WEBVTT - The Musk-Twitter Deal Finally Closes 0:00:02.200 --> 0:00:05.560 From the heart of where innovation, money and power collive 0:00:06.320 --> 0:00:10.840 in Silicon Valley and beyond. This is Bloomberg Technology with 0:00:10.920 --> 0:00:27.639 Emily Jay. Hi'm Emily Chang in San Francisco, and this 0:00:27.680 --> 0:00:31.560 is a special edition of Bloomberg Technology. Twitter is now 0:00:31.600 --> 0:00:35.160 officially owned by Elon Musk, and the news is still 0:00:35.159 --> 0:00:38.680 sinking in. He's already fired a few key top executives, 0:00:38.720 --> 0:00:43.000 announced a new content moderation council and started restructuring. How 0:00:43.040 --> 0:00:46.199 will Twitter under Musk moderate free speech? What is the 0:00:46.240 --> 0:00:50.720 business strategy? Kanye's profile appears to be back? Is Donald Trump? Next? 0:00:50.920 --> 0:00:53.959 We have a premium lineup of guests today, including one 0:00:53.960 --> 0:00:57.560 of the investors with inside knowledge of Musque's plans, along 0:00:57.600 --> 0:01:00.880 with a member of Twitter's founding team. Let's get right 0:01:00.920 --> 0:01:03.320 to it with gloomberg. Ed Ludler, who's been following Musk 0:01:03.560 --> 0:01:06.840 and his coverage of Tesla and spaces for so many 0:01:06.920 --> 0:01:10.600 years and now Twitter. He joins us now outside Twitter headquarters, 0:01:10.760 --> 0:01:14.680 live in San Francisco. So at day one under Musk, 0:01:14.920 --> 0:01:18.920 what happened? You know, not as much as we'd hope 0:01:18.920 --> 0:01:21.320 to be honest, And we know the deal closed last night. 0:01:21.560 --> 0:01:24.960 You know, Equity co investors were informed late night Eastern Time. 0:01:25.160 --> 0:01:27.080 What I'm hearing from sources actually a lot of the 0:01:27.120 --> 0:01:31.480 work we've already reported is ongoing. There are Tesla engineering 0:01:31.560 --> 0:01:34.880 staff inside of Twitter being buddied up or paired up 0:01:34.880 --> 0:01:39.600 with Twitter engineering staff, and they're basically having meetings to 0:01:39.720 --> 0:01:42.840 review the source code behind the Twitter platform. That's kind 0:01:42.840 --> 0:01:45.240 of what's happening minute by minute. You would have seen 0:01:45.240 --> 0:01:49.400 the tweet right and from Elon Musk about Content Moderation Council, 0:01:49.520 --> 0:01:52.640 and so the conversation seems to be moving really quickly 0:01:52.720 --> 0:01:55.240 from how this deal happened and what the deal looked 0:01:55.240 --> 0:01:57.000 like to what does the future of Twitter as a 0:01:57.040 --> 0:01:59.680 platform look like under Elon Musk? And of course content 0:01:59.720 --> 0:02:02.960 moderation and the support of freedom of speech to freedom 0:02:02.960 --> 0:02:07.480 expression is fast becoming what we want to talk about now. 0:02:07.640 --> 0:02:09.840 We know last night he fired a few of the 0:02:09.880 --> 0:02:16.080 key top executives Paraguagal, the CEO, Ned Siegel, the CFO Vidjigade, 0:02:16.320 --> 0:02:18.880 members of the legal team. We also saw people walking 0:02:18.880 --> 0:02:21.760 out of Twitter today with boxes. Are those all people 0:02:21.760 --> 0:02:26.600 getting fired? Yes? So, I mean on the executive departures. 0:02:26.639 --> 0:02:28.799 Sources tell us that for the time being, at least 0:02:28.840 --> 0:02:32.680 Elon Musk has installed himself as CEO of Twitter Private 0:02:32.680 --> 0:02:35.000 Twitter under him. I know that a lot of staff 0:02:35.040 --> 0:02:38.080 were really concerned, for example, by Ned Siegel's departure. Right 0:02:38.080 --> 0:02:41.200 He was CFO for five years, regarded generally as a 0:02:41.280 --> 0:02:45.120 very nice guy. Um. Two individuals walked out of the 0:02:45.160 --> 0:02:49.120 building behind me earlier today. They claimed to be Twitter 0:02:49.200 --> 0:02:55.240 employees who had been laid off. It turns out, according 0:02:55.280 --> 0:02:57.280 to sources, that that was a hoax, or at least 0:02:57.280 --> 0:03:00.000 Twitter staff believe it was a hoax, that they were 0:03:00.080 --> 0:03:03.880 not Twitter employees and therefore not laid off. We phone Twitter. 