WEBVTT - Latest Offerings for Xbox, Pinnacle Teams Up with TMRW 0:00:01.520 --> 0:00:06.800 From Mahart where Innovations, Money and Power Collie in Silicon Valley, NBN. 0:00:07.160 --> 0:00:11.200 This is Bloomberg Technology with Caroline Hyde and Ed Ludlow. 0:00:24.640 --> 0:00:27.040 I'm Caroline Heide of Bloomberg's world headquarters in New York. 0:00:27.120 --> 0:00:29.760 Ed Ludlow, He's off today. This is Bloomberg Technology. 0:00:30.120 --> 0:00:32.320 Nazac's ten and a half billion dollar deal. We've got 0:00:32.360 --> 0:00:34.800 to talk about it. The financial software maker Denz are 0:00:34.800 --> 0:00:37.640 being bought. We'll bring the details of the exchange operators 0:00:37.680 --> 0:00:40.839 push into software. Plus, we'll break down the biggest takeaways 0:00:40.840 --> 0:00:44.360 from Xboxes Summer showcase, and none other than Phil Spencer, 0:00:44.440 --> 0:00:47.599 Microsoft Gaming CEO. And we'll speak with a former president 0:00:47.640 --> 0:00:49.640 of Tesla who currently sits on the board at GM. 0:00:49.920 --> 0:00:52.600 He's going to discuss why the ev makers charging stations 0:00:52.600 --> 0:00:54.880 are quickly becoming the industry standard. 0:00:55.440 --> 0:00:57.360 First, let's check in on these markets. 0:00:57.400 --> 0:00:59.720 Actually, SMB five roundred back in that ballmarket territory to 0:01:00.040 --> 0:01:02.160 cent off of its previous lows, managed to hold into 0:01:02.200 --> 0:01:02.960 them ahead of. 0:01:02.920 --> 0:01:03.560 The Federal Reserve. 0:01:03.600 --> 0:01:05.480 This week, in fact a jam pack week, we're hearing 0:01:05.480 --> 0:01:08.720 from Mike ni Key CPI prints retail data coming forward, 0:01:08.800 --> 0:01:11.080 and also the ECB back of Japan, you name it. 0:01:11.120 --> 0:01:13.480 There's big macro data on deck. Now's that one hundred 0:01:13.480 --> 0:01:16.160 pushing up tech outperforming on the day, we're up nine 0:01:16.120 --> 0:01:18.679 tenths percenters. Many feel that, look, we're going to get 0:01:18.680 --> 0:01:20.520 a pause at least from the Federal Reserve, the Central 0:01:20.560 --> 0:01:22.800 Bank to the world, and that means interest rates just 0:01:22.880 --> 0:01:25.200 could be keeping on a steady path for at least 0:01:25.200 --> 0:01:27.880 the next month. Bitcoin off by more than a percentage point. 0:01:27.920 --> 0:01:30.560 Yet again, we're still seeing some woes of regulatory risk 0:01:30.640 --> 0:01:32.880 being priced in. At the moment, we're off to twenty 0:01:32.920 --> 0:01:34.880 five eight hundred and thirty two is where we trade. 0:01:34.959 --> 0:01:36.720 Let's move on to some of the micro moves in 0:01:36.760 --> 0:01:39.120 terms of the individual stocks to watch Apple. I mean, 0:01:39.160 --> 0:01:41.640 when you've got a point higher on Apple, when you're 0:01:41.640 --> 0:01:44.240 moving up three tens three quarters of a percent, no 0:01:44.360 --> 0:01:48.240 wonder big tech manages to outperform, still getting that sort 0:01:48.280 --> 0:01:51.520 of hazy rosy glow post their announcement of their latest 0:01:51.760 --> 0:01:54.240 product and a lease. Tesla also at more than a 0:01:54.280 --> 0:01:56.040 percentage point. We're going to dig into how this is 0:01:56.040 --> 0:01:58.440 a record run twelve straight days against for Tesla's We 0:01:58.480 --> 0:02:01.720 think about how perhaps slightly un sexy world of charging 0:02:01.840 --> 0:02:04.680 is becoming the piesta resistance to this particular company. And 0:02:04.720 --> 0:02:07.600 we've got to talk about the downward trajectory of the 0:02:07.680 --> 0:02:10.480 company that is Nasdaq, so not the benchminent world course, 0:02:10.520 --> 0:02:12.600 it operates the benchmarket. It's all about indices, but it's 0:02:12.600 --> 0:02:14.280 also about software, about technology data. 0:02:14.280 --> 0:02:15.240 It's off by thirteen. 