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tv   Best of Bloomberg Technology  Bloomberg  March 16, 2019 11:00am-12:00pm EDT

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emily: i'm emily chang and this is "the best of bloomberg technology." bring you all of our top interviews from this week in tech. coming up criminal probe into , a facebook now includes a grand jury and an escalation -- an escalation of the investigation into data sharing. we cover the growing list of controversies surrounding the social network. and both sides of the aisle are taking up the issue of breaking up big tex, but breaking up is hard to do.
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we talk about washington's new agenda. and our wide-ranging conversation with tony blair on the global tech landscape. first, to our top story. the u.s. justice department has broadened its investigation to -- investigation into facebook including a grand jury, signaling an escalation in the ongoing federal probe. plus, sudden departures of top facebook executives. mark zuckerberg has announced that the chief product officer is leaving the company. zuckerberg made the statement, which he shared with employees. "for a few years, chris has been discussing, with me a desire to , do something else. he is one of the most out to people i know, and he has the potential to do anything he wants. after 2016, we realized had too much important work to do to improve our product and society and he stayed to help us work through these issues. at this point, we have made real progress." zuckerberg also announced the head of whatsapp is leaving as well. this is not the only issue they are facing.
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from noon wednesday into thursday, users were unable to access the social network and related services, globally. that includes instagram and into whatand whatsapp turned out to be a massive outage as federal investors launch a probe. thursday, we discussed all things facebook with techonomy founder and sarah frier. >> you may not have heard his name as much as zuckerberg or sheryl sandberg, but he is like the soul of facebook. he does the orientation for new employees every he is in charge monday. of all of the products. emily: he is in the inner circle. >> absolutely, but more than that, he created the newsfeed. he is the guy who is the face of this product internally. it is a big, jarring change for basic employees. emily: in his own statement,
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chris cox said that i have been sharing the message mark and i believe, social media history is not yet written and its tracks are not neutral. it is tied to the richness and complexity of social life, and as its builders, we must take up the work of defending it. -- of bending it toward the positive. he is clearly alluding to the big, existential issues facebook is facing now, but why do you think he is leaving? is he leaving because he fixed a lot of things or because he couldn't fix a lot of things? sarah: also in that post is another line that says they are entering this new era of product development that will be focused more on encryption, and apps that are connected and the messages are so private that not even facebook can see it. he says facebook's deserve executives take facebook into that era who are excited about that change. so he is hinting he is not excited. emily: let's talk about chris daniels, head of whatsapp leaving. zuckerberg said he is not filling chris cox's position, but he is elevating the heads of
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each of these products, whatsapp, facebook, messenger, and instagram. tell us about chris daniels. sarah: chris daniels was formerly head of, which was facebook -- zuckerberg's personal project try to get more people on the internet. it's sort of connected to whatsapp in that it was very international, but running a messaging product is a different ordeal. we don't know exactly why he left, but it is a very difficult time for whatsapp. they're facing all of the scrutiny from governments around the world. there have been whatsapp lynchings in india, of all of this misinformation that has spread on whatsapp that is encrypted, so facebook cannot do much about it. that would be a very difficult job to do. emily: david kirkpatrick is joining us now from new york. david, you wrote the book on facebook. i'm sure you interviewed chris cox several times. what do you make that he is no -- now leaving?
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david: i agree with everything sarah has said about his centrality of the company. he has, in my mind, been the person closest to zuckerberg from a product standpoint. which is why zuckerberg gave him oversight over facebook, instagram, and whatsapp. basically, he has been running all of the products. i also think it is interesting that he should be leaving and daniels, who runs whatsapp, leaving just a few days after zuckerberg declared whatsapp is the center of the new facebook. to me, it bespeaks some conflict and disagreement. how much is hard to say. clearly, someone like chris cox would not be leaving now with facebook so under fire just because he is tired after 13 years. that is not what would happen. emily: which reminds me that when zuckerberg released that
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memo about privacy, he talked about getting new leaders on board and the challenges of new board which was an allusion to them knowing that cox and perhaps daniels would be leaving. david: so many people have questioned the sincerity of that memo from last week, or the week before last, whatever it was, my time is missing. this actually suggests that zuckerberg is making a dramatic change and making it fairly fast. that is another possibility. maybe, itas saying, really could be that it is not in chris cox's wheelhouse. and he wants to leave. it is very shocking to me. to see those guys leaving at the same time. daniels is on the inner circle. emily: this is on the same day
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of this massive facebook global outage, believed to be the biggest outage they have ever had, which affected all of its services, and perhaps, is evidence of the power of facebook all being concentrated in one place, but also the difficulties of managing that. sarah: especially when you have these different services get more and more integrated. you have whatsapp, oculus, messenger, instagram, facebook itself. yesterday, they were all down, not to mention the ad managers. advertisers were telling me they could not see their campaigns and how they were running. it gave them the sense of is there really an alternative? emily: we were just showing the map of the outage there as of noon today, and facebook has said it has resolved the issues. there are a few hundred reports of people without service, but if you look at that map yesterday, it was red all over.
