WEBVTT - Amazon's Latest Gadgets, Circle and Robinhood 0:00:02.240 --> 0:00:05.640 From the heart of where Innovation, money and power callive 0:00:06.360 --> 0:00:10.920 in Silicon Valley and beyond. This is Bloomberg Technology with 0:00:10.960 --> 0:00:26.400 Emily jay I made Ludlow in New York in family 0:00:26.520 --> 0:00:29.520 chang This is Bloomberg Technology. Coming up in the next hour. 0:00:29.600 --> 0:00:33.199 A Bloomberg report about Apple's plans to scale back iPhone 0:00:33.240 --> 0:00:35.880 production sends the stock down by as much as four 0:00:35.920 --> 0:00:38.960 point six pc. The company planned to build an extra 0:00:39.080 --> 0:00:43.040 six million phones, but the extra demand never materialized. We'll 0:00:43.040 --> 0:00:46.960 have the details in a moment. Plus, Amazon devices get 0:00:47.000 --> 0:00:50.120 a facelift and a good night's rest. The company unveiled 0:00:50.120 --> 0:00:52.720 a bedside sleep tracker, as well as a new Kindle, 0:00:52.920 --> 0:00:56.880 updated ring cameras, and echo products. I'll discuss with Amazon 0:00:57.000 --> 0:01:01.520 Senior VP of Devices and so cause, Jeremy Alaire talks 0:01:01.520 --> 0:01:05.240 about the latest announcements from their Converge twenty two conference, 0:01:05.440 --> 0:01:10.040 including its new partnership with Robin Hood. Bloomberger has learned 0:01:10.040 --> 0:01:12.679 Apple is backing off plans to increase production of its 0:01:12.680 --> 0:01:15.760 new iPhones this year. The company had expected a surge 0:01:15.800 --> 0:01:19.440 in demand, but that hadn't happened, according to sources. Bloomber's 0:01:19.480 --> 0:01:22.360 Mount German joins me from l A with the details. Mark, 0:01:22.440 --> 0:01:26.000 what is our latest reporting on what's going on? So 0:01:26.120 --> 0:01:30.000 for two, Apple set out to build and sell through 0:01:30.160 --> 0:01:34.120 ninety million new iPhone fourteen units. That's across the four models, 0:01:34.160 --> 0:01:37.480 the fourteen, the fourteen plus, the Pro, and the Pro Max. 0:01:37.840 --> 0:01:40.360 But recently they sort of had this extra credit idea 0:01:40.400 --> 0:01:42.880 I'll call it for an extra six million phones on 0:01:42.959 --> 0:01:45.160 top of that ninety million. But like you said, that 0:01:45.280 --> 0:01:49.000 extra six million no longer necessary because the concerns about 0:01:49.000 --> 0:01:52.720 that extra demand not happening in two. I would say 0:01:52.760 --> 0:01:55.919 that probably has to do with some recession pressures inflationary 0:01:55.920 --> 0:01:59.440 pressures as well. That people are experiencing the iPhone fourteen 0:01:59.480 --> 0:02:03.400 and fourteen plus not significant upgrades over the thirteens, but 0:02:03.520 --> 0:02:05.760 the pros that's where the big upgrades are. That's what 0:02:05.840 --> 0:02:08.160 people want to buy. So I think people are holding 0:02:08.160 --> 0:02:10.400 off on buying the phone until they're able to buy 0:02:10.680 --> 0:02:12.799 that fourteen Pro or Pro Max for when it makes 0:02:12.800 --> 0:02:15.720 sense for them to upgrade to those price here and 0:02:15.840 --> 0:02:18.880 quite frankly far better versions of the device market. Seems 0:02:18.919 --> 0:02:22.320 to be some evidence some data that consumers around the 0:02:22.320 --> 0:02:24.560 world of going to the higher price point pro. What 0:02:24.639 --> 0:02:28.280 have we learned about early demand. Yeah, early demand tells 0:02:28.320 --> 0:02:31.360 us that the iPhone fourteen Pro and particularly iPhone fourteen 0:02:31.400 --> 0:02:34.200 Pro Max, that's where it's at this year. People want 0:02:34.240 --> 0:02:36.839 those devices. If you just look at on your over 0:02:36.919 --> 0:02:39.640 year level, the move from the iPhone thirteen to the 0:02:39.680 --> 0:02:43.440 fourteen and the non Pro models extremely minimal. I would 0:02:43.440 --> 0:02:46.440 say the thirteen to the fourteen smallest upgrade in the 0:02:46.480 --> 0:02:51.040 iPhone's history, but Pro to Pro very big upgrade. Fort 0:02:51.040 --> 0:02:53.960 makeapixel camera on the back, the dynamic island system that 0:02:53.960 --> 0:02:56.160 you're showing on the on the on the screen right now. 0:02:56.720 --> 0:02:59.800 The satellite connectivity is available on both models, but some 0:02:59.840 --> 0:03:02.520 of those video upgrades, those are all on the Pro models, 0:03:02.520 --> 0:03:04.440 and so I think that's what people really want to 0:03:04.480 --> 0:03:07.600 hold out for. If you look at the Apple online store, 0:03:08.280 --> 0:03:11.040 you can see in particular there the shipment delay times 0:03:11.040 --> 0:03:13.959 for the Pro models far longer than the regular models. 