Speaker 1: From Mahard where Innovation of Money and Power Collie in
Speaker 1: Silicon Valley, NBN.
Speaker 2: This is Bloomberg Technology with Caroline Hyde and Ed Ludlow.
Speaker 3: I'm Caroline heard a Bloomberg's World headquarters in New York,
Speaker 3: Im Ed Ludlow in San Francisco.
Speaker 4: This is Bloomberg Technology coming up.
Speaker 3: Apple gets slapped with a one point eight billion euro
Speaker 3: fine by the EU. That's for abusing its dominant position
Speaker 3: the distribution of music streaming apps.
Speaker 5: Will bring you all the details.
Speaker 4: Plus AI's startup, Anthropic, is launching new versions of its
Speaker 4: chatbot Claude that are twice as likely to answer a
Speaker 4: question correctly. We discuss the launch with Anthropic president Daniella Amodi.
Speaker 3: An Amazon employees catch a glimpse into the future of
Speaker 3: work with humanoid robots as they enter their houses. Will
Speaker 3: go behind the scenes to the look at agility, robotics,
Speaker 3: two legged bot, name digit all that so much more
Speaker 3: coming up. Let's get into these markets, though, and look
Speaker 3: after fifteen records on the S and P five hundred,
Speaker 3: we just give up some of our gains and I
Speaker 3: chinlight what's happening with a nastag We're only off by
Speaker 3: a bad a tenth of percent, but notably, we are
Speaker 3: just having a little bit of caution after we digest
Speaker 3: a lot of the market run up that we've seen
Speaker 3: most broadly in AI stocks, in particular Gone Dragon index.
Speaker 3: I want to chinelight what's happening on Chinese stocks, Like
Speaker 3: the NBC is upon us, We're still not perhaps going
Speaker 3: to get the articulation of grand focus on growth and
Speaker 3: stimulation coming from China, and indeed, where is the press
Speaker 3: conference from the premiere That's not going to be happening
Speaker 3: this time. Some anxiety around Chinese stocks and we see
Speaker 3: that reflected in the US training of those names.
Speaker 5: I'm looking at the tenure yield just up three basis points.
Speaker 3: We look ahead to the jobs data that we get
Speaker 3: later in the week a little bit more fed speak,
Speaker 3: so all eyes on where we go in terms of
Speaker 3: the data. But we see bonds just training a little
Speaker 3: bit lower. What is not training lower, what continues to outperform,
Speaker 3: and of course thin liquidity on the weekend, and just
Speaker 3: to continue into a drive up today on Monday, trading
Speaker 3: five point seven percent.
Speaker 5: Higher in good old pitcoin.
Speaker 3: We are getting ever closer to that all important record
Speaker 3: level that we had a sixty nine thousand. We're currently
Speaker 3: at sixty six spot or to one, so keep an
Speaker 3: eye on that particular discusset ed what have you've gone
Speaker 3: on the micro Well.
Speaker 4: Another name that's pushing higher is in video. This is
Speaker 4: in Videa's market cap two point one three trillion dollars,
Speaker 4: the milestone that it reached Friday's close and into Mondays.
Speaker 4: It's now the world's third most valuable company by market
Speaker 4: cap on a dollar basis, jumping above Saudi Aramco. Will
Speaker 4: continue to track that. Maybe we can discuss it a
Speaker 4: little later.
Speaker 5: On the show.
Speaker 4: One other megacap the number two company in the world,
Speaker 4: Apple is moving to the downside. The stock down two
Speaker 4: point seven percent. That represents a drop of around eighty
Speaker 4: billion dollars in market cap in this session alone. At
Speaker 4: one point, the stockdown more than three percent, which would
Speaker 4: be a one hundred billion dollar market cap drop. This
Speaker 4: is not only the first EU anti trust fine that
Speaker 4: has been directed towards Apple. I think it's significantly bigger
Speaker 4: than we thought it was going to be one point
Speaker 4: eight billion euros two billion dollars, and it's all about
Speaker 4: market abuse in a music streaming context that Apple plans
Speaker 4: to appeal. They're going to push back on this, and
Speaker 4: I think we brace ourselves, Caro, for a lot of
Speaker 4: litigation to come.
Speaker 3: And of course we know who delivers those fines. Who
Speaker 3: continues to focus on big tech is the EU Competition
Speaker 3: chief Margaret Vesta.
Speaker 5: Let's just hear what she had to say about it.
Speaker 6: Today, the Commission has fined Apple one point eight four
Speaker 6: billion euros for abusing its dominant position on the market
Speaker 6: for the distribution of music streaming apps.
Speaker 3: Let's get over to Brussels where that news comes from.
Speaker 3: Lumberg's Oliver Krook is with us and Olie. What's interesting is, yes,
Speaker 3: the money, but when you're looking at Apple in terms
Speaker 3: of one hundreds of billions of god in cash, the
Speaker 3: money doesn't always matter. It's a precedent and it's also
Speaker 3: what changes in behavior that the EU is demanding.
Speaker 7: Right absolutely, I mean this is a much larger fine
Speaker 7: as ed was outlining that we had anticipated. I mean
Speaker 7: the reporting on this was five hundred million euros was expected.
Speaker 7: This is almost four times that, right, So there is
Speaker 7: a sort of a bit of a shock there, and
Speaker 7: it's all about abuse on the iOS, on the app,
Speaker 7: on what sort of apps and what kind of competition
Speaker 7: Apple was allowing to have from other people, And the
Speaker 7: EUS said, come out and said it plainly, how Apple
Speaker 7: acted was illegal. They've been doing it for ten years
Speaker 7: and they need to remedy this immediately. There is some
Speaker 7: doubt perhaps that this will be enough money to change behavior. However,
Speaker 7: again it's coming in quite above what everybody had anticipated,
Speaker 7: and Apple saying that they're going to appeal it that
Speaker 7: the regulators haven't proven because this is a market that
Speaker 7: has still grown. But Veslayer herself was saying that something
Speaker 7: like twenty percent of consumers who might have adopted Spotify
Speaker 7: did not get the chance to even see it. So
Speaker 7: this is really what's going to the crosshairs into a
Speaker 7: week where there's a major piece of legislation on tech
Speaker 7: regalization coming out of Brussels.
