about camerathe karma -- easier to use. what istion remains,
the proposition for the consumer that is perfectly happy? onyou look at the movement instagram and the content that phone doesn'tthe ,nable sufficient versatility immersive capture. is freeare trying to do are consumers from the capture experience and let them live the moment and the activity and capture that activity. on the other side, on the software side, we want sharing that content to be as easy as if you captured it on a phone. freeing our -- consumer to enjoy the moment and having the same convenience with a phone. atyou are looking
profitability. is this a sustained return to profitability beyond the end of the year? set a stretch goal at the beginning of the year to be profitable for 2017. we expect to see that. we expect to achieve double-digit revenue growth. we do expect to be profitable next year and more profitable in 2018. we brought in a number of cost measures in march. it took several months to get those. yearll have the full s.nefit of those cost-saving andxpect to expand margins reader profitability in 2018 area >> shares are down a third
over the year. there are neutral ratings on the stock. what are investors missing? >> i have been through a turnaround situation like this before. stock price always lags performance. we don't worry much about the stock. our job is to deliver amazing products work in sumer's and deliver an amazing work environment for our employees. , second first quarter quarter, and now the third order, in addition to meeting expectations for consumers and employees, we are meeting expectations for our investors. stock totime for the follow. we are confident we will continue to execute and that will come over time. >> you were at the global tech conference. what are the con --
conversations like? >> it's like different from months ago. there is a ricky missions it gopro -- recognition that gopro has a very strong foundational business. an untethered land to the smartphone. it's making that opportunity big. how much of the instagram content share can go? it has shifted from is the how big is theto opportunity ahead of us? that was the gopro coo. ceos blasted president trump this week over ending daca. we will hear from one startup speaking out next. all caps -- episodes are streaming on twitter. check us out.
so we need tablets installed... with the menu app ready to roll. in 12 weeks. yeah. ♪ ♪ the world of fast food is being changed by faster networks. ♪ ♪ data, applications, customer experience. ♪ ♪ which is why comcast business delivers consistent network performance and speed across all your locations. fast connections everywhere. that's how you outmaneuver.
♪ emily: "best of bloomberg technology welcome back to "best of bloomberg technology." on emily chang. after months of speculation, the trump administration made it official. the deferred action for childhood arrivals, daca, is ending. president trump explained the decision. president trump: i have a great heart for the folks we are talking about, and a love for them. people think in terms of children, but they are really young adults. i have a love for these people and hopefully now congress will be able to help them and do it properly. speaking to members of congress, they want to be able to do something and do it right. emily: the program allows people who entered the u.s. illegally as children to apply for
renewable two-year permits that shield them from deportation. those who fall into this category are known as dreamers. tech reaction was swift with leaders quick to offer their take. dreamersok tweeted " contributed to our community just as much as you and i. apple will fight for them to be treated as equals." " streamers are our neighbors, our friends, our coworkers. congress needs to defend daca." microsoft giants like intend to take legal action if their employees who are dreamers are deported and will find their employees' legal bills of necessary. the cato institute immigration policy analyst joined from washington to discuss. >> it really puts the employees in a state of legal limbo. but president trump and attorney general sessions said today is
that they want to kick this over to congress, give them six months to pass legislation that could in theory make these people have full legal status, just like they have had under the dream act or some other capacity. the reality is immigration reform has been a real hard sell in congress for several years. on its platea ton already when you think of at the debt limit and hurricane harvey and passing a budget and all those things. it is probably not something they were looking for. it adds to a full plate over the next six months. obama didx, president make a statement today. he said to target these people is wrong because i have done nothing wrong. let's be clear, the action taken today is not required legally. it is a political decision and a moral question. talk to us about that. is this a moral question. and not a legal issue? both.i think it can be
in terms of the moral dimension, to have people brought here as children under the age of 16. they did not make the decision themselves to come to the united states and break immigration laws. many in these cases have grown up here. many did not know they were illegal immigrants and deliver older. this is the only country they know. they are educationally and culturally american. about 80% of americans have sympathy for them and want to give them the ability to stay or a path to citizenship. these are people we can have a lot of sympathy for. in general we don't to punish people for the crimes of their parents. this is one of these cases where the american public is completely on the right side of this ethically, notwithstanding any of the legal issues. emily: president trump is saying it is time for congress to pass comprehensive immigration