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heat map. david, do you think mark zuckerberg is planning to merge the infrastructure behind whatsapp, instagram, and facebook messenger. do you think this is an isolated incident or is it a symptom of a larger issue at play? david: facebook has said so little about what actually happens, we are left to guessing. one of the strangest things was that it was not just facebook, but instagram, parts of whatsapp, even oculus. that is extremely surprising to me, that they should have an architecture that, at the moment, would allow them to somehow be so connected that they could be simultaneously impaired. it does underscore the risks of making it all one big integrated system, which clearly is happening. emily: coming up, our exclusive and wide-ranging conversation with former u.k. prime minister tony blair, discussing the role
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of big tech on the global stage. and if you like bloomberg news, check us out on the radio. can listen on the bloomberg app,, and, in the u.s., sirius xm. this is bloomberg. ♪
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emily: this week, i caught up with the former u.k. prime minister, tony blair, about the role of tech in government as he wrapped up a tour of silicon valley. i started by asking him about an op-ed he wrote he said "populists of both left and right have risen to prominence. in their search for scapegoats to escape success tech is now firmly in their firing line." take a listen. tony: politicians exploit anxiety about the accelerated pace of change, these companies, people who run them, and they target the companies and they target the technology that is something that is going to disrupt and change our lives in ways we cannot control.
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it is basically about thing. my view is that this revolution is a fact, but in any event, it is essentially a good thing. we have to deal with its consequences. if it is handled in the right way, that could change our lives in good ways and can offer enormous opportunities. it is up to politics to address how we access those opportunities and mitigate the risks, because it will also displace jobs. emily: you said the first politician to master the tech revolution will decide the future. how so? tony: if i am right in saying this revolution is the 21st century equivalent of the 19 -- 19 century industrial revolution, if i'm right in saying that, then you look back on what the revolution did. it changed the way people lived and worked, the relationship between the countryside and the city. it changed the laws coming -- laws, changed politics, it
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changed everything. this will be the same. the first politicians to come along and understand it and make sense of it and show how this can form a narrative of the future that is essentially optimistic, those are the that ones will succeed politically. emily: democratic senator elizabeth warren has just proposed breaking up the biggest tech companies. google, facebook, apple, amazon. i assume you don't agree with her proposal, but what do you think? tony: i don't agree, but i think it is a really interesting speech. to be fair to her, it is a speech with an intellectual coherence to it, and what it shows is where i think the democratic platform may well go. and exactly the same issues are going on in the and europe. -- u.k. and europe. personally, i think a better way of dealing with it is to regulate them, having a regulator for these large tech companies. if you try to break them up, i'm not sure that really works. if you try to slice them up, you
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will find enormous difficult to do that. it's important to understand that one of the reasons these companies are so large is because they are offering a service people want. yes, there are huge questions that arise out of their dominance and power, but it is a better way to regulate this, in a way that has the public interest put into the mix when we look at these companies, in a sort of structured way, than think that if you cut them in three you will create greater competition. emily: what does that regulation look like to you? should the u.s. take the lead of the eu which has been pretty tough on big tech? tony: it is less about being tough or not tough, it is about working at the right thing to do. one of the other things we suggested is that it would be sensible, particularly given the huge competitive power in china, it would be sensible if europe and america worked together. emily: how so? tony: if you create a more level -- created a more level playing europe and asia,
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you give people the opportunity to develop technology of the future. it would allow these big companies to grow. i think it would be very sensible to have a transatlantic alliance on regulation of tech. the purpose of it should not be to hit them or be tough on them. the purpose should be to represent the public interest -- interest. obviously, there are public interest issues that come with us. the sensible thing rather than trying to break them up -- because i'm not even sure that would destroy the monopoly, you might find you have created three monopolies, not emily: are one. they a monopoly? tony: well, they are powerful. if you take facebook, google, amazon, they are incredibly powerful and will likely become more powerful. but a better way to do it is look at it in terms of how to be have the public interest. where i think elizabeth warren
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is right is that they are like utilities. they are utility platforms. the same way, when electricity and the water industry and other things were created in the 19th century, first in the private sector, in time, people said these are utilities everyone depends on so they will have to be publicly regulated. in some cases, people want them publicly owned. the point is, if they have got that amount of power, there will be a demand from the public that the public interest is taken into account. i think a better way of doing that is to have regulators that work with those companies, rather than break them up. emily: so, facebook, for example, multiple scandals, compromised the data of millions of people. mark zuckerberg has now said we will focus on privacy, private communications. is that enough? tony: i understand why and privacy is an issue, but