0:03:14.000 --> 0:03:17.240 That's a very good indicator of demand. Also, this is 0:03:17.240 --> 0:03:20.000 not an exaggeration. You go to an Apple store, there 0:03:20.040 --> 0:03:22.600 have been lines around the block for days still for 0:03:22.639 --> 0:03:25.000 the Pro Models. You ask people which phone are you 0:03:25.040 --> 0:03:28.240 here to line up for? You ask fifty people, I 0:03:28.280 --> 0:03:30.680 would say, maybe forty eight or forty nine of them 0:03:30.720 --> 0:03:32.920 are there for the pro phones, not the regular fourteen 0:03:33.280 --> 0:03:35.280 all right, thanks to bloombugs Matt Gum and I want 0:03:35.280 --> 0:03:37.640 to stick with this story and bring in forest to research. 0:03:37.760 --> 0:03:42.880 Vice president Julie asked, Julie, this is interesting because no 0:03:42.920 --> 0:03:46.600 matter what the environment, people buy iPhones around the world. 0:03:46.680 --> 0:03:50.560 What's your read on what bloombug reported over overnight? Yes, 0:03:50.840 --> 0:03:52.760 thank you. So I think there's a number of factors. 0:03:52.800 --> 0:03:54.520 So I think the first one is always you know, 0:03:54.600 --> 0:03:58.640 we know that Apple's iPhone owners and buyers are more 0:03:58.720 --> 0:04:01.280 affluent than the of and Android. Even if you just 0:04:01.280 --> 0:04:03.600 look in the U S alone, the average household income 0:04:03.680 --> 0:04:06.680 of an iPhone owner is eighty eight thousand dollars versus 0:04:06.680 --> 0:04:10.000 seventy nine for Android. UH. Thirty two percent of households 0:04:10.000 --> 0:04:12.240 that own an iPhone have a household income of more 0:04:12.280 --> 0:04:14.960 than a hundred thousand dollars a year. For Android, that's 0:04:14.960 --> 0:04:17.880 twenty three percent. UH. And final point there is, if 0:04:17.920 --> 0:04:19.640 you look at households with an income of over three 0:04:20.040 --> 0:04:23.719 thousand dollars annually, three percent for the iPhone and only 0:04:23.720 --> 0:04:26.080 one percent for Android. So I think that's you know, 0:04:26.120 --> 0:04:27.480 the top of the list. We know, and there's a 0:04:27.480 --> 0:04:30.360 lot of data that shows that simply iPhone owners are 0:04:30.480 --> 0:04:35.039 more affluent than those that are purchasing an Android. I 0:04:35.080 --> 0:04:37.040 think the second thing that comes into the mix is 0:04:37.080 --> 0:04:40.120 the upgrade cycle. Last year and this year has been 0:04:40.160 --> 0:04:42.280 an interesting time because a lot of carriers shut down 0:04:42.360 --> 0:04:44.680 three G and they forced an upgrade. So when we 0:04:44.720 --> 0:04:47.039 look at our data across the United States and Europe, 0:04:47.040 --> 0:04:51.320 anywhere from twenty five of consumers have purchased an iPhone 0:04:51.320 --> 0:04:53.159 in the past year, and I think it's a really 0:04:53.200 --> 0:04:56.760 substantial number, especially when you take into account that iPhone 0:04:56.760 --> 0:04:59.640 represents under fifty percent of share in each of those 0:04:59.640 --> 0:05:02.799 market once you get outside of the United States. And then, finally, 0:05:02.880 --> 0:05:04.520 to echo what Mark was saying, you know, when we 0:05:04.560 --> 0:05:06.360 look at it, we talked to our consumers. Six one 0:05:06.680 --> 0:05:09.440 of consumers expect that a recession is coming, and so 0:05:09.520 --> 0:05:12.600 they are slowing spending. We've got thirty of US online 0:05:12.600 --> 0:05:15.440 adults saying we are going to spend less on electronics 0:05:15.480 --> 0:05:17.280 in the upcoming year. So there's a little bit of 0:05:17.360 --> 0:05:20.320 hesitation in the market um and consumers are