WEBVTT - The State of the Cloud 0:00:01.760 --> 0:00:04.400 This is Bloomberg Business Week. I'm Karl Masser and I'm 0:00:04.440 --> 0:00:07.280 Bloomberg Quick Takes Tim Stanavak. We're here every day bringing 0:00:07.280 --> 0:00:09.800 you the latest news from the world of business and finance, 0:00:09.800 --> 0:00:13.640 clus technology, politics, economics, all partnising the power of Business 0:00:13.640 --> 0:00:17.119 Week reporters and editors, not to mention our journalists and 0:00:17.120 --> 0:00:19.960 analyst in more than one twenty countries. You can download 0:00:20.000 --> 0:00:23.200 Bloomberg Business Week and iTunes, SoundCloud, or Bloomberg dot com. 0:00:23.360 --> 0:00:25.160 You can also listen to our radio show at two 0:00:25.160 --> 0:00:27.840 pm Eastern Time on Bloomberg Radio, or watch us on 0:00:27.880 --> 0:00:31.400 YouTube search Bloomberg Global News. At the start of the year, 0:00:31.440 --> 0:00:34.479 Bloomberg reported on how the global cloud computing market is 0:00:34.520 --> 0:00:38.040 expected to reach approximately when and a half trillion by 0:00:38.080 --> 0:00:40.840 so growing at a compound annual growth rate of nearly 0:00:40.960 --> 0:00:44.159 sixteen percent. This according to a study by grand View Research. 0:00:44.479 --> 0:00:46.480 Really pleased to have with us this afternoon, Hillary Hunter, 0:00:46.560 --> 0:00:50.080 Chief technology Officer at IBM Cloud. Hillary joins us via 0:00:50.159 --> 0:00:52.519 zoom from New York City. This afternoon, Hillary, how are you. 0:00:53.040 --> 0:00:55.440 I am great, Thanks for having me. Thanks so much 0:00:55.480 --> 0:00:57.400 for joining us. Hey, before you get into the nitty 0:00:57.400 --> 0:01:00.320 gritty of this report, that you guys did with Harris Poll, 0:01:00.520 --> 0:01:02.440 which I think is really interesting. I want to get 0:01:02.440 --> 0:01:04.800 an idea of the landscape right now because Caroline I 0:01:04.840 --> 0:01:08.000 talk a lot about you know, cloud spending and tech spending, 0:01:08.000 --> 0:01:11.720 and I'm wondering, is the volatility that companies are facing 0:01:11.840 --> 0:01:17.520 higher input costs is that right now affecting their cloud spending. Yeah, 0:01:17.560 --> 0:01:19.800 you know, I think it's driving a really important conversation 0:01:19.840 --> 0:01:21.720 that relates to this pole we're going to talk about, 0:01:21.760 --> 0:01:24.800 which is really looking for value stream generation out of 0:01:24.800 --> 0:01:27.880 a cloud transformation. UM. Folks are looking because of the 0:01:27.920 --> 0:01:30.600 factors you indicated to do something other than just stick 0:01:30.640 --> 0:01:33.280 the website on a cloud or run the HR application 0:01:33.319 --> 0:01:36.000 on the cloud. They're looking for where can cloud actually 0:01:36.040 --> 0:01:39.280 help me address elasticity and grow my business faster and 0:01:39.319 --> 0:01:42.040 save costs. And that has to do with moving more 0:01:42.080 --> 0:01:45.760 substantive pieces of a business to the cloud. So, you know, 0:01:45.760 --> 0:01:47.200 it's interesting. I just want to kind of push a 0:01:47.200 --> 0:01:49.680 little bit out on Hillary if I can um on 0:01:49.760 --> 0:01:51.880 what tim ass because I think one of the things 0:01:51.960 --> 0:01:54.240 we're trying to figure out where this economy, this global 0:01:54.280 --> 0:01:57.400 economy goes next, is you know, technology spending so important 0:01:57.400 --> 0:02:00.840 to companies because I have to, and also it's a 0:02:00.920 --> 0:02:03.480 great way in terms of productivity gains. So are you 0:02:03.560 --> 0:02:06.680 seeing though before we get a little bit deeper into 0:02:07.080 --> 0:02:10.120 this report, are you guys seeing any slow down or 0:02:10.160 --> 0:02:13.639 push back UM when it comes to companies and their 0:02:13.639 --> 0:02:16.560 willingness to spend on anything and everything to do with 0:02:16.600 --> 0:02:19.760 the cloud. Yeah. Actually, you know, we continue to see 0:02:19.800 --> 0:02:23.120 strong glow growth and cloud consumption because it is that 0:02:23.280 --> 0:02:26.440 part of transformation. It's a part of being able to 0:02:26.520 --> 0:02:29.400 change