0:02:14.960 --> 0:02:17.000 Percent because a bit of M and A in the air. 0:02:17.040 --> 0:02:20.400 This Monday, NASDAK agreeing to buy financial software maker Adenza 0:02:20.800 --> 0:02:22.880 ten and a half billion dollars. Look, it's the exchange 0:02:22.880 --> 0:02:26.799 operator's biggest ever deal. We want to bring in other 0:02:26.840 --> 0:02:29.640 than our M and A expert now with Bloomberg opinion 0:02:29.760 --> 0:02:33.639 one Ed Hammond. And this is a company that has 0:02:33.680 --> 0:02:36.640 already made MNA to build up the software offering to 0:02:36.639 --> 0:02:39.440 be able to provide more than just prices. 0:02:39.880 --> 0:02:41.359 Is it about reducing volatility? 0:02:43.280 --> 0:02:46.040 It is about reducing volatility, I think, Fanasdek it's about 0:02:46.040 --> 0:02:49.360 reducing the independence on the markets. And obviously right now 0:02:49.480 --> 0:02:52.120 the markets are highly volatile and probably will continue to 0:02:52.160 --> 0:02:54.560 be volatile for some time. And this is something they've 0:02:54.600 --> 0:02:56.320 been you know, as you say, through M and A 0:02:56.919 --> 0:02:59.280 and indeed organically have been trying to build out for 0:02:59.320 --> 0:03:02.399 a while, sort of moving away from that pure dependence 0:03:02.400 --> 0:03:04.720 on markets, and this takes them in that direction. I 0:03:04.720 --> 0:03:07.520 think it's the biggest deal in their history, and obviously 0:03:07.520 --> 0:03:09.200 that's the way they're trying to sell it to investors. 0:03:09.240 --> 0:03:10.440 But if you just look at the way the shares 0:03:10.440 --> 0:03:13.240 are trading today, investors do not seem so taken with 0:03:13.320 --> 0:03:15.520 the idea as perhaps nos Deck would like them to be. 0:03:15.680 --> 0:03:17.679 Yeah, and some of the numbers perhaps a little underwhelming 0:03:17.720 --> 0:03:19.440 when you think about the size of the deal and 0:03:19.480 --> 0:03:22.400 the solutions business is there for going to become seventy 0:03:22.560 --> 0:03:26.360 seven percent of total revenue from seventy one percent today, 0:03:26.440 --> 0:03:28.799 So what really is this ten and a half billion 0:03:28.800 --> 0:03:30.560 dollars going to be buying them? Because it doesn't even 0:03:30.560 --> 0:03:32.519 be that are creative to their revenue immediately. 0:03:33.040 --> 0:03:34.960 Yeah, I don't think it is set accreative to their 0:03:34.960 --> 0:03:37.560 revenue immediately. I think this is part of a long 0:03:37.680 --> 0:03:40.320 term plan and a plan to as I say, rebalance 0:03:40.360 --> 0:03:43.040 the business away from the volatility that they've talked about, 0:03:43.800 --> 0:03:45.920 and investors maybe you know, look, they're looking at this 0:03:46.000 --> 0:03:48.120 and thinking this will be a good deal over time, 0:03:48.200 --> 0:03:50.280 but that may take a while to sort of come 0:03:50.280 --> 0:03:53.600 to fruition and to sort of bear the rewards that 0:03:54.000 --> 0:03:56.440 the narzdeck obviously hopes it will. I think the other 0:03:56.480 --> 0:03:58.400 thing here is, look, it is just a very big 0:03:58.480 --> 0:04:00.800 number in terms of pure dollar act. That is a 0:04:00.840 --> 0:04:03.320 it's a big deal. It's much more sizable than anything else, 0:04:03.360 --> 0:04:05.400 know stack I've ever done. And also they are giving 0:04:05.400 --> 0:04:08.200 away as part of the consideration for the deal, they're 0:04:08.200 --> 0:04:11.240 giving away to Tomo Bravo a significant amount of stock. 0:04:11.320 --> 0:04:13.480 Toma Bravo I think will become the second largest sholder 0:04:13.520 --> 0:04:16.080 with a shade under fifteen percent of the total, right 0:04:16.120 --> 0:04:17.440 behind Boors Dubai. 0:04:17.680 --> 0:04:20.000 And a board seat as well, and a. 0:04:20.080 --> 0:04:22.240 Board seat to Holden Spat, who is you know, obviously 0:04:22.279 --> 0:04:25.440 a very very senior and very successful person within Tomo Bravo. 