pulling back 0:05:20.320 --> 0:05:22.599 on spending. Julie, we love having you on because you 0:05:22.640 --> 0:05:25.599 crunch the numbers. Let's take a step back, let's zoom 0:05:25.600 --> 0:05:28.960 out here. A lot of cell siders seem to be saying, well, 0:05:29.000 --> 0:05:36.080 I was always modeling nine units anyway, So what's changed. Yeah, 0:05:36.240 --> 0:05:37.800 I think it's it's hard to say, you know what, 0:05:37.960 --> 0:05:40.400 you know, the analysts were modeling. I think it's um. 0:05:40.480 --> 0:05:42.880 You know, certainly, there's always good reasons to think about 0:05:42.920 --> 0:05:45.960 why they could have grown the market. Um, certainly. You know, 0:05:46.240 --> 0:05:48.120 for example, one of the things that we know that 0:05:48.160 --> 0:05:52.120 if of consumers who buy Apple products only buy Apple products. 0:05:52.440 --> 0:05:54.839 So if they're buying a watch, if they're buying a tablet, 0:05:54.880 --> 0:05:57.359 if they're signing up for Apple one, they're more likely 0:05:57.400 --> 0:05:59.039 to be a smartphone owner, you know, an io as 0:05:59.080 --> 0:06:00.920 smartphone owner. So you know, it's fair to expect that 0:06:00.960 --> 0:06:03.240 Apple could have you know, predicted that they would have 0:06:03.279 --> 0:06:06.560 converted more Android users this year. And they've also got 0:06:06.600 --> 0:06:08.520 a very deep lineup that's capable of doing that and 0:06:08.560 --> 0:06:11.800 competing at lower price points. So again, I don't know 0:06:11.839 --> 0:06:13.360 what was going on when they did the end when 0:06:13.360 --> 0:06:15.960 they did the forecast, but there's you know, you know, 0:06:16.000 --> 0:06:17.840 six millions not a big number on top of ninety. 0:06:17.960 --> 0:06:19.920 You know, it's it's more than it's more than five, 0:06:19.920 --> 0:06:21.520 but it's not Demper said, it's not a big number. 0:06:22.279 --> 0:06:25.360 When we talk about global technology the prospects of a recession, 0:06:25.760 --> 0:06:28.320 we're trying to look for clues, right of what's happening 0:06:28.320 --> 0:06:32.120 with the global consumer. What do you see broadly in 0:06:32.160 --> 0:06:35.800 the smartphone market globally? Are their markets where the consumers weak? 0:06:35.920 --> 0:06:41.000 Are they're spending habits that are changing? Yes, so I think, 0:06:41.040 --> 0:06:42.760 you know, certainly when we look at the numbers and 0:06:42.760 --> 0:06:44.839 we're talking to consumers, where are you you know what 0:06:45.000 --> 0:06:47.719 concerns you write? Food is more expensive, you know, rents 0:06:47.760 --> 0:06:51.039 are up all right, Right, there's a few categories you 0:06:51.080 --> 0:06:53.160 know that I would say are certainly more essential than 0:06:53.200 --> 0:06:56.000 having the latest and greatest smartphone. Um but again, like 0:06:56.080 --> 0:06:57.880 you know, keep in mind, you know, the upgrades, like 0:06:57.880 --> 0:07:00.800 these phones are amazing, amazing feats of engineering. There are 0:07:00.800 --> 0:07:03.640 amazing devices, whether it's an iPhone device or it's you know, 0:07:03.680 --> 0:07:06.880 one of the latest Android devices. Consumers are hanging onto 0:07:06.920 --> 0:07:09.800 these vices for you know, two, three, four years, and 0:07:09.840 --> 0:07:12.760 so that we saw consumers in United States buy an 0:07:12.760 --> 0:07:15.600 iPhone in the last twelve months is astounding on its own, 0:07:15.600 --> 0:07:17.320 and so that also could be contributing to a little 0:07:17.320 --> 0:07:19.720 bit of softer demands at you know, all of the 0:07:19.760 --> 0:07:23.160 price points as we go into the end of all right, 0:07:23.480 --> 0:07:26.760 forest to Research Vice President Julie Arsk, Thank you very much. 0:07:27.360 --> 0:07:31.119 Coming up Amazon's ambient intelligence, how the company is looking 0:07:31.160 --> 0:07:35.080 to a more personalized and proactive future in its devices. 0:07:35.080 --> 0:07:39.480 Our conversation with Amazon's Dave Limp. Next, This is Bloomberg. 