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the essential question for these tech companies is their power. they are powerful. if you look at their dominant positioning in advertising, or the role facebook inevitably plays in politics today what is , absurd is to say to them you have got to be responsible for everything that is happening. the truth is, it is a joint responsibility. we have a public interest in making sure they exercise their position responsibly, but we are going to also have to work with them to share the responsibility from the public policy point of view. many of these questions, whether it is hate speech or excitement, -- incitement, child pornography, radicalization, whatever it is, these are things where there is a public interest in sorting out, but that requires not just companies to behave responsibly, but government to be alongside the process of that and making sure it is done in the most effective way.
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emily: how can we trust the companies to understand and live up to their responsibilities? similarly, how can we trust government to not be mired in this political process as we see in both of the u.k. and the u.s. and do something? tony: this is a challenge, but in the end, the challenge is best addressed the concept of public interest regulation. whether you do that for each individual company, you might, because there are different issues that arise. for example, in relation to facebook, amazon, and google, different problems arise. but, this is the world we are living in. there is a bigger question them, -- question for them, for example, if you take driverless cars, the next generation of cars are likely to be electric, and in time, driverless. this will change employment, it will change transport, it is probably going to change insurance. it has got a massive series of implications. emily: that was my interview with former u.k. prime minister
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tony blair. , coming up, by 2025, india is set to be the world's third-largest economy. adventure -- and venture capital firms are anxious to get in on that growth. what trend is investors are seeing in the country's rising tech scene, next. plus, new court documents show larry page was worried that he would lose his controlled the company and delivered what one director called a veiled threat to quit. this is bloomberg. ♪
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emily: on monday, nvidia agreed to buy a chipmaker in his -- its largest purchased ever -- purchase ever. the deal for the manufacture is worth under $7 billion, and despite the size of the deal, it is still smaller than the top -- fourconductor deals semiconductor deals of all time. it is expected to help nvidia push into a market and meet the need for greater processing
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power. we heard reactions. >> to hear it from nvidia, data centers in the future will be not just a group of computers, they will be all one big computer. so the interconnects between those components become more important. emily: and you spoke to the ceo last night? >> right, and mellanox does all the connections. emily: there's a broader movement we are seeing in the chip sector. there was a wave of semiconductor stalling. they used to be the hottest name in m&a. companies tried to do some of the things last year, i'm sure you remember. deal thatnd the nxp fell apart. people are pushing big deals and they have been pushed back by regulatory concerns. as you said, it is a big number,
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but does not rank in those top five deals. emily: is this going to be subjected to regulatory scrutiny? >> if you look at the share price, there is a sign that people are concerned, particularly in china, that it will face that regulatory scrutiny. emily: elizabeth, in terms of what else could be in the pipeline, would you say we should be looking at smaller deals? >> this is a competitive process and there were other bidders until the end. we can assume they are looking for similar things. ian is the expert, but we know their is this sort of $1 billion to $5 billion company -- companies out there that are potential targets. emily: ian, what kind of chatter are you hearing? >> the logic has not changed. there are enough companies that are frankly just not big enough. the cost have gone up, they are
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they arenough -- but not big enough to stay competitive long-term. one analyst said that craig is in a similar position. there are a lot of companies that are arguing scale. emily: nvidia beat out intel, what does that signified? -- signify? >> it signifies they wanted more than intel did. it was not just intel, but a number of other countries were interested, which may have prompted the deal to be announced when it was, regardless of whether it will be an easy process in approval or not. emily: what else could be in the pipeline that you are watching? >> in terms of tech, the big thing we have got our eye on is ipos and a lot of those could go down the m&a route. intel was a name that lost out. maybe we look for them to do something different as an
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alternative. emily: india is coming online at exponential rate, growing from 200 to 500 million users in just three years, and investors are jumping at the opportunity to be part of that growth. lightspeed india partners has raised two new funds, and with six partners across its offices, it has become one of the largest team in india. a partner at lightspeed india joined us tuesday to talk about growth. >> we started investing in india at lightspeed about 12 years ago. as the opportunity opened up, we decided we would start dedicated funds for the region. as we saw mobile growth leading to the internet growth you spoke about. emily: the growth in india has been astounding. it's might be 700 million people online in 2020.
