1 00:00:01,880 --> 00:00:02,600 Speaker 1: From Marhard. 2 00:00:02,759 --> 00:00:06,720 Speaker 2: We're Innovation, Money and Power Collie in Silicon. 3 00:00:06,320 --> 00:00:07,200 Speaker 1: Valley, NBN. 4 00:00:07,520 --> 00:00:11,560 Speaker 3: This is Bloomberg Technology with Caroline Hyde and Ed Ludlow. 5 00:00:25,640 --> 00:00:28,000 Speaker 4: I'm Caroline Heider Bloomberg's World head quarters in New York, 6 00:00:28,400 --> 00:00:30,200 Speaker 4: and I met Ludlow in San Francisco. 7 00:00:30,360 --> 00:00:32,160 Speaker 5: This is Bloombay Technology. 8 00:00:31,720 --> 00:00:34,880 Speaker 4: Coming up after staying out of public view for years. 9 00:00:35,159 --> 00:00:37,000 Speaker 6: Ali Baba founder Jack mart. 10 00:00:36,680 --> 00:00:38,960 Speaker 4: He speaks out to his own employees, urging them to 11 00:00:38,960 --> 00:00:41,440 Speaker 4: correct the company's course. We'll have more on the e 12 00:00:41,479 --> 00:00:45,760 Speaker 4: commerce giants' plans to compete with rivals like PDD, and. 13 00:00:45,720 --> 00:00:48,680 Speaker 7: We'll hear from Amazon Web Services CEO Adam Zelipski off 14 00:00:48,720 --> 00:00:52,760 Speaker 7: the back of the company's Reinvent conference discussing AI, Nvidia, 15 00:00:53,000 --> 00:00:53,680 Speaker 7: and a lot more. 16 00:00:53,920 --> 00:00:56,800 Speaker 4: Plus Apple offers Gommen Sachs an exit ramp for its 17 00:00:56,840 --> 00:01:00,520 Speaker 4: troubled card partnership. We'll bring you those details so much 18 00:01:00,560 --> 00:01:02,880 Speaker 4: more throughout the hour. Let's just go to what this 19 00:01:03,000 --> 00:01:05,280 Speaker 4: macro picture looks like. We're just looking through the bond market. 20 00:01:05,280 --> 00:01:07,520 Speaker 4: We're looking at the impact on the tech sector. More broadly, 21 00:01:07,640 --> 00:01:10,319 Speaker 4: Let's launches is with us senior portfolio manager over at 22 00:01:10,360 --> 00:01:14,120 Speaker 4: Invesco and Well and the amount of run up that 23 00:01:14,160 --> 00:01:16,679 Speaker 4: we've seen in tech stocks has been phenomenal for November, 24 00:01:16,800 --> 00:01:18,600 Speaker 4: and we know how much it's led the benchmarks. 25 00:01:18,680 --> 00:01:20,160 Speaker 6: Is this going to continue? From your perspective? 26 00:01:21,200 --> 00:01:24,320 Speaker 8: Thank you Karen and Ed for having me. We think 27 00:01:24,360 --> 00:01:29,880 Speaker 8: actually the global yield backdrop that you just highlighted is 28 00:01:30,040 --> 00:01:34,520 Speaker 8: likely to stimulate a cyclical rebound into your end and 29 00:01:34,720 --> 00:01:38,360 Speaker 8: into next year. As you alluded to, tech has been 30 00:01:38,440 --> 00:01:45,160 Speaker 8: driven primarily by obviously a thematic focused artificial intelligence narrative 31 00:01:45,200 --> 00:01:49,280 Speaker 8: and also supported by the declining global bond yields as 32 00:01:49,320 --> 00:01:52,200 Speaker 8: of late. But what we think is really happening is 33 00:01:52,240 --> 00:01:55,240 Speaker 8: that this declining bond yield will lead a cyclical rebound 34 00:01:55,240 --> 00:01:58,640 Speaker 8: because it's primarily driven by a fall in inflation expectations 35 00:01:58,680 --> 00:02:03,640 Speaker 8: and actual inflation, which will in our mind create a 36 00:02:03,680 --> 00:02:06,640 Speaker 8: more supporting narrative for a soft lending and therefore allow 37 00:02:07,000 --> 00:02:10,520 Speaker 8: market participants to believe again in a cyclical rebound in 38 00:02:10,520 --> 00:02:13,280 Speaker 8: the cyclical sector. So we do think at tech as 39 00:02:13,280 --> 00:02:17,200 Speaker 8: are performed because if its quality characteristics is defensive characteristics, 40 00:02:17,240 --> 00:02:21,320 Speaker 8: it's higher duration characteristics. But now we do expect a 41 00:02:21,440 --> 00:02:24,200 Speaker 8: rotation more to the sectors and styles that have been 42 00:02:24,600 --> 00:02:29,639 Speaker 8: neglected and unloved such as smaller capitalizations and value oriented sectors. 43 00:02:30,240 --> 00:02:31,840 Speaker 4: Is banks one of those? We're just looking at a 44 00:02:31,840 --> 00:02:33,840 Speaker 4: banner at the moment. The FDIC coming out with its 45 00:02:33,880 --> 00:02:36,959 Speaker 4: annual report and actually talking about how profit profits bank 46 00:02:37,000 --> 00:02:41,160 Speaker 4: profits are dipping as they say ultimately that loans are 47 00:02:41,200 --> 00:02:43,480 Speaker 4: the next pain point at the moment they're seeing, and 48 00:02:44,120 --> 00:02:46,760 Speaker 4: most notably they're saying, the banking industry on this quarterly 49 00:02:46,800 --> 00:02:50,200 Speaker 4: focus has got some unrealized losses that are increasing in 50 00:02:50,240 --> 00:02:52,560 Speaker 4: the third quarter. So is it now the time to 51 00:02:52,600 --> 00:02:53,480 Speaker 4: be getting into banks? 52 00:02:54,800 --> 00:02:57,160 Speaker 8: I think you're alluding to a very important point. We 53 00:02:57,320 --> 00:03:00,519 Speaker 8: have now just dealt for over a year of yield 54 00:03:00,560 --> 00:03:05,639 Speaker 8: creve inversion, which we know creates a particularly challenging environment 55 00:03:05,760 --> 00:03:09,280 Speaker 8: for financials. The yell cre is beginning to rest deepen, 56 00:03:09,840 --> 00:03:14,799 Speaker 8: and if we do see rake cuts into next year, 57 00:03:15,760 --> 00:03:19,399 Speaker 8: a powerful resteeping of the Yil curve would improve materially 58 00:03:19,440 --> 00:03:22,480 Speaker 8: the four perspective on bank profits. 59 00:03:22,520 --> 00:03:23,359 Speaker 2: So we do. 60 00:03:23,560 --> 00:03:26,880 Speaker 8: Place financials and banks as part of the cyclical sector 61 00:03:26,880 --> 00:03:31,600 Speaker 8: that is likely to benefit together with others if our 62 00:03:31,720 --> 00:03:34,200 Speaker 8: thesis of a cyclical rebound and resteeping of the yell 63 00:03:34,280 --> 00:03:35,240 Speaker 8: curve does play out. 64 00:03:36,360 --> 00:03:39,200 Speaker 7: Let's see you take this kind of worldview from a 65 00:03:39,200 --> 00:03:42,520 Speaker 7: capital allocation standpoint, right, you are kind of more heavily 66 00:03:42,520 --> 00:03:46,640 Speaker 7: weighted toward equities. But the world of technology is big. 67 00:03:46,680 --> 00:03:50,000 Speaker 7: We just talked about China, We're increasingly talking about Europe. 68 00:03:50,320 --> 00:03:53,080 Speaker 7: How do you guys feel about tech in the United 69 00:03:53,160 --> 00:03:55,480 Speaker 7: States visa v Europe and parts of Asia. 70 00:03:57,520 --> 00:04:01,920 Speaker 8: Well, tech the clearest the expression from a global standpoint 71 00:04:01,960 --> 00:04:05,200 Speaker 8: of the tech theme or that quality theme that comes 72 00:04:05,280 --> 00:04:08,280 Speaker 8: with a large profit margins, large return on assets. It's 73 00:04:08,360 --> 00:04:11,520 Speaker 8: really a United States theme. When you go outside of 74 00:04:11,560 --> 00:04:17,680 Speaker 8: the United States, there is more smaller capitalizations companies that 75 00:04:17,800 --> 00:04:21,560 Speaker 8: are likely to benefit more from that cyclical rebound. But 76 00:04:22,000 --> 00:04:26,080 Speaker 8: it's really there is a bit of a polarization happening 77 00:04:26,080 --> 00:04:28,320 Speaker 8: in the structure of capital markets, as you allude to, 78 00:04:28,800 --> 00:04:31,880 Speaker 8: where being overweigh the United States relative to the rest 79 00:04:31,920 --> 00:04:35,359 Speaker 8: of the world basically means being overweight tech relative to 80 00:04:35,480 --> 00:04:39,440 Speaker 8: value relative to CIICL. Course, they are two manifestations of 81 00:04:39,600 --> 00:04:42,200 Speaker 8: the same risk and return profile. 82 00:04:43,640 --> 00:04:47,680 Speaker 7: Sometimes looking a little deeper tells a slightly different story. Right, 83 00:04:47,720 --> 00:04:49,400 Speaker 7: If you think about the S and P five hundred, 84 00:04:49,440 --> 00:04:53,840 Speaker 7: communications or information technology both up fifty percent year today, 85 00:04:54,320 --> 00:04:57,120 Speaker 7: but a lot of that attributable to the Magnificent seven. 86 00:04:57,440 --> 00:05:00,680 Speaker 7: You know, think about Microsoft and Apple achieve giving record 87 00:05:00,760 --> 00:05:04,400 Speaker 7: highs multiple times this year. How do you feel about that? 88 00:05:04,440 --> 00:05:07,080 Speaker 7: What does that tell you about the dynamic of this market. 89 00:05:08,960 --> 00:05:13,159 Speaker 8: It's reminiscent of many situations we've seen before where the 90 00:05:13,200 --> 00:05:16,440 Speaker 8: tech sector in particular is very prone to boost them 91 00:05:16,520 --> 00:05:20,880 Speaker 8: bus cycles by the very nature of where its return 92 00:05:20,960 --> 00:05:25,200 Speaker 8: expectations coming from. Right, these are growth stocks with that 93 00:05:25,360 --> 00:05:32,200 Speaker 8: tend to overreact to extrapolation of growth expectations. We have 94 00:05:32,360 --> 00:05:35,680 Speaker 8: seen a meaningful run up in the last six months, 95 00:05:35,720 --> 00:05:38,960 Speaker 8: and the decomposition of market returns that you just alluded 96 00:05:39,000 --> 00:05:42,680 Speaker 8: to clearly does not reflect the performance of the US economy. 