0:07:50.280 --> 0:07:53.480 On Wednesday, Amazon held its full Hardware event, where announced 0:07:53.520 --> 0:07:55.960 a bunch of new gadgets. I caught up with Dave Limp, 0:07:56.000 --> 0:07:59.440 amazon senior vice president for Devices and Services, right after 0:07:59.480 --> 0:08:02.320 the event and also about the company's strategy. With so 0:08:02.400 --> 0:08:06.640 much competition in the space, what we're trying to do 0:08:06.720 --> 0:08:10.320 is build devices and services that mostly focused on the home, 0:08:10.360 --> 0:08:13.720 although increasingly in the car. That follow the pattern of 0:08:13.760 --> 0:08:16.400 what we call ambient intelligence, which is the ability for 0:08:16.800 --> 0:08:20.800 devices to be very very useful to customers when they're 0:08:20.840 --> 0:08:22.840 in the foreground and when they need it, but when 0:08:22.880 --> 0:08:25.280 you're not using it, they kind of disappear in the background. 0:08:25.320 --> 0:08:27.320 And when we're doing when we're at our best, we're 0:08:27.320 --> 0:08:30.320 allowing customers to pick their heads up, enjoy the real world, 0:08:30.400 --> 0:08:33.480 enjoy their families, and let technology help that rather than 0:08:33.600 --> 0:08:36.240 being you know, absorbed in their phones or out in 0:08:36.440 --> 0:08:40.080 some metaverse somewhere. With inflation such as it is around 0:08:40.080 --> 0:08:43.280 the world, higher input costs. How conscious a decision was 0:08:43.360 --> 0:08:47.680 that with pricing to not raise prices with certain product lines. 0:08:49.880 --> 0:08:51.839 I think we're always trying to you know, since the 0:08:51.960 --> 0:08:55.120 very beginning, our first Kindle, we've we have fifteen years ago, 0:08:55.200 --> 0:08:57.960 we've tried to make our products as affordable as possible, 0:08:58.040 --> 0:09:00.600 you know. We our strategy has been the same since 0:09:00.640 --> 0:09:02.560 the very beginning, which is we want to make money 0:09:02.600 --> 0:09:05.840 when customers use their products, not necessarily when they buy them. 0:09:05.880 --> 0:09:09.200 And so uh, we we are obviously looking always looking 0:09:09.200 --> 0:09:12.720 at commodity costs. But but part of the ability to 0:09:12.760 --> 0:09:16.280 pass on that value to customers is that the businesses 0:09:16.320 --> 0:09:18.599 at a scale where we can buy in volume and 0:09:18.720 --> 0:09:20.760 and we want to give that value back to customers 0:09:20.760 --> 0:09:23.440 wherever possible. You mentioned the Kindle. It's a bit of 0:09:23.440 --> 0:09:26.840 a throwback, right, the first Amazon device, and you've added 0:09:26.840 --> 0:09:30.880 a stylus interesting products. What's the strategy with that. Do 0:09:30.920 --> 0:09:35.080 you think that this is going to be a volume seller? Well, 0:09:35.160 --> 0:09:38.240 Kindle Scribe is in some ways, it's the Kindle we've 0:09:38.280 --> 0:09:40.400 always wanted to build, you know, and we have some 0:09:40.400 --> 0:09:43.200 great kindles we just announced some last last two weeks 0:09:43.200 --> 0:09:46.400 ago that are at but this one, as you mentioned, 0:09:46.440 --> 0:09:49.199 it's the first kindle you can write on, and it 0:09:49.240 --> 0:09:53.120 has a ten point three inch display that's incredibly high resolution. 0:09:54.040 --> 0:09:56.959 I but also as a stylist, and one that doesn't 0:09:56.960 --> 0:09:59.160 have a battery. You don't have to sink. It just works. 0:09:59.480 --> 0:10:03.640 And when write on Kindle Scribe, it really does feel 0:10:03.640 --> 0:10:06.320 like you're writing on paper. It's something that's amazing. You 0:10:06.400 --> 0:10:08.920 kind of have to try it to see it. And uh, 0:10:08.960 --> 0:10:12.000 you know, I never try to predict volumes. Uh. What 0:10:12.040 --> 0:10:13.959 we try to do is build great products and let 0:10:14.000 --> 0:10:16.920 customers speak for themselves. I know for sure that I 0:10:16.960 --> 0:10:19.319 will be buying one of these, You'll be buying one. 0:10:19.360 --> 0:10:22.360 But around the world that the consumer is feeling pain 0:10:22.559 --> 0:10:26.040 and at the same time there's evidence that consumer is 0:10:26.080 --> 0:10:28.480 all still spending at the higher end of the market. 