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how do you begin to assess the opportunities? are they just exploding or is it pretty obvious where you should be putting your money? >> feels like it. at the same time you have internet growth exploding, you now have a recycle of repeat entrepreneurs in the market for more of the scale companies and you have more and more risk capital available. you have the intersection of multiple different things happening, and i think what we are beginning to see and excited by is that technology is making its way into every industry. it could be commerce and retail, hospitality, one of our companies is doing a great job there, logistics, ridesharing, transportation, media. a lot of the things we see in other parts of the world, in other digital economies is beginning to happen in india. emily: big u.s. e-commerce
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companies like amazon and walmart have taken an interest. amazon has invested billions, walmart bought flip part in a -- flipkart in a big coup and a combined mystics and e-commerce. how has their arrival impacted your job? >> it is a net positive thing. for us as early investors, we want to build companies that ultimately will get public or some form of exit. the idea that there is downstream capital or strategic investors or buyers is a good thing. one of the things i often say is that india is an open market, so it is the world's next big digital economy. it is open, and that means capital and interest is coming in from all over the world. it could be the u.s. and u.s. strategics, chinese strategics, folks like naspers. there is capital flowing in from all parts of the world. i think that is good, provided it is ultimately used in the right way. up elizabeth , warren continues to target big tech. why she thinks breaking up tech
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giants could sustain competition, next. "bloomberg technology" is livestreaming on twitter. check us out @technology, and be sure to follow our global news network, @tictoc, on twitter. this is bloomberg. ♪
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♪ emily: welcome back to the "best of bloomberg technology." i am emily chang. democratic presidential hopeful senator elizabeth warren is going after big tech. after laying out a proposal to break up big tech, she took her arguments to the annual sxsw festival in austin, texas. she told an audience of many tech onto printers that -- entrepreneurs that breaking up companies like amazon and google would keep the marketplace competitive. sen. warren: the opportunity to do what you do best, to come up with a great idea and work your heart out to make it happen, to be able to compete on a level playing field is taken away by these platform giants. so my view is break those things
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apart, and we will have a more competitive, robust market. emily: bloomberg's editor todd giles and susan warren joined us on monday to discuss. todd: she put a lot of thought and time into this. there are a couple of different prongs, one of them very straightforward -- breakup big tech. break up some of these mergers. for example facebook bought , whatsapp. facebook bought instagram. she talked about amazon. she has a list of deals that she would take a closer look at. and she is invoking at&t back in the 1980's, some of the big trust busting cases in u.s. history. but there is also a more nuanced argument, and that is where when these companies start to operate like a platform, like utility, and they are also competing as a part of that platform, as platform participants, that is
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where she also is looking for some kind of way to separate out those businesses. for example, amazon. amazon is the case she keeps coming back to. amazon has created a huge marketplace for millions of sellers to peddle their wares, but amazon is also a competitor in there. amazon at selling its own batteries, its own baby wipes. todd: exactly. and i noticed she cited our colleague spencer. once amazon sees your product is starting to gain traction on its platform, gaining popularity, amazon has a way of creating its own white label version of that, and creates this competitive atmosphere for its marketplace participants. emily: she talked about amazon, facebook, google, and she added apple to this category. she said apple has to break apart from the app store. it has to be one or the other. either they run the platform or
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they plan the store, they do not get to do both at the same time. it is the same notion. todd: and you can imagine -- there has got to be an interim step, where maybe these proposals start gaining traction. and maybe, instead of a full breakup, you see a company like apple potentially getting out of some of the businesses where it is allegedly competing with app store participants. i mean, that could be an interim step. another interim step, for example, would be paying closer attention to the ways that facebook, for example, operates and spreads information, and maybe forcing them to be a bit more transparent about who is funding a particular advertisement, who is behind a particular piece of information that is being circulated around facebook. people have talked about treating facebook and google more like traditional media companies. so there are interim steps. emily: meantime, senator amy
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klobuchar who is also running for president said she wanted to see an investigation if breaking up tech companies is the best option. how are the other candidates received at sxsw by this tech savvy crowd? susan: i think all the candidates that i heard speak were very interested in seeing more regulation over the tech companies. none of them went as far as elizabeth warren in proposing a breakup, but they were open to studying this question, looking at what needed to be done, closer scrutiny at the mergers, maybe even a little bit of retrospective regulation of mergers was proposed. just overall, solving this problem that nobody anticipated having 30 years ago. emily: tom, have we heard a reaction from any of these tech company so far about this? tom: they are not saying a lot. emily: we know they are lobbying in washington. tom: they have good reason to lay low on this one.