97 00:05:42,760 --> 00:05:45,640 Speaker 8: Right The S and P five hundred, driven predominantly by 98 00:05:46,080 --> 00:05:50,920 Speaker 8: the disproportionate tech relative to other sectors, is not representative 99 00:05:50,920 --> 00:05:54,640 Speaker 8: of US economic performances represented of the tech sector, the 100 00:05:54,760 --> 00:05:58,760 Speaker 8: dynamics for the market going forward, We believe that there 101 00:05:58,760 --> 00:06:02,000 Speaker 8: needs to be a rebalance from those Magnificent seven and 102 00:06:02,080 --> 00:06:07,960 Speaker 8: rebalancing where there's more participation, wider leadership rather than narrow 103 00:06:08,000 --> 00:06:12,680 Speaker 8: leadership across sectors and industries that should be more reflective 104 00:06:12,839 --> 00:06:15,440 Speaker 8: of the outperformance that we do see for the global 105 00:06:15,480 --> 00:06:18,160 Speaker 8: economy and the recovery that we do see for the 106 00:06:18,279 --> 00:06:21,000 Speaker 8: US economy. So the positive news is that despite a 107 00:06:21,560 --> 00:06:23,640 Speaker 8: P five hundred being up twenty percent of the day, 108 00:06:24,120 --> 00:06:26,640 Speaker 8: we believe that that is not reflective of a cyclical 109 00:06:26,720 --> 00:06:29,240 Speaker 8: rebound that we see in the cards, and that cyclical 110 00:06:29,240 --> 00:06:32,520 Speaker 8: rebounds still has plenty of room to be priced in 111 00:06:32,880 --> 00:06:37,120 Speaker 8: through a rotation within smaller capitalizations, more cyclical sectors, and 112 00:06:37,240 --> 00:06:39,599 Speaker 8: value oriented companies within the equity market. 113 00:06:40,760 --> 00:06:44,839 Speaker 4: Talking about this real orientation, it's interesting, colleague John Author's 114 00:06:44,960 --> 00:06:47,400 Speaker 4: was writing about if you still believe in a run 115 00:06:47,480 --> 00:06:51,359 Speaker 4: up in overall technology but not the magnificent seven, the 116 00:06:51,400 --> 00:06:54,400 Speaker 4: way to play that is equal weighted benchmarks rather than 117 00:06:54,480 --> 00:06:57,880 Speaker 4: going for those ones that take into account the actual 118 00:06:58,279 --> 00:07:01,000 Speaker 4: overall market capitalization these behemoths. 119 00:07:01,680 --> 00:07:03,760 Speaker 6: Is that something that you're seeing plaid a little bit more. 120 00:07:03,880 --> 00:07:06,560 Speaker 4: Is there other ways that you can still remain exposed 121 00:07:06,600 --> 00:07:09,440 Speaker 4: to technology but tactically be more long some of the 122 00:07:09,480 --> 00:07:12,160 Speaker 4: areas that have been beaten off of late No. 123 00:07:12,280 --> 00:07:14,040 Speaker 8: I think that's very well said, and it hits the 124 00:07:14,120 --> 00:07:16,040 Speaker 8: nail in the head if you if you look at 125 00:07:16,160 --> 00:07:21,320 Speaker 8: equally weighted type of strategies within within tech relative to 126 00:07:21,440 --> 00:07:25,560 Speaker 8: the market. What they will deliver is is a smaller 127 00:07:25,600 --> 00:07:29,200 Speaker 8: capitalization bias and a more value orientation. So also when 128 00:07:29,240 --> 00:07:32,480 Speaker 8: you look at the breakdown of large cup growth versus 129 00:07:32,520 --> 00:07:35,000 Speaker 8: mid cup growth and small cup growth, you can clearly 130 00:07:35,080 --> 00:07:40,000 Speaker 8: see that smaller capitalization effect. So I think it's it's 131 00:07:40,080 --> 00:07:44,160 Speaker 8: for for a portfolio manager, for a portfolio strategy that 132 00:07:45,160 --> 00:07:47,400 Speaker 8: want that needs to have, and wants to retain a 133 00:07:47,480 --> 00:07:53,040 Speaker 8: dedicated technology exposure. Rebalancing within that strategy towards smaller capitalization 134 00:07:53,760 --> 00:07:57,400 Speaker 8: and cheaper evaluations is the way to maintain that exposure 135 00:07:57,440 --> 00:08:01,120 Speaker 8: and participate to that broadening of the seclical rebound. 136 00:08:02,240 --> 00:08:05,240 Speaker 7: Alessia the longest of Investco just a deep, smart take 137 00:08:05,280 --> 00:08:06,400 Speaker 7: on the technology sector. 138 00:08:06,520 --> 00:08:06,840 Speaker 5: Thank you. 139 00:08:14,880 --> 00:08:18,280 Speaker 4: Ali Baba founder Jack ma is actually speaking out two 140 00:08:18,320 --> 00:08:21,280 Speaker 4: employees at the company and an internal message urging Ali 141 00:08:21,320 --> 00:08:23,720 Speaker 4: Baba to quote correct its course. 142 00:08:24,240 --> 00:08:25,880 Speaker 6: We wanted to get into what all of this means. 143 00:08:25,920 --> 00:08:27,880 Speaker 4: Want to bring in blombergs, Henry Ren and Isabel Lee 144 00:08:27,880 --> 00:08:30,320 Speaker 4: and Isabelle I start with you because is this a 145 00:08:30,480 --> 00:08:33,200 Speaker 4: rallying cry? Is this sort of in any way a 146 00:08:33,320 --> 00:08:36,040 Speaker 4: negative impact? I mean, what does this do to morale 147 00:08:36,120 --> 00:08:39,120 Speaker 4: when he's bigging up competitors saying that there's an opportunity 148 00:08:39,160 --> 00:08:41,760 Speaker 4: in AI. Is he meant to be sort of helping 149 00:08:42,080 --> 00:08:43,640 Speaker 4: with morale or detracting from it. 150 00:08:43,920 --> 00:08:45,800 Speaker 9: So this is really interesting and had shocked a lot 151 00:08:45,840 --> 00:08:48,880 Speaker 9: of investors because remember in twenty twenty, jackmar largely stepped 152 00:08:48,880 --> 00:08:52,000 Speaker 9: away from public eye when he criticized Chinese regulators, so 153 00:08:52,040 --> 00:08:55,040 Speaker 9: many articles were like where is Jack ma? And today 154 00:08:55,040 --> 00:08:57,040 Speaker 9: he makes a comment. And there are three things to 155 00:08:57,080 --> 00:08:59,600 Speaker 9: look at this. I think first there is the fact 156 00:08:59,600 --> 00:09:02,160 Speaker 9: that you can't because to your point, I think it 157 00:09:02,280 --> 00:09:04,800 Speaker 9: meant was meant to encourage troops. But then we have 158 00:09:04,840 --> 00:09:07,920 Speaker 9: analysts saying that it perhaps may have been the opposite 159 00:09:07,920 --> 00:09:10,600 Speaker 9: and deflated them, because why are you commenting? And the 160 00:09:10,640 --> 00:09:13,120 Speaker 9: second is where and he did it in a forum 161 00:09:13,720 --> 00:09:16,840 Speaker 9: he and the message is also interesting because he praised PDD, 162 00:09:17,000 --> 00:09:19,760 Speaker 9: his rival which has grown, which has gone to be 163 00:09:19,800 --> 00:09:23,000 Speaker 9: a formidable competitor in recent years, and he said Ali 164 00:09:23,000 --> 00:09:24,280 Speaker 9: Baba needs to course correct. 165 00:09:24,320 --> 00:09:27,439 Speaker 6: So that's second. And the third is the timing because this. 166 00:09:27,480 --> 00:09:31,760 Speaker 9: Comes shortly after PDD again reported blockbuster results, so I 167 00:09:31,800 --> 00:09:35,840 Speaker 9: am not sure if it actually motivated folks, but it's 168 00:09:35,920 --> 00:09:38,400 Speaker 9: really interesting the fact that he commented I would think. 169 00:09:39,080 --> 00:09:41,559 Speaker 7: It is a surprise in and of itself that somebody 170 00:09:41,600 --> 00:09:44,480 Speaker 7: who hasn't been operationally involved since twenty twenty comments at 171 00:09:44,520 --> 00:09:47,400 Speaker 7: all and then calls out one of the biggest rivals 172 00:09:47,400 --> 00:09:50,600 Speaker 7: saying the following about pinned wod Woe. 173 00:09:50,960 --> 00:09:52,640 Speaker 5: But here's the story as I see it. 174 00:09:52,679 --> 00:09:54,679 Speaker 7: Bring up the chart and show the performance on the 175 00:09:54,720 --> 00:09:57,640 Speaker 7: ADRs at least of pinned wod Woe, the owner of 176 00:09:57,679 --> 00:10:02,040 Speaker 7: Timu versus Ali Barba, And the chart speaks for itself, right, Henry, 177 00:10:02,120 --> 00:10:05,760 Speaker 7: just explain to the audience, Henry the battleground between Ali 178 00:10:05,760 --> 00:10:08,400 Speaker 7: Baba and Timu owned by Pindroid well on the e 179 00:10:08,440 --> 00:10:09,600 Speaker 7: commerce side. 180 00:10:10,600 --> 00:10:13,280 Speaker 10: Yeah, definitely, Just as Isabelle said, this come and come 181 00:10:13,320 --> 00:10:16,560 Speaker 10: from a very interesting point of time. On one hand, you 182 00:10:16,600 --> 00:10:19,200 Speaker 10: have the incumbent Ali Baba, which is struggling to gain 183 00:10:19,280 --> 00:10:23,360 Speaker 10: ground in domestic market. It has its strategy change, it 184 00:10:23,400 --> 00:10:26,360 Speaker 10: recently canceled the plan to spin off and list its 185 00:10:26,400 --> 00:10:29,840 Speaker 10: cloud unit, but at the same time it's going through management. 