a business reach more customers, and so actually, I 0:02:29.400 --> 0:02:31.720 think in most cases it can actually be a solution 0:02:32.120 --> 0:02:35.720 to those types of optimizations and cost savings that enterprises 0:02:35.760 --> 0:02:38.320 are looking to find these days. So interesting, I mean, 0:02:38.360 --> 0:02:40.560 is it is it seen as like, is it seen 0:02:40.639 --> 0:02:44.679 is essential rather than discretionary? Yeah? You know, you you 0:02:44.960 --> 0:02:47.079 spend to keep the lights on, You spend to address, 0:02:47.160 --> 0:02:49.520 you know, in a regulated industry what the regulators need 0:02:49.560 --> 0:02:52.000 you to do, and you spend to continue to run 0:02:52.040 --> 0:02:56.480 your business efficiently. UM find opportunities for automation and other 0:02:56.520 --> 0:02:59.240 things like that, and so it really is critical to 0:02:59.280 --> 0:03:01.799 continue to modernized it in order to be able to 0:03:01.840 --> 0:03:04.240 address times like these. When it comes to security, though, 0:03:04.280 --> 0:03:07.680 I think there is you know, as we've seen some 0:03:07.760 --> 0:03:11.720 really massive security lapses UM globally over the last few years. 0:03:12.000 --> 0:03:15.120 How much is being maybe pulled off the cloud and 0:03:15.240 --> 0:03:18.680 rather keeping you know, being kept more close to home. UM, 0:03:18.720 --> 0:03:20.799 what are you seeing between that mix of up in 0:03:20.840 --> 0:03:23.840 the cloud versus you know, on home territory in your 0:03:23.840 --> 0:03:26.880 own kind of hardware. Yeah, you know, it's it's such 0:03:26.919 --> 0:03:29.440 an important question, and it's actually relates to this this 0:03:29.480 --> 0:03:31.800 pool that we just put out this transformation in Ducks 0:03:31.880 --> 0:03:36.480 because over of participants and respondents to this pool said 0:03:36.520 --> 0:03:39.160 that hybrid cloud, which is actually a little bit different 0:03:39.160 --> 0:03:42.760 than how you just maybe accidentally described cloud. A lot 0:03:42.760 --> 0:03:45.000 of people think of cloud as this this place that 0:03:45.080 --> 0:03:47.360 you have to move things to UM, and that can 0:03:47.400 --> 0:03:50.440 sometimes be scary. We need to really seriously think about 0:03:50.480 --> 0:03:53.760 the security, the compliance, the data privacy, data protection in 0:03:53.800 --> 0:03:56.520 that place when you're moving things to a cloud. But 0:03:56.680 --> 0:03:59.200 hybrid cloud technologies that we do now we we have 0:03:59.240 --> 0:04:03.160 over four thousand customers with IDMS hybrid cloud approach. Hybrid 0:04:03.160 --> 0:04:06.440 cloud enables you also to use the efficiency of cloud 0:04:06.480 --> 0:04:09.520 and the deployment optimizations and even the operating model of 0:04:09.560 --> 0:04:12.120 cloud on your own premises, so you don't have to 0:04:12.160 --> 0:04:15.600 move the data in order to benefit from everything from 0:04:15.640 --> 0:04:20.560 automation to AI technologies to the efficient development mechanisms that 0:04:20.560 --> 0:04:23.320 cloud brings in place. And so hybrid cloud is now 0:04:23.360 --> 0:04:26.679 increasingly being viewed as a solution to that that challenge 0:04:26.680 --> 0:04:29.240 that you mentioned around data protection. So is it about 0:04:29.279 --> 0:04:31.680 data protection or is more so than it is about 0:04:33.040 --> 0:04:36.120 speed or latency? I mean, is it is it all 0:04:36.160 --> 0:04:38.960 because of data protection? Yeah? You know, it's interesting. We 0:04:39.040 --> 0:04:42.800 see also with public cloud UM that data protection is 0:04:42.839 --> 0:04:46.159 an increasing topic. Even though you might say, oh, cloud 0:04:46.240 --> 0:04:50.599 is about elasticity or optionality or global expansion. UM. The 0:04:50.680 --> 0:04:55.360 data protection factor here is really important because every enterprise 0:04:55.440 --> 0:04:58.320 has a responsibility to steward their data. You know, you 0:04:58.400 --> 0:05:01.480 and I as as as consumer as UH as customers 0:05:01.480 --> 0:05:05.320 of a bank or retail organization. We want our data protected. 