0:03:04.320 --> 0:03:07.200 We've asked Twitter for comment and to clarify the situation. 0:03:07.200 --> 0:03:10.359 We've asked Musk's team to clarify who those people were, 0:03:10.360 --> 0:03:14.600 and we've not heard back. All Right, Ed Ludlow outside 0:03:14.600 --> 0:03:16.560 Twitter headquarters. Thanks for your reporting, and we're going to 0:03:16.600 --> 0:03:18.720 get back to you a little bit later in the show. 0:03:18.800 --> 0:03:20.720 I do want to bring in Ross Gerber right now, 0:03:20.760 --> 0:03:23.840 president and CEO of Gerber Kawasaki. He is an investor 0:03:23.919 --> 0:03:27.840 in Tesla and SpaceX and now Musk's Twitter. So Ross, 0:03:27.880 --> 0:03:30.880 please clarify for us what's your role in the new 0:03:30.919 --> 0:03:34.720 Twitter under Elon Musk, especially given we've talked about this 0:03:34.760 --> 0:03:36.839 a few times this year, you weren't such a fan 0:03:37.200 --> 0:03:41.360 of Elon Musk owning Twitter after all. Yeah. Yeah, this 0:03:41.440 --> 0:03:45.280 has been an extremely painful and difficult process for the 0:03:45.360 --> 0:03:49.680 last six months, more so for Elon than me. Um, 0:03:49.720 --> 0:03:53.120 you know. So when it came down to it last week, 0:03:53.280 --> 0:03:55.880 they asked if we wanted to invest in, and I 0:03:55.880 --> 0:03:58.720 said yes, because you know, I I stick. I stick 0:03:58.760 --> 0:04:00.240 with Elon. You know, He's made me a lot of 0:04:00.240 --> 0:04:02.880 money over the years, and I have great confidence in 0:04:02.920 --> 0:04:05.720 his leadership and an ability to turn Twitter around and 0:04:05.760 --> 0:04:08.320 make it a much better platform. But it was only 0:04:08.360 --> 0:04:11.440 after I heard the business plan that I was convinced 0:04:11.520 --> 0:04:15.440 that this was an incredible opportunity. And and that's why 0:04:15.480 --> 0:04:17.520 I'm backing it. And and I don't really have a 0:04:17.640 --> 0:04:19.200 role at this time. I'm trying to get on the 0:04:19.760 --> 0:04:22.719 either the advisory board or the content moderation board in 0:04:22.760 --> 0:04:25.839 the sense of I think with my background and media 0:04:25.960 --> 0:04:28.520 and communications, and I actually studied free speech at the 0:04:28.520 --> 0:04:31.479 Anniberg School of Communications at Pen actually at the same 0:04:31.480 --> 0:04:35.839 time Ellen was studying at PENN as well. And being 0:04:35.839 --> 0:04:40.600 a liberal Jewish mostly democrat, I think that people would 0:04:40.600 --> 0:04:43.120 be very comforted to know that somebody like myself might 0:04:43.120 --> 0:04:46.360 be involved with this type of decision making. So so 0:04:46.400 --> 0:04:48.480 I've made my pitch to them and we'll see what happens. 0:04:50.360 --> 0:04:53.560 So you've seen the business plan, you say, what's in it? 0:04:53.960 --> 0:04:57.000 What are Elon Musk's plans for this company to grow it, 0:04:57.080 --> 0:05:01.240 to make money, et cetera. Yeah, I mean, first of all, 0:05:01.279 --> 0:05:03.520 there's really two parts of the plan. There's Twitter one 0:05:03.520 --> 0:05:06.200 point and Twitter two point oh. And Twitter two point oh. 0:05:06.240 --> 0:05:08.760 I don't think Ellen is fully sure how that will look, 0:05:08.839 --> 0:05:11.719 but but it will involve a much bigger vision. But 0:05:11.760 --> 0:05:15.440 Twitter one point oh is really fixing Twitter and making 0:05:15.440 --> 0:05:19.000 it a better platform, and it's around a three pronged approach. First, 0:05:19.279 --> 0:05:21.960 it's cleaning up the platform and creating some sort of 0:05:22.040 --> 0:05:25.560 verification system so users are really people, and that will 0:05:25.600 --> 0:05:30.279 make advertisers and users have a much better platform to 0:05:30.320 --> 0:05:34.120 share information and ideas than the current system where bots 0:05:34.160 --> 0:05:36.800 and you know, sort of attack robots go after everything 0:05:36.800 --> 0:05:40.520 you tweet. So by knowing who the users are and 0:05:40.560 --> 0:05:44.279 creating this verification, I think the platform will be a 0:05:44.400 --> 0:05:47.839 much better place for users. Secondly, it's