186 00:10:29,400 --> 00:10:30,520 Speaker 5: Reshuffle as well. 187 00:10:30,800 --> 00:10:34,240 Speaker 10: And at the other side you have the challenger TEAMU 188 00:10:34,720 --> 00:10:38,000 Speaker 10: and its owner pindor Door. So at the domestic market, 189 00:10:38,000 --> 00:10:41,400 Speaker 10: pin doo Doo is gaining share rapidly aggressively by cost 190 00:10:41,400 --> 00:10:45,880 Speaker 10: cutting and price cutting as well. And at the overseas playground, 191 00:10:46,000 --> 00:10:48,280 Speaker 10: Pindo Door is winning share by its Team U super 192 00:10:48,320 --> 00:10:53,079 Speaker 10: app and it's planning uh to roll out another ads 193 00:10:53,160 --> 00:10:56,240 Speaker 10: during this Super Bowl mid time show as well. So 194 00:10:56,280 --> 00:10:59,320 Speaker 10: which shows that the Pindodo is really gaining ground in 195 00:10:59,360 --> 00:11:01,360 Speaker 10: the US mark in the UK and the other side 196 00:11:01,400 --> 00:11:03,760 Speaker 10: of the market as well. So you see that from 197 00:11:03,760 --> 00:11:06,720 Speaker 10: the two spectrum. You see on one hand Ali Baba 198 00:11:06,880 --> 00:11:09,280 Speaker 10: is waning, but on the other hand, Pindo or the 199 00:11:09,320 --> 00:11:11,880 Speaker 10: PDD is definitely gaining ground rapidly. 200 00:11:12,000 --> 00:11:14,360 Speaker 4: Henry, I like that you dig into the restructuring and 201 00:11:14,640 --> 00:11:18,720 Speaker 4: on again, off again sort of versions of it. BlueBag 202 00:11:18,800 --> 00:11:21,320 Speaker 4: Intelligence put out a piece saying, actually, this cool out 203 00:11:21,360 --> 00:11:24,559 Speaker 4: by Jack Mars seems to reaffirm that indeed the restructuring 204 00:11:24,600 --> 00:11:25,880 Speaker 4: is still going to be upon us. 205 00:11:26,080 --> 00:11:27,840 Speaker 6: What does it end up looking like, Henry? 206 00:11:29,280 --> 00:11:34,160 Speaker 10: So remember Jack mauseeeded his control as CEO of Alibaba 207 00:11:34,200 --> 00:11:38,719 Speaker 10: in twenty fourteen, and he barely entered the public appearance 208 00:11:39,000 --> 00:11:41,440 Speaker 10: in the last two years due to the tech crackdown, 209 00:11:41,640 --> 00:11:45,120 Speaker 10: and now he's re entering the public sphere. He's now 210 00:11:45,160 --> 00:11:49,680 Speaker 10: commenting in the company's internal messaging board. There are lots 211 00:11:49,679 --> 00:11:52,719 Speaker 10: of analysis about this, and mostly it's about it has 212 00:11:52,760 --> 00:11:57,280 Speaker 10: been some time in this company's history that this company 213 00:11:57,559 --> 00:12:02,120 Speaker 10: is run by some companies, some executives that doesn't have 214 00:12:02,240 --> 00:12:04,720 Speaker 10: a close link with Jack Mal himself. 215 00:12:04,880 --> 00:12:05,800 Speaker 5: But now Jack Mal. 216 00:12:05,800 --> 00:12:08,679 Speaker 10: Re entering this public sphere might mean that Jack Mal 217 00:12:08,880 --> 00:12:12,680 Speaker 10: might have more control of the company's strategy, more company's 218 00:12:12,800 --> 00:12:13,840 Speaker 10: management as well. 219 00:12:14,000 --> 00:12:15,440 Speaker 6: Just something that we will wait and see. 220 00:12:16,440 --> 00:12:19,199 Speaker 7: There was a time where Ali Baba was going to 221 00:12:19,280 --> 00:12:22,800 Speaker 7: be China's trillion dollar market cap company. It was going 222 00:12:22,880 --> 00:12:27,240 Speaker 7: to be China's equivalent of the Silicon Valley darlings, Apple, 223 00:12:27,320 --> 00:12:30,559 Speaker 7: et cetera. And a lot has happened this year. You know, 224 00:12:30,640 --> 00:12:33,959 Speaker 7: there has been leadership shuffles. Isabelle I think it's worth 225 00:12:34,000 --> 00:12:38,320 Speaker 7: reminding everyone who actually runs Ali Barba as it stands. 226 00:12:38,679 --> 00:12:39,559 Speaker 6: It's exactly right. 227 00:12:39,600 --> 00:12:41,400 Speaker 9: It's been a tough year for Ali Baba, a tough 228 00:12:41,400 --> 00:12:44,000 Speaker 9: few years because Ali Baba's market cap is now around 229 00:12:44,000 --> 00:12:46,959 Speaker 9: one ninety billion, and PDD has leap frog and it's 230 00:12:47,000 --> 00:12:49,760 Speaker 9: now around one seventy billion, so that's not really a 231 00:12:49,800 --> 00:12:51,719 Speaker 9: far cry anymore. And of course you still have ten 232 00:12:51,800 --> 00:12:54,440 Speaker 9: cent leading. But the point is Ali Baba was going 233 00:12:54,440 --> 00:12:56,600 Speaker 9: at a fast pace and now it's slowed, and I think, 234 00:12:56,800 --> 00:12:59,120 Speaker 9: I don't want to put words into Jackma's mouth, of course, 235 00:12:59,160 --> 00:13:02,600 Speaker 9: but shows that he's kind of really concerned about the 236 00:13:02,600 --> 00:13:04,880 Speaker 9: direction of where Ali Baba is going, because it's one 237 00:13:04,920 --> 00:13:07,839 Speaker 9: thing to slow, but another thing for all your arrivals 238 00:13:07,880 --> 00:13:08,680 Speaker 9: to surpass you. 239 00:13:08,920 --> 00:13:10,800 Speaker 6: So I think that's really key right now. 240 00:13:10,800 --> 00:13:13,320 Speaker 9: And you know, Ma even this month hit the brakes 241 00:13:13,320 --> 00:13:15,680 Speaker 9: on his plan to reduce his stick on Alibaba because 242 00:13:15,679 --> 00:13:18,520 Speaker 9: the South price was not at a level that he's 243 00:13:18,559 --> 00:13:20,600 Speaker 9: happy with. For now, Ali Baba is just a fraction 244 00:13:20,679 --> 00:13:22,640 Speaker 9: of what it was in twenty twenty and is trading 245 00:13:22,679 --> 00:13:23,920 Speaker 9: at the lowest level this year. 246 00:13:24,040 --> 00:13:27,880 Speaker 7: Ed Yeah, and it's in negi ary year today, while 247 00:13:27,920 --> 00:13:32,240 Speaker 7: Pindodo's up triple digits year today. Bloomberg's Henry Wren and 248 00:13:32,360 --> 00:13:36,480 Speaker 7: Isabella Lee great team coverage on an important China story. Meanwhile, 249 00:13:36,480 --> 00:13:39,240 Speaker 7: sticking with China, China's five Whye capital and early backer 250 00:13:39,400 --> 00:13:41,959 Speaker 7: go Me is on track to surpass its target of 251 00:13:42,040 --> 00:13:45,439 Speaker 7: raising seven hundred million dollars for a closely watched venture fund. 252 00:13:45,440 --> 00:13:47,160 Speaker 5: It's a sign that investors. 253 00:13:46,880 --> 00:13:50,560 Speaker 7: Are regaining confidence in the world's biggest Internet arena. The 254 00:13:50,600 --> 00:13:53,240 Speaker 7: over subscribed US dollar fund has a hard cap of 255 00:13:53,280 --> 00:13:56,600 Speaker 7: eight hundred million dollars and is sector close early next year. 256 00:13:56,760 --> 00:13:59,080 Speaker 7: That's according to Bloomberg's sources CARC. 257 00:13:59,559 --> 00:14:02,240 Speaker 4: Now let's just move our attention towards the world of 258 00:14:02,280 --> 00:14:04,959 Speaker 4: crypto for a moment. And because Finance is appointed a 259 00:14:05,000 --> 00:14:07,520 Speaker 4: new CEO after it's four point three billion dollars settlement 260 00:14:07,559 --> 00:14:09,520 Speaker 4: with the US Department of Justice that force the co 261 00:14:09,600 --> 00:14:12,599 Speaker 4: founder CZ to step down. Now bloemgs Funsten like I 262 00:14:12,720 --> 00:14:15,600 Speaker 4: sat down with Richard Tang earlier to discuss his vision 263 00:14:15,640 --> 00:14:16,120 Speaker 4: for the company. 264 00:14:16,160 --> 00:14:16,840 Speaker 6: Is the new CEO. 265 00:14:17,800 --> 00:14:21,800 Speaker 11: The US resolution with the US agencies are very important, 266 00:14:21,880 --> 00:14:27,200 Speaker 11: right there are historical issues on compliance, registration and sanctions, 267 00:14:27,560 --> 00:14:30,680 Speaker 11: and with the resolution, we move on to a new chapter, 268 00:14:31,240 --> 00:14:34,320 Speaker 11: moving past a very challenging period of our corporate history. 269 00:14:35,080 --> 00:14:38,640 Speaker 11: So going forward, we will continue to focus on things 270 00:14:38,680 --> 00:14:41,280 Speaker 11: like user growth. On that front, I need to stress 271 00:14:41,360 --> 00:14:44,520 Speaker 11: the user SX are back one to one. Users can 272 00:14:44,560 --> 00:14:46,760 Speaker 11: withdraw one hundred percent of their SS at any point in time. 273 00:14:47,120 --> 00:14:49,680 Speaker 11: We continue to force focus on user need. At the 274 00:14:49,720 --> 00:14:53,760 Speaker 11: same time, we did make some mistakes along the way. 275 00:14:54,080 --> 00:14:57,840 Speaker 11: We acknowledge those. It's important for us as a financial 276 00:14:57,840 --> 00:15:00,360 Speaker 11: institution to do so, and we learn from the and 277 00:15:00,400 --> 00:15:03,600 Speaker 11: we continue to build in the journey right on things 278 00:15:03,680 --> 00:15:05,800 Speaker 11: like I think you're going to ask who as our 279 00:15:05,800 --> 00:15:09,440 Speaker 11: working quarters. We'll make those disclosures and do class right 280 00:15:09,960 --> 00:15:12,040 Speaker 11: as part of the resolution. There are certain things that 281 00:15:12,080 --> 00:15:14,240 Speaker 11: we were put in place that we are complete to 282 00:15:14,240 --> 00:15:17,640 Speaker 11: do so, including board of directors. But those announcements will 283 00:15:17,680 --> 00:15:19,400 Speaker 11: be coming soon, so watch that space. 