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the fact that these proposals have come out this early in the campaign shows that this issue is not going away. emily: bloomberg's tom giles and susan warren. meantime, ads for warren's campaign making her case for -- taken down from facebook and were quickly restored. she tweeted -- curious why i think facebook has too much power? thanks for restoring my post, but i want a social media marketplace that is not dominated by a simple censor. she got an unlikely supporter in senator ted cruz, who retweeted warren, saying first time i ever retweeted elizabeth warren, but she is right, big tech should not be censoring warren or anyone else. a serious threat to our democracy. so what would a big tech breakup look like? the author of "zuck" joined us to wait in. roger: i really like what
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elizabeth warren is doing. first reachedhe out to tristan harris and me in the summer of 2017 with her early thoughts relative to what was going on in technology. and i was incredibly impressed by the insights that she had in comparing what was wrong in tech compared to what she had seen go wrong in the banking business, where, essentially, you had markets in which one side had vastly superior information and was able to control the information available to the other side and where people who made markets were also participating in them. when this came out, i have studied it very closely. i believe antitrust is essential in two different ways. first is, the big tech companies -- really, i am talking about google, facebook, amazon -- are blocking competition from startups in their immediate area. they are basically causing innovation to come to a stall in and around the core internet.
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they have been amazingly successful idea. i think that is a terrible idea. i want to end that. warren is very much on that issue and antitrust, it is a super progrowth way of doing that. starting in 1956 with the at&t consent degree through ibm, the second case, breakup of microsoft -- you have seen massive new industries created by using antitrust to stop the incumbent from dominating you spaces. i like -- dominating new spaces. i also like preventing companies that operate markets who are also participating. google and facebook do this in advertising. amazon does it in its market place. and i think that should stop. i think the cross subsidies and cost-sharing of data are also really, really bad. i believe warren's proposal is a first step down that, and i am
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supportive. and people point out that the history of tech was misinterpreted in some of the statements that came out. i really couldn't care less. the reason i couldn't care less is because i think the issues in tech, the power situation, the dominance of the public square, the manipulative technology that people are using, the surveillance that is now pervasive in our lives, that is just bad for society, and we should not allow that. new tech companies are a little bit like -- they are kind of like companies in the early 20th century, the robber barons, standard oil and jpmorgan. emily: i should point out that there is no real breakup threat under today's laws. under antitrust presidents -- precedence. lawmakers would have to get on side. do you see a better argument to breakup facebook or google or amazon or apple? which one of those four companies do you think presents the best case that serves elizabeth warren's arguments?