0:05:05.400 --> 0:05:10.520 And in many jurisdictions, UM organizations have an obligation legally 0:05:10.600 --> 0:05:13.479 to protect their clients data, not just the reputation with 0:05:13.520 --> 0:05:16.920 the clients, but also legal and from a regulatory perspective. 0:05:17.440 --> 0:05:20.120 And when we look at this then in a cloud conversation, 0:05:20.160 --> 0:05:22.640 it's important both to have hybrid cloud where you can 0:05:22.760 --> 0:05:26.360 choose to continue to consume cloud technologies while the data 0:05:26.400 --> 0:05:29.000 remains on premises as well as what we referred to 0:05:29.120 --> 0:05:31.960 as industry clouds, where in the public cloud, like with 0:05:32.040 --> 0:05:35.560 IBMS Cloud for financial services, you can have industry leading 0:05:35.640 --> 0:05:39.400 data protection and data privacy policies even when deploying in 0:05:39.440 --> 0:05:42.320 the public cloud. So then you really have optionality. You 0:05:42.360 --> 0:05:44.839 can have cloud on premises or you can have it 0:05:44.920 --> 0:05:48.240 safely in public cloud as well. Hey, you know, in 0:05:48.279 --> 0:05:50.800 your role as chief Technology Officer at IBM, I do 0:05:50.880 --> 0:05:52.720 under Hillary too. Though, Like kind of going back to 0:05:52.760 --> 0:05:55.640 where we started a little bit of macro um what 0:05:55.720 --> 0:05:58.360 kind of environment are you guys getting ready for them? 0:05:58.400 --> 0:05:59.720 I know we talked a little bit about what you're 0:05:59.720 --> 0:06:02.719 seeing from your customers, but it is kind of a 0:06:02.760 --> 0:06:06.680 tricky time, uh. And you know, we see inflation continuing 0:06:06.720 --> 0:06:09.320 to be persistent, Supply chains have gotten better, but we 0:06:09.360 --> 0:06:13.600 still hear about component problems in various industries, worried about 0:06:13.640 --> 0:06:18.160 a global economic slowdown. How would you best describe kind 0:06:18.160 --> 0:06:21.120 of our environment? Yeah, you know, I think it's an 0:06:21.200 --> 0:06:23.880 environment with a lot of opportunity. Like we're talking about 0:06:23.920 --> 0:06:27.960 at the beginning, UM cloud in technology, everything from you know, 0:06:28.120 --> 0:06:32.560 AI technologies to business process automation to the elasticity of cloud. 0:06:32.600 --> 0:06:34.599 You know, if you don't want to run a business anymore, 0:06:35.240 --> 0:06:37.560 scale down on the consumption of the I t you 0:06:37.560 --> 0:06:39.600 you didn't invest in it on your premises, you can 0:06:39.640 --> 0:06:42.000 scale it down in the cloud. UM as well as 0:06:42.040 --> 0:06:45.080 continuing also on premises to adopt, you know, faster, more 0:06:45.120 --> 0:06:48.960 efficient technologies. All these things are key parts of you know, 0:06:49.000 --> 0:06:52.320 addressing you know, where enterprises need to be thinking these days. 0:06:52.360 --> 0:06:54.839 And I think we're just continuing to invest in those 0:06:54.920 --> 0:06:58.039 those core technologies that are going to help folks UM, 0:06:58.080 --> 0:06:59.919 you know, go through this this period that we have 0:07:00.120 --> 0:07:04.240 coming up successfully. I'll also comment you mentioned supply chain UM. 0:07:04.279 --> 0:07:07.000 The topic of risk in the supply chain also from 0:07:07.040 --> 0:07:10.760 a cybersecurity perspective UM is one that definitely came up 0:07:10.760 --> 0:07:13.280 in this this index that we just released UM, and 0:07:13.320 --> 0:07:16.160 I think there's there's a lot of really important work 0:07:16.160 --> 0:07:18.040 going on in that area as well. Hey, Hillary, before 0:07:18.040 --> 0:07:19.360 we let you go, I mean, you know, we hear 0:07:19.400 --> 0:07:21.120 from a lot of different companies about the cloud, about 0:07:21.120 --> 0:07:23.560 the hybrid cloud. When a company is considering who to 0:07:23.640 --> 0:07:26.040 go with, an IBM IS is one of those choices. 0:07:27.360 --> 0:07:30.000 What are the competitive advantages that you offer, Like why 0:07:30.160 --> 0:07:33.120 choose you rather than you know, another service provider. Yeah, 0:07:33.160 --> 0:07:35.120 you know this, This index that we just released of 0:07:35.200 --> 0:07:39.200 over three thousand global leaders cited skills, cited security, and 0:07:39.240 --> 0:07:42.600 cited compliance as three of the top areas for consideration. 