reform. willie actually support it? -- will he actually supported? bill: the land which he used was very interesting. he has publicly agonized over this decision, even during the campaign he said it was something he would do on his first day in office. the language from attorney general jeff sessions was much harsher. he described people who have benefited under the dream act as illegal aliens. he said they have been taking jobs away from true citizens. that kind of terminology does not sound to most people's ears very compassionate. it raises the question of how much support people for behind a congressional effort. -- attorneyr general sessions said any kind of legalization should promise be put together with other proposals the
presidents want, like one that would cut legal immigration and half. including cutting skilled immigration by 100,000 a year. that is a nonstarter. that is dead on arrival. if congress is serious about passing away to legalize these people, they need to ignore the advice of the attorney general and put of a cleaning dream act without any other features or anything a popular like the raise act. mcconnell already weighing in on this. . let's listen to what yet is say senator mcconnell: he said president obama wrongly believes he has the authority to rewrite our immigration laws. today's action by president trump correct that fundamental mistake. this congress will continue working on securing our border and ensure lawful immigration that works." bill, what is next? bill: congress is just getting
back into town tonight. this was not the welcome present they were looking for. on the immediate horizon it is hard to see something getting done in the next few weeks. congress has to pass an increase in the debt limit, look at passing some sort of a budget or continuing resolution just a fund the government through the end of the year or the next fiscal year. you have hurricane harvey aide, and that is tied into all of that. you will have proposals coming up from bipartisan groups of senators and members of the house. i don't think we will get a real clear guidance on whether this is possible for quite a while. emily: nancy pelosi has been speaking with reporters. she mentioned attaching -- she does not think attaching daca to the debt ceiling is reality. alex, tell me more about what you expect when it comes to the actual legal fight these people and companies that employ them might now and up involved in? alex: it will be a vicious legal
fight. a lot of tech firms will be defending their employees. it speaks to the wider problem. a lot of these firms have a large number of foreign-born workers. they feel like they need to defend the dreamers, especially to show the rest of their employees and investors they are serious about protecting the various work force. deadline six month when in march 2018 the president's cancellation of daca will push 1000 dreamers a month off the work permits and into illegal economy. they will either be fired immediately or have to work illegally in the black market, 10t like in other million to 11 million immigrants in this country. it is not a soft deadline. this is one of the more pressing issues. this is more important than the other ones they've been talking about. there is broad agreement across the political spectrum that something needs to be done to
legalize these people and bring them out of the shadows so they can work lawfully in the united states. it is good for the economy, good ethically, and consistent with our traditions in this country. i think congress needs to get on it and solve this problem immediately because it is rare congress actually passes and reform in an election year of this magnitude. they really have three to four months to figure it out before becomes politically more desperate and toxic. president trump's swifton was met with does it on from the tech community. 13 of the top tech companies are collectively worth over $3 trillion, and employed within 1.5 million people last year. hadad. joined us -- andre
join us for his opinion. flee his native lebanon due to civil war. andrea; emily: what is your reaction to what the white house has done? andre: i am very disappointed. what is police that makes the -- i always had this belief that what makes the u.s. special is people can find her home. i think the moral of the u.s. for generations. it has also been part of the economic success of the u.s. our ability to attract talented people who are fleeing and deciding themselves to seek a better future somewhere else. it is exactly the sort of people that sure that dna with the entrepreneur who sees opportunity somewhere and build
a company, pursues the better future. i think that is part of the economic success story of the u.s. emily: the president says that's all great, but u.s. workers, u.s. jobs need to come first. immigrants are taking jobs from american workers. what do you have to say to that as someone who employees many immigrant workers? andre: i think that is a fallacy. when you look at the data you mentioned in your opening remarks, a lot of these immigrants that have been brought to the u.s. have created a lot of value. i'm sure it is not a zero-sum game. there is a lot of value created by the immigrants were building companies and link a lot of u.s. workers. the economy is not just about one job taken by another job. it is total value creation that talent brings to the country. emily: speaking of the value you have created, you just raise $92 billion. turo is a car sharing company.