0:04:25.520 --> 0:04:27.440 Yeah, I mean talk to us about how this company, 0:04:27.440 --> 0:04:29.920 Agenza was even built really by Toma Bravo. 0:04:30.560 --> 0:04:33.560 It's a classic Tomeo Bravo play. Something they do a 0:04:33.560 --> 0:04:36.719 lot of something. Actually they're sort of the industry leader 0:04:36.760 --> 0:04:38.760 in and something of a pioneering which is that they 0:04:38.760 --> 0:04:42.800 buy a technology asset, having already identified other technology assets 0:04:43.080 --> 0:04:44.880 that they could buy and put together with it to 0:04:44.960 --> 0:04:48.359 sort of create a bigger, better company. You know, some 0:04:48.400 --> 0:04:51.040 people would perhaps pejoratively call that a roll up strategy. 0:04:51.120 --> 0:04:51.600 I think of it. 0:04:51.800 --> 0:04:54.719 With them, it's it's slightly different because they're actually maybe 0:04:54.760 --> 0:04:57.719 just buying you know, two or three of these businesses 0:04:57.720 --> 0:04:59.680 and trying to make a sort of you know, a 0:04:59.720 --> 0:05:02.400 some greater than the past. They did that here with 0:05:02.800 --> 0:05:06.440 two companies, Axiom and a company called Calypso which they 0:05:06.440 --> 0:05:08.279 brought a few years ago, and they've put them together 0:05:08.600 --> 0:05:10.720 under a single leadership within their firm. 0:05:10.760 --> 0:05:12.480 And then obviously a finding an. 0:05:12.360 --> 0:05:14.880 Exit like this, and they've done it before, either selling 0:05:14.920 --> 0:05:17.320 companies that they've put together as a sort of single 0:05:17.360 --> 0:05:19.920 deal or taking them public through the IPO markets. 0:05:20.400 --> 0:05:21.960 Ed, so great to have you with us. 0:05:22.120 --> 0:05:24.280 Thank you very much to need Ed Hammond on the 0:05:24.400 --> 0:05:26.560 Nators big deal in the markets, We're going to turn 0:05:26.600 --> 0:05:28.440 our attention to a man who knows how to make 0:05:28.480 --> 0:05:30.880 an M and a deal or to himself and talk 0:05:30.920 --> 0:05:33.279 to CEOs about it, but also someone who's looking at 0:05:33.400 --> 0:05:36.880 how we're building the next big giants in technology, particularly 0:05:36.880 --> 0:05:39.480 when comes to AI. Daniel Newman is with us his 0:05:39.760 --> 0:05:42.600 Forturum Group CEO right here in New York, and you 0:05:42.600 --> 0:05:44.360 yourself have done a fair bit of and a you've 0:05:44.400 --> 0:05:47.560 looked to build owned businesses. Are you expecting more M 0:05:47.600 --> 0:05:49.720 and A in this market? More generally, it's interesting in 0:05:49.760 --> 0:05:51.760 the time where interest rates arriving and we know that 0:05:51.839 --> 0:05:54.960 NASA's actually taking on debt to do this, that it's 0:05:55.000 --> 0:05:56.839 an interesting moment for companies to be trying to beef 0:05:56.839 --> 0:05:57.440 themselves up. 0:05:57.720 --> 0:06:00.480 I still think there's a lot of consideration about valuation. 0:06:00.839 --> 0:06:03.200 You know, we've seen the technology market come back, so 0:06:03.320 --> 0:06:06.279 those valuations have started to rise back up. But with 0:06:06.360 --> 0:06:08.880 this rapid onset of generative AI, companies have to move 0:06:08.920 --> 0:06:12.279 faster to move their businesses in the right direction. Karen, 0:06:12.440 --> 0:06:14.680 if you think about it, we saw in less than 0:06:14.680 --> 0:06:17.120 seven months an onset of a new technology, and in 0:06:17.120 --> 0:06:19.919 the last four weeks we've seen that go from something 0:06:19.920 --> 0:06:23.000 that you had to specialize skill in house to now 0:06:23.040 --> 0:06:25.760 being able to use something like Google's Generative App Builder 0:06:26.040 --> 0:06:28.239 to be able to take your entire business and build 0:06:28.279 --> 0:06:28.679 new apps. 0:06:28.839 --> 0:06:30.000 Companies have to move quick. 