about creating a 0:05:47.839 --> 0:05:51.440 subscription model so that not all revenues derived from advertising, 0:05:51.680 --> 0:05:54.560 taking some of the power away from advertisers, uh and 0:05:54.600 --> 0:05:58.239 putting the power back into users. And this subscription will 0:05:58.279 --> 0:06:02.000 include many different factors including the verification and many other 0:06:02.240 --> 0:06:05.520 like small benefits like uh, maybe an edit feature kind 0:06:05.520 --> 0:06:07.680 of like what Twitter blue is now. And then the 0:06:07.720 --> 0:06:10.640 third part is really about building the creator community. And 0:06:10.680 --> 0:06:13.280 this is a really a combination of like combining like 0:06:13.320 --> 0:06:17.080 some of the features of YouTube slash Zoom with what 0:06:17.200 --> 0:06:20.080 Patreon is doing, and and a company maybe like only 0:06:20.160 --> 0:06:23.200 Fans where where creators want to be compensated for putting 0:06:23.200 --> 0:06:26.120 great content on platforms. And really YouTube is the best 0:06:26.120 --> 0:06:29.240 at doing this, so most of the other platforms um 0:06:29.400 --> 0:06:32.880 whether it be you know, commerce related like Instagram um 0:06:33.000 --> 0:06:37.039 or just information or entertainment related like TikTok, don't really 0:06:37.080 --> 0:06:41.360 have great monetization for creators. And that's really a focus 0:06:41.360 --> 0:06:43.719 of Ellon, which is getting great creators back on the 0:06:43.720 --> 0:06:46.320 platform and and a way for them to make a living. 0:06:46.360 --> 0:06:48.880 So if they achieve all three of these things and 0:06:49.160 --> 0:06:52.440 getting a cut of transactions and the creator economy as 0:06:52.440 --> 0:06:55.400 well as subscription revue on top of the ad revenue, 0:06:55.680 --> 0:07:00.000 this becomes a much more interesting business. Let's talk about 0:07:00.000 --> 0:07:02.599 a content moderation council that he said he would form. 0:07:02.640 --> 0:07:05.440 He also said there wouldn't be any big decisions until 0:07:05.520 --> 0:07:08.240 that happens. It does look like Kanye West or Yea 0:07:08.800 --> 0:07:11.960 is back on the platform. Does this mean Donald Trump 0:07:12.000 --> 0:07:15.360 isn't coming back anytime soon, isn't coming back before the 0:07:15.400 --> 0:07:20.400 midterm elections? Well, you know, I'm not sure where Elon 0:07:20.520 --> 0:07:23.520 stands with these issues other than he believes and I 0:07:23.560 --> 0:07:26.400 agree as well. And I have to say, there's nobody 0:07:26.400 --> 0:07:29.000 who hates Trump more than me. But I do believe 0:07:29.000 --> 0:07:31.960 in pre speech and I believe if he follows the 0:07:31.960 --> 0:07:35.000 guidelines of the platform, he should be allowed to speak, 0:07:35.040 --> 0:07:39.040 just like the Ayatola and Putin are tweeting as well. 0:07:39.320 --> 0:07:43.160 You know, It's like we can't just arbitrarily decide. So 0:07:43.200 --> 0:07:48.240 I think having transparency through a process, having better algorithms 0:07:48.280 --> 0:07:52.040 to identify hate and bad speech, and holding everybody accountable 0:07:52.080 --> 0:07:54.760 to the same standards is really what melons about, and 0:07:54.840 --> 0:07:58.640 creating a great marketplace for ideas um and whether Trump 0:07:58.720 --> 0:08:02.240 violates those rules or not, he'll be held accountable to 0:08:02.280 --> 0:08:06.440 the same rules as everybody. Now, the reason you aren't 0:08:06.480 --> 0:08:09.400 excited about Ellen being involved in Twitter is because you 0:08:09.440 --> 0:08:14.120 are a longtime Tesla investor, you're also in SpaceX. Are 0:08:14.120 --> 0:08:17.200 you concerned about Tesla? Are you concerned about SpaceX and 0:08:17.320 --> 0:08:20.760 his ability to keep these companies running and growing while 0:08:20.800 --> 0:08:23.360 he now has a third company that he has to 0:08:23.360 --> 0:08:27.840 take care of. Well, I'm not really that concern about Tesla, 0:08:27.960 --> 0:08:32.360 SpaceX and both companies achieving enormous successes and and have 0:08:32.440 --> 0:08:34.800 a very clear path and business plan in front of 0:08:34.840 --> 0:08:38.920 him which Ellen is guiding. Um, My bigger concern was 0:08:39.000 --> 0:08:42.080 him being CEO of Twitter for any extended period of time, 0:08:42.120 --> 0:08:44.120 and that just there's only so much time in the day, 0:08:44.440 --> 0:08:47.320 and can you really achieve his goals at Twitter along 0:08:47.360 --> 0:08:51.200 with all his responsibilities of going to the moon and 0:08:51.240 --> 0:08:53.840 building the biggest, you know, ev tech company in the world. 