Speaker 4: We just showed Apple's response to the fine and the announcement.
Speaker 4: They gave a kind of pointed quote saying that in
Speaker 4: the context of competition, they feel that today's decision protects
Speaker 4: one clear European company which is a market leader in
Speaker 4: music streaming. They didn't name them, but they're talking about Spotify.
Speaker 4: What is what is the debate here Oliver. You have
Speaker 4: the EU saying one thing and Apple basically saying the opposite.
Speaker 7: Yeah, well, Apple's saying, how can you say we've had
Speaker 7: such an effect on this when Spotify has done amazingly well,
Speaker 7: has done a huge amount of growth and has not
Speaker 7: you know, has not really suffered by according to them.
Speaker 7: Of course, Spotify does not see things quite the same way.
Speaker 7: And Margaret Vesselayers had mentioned this in the press conference
Speaker 7: that she held earlier today, is saying that basically, you
Speaker 7: don't know how much more growth was available here potentially
Speaker 7: to Europe. So listen, you're going to hear this from Apple,
Speaker 7: You're going to hear this from from the United States,
Speaker 7: but here in Europe. I mean, they really want to
Speaker 7: stake their claim on being the regulators. And it comes
Speaker 7: again the Digital Markets Act, which will come into force
Speaker 7: on Thursday.
Speaker 3: Think about it.
Speaker 7: We're talking about one company, the app store and dealing
Speaker 7: with music streaming. Starting this Thursday, you have major tech
Speaker 7: companies that are going to be the touched by regulation
Speaker 7: that is trying to deal with all of this kind
Speaker 7: of competition in a major way. And that's not just
Speaker 7: in the app Store, and it's not just with these
Speaker 7: sort of apps. It is all encompassing these and they
Speaker 7: really want to set a strong message that you need
Speaker 7: to comply and that they are serious and that they
Speaker 7: are here for business. I mean, listen, when you look
Speaker 7: at this actual this actual fine one point eight four billion, right,
Speaker 7: they broke this down. When you look at the arithmetic,
Speaker 7: it's quite interesting. One point eight four billion. One point
Speaker 7: eight of that is a lump sum that was put
Speaker 7: on top specifically because it was Apple and why because
Speaker 7: it correlates to their annual revenue zero point five percent.
Speaker 7: So this is the EU saying that they're here and
Speaker 7: they're here for business.
Speaker 2: All right.
Speaker 4: Bloomberg's Oliver Kirkout and Brussels across one of the top stories,
Speaker 4: and tune in tomorrow when Oliver will sit down for
Speaker 4: an interview with EU Executive Vice President Margreta Vesta. Coming
Speaker 4: up on this program, we're going to talk about reddits IPO,
Speaker 4: artificial intelligence, this collapse of Silicon Valley Bank, a big,
Speaker 4: big and broad conversation coming up with Citizens Financial Group
Speaker 4: chair and CEO Bruce ben Sorn. Caroline, I see some
Speaker 4: breaking news in the airlines.
Speaker 3: Yeah, KiB an eye on Boeing in particular. This is
Speaker 3: a big breakthrough for them. American Airlines is indeed going
Speaker 3: to be agreeing to buy two hundred and sixty new
Speaker 3: short haul aircraft from Boeing, includes well eighty five Boeing
Speaker 3: seven three seven Max tens.
Speaker 5: That's a key endorsement. Therefore for the Plaine makecraft.
Speaker 3: Well, we know January's near catastrophic incident on the airborne
Speaker 3: Alaska Airlines flight currently up two point three percent on
Speaker 3: American Airlines. Boeing still off by some three tenths of
Speaker 3: a percent, So eighty five we're going to be seeing
Speaker 3: Boeing Max ten aircraft and eighty five A three twenty
Speaker 3: neo planes some air bus so look actually they're still
Speaker 3: a ninety embry SAA E one hundred and seventy five
Speaker 3: regional jets too. So American Airlines is spreading the love,
Speaker 3: but it is giving a eighty five endorsement.
Speaker 5: To Boeing Max ten aircraft.
Speaker 3: There's a broombt tech energy cash flow management.
Speaker 5: It's not always the sexiest.
Speaker 3: But it's important and actually AI has a role in
Speaker 3: terms of the sol here. JP Morgan's cashflow management tool
Speaker 3: that runs on artificial intelligence helped some of its corporate
Speaker 3: customers get their slash manual work, but almost ninety percent
Speaker 3: since launching about a year ago, JP Morgan's wholesale payments
Speaker 3: unit now has about twenty five hundred clients using the product.
Speaker 3: And this follows other key banks, other lenders that have
Speaker 3: been stepping up their use of artificial intelligence with the
Speaker 3: aim of guess what, lifting productivity, reducing cost.
Speaker 4: Said. One of those banks is Citizens. Let's talk more
Speaker 4: about that with Bruce Van Sawn, chair and CEO Citizens
Speaker 4: Financial Group, who's in town for the Citizens JMP Tech
Speaker 4: conference that kicks off today in San Francisco. So, JP
Speaker 4: Morgan has this idea that they wanted to add a
Speaker 4: billion dollars of value and then the upgraded it to
Speaker 4: one point five billion this year because of the work
Speaker 4: they're doing in AI. Do you have a similar goal
Speaker 4: in house that you're working on.
Speaker 8: Well, maybe there's a less one less zero on some
Speaker 8: of these numbers us versus them size wise, but clearly
Speaker 8: that we have a similar product called cash Flow Essentials,
Speaker 8: which helps small business forecasts through cash flows, and we're
Speaker 8: rolling that out this year and we have great expectations
Speaker 8: for it.
Speaker 4: You come to town three years after to basically getting your
Speaker 4: tech vertical set up through JMP. Is there one clear
Speaker 4: ambition you have for this week that you think you
Speaker 4: know in the conversations you'll have, and I know these
Speaker 4: kinds of events, there's a bit of deal making that
Speaker 4: goes on in the corridors as well.
Speaker 7: Absolutely.
Speaker 6: So.
Speaker 8: We have well over one hundred companies presenting, both private
Speaker 8: companies and public companies. We have several hundred investors attending.