0:06:29.839 --> 0:06:31.840 And M and A does give that advantage of moving 0:06:31.880 --> 0:06:33.239 faster than building things in house. 0:06:33.400 --> 0:06:35.520 Yeah, perhaps a little bit of respite from the whole 0:06:35.520 --> 0:06:38.520 thing being about generative AI in this particular deal. But 0:06:38.520 --> 0:06:41.120 talk to us about where you are seeing generative AI 0:06:41.279 --> 0:06:43.440 just suck all the oxygen from the room. You've been 0:06:43.440 --> 0:06:45.919 putting out some thought leadership around, well, who's going to 0:06:45.920 --> 0:06:47.279 be the next in video, who's going to be the 0:06:47.279 --> 0:06:50.320 next trillion dollar company to add to the club? 0:06:50.720 --> 0:06:52.679 Yeah, well, about two and a half years ago, carolen 0:06:52.720 --> 0:06:54.800 I actually called it in video, would be the next 0:06:54.800 --> 0:06:56.240 trillion dollar company. 0:06:56.240 --> 0:06:59.520 And on ai or hy on Ai on ai. 0:06:59.640 --> 0:07:02.279 Now, part of it had to do with the potential 0:07:02.320 --> 0:07:04.520 of the arm deal, but I said either way, it 0:07:04.600 --> 0:07:07.000 was the only company that fully committed to it. Every 0:07:07.000 --> 0:07:09.880 other company was kind of dabbling in it. Jensen never wavered, 0:07:10.200 --> 0:07:12.440 and when the market sort of vacillated, even back to 0:07:12.440 --> 0:07:14.400 about a year and a year ago last summer, when 0:07:14.400 --> 0:07:16.720 it was down to lows around one hundred dollars, people 0:07:16.720 --> 0:07:19.800 were saying, oh, it's done, you know, metaversus don ais slow, 0:07:20.080 --> 0:07:21.360 and then all of a sudden you see it rise back, 0:07:21.360 --> 0:07:22.680 and everyone's like they're not surprised. 0:07:22.680 --> 0:07:24.520 But people just ride the trends. 0:07:24.560 --> 0:07:26.440 And the truth is that all this generative value you 0:07:26.440 --> 0:07:28.600 hear about whether it's open ai, whether it's barred, whether 0:07:28.640 --> 0:07:31.120 it's hugging face in these large language models. Right now, 0:07:31.200 --> 0:07:33.240 they're being trained on in video. Now, are there other 0:07:33.280 --> 0:07:38.480 companies could could? Amd, Intel, Broadcom, Marvel, These other semi 0:07:38.560 --> 0:07:40.360 companies play a big part. I think there's going to 0:07:40.360 --> 0:07:42.840 be a second company, Caroline that has to rise. But 0:07:42.920 --> 0:07:45.680 right now in video's got the route and that's why 0:07:45.680 --> 0:07:48.440 it's accelerating so fast is because no one else can offer. 0:07:48.520 --> 0:07:51.200 It's the completeness of the Nvidia stack. 0:07:51.320 --> 0:07:53.800 I mean, you mentioned valuations and they're just eyewatering in 0:07:53.880 --> 0:07:56.880 video currently trading versus future. 0:07:56.600 --> 0:08:00.720 Earnings at fifty one times. I mean, it's interesting. 0:08:00.760 --> 0:08:03.200 We've been thinking about Oracle, whose earnings come out after 0:08:03.240 --> 0:08:06.040 the bell. They're being piled into because they've got a 0:08:06.120 --> 0:08:10.000 less extraordinary valuation, but still a focus on AI. Who 0:08:10.040 --> 0:08:12.960 are the other companies that you're starting to call could 0:08:13.000 --> 0:08:14.400 be trillion on a company? 