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roger: let us be clear -- this is a position. there is no guarantee we finish there. but you want to start with a position that says, we are going to do something really dramatic. we may be open to finishing somewhere else. and this is where i agree with both senator warren and senator klobuchar. i think both of these two really understand this issue. whether you break them up or not is less important to me than you prevent them from operating in ways that stall the economy. which is what we have going on. the threat of breaking them up is the way to get them to the table to have the conversation that we need to have. i want to be super clear about something. i am excited about the strides in the trump administration, particularly in the federal trade commission and the antitrust in the justice department. in my conversations with them, these are people that understand there is something really wrong with what is going on in tech now, and antitrust is the most
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progrowth way of dealing with that. and they are the antitrust tools in the regulatory toolbox, and both of them are doing things right now that are a big change from what we have seen in antitrust under the obama and bush administrations. so i look at this and -- i do not think this is going to be partisan. i think this is a right versus wrong issue, not a right versus left issue. emily: that said, facebook, amazon, apple, google, these are four different companies. yes, they are all tech companies with some overlapping businesses. but is anyone of these more a culprit than another? roger: google is by far the most effective at this. they had this insight in 2002 that, when they were trying to improve search, they would gather all the data, and they discovered they only needed 1% or 2% of the data, and they looked for what they could use the other 98% -- and they found they could predict behavior.
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then they do gmail to find out who these people are. with gmail, they can machine-read all the emails. which would tell you about people's behavior, because they would tell you in the email. then they wanted to know where people are, so they created google maps and started doing things like street view. then they do the satellite version of that. google glass. and now you have google home, so you are putting audio into everybody's houses. they are basically taking away all of our privacy, where privacy is defined as our ability to make choices without fear and without being exposed by others. but they are also taking away our pricing power. because they manage our access to information just as they manage the access of anybody who has something to sell, they manage their access to consumers. essentially, they are centralizing the whole economy in the hands of google, number one, then facebook, amazon, microsoft, and verizon. they are the five guys at the
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core of that strategy. and let's face it. it is a brilliant strategy. we just need to have a conversation as a country. why is it legal for corporations to own and trade our most private data? why are they allowed to buy and sell and trade our credit card transaction data, which they get from experian and equifax and trans union. why are cellular companies allowed to sell our location? why are health and wellness apps allowed to sell data that, if it were a hospital, they would not be allowed to sell? why are any internet companies allowed to sell our search history online? emily: does apple stand out to you from the rest? roger: a lot of what they do in china, i object to, but what they are doing in this area, they are fantastic. so the reason i have mixed feelings -- and i am kind of hoping there is a way for them
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to avoid the antitrust problem. is because i think apple is trying to be a good guy, and they have really succeeded. emily: roger mcnamee, cofounder of elevation partners and author of "zucked." coming up, larry page's quest for power. how he has fought to make sure he does not lose control of google, next. later, nasa wants to return astronauts to the moon, but it will need the private sector to get there. we will discuss the role of startups in the moon to mars program next. , this is bloomberg. ♪
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emily: nearly 21 years ago, larry page and sergey brin founded a small engine we now know as google. it has become one of the largest tech companies in the world. and with any company becoming public comes the threat of founders losing control, something a board member described as a "real concern" to page.
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in fact, according to confidential emails and other documents really -- recently unsealed in a court case, we know how badly page wanted to keep a grip. "why should i sacrifice and work so hard if i might not be in control?" that is what he told a former director. bloomberg tech's mark burgen weighed in. mark: in these court documents, we do not have larry speaking at all. there is a deposition from sergey, but at this time larry had just returned as ceo. so he was ceo in the beginning and then the board brought in eric schmidt. steve jobs asked him, what does it take to be a good ceo? he said, read all the books about being a good ceo. sergey is going into google x, the first days of google glass. we talked to people involved who said there was always tension,
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but it was a healthy tension. what these documents show is, at times, maybe it wasn't. and larry was concerned that sergey or eric would sell their shares. and and outside group would have control. emily: eric schmidt. so what the founders wanted was the creation of a new class of shares, of nonvoting shares. they are ready have these class b shares. 10 votes per share. and votes for regular shareholders, shares for regular shareholders had one vote. mark: in the initial plan, around christmas they said, we , will get it done in a few weeks. and the board pushed back and there was a push back and forth. and this lawsuit demonstrate or there was a much bigger push back then what people knew. emily: the board ultimately created a committee to look into whether these shares should be granted. what do you make of how google board handled this situation? >> i am impressed. pushing back against
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stockholders who have a controlling stake due to the dual class of stockholders is not easy. i was impressed that they pushed and larry explained what he was up to. after all, if you was merely concerned about ordinary delusion, they could avoid issuing stock, use cash for acquisitions, or push back. so they pushed hard on him. he essentially admitted that his main concerns seemed to be if sergey brin were to sell his stock, larry would lose his majority control. and he was concerned about that. issuing the c stock would solve that problem. if he could trade his c to sergey for the b, he could retain control, so the board and cover that and did a good job. emily: the board still decided to start this new class of no voting shares. why, despite these concerns?