0:10:28.520 --> 0:10:31.160 What are you saying in the markets that you operate 0:10:31.200 --> 0:10:33.600 in and the spending habits of consumers where they are 0:10:33.960 --> 0:10:40.360 putting cash awar to holding back. Yeah, obviously, we our 0:10:40.400 --> 0:10:42.840 first signal was a couple of months ago with Prime Day. 0:10:42.920 --> 0:10:45.400 We had we had a good Prime day. For my 0:10:45.520 --> 0:10:50.040 part of Amazon's business, we uh. I think customers tend 0:10:50.120 --> 0:10:54.440 to look for value in times when the economy is tougher. 0:10:54.920 --> 0:10:57.400 It's hard to predict what's going to happen as we 0:10:57.440 --> 0:10:59.520 go into queue four. There's no question that there is 0:10:59.600 --> 0:11:03.160 tightening in the economy. Um, But I think what the 0:11:03.200 --> 0:11:05.040 best thing we can do is get our inputs right 0:11:05.160 --> 0:11:07.440 and build products that we think customers are gonna love. 0:11:07.480 --> 0:11:11.199 Price them, as you mentioned earlier, crisply so that they're affordable, 0:11:11.679 --> 0:11:14.000 and then you know the rest is going to be 0:11:14.080 --> 0:11:17.719 up to up to the consumer. But I have I'm 0:11:17.800 --> 0:11:21.040 internal optimists, but I have a high level conviction there's 0:11:21.040 --> 0:11:23.360 going to be a lot of echoes and kindles and 0:11:23.440 --> 0:11:25.840 other products under people's trees this year. The deal with 0:11:25.920 --> 0:11:28.599 I Robot, I think we've got used last week that 0:11:28.679 --> 0:11:33.400 the FTC has made a second request for additional information. 0:11:33.880 --> 0:11:37.000 How optimistic are you that deal gets done and how 0:11:37.040 --> 0:11:42.000 important is I Robot. Well, obviously we have to go 0:11:42.040 --> 0:11:44.920 through approve the approval cycles around the world, and until 0:11:44.960 --> 0:11:47.600 we do get through, those will continue to operate at 0:11:47.720 --> 0:11:51.240 arm's length as separate companies. But you know, I wouldn't 0:11:51.800 --> 0:11:54.839 have ever kind of sat down with Colin, if we 0:11:54.880 --> 0:11:57.160 didn't have optimism that we could get the get the 0:11:57.240 --> 0:12:01.320 transaction done. Colin, who's the CEO of I Robot, is 0:12:01.360 --> 0:12:04.800 the kind of the most missionary entrepreneur, one of the 0:12:04.840 --> 0:12:07.480 most missionary entrepreneurs I've ever met, and I look forward 0:12:07.520 --> 0:12:11.000 to once we consummate the transaction to working with them 0:12:11.000 --> 0:12:15.760 even closer. You have really expanded the devices offering in 0:12:15.800 --> 0:12:18.480 recent years. There's so many product lines, product type. We 0:12:18.520 --> 0:12:21.400 didn't even get onto the new TVs um and some 0:12:21.480 --> 0:12:23.520 of the other devices aimed at kids. But all that 0:12:23.559 --> 0:12:27.120 makes me think about your manufacturing footprint print globally. Now 0:12:28.040 --> 0:12:31.320 let's talk semiconductors. You know, how is supply chain for you? 0:12:31.400 --> 0:12:34.760 How is manufacturing and how are access to key chips 0:12:34.800 --> 0:12:39.160 that you need to go into these devices. I think 0:12:39.200 --> 0:12:42.160 we're coming out at the other end of at least 0:12:42.160 --> 0:12:45.840 for the products that are under my purview, of the 0:12:45.880 --> 0:12:48.839 worst of the supply train crisis. I don't think it's 0:12:48.880 --> 0:12:52.160 by any means over We still see disruptions in the 0:12:52.160 --> 0:12:56.720 worldwide transportation network, especially if you're throwing things on ocean. 0:12:57.360 --> 0:13:02.240 UH and certain chip sets are still in shorter supply, 0:13:02.679 --> 0:13:05.880 but some of the more critical components, UH, you know, 0:13:06.240 --> 0:13:09.120 systems on a chip, the actual processors and our products. 