0:08:14.520 --> 0:08:18.000 Some of them obviously are that I had Google and 0:08:18.080 --> 0:08:20.200 Microsoft and there I actually put Oracle on my recent 0:08:20.240 --> 0:08:23.920 list of companies. And that's because the data, the enterprise data, 0:08:23.960 --> 0:08:26.040 the rich data that sits in the Oracle ecosystem is 0:08:26.080 --> 0:08:27.800 going to have to be utilized to give companies a 0:08:27.800 --> 0:08:31.239 competitive advantage. Right now, the open AI ecosystem has almost 0:08:31.280 --> 0:08:33.760 become table stakes. Every company can tap into it. Every 0:08:33.760 --> 0:08:35.520 company can use it. You look at what Bloomberg's doing 0:08:35.520 --> 0:08:37.840 with its own GPT. You have all this rich data 0:08:38.000 --> 0:08:40.880 and that's the competitive differentiator. So does Oracle, so does SAP. 0:08:41.280 --> 0:08:43.200 Another company I really like is Service Now. I've had 0:08:43.200 --> 0:08:45.560 a number of conversations with CEO Bill McDermott about it. 0:08:45.760 --> 0:08:49.160 I think he really gets kind of this aggregation that's 0:08:49.160 --> 0:08:51.160 going to take place of software. Nobody wants to tap 0:08:51.160 --> 0:08:53.960 into a CRM and ERP and HTM, all these different tools. 0:08:54.080 --> 0:08:56.640 They want to hit one aggregation layer. They want to 0:08:56.720 --> 0:08:59.479 prompt something and say give me the thirty day forecast. 0:08:59.520 --> 0:09:00.880 Just ask it, just like we ask Google. 0:09:01.000 --> 0:09:02.800 But right now we got all these systems of record 0:09:02.840 --> 0:09:05.480 and they're really they're not that friendly to use. So 0:09:05.520 --> 0:09:07.720 this is where generators could really make a difference. 0:09:07.960 --> 0:09:08.720 To that point. 0:09:08.840 --> 0:09:11.640 I mean, every day we have another company coming on 0:09:12.080 --> 0:09:14.920 to talk to us about how they've introduced generative AI 0:09:14.960 --> 0:09:19.280 into their offerings. Will there ultimately still be the room 0:09:19.480 --> 0:09:22.640 for all of these enterprise software companies as they stand, 0:09:22.720 --> 0:09:25.120 or are you saying, actually you need an aggregator as such? 0:09:25.480 --> 0:09:27.440 Well, you know I'm here in New York to go 0:09:27.480 --> 0:09:29.720 here from Mark Benioff. He's going to do the salesforce. 0:09:29.760 --> 0:09:33.000 AI launched today. Every company seems to have a story, 0:09:33.040 --> 0:09:34.720 and we're kind of listening right now. And what I'm 0:09:34.720 --> 0:09:37.000 finding is there's two things the market's listening for. One is, 0:09:37.240 --> 0:09:40.000 can you clearly help them market understand how you're going 0:09:40.040 --> 0:09:43.319 to monetize AI content, meaning you know, adding its table stakes. 0:09:43.360 --> 0:09:45.120 There are some companies that's always been there and people 0:09:45.160 --> 0:09:47.600 aren't seeing a lot of value because they were already 0:09:47.720 --> 0:09:50.680 pricing it in. There's other companies where it's obvious and 0:09:50.720 --> 0:09:53.199 a parent and those companies have gotten a huge jolt. 0:09:53.600 --> 0:09:56.839 So as I see it, you know the AI run is. 0:09:56.760 --> 0:09:58.920 Going to take place as companies can start to articulate 0:09:59.000 --> 0:10:02.079 what is the addition of AI bringing to the table 0:10:02.120 --> 0:10:04.199 for their customers and are they able to charge any 0:10:04.240 --> 0:10:06.000 more for it and all these software comings. Right now, 0:10:06.000 --> 0:10:07.800 it seems like it's table sakes. They have to put 0:10:07.800 --> 0:10:10.440 it in, but our customer is willing to pay any 0:10:10.440 --> 0:10:12.439 more for it, and that hasn't been clear yet. 0:10:12.600 --> 0:10:13.959 Has the hype gone too far? Then? 0:10:14.920 --> 0:10:17.560 Well, I think the usability the utility of this generative 0:10:17.600 --> 0:10:20.760 AI is pretty immense, and so the hype hasn't necessarily 0:10:20.800 --> 0:10:22.840 gone too far, But has the market gotten a little 0:10:22.840 --> 0:10:24.160 bit frothy on it? How long is it going to 0:10:24.200 --> 0:10:26.240 take to catch up? I mean, look, the reason Nvidia 0:10:26.280 --> 0:10:28.839 has gone so far is because it's the shovels, the 0:10:28.880 --> 0:10:30.760 picks and axes, and it's also all the software to 0:10:30.840 --> 0:10:33.439 develop it. But at the edge, at the software and 0:10:33.480 --> 0:10:36.560 on all these devices, the utilization of generative, it's pretty 0:10:36.640 --> 0:10:39.080 unclear how we're going to update our spreadsheets to show 0:10:39.320 --> 0:10:40.240 future values. 