0:08:53.960 --> 0:08:57.360 So you know, how does one person do this? And 0:08:57.160 --> 0:08:59.920 and I think that's a legitimate concern, And that was 0:09:00.080 --> 0:09:02.520 the one concern I brought up in the conversation, is 0:09:02.559 --> 0:09:04.760 like how long is he really going to be CEO? 0:09:05.200 --> 0:09:08.200 But I think what he's done and all his company 0:09:08.280 --> 0:09:13.320 is very effectively is found great autonomous leaders that really 0:09:13.360 --> 0:09:15.679 can run the business when he's running around doing other 0:09:15.720 --> 0:09:19.440 stuff and he guides people in a very specific manner. 0:09:19.480 --> 0:09:23.240 But I also think his engagement, obviously in different levels, 0:09:23.240 --> 0:09:25.920 will be limited because he had now had three businesses 0:09:25.960 --> 0:09:29.800 instead of two. Well what did he tell you, I mean, 0:09:29.840 --> 0:09:33.080 how long does he plan to be CEO? Well, I 0:09:33.080 --> 0:09:35.760 didn't speak to him directly about this. I spoke with 0:09:35.880 --> 0:09:41.240 his right hand person, Jared Burchnell, and um, you know, 0:09:41.440 --> 0:09:45.040 there were so most people deal with Elon really we 0:09:45.160 --> 0:09:48.320 just don't know, you know, like what will happen next, 0:09:48.440 --> 0:09:52.640 which is really the beauty and horror of dealing with Elon, 0:09:52.840 --> 0:09:55.520 you know. So if you want stability, you know, this 0:09:55.559 --> 0:09:57.560 isn't the guy. But on the other hand, he's going 0:09:57.600 --> 0:10:00.240 to achieve great things. So so I'm not sure. And 0:10:00.280 --> 0:10:02.439 I think he's digging in now to see what kind 0:10:02.440 --> 0:10:04.839 of problem he's got to solve. And and as I've 0:10:04.840 --> 0:10:08.760 said earlier, Milon loves trying to solve the most difficult 0:10:08.840 --> 0:10:11.480 problems in the world and and this is definitely one 0:10:11.520 --> 0:10:13.520 of them. So so he's gonna have to put some 0:10:13.559 --> 0:10:15.880 time into this one. And just the same, I think 0:10:15.920 --> 0:10:18.520 he's got the team in Tesla in place. Tesla has 0:10:18.520 --> 0:10:19.960 a great year in front of them, and I don't 0:10:19.960 --> 0:10:25.120 see that being affected in any way. So let's talk 0:10:25.120 --> 0:10:27.880 about the job cuts. I mean, I already you know 0:10:27.960 --> 0:10:32.079 much of the executive team is gone. He had said 0:10:32.280 --> 0:10:34.000 or there was reporting that he was going to fire 0:10:35.160 --> 0:10:37.720 of the workforce. Then he said he never said that. 0:10:38.200 --> 0:10:41.960 So where do you think he really stands on job cuts? 0:10:42.160 --> 0:10:44.600 And you know, how many jobs do you think should 0:10:44.640 --> 0:10:48.280 be cut or should they be cut especially right away? Well, 0:10:48.280 --> 0:10:50.079 I know where he stands from what I was told, 0:10:50.120 --> 0:10:53.280 and he I was never told. In fact, I told 0:10:53.280 --> 0:10:55.720 the Washington Post myself that their number was incorrect and 0:10:55.720 --> 0:11:00.439 they didn't think the article that said, um, there will 0:11:00.480 --> 0:11:04.960 be massive job was what I was told. And and 0:11:05.000 --> 0:11:07.800 so you know, half the people on Twitter are probably 0:11:07.800 --> 0:11:10.400 gonna lose their jobs and and the other half probably 0:11:10.400 --> 0:11:13.080 will not. And what the way to really look at 0:11:13.080 --> 0:11:16.840 it this way is that Ellen is hiring from Twitter 0:11:17.360 --> 0:11:20.600 this new team that will run Twitter and whatever it 0:11:20.640 --> 0:11:24.080 will become. And he's starting