284 00:15:20,440 --> 00:15:22,080 Speaker 12: Yeah, but Richard, can you already just give us a 285 00:15:22,120 --> 00:15:24,120 Speaker 12: sense of what people want? So if they want a 286 00:15:24,200 --> 00:15:27,440 Speaker 12: more normal structure with headquarters that was problematic in the 287 00:15:27,440 --> 00:15:30,720 Speaker 12: past because there was no one single place, how fast 288 00:15:30,920 --> 00:15:32,000 Speaker 12: do you think that will be done? 289 00:15:32,000 --> 00:15:32,840 Speaker 6: And then I'll also ask you. 290 00:15:32,800 --> 00:15:35,080 Speaker 12: About the board of directors because I guess that's what 291 00:15:35,120 --> 00:15:38,080 Speaker 12: people are asking for. It's like, what kind of framework 292 00:15:38,120 --> 00:15:39,040 Speaker 12: will Binance have. 293 00:15:41,200 --> 00:15:44,480 Speaker 11: We com back to the past where the industry is 294 00:15:44,520 --> 00:15:47,520 Speaker 11: ran naiscent. If you look at today, the direction of 295 00:15:47,560 --> 00:15:50,000 Speaker 11: travel is very clear. There's going to be much more 296 00:15:50,040 --> 00:15:52,840 Speaker 11: regulations for the crypto industry, even though only wanted of 297 00:15:52,880 --> 00:15:56,000 Speaker 11: global regulators are regulating this space. But the direction of 298 00:15:56,040 --> 00:15:57,080 Speaker 11: travel is very very clear. 299 00:15:57,200 --> 00:15:57,440 Speaker 5: Right. 300 00:15:57,800 --> 00:16:01,040 Speaker 11: So along with that, along with the maturing of both 301 00:16:01,120 --> 00:16:04,160 Speaker 11: industry as well as to copy it ourselves. All these 302 00:16:04,160 --> 00:16:06,440 Speaker 11: things will be put in place. As I mentioned again, 303 00:16:07,160 --> 00:16:10,600 Speaker 11: a bot of directors will be instituted. It's on very 304 00:16:10,680 --> 00:16:15,840 Speaker 11: robuth timeline. Same for things like the questions did you asked? 305 00:16:16,000 --> 00:16:18,040 Speaker 11: And we will make those annoscement coasts so you can 306 00:16:18,120 --> 00:16:19,120 Speaker 11: disclose it at this point in. 307 00:16:19,160 --> 00:16:32,680 Speaker 4: That it's today's big Take, and we're taking a look 308 00:16:32,720 --> 00:16:35,840 Speaker 4: at an issue that's been rising along with AI generated 309 00:16:35,880 --> 00:16:39,160 Speaker 4: content coming closer and closer to real images. We bring 310 00:16:39,200 --> 00:16:41,800 Speaker 4: you exclusive reporting from Bluebog Business Week focusing on a 311 00:16:41,840 --> 00:16:45,200 Speaker 4: group of deep fake pornography victims and how they actually 312 00:16:45,200 --> 00:16:48,520 Speaker 4: banded together they fought back despite the absence of federal 313 00:16:48,600 --> 00:16:51,960 Speaker 4: laws to protect them. Bloomberg's Olivia Carvill joins us now 314 00:16:52,040 --> 00:16:54,760 Speaker 4: one of the key reporters on this, and it all 315 00:16:54,800 --> 00:16:58,000 Speaker 4: goes back to New Year's Eve twenty twenty, when a 316 00:16:58,040 --> 00:17:00,240 Speaker 4: text came through to one of these particular women in 317 00:17:00,280 --> 00:17:04,439 Speaker 4: Long Island who've managed to now well find feel there 318 00:17:04,440 --> 00:17:06,959 Speaker 4: were perhaps victims and fought back and the ending up 319 00:17:07,160 --> 00:17:08,040 Speaker 4: sort of winning out here. 320 00:17:08,320 --> 00:17:09,160 Speaker 6: Yeah, that's right. 321 00:17:09,200 --> 00:17:12,520 Speaker 13: I mean, this is a story of female empowerment in 322 00:17:12,560 --> 00:17:15,320 Speaker 13: this new era of generative AI that we all live in. 323 00:17:15,760 --> 00:17:19,800 Speaker 13: This technology is both terrifying but also exciting, and I 324 00:17:19,840 --> 00:17:22,600 Speaker 13: think we wanted with this story to highlight some of 325 00:17:22,600 --> 00:17:25,320 Speaker 13: those potential harms and that's what led us to leave 326 00:17:25,320 --> 00:17:25,760 Speaker 13: it Town. 327 00:17:25,800 --> 00:17:27,959 Speaker 5: Long Island, Olivia. 328 00:17:28,040 --> 00:17:30,399 Speaker 7: In allgad Big Takes, there is a case study or 329 00:17:30,440 --> 00:17:34,240 Speaker 7: case studies and a narrative around the broader story. But 330 00:17:34,320 --> 00:17:39,040 Speaker 7: what it highlights is a lack of legal protection, a 331 00:17:39,200 --> 00:17:40,240 Speaker 7: deficit in the law. 332 00:17:40,400 --> 00:17:41,800 Speaker 5: Just explain that side to us. 333 00:17:42,280 --> 00:17:44,439 Speaker 13: When you look across the country, there is just a 334 00:17:44,520 --> 00:17:48,280 Speaker 13: patchwork of laws focusing on deep fakes at the moment. 335 00:17:48,720 --> 00:17:51,119 Speaker 13: The story is really symbolic of the fact that there 336 00:17:51,200 --> 00:17:54,720 Speaker 13: are no very strong laws to target deep fake content 337 00:17:54,920 --> 00:17:57,440 Speaker 13: right now in the US, there is no federal law 338 00:17:57,840 --> 00:18:01,760 Speaker 13: against creating fake pornographic con tent online and with this 339 00:18:01,880 --> 00:18:04,720 Speaker 13: rise of generative AI, that puts us in a very 340 00:18:04,760 --> 00:18:07,560 Speaker 13: scary place. So what we did for this story is 341 00:18:07,600 --> 00:18:10,200 Speaker 13: we analyzed some of the statutes that have been put 342 00:18:10,240 --> 00:18:13,480 Speaker 13: in place across the country and found this patchwork of 343 00:18:13,760 --> 00:18:17,240 Speaker 13: civil cases. Some of the statutes are criminal, some only 344 00:18:17,280 --> 00:18:20,879 Speaker 13: target election related content, and some are just amendments to 345 00:18:20,920 --> 00:18:23,760 Speaker 13: revenge porn laws. What this means is that there is 346 00:18:24,000 --> 00:18:28,600 Speaker 13: very little recourse for victims of deep fake pornography today. 347 00:18:30,040 --> 00:18:33,600 Speaker 4: It's an extremely graphic Internet address which was where they 348 00:18:33,640 --> 00:18:36,720 Speaker 4: found the content that was faked for seeing me of 349 00:18:36,760 --> 00:18:41,280 Speaker 4: themselves young girls in school, and I'm interested as also. 350 00:18:41,320 --> 00:18:43,919 Speaker 4: You also go to New Zealand for the story and 351 00:18:44,000 --> 00:18:47,439 Speaker 4: a legal entanglement that's happening over there. Is this an 352 00:18:47,480 --> 00:18:50,120 Speaker 4: issue in the US alone or is this a global 353 00:18:50,119 --> 00:18:53,040 Speaker 4: issue of regulation trying to keep up with now generative 354 00:18:53,040 --> 00:18:57,640 Speaker 4: AI pushing out what are incredibly realistic photos that aren't photos. 355 00:18:58,040 --> 00:19:01,479 Speaker 13: This is definitely a global issue. We're seeing cases across 356 00:19:01,520 --> 00:19:04,560 Speaker 13: the country. As we were studying this particular website, we 357 00:19:04,640 --> 00:19:08,800 Speaker 13: saw examples of deep fake pornography of women from countries 358 00:19:08,840 --> 00:19:09,760 Speaker 13: all over the world. 359 00:19:09,920 --> 00:19:11,760 Speaker 6: This isn't just a US problem. 360 00:19:12,000 --> 00:19:14,919 Speaker 13: But this case in Levittown is the first real example 361 00:19:15,080 --> 00:19:18,720 Speaker 13: of a deep fake related conviction where we could highlight 362 00:19:18,800 --> 00:19:22,320 Speaker 13: in the story how prosecutors and the police really tried 363 00:19:22,359 --> 00:19:25,399 Speaker 13: to file charges against the young man who was behind 364 00:19:25,400 --> 00:19:29,240 Speaker 13: this content, but ultimately failed to do so because there 365 00:19:29,240 --> 00:19:33,320 Speaker 13: are no laws to protect victims of deep fake pornography here. 366 00:19:33,720 --> 00:19:36,679 Speaker 13: So I feel as though this story this narrative, and 367 00:19:36,720 --> 00:19:39,480 Speaker 13: you're right, it crosses from Levittown all the way to 368 00:19:39,560 --> 00:19:42,640 Speaker 13: New Zealand is symbolic of a much broader problem. 369 00:19:43,480 --> 00:19:47,119 Speaker 7: Bloomberg's Olivia carvill with the big take, terrific reporting, Thank you. 370 00:19:47,359 --> 00:19:50,240 Speaker 7: Another big story coming out of Apple reportedly taking steps 371 00:19:50,280 --> 00:19:52,560 Speaker 7: to pull the plug on a credit card partnership with 372 00:19:52,560 --> 00:20:07,600 Speaker 7: Goldman the details. Next, this is Bloomberg Technology. Welcome back 373 00:20:07,640 --> 00:20:10,119 Speaker 7: to Bloomberg Technology, Ed love O here in San Francisco. 374 00:20:10,280 --> 00:20:12,120 Speaker 4: I'm Caroline hired in New York. Let's get a check 375 00:20:12,119 --> 00:20:13,959 Speaker 4: in on these markets. But I'm looking at what's happening 376 00:20:14,119 --> 00:20:16,000 Speaker 4: in the world of Golden Dragon and China Index. 377 00:20:16,000 --> 00:20:16,960 Speaker 6: Then now's that Golden Dragon. 378 00:20:17,000 --> 00:20:19,159 Speaker 4: This is what, of course is the Chinese names traded 379 00:20:19,200 --> 00:20:22,000 Speaker 4: here over the United States ADRs and actually under pressure 380 00:20:22,000 --> 00:20:25,560 Speaker 4: after we saw mayit one's numbers showing a lack of resiliency. 