Speaker 8: So there's a lot of buzz about this conference, and
Speaker 8: I think it's staged at a very good time where
Speaker 8: the markets are starting to look more promising. We're seeing
Speaker 8: some green shoots around IPOs, which is terrific, and I
Speaker 8: think just looking at the US economy and how tech
Speaker 8: is powering all industries and how AI has huge potential
Speaker 8: going forward, it's a really good time to have people
Speaker 8: get together and exchange their thoughts on that.
Speaker 4: Let's jump in on the IPO situation then read it
Speaker 4: is an important one for you. It's one that we're
Speaker 4: talking a lot about on the show at the moment.
Speaker 4: Just explain how that came about.
Speaker 8: Well, I think we had a long relationship with them,
Speaker 8: and so we're going to be one of the co
Speaker 8: managers on the transaction and so they haven't filed yet,
Speaker 8: but I think there's a huge amount of interest. It's
Speaker 8: a great company.
Speaker 3: Let's talk about whether or not that then spurs more
Speaker 3: green shoots. As you said, you can't have just one
Speaker 3: deal for green shoots in plural.
Speaker 5: Are we likely to see.
Speaker 3: A reopening because at the end of twenty twenty three, look,
Speaker 3: I'm now really outperforming where it originally listed at. But
Speaker 3: instacart queries over that one clave Yeo has done well.
Speaker 3: But we all thought this was the reopening and then
Speaker 3: it shut again.
Speaker 8: Yeah, it's been required some patients the last couple of years.
Speaker 8: So when we acquired JMP, it was the fourth quarter
Speaker 8: of twenty one, and the markets were red hot at
Speaker 8: that point, and so as rates went up and the
Speaker 8: economy wobbled a little bit, I think that basically cut
Speaker 8: the interest a little bit in IPOs. But again, I
Speaker 8: think this year is the year when we're going to
Speaker 8: see a breakthrough.
Speaker 3: Do the breakthroughs have to talk up artificial intelligence, the
Speaker 3: data that can be leaned on, for example, within Reddit,
Speaker 3: the areas of expertise that they're in different adjacent industry groups.
Speaker 8: I think it can be broad I think AI is
Speaker 8: certainly top of mind for the market, but there's plenty
Speaker 8: of great companies around security, different technology services that I
Speaker 8: think also it's going to see a lot of growth.
Speaker 8: So that's what the market ultimately focuses on, is what's
Speaker 8: the growth trajectory, And so I think that extends beyond just.
Speaker 3: AI, and let's talk about your growth trajectory with citizens
Speaker 3: Financial and ultimately how the market is supporting other regional
Speaker 3: lenders and banks such as yourself, because it is but
Speaker 3: a year almost ago that we were in the CrOx
Speaker 3: of the anxiety when it came to regional lenders here
Speaker 3: in the United States, the explosion of Silicon Valley Bank
Speaker 3: and ultimately some of the other spillover effects. Yourself managed
Speaker 3: to whether that storm had different business models in place,
Speaker 3: but your share price is still under pressure, and there's
Speaker 3: still anxiety around commercial real estate, for example, which we
Speaker 3: see front and center with New York Community Bank Corp.
Speaker 3: How are you seeing love green shoots appreciation of your
Speaker 3: business at the moment.
Speaker 8: Yeah, So I think last year was a challenging year
Speaker 8: for sure, with the idiosyncratic bank failures. Things have stabilized
Speaker 8: since then. Certainly, the deposit position is very strong. We
Speaker 8: have a very strong capital position. So last year we've
Speaker 8: spent a lot of time focused on defense and making
Speaker 8: sure our balance sheet was solid, put away plenty of
Speaker 8: reserves for areas real estate, which we think those losses
Speaker 8: will be manageable for us. But you know, we always
Speaker 8: talk about you can't just win playing defense, you got
Speaker 8: to play offense as well. So we have some great initiatives.
Speaker 8: We have the Citizens Private Bank, where we lifted out
Speaker 8: a bunch of folks from JP Morgan. We're committed to
Speaker 8: this region here in northern California. We have JMP and
Speaker 8: now we came in over the top with the Private bank,
Speaker 8: world class best in breed bankers. So we're connected to
Speaker 8: the whole innovation economy, the VC world, the PE world,
Speaker 8: all the folks who are creating lots of wealth here.
Speaker 8: So excited by that. We also have a big effort
Speaker 8: going on in New York, where we had acquired two
Speaker 8: bank franchises a couple of years back, and we're making
Speaker 8: great inroads in that New York market. And then I
Speaker 8: would say the third thing that we're high on is
Speaker 8: just our ability to serve private capital around the country.
Speaker 8: So we built out M and a capability sponsored coverage capability,
Speaker 8: and so we're really anticipating when private capital really kicks in.
Speaker 8: I think you'll start to see more deal flow in Pe.
Speaker 8: Certainly our pipelines are looking very strong for the year.
Speaker 4: The lesson that I learned out of what happened a
Speaker 4: year ago Silicon Valley Bank is how concentrated the access
Speaker 4: to working capital was for technology companies SMEs. Essentially, what
Speaker 4: was your big takeaway? What was the one lesson or
Speaker 4: permanent change of the last twelve months resulting from that saga?
Speaker 8: Well, I think people were a bit envious about how
Speaker 8: Silicon Valley Bank had locked in a lot of that
Speaker 8: customer base, and First Republic also, So now the demise
Speaker 8: of both of those banks creates a real opportunity for folks.
Speaker 8: There's avoid there and so it's all about talent and
Speaker 8: it's about commitment. It's about strength of offerings and capabilities.
Speaker 8: And so we're marching right in to help fill that void.
Speaker 3: And you'll be hearing from some of those businesses, those
Speaker 3: sectors you're shining a light on at your event this week.
Speaker 3: We thank you so much. Please, friends on Chair, CEO, Citizens,
Speaker 3: Financial or group, let's just return to look at the
Speaker 3: Elon Musk lawsuit against open ai filed last week and
Speaker 3: as the company violated its founding mission, putting profit ahead
Speaker 3: of benefiting humanity, VC community weighing in and treeson and
Speaker 3: of course for Kostla that we saw over the weekend.
Speaker 5: But let's get a legal perspective for you.