0:10:40.640 --> 0:10:43.600 So I think we've gotten a little bit ahead of ourselves. 0:10:43.640 --> 0:10:45.600 But there's no doubt that our world is going to 0:10:45.640 --> 0:10:47.480 change and the way we work and how productive we are, 0:10:47.520 --> 0:10:50.840 it's all going to be driven by these new AI technologies. 0:10:50.400 --> 0:10:52.760 Really well articulated. Thanks so much for being here, Go 0:10:52.880 --> 0:10:55.720 enjoy the event. Daniel Newman of Forture Group. 0:10:55.840 --> 0:10:56.320 We thank him. 0:10:56.360 --> 0:10:59.360 Meanwhile, coming up gaming news, pick them fast out of 0:10:59.400 --> 0:11:03.120 Microsoft Xbox updates, new games. We're talking about the platforms 0:11:03.160 --> 0:11:05.760 as well, so much to digest the Microsoft Gaming CEO, 0:11:05.800 --> 0:11:06.400 Phil Spencer. 0:11:06.440 --> 0:11:07.000 He joins us. 0:11:07.000 --> 0:11:09.360 Next, and let's just take a quick look at Microsoft 0:11:09.400 --> 0:11:11.280 shares as we had to break because of course, this 0:11:11.400 --> 0:11:14.040 is a company that's been fueled on artificial intelligence. 0:11:14.040 --> 0:11:15.880 Hopes and dreams. It's pairing with open Ai. 0:11:16.440 --> 0:11:18.480 How much are we starting to see a focus on 0:11:18.800 --> 0:11:20.800 its own m and a of course activision Blizzard? 0:11:20.800 --> 0:11:22.920 Will that become reality? How much of a gaming. 0:11:22.640 --> 0:11:24.720 Win can it be to take away some of the 0:11:25.520 --> 0:11:28.600 extraordinary peal that its rivals have had. It also within 0:11:28.640 --> 0:11:31.520 the console market, rap three tens percent this bloom back. 0:11:40.120 --> 0:11:41.800 It's going viral. You econdo missed it. 0:11:41.880 --> 0:11:45.760 Yesterday's Microsoft just wrapping up its annual summer showcase for Xbox, 0:11:45.760 --> 0:11:49.400 announcing well thirteen new games from its own studios, not 0:11:49.480 --> 0:11:51.480 to mention the third parties, an update to its current 0:11:51.559 --> 0:11:54.840 Xbox series s with some improved storage and please to say, 0:11:55.120 --> 0:11:57.840 coming off of some of the adrenaline Russia. Is Phil Spencer, 0:11:57.880 --> 0:12:02.000 Microsoft Gaming CEO, joining us to yesterday's event in LA 0:12:02.080 --> 0:12:04.719 and you talk about the platform, you talk about the 0:12:04.720 --> 0:12:07.520 additions from the gaming line up in particular, and Phil, 0:12:07.679 --> 0:12:10.880 you call it your most ambitious games. Ever, just how 0:12:11.040 --> 0:12:14.840 crucial is it that Starfield becomes a blockbuster for you? 0:12:16.280 --> 0:12:19.200 I think in general, our first party games library is 0:12:19.240 --> 0:12:23.079 important for us for many different reasons. Starfield's obviously a 0:12:23.120 --> 0:12:25.520 big show that we focused on. We gave it over 0:12:25.600 --> 0:12:28.720 forty minutes with the Starfield direct but all of the games. 0:12:28.760 --> 0:12:30.199 I mean, one of the things I was very proud 0:12:30.200 --> 0:12:32.880 of the show yesterday was the diversity of games, games 0:12:32.880 --> 0:12:35.160 for everybody. We want to love a lot of people 0:12:35.200 --> 0:12:38.160 to love Starfield, but from the opening of Fable to 0:12:38.280 --> 0:12:41.440 games like flight simulator, Forts and Motorsport, we want to 0:12:41.440 --> 0:12:43.920 have games for everybody, and the quality of those games 0:12:43.960 --> 0:12:45.240 is very important Xbox. 0:12:46.040 --> 0:12:49.520 Let's talk about some of the prior lack of quality, 0:12:49.520 --> 0:12:51.120 if I can say