0:07:42.800 --> 0:07:45.200 And at IBM, that's really what we're trying to address. 0:07:45.240 --> 0:07:47.200 It's a journey. It's a journey to get to the cloud. 0:07:47.600 --> 0:07:50.400 Need to partner with someone who, like IBM Consulting, has 0:07:50.480 --> 0:07:53.480 in house skills to both look at transformation, find those 0:07:53.560 --> 0:07:56.240 high value applications and get you to the cloud. You 0:07:56.280 --> 0:07:59.440 need to partner with someone who both in on premises UM, 0:07:59.480 --> 0:08:01.800 you know, with with heritage environments as well as with 0:08:01.880 --> 0:08:05.640 cloud environments, is focused on security and compliance and data protection. 0:08:06.080 --> 0:08:08.400 And you need to partner with someone that knows your industry. 0:08:08.440 --> 0:08:11.640 IBM has long been the I T provider to you know, banks, 0:08:11.640 --> 0:08:15.560 insurance companies, Tauco's, you name it, healthcare, government UM and 0:08:15.640 --> 0:08:17.800 so as we work at this next generation of I T, 0:08:18.000 --> 0:08:20.080 we're also that partner. All right, good to check in 0:08:20.120 --> 0:08:22.320 with you, and here about your report. We got around 0:08:22.400 --> 0:08:25.800 Hillary Hunter, chief technology officer at IBM Cloud with us 0:08:26.240 --> 0:08:30.120 via zoom from New York City. You're listening to Bloomberg 0:08:30.160 --> 0:08:33.840 Business Week with Carol Messer and Bloomberg Quick Takes Tim 0:08:33.920 --> 0:08:37.079 Stinovic on Bloomberg Radio. So there's a story on the 0:08:37.120 --> 0:08:40.440 Bloomberg Today about how climate change made Hurricane Ian's most 0:08:40.440 --> 0:08:42.839 extreme rainfall about ten percent worse than would have been 0:08:43.320 --> 0:08:47.040 without two centuries two centuries of greenhouse gas pollution. This 0:08:47.080 --> 0:08:49.400 is according to a first take analysis of the storm 0:08:49.440 --> 0:08:52.800 by two US climate researchers. Their rapid analysis, which they 0:08:52.840 --> 0:08:55.679 shared on Twitter, looked only at rainfall and not other 0:08:55.720 --> 0:08:59.040 critical climate metrics related to hurricanes, such as strength and toesifications, 0:08:59.080 --> 0:09:01.880 sea level rise. But you know, we know that these 0:09:01.920 --> 0:09:04.960 storms may be not more frequent, but their intensity has 0:09:05.000 --> 0:09:07.439 definitely wrapped out because of climate change, and that's something 0:09:07.480 --> 0:09:10.200 that we obviously need to think about. We've got somebody 0:09:10.200 --> 0:09:11.839 with us who thinks about this stuff a lot, and 0:09:11.960 --> 0:09:14.640 Jason Few is CEO of fuel Cell Energy. It's a 0:09:14.640 --> 0:09:17.920 publicly traded company. Uh. He joins us this afternoon on 0:09:17.960 --> 0:09:21.400 the phone from Danbury, Connecticut. Jason, how are you? I 0:09:21.440 --> 0:09:23.520 am good, Thank you very much. How are you doing? 0:09:23.640 --> 0:09:26.120 To him, We're doing pretty well. Um. Can you explain 0:09:26.160 --> 0:09:29.400 how fuel cells work? Because I think a lot of people. Um, 0:09:29.760 --> 0:09:34.480 you know, we understand batteries, we understand internal combustion, but 0:09:34.640 --> 0:09:37.360 fuel cells it's something that I think is not necessarily 0:09:37.360 --> 0:09:40.600 on all of our radar. It's certainly not on mine. Sure, 0:09:40.640 --> 0:09:42.240 So I think if you think about it and its 0:09:42.320 --> 0:09:46.960 most simple terms, and we just use batteries as an analogy, Uh, 0:09:47.040 --> 0:09:50.240 you know, batteries you put energy in and then you 0:09:50.360 --> 0:09:53.080 drain it and then you need to recharge the battery. 