with the engineering talent. There's 0:11:24.120 --> 0:11:26.080 a lot of talent at Twitter, and he wants to 0:11:26.080 --> 0:11:29.680 retain and hire these people. And where we'll see most 0:11:29.720 --> 0:11:31.960 of the layoffs are at the top and in the 0:11:31.960 --> 0:11:34.840 project management side, where many of the projects have not 0:11:34.960 --> 0:11:37.800 come to fruition or not great ideas, and they're gonna 0:11:37.800 --> 0:11:40.320 cut a lot of these projects. And so um, when 0:11:40.320 --> 0:11:42.880 you look at the job cuts that they've made already, Um, 0:11:42.920 --> 0:11:45.600 he's already saved himselves. You know, probably a hundred million 0:11:45.600 --> 0:11:50.640 dollars in compensation just from firing for very overpaid Twitter executives. 0:11:50.679 --> 0:11:54.840 So I have no love or um belief in the 0:11:54.880 --> 0:11:58.040 current management team of Twitter. And I think the first 0:11:58.040 --> 0:11:59.440 thing you do is you start from the top and 0:11:59.480 --> 0:12:02.440 you start utting. Um. So that's actually good news for 0:12:02.480 --> 0:12:04.480 most of the people on Twitter, because if you're a productive, 0:12:04.760 --> 0:12:07.080 successful person on Twitter, you're gonna retain your job and 0:12:07.120 --> 0:12:09.319 you should not be worried in the least bit. You 0:12:09.360 --> 0:12:12.920 should be excited about the opportunity to work for one 0:12:12.920 --> 0:12:17.600 of the most incredible entrepreneurs of our time. So let's 0:12:17.600 --> 0:12:19.680 talk a little bit about Twitter two point oh as 0:12:19.720 --> 0:12:22.840 you call it. What does it look like further out? 0:12:23.000 --> 0:12:26.160 Is it part of this X the everything app thing? 0:12:26.480 --> 0:12:29.640 Do some of Musk's other companies have a role. For example, 0:12:29.720 --> 0:12:34.760 starlink and Starlink have some sort of role in future Twitter. Well, 0:12:35.040 --> 0:12:38.439 not necessarily. I think starlinking is an example of where 0:12:38.480 --> 0:12:41.720 they see Twitter two point oh because when they started SpaceX, 0:12:41.960 --> 0:12:45.880 Starlink wasn't even an idea, and Starlink ended up becoming 0:12:45.920 --> 0:12:50.280 this amazing project out of SpaceX really, and and that's 0:12:50.320 --> 0:12:52.640 where Twitter two point oh is, which was sort of 0:12:52.679 --> 0:12:55.280 like pitched as like, well, we're not really sure what 0:12:55.360 --> 0:12:57.360 it will invent, but we know it will be awesome. 0:12:57.720 --> 0:13:00.280 And a lot of this will be the incorporate ration 0:13:00.320 --> 0:13:06.600 of cryptocurrencies and the digital ecosystem into the commerce, uh 0:13:06.679 --> 0:13:10.760 and creator element of Twitter. So when you actually start 0:13:10.800 --> 0:13:14.280 thinking about trading digital goods and services and digital commerce 0:13:14.320 --> 0:13:18.560 like with cryptocurrencies, and you add in that element to 0:13:18.920 --> 0:13:25.400 Twitter as an overall platform for good services ideas entertainment 0:13:25.840 --> 0:13:28.880 um and such um, it becomes a little bit more 0:13:28.960 --> 0:13:32.200 of Elon's vision of X. And really, where I see this, 0:13:32.720 --> 0:13:35.040 which kind of hit me last night, is maybe he's 0:13:35.080 --> 0:13:38.880 building the future operating system for Tesla as well, for 0:13:39.080 --> 0:13:41.480 all the screens and the millions and millions of cars 0:13:41.720 --> 0:13:46.760 that will now run on this new communication social platform. 0:13:46.880 --> 0:13:50.280 So there's a lot to this that people can put 0:13:50.320 --> 0:13:54.559 together between Tesla, Twitter software, building an operating mobile system, 0:13:54.840 --> 0:13:57.760 and building something that will be great for sharing ideas 0:13:57.760 --> 0:14:02.040 and commerce. Um boy, the potential is unlimited and that's 0:14:02.040 --> 0:14:07.520 why I am investing. All right, Ross garber CEO, President 0:14:07.520 --> 0:14:11.400 of gerber Kasaki. Great to have your inside perspective with us. 0:14:11.400 --> 0:14:13.800 We'll be looking to you for more information on the 0:14:13.840 --> 