0:13:09.800 --> 0:13:12.520 The supply looks brighter for them. When you look at 0:13:12.640 --> 0:13:16.000 UH display panels for things like tablets and TVs, that 0:13:16.120 --> 0:13:19.640 supply looks better than it did a year ago. So again, 0:13:19.679 --> 0:13:21.880 I don't think we're through it, but I can start 0:13:21.960 --> 0:13:25.000 seeing a light at the end of the tunnel. That 0:13:25.120 --> 0:13:28.640 was Amazon's Dave Limp. Let's stick with Amazon's product unvailing 0:13:28.679 --> 0:13:31.600 and bring in Tom Forte if d a Davidson Tom 0:13:31.600 --> 0:13:33.839 a lot of products, some of them are faceless, right 0:13:33.960 --> 0:13:36.400 upgrades to existing lines. Some of them are You did 0:13:36.400 --> 0:13:39.560 any of that move the needle for you? Sure? So 0:13:39.640 --> 0:13:41.959 when I think about their strategy, I think of them 0:13:42.000 --> 0:13:44.280 as the low cost or one of the low cost 0:13:44.360 --> 0:13:48.199 providers of hardware and the consumer electronics space. I think 0:13:48.200 --> 0:13:49.960 it's about time, and I think it should be a 0:13:50.040 --> 0:13:54.080 very popular product that they're adding a stylus to the Kindle. 0:13:54.600 --> 0:13:57.800 When I think of their different lines of consumer electronics products, 0:13:57.920 --> 0:14:03.040 Kindle's probably probably we're we would say Amazon is most dominant. Otherwise, 0:14:03.040 --> 0:14:05.240 when you think about a lot of their echo devices. 0:14:05.720 --> 0:14:07.880 The good news is that Amazon makes a lot of 0:14:07.920 --> 0:14:12.280 devices that leverage Alexa, but a lot of other consumer 0:14:12.280 --> 0:14:15.320 electronic companies do too, So I think when you think 0:14:15.320 --> 0:14:18.360 about the products that are leveraging Alexa, it isn't just 0:14:18.559 --> 0:14:21.240 what Amazon is doing on the Echo device line, but 0:14:21.320 --> 0:14:24.440 the fact that so many manufacturers think so Nos as 0:14:24.440 --> 0:14:28.880 an example, are making products integrated with Alexa. That's the 0:14:28.880 --> 0:14:31.240 important thing there. So that was kind of my initial 0:14:31.280 --> 0:14:34.560 take on their new hardware offering. And I'm fascinated at 0:14:34.560 --> 0:14:36.920 the Astro and I'm glad you talked to him about 0:14:36.920 --> 0:14:40.120 the i robot acquisition. So what is it about the 0:14:40.200 --> 0:14:43.800 roomba that attracted Amazon and why does it feel like 0:14:43.840 --> 0:14:46.680 it needed to make an acquisition there rather than extend 0:14:46.720 --> 0:14:49.480 what it's already doing with the Astro line up. The 0:14:49.560 --> 0:14:52.800 timing of this is interesting because we've just had news 0:14:52.880 --> 0:14:56.680 of a second Prime Day essentially next month. Do you 0:14:56.720 --> 0:14:59.480 expect consume is right now around the world to rush 0:14:59.480 --> 0:15:04.880 out and alot these Amazon devices? Yes and no. So 0:15:04.880 --> 0:15:07.400 so let's start with the second prime Day in one 0:15:07.520 --> 0:15:10.600 calendar year. So it's a long time student of Amazon. 0:15:10.840 --> 0:15:13.960 I remember when they had the first Prime Day and 0:15:14.000 --> 0:15:16.320 it was in July, and the reason was they wanted 0:15:16.360 --> 0:15:19.080 to test their logistics to see if they were ready 0:15:19.120 --> 0:15:23.080 for their big sales days Black Friday Cyber Monday. So, 0:15:23.160 --> 0:15:27.720 in my opinion, having two Prime days encounter is actually 0:15:27.720 --> 0:15:29.920 a sign of weakness. It means that they need a 0:15:29.960 --> 0:15:32.120 sale because their sales are not doing as well as 0:15:32.120 --> 0:15:34.560 they hope for. I also think they want to leverage 0:15:34.600 --> 0:15:37.160 their logistics to get as much of a return on 0:15:37.200 --> 0:15:40.600 that investment. So do I think investors or consumers rather 0:15:40.600 --> 0:15:43.880 will gobble up their consumer electronics devices at a second 0:15:43.880 --> 0:15:47.960 Prime Day? Generally speaking, they do well with Amazon devices 0:15:48.000 --> 0:15:50.400 on Prime Day, but as it pertains to the sales 0:15:50.400 --> 0:15:52.760 trends in general on the stock, I'm concerned that they're 0:15:52.760 --> 0:15:54.840 having two sales in one year. I think that's a 0:15:54.840 --> 0:15:58.440 negative sign. Tom. I wouldn't you give me an explanation 0:15:58.480 --> 0:16:01.720 of why we care about Amazon devices business. They price 0:16:01.800 --> 0:16:04.920 them competitively, right, But it seems to me the idea 0:16:04.960 --> 0:16:07.840 here is just to bring more people into