Speaker 3: Christina Garnia is with US technology lawyer over at Jeffer Mangels,
Speaker 3: Butler and Mitchell, whose practice focuses on technology transactions, on
Speaker 3: intellectual property and a whole raft of areas that have
Speaker 3: caught the technology sphere and its focus. But Christina, is
Speaker 3: this some sort of distraction, as a coastal would say
Speaker 3: at the moment, these sorts of lebal implications of open ai,
Speaker 3: or will they force some sort of transparency as to
Speaker 3: whether or not artificial intelligence should be being grown in
Speaker 3: a closed environment or indeed an open one.
Speaker 9: So I think the complaint is really interesting because it
Speaker 9: really is setting out this framing of you know, open
Speaker 9: ai was open source and it was nonprofit, and so
Speaker 9: you know that was sort of this thing that helped
Speaker 9: it to grow and to thrive, and you know, this
Speaker 9: is not happening in a vacuum. There's a lot of
Speaker 9: history between the parties, but this is really about you know,
Speaker 9: open source and nonprofit and you see across the technology
Speaker 9: space over the years, a lot of very interesting technologies
Speaker 9: came from the nonprofit space and remained open source. And
Speaker 9: the value of that has been that if there are
Speaker 9: issues with the technology and there's things that need to
Speaker 9: be fixed, you have researchers, academics and technologists who have
Speaker 9: access to it. And so you know, this idea that
Speaker 9: now it is for profit, commercialized and sort of deviated
Speaker 9: from the original mission of what open ai was supposed
Speaker 9: to be, you know, present some really interesting issues and
Speaker 9: you know, again, this isn't happening in a vacuum. So
Speaker 9: you know, there are regulators across the globe who are
Speaker 9: looking at AI technologies right now. So this, you know,
Speaker 9: the themes of this lawsuit sort of feed into that
Speaker 9: concern about the stewardship of the technology. So one of
Speaker 9: the interesting things and the complaint is that you know,
Speaker 9: the board itself of open ai started out as this
Speaker 9: depth of knowledge of AI technologies, and one of the
Speaker 9: allegations in the complaint is that the new board doesn't
Speaker 9: have that depth of knowledge, and so there's this larger
Speaker 9: stewardship question. I think that you know, the general consumer
Speaker 9: public AI is still very new, right, many people chat
Speaker 9: EBT is there, you know.
Speaker 4: Touch stown now with h le le let's just hit
Speaker 4: let's just hit the brakes a second. That you are
Speaker 4: an experience, experienced technology lawyer. But for loads of people,
Speaker 4: I don't think anyone really understands that the root of
Speaker 4: MUSK is the plaintiff's complaint here. So he's saying it
Speaker 4: started as a nonprofit for the betterment of humanity, and
Speaker 4: now he's saying that's not the case. But what legal
Speaker 4: grounds does MUSK have, if any, to make that complaint
Speaker 4: and what is it that he's trying to change.
Speaker 9: So he's bringing a breach of contract claim. That's that's
Speaker 9: basically the basis of the lawsuit. You know, I don't
Speaker 9: know what grounds there necessarily are. The complaint is really
Speaker 9: around this framing that the articles of incorporation as well
Speaker 9: as communications over the years form the basis of a
Speaker 9: founding agreement and that there's been a violation of that agreement.
Speaker 9: But you know, this was just filed last Thursday. I
Speaker 9: think there are some issues as to whether or not
Speaker 9: there're standing in the case, and so that'll be something
Speaker 9: that we remain to be seen as a case progresses.
Speaker 9: The other thing that you know, this case could also
Speaker 9: be this lawsuit filing could be is a device to
Speaker 9: get information. Again, the parties have a long history, and
Speaker 9: if the case were to move forward and survive in
Speaker 9: motion to dismissed for example, you know, discovery could you know,
Speaker 9: give the parties access to information they normally wouldn't have.
Speaker 9: So I think it remains to be seen if this
Speaker 9: suit really is a betterment of humanity, open source lawsuit
Speaker 9: for the good of AI and for the stewardship of AI,
Speaker 9: or whether or not, you know, this was a device
Speaker 9: to get information.
Speaker 5: So you know, we'll see what happens over the next
Speaker 5: couple of weeks.
Speaker 3: Yeah, have we ever seen have you ever acted on
Speaker 3: legal arguments that take issue with the fact that ultimately
Speaker 3: a company completely pivoted and whether or not it's a
Speaker 3: pivot of business model application or whether it's that you
Speaker 3: were not for profit and then you became for profit.
Speaker 5: Have we got any precedents so that sort of thing, There's.
Speaker 9: Not a lot of precedence in the space. You know,
Speaker 9: many technologies that start as nonprofit do remain so. But
Speaker 9: I think part of this is transparency. I think that
Speaker 9: you know, throughout the complaint there's reference to just the
Speaker 9: transparency in the process, the transparency and the transition between
Speaker 9: this nonprofit, open source model and what we're finding today.
Speaker 9: So a lot of this comes back to things that
Speaker 9: you know, have been well tread ground over the last
Speaker 9: you know, year or so in terms of just the
Speaker 9: transparency and open AI and the communications coming out of
Speaker 9: the company. But again, I think that you know, this
Speaker 9: does bring up some really interesting and timely themes around
Speaker 9: stewardship of AI generally.
Speaker 4: Christina Ganne, partner at Jeffer Mangles Butler Mature, We're really
Speaker 4: grateful for you expertise and we will continue to track
Speaker 4: that case and suit. Let's get back to Reddit's IPO.
Speaker 4: The company is seeking a six point five billion dollar valuation,
Speaker 4: that's according to Bloomberg sources, and we're bring boombogs Katie
Speaker 4: Ruth on the deal's team. We're kind of jumping around
Speaker 4: a bit here, right the last private round ten billion,
Speaker 4: then the reporting was the IPO might target five billion.
Speaker 4: We're kind of up to six point five billion. What
Speaker 4: else do we know, sure.
Speaker 1: And so you know this happens because it can be
Speaker 1: hard to guess exactly where the market is going to
Speaker 1: be when Reddit debuts, likely later this month.
Speaker 5: But yeah, so they were valued about.
Speaker 1: Ten billion in twenty twenty one, but that was also
Speaker 1: the peak of the tech private tech market, and so
Speaker 1: you know, many companies are expecting that they will be
Speaker 1: valued less when they go public. Yes, we had heard,
Speaker 1: you know, early talks had them valued around five billion,
Speaker 1: but it's now looking like ahead of the road show,
Speaker 1: bankers think they can get six point five billion for it.