381 00:20:25,640 --> 00:20:27,880 Speaker 4: Was so worried about a Chinese consumer and Andy Dali 382 00:20:27,920 --> 00:20:30,160 Speaker 4: Barber Jack mar coming back to speak out and say 383 00:20:30,200 --> 00:20:32,720 Speaker 4: you need to take on PDD, which actually did incredibly 384 00:20:32,720 --> 00:20:34,560 Speaker 4: well in its numbers. We're looking at what's happening in 385 00:20:34,720 --> 00:20:37,120 Speaker 4: HPE as well. It came out with its numbers yesterday 386 00:20:37,119 --> 00:20:40,199 Speaker 4: after the bell We're seeing a rebound up seven percent. 387 00:20:40,280 --> 00:20:42,600 Speaker 6: Why, well, it's not at server business, that's the sure. 388 00:20:42,640 --> 00:20:46,040 Speaker 4: It's all about its resiliency in artificial intelligence that manages 389 00:20:46,080 --> 00:20:48,359 Speaker 4: to buoy this stock. And I'm interested in the AI 390 00:20:48,600 --> 00:20:50,680 Speaker 4: read across when it comes to Amazon as well. Ed 391 00:20:50,680 --> 00:20:52,400 Speaker 4: we're looking at just off by about four tens percent 392 00:20:52,480 --> 00:20:54,280 Speaker 4: on Amazon, but they had been doing well earlier on 393 00:20:54,320 --> 00:20:57,199 Speaker 4: the day as we saw reinvent. Of course, that annual 394 00:20:57,240 --> 00:20:59,919 Speaker 4: gathering of its customers really managing to paint a position 395 00:21:00,119 --> 00:21:04,080 Speaker 4: of well combative and competitive nature that Amazon's coming at 396 00:21:04,119 --> 00:21:05,840 Speaker 4: this when it comes with its chips, of course, that 397 00:21:05,840 --> 00:21:07,760 Speaker 4: it is making and managing to make general to AI 398 00:21:08,000 --> 00:21:09,600 Speaker 4: part of the corporate lexicon. 399 00:21:09,680 --> 00:21:10,440 Speaker 6: Two. 400 00:21:11,040 --> 00:21:15,080 Speaker 7: I think combative is correct. Competitive is what they'd say. 401 00:21:15,119 --> 00:21:18,000 Speaker 7: Amazon Web Services did kick off its giant annual conference 402 00:21:18,240 --> 00:21:21,879 Speaker 7: in Las Vegas yesterday, the new announcement updated versions of 403 00:21:21,880 --> 00:21:25,240 Speaker 7: its in house Silicon and expansion of a partnership with Nvidia. 404 00:21:25,560 --> 00:21:30,040 Speaker 7: I caught up with AWS CEO Adam Selipski, have a listen, well, I. 405 00:21:29,960 --> 00:21:32,359 Speaker 2: Think our strategy has been very consistent. It is to 406 00:21:32,440 --> 00:21:37,200 Speaker 2: provide choice and powerful options at all layers of the stack. 407 00:21:37,680 --> 00:21:40,760 Speaker 2: So down at the infrastructure layer of what you need 408 00:21:40,800 --> 00:21:44,920 Speaker 2: to do generative AI really well. As you mentioned, we 409 00:21:45,359 --> 00:21:48,560 Speaker 2: both have been investing in our own silicon and then 410 00:21:48,640 --> 00:21:52,440 Speaker 2: we have had a long standing, wonderful relationship with Nvidia. 411 00:21:52,760 --> 00:21:56,520 Speaker 2: We've been the first to bring pretty much every significant 412 00:21:56,880 --> 00:22:00,200 Speaker 2: in Nvidia chip to the cloud, including their latest H 413 00:22:00,240 --> 00:22:02,880 Speaker 2: one hundred this past summer, and I was really excited 414 00:22:02,880 --> 00:22:05,720 Speaker 2: to have their CEO, Jensen Holong on stage with me 415 00:22:05,800 --> 00:22:09,520 Speaker 2: this morning talking about an expansion of the partnership with 416 00:22:10,080 --> 00:22:15,560 Speaker 2: AWS bringing their DJX cloud to AWS, and Nvidia itself 417 00:22:15,680 --> 00:22:19,080 Speaker 2: is going to be standing up a huge supercomputer of 418 00:22:19,200 --> 00:22:22,840 Speaker 2: a cloud for their own internal R and D on AWS. 419 00:22:22,840 --> 00:22:26,280 Speaker 2: So it's a fantastic expansion of what's really a great 420 00:22:26,320 --> 00:22:29,480 Speaker 2: relationship that benefits our mutual customers, Adam. 421 00:22:29,520 --> 00:22:32,960 Speaker 7: And they still supply constraints around in video GPUs. 422 00:22:34,000 --> 00:22:36,520 Speaker 2: Well, they're very popular, and I think it is still 423 00:22:36,560 --> 00:22:40,240 Speaker 2: remains true that there's probably more people who want to 424 00:22:40,240 --> 00:22:42,920 Speaker 2: get their hands on them than actually can, which is 425 00:22:42,960 --> 00:22:46,440 Speaker 2: one of the reasons why we also announced this concept 426 00:22:46,600 --> 00:22:52,240 Speaker 2: of clusters BC two for chips and so that you 427 00:22:52,280 --> 00:22:55,600 Speaker 2: can actually go down reserve up to hundreds of GPUs 428 00:22:55,840 --> 00:22:58,280 Speaker 2: for your short term generative AI needs for things like 429 00:22:58,359 --> 00:23:01,200 Speaker 2: training models, which can tend to apisotic, and there's really 430 00:23:01,240 --> 00:23:04,360 Speaker 2: nobody else out there offering anything like that kind of service. 431 00:23:05,119 --> 00:23:08,200 Speaker 7: Given that's the case, if you had to shift any 432 00:23:08,240 --> 00:23:11,800 Speaker 7: customers to Trainium because of the limited supply of in 433 00:23:11,920 --> 00:23:14,080 Speaker 7: video GPUs, Yeah. 434 00:23:13,920 --> 00:23:18,200 Speaker 2: It's really not about shifting. It's really about customers need 435 00:23:18,200 --> 00:23:21,680 Speaker 2: different Different customers need different things. The same customer needs 436 00:23:21,720 --> 00:23:25,240 Speaker 2: different things for different use cases and awos for this 437 00:23:25,480 --> 00:23:28,000 Speaker 2: over seventeen years we've been doing this has been all 438 00:23:28,000 --> 00:23:31,480 Speaker 2: about choice, all about democratization, all about putting tools in 439 00:23:31,480 --> 00:23:33,320 Speaker 2: the hands of our customers so that they can make 440 00:23:33,359 --> 00:23:36,240 Speaker 2: the choices about what we need. And so we're also 441 00:23:36,600 --> 00:23:40,680 Speaker 2: excited that we announced the second generation of our training 442 00:23:40,720 --> 00:23:44,119 Speaker 2: specific chip for training gener VII workloads, and that is 443 00:23:44,560 --> 00:23:47,920 Speaker 2: Trainium too, and that's going to have up to four 444 00:23:48,040 --> 00:23:51,040 Speaker 2: times the compute performance of the first generation of Trainium. 445 00:23:51,240 --> 00:23:53,159 Speaker 2: We of course, have been investing in our own custom 446 00:23:53,240 --> 00:23:56,720 Speaker 2: silicon for years. We also today announce that we're shipping 447 00:23:56,880 --> 00:24:00,880 Speaker 2: the preview of our fourth generation of general purpose chip, 448 00:24:00,920 --> 00:24:03,560 Speaker 2: Graviton four. I happen to have one with me right here. 449 00:24:03,640 --> 00:24:06,680 Speaker 2: This is a Graviton forward ship. We're not talking about 450 00:24:06,680 --> 00:24:09,439 Speaker 2: it we're not showing slides on it. It's not future 451 00:24:09,440 --> 00:24:11,760 Speaker 2: looking like a lot of other cloud providers. Yeah, it 452 00:24:11,840 --> 00:24:16,000 Speaker 2: is shipping today and again our fourth generation, the power 453 00:24:16,160 --> 00:24:19,960 Speaker 2: is incredible, the price performance is going to be incredibly attractive, 454 00:24:20,400 --> 00:24:24,480 Speaker 2: and our chips also have incredible energy efficiency benefits, which 455 00:24:24,560 --> 00:24:27,440 Speaker 2: is really really important to our customers these days. 456 00:24:28,920 --> 00:24:31,399 Speaker 7: A bit of shade being thrown their carro We also 457 00:24:31,600 --> 00:24:34,400 Speaker 7: finally got a chatbot from Amazon. 458 00:24:34,600 --> 00:24:37,800 Speaker 5: It's called Q. Any idea why it's called Q? 459 00:24:38,960 --> 00:24:40,520 Speaker 6: Please tell me it's something to do with the British 460 00:24:40,560 --> 00:24:41,240 Speaker 6: Secret Service. 461 00:24:42,240 --> 00:24:44,199 Speaker 5: It is not. I did post that on X it 462 00:24:44,240 --> 00:24:47,800 Speaker 5: is not. Q stands for question. Oh that's it. That 463 00:24:47,960 --> 00:24:53,200 Speaker 5: was the rationale from the Star Trek's inside Amazon. That's it. 464 00:24:53,760 --> 00:24:56,440 Speaker 6: Oh, well, gotta love it. Chatbots taking over the world. 465 00:24:56,440 --> 00:25:00,159 Speaker 4: Meanwhile, well, let's talk about whether or not Apple's focus 466 00:25:00,200 --> 00:25:02,359 Speaker 4: on fintech has been taking over the world or not, 467 00:25:02,440 --> 00:25:05,640 Speaker 4: because it's actually taking steps towards running down as credit 468 00:25:05,720 --> 00:25:08,360 Speaker 4: card deal with Goldman Sachs. So's to say, Apple recently 469 00:25:08,400 --> 00:25:13,399 Speaker 4: sent a term sheet to well, perhaps a different institution 470 00:25:14,000 --> 00:25:17,640 Speaker 4: which has been trying to ultimately see a pullback from 471 00:25:17,640 --> 00:25:19,760 Speaker 4: a credit card business for Goldman Sacks. At the same time, 472 00:25:19,920 --> 00:25:22,160 Speaker 4: let's get more contact on Blue Magnus Wall Street reporter 473 00:25:22,200 --> 00:25:22,919 Speaker 4: Shanani Bassack. 