0:14:16.720 inside track as this role is always happy to help, 0:14:16.920 --> 0:14:20.400 always happy to help. Thank you, all right, thank you, Okay, 0:14:20.480 --> 0:14:23.320 coming up. The deal is done, but Musk's court battles 0:14:23.480 --> 0:14:24.920 aren't over. We're going to talk to you about the 0:14:25.000 --> 0:14:46.880 looming legal challenges he still faces. Next. This is Bloomberg. Well. 0:14:46.920 --> 0:14:49.720 After months spent in a brutal legal battle trying to 0:14:49.720 --> 0:14:52.120 get out of his forty four billion dollar proposal to 0:14:52.120 --> 0:14:56.160 buy Twitter, Elon, Musk still has outstanding matters in Delaware courts. 0:14:56.160 --> 0:14:59.200 He is scheduled to return before the same judge in 0:14:59.520 --> 0:15:02.800 Delaware Chancer Record in November for a separate trial over 0:15:02.840 --> 0:15:07.760 his complimence compensation at Tesla, which could top fifty billion dollars. 0:15:07.960 --> 0:15:10.200 For more on this, I want to bring in Lawrence Hammermash, 0:15:10.240 --> 0:15:12.840 executive director of the Institute for Law and Economics at 0:15:13.480 --> 0:15:15.960 University of Pennsylvania's Carry Law School. Larry, thank you so 0:15:16.080 --> 0:15:17.920 much for joining us. So we're gonna talk about that, 0:15:17.960 --> 0:15:21.200 But let's talk about what just happened. Did Elon must 0:15:21.200 --> 0:15:24.840 just dodge a huge legal bullet here in closing this 0:15:24.920 --> 0:15:28.360 deal for Twitter. Yeah we'll never know, will we, But 0:15:28.360 --> 0:15:32.480 but it sure was looking ugly for him as the 0:15:32.640 --> 0:15:36.160 as the trial approached. Um, quite apart from the fact 0:15:36.160 --> 0:15:39.640 that he uh avoided having his deposition taken in the case, 0:15:39.720 --> 0:15:42.160 he was going to have to deal with a lot 0:15:42.240 --> 0:15:46.600 of frankly, would seem like contradictory statements about Twitter in 0:15:46.640 --> 0:15:51.160 the last several months, And I for one didn't see 0:15:51.200 --> 0:15:53.040 a way for him to get to the goal line 0:15:53.120 --> 0:15:55.720 in that case, goal line as it was at the 0:15:55.760 --> 0:16:00.240 time getting out of the deal. So as much as uh, 0:16:00.280 --> 0:16:02.440 his turn around and saying Yep, I'm gonna go ahead 0:16:02.600 --> 0:16:05.680 was a shock to me, uh, it kind of made 0:16:05.720 --> 0:16:08.840 sense because I think he was, as we used to say, 0:16:08.840 --> 0:16:13.760 cruising for a person. Do you think this will impact 0:16:14.280 --> 0:16:17.200 the tech m and a landscape going forward? You know, 0:16:17.280 --> 0:16:25.080 will this discourage potential breakups? Well? Uh, I'm not sure 0:16:25.080 --> 0:16:27.520 it'll do so any more than the law did before. 0:16:27.720 --> 0:16:30.800 I mean, it's been pretty clear, uh from a number 0:16:30.840 --> 0:16:33.360 of cases in Delaware that when push comes to shove. 0:16:33.480 --> 0:16:36.360 If if your deal says you don't have a way out, 0:16:36.960 --> 0:16:40.120 the court's going to do something and is not afraid 0:16:40.160 --> 0:16:42.840 to make you go through with it the specific performance 0:16:42.840 --> 0:16:46.760 remedy that people talk about. So I'm not sure there's 0:16:46.840 --> 0:16:50.040 new law. I'm not sure there's new guidance, but maybe 0:16:50.040 --> 0:16:52.960 there's new reassurance that a deal is a deal and 0:16:53.000 --> 0:16:57.480 it's going to be enforced. So let's talk about these 0:16:57.520 --> 0:17:03.600 other issues that he's facing. What how serious are these 0:17:03.600 --> 0:17:08.000 Tesla other Tesla situations and how significant is it that 0:17:08.400 --> 0:17:10.359 he's got to deal with the same judge who didn't 0:17:10.359 --> 0:17:14.080 make so many favorable rulings on the Twitter deal leading 0:17:14.119 --> 0:17:18.000 up to this. Well, Um, I don't want to puncture 0:17:18.000 --> 0:17:20.560 your balloon, but I think what's left in Delaware is 0:17:20.600 --> 0:17:23.600 not nearly as exciting or as big as as the 0:17:23.640 --> 0:17:28.160 case that we almost just had with with Twitter. But uh, 0:17:28.200 --> 0:17:31.840 they're