Prime, more 0:16:07.880 --> 0:16:11.200 people using Alecta products. They're not actually so focused on 0:16:11.280 --> 0:16:14.200 making money through the hardware, are they. You know, they're 0:16:14.200 --> 0:16:17.960 definitely the opposite of Apple, where Apple makes the majority 0:16:17.960 --> 0:16:21.480 of its revenue from its hardware sales. For Amazon hardware 0:16:21.520 --> 0:16:24.600 is essentially an enabler. What can I give a consumer 0:16:24.920 --> 0:16:27.080 that will make it easier for them to buy products 0:16:27.080 --> 0:16:29.560 on Amazon? What can I give a consumer that will 0:16:29.600 --> 0:16:33.520 make it easier for them to watch videos on Amazon? So, 0:16:33.760 --> 0:16:37.440 in that regard, not the profit neutle mover. Certainly it 0:16:37.600 --> 0:16:40.360 is for Apple, but it can have a positive impact 0:16:40.440 --> 0:16:43.040 on their e commerce sales to the extent that everything 0:16:43.040 --> 0:16:44.880 they do makes it easier for the consumers to buy 0:16:44.920 --> 0:16:48.560 products through Amazon. Hey, Tom, really quickly, you were concerned 0:16:48.600 --> 0:16:51.120 about the mixed reception for Rings of Power. I've been 0:16:51.160 --> 0:16:54.800 watching Rings of Power. Have the episode so far changed 0:16:54.800 --> 0:16:57.960 your mind? Okay, So I'm publishing a note tomorrow where 0:16:57.960 --> 0:17:00.440 I'm gonna talk about how I essentially felt sleep in 0:17:00.440 --> 0:17:03.960 episodes one, three, and four, and have a much episode five. Yet, 0:17:04.359 --> 0:17:08.400 So with approval rating and written Tomatoes, I'm very concerned 0:17:08.440 --> 0:17:13.000 about the billion dollars investment been made. Tom Forte, harsh 0:17:13.080 --> 0:17:16.120 critic of d A. Davidson. Of course, thank you very much. 0:17:24.800 --> 0:17:28.040 Elon Musk asked a federal appeals court to throw out 0:17:28.080 --> 0:17:31.359 the deal he made with the SEC in eighteen over 0:17:31.359 --> 0:17:36.160 a so called Twitter sitter. Since a Tesla lawyer has 0:17:36.200 --> 0:17:40.399 screened all of Musque company related tweets. We believe after 0:17:40.440 --> 0:17:44.439 a tweet about taking Tesla private forced the SEC to act. 0:17:44.920 --> 0:17:47.919 Musk calls the Twitter Sitter agreement and a legal effort 0:17:47.960 --> 0:17:51.960 to muzzle him, adding that it's hindering his freedom of speech. 0:17:52.160 --> 0:17:55.560 A judge refused Musque's last plea to end the Twitter 0:17:55.680 --> 0:18:00.440 sist a deal back in April, and Tesla's did Joe 0:18:00.440 --> 0:18:03.479 Gibier as a board member. Gabier is the co founder 0:18:03.480 --> 0:18:07.040 of Airbnb and last fourteen years has helped launch Airbnb's 0:18:07.080 --> 0:18:11.719 design studio and airbnb dot org, the company's nonprofit foundation. 0:18:12.080 --> 0:18:14.280 He recently stepped back from his full time role in 0:18:14.320 --> 0:18:18.960 operations to pursue other ventures. Gibier replaces Larry Ellison on 0:18:19.000 --> 0:18:22.720 the board, and General Mills, the maker of Cinnamon Toast 0:18:22.760 --> 0:18:26.800 Crunch and Annie's Box Pastors, is backing food tech startup 0:18:27.040 --> 0:18:30.040 grub Market. San Francisco based grub Market has raised a 0:18:30.160 --> 0:18:32.880 hundred and twenty million dollars in new equity from General 0:18:32.920 --> 0:18:36.400 Mills and other investors, including Tiger Global, and a two 0:18:36.440 --> 0:18:39.919 billion dollar valuation. The startup offers software and an e 0:18:39.920 --> 0:18:44.440 commerce platform connecting farmers and key food suppliers with customers. 0:18:44.680 --> 0:18:48.800 Grub Market operates all across the US, South America, Asia, Europe, 0:18:48.800 --> 0:18:51.119 and Africa, and i p O could also be on 0:18:51.160 --> 0:18:54.679 the horizon with grub Market holding talks with underwriters. Bloomberg 0:18:54.840 --> 0:19:05.919 has reported this is Bloomberg Technology. I'm Ed Ludlow in 0:19:05.920 --> 0:19:09.320 New York. The popular messaging platform WhatsApp is more than 0:19:09.359 --> 0:19:12.879 just an encryptive messaging app connecting people worldwide. It's become 0:19:13.160 --> 0:19:16.800 a major part of Wall Street communication. That's why regulators 0:19:16.800 --> 0:19:19.800 reach settlements with a dozen banks for failing to monitor 0:19:19.840 --> 0:19:24.640 employees communications on on unauthorized messaging apps like WhatsApp. Wall 0:19:24.680 --> 0:19:26.960 Street has been hit with more than two billion dollars 0:19:27.000 --> 0:19:31.479 of fines and what's become called the WhatsApp investigation. Goldman Sachs, 0:19:31.520 --> 0:19:34.920 Bank of America and City Group were among those penalized. 