0:09:53.520 --> 0:09:55.480 The way you can think about a fuel cell is 0:09:55.520 --> 0:09:59.560 that we use an input feedstock for the fuel cell, 0:10:00.080 --> 0:10:02.959 and that allows the fuel cell to run and operate 0:10:03.080 --> 0:10:06.040 on a continual basis, you know, seven days a week, 0:10:06.080 --> 0:10:10.280 twenty four hours a day, without the need to recharge 0:10:10.400 --> 0:10:14.560 the battery. And because it's a fuel cell, it actually 0:10:14.640 --> 0:10:18.880 uses a chemical reaction to actually take a fuel and 0:10:19.000 --> 0:10:22.280 air and effectively make hydrogen and then to use that 0:10:22.360 --> 0:10:25.880 hydrogen to produce power. And so it works very different 0:10:25.920 --> 0:10:30.120 than a traditional combustion engine that you know takes and 0:10:30.120 --> 0:10:33.800 and basically combust the fuel. With a fuel cell, the 0:10:33.840 --> 0:10:36.320 fuel is not combusted, so you don't produce things like 0:10:36.360 --> 0:10:39.640 socks and knox and other particulars that play very heavily 0:10:39.720 --> 0:10:44.120 on you know climate as well as air quality, what 0:10:44.200 --> 0:10:47.280 are the byproducts that it does end up releasing that 0:10:47.320 --> 0:10:50.880 it does produce, So it really depends on what is 0:10:51.000 --> 0:10:54.360 the actual feedstock that you're using. So in a case 0:10:54.480 --> 0:10:57.680 where you know, we're working to commercialize our solid oxide 0:10:57.679 --> 0:11:01.599 fuel cell, and in that case, we could use hydrogen, 0:11:01.920 --> 0:11:05.840 and that hydrogen could be made from all renewable energy sources. 0:11:05.880 --> 0:11:09.120 So in that case, there are no byproducts that are 0:11:09.120 --> 0:11:12.840 produced other than water, you know, from the hydrogen. The 0:11:12.920 --> 0:11:16.640 second way we're if we're using a traditional fuel, let's 0:11:16.679 --> 0:11:21.439 say a biofuel or renewable natural gas or even um 0:11:21.800 --> 0:11:25.920 uh natural gas, then the byproduct is you do have 0:11:26.000 --> 0:11:30.040 some carbon emissions. But if you're using biofuels are R 0:11:30.120 --> 0:11:33.480 and G right, that's considered carbon neutral, and again there's 0:11:33.520 --> 0:11:36.160 no combustion of the fuel uh. And then we also 0:11:36.240 --> 0:11:38.560 have the ability to do things like carbon capture or 0:11:38.559 --> 0:11:41.599 what we refer to as well as carbon separation to 0:11:42.000 --> 0:11:46.760 significantly reduce or eliminate those carbon emissions. And when you 0:11:46.800 --> 0:11:50.160 think about it in total, when you when you look 0:11:50.160 --> 0:11:54.200 at fuel cells versus renewable energy sources, let's say like 0:11:54.240 --> 0:11:57.640 wind and solar, because the fuel cells are more efficient 0:11:57.800 --> 0:12:01.240 and they run twenty four by seven, and you think 0:12:01.280 --> 0:12:05.600 about just overall avoided emissions because you know, you actually 0:12:05.720 --> 0:12:09.440 end up with greater emission reductions with fuel cells in 0:12:09.480 --> 0:12:12.000 most cases than you do when you're using renewable energy 0:12:12.000 --> 0:12:14.920 because you may only be getting twenty to thirty percent 0:12:15.000 --> 0:12:18.040 efficiency from those resources and then you need to get 0:12:18.080 --> 0:12:22.240 power from somewhere else. So, you know, it's interesting we 0:12:22.280 --> 0:12:24.599 all have a lot of conversations about what is ultimately 0:12:24.679 --> 0:12:28.559 the solution um to climate change, and as we move 0:12:28.600 --> 0:12:33.079 towards an alternative energy you know, uh, world if you will, 0:12:33.360 --> 0:12:36.520 and hydrogen doesn't. It doesn't it feel like there's momentum 0:12:36.559 --> 0:12:39.440 building um in general. But talk to us about some 0:12:39.480 --> 0:12:41.960 of the concerns when it comes to fuel cells, and 0:12:42.000 --> 0:12:45.040 some of it is the cost, the durability, some of 0:12:45.040 --> 0:12:48.760 it is concerns about flammability. Feel so, what what is 0:12:48.800 --> 0:12:51.160 it the thing, the nut that you feel like we 0:12:51.200 --> 0:12:56.079 still have to crack before we get kind of mass adoption. Well, 0:12:56.120 --> 0:12:59.160 that's a great question, and I feel cell Energy we 0:12:59.360 --> 0:13:03.160 do two things as a company. We decarbonized power and 0:13:03.200 --> 0:13:06.240 we produce hydrogen. Those are the two things we do 0:13:06.760 --> 0:13:10.880 with our platform technology. When you think about some of 0:13:10.880 --> 0:13:13.640 those concerns or areas that you raise. You know, we've 0:13:13.679 --> 0:13:18.200 