474 00:25:23,080 --> 00:25:24,439 Speaker 6: We mosto got Blue Magnuze chief. 475 00:25:24,280 --> 00:25:27,560 Speaker 4: Correspondent Mark German, And Mark, let's start with you on 476 00:25:27,840 --> 00:25:32,320 Speaker 4: the Apple Goldman relationship, because well, it hasn't been as 477 00:25:32,720 --> 00:25:34,560 Speaker 4: positive as both would have liked. 478 00:25:34,720 --> 00:25:38,159 Speaker 14: Feels like, Yeah, the Apple and Goldman Sax relationship has 479 00:25:38,200 --> 00:25:42,160 Speaker 14: been rocky from the beginning the Apple cards development, everything 480 00:25:42,160 --> 00:25:43,640 Speaker 14: that had to be done on both the Apple side 481 00:25:43,680 --> 00:25:46,720 Speaker 14: and the Goldman side. Really it was a rocky development process. 482 00:25:46,800 --> 00:25:49,879 Speaker 14: It was two companies getting into a new game together 483 00:25:50,119 --> 00:25:52,159 Speaker 14: right for the first time. A lot of back end 484 00:25:52,280 --> 00:25:55,560 Speaker 14: changes had to be created both at Apple and Golden Sacks. 485 00:25:55,800 --> 00:25:59,399 Speaker 14: You had two companies run by people with big personalities, 486 00:25:59,600 --> 00:26:03,040 Speaker 14: with ends with different backgrounds coming together to build. 487 00:26:02,880 --> 00:26:03,400 Speaker 1: Something, right. 488 00:26:03,440 --> 00:26:05,680 Speaker 14: That's what a partnership is. But when you have two 489 00:26:05,800 --> 00:26:09,840 Speaker 14: really intense companies, two intense groups of people, opinionated groups 490 00:26:09,840 --> 00:26:12,560 Speaker 14: of people who believe they're doing it best, sometimes that 491 00:26:12,560 --> 00:26:13,440 Speaker 14: could come to a head. 492 00:26:13,720 --> 00:26:14,680 Speaker 6: Right, And what you've. 493 00:26:14,520 --> 00:26:18,000 Speaker 14: Seen is you've seen pretty good consumer reception to the 494 00:26:18,000 --> 00:26:20,199 Speaker 14: Apple Card and the other fintech products from Apple over 495 00:26:20,240 --> 00:26:22,920 Speaker 14: the past few years. But what you've also seen are 496 00:26:22,960 --> 00:26:25,679 Speaker 14: some struggles Goldman in particular. This has been a multi 497 00:26:25,760 --> 00:26:29,480 Speaker 14: hundred million dollar, if not multi billion dollar loss and 498 00:26:29,560 --> 00:26:32,600 Speaker 14: proposition for Goldman Sacks, and so their skin in the 499 00:26:32,640 --> 00:26:35,440 Speaker 14: game has been little more than a branding exercise. As 500 00:26:35,440 --> 00:26:37,560 Speaker 14: we've written several times, and I'm sure a Shanali can 501 00:26:37,600 --> 00:26:40,640 Speaker 14: talk about, Goldman has been pulling back from consumer businesses. 502 00:26:40,680 --> 00:26:43,520 Speaker 14: They've pulled back on other credit cards and such, and 503 00:26:43,880 --> 00:26:47,040 Speaker 14: Apple needs to sort of save face here. They need 504 00:26:47,080 --> 00:26:49,600 Speaker 14: to have a strong partner in the credit card game. 505 00:26:49,960 --> 00:26:53,200 Speaker 14: And being with a company that has been publicly one 506 00:26:53,240 --> 00:26:55,280 Speaker 14: foot out the door, maybe one and a half feet 507 00:26:55,320 --> 00:26:57,280 Speaker 14: out the door, maybe even two feet out the door, 508 00:26:57,640 --> 00:26:59,640 Speaker 14: you know, that really doesn't serve Apple well long term. 509 00:26:59,680 --> 00:27:01,879 Speaker 14: So with done is they sent a proposal to Goldman 510 00:27:01,960 --> 00:27:04,600 Speaker 14: Sacks to get out of this partnership. This is being 511 00:27:04,600 --> 00:27:06,600 Speaker 14: able to get out in about two three years from 512 00:27:06,600 --> 00:27:08,840 Speaker 14: now versus when the deal's supposed to end in twenty 513 00:27:08,880 --> 00:27:10,879 Speaker 14: twenty nine. So I don't know if that means Goldman 514 00:27:10,960 --> 00:27:13,960 Speaker 14: has to make some sort of public acknowledgement about exiting. 515 00:27:13,960 --> 00:27:15,960 Speaker 14: I don't know if Goldman has to pay a certain amount. 516 00:27:16,240 --> 00:27:18,240 Speaker 14: I don't know if Apple has to reduce its payments 517 00:27:18,280 --> 00:27:21,119 Speaker 14: to Goldman, but they've sent a proposal to Goldman to 518 00:27:21,200 --> 00:27:24,359 Speaker 14: let Goldman walk about five years early from this partnership, 519 00:27:24,400 --> 00:27:26,320 Speaker 14: while Apple can go ahead and look for someone else 520 00:27:26,320 --> 00:27:27,040 Speaker 14: to replace them. 521 00:27:27,760 --> 00:27:28,119 Speaker 5: Snarali. 522 00:27:28,200 --> 00:27:30,760 Speaker 7: We can get into Apple's position long term on a 523 00:27:30,800 --> 00:27:32,840 Speaker 7: car because it looks like the Apple side of the cart. 524 00:27:32,720 --> 00:27:33,680 Speaker 5: Ain't going anywhere. 525 00:27:34,119 --> 00:27:36,919 Speaker 7: But there's been an emission from Goldman that they just 526 00:27:37,040 --> 00:27:41,159 Speaker 7: moved too quickly, too early, They made mistakes with the product. 527 00:27:41,600 --> 00:27:43,960 Speaker 7: Some of the data around the deposits is really good. 528 00:27:45,080 --> 00:27:47,640 Speaker 7: Where are they coming at this from from Goldman Sachs side. 529 00:27:47,800 --> 00:27:49,880 Speaker 15: Yeah, you have to look at it across product lines, 530 00:27:49,880 --> 00:27:52,359 Speaker 15: because I think that's an important part here. On one hand, 531 00:27:52,720 --> 00:27:56,920 Speaker 15: Goldman likes to pull in deposits those market markets. Deposit 532 00:27:57,040 --> 00:27:59,640 Speaker 15: rates are still quite high and for a bank, that 533 00:28:00,119 --> 00:28:03,320 Speaker 15: extra consumer deposit base helps lower the cost of funding 534 00:28:03,320 --> 00:28:05,920 Speaker 15: for a bank. But the credit card business here, where 535 00:28:06,000 --> 00:28:09,680 Speaker 15: they had struck deals with GM major clients Apple, you 536 00:28:09,760 --> 00:28:11,960 Speaker 15: have them starting to step back from that business and 537 00:28:12,000 --> 00:28:14,639 Speaker 15: it is really kind of the last major piece of 538 00:28:14,680 --> 00:28:17,560 Speaker 15: the consumer strategy that they're trying to exit from. So 539 00:28:17,680 --> 00:28:19,720 Speaker 15: what have they already gotten out of they have looked 540 00:28:19,760 --> 00:28:23,359 Speaker 15: to sell Green Sky already United Capital. These are things 541 00:28:23,359 --> 00:28:25,879 Speaker 15: that have brought them deeper into the wealth business. They 542 00:28:25,920 --> 00:28:29,359 Speaker 15: had scrapped that idea of larger sets of accounts for 543 00:28:29,359 --> 00:28:32,159 Speaker 15: different clients as well. But the green Sky was the 544 00:28:32,160 --> 00:28:33,920 Speaker 15: home installment loan business, of course, So where does that 545 00:28:34,000 --> 00:28:35,600 Speaker 15: leave them. It leaves them with all these card deals 546 00:28:35,880 --> 00:28:38,480 Speaker 15: and Apple is you know this, by the way, for 547 00:28:38,560 --> 00:28:41,320 Speaker 15: Goldman could have been a problem that could have lasted 548 00:28:41,360 --> 00:28:43,440 Speaker 15: them years. And when it comes to the Apple card 549 00:28:43,440 --> 00:28:46,360 Speaker 15: in particular, one major problem ed it was the servicing 550 00:28:46,480 --> 00:28:49,560 Speaker 15: of these clients as well as the loss rates, because 551 00:28:49,600 --> 00:28:51,880 Speaker 15: the idea here that Apple wanted more of their clients 552 00:28:51,920 --> 00:28:53,880 Speaker 15: to be able to get credit through these cards, and 553 00:28:53,960 --> 00:28:56,080 Speaker 15: so they pushed for that to happen. And now you 554 00:28:56,160 --> 00:28:59,440 Speaker 15: had Goldman stuck with those loss rates, really bringing down 555 00:28:59,440 --> 00:29:01,960 Speaker 15: the profit of the business overall. Now, according to the 556 00:29:01,960 --> 00:29:04,160 Speaker 15: Wall Street Journal, some of the potential people that could 557 00:29:04,160 --> 00:29:09,040 Speaker 15: take on these this card business alongside Apple could include 558 00:29:09,040 --> 00:29:12,440 Speaker 15: American Express, could include Synchrony. But some of the issues 559 00:29:12,440 --> 00:29:15,560 Speaker 15: I've outlined for you over there at Goldman would still 560 00:29:15,560 --> 00:29:17,320 Speaker 15: hold true for them as well. 561 00:29:18,440 --> 00:29:21,200 Speaker 7: All right, Bloombos Mark German and Shanalie Bassett. We did 562 00:29:21,280 --> 00:29:24,160 Speaker 7: show Apple's comment on the story. There they seem committed 563 00:29:24,240 --> 00:29:28,040 Speaker 7: Caro to a card in the first instance and long term. 564 00:29:27,840 --> 00:29:30,160 Speaker 4: Well from fintech to where you'd be spending your money. 565 00:29:30,200 --> 00:29:32,480 Speaker 4: And perhaps it's not the movies to go and see. 566 00:29:32,480 --> 00:29:34,440 Speaker 4: Wish it would seem because Disney's newest. 