Speaker 1: But sometimes these things, you know, raise or even lower
Speaker 1: during the road show, depending on how demand looks from
Speaker 1: the institutional investors.
Speaker 3: And it is it institutional investors that are going to
Speaker 3: be the mainstay for a name, right Reddit, A lot
Speaker 3: of this is going to be trading on well, the
Speaker 3: exuberants from retail too.
Speaker 5: I mean, it's a key retail name in so many ways.
Speaker 1: Sure, I'm sure Reddit would love to have both kinds
Speaker 1: of investors, but you know, bankers really target these large
Speaker 1: institutional investors to try to hold the stock because they
Speaker 1: need large anchors that they can trust, will you know,
Speaker 1: keep the stock for a while. So during this road show,
Speaker 1: they're going to market reddit to these investors, try to
Speaker 1: get a sense of how much demand is there and
Speaker 1: then set the price accordingly.
Speaker 3: We keep an eye on all those discussions on price points,
Speaker 3: Katie Roof. We thank you for keeping ourselves feed on it.
Speaker 4: Welcome back to Bloomberg Technology, Ed Ludlow here in San Francisco.
Speaker 3: And Parentline had in New York. Let's get you a
Speaker 3: check on these markets. Because little bit of give in
Speaker 3: the overall perspective of Dastak and the S and P
Speaker 3: five hundred, we'd had what fifteen record highs the S
Speaker 3: and P five hundred. We're just taking a little bit
Speaker 3: of money off with a little bit of calmness ahead
Speaker 3: of the jobs data later this week, and of course
Speaker 3: we continue to build the narrative coming from the federals
Speaker 3: of now's like one hundred off by two.
Speaker 5: Tens of percent.
Speaker 3: Let's call it SMP five hundred down about ten per percent.
Speaker 3: As I say, fifteen record highs had been hit. I'm
Speaker 3: looking at bitcoin. Note no give up there in that
Speaker 3: particular run up in the asset type, we're up five
Speaker 3: point seven percent, sixty six thousand dollars handle. We continue
Speaker 3: to push towards that all time high of sixty nine
Speaker 3: thousand hit all the way back in November twenty twenty one.
Speaker 3: Move on and have a look at some of the
Speaker 3: individual movers that we're keeping a niner eye on, because
Speaker 3: Apple is down two point seven percent that this is
Speaker 3: a big hit of course to the overall benchmarks.
Speaker 5: Just still one of the Magnificent seven.
Speaker 3: And we have seen Apple giving away significant amount of
Speaker 3: market value since not that really the start of the year.
Speaker 3: We're questioning, of course, some of the sales that are
Speaker 3: going on at the moment, and of course we continue
Speaker 3: to see some of the overall downward trajectory of Apple
Speaker 3: and how it's really split apart from the SMP five
Speaker 3: hundred and some of the weakness that we see from China.
Speaker 3: Let's look at the weakness that we see from China
Speaker 3: when it comes.
Speaker 5: To Tesra as well. That's been some of the narrative today.
Speaker 3: We're off by six percent, one of the key movers
Speaker 3: in terms of points on the NASAC overall, as we
Speaker 3: think about the supply chain over there and indeed demand,
Speaker 3: I'm looking at what's happening though on some that higher side.
Speaker 5: This is a company that is.
Speaker 3: Finally, because of its rampant growth, the AI Bullishness has
Speaker 3: been entered into the s and P five hundred index
Speaker 3: mark twenty four percent on the day. We know it
Speaker 3: is a hugely volatile name, but keeping an eye on
Speaker 3: the super microcomputer, ED, what have you got.
Speaker 4: Let's talk a little bit more about Aianthropic today, debuting
Speaker 4: three new AI models from its Clawed three model family, Haiku, Sonnet,
Speaker 4: and opus Or, offering increasingly powerful performance allowing users to
Speaker 4: select the optimal balance of intelligence, speed and cost for
Speaker 4: their specific application. I'm delighted to say that, Dennie Lamday,
Speaker 4: president and co founder of om Fropic, here on set
Speaker 4: in San Francisco, you're saying these models are twice as
Speaker 4: likely to answer a question correctly?
Speaker 8: What do we mean by that?
Speaker 10: So, first of all, Ed, thank you so much for
Speaker 10: having me on the program today. We are very excited
Speaker 10: to be announcing this new model family of Claude three.
Speaker 5: And really, when you say you.
Speaker 10: Know, twice as likely to answer you know correctly what
Speaker 10: that means is how high or how likely is it that.
Speaker 5: One of these models was sort of make something up?
Speaker 10: And so in addition to making these kind of intelligence
Speaker 10: advances really across all three models. We've also been working
Speaker 10: on many of the common challenges that businesses and in
Speaker 10: particular enterprises face when integrating generative AI into their businesses
Speaker 10: and workflow.
Speaker 4: One computer scientist reached out to me and said, oh,
Speaker 4: I've never used Claude, but I'm impressed by the testing scores,
Speaker 4: but also impressed by the fact that it's available straight away.
Speaker 4: And I also note that Amazon Aws came out very
Speaker 4: quick to say go to Bedrock, you can use it
Speaker 4: right now. Bedrock's been a real success for you guys
Speaker 4: in commercial commercializing the underlying models. Just explain the rollout
Speaker 4: and how you're able to do this immediately.
Speaker 10: So what's being offered today? So you mentioned those those
Speaker 10: three models in the family. So Claude three Opus is
Speaker 10: really our most powerful state of the art model. Claud
Speaker 10: three Sonnet is that middle model that is still incredibly
Speaker 10: capable and quite price competitive, particularly for its intelligence class,
Speaker 10: and very fast. And then Claude three Haiku is the
Speaker 10: kind of fastest model really really great for sort of
Speaker 10: you know, any type of US case that requires a
Speaker 10: quick response. And so today what's available in our API
Speaker 10: is Claude Opus and Claude Sonnet. So the bigger two
Speaker 10: models Claude three Hiku will be rolled out in the
Speaker 10: coming weeks, and then on AWS Bedrock you can access
Speaker 10: cloud son it that middle model today and also on
Speaker 10: GCP Vertex in private preview you can also access clouds
Speaker 10: on it. And I'd be remiss to not mention claud
Speaker 10: Ai our consumer consumer product, you can access clouds on
Speaker 10: it for free and claud Opis is available for our
Speaker 10: pro users as well.