had commercial available products since two thousand and three, and 0:13:18.240 --> 0:13:21.000 in fact, our first commercial fuel cell was sold actually 0:13:21.040 --> 0:13:25.000 in Japan to the Cairn and Beer Company using biofuels, 0:13:25.040 --> 0:13:29.160 So you know, it just shows the fuel flexibility of 0:13:29.200 --> 0:13:32.480 the platform when it comes to hydrogen and some of 0:13:32.480 --> 0:13:35.640 the concerns that you know get raised around hydrogen. You know, 0:13:35.720 --> 0:13:40.200 hydrogen is used widely, you know, around the world. You know, 0:13:40.440 --> 0:13:42.880 ninety minute metric tons of year of hydrogen are used. 0:13:42.920 --> 0:13:47.800 There's some forecast that suggests that you know, of the 0:13:47.800 --> 0:13:51.520 world's energy will ultimately come from hydrogen, if not greater 0:13:51.600 --> 0:13:54.600 than that. We tend to think that hydrogen is going 0:13:54.600 --> 0:13:56.920 to be an important part of the solution, the same 0:13:56.960 --> 0:13:59.360 way we think carbon capture will be an important part 0:13:59.360 --> 0:14:02.280 of the solution to achieving the one and a half 0:14:02.360 --> 0:14:06.720 degree scenario in terms of climate change itself. And and 0:14:06.760 --> 0:14:09.640 from a safety standpoint, like I said, you know, hydrogen 0:14:09.760 --> 0:14:13.920 widely used today, it's very safe and unlike a battery, 0:14:14.280 --> 0:14:18.520 which contains everything that you need inside the battery to 0:14:18.559 --> 0:14:21.280 actually start a fire, that's not the case with hydrogen. 0:14:21.480 --> 0:14:25.520 So it's actually quite today. So why isn't adopted more widespread? 0:14:25.560 --> 0:14:29.960 Why will it maybe only of energy um production in 0:14:30.000 --> 0:14:33.720 the years to come, Why not more Well, I think 0:14:33.720 --> 0:14:36.520 part of it is, UH, there's a cost question right 0:14:36.640 --> 0:14:40.480 in terms of this this desire to have green hydrogen. 0:14:40.600 --> 0:14:43.120 One of the things that I'm really excited about is 0:14:43.160 --> 0:14:45.760 the move not only in the United States, but I'm 0:14:45.800 --> 0:14:49.000 I'm seeing in countries around the world and the conversations 0:14:49.080 --> 0:14:52.320 we're having and in the conversation I actually just got 0:14:52.360 --> 0:14:57.560 to participate in UH in Pittsburgh with Secretary Grant Home 0:14:57.720 --> 0:15:01.000 and energy ministers from around the world at a CEO 0:15:01.080 --> 0:15:06.120 Hydrogen roundtable. The conversation is shifted from using colors to 0:15:06.240 --> 0:15:09.680 really talk about carbon intensity, and I think that's one 0:15:09.840 --> 0:15:13.880 big change that's going to help drive accelerated adoption. Another 0:15:14.400 --> 0:15:17.160 change or thing that's happening that's going to help drive 0:15:17.240 --> 0:15:20.080 adoption is the work that you're seeing that's going to 0:15:20.160 --> 0:15:21.880 get done as a result of the i ra A 0:15:21.960 --> 0:15:25.080 in the United States. You have similar legislation in markets 0:15:25.120 --> 0:15:28.840 like Korea and Japan and across the EU. And we've 0:15:28.880 --> 0:15:33.200 seen this movie play out before. We saw how incentives, 0:15:33.520 --> 0:15:37.400 whether it's I T C production, tax credits, those kind 0:15:37.400 --> 0:15:40.840 of things really help drive the cost curve down. We're 0:15:40.840 --> 0:15:44.520 gonna see that same thing happen with fuel cells and 0:15:44.520 --> 0:15:47.720 with hydrogen as an effective way to get us to 0:15:48.480 --> 0:15:52.080 the cost that everyone's targeting, you know, which is you know, 0:15:52.280 --> 0:15:55.720 as low as a dollar a telegram for hydrogen, and 0:15:55.760 --> 0:15:58.240 that's going to make it highly competitive. And I think 0:15:58.560 --> 0:16:01.080 as you look around the world to day and you're 0:16:01.080 --> 0:16:05.280 seeing increased energy prices, those sparks spreads are narrowing. Uh 0:16:05.320 --> 0:16:07.200 and and so I think you're going to see adoption 0:16:07.320 --> 0:16:11.800 start to accelerate with hydrogen as one of the answers 0:16:11.840 --> 0:16:14.920 to solving this climate crisis we have today. From