tell us about how it works and how it differs from other rental car companies out there like get around or zip car. in the ridesharing businesslike uber or lyft. an airbnb for cars. we don't actually control our fleet. we enable people to share their cars on the platform. we have more than 800 makes and models today. everything from mercedes-benz to tesla to a smart car, and everything in the middle. it is very diverse. our 4e just elevated million user. focused on much enabling people to take long-duration trips with these cars. we are offering rentals by the day minimum. oure are travelers,
customers are booking cars by the week or weekends or several days. the average is four days. we enable our hosts who are sharing cars to return the car from a cost center that appreciates over time into a revenue-generating asset. that is one of the things that makes us really unique compared to traditional car businesses. emily: if you live in an area well served by uber and lyft, fire ant a car instead? andrea: they exist really well. turoost loyal customers at are people who have downsized under ownership and maybe using more frequently than average ridesharing services like lyft or uber. lyft and uber can be practical for your weekly commute needs or civil transportation needs from but if you want to get out of town for the weekend or
on a trip for several days, go to a place that may be special or you want a nice driving experience, you can read your neighbor's car. clear practical for people who live in city centers and he may not own a vehicle anymore. we became the preferred way for them to get out of town for the weekend. and airbnb are still dealing with a lot of regulatory issues. what are you dealing with? andre: insurance is part of the turo model. we provide coverage for a partner liberty mutual the join our fund raise. we are delighted about that. we provide insurance that covers both the host and the guests. insurance is a highly regulated industry. this notion of renting out your car and making money with your car is something that predates a lot of the car insurance laws. we are trying to help the
insurance at the system move forward and up -- ecosystem move forward. emily: when you look at the future of car transportation, how much of it is ridesharing, how much of it is car sharing, traditional car ownership, self driving cars? your business could change dramatically over the course of a decade given all the technological shifts happening. andre: we think a big part of car interest the rotation will be a mix of all of the above. 10 years from now when level five autonomy will be more close to reality and what it is today, we think autonomous vehicles will be amazing to share. it is so easy to be able to summon your car, had an eager guests and pick them up from the hotel and have them drive your car for a day or a weekend. that just makes sharing your car a lot easier. we think the future of autonomous cars is going to make
sharing as convenient as just hailing a car. u.s. lawmakers passed a bill the speed of the introduction of self driving cars. the house bill at the national highway traffic safety administration in charge of regulating cell driving car safety and preempt competing rules at the state level. manufacturers would eventually be a look to intercept process many as 100,000 self driving cars per year. the bill now moves to the senate where a bipartisan group of senators is working on their own competing piece of legislation. more from our exclusive conversation with michael dell. his thoughts and how the company fights office rivals next. if you like bloomberg news, check us out on the radio. you can listen on the bloomberg radio app, bloomberg.com and in the u.s. on sirius xm. this is bloomberg. ♪
♪ foxconn is emily: teaming up with apple in sharp to buy toshiba's memory chip division. it would give foxconn a 25% stake. the group is competing with two separate deals from -- each said to be about $19 billion. toshiba needs to raise the money by march to repair its balance sheet and avoid being delisted from the tokyo stock exchange. the massive dell merger is based on the fo's that bigger -- ethos that bigger is better. michael dell needed to help push back from rising demand from microsoft. they needed partnerships to woo dollars away and keep traditional competitors away.