567 00:29:34,200 --> 00:29:36,920 Speaker 6: Auni Maintor musical is being marked as a box office dud, 568 00:29:37,120 --> 00:29:38,280 Speaker 6: delivering just half. 569 00:29:38,040 --> 00:29:40,680 Speaker 4: Of its expected ticket sales over the Thanksgiving weekend. Now, 570 00:29:40,760 --> 00:29:43,520 Speaker 4: Disney Studio executives, they've got to assess or went wrong, 571 00:29:43,800 --> 00:29:45,840 Speaker 4: Like it's been a year where we've seen strong female 572 00:29:45,920 --> 00:29:48,160 Speaker 4: leads win big in the box office, Think Barbie, think 573 00:29:48,160 --> 00:29:51,720 Speaker 4: Taylor Swift. But wish it's flopping And maybe it's the 574 00:29:51,760 --> 00:29:54,240 Speaker 4: son of the times. Maybe these classic fairy tale princess 575 00:29:54,240 --> 00:29:56,720 Speaker 4: stories aren't as appealing as they were once or as 576 00:29:56,760 --> 00:29:58,680 Speaker 4: the mother of a daughter who's obsessed with princesses for 577 00:29:58,760 --> 00:30:00,520 Speaker 4: my sins, maybe it's bit scary. 578 00:30:00,640 --> 00:30:02,720 Speaker 6: I don't know, but for now it's a flop. 579 00:30:03,200 --> 00:30:05,520 Speaker 4: Coming up, we'll take the pulse of the European VC 580 00:30:05,640 --> 00:30:09,920 Speaker 4: and tech industry. OX co founder Michael Johnson's joining us 581 00:30:09,960 --> 00:30:11,440 Speaker 4: on a big raise in the second fund. 582 00:30:27,320 --> 00:30:31,160 Speaker 7: Stability AI has explored selling the company, with management facing 583 00:30:31,280 --> 00:30:34,920 Speaker 7: increased pressure from investors over its financial position. That all, 584 00:30:34,920 --> 00:30:38,360 Speaker 7: according to Bloomberg's sources, a deal is not imminent and 585 00:30:38,440 --> 00:30:41,360 Speaker 7: the company could of course cut the process short without selling. 586 00:30:41,440 --> 00:30:44,040 Speaker 7: Let's bring in Bloomberg's Rachel Metz, who broke this one. 587 00:30:44,360 --> 00:30:46,720 Speaker 7: We've been chasing what's going on inside Stability for a 588 00:30:46,720 --> 00:30:49,240 Speaker 7: little while. Looks like there's a for sale sign in 589 00:30:49,280 --> 00:30:51,960 Speaker 7: the digital window and IMAD is under pressure. 590 00:30:52,000 --> 00:30:52,600 Speaker 5: What have you learned? 591 00:30:52,960 --> 00:30:53,680 Speaker 6: Yeah, so we. 592 00:30:53,840 --> 00:30:57,720 Speaker 16: Have learned that one of the company's key investors, CO two, 593 00:30:58,080 --> 00:31:03,120 Speaker 16: sent a letter to the company in October asking pressure 594 00:31:03,240 --> 00:31:06,320 Speaker 16: pressure you had to step down, asking questions about the 595 00:31:06,400 --> 00:31:10,120 Speaker 16: company's financial status, how much certain people were being paid, 596 00:31:10,160 --> 00:31:14,080 Speaker 16: things like that. And there's also been this is putting 597 00:31:14,120 --> 00:31:16,840 Speaker 16: pressure on the company to see if it can find 598 00:31:16,880 --> 00:31:19,440 Speaker 16: a buyer for itself. It at this point doesn't have 599 00:31:19,520 --> 00:31:22,240 Speaker 16: a ton of cash, so it's been reaching out to 600 00:31:22,280 --> 00:31:26,360 Speaker 16: a few companies. We've learned it's reached out to cohere Jasper. 601 00:31:27,920 --> 00:31:30,480 Speaker 16: Those are two of the companies that we know for 602 00:31:30,520 --> 00:31:33,280 Speaker 16: sure that it's been reaching out to. But those companies, 603 00:31:33,320 --> 00:31:34,760 Speaker 16: as far as we know are not interested. 604 00:31:35,000 --> 00:31:38,719 Speaker 4: Meanwhile, spose people for the company's stability fight back and 605 00:31:38,760 --> 00:31:41,160 Speaker 4: say no, it's not not for sale, and actually investors 606 00:31:41,160 --> 00:31:42,520 Speaker 4: believe in leadership. 607 00:31:42,600 --> 00:31:43,080 Speaker 6: Do you buy that? 608 00:31:44,920 --> 00:31:47,840 Speaker 16: I mean, I think these things are always complicated and 609 00:31:48,240 --> 00:31:50,920 Speaker 16: it it it could be sort of both ways at once. Right, 610 00:31:50,920 --> 00:31:53,880 Speaker 16: they have plenty of investors, uh, but it is certainly 611 00:31:53,880 --> 00:31:56,920 Speaker 16: clear that some of its key investors are not happy 612 00:31:56,920 --> 00:31:58,800 Speaker 16: with the direction that the company has been going in. 613 00:31:58,880 --> 00:32:02,640 Speaker 4: For sure, Mets as always brilliant reporting. We thank you 614 00:32:02,680 --> 00:32:05,640 Speaker 4: for keeping us up to date with perhaps what's thought of. 615 00:32:05,720 --> 00:32:07,080 Speaker 6: Is AI hype. 616 00:32:07,320 --> 00:32:09,000 Speaker 4: We're going to move away from that for a moment 617 00:32:09,040 --> 00:32:11,800 Speaker 4: because one firm is going anti hype, but it's continuing 618 00:32:11,840 --> 00:32:14,640 Speaker 4: to double down investments in the SaaS space. Ox just 619 00:32:14,680 --> 00:32:16,800 Speaker 4: announce the close of their second fund with one hundred 620 00:32:16,880 --> 00:32:20,280 Speaker 4: ninety million dollars to grow European software startups. US co 621 00:32:20,440 --> 00:32:23,880 Speaker 4: founder and general partner Michael Johnson is joining us now. 622 00:32:24,240 --> 00:32:27,600 Speaker 4: And you have a focus on European software as a service, 623 00:32:27,960 --> 00:32:32,720 Speaker 4: but can that still be AI leveraged, generative AI applied. 624 00:32:33,000 --> 00:32:34,560 Speaker 6: If you're saying you're anti hype at this. 625 00:32:34,520 --> 00:32:39,160 Speaker 17: Moment, A good afternoon, Caroline, Yes, very much. So I mean, 626 00:32:39,240 --> 00:32:43,080 Speaker 17: we are not specifically looking to make AI investments as 627 00:32:43,120 --> 00:32:45,560 Speaker 17: a sector bed per se, but we do think that 628 00:32:46,160 --> 00:32:50,000 Speaker 17: AI is providing a foundational new wave of innovation that 629 00:32:50,080 --> 00:32:52,880 Speaker 17: will underpin all of software, you know, for the next 630 00:32:52,920 --> 00:32:53,960 Speaker 17: ten to twenty years. 631 00:32:54,040 --> 00:32:57,760 Speaker 5: So very much so, yes, okay, I've been excited to 632 00:32:57,760 --> 00:32:58,240 Speaker 5: have you on the show. 633 00:32:58,280 --> 00:33:00,760 Speaker 7: I think it's like a good time to define again 634 00:33:01,280 --> 00:33:03,960 Speaker 7: what is SaaS right, Software as a service. To most people, 635 00:33:03,960 --> 00:33:06,560 Speaker 7: it just means a piece of software or an app 636 00:33:06,560 --> 00:33:09,200 Speaker 7: you can use over the Internet, and in many cases 637 00:33:09,280 --> 00:33:13,000 Speaker 7: that ain't complicated. So is that your definition in terms 638 00:33:13,040 --> 00:33:15,480 Speaker 7: of what you're looking for in a portfolio company. 639 00:33:16,440 --> 00:33:18,640 Speaker 17: I think there's a couple of things to think about. 640 00:33:18,720 --> 00:33:22,400 Speaker 17: There's the underlying infrastructure, and then there's the business model. 641 00:33:22,840 --> 00:33:26,360 Speaker 17: So the infrastructure usually that is associated with SaaS is 642 00:33:26,440 --> 00:33:30,400 Speaker 17: cloud infrastructure, so you have elastic scalability and you have 643 00:33:30,720 --> 00:33:34,000 Speaker 17: multi tenant hosting. Now, SaaS as a business model can 644 00:33:34,040 --> 00:33:37,320 Speaker 17: actually work on a lot of different situations as well, 645 00:33:37,560 --> 00:33:40,280 Speaker 17: and it could be a piece of software that it's 646 00:33:40,280 --> 00:33:42,440 Speaker 17: in a data center, or it could be a shared service, 647 00:33:42,520 --> 00:33:44,920 Speaker 17: or it could be a true multi tenant cloud service. 648 00:33:45,320 --> 00:33:47,880 Speaker 17: I think what is also important for SAS is that 649 00:33:48,160 --> 00:33:52,280 Speaker 17: what used to be SaaS was a traditional subscription for 650 00:33:52,400 --> 00:33:56,040 Speaker 17: a monthly or an annual fee. We're seeing way more 651 00:33:56,120 --> 00:34:00,600 Speaker 17: sophisticated pricing models, which are you the capacity based or 652 00:34:00,720 --> 00:34:04,280 Speaker 17: value based and what have you. So it's evolving continuously, 653 00:34:04,320 --> 00:34:07,480 Speaker 17: but at the core of it, it's about buying software 654 00:34:07,840 --> 00:34:11,920 Speaker 17: on a subscription basis rather than buying a perpetual license. 655 00:34:12,520 --> 00:34:16,400 Speaker 4: You brought back some key LPs British patient Capital, some 656 00:34:16,600 --> 00:34:19,200 Speaker 4: investor example, you brought on some new what is it 657 00:34:19,400 --> 00:34:22,800 Speaker 4: that they like about European VC investing At the moment. 658 00:34:24,120 --> 00:34:27,040 Speaker 17: We're obviously really happy to raise the fund despite these 659 00:34:27,160 --> 00:34:30,720 Speaker 17: very challenging backdrop macroeconomically for a venture as an acid 660 00:34:30,800 --> 00:34:33,280 Speaker 17: class and for you know, venture back growth companies in general. 