they're serious, and they're really two cases. H. One 0:17:32.080 --> 0:17:35.199 uh that's scheduled to go to trial soon is uh 0:17:35.720 --> 0:17:39.480 the one involving a compensation package Ellen got from Tesla 0:17:39.560 --> 0:17:43.800 back in a whole slug of stock options in in 0:17:43.960 --> 0:17:48.719 I think twelve tranches, uh, and they were performance based 0:17:49.000 --> 0:17:50.720 in other words, he didn't get the benefit of those 0:17:50.760 --> 0:17:57.320 options unless Tesla met some milestone performances, which they mostly did. 0:17:58.080 --> 0:18:03.359 Uh and uh. And yet what there's what's left for 0:18:03.440 --> 0:18:07.440 trial is a stockholders suit claiming that that compensation, that 0:18:07.560 --> 0:18:10.840 equity compensation was just way excessive in you know, in 0:18:10.880 --> 0:18:14.159 the billions of dollars. I don't know what it's really worth, 0:18:14.359 --> 0:18:20.280 but it's worth a lot. So how could this potentially 0:18:20.480 --> 0:18:22.679 impact him given he just shelled out a lot of 0:18:22.680 --> 0:18:29.960 money to buy Twitter? Well, uh it Uh, if he loses, 0:18:30.720 --> 0:18:34.720 it could be significant. Although you know, even a couple 0:18:34.720 --> 0:18:38.400 of billion dollars is a lot less than than uh 0:18:38.440 --> 0:18:43.400 forty four, but it would be significant if he lost. However, 0:18:43.880 --> 0:18:46.280 I think it's important to keep in mind that when 0:18:46.520 --> 0:18:50.480 the judge, who has since retired, decided a motion to 0:18:50.560 --> 0:18:56.399 dismiss the case, he said, Yeah, it's the plaintiff stockholder 0:18:56.400 --> 0:19:00.640 who's going to have to prove unfairness in this case. Uh, 0:19:00.760 --> 0:19:05.240 principally because of the stockholder approval of the pay package. 0:19:06.000 --> 0:19:09.159 Because the stockholder is gonna playing, the stockholder is going 0:19:09.200 --> 0:19:12.080 to have to prove unfairness. Uh. You know, it's not 0:19:12.160 --> 0:19:15.800 a stubble laid down hand and in fact, uh the 0:19:15.880 --> 0:19:19.000 judge who decided the motion to dismiss said, you know, 0:19:19.200 --> 0:19:22.800 they pleaded adequate facts to get by emotion to dismiss 0:19:22.840 --> 0:19:27.000 and to go to trial, but only barely. So. He 0:19:27.119 --> 0:19:29.760 was kind of skeptical even at the outset that even 0:19:29.760 --> 0:19:32.120 if the case went to trial much would come out 0:19:32.119 --> 0:19:35.040 of it. And I haven't seen anything that's changed since then. 0:19:35.800 --> 0:19:37.960 To be honest, this strikes me as a case that 0:19:38.480 --> 0:19:41.000 would make a lot of sense to settle at a 0:19:41.119 --> 0:19:46.480 much smaller level than a million dollars. All right, well, 0:19:46.720 --> 0:19:50.120 we will be looking out for that, among other things. 0:19:50.440 --> 0:19:53.000 Larry Hammerash, executive director of the Institute for Law and 0:19:53.040 --> 0:20:07.600 Economics from the University of Pennsylvania. Not all tech companies 0:20:07.600 --> 0:20:10.840 are taking a beating this earning season. Apple actually soared 0:20:10.880 --> 0:20:13.439 as much as eight point one percent in New York trade, 0:20:13.480 --> 0:20:16.920 closing up seven point six for its biggest one day 0:20:16.960 --> 0:20:20.600 gain since July. This thanks to its revenue and profit, 0:20:20.680 --> 0:20:24.080 both topping analysts estimates. In spite of disappointing sales of 0:20:24.119 --> 0:20:27.879 iPhones and services. Has proved to be good enough news 0:20:27.960 --> 0:20:31.440 to avoid the fate of piers like Alphabet, Microsoft, even Meta, 0:20:31.520 --> 0:20:34.840 who've seen their valuation plunge by hundreds of billions of 0:20:34.880 --> 0:20:39.439 dollars this season, and Amazon couldn't escape the downward trend, 0:20:39.560 --> 0:20:42.800 with its market value dipping below one trillion dollars at 0:20:42.800 --> 0:20:44.639 one point. In closing the trading day at its lowest 0:20:44.640 --> 0:20:47.719 since June fourteen. The e commerce giant projected the slowest 0:20:47.720 --> 0:20:50.679 holiday quarter growth in the company's history, while sales at 0:20:50.720 --> 0:20:55.280 its web services business missed estimates. And some other news 0:20:55.280 --> 0:20:57.520 In San Francisco, we want to keep you updated on 0:20:57.760 --> 0:21:01.760 how speaker Nancy Pelosi's office says husband Paul Pelosi has 0:21:01.800 --> 0:21:06.040 had successful skull fracture surgery. This after a man broke 0:21:06.080 --> 0:21:09.720 into Pelosi's home earlier today and attacked him with a hammer. 