Speaker 3: But Daniel, what's been interesting about the focus that you've
Speaker 3: had at Anthropic is on the commercial use, is on
Speaker 3: the business case use, and I'm interested it isn't Opus
Speaker 3: is relatively expensive compared to some of the competitors out there.
Speaker 5: What is what your client base drawn to.
Speaker 3: Is it still the focus on safety, which was first
Speaker 3: and foremost, or what else are you winning them on
Speaker 3: over the competition.
Speaker 10: So, really, the kind of reasoning behind why we did
Speaker 10: this model family was we wanted to give, you know,
Speaker 10: enterprise businesses as much choice as possible to really be
Speaker 10: able to toggle between what is the most important kind
Speaker 10: of element for their business or even in particular for
Speaker 10: their use cases. We anticipate some of our customers may
Speaker 10: use you know, multiple models just for different applications. So
Speaker 10: you know, Claude three Opus is really a great choice
Speaker 10: if you're if you need the kind of most powerful
Speaker 10: state of the art model for very complex reasoning. And
Speaker 10: I also, you know, should say so much of our
Speaker 10: enterprise kind of strategy has been around building these models
Speaker 10: and making them increasingly more intelligent and fast, but really
Speaker 10: also ensuring that throughout we are prioritizing reliability and trustworthiness.
Speaker 10: So many of the businesses that we build on that
Speaker 10: build on Claude, you know, really require a deep amount
Speaker 10: of trust with the customers that they're ultimately building for.
Speaker 10: And that's really been kind of a guiding factor for
Speaker 10: us as we have been training these models for our customers.
Speaker 3: And that goes straight to the heart of some of
Speaker 3: the difficulties that have consumed your competitors and just general
Speaker 3: adoption of AI within the landscape from a regulative perspective
Speaker 3: and a consuming use point, I think of, yeah, the
Speaker 3: image generation part of the equation right now, we all
Speaker 3: look to what's happening with Gemini and the fact that
Speaker 3: they try to alleviate the bias issues and in so
Speaker 3: doing ended up with ahistorical images talk us through some
Speaker 3: of the ways in which you get over the hurdles
Speaker 3: of trying to put safety first, of trying to put
Speaker 3: bias first, but trying to get these ultimately incredibly powerful
Speaker 3: models into people's hands quickly.
Speaker 10: So one of the things that we have always really
Speaker 10: focused on from day one is this question around safety
Speaker 10: and trustworthiness and reliability. And while it's the case that
Speaker 10: you know, no model available on the market today is perfect,
Speaker 10: Andthropic has always really aimed to be the industry leader
Speaker 10: when it comes to safety. We use a technique called
Speaker 10: constitutional AI which helps to provide all of our models,
Speaker 10: including the Claude three model family, with this sort of
Speaker 10: constitution for how to approach you know, challenging question right,
Speaker 10: introducing a sort of layer of nuance into how the
Speaker 10: models might respond to two difficult prompts.
Speaker 4: Daniel, you and many of your co founders. An Anthropic
Speaker 4: previously worked at open AI. Elon Musk has sued open
Speaker 4: AI and is saying, basically, they're breaching their original contracts
Speaker 4: because they are no longer a not for profit and
Speaker 4: they are not following that original mission of benefiting humanity
Speaker 4: through their work.
Speaker 7: Your reaction to.
Speaker 4: That, given your history open Ey, but also the work
Speaker 4: you're doing now at Enthropic, which has a similar not
Speaker 4: for profit set up.
Speaker 10: So something that we've always aimed to do as a
Speaker 10: public benefit corporation at Anthropic is really balance the kind
Speaker 10: of incredible potential power of these technologies well still ensuring
Speaker 10: that what we're developing is reliable and safe and really
Speaker 10: our kind of founding vision, right our founding mission for
Speaker 10: the company was, let's work to really raise the water
Speaker 10: mark in the industry of AI and ensure that whenever
Speaker 10: we put a model on the market, Anthropic wants to
Speaker 10: feel very confident that it is as safe as it
Speaker 10: can be. And I think what has been so exciting
Speaker 10: I think about this model release is really raising that
Speaker 10: watermark not just on safety, but also on intelligence and
Speaker 10: capability simultaneously. And I think that guiding light has always
Speaker 10: been an incredibly sort of important founding principle for us.
Speaker 4: Caroline mentioned it, and you and I have talked about it,
Speaker 4: that you're pursuing a focus on enterprise customers, you know,
Speaker 4: SaaS cloud companies, but you still have this public benefit
Speaker 4: corp center. Just explain how you manage both of those goals.
Speaker 10: So something that I think is really interesting that we've
Speaker 10: seen with you know, so many of the enterprise businesses
Speaker 10: that are really you know, building on top of Claude,
Speaker 10: is that this approach to building systems that are safe
Speaker 10: and kind of built on trust and are secure and
Speaker 10: are reliable is actually a huge draw for them.
Speaker 1: Right.
Speaker 10: So many of the Fortune five hundred are driven really
Speaker 10: by trust with their with their consumers, right, And so
Speaker 10: I think something we take incredibly seriously is this belief
Speaker 10: that when we are helping to empower businesses to build
Speaker 10: on Claude, that what we're putting in front of them
Speaker 10: is safe. And I think that's perfectly in line with
Speaker 10: our public benefit mission.
Speaker 5: Are you ultimately improving people's lives?
Speaker 3: Do you still feel, Daniella, you as a company.
Speaker 10: As an industry More broadly, so, something we've been really
Speaker 10: kind of excited and inspired to see are just the
Speaker 10: incredible potential and kind of use cases that our customers
Speaker 10: are using while interacting with Claude. So this ranges from
Speaker 10: things like you know, financial services businesses like you know,
Speaker 10: Bridgewater and SAP sk Telecom really just transforming how they
Speaker 10: work and how they interact with their end customers. But
Speaker 10: you know, most recently, I think I've been incredibly excited
Speaker 10: to see so many you know, education, health care and
Speaker 10: nonprofit businesses as well, really start to take on kind
Speaker 10: of the mantle of generative AI. We've been very excited
Speaker 10: that that groups like you know, the Dana Farber Cancer
Speaker 10: Institute are building on.