it in a sort of slightly 0:12:51.120 --> 0:12:53.160 brutal mannun to you, Peel, because there is this worry 0:12:53.200 --> 0:12:56.160 about red Fall in particular, and what ultimately have been 0:12:56.160 --> 0:12:58.880 the lessons you learned from what many might see as 0:12:59.080 --> 0:13:00.880 a kind of flop when it was introduced a few 0:13:01.080 --> 0:13:03.080 a month or so ago. How are you going to 0:13:03.080 --> 0:13:05.400 differently support your own game studios in the back of that. 0:13:06.520 --> 0:13:08.559 Yeah, you know, we came off a really good run 0:13:08.640 --> 0:13:12.200 in twenty twenty one. The studio behind Redfall also did 0:13:12.440 --> 0:13:16.280 games like Death Loop, which was incredibly well received. We 0:13:16.360 --> 0:13:19.640 had Hi Fi Rush earlier this year. But gaming is 0:13:19.679 --> 0:13:22.160 a creative endeavor and teams are going to try to 0:13:22.160 --> 0:13:24.280 do ambitious things, and we want to hit our goals 0:13:24.360 --> 0:13:27.000 with everything we try to do, and sometimes that won't 0:13:27.000 --> 0:13:29.000 happen and you hit it exactly what we need to do. 0:13:29.240 --> 0:13:31.679 We need to learn, internalize what we could do better 0:13:31.720 --> 0:13:34.400 improve our process, and I believe we've done that, and 0:13:34.440 --> 0:13:37.160 I think the reaction to the show yesterday shows that 0:13:37.200 --> 0:13:39.760 gamers have a really high anticipation for the games that 0:13:39.800 --> 0:13:40.760 are coming to Xbox. 0:13:41.080 --> 0:13:42.719 Is your process then more hands on. 0:13:44.720 --> 0:13:47.240 And we definitely have tried to be hands on all 0:13:47.240 --> 0:13:49.680 the way through the process. I'd say when we acquire 0:13:49.720 --> 0:13:51.880 a studio or build a new team, the thing we 0:13:51.960 --> 0:13:54.920 want to do is work really closely with them to 0:13:54.920 --> 0:13:57.080 allow them to be the best version of the team 0:13:57.120 --> 0:13:59.720 that they can be. We've been working on Starfield with 0:13:59.760 --> 0:14:03.200 the team at Bethesda Game Studios for really years now 0:14:03.520 --> 0:14:05.400 to make sure we're going to build the right game, 0:14:05.520 --> 0:14:09.079 and helping teams realize their true vision. 0:14:08.920 --> 0:14:10.520 Is definitely part of what it means to be part 0:14:10.559 --> 0:14:11.160 of Xbox. 0:14:11.880 --> 0:14:14.280 Of course, the big elephant in the room is what 0:14:14.360 --> 0:14:18.760 you might still be buying, Phil and with twenty seven, 0:14:19.000 --> 0:14:21.320 what was it other games coming on tap? 0:14:21.480 --> 0:14:21.640 As? 0:14:21.680 --> 0:14:24.520 You say more than ten being produced in turning by 0:14:24.560 --> 0:14:27.520 your own game studios already and does this mean. 0:14:27.360 --> 0:14:29.480 That you kind of don't need Activision Blizzard. 0:14:31.080 --> 0:14:33.080 The thing that's always been unique to us when we've 0:14:33.080 --> 0:14:36.160 looked at Activision Blizzard King is the capability they have 0:14:36.240 --> 0:14:38.880 on mobile. And I know it gets lost sometimes, but 0:14:39.240 --> 0:14:42.040 the largest gaming platform in the world are people playing 0:14:42.120 --> 0:14:45.960 on their mobile phones. Activision Blizzard, through their acquisition of King, 0:14:46.400 --> 0:14:48.680 through the growth of Candy Crush, through the growth of 0:14:48.680 --> 0:14:51.160 Call of Duty Mobile, the work that they've done with 0:14:51.200 --> 0:14:54.160 Blizzard on mobile devices. That was the thing that really 0:14:54.200 --> 0:14:57.280 attracted us to Activision was actually the work that they're 0:14:57.280 --> 0:15:00.680 doing on mobile, and I'm encouraged by that is going 0:15:00.720 --> 0:15:03.760 to achieve its goals of being a global gaming platform 0:15:03.840 --> 0:15:06.880 for the over three billion people who play video games. 