0:21:10.200 --> 0:21:13.600 The assailant confronted Paul Pelosi and shouted where is Nancy? 0:21:13.640 --> 0:21:16.200 Where is Nancy, before striking him in the head and body. 0:21:16.240 --> 0:21:19.639 According to people familiar with the investigation, police say the 0:21:19.640 --> 0:21:22.320 man is now in custody and is being charged with 0:21:22.359 --> 0:21:36.160 attempted homicide and other crimes. As the world's richest person 0:21:36.200 --> 0:21:39.240 with corporate interests around the globe, Elon Musk is under 0:21:39.320 --> 0:21:43.320 close watch by regulators. Just today, a European Commissioner reacted 0:21:43.320 --> 0:21:45.760 to his acquisition of Twitter by saying the company needs 0:21:45.760 --> 0:21:49.239 to play by the rules. Bloomberg Sarafier here with us 0:21:49.240 --> 0:21:53.400 now to discuss Sarah between his work with Starlink and Ukraine, 0:21:53.440 --> 0:21:56.439 Tesla's presence in China now of course owning Twitter a 0:21:56.520 --> 0:21:59.040 lot to keep tabs on walk us through the political 0:21:59.119 --> 0:22:03.560 impact of this acquisition. I think that this is gonna 0:22:03.600 --> 0:22:06.479 be one of the main things we end up talking 0:22:06.520 --> 0:22:11.040 about with Elon Musk, because this this platform, it's it's 0:22:11.119 --> 0:22:14.959 not so much UM a business problem. It does have 0:22:15.000 --> 0:22:17.800 business problems, but the bigger problems are political ones. It's 0:22:17.840 --> 0:22:22.119 always about fighting in every country to not share data 0:22:22.160 --> 0:22:26.439 on dissidents or um not um take something down that 0:22:26.480 --> 0:22:29.280 a leader doesn't want to have up UM. And I 0:22:29.320 --> 0:22:33.439 think having a business like Tesla operating around the world 0:22:34.000 --> 0:22:37.840 UM gives world leader some leverage over Eason Musk that 0:22:37.920 --> 0:22:41.280 they didn't perhaps have over prior Twitter leaders. So I 0:22:41.359 --> 0:22:45.480 do think that that can be concerning long term UM. 0:22:45.640 --> 0:22:48.960 What we're what we're seeing so far is that Musk 0:22:49.080 --> 0:22:51.640 is trying to take a sort of a measured approach 0:22:51.920 --> 0:22:54.399 to Twitter, maybe more measured than the thought that he 0:22:54.440 --> 0:22:57.320 would at least based on his tweets today, he says 0:22:57.119 --> 0:23:02.320 he wants to create a content moderation counsel to overview 0:23:02.600 --> 0:23:05.880 whether people the permanent bandage to be restored, even though 0:23:05.880 --> 0:23:09.240 previously he said that he doesn't believe in permanent bands. 0:23:09.320 --> 0:23:11.840 He's he sold advertisers that he wants to build Twitter 0:23:11.840 --> 0:23:14.560 to be something good for humanity. UM that he doesn't 0:23:14.560 --> 0:23:16.960 want it to become, you know, a toxic success pool. 0:23:17.280 --> 0:23:21.520 So I think that he is is jumping into the 0:23:21.520 --> 0:23:26.040 deep end and getting initiated with this um really complicated 0:23:26.320 --> 0:23:30.760 political entity that is Twitter, which no one has really 0:23:30.800 --> 0:23:33.840 been able to run in a way that satisfies the public. 0:23:33.920 --> 0:23:38.280 Let's be honest. Do you think given that he just 0:23:38.520 --> 0:23:41.479 owns or runs so many different companies. You've got Tesla 0:23:41.600 --> 0:23:45.000 already under investigation. His tweet to take a private put 0:23:45.080 --> 0:23:49.680 him under investigation. Will his ownership of Twitter with free 0:23:49.680 --> 0:23:54.000 speech in question, take regulatory scrutiny of him to a 0:23:54.040 --> 0:23:57.680 whole new level? You know what? It might? I think 0:23:57.720 --> 0:24:01.239