Speaker 3: Clouds, so too is a Saana Airtable, Bridgewater some really
Speaker 3: notable names in the finance space and in productivity space.
Speaker 5: And I'm interested that at the.
Speaker 3: Time that clearly from an enterprise perspective, everyone's rushing to
Speaker 3: get in, and clearly productivity can go up and to
Speaker 3: the right to significant amount.
Speaker 5: But we do question perhaps some.
Speaker 3: Worries around jobs, but we also question ultimately open AI
Speaker 3: versus closed AI, and we go back a little.
Speaker 5: Bit to the drama that's some folding between Elon Musk
Speaker 5: and open AI. And I know you must be.
Speaker 3: Relatively exhausted by that, but I look at what's beenod Coastal,
Speaker 3: for example, has been tweeting about.
Speaker 5: Saying that ultimately Sam Greg and the team over an
Speaker 5: open AI have been.
Speaker 3: Pushing out faster, better products and they need to be
Speaker 3: in a more closed space. Open AI and ultimately artificial
Speaker 3: intelligence innovation shouldn't be done permanently in some sort of
Speaker 3: open tesque way and means of doing it.
Speaker 5: Do you agree? What is your ethos on open versus closed, Daniana?
Speaker 10: I think really bottom line is that there's so much
Speaker 10: space in the kind of generative AI industry right there
Speaker 10: are many different types of models that are being rolled
Speaker 10: out across really a variety of different services. And my
Speaker 10: sense is that as businesses, you know, really are becoming
Speaker 10: quite sophisticated with how they integrate these generative AI technologies,
Speaker 10: I expect that what we'll see is really a kind
Speaker 10: of multimodel approach that many businesses might choose to rely
Speaker 10: on one type of model for certain use cases and
Speaker 10: other types of models for others. So I feel there's
Speaker 10: really quite a lot of sort of space and territory
Speaker 10: for all of these different players to kind of operate in.
Speaker 3: The space, and your space and your territory being guarded
Speaker 3: by the fact you've got these three new models open today.
Speaker 3: We thank you so much for talking us through some
Speaker 3: of the innovations that you're bringing in Anthropic. Taniana m Oday,
Speaker 3: just president and co founder of Anthropic. At what we've
Speaker 3: got coming.
Speaker 4: Up, we'll get back to bitcoin and bitcoin's rally up next,
Speaker 4: and whether concerns of a plunge following a surge might
Speaker 4: be justified still marks. Alice Clean joins us on the
Speaker 4: program We'll be right back Suspoonberg technology as time for
Speaker 4: talking tech first up. Cyber attackers backed by North Korea
Speaker 4: are said to have infiltrated to South Korean semiconductor equipment
Speaker 4: firms late last year. That's according to South Korea's sole
Speaker 4: spy agency. The agency is advising companies to take precautions
Speaker 4: after detecting attacks in December and February in which hackers
Speaker 4: sole products and manufacturing blueprints and shares of Sea are
Speaker 4: giving up gains after the company reported a smaller than
Speaker 4: expected drop in earning, Southeast Asia's largest internet firm, rallied
Speaker 4: as much as nineteen percent in pre market trading. The
Speaker 4: company says it sees improving prospects for its e commerce
Speaker 4: gaming business, alleviating some concerns have slowed down in its
Speaker 4: online retail arm Shoppy plus SpaceX and NASA saw a
Speaker 4: successful launch of Russian and American astronauts headed to the
Speaker 4: International Space Station, where the four person crews expected to
Speaker 4: spend six months. The mission DUBS Crew eight marks the
Speaker 4: thirteenth assignment four SpaceX carrying a live crew and the
Speaker 4: eighth operation for NASA with a commercial crew to the
Speaker 4: ISS Caroline.
Speaker 3: All other things maybe going to the moon in certain spaces.
Speaker 3: Let's talk about it with the VC spotlight moment. Get
Speaker 3: back to bitcoin and discuss the run that we've seen
Speaker 3: across crypto more broadly. Can we, of course be questioning
Speaker 3: some of the parabolic run that we've had, Is it
Speaker 3: valid and is their leverage behind it too? Please to
Speaker 3: welcome a long term player in the space still Mark
Speaker 3: founder and managing partner Alise Colleen, who really has been
Speaker 3: thinking about the ways in which to scale and to
Speaker 3: make more efficient the space of bitcoin and.
Speaker 5: Layer twos within that.
Speaker 3: But at least more broadly, when you're looking at the
Speaker 3: run up price point, you must be exhausted by the
Speaker 3: fact that everyone looks at this basically as sort of
Speaker 3: an asset to be well betting on and exchanging hands.
Speaker 5: But does it make sense to you? Are you worried
Speaker 5: about any leverage, any volatility?
Speaker 2: So the price appreciation of course is going to draw attention.
Speaker 2: What we're seeing now is an expansion of Bitcoin's user
Speaker 2: base through the introduction of a spot ETF and a
Speaker 2: directly regulated way for new entrants to hold bitcoin assets.
Speaker 2: I believe that this gives first time access to mantay,
Speaker 2: especially to the Boomer generation. It's ahead of the ETF launching,
Speaker 2: we could have projected between eighty million and one hundred
Speaker 2: and thirty million bitcoin holders.
Speaker 7: We have to.
Speaker 2: Acknowledge that most of those were Gen Z or millennials,
Speaker 2: and so with the.
Speaker 5: Spot ETF, we see a new.
Speaker 2: Population onboarding to bitcoin, and Bitcoin's price has always been
Speaker 2: driven by adoption and expansion use case.
Speaker 4: I really appreciate focusing on the structural, long term elements
Speaker 4: that are happening here, but I want to just go
Speaker 4: a little short term real quick. I always find it
Speaker 4: so interesting about the twenty four to seven trading patterns
Speaker 4: of crypto right and when we left the show Friday,
Speaker 4: we were talking about similar themes. But there's a lot
Speaker 4: of liquidity, a lot of trading that goes on over
Speaker 4: the weekend, some of that in the Asia session. I
Speaker 4: just wonder if you look at that and see any
Speaker 4: concentration of activity by geography, if it's happening in North
Speaker 4: America or it's happening in different parts.