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mark: john noris is a good example. he was against this for a long time. he originally was against the proposal. one deposition said he changed his mind and was convinced this is the best way to recruit talent. this has been a huge concern. google has been about recruiting the best talent. emily: so keeping them engaged would keep talent? mark: yeah. this is the year they make the big $12.5 billion acquisition of motorola. page had these big plans to see the fruition of alphabet, cars, biotech -- all the stuff that was not in google in 2011. and now these much grander moon shots and areas and moving into different fields that arguably could not have happened if the founders did not have such tight control of the company. emily: meantime, if you give founders these much power there , is always the risk of them making not great decisions. we have been covering another
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story out of google where page himself personally approved a $150 million payout package for andy rubin, the creator of android, who was it used of sexual harassment, and permitted him to leave quietly and invested into his new company. he also paid another executive $45 million, also accused of sexual misconduct. where was the board then? larry: if true, both of these examples show the downside to dual class. dual class theof founders envisioned a warrant under control. the downside is you sacrifice some accountability to shareholders. if it is true -- and i think it is disputed by the company and by the executive who was leaving -- that the ceo or the founding shareholder is able unilaterally
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to make that kind of decision, that is a downside to dual class. i cannot say the board has a lot of power in a situation like that, but it points out some of the negatives and some problems with managerial accountability with the dual class stock. and to the extent that sergey just was thinking about selling anyway, and larry faded in the background running the company, it is not obvious what their vision and their sense of the long-term interest of google and other stockholders is that warrants having disproportionate control. emily: bloomberg's mark bergen and george washington university's lawrence cunningham. still ahead, nasa is aiming to put astronauts back on the moon by 2024. how trump's 2020 budget requests support the lunar mission. this is bloomberg. ♪
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emily: nasa is speeding up its moon exploration. president trump delivered his 2020 budget proposal, requesting $21 million for the agency to find the program. the agency looks to transport humans back to the moon and eventually mars. and the private sector will be an important part of this exploration. space angels is a network of investors focused on early stage commercial space ventures. chad: the budget is out and it really emphasizes the moon over everything else. the administrator said clearly this is a stepping stone. the moon is seen as a staging area. it is a place for us to test out the technology that we need to go to mars. that is still the horizon goal, but the moon is much closer. it allows big wins early on and allows us to develop the
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technology we need to go to mars eventually. emily: is there anything we will learn from the moon itself that we do not know, as opposed to deep space exploration? which, arguably, there is more to know. chad: it allows us to test the technology that we are going to use to go to mars. so as investors in this space economy, it is important that nasa is going to be partnering with the private sector in a much bigger way. that was the highlight of the announcement today. there is a number of companies that are working to put a lunar gateway in the orbit of the moon that is going to allow us to do a number of different things. one, it is going to help develop the launch sector that will go out further beyond just lower orbit. it will allow us to develop the landing technology to go from orbit to the surface. in addition, there are a number of companies that are already working on technology that is being funded by clips, the commercial lunar payload
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program, $2.5 billion over the next 10 years. that is funding a number of small and medium-sized landers to go directly to the lunar surface. so this allows us to check out the landing technology and the technology to sustain a presence around another planetary body. in the moon acts as a fantastic launch point to go to other deeper space missions. the gravity on the moon is much less, so to launch from the moon to deep space is much easier. emily: we have not focused on spacex, which is working to get ting a human into space for the first time since nasa paused the space program. smaller are the other, companies, the are playing a critical role here, that we need to know about? chad: so there was $300 million set aside for the larger human landers. that is a type of thing that spacex and jeff bezos' blue
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origin are developing these landers to take humans. $2.5o get started, this billion from the clips program, that's is going to smaller companies. so astrobotic is privately funded and has been working with nasa and developing a relationship over a number of years, and is a key player in the clips program that will allow them to -- allow nasa to deliver a payload to the moon for the first time in a long time. that will be to test the capability and lay the infrastructure that will allow for a habitat on the surface of the moon, which looks very similar to, let's say, the space station as it is today, with a rotating crew of people that are there on a sustained basis, and we have a continuous human presence. emily: space angels' ceo chad anderson. that does it for this edition of "the best of bloomberg technology."
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