i estimate about the strategy and if it is his goal to be the last and largest company left standing. michael dell: if you look at what going on in the world, i.t. businessng to b.t., technology. you can't actually do anything without technology. you can't sell anything, decant by anything, you can make anything -- you cannot buy anything, you cannot make anything, you can have customer relationships. government and society. i actually see the overall market when you consider the role technology is playing getting much larger. i go visit the largest industrial companies, the automotive companies, manufacturing, retail. they are thinking about how to use data in a very different way. applications are very important, but ultimately it is the data that drives a business. when you start to later on these
next-generation computer sciences, artificial intelligence, machine learning, data is the fuel for that. we store more than half the mission-critical data in the world. the amount of data is going to grow much much more in the next 30 years and it has in the last 30 years. it is doubling at a faster and faster pace because of all these connective nodes. 1 you are not fully --emily: again?ill you ever go public michael: we are very happy with her privately controlled structure. we have two public companies in the group. is working quite well. emily: we talked about m&a earlier. you said you would do a lot of m&a, but it has been fairly quiet. why is that? michael: we have done some m&a inside vmware. a little bit in dell mc.
we will continue to explore m&a. capital group is investing about one company a week in new businesses we are finding that are out 36-48 months in the future working on new things. wickeds also a consolidation going on an existing parts of i.t. we're using our supply chain, are scale, our portfolio and innovation to drive that in gaining share in that core as well. emily: are you more likely to invest in hardware or services when it comes m&a? michael: when you look at the things we are investing in, it is artificial intelligence, machine intelligence, next generation processor architectures to enable those new computing models. security.d how you enable the cloud native
apps, those kind of things. we are pretty good that hardware. iuing --ontin continuing to grind away so companies can render infrastructure. we have a massive engine internally and with our partners to help make sure we continue to gain share. emily: when you look at the competitive landscape, who can challenge dell more than it has? michael: we have no shortage of competitors. we are doing well relative to our competitors. i think the best way for us to plot our future is to listen to our customers. if we are going around following our competitors, that is not really a great strategy. emily: hpe, is is still arrival at once was? michael: they are not doing so hot these days.
that's a better question for them. we are clearly gaining share and they are clearly losing share. some of it is this portfolio affect. i think their innovation engine -- our innovation engine is on high. we are bigger than them in storage. customers ultimately will vote with their feet and dollars, and they are voting for dell technologies. emily: our exclusive interview with michael dell. pokemon go was a global phenomenon last year. the company has big plans to keep its fans. our interview with the ceo of pokemon next. this is bloomberg. ♪
ceo hits it big plans for the game. >> when we launched pokemon go last year, it was only 10% of what we wanted to achieve. we are working on crating the ability to swap pokemons, or being able to battle their peers. clearly covered 140 pokemon so far. with more than 800 figures, there is much more we can come up with. eugene: the switch has been out for more than half a year. what are your impressions of how it is doing and your impressions before he went out? nintendo switch would not be a success before he went on sale. i thought in the age of the smartphone know when we carry around a game console. it is obvious i was wrong. i came to realize the key to a successful game is quite simple. software with absolute quality leads sales of hardware. it can be football if the software is attractive enough.
it is popular among early adopters. denny's to be one more step to attract a wider audience. i see potential, but one cannot overestimate his potential. eugene: you mentioned strong software is the key to the system. i wanted to ask you about your upcoming game for switch. they cost a lot of excitement when it was announced in june. what else can you tell us about it? >> the pokemon games work well in handheld devices. we are developing games that work on switch. i can't give you details, at this stage vote we would like everyone to focus on altra s -- moon.sun and ultra we are providing different playing styles to our customers. there.pokemon go's ceo that does it for the best of bloomberg technology. we will bring you the latest in tech throughout the week.
so new touch screens... and biometrics. in 574 branches. all done by... yesterday. ♪ ♪ banks aren't just undergoing a face lift. they're undergoing a transformation. a data fueled, security driven shift in applications and customer experience. which is why comcast business delivers consistent network performance and speed across all your locations. hello, mr. deets. every branch running like headquarters. that's how you outmaneuver.
jonathan: welcome to "bloomberg businessweek." we are focusing on the technological advancements that are much closer than you think. we're talking about virtual assistants and brain controlled exoskeletons that in a year might be as commonplace as your smart phone. that's all right here ahead on "bloomberg businessweek." ♪ jonathan: we hear with editor in chief megan murphy to talk