Speaker 2: Of the world. So bitcoin is of course a twenty
Speaker 2: four to seven market. The introduction of the ETF has
Speaker 2: allowed a bit of a break to the attention that's
Speaker 2: needed to be paid to weekends and after hours, and
Speaker 2: that much of the movement in bitcoin has been generated
Speaker 2: by excitement and flows in the ETF products. Now all
Speaker 2: that set, of course, our attention is more on the
Speaker 2: long term bitcoin trends, including price trends, and well, we
Speaker 2: could expect to see some periods of consolidation along the way.
Speaker 2: I expect we end the year significantly higher than we're
Speaker 2: at now.
Speaker 3: Going back to the underlying innovation that therefore now gets
Speaker 3: us from not only seeing bitcoin as an asset class
Speaker 3: that has far more in demand and across different stereotypes
Speaker 3: of people, but I'm also interested in what therefore is
Speaker 3: made of the asset itself. Much of the issue is
Speaker 3: ultimately it's the gold because well, we're not going to
Speaker 3: do much more in terms of actual use cases and
Speaker 3: smart contracts because it was expensive and difficult to scale.
Speaker 3: But you're solving that problem with some of the companies
Speaker 3: you invest in. What are the ETF, for example, brought
Speaker 3: to bear in terms of innovation.
Speaker 2: So this is really interesting. We work with founders that
Speaker 2: are attempting to solve the problem of both pathways for
Speaker 2: adoption as well expansion of Bitcoin use cases.
Speaker 5: Much of that is happening with Bitcoin the.
Speaker 2: Aset on on Bitcoin's core protocol, but we're also seeing
Speaker 2: a flourishment of development and developer activity even in Bitcoin
Speaker 2: layer twos. It's notable that the twenty four month growth
Speaker 2: of Lightning Network, for example, which is Bitcoin's primary payment technology,
Speaker 2: was over twelve hundred percent between the period of twenty
Speaker 2: twenty one and twenty twenty three, giving us a sort
Speaker 2: of base of monthly transaction volume of over seven million transactions.
Speaker 2: Now there's tail ones to adoption for Lightning Network by
Speaker 2: the introduction of new Lightning Network related protocols by Stillmark
Speaker 2: portfolio company Lightning Labs, And by that I mean that
Speaker 2: we expect to see the migration of stable coins from
Speaker 2: an alt coin environment a theorem or tron to Bitcoin
Speaker 2: via Lightning protocol techrid assets, which will allow other digital
Speaker 2: assets to trade on Lightning Network in a more efficient
Speaker 2: and economical way. And on top of that, Lightning Network
Speaker 2: offers the benefit of being more scalable in terms of
Speaker 2: transactions transaction throughput, because you can expand transaction volume without
Speaker 2: needing to commit those transactions back to a base blockchain and.
Speaker 5: Take up block space.
Speaker 2: We're also seeing the introduction of protocols that enable bitcoin
Speaker 2: to be used as a suitable payment for the AI
Speaker 2: space and for payments for API calls. And what that
Speaker 2: means is that we can start to really use bitcoin
Speaker 2: to unlock some of the native value of the Web
Speaker 2: and Internet broadly.
Speaker 4: All right, still not founder managing partner at least, Colleen
Speaker 4: A is bitcoin trade sixty six, five hundred US dollars persoken.
Speaker 3: Nooyees over an Amazon warehouse in Seattle recently got a
Speaker 3: glimpse of a future of work, and it's.
Speaker 5: Very sci fi.
Speaker 3: A five foot nine robot that looks like a human,
Speaker 3: walks like a bird and has glowing white eyes. Let's
Speaker 3: bring in Bloomberg's Matt Day, who got to meet digit
Speaker 3: or the digits And at the moment they're doing pretty
Speaker 3: menial tasks ferrying boxes empty ones backwards and forwards. But
Speaker 3: I mean, are we at the cusp of some breakthrough?
Speaker 3: What got us here? Why does it feel so sci fi?
Speaker 11: Yeah? It really feels like we are I think a
Speaker 11: lot of it is just sort of the consumer electronics revolution.
Speaker 11: Broadly speaking, motors are cheaper and little actuators that make
Speaker 11: these guys move and able to bend and flex. Battery
Speaker 11: technology has gotten a lot better, and then recently you
Speaker 11: layer AI on the top of it. Right, these robots
Speaker 11: don't really make a lot of sense if you have
Speaker 11: to have somebody piloting the controls. But if you can
Speaker 11: do it sort of systematically and have them kind of
Speaker 11: reason their way through the world, then maybe this all
Speaker 11: starts to work.
Speaker 4: There's a lot happening in robotics right. Think about Figure AI,
Speaker 4: think about what Tesla is doing with optimists. But it's
Speaker 4: not sort of real well deployment. What is Amazon's plan
Speaker 4: to make this commonplace?
Speaker 11: So Amazon hasn't told us a whole lot about their roommap,
Speaker 11: but what we know now is that they are testing
Speaker 11: these robots, you know, like you said, to move tots
Speaker 11: in their warehouses. There are a lot of spots on
Speaker 11: Amazon's facilities, which are already highly automated, that still require
Speaker 11: you know, flesh and blood, somebody picking up boxes, moving
Speaker 11: boxes to a conveyor belt from a palette. That work
Speaker 11: is pretty dangerous. A lot of people don't want to
Speaker 11: do that work anyway because of relatively relatively low pay
Speaker 11: and and kind of hard pace of work issues, so
Speaker 11: they're pitching or at least a Jillie Robotics is that
Speaker 11: they might have a solution to this in the form
Speaker 11: of digit their little white eyed robot.
Speaker 5: Go read your piece in BusinessWeek, Go and see the pictures.
Speaker 3: It looks like they're doing push ups in one particular piece,
Speaker 3: but apparently they're hibernating that daily.
Speaker 5: Thank you that does it for this edition in Blueboo Technology.
Speaker 4: Check out the pod Dear view it, dear audience member,
Speaker 4: wherever you get your podcasts. From San Francisco in New
Speaker 4: York City.
Speaker 8: This is Bloomberg