an 0:16:14.960 --> 0:16:18.240 infrastructure perspective, when it comes to generating power, explained to 0:16:18.320 --> 0:16:21.480 us how you take a facility and allow it to 0:16:21.640 --> 0:16:27.200 create power using hydrogen using fuel cells versus using fossil fuels. Yeah, 0:16:27.280 --> 0:16:31.960 So when you think about um an input fuel, and 0:16:32.440 --> 0:16:36.400 you think about hydrogen, hydrogen just becomes the input fuel 0:16:36.840 --> 0:16:39.760 that we would be using with our solid oxide platform 0:16:39.920 --> 0:16:43.280 for instance, in which we would take that hydrogen and 0:16:43.320 --> 0:16:47.560 we use that hydrogen as the feedstock to create electricity. 0:16:47.600 --> 0:16:52.560 That hydrogen interacts with the fuel cell right, and and 0:16:52.600 --> 0:16:55.640 the chemistry that we use in this case of solid 0:16:55.680 --> 0:16:59.880 oxide technology to produce that power. And if that hyd 0:17:00.040 --> 0:17:05.200 ygen was produced by you know, a zero carbon source 0:17:05.520 --> 0:17:08.680 of electricity. Let's say you're using electrolysis, so you're taking 0:17:08.720 --> 0:17:12.320 electricity and water and you're converting at the hydrogen, then 0:17:12.359 --> 0:17:16.480 you're using that hydrogen to produce power. That hydrogen has 0:17:16.920 --> 0:17:20.680 zero carbon intensity, then the power being produced from our 0:17:20.720 --> 0:17:24.480 platform is zero carbon. But we also have the ability 0:17:24.560 --> 0:17:28.240 to use blended hydrogen and natural gas for example, which 0:17:28.280 --> 0:17:31.439 even lowers you know, the carbon intensity of the fuel 0:17:31.600 --> 0:17:37.240 in that case. But in all cases, whether it's hydrogen, renewval, 0:17:37.320 --> 0:17:40.320 natural gas, or bio fuels, that serves as the input 0:17:40.359 --> 0:17:43.720 fuel that the fuel cell needs to then convert that 0:17:44.080 --> 0:17:47.679 to power, whether it's for the grid or for a 0:17:47.680 --> 0:17:51.800 commercial industrial customer. Uh and delivering that power as a 0:17:51.880 --> 0:17:57.720 as a product. Hey, I'm curious, Jason um about the 0:17:57.720 --> 0:17:59.879 business and the business outlook and the growth. And I 0:18:00.000 --> 0:18:03.399 know earlier this month you came out with your latest 0:18:03.440 --> 0:18:05.600 update quarterly update. I think there was a wider than 0:18:05.600 --> 0:18:09.760 expected loss for the quarter, strongest quarterly revenue in five years. Um, 0:18:09.840 --> 0:18:11.760 and you guys talked about an increase in marketing and 0:18:12.240 --> 0:18:16.320 consulting costs because you had raised headcount for rebranding, accelerated 0:18:16.720 --> 0:18:20.199 and accelerating your sales and commercialization efforts. Give us some 0:18:20.280 --> 0:18:22.840 more color, if you will, in terms of the business 0:18:22.880 --> 0:18:27.480 who's buying um You guys have you know customers, certainly 0:18:27.480 --> 0:18:29.880 in the energy space and the corporate space, But give 0:18:29.920 --> 0:18:31.920 us an idea of where the growth is coming from 0:18:31.960 --> 0:18:36.280 from your business. Sure, so are the customers that we 0:18:36.440 --> 0:18:41.399 target largely cut across the utility sector where we're providing 0:18:41.760 --> 0:18:44.960 grid based power, and we might be providing that power 0:18:45.080 --> 0:18:49.159 purely is just a power resource on the grid, or 0:18:49.200 --> 0:18:52.600 we might be providing that power and using the thermal 0:18:52.680 --> 0:18:55.160 energy where we might be connected to a district heating 0:18:55.240 --> 0:18:57.879 system and we're providing that thermal energy in addition to 0:18:57.960 --> 0:19:01.360 the power. Or we might be an in a microgrid 0:19:01.680 --> 0:19:05.000 configuration where we're providing power to the grid and in 0:19:05.119 --> 0:19:07.600 the power outage, we go into what we refer to 0:19:07.680 --> 0:19:10.920 as island mode and we provide power to a dedicate 0:19:10.960 --> 0:19:15.720 a set of resources, keeping those critical resources powered while 0:19:15.800 --> 0:19:20.960 the grid is down. We also serve commercial and industrial customers, 0:19:21.040 --> 0:19:24.000 and