661 00:34:33,320 --> 00:34:36,960 Speaker 17: I think our model is focused on long term creation 662 00:34:37,080 --> 00:34:40,880 Speaker 17: and avoiding hype cycles, and that has resonated really well 663 00:34:41,040 --> 00:34:45,200 Speaker 17: with both returning and new investors, specifically as it relates 664 00:34:45,239 --> 00:34:48,320 Speaker 17: to Europe and you know, investing into software in Europe. 665 00:34:48,840 --> 00:34:51,919 Speaker 17: There's you know, a sort of coming of age where 666 00:34:51,960 --> 00:34:55,319 Speaker 17: a lot of people are recognizing that the factors that 667 00:34:55,400 --> 00:34:59,799 Speaker 17: have historically favored perhaps much more US companies are you know, 668 00:35:00,120 --> 00:35:02,959 Speaker 17: not as important today when it comes to the availability 669 00:35:03,000 --> 00:35:07,560 Speaker 17: of talent, when it comes to the availability of actually 670 00:35:07,840 --> 00:35:10,960 Speaker 17: dealing with distribution, and in terms of how to thinking 671 00:35:11,040 --> 00:35:14,720 Speaker 17: about scaling commercially, even if you start out in Europe 672 00:35:14,920 --> 00:35:17,560 Speaker 17: with an ambition to have a globally leading company. 673 00:35:18,680 --> 00:35:22,000 Speaker 7: OX co founder general partner Michaelson, thank you so much 674 00:35:22,040 --> 00:35:22,840 Speaker 7: for joining us on the. 675 00:35:22,840 --> 00:35:24,719 Speaker 5: Show here on Bloomberg Technology. 676 00:35:33,200 --> 00:35:37,000 Speaker 3: The great thing about this technology, which it's hard to 677 00:35:37,040 --> 00:35:40,319 Speaker 3: believe is just going on to the year anniversary, it 678 00:35:40,320 --> 00:35:42,520 Speaker 3: seems like it's been here much longer and the pace 679 00:35:42,560 --> 00:35:45,520 Speaker 3: has been incredible, is the fact that you can actually 680 00:35:45,520 --> 00:35:47,360 Speaker 3: put it in the hands of business people. 681 00:35:47,840 --> 00:35:48,839 Speaker 6: And I think that. 682 00:35:49,120 --> 00:35:54,000 Speaker 3: Above all else has really unlocked the ability for people 683 00:35:54,080 --> 00:35:57,640 Speaker 3: to really like imagine how this can be used in 684 00:35:57,680 --> 00:35:58,400 Speaker 3: their businesses. 685 00:35:59,520 --> 00:36:01,479 Speaker 4: A little bit earlier, as I say, with Jp Morgan, 686 00:36:01,520 --> 00:36:03,839 Speaker 4: chief Data and Analytics Officer, trees at Heights and Weather, 687 00:36:04,440 --> 00:36:06,640 Speaker 4: and we want to discuss a little bit more about 688 00:36:06,680 --> 00:36:10,000 Speaker 4: how AI is actually bringing in money, boosting revenue being 689 00:36:10,080 --> 00:36:13,000 Speaker 4: commercially viable at the moment within not just finance, but 690 00:36:13,080 --> 00:36:15,360 Speaker 4: across the board. Nicolo de Massi is Chairman of the 691 00:36:15,360 --> 00:36:17,680 Speaker 4: Futureom Group and you sit on a number of boards 692 00:36:17,719 --> 00:36:20,640 Speaker 4: you were once named Aspat King will delve into that 693 00:36:20,719 --> 00:36:23,440 Speaker 4: in a moment, but I'm interested at the moment with 694 00:36:23,520 --> 00:36:26,799 Speaker 4: ion Q, for example, quantum computing company, how are you 695 00:36:26,880 --> 00:36:31,640 Speaker 4: seeing the commercialization opportunities of generative AI within the companies 696 00:36:31,680 --> 00:36:33,200 Speaker 4: that you help well oversee? 697 00:36:34,280 --> 00:36:37,840 Speaker 18: Yeah, I mean, look, it's coming faster and it's closer 698 00:36:37,880 --> 00:36:40,600 Speaker 18: than everyone thought. When you're talking about quantum machine learning 699 00:36:41,280 --> 00:36:46,080 Speaker 18: and quantum computing intersecting with artificial intelligence and machine vision, 700 00:36:47,320 --> 00:36:50,399 Speaker 18: you know you're seeing it across frankly, every sector, right 701 00:36:50,480 --> 00:36:54,480 Speaker 18: from drug discovery to making next generation batteries, to the. 702 00:36:54,440 --> 00:36:57,440 Speaker 1: Gaming industry to even businesses like. 703 00:36:57,400 --> 00:36:59,840 Speaker 18: The future from group that are taking advantage of a 704 00:37:00,239 --> 00:37:02,839 Speaker 18: across their own market research and advisory. 705 00:37:03,560 --> 00:37:05,080 Speaker 1: I think quantum. 706 00:37:04,680 --> 00:37:07,719 Speaker 18: Advantage is going to happen sooner than people think, and 707 00:37:07,760 --> 00:37:10,319 Speaker 18: it's going to surprise a lot of people. I think 708 00:37:10,360 --> 00:37:13,640 Speaker 18: you're going to see quantum supremacy also come earlier than 709 00:37:13,680 --> 00:37:17,719 Speaker 18: people think in a number of application areas in the 710 00:37:17,760 --> 00:37:20,680 Speaker 18: next few years. And I've been excited to watch the 711 00:37:20,960 --> 00:37:24,839 Speaker 18: breadth of my portfolio have an early lead in their 712 00:37:24,840 --> 00:37:27,400 Speaker 18: respective segments. Right I'm quite proud of the fact that 713 00:37:27,480 --> 00:37:30,480 Speaker 18: we invested early on every board I'm on every company 714 00:37:30,480 --> 00:37:33,120 Speaker 18: I'm involved with, and they really are leaders in the 715 00:37:33,160 --> 00:37:39,200 Speaker 18: respective areas, increasingly partnering with cloud players Amazon, Microsoft, Google, 716 00:37:39,280 --> 00:37:42,480 Speaker 18: hyperscalers and a lot of what I see a lot 717 00:37:42,480 --> 00:37:45,279 Speaker 18: of is the strong partnering with the strong, right, whether 718 00:37:45,280 --> 00:37:48,960 Speaker 18: that's in video with Amazon, im Q with Amazon, Microsoft, Google, 719 00:37:49,239 --> 00:37:51,480 Speaker 18: and I feel like the strongest companies in AI are 720 00:37:51,760 --> 00:37:53,720 Speaker 18: actually entrenching their leads right now. 721 00:37:54,440 --> 00:37:57,000 Speaker 7: Hey, Nikola, real quick though, lots of emphasis on the 722 00:37:57,000 --> 00:38:00,319 Speaker 7: top line revenue, right, people making money, But the and 723 00:38:00,400 --> 00:38:04,680 Speaker 7: learned has been the compute costs astronomical. How worried are 724 00:38:04,719 --> 00:38:07,200 Speaker 7: you about sort of long term anyone actually making any 725 00:38:07,239 --> 00:38:09,840 Speaker 7: profit from all of the R and D and the 726 00:38:09,920 --> 00:38:13,200 Speaker 7: training and inference they're now doing well. 727 00:38:13,280 --> 00:38:16,120 Speaker 18: Quantum computing is actually a solution to that, right in 728 00:38:16,200 --> 00:38:19,920 Speaker 18: terms of energy usage per let's call it calculation or 729 00:38:19,960 --> 00:38:20,440 Speaker 18: Colock tap. 730 00:38:20,680 --> 00:38:20,799 Speaker 8: Right. 731 00:38:20,880 --> 00:38:23,480 Speaker 18: If you look at imq's quantic computers, they're tiny, they 732 00:38:23,520 --> 00:38:26,120 Speaker 18: don't use a lot of power compared to something that 733 00:38:26,160 --> 00:38:28,080 Speaker 18: you know in National Lab. 734 00:38:27,960 --> 00:38:31,319 Speaker 1: Is running, right, And so I'm actually quite bullish. 735 00:38:31,000 --> 00:38:35,319 Speaker 18: That by twenty thirty, quantum AI through the cloud is 736 00:38:35,360 --> 00:38:38,680 Speaker 18: going to change people's perspective on that question you just asked. 737 00:38:39,200 --> 00:38:40,480 Speaker 1: But at the moment you're correct. 738 00:38:40,520 --> 00:38:43,279 Speaker 18: There is a race on that no industry and no 739 00:38:43,360 --> 00:38:46,920 Speaker 18: company can afford to lose. Right if you're a financial 740 00:38:46,960 --> 00:38:50,040 Speaker 18: services firm, your trading arm is not going to make 741 00:38:50,080 --> 00:38:52,840 Speaker 18: any money if you don't have the latest quantum computer 742 00:38:52,880 --> 00:38:56,400 Speaker 18: and the latest AI helping your team. Same in drug discovery, 743 00:38:56,440 --> 00:39:01,080 Speaker 18: same in defense and aerospace, same in cryptograph and so 744 00:39:01,160 --> 00:39:03,400 Speaker 18: I think people right now, you know, have no choice, 745 00:39:03,600 --> 00:39:06,840 Speaker 18: and that means the vendor supplier relationships, the kinds of 746 00:39:06,840 --> 00:39:10,040 Speaker 18: companies the future and groups always advising are really front 747 00:39:10,040 --> 00:39:12,560 Speaker 18: and center right now having to think through where they 748 00:39:12,560 --> 00:39:13,520 Speaker 18: put their dollars to. 749 00:39:13,480 --> 00:39:15,400 Speaker 1: Make sure they max it out, you know, quarter and 750 00:39:15,480 --> 00:39:16,000 Speaker 1: quarter out. 751 00:39:16,760 --> 00:39:17,680 Speaker 6: Sure, but very sweet. 752 00:39:17,680 --> 00:39:19,880 Speaker 4: We thank you for your time, Nicolo de Massi, chairman 753 00:39:19,880 --> 00:39:22,879 Speaker 4: of the Future Room Group. All things focused still on AI, 754 00:39:22,960 --> 00:39:24,400 Speaker 4: of course, and that does it for this addition of 755 00:39:24,400 --> 00:39:25,520 Speaker 4: Bloombo Technology ed. 756 00:39:26,160 --> 00:39:28,520 Speaker 7: Check out the podcast wherever you get your podcasts from 757 00:39:28,560 --> 00:39:29,959 Speaker 7: San Francisco, New York City. 758 00:39:30,000 --> 00:39:31,440 Speaker 5: This is Bloombo Technology