0:19:34.920 --> 0:19:38.359 Bloomberg Street are Naturation is covering this story. Let's go 0:19:38.359 --> 0:19:41.160 back to the beginning. What is the activity and which 0:19:41.200 --> 0:19:43.600 apps are we talking about here? Again? And that's important 0:19:43.640 --> 0:19:45.920 because why we call it the WhatsApp problem. It's important 0:19:45.960 --> 0:19:48.800 that listeners understand that what we're really talking about is 0:19:48.840 --> 0:19:53.080 something that's dubbed or WhatsApp broke effectively, regulators want banks 0:19:53.080 --> 0:19:56.320 to ensure that they're monitoring all these messaging apps. They 0:19:56.320 --> 0:19:58.840 are worried about the unauthorized use of these apps. So 0:19:59.160 --> 0:20:01.680 WhatsApp is one prominent example, but it could be Signal, 0:20:01.760 --> 0:20:03.960 could be telegramed, it could be any one of these 0:20:04.000 --> 0:20:07.160 apps that have gotten pop so popular in recent years. 0:20:07.320 --> 0:20:10.000 A lot of the communication between bankers and traders, their 0:20:10.000 --> 0:20:14.119 clients just inside the film has gravitated to these platforms. 0:20:14.160 --> 0:20:17.840 But archiving these chats, monitoring these chats, and compliance has 0:20:17.880 --> 0:20:20.520 not kept pace with the growth and technology. There is 0:20:20.520 --> 0:20:22.960 this a pandemic story where we're all sort of at home, 0:20:23.040 --> 0:20:25.040 out of your office and communicating with each other in 0:20:25.080 --> 0:20:28.320 new ways. Or does it pre date that the pandemic 0:20:28.400 --> 0:20:30.520 is an accelerator for sure, But I think it's more 0:20:30.520 --> 0:20:33.720 of a technology story. You have just gotten used to 0:20:33.800 --> 0:20:36.520 the idea that people are just more comfortable using these 0:20:36.560 --> 0:20:39.760 apps to communicate. Even someone sitting two seats down from you, 0:20:39.760 --> 0:20:42.119 you're more likely to send them a message rather than 0:20:42.160 --> 0:20:44.840 pick up the phone and call them or email them. 0:20:44.880 --> 0:20:47.320 That's why there's so much focus on these apps. And 0:20:47.359 --> 0:20:49.679 of course the pandemic played a role because you had 0:20:49.720 --> 0:20:53.080 a disparate situation where everyone left the officers, the officers 0:20:53.160 --> 0:20:55.920 emptied out, and everyone is at home. And when you're 0:20:55.920 --> 0:20:58.159 at home, you're more likely to be more comfortable with 0:20:58.200 --> 0:21:00.440 the kind of apps you use anywhere when you're outside 0:21:00.440 --> 0:21:04.479 your usual eight to six schedule. These fines, seeing big, 0:21:04.720 --> 0:21:09.040 big numbers, why so hefty? It's extraordinary? Two billion dollars 0:21:09.040 --> 0:21:12.159 cost your mind. Eight years back, when Mark Zuckerberg wanted 0:21:12.200 --> 0:21:14.919 to buy WhatsApp, we were all scratching our heads as 0:21:14.920 --> 0:21:17.000 to why they would buy something like that for twenty 0:21:17.000 --> 0:21:20.359 billion dollars in two Now we're talking about a fine 0:21:20.400 --> 0:21:23.399 that cruise as much as two billion dollars that in 0:21:23.480 --> 0:21:26.920 some ways it's truly crazy, because the previous highest fine 0:21:26.960 --> 0:21:30.040 for something like this, which is effectively a record keeping laps, 0:21:30.480 --> 0:21:33.880 was fifteen million dollars one five for Morgan Stanley back 0:21:33.880 --> 0:21:35.880 in two thousand and six. Now each and every bank, 0:21:35.920 --> 0:21:37.679 at least the big banks are coming out there and 0:21:37.680 --> 0:21:40.680 paying two million dollars. This is the kind of fine 0:21:40.720 --> 0:21:43.680