in many of those cases we're providing power to 0:19:24.119 --> 0:19:27.359 those customers, and again we might be providing the thermal 0:19:27.480 --> 0:19:31.840 energy such that they're using steam from our platform in 0:19:31.840 --> 0:19:36.080 their manufacturing process. Uh. And we also have the ability 0:19:36.520 --> 0:19:39.639 to do things like provide carbon to those customers. So 0:19:39.640 --> 0:19:43.480 when you think about carbonated beverage companies, are you think 0:19:43.480 --> 0:19:47.119 about food processing where carbon is really important to not 0:19:47.240 --> 0:19:52.280 only processing proteins, but then extending shelf life by keeping 0:19:52.320 --> 0:19:56.520 those proteins chilled. Uh. Those are always in which we 0:19:56.840 --> 0:19:59.959 leverage our platforms to deliver value to our customers. In addition, 0:20:00.080 --> 0:20:03.880 the hydrogen and we're going to projects for Toyota today 0:20:03.960 --> 0:20:07.760 we will deliver hydrogen to Toyota Power and water all 0:20:07.840 --> 0:20:09.880 from the same platform at the Port of Long Beach 0:20:09.880 --> 0:20:13.879 in California. Go go ahead. A very quick question. I 0:20:13.960 --> 0:20:15.879 just want to know about price increases, Jason. When it 0:20:15.920 --> 0:20:17.760 comes to the commodities that you actually use, are you 0:20:17.760 --> 0:20:21.639 seeing the prices come down at all? We were seeing 0:20:22.560 --> 0:20:26.560 different reactions to different commodities. So for example, if you 0:20:26.640 --> 0:20:30.080 take nickel as a commodity, we've seen price decreases there. 0:20:30.480 --> 0:20:34.800 We're seeing obviously price increases for natural gas. So as 0:20:34.840 --> 0:20:37.840 we look across our supply chain. We've had a very 0:20:37.920 --> 0:20:42.639 focused approach on managing those price increases to minimize the 0:20:42.680 --> 0:20:45.600 impacts for us in terms of pricing to our customers. 0:20:45.960 --> 0:20:49.640 But we are seeing some price improvements across the supply chain. Well. 0:20:49.800 --> 0:20:51.840 Really great to check in with you and really appreciate 0:20:51.840 --> 0:20:54.760 your time. Jason, take care of Jason fu chief executive 0:20:54.800 --> 0:20:57.960 officer at fuel Cell Energy. They are a one point 0:20:57.960 --> 0:21:00.639 for a billion dollar market cap company and great to 0:21:00.640 --> 0:21:03.200 have him join us from I believe their corporate offices 0:21:03.200 --> 0:21:06.840 in Connecticut. You're listening to Bloomberg Business Week with Carol 0:21:06.920 --> 0:21:11.359 Messer and Bloomberg Quick Takes Tim Stinovic on Bloomberg Radio. 0:21:11.480 --> 0:21:13.359 We talked about earlier how we buried the lead at 0:21:13.359 --> 0:21:15.840 the top of the show because Kim Kardashian it is 0:21:15.840 --> 0:21:19.040 among the most red storaking news. We talked about with 0:21:19.040 --> 0:21:21.920 our TV colleagues recently about her one point three million 0:21:21.920 --> 0:21:25.520 dollar SEC fine. Uh. We also know the chairman of 0:21:25.520 --> 0:21:27.440 the SEC weighed in on it earlier, but we'll get 0:21:27.440 --> 0:21:28.920 to that in just a moment. The medtime, we want 0:21:28.920 --> 0:21:30.679 to talk to our own Scarlet Food. She is a 0:21:30.680 --> 0:21:33.440 Bloomberg Business of Sports host. You also know her as 0:21:33.480 --> 0:21:35.840 a Bloomberg Quick Take correspondent. She's with us right now 0:21:35.920 --> 0:21:40.720 in the Bloomberg Interactive a broker's studio. Scar Uh, what 0:21:40.800 --> 0:21:42.760 do we need to know about this fine? Because you know, 0:21:42.800 --> 0:21:44.800 I hear one point three million dollars in the context 0:21:44.880 --> 0:21:47.639 of any Kardashian and I think to myself, that's like 0:21:47.680 --> 0:21:51.160 the change, That's like the change they find in the couch. Well, yes, 0:21:51.240 --> 0:21:53.400 and she also did not admit or deny any wrong, 0:21:53.440 --> 0:21:56.040 but she paid, she did pay up, and she's cooperating 0:21:56.040 --> 0:21:58.960 with the sec. What's significant here is that she got 0:21:58.960 --> 0:22:01.960 paid two hundred fifth eight thousand dollars by theorym of 0:22:02.040 --> 0:22:06.000