0:15:07.080 --> 0:15:09.560 We need to be relevant on mobile and on console 0:15:09.680 --> 0:15:12.320 and on PC, and we think Activision is an important 0:15:12.320 --> 0:15:12.760 part of that. 0:15:13.120 --> 0:15:15.640 It is an uphill battle, though it is really hard 0:15:15.640 --> 0:15:17.960 to change hearts and minds on the CMA. 0:15:18.640 --> 0:15:19.560 Do you think you can do that? 0:15:19.560 --> 0:15:22.320 Particularly with the news We understand that Activision itself is 0:15:22.320 --> 0:15:26.800 going to be granted permission to intervene in the legal dispute. 0:15:26.840 --> 0:15:29.760 Now I've been involved in this process now for over 0:15:29.800 --> 0:15:32.400 a year. It's been a learning experience for me and 0:15:32.440 --> 0:15:35.760 I reflect on our process with the European Commission, where 0:15:35.760 --> 0:15:39.240 we spend a lot of time listening to concerns, coming 0:15:39.320 --> 0:15:42.320 up with solutions that met the needs of the regulators. 0:15:42.320 --> 0:15:45.400 And as you know, we received approval in the European Commission. 0:15:45.400 --> 0:15:47.880 If you include the countries of Europe, we have approval 0:15:47.920 --> 0:15:51.520 I think in forty plus markets right now globally. You 0:15:51.600 --> 0:15:53.760 mentioned we're going to focus on the UK, We're going 0:15:53.800 --> 0:15:56.480 to focus on the US with that same approach. We 0:15:56.520 --> 0:15:59.000 want to listen to the concerns. We want to come 0:15:59.080 --> 0:16:01.960 up with active solutions that we believe we can implement 0:16:02.320 --> 0:16:04.080 and come to a good outcome for us. 0:16:04.120 --> 0:16:05.760 And we remain confident that we can do that. 0:16:06.800 --> 0:16:08.920 If and I'm sure this is an awful thing to 0:16:08.920 --> 0:16:11.080 have to think about, but everyone's got to think about 0:16:11.080 --> 0:16:13.800 all the outcomes. If you don't get it. What is 0:16:13.840 --> 0:16:17.640 your future for mobile gaming? Will you build internally? Is 0:16:17.680 --> 0:16:19.120 it about other acquisitions? 0:16:20.480 --> 0:16:23.720 It could be about both. I mean we're definitely building internally. 0:16:23.800 --> 0:16:24.080 Now. 0:16:24.880 --> 0:16:28.200 We have more Xbox users on mobile than we've ever had, 0:16:28.560 --> 0:16:32.280 but we're so small, and obviously in mobile specifically, you 0:16:32.360 --> 0:16:35.240 have two big companies in Apple and Google that really 0:16:35.320 --> 0:16:39.200 control every game that somebody sees on those platforms and 0:16:39.320 --> 0:16:40.479 all of the monetization. 0:16:41.000 --> 0:16:41.720 So for us to. 0:16:41.720 --> 0:16:44.440 Achieve our goals globally, we are going to have to 0:16:44.480 --> 0:16:47.480 find a way to build more presence on mobile. We 0:16:47.560 --> 0:16:50.920 think ABK is a great way to increase competition in 0:16:50.960 --> 0:16:53.960 the gaming market given that the largest gaming platform, mobile 0:16:54.040 --> 0:16:56.720 is controlled by two other companies. So we think it's 0:16:56.760 --> 0:16:59.400 a benefit, but it is not the strategy and to itself. 0:16:59.440 --> 0:17:03.760 The strategy itself finding new players, finding creators. We have 0:17:03.880 --> 0:17:06.440 more games being built on Xbox than we've ever had 0:17:06.480 --> 0:17:09.280 in our history right now in that mix of millions 0:17:09.280 --> 0:17:11.959 of players finding all of these games that creators are 0:17:12.000 --> 0:17:14.520 building is the magic of what we have with Xbox, 0:17:14.560 --> 0:17:15.959 and we need to extend that to mobile. 0:17:16.359 --> 0:17:19.400 And it's the way you talk about you want diversity, 0:17:19.520 --> 0:17:21.800 not only diversity of people building the games, but the 0:17:21.920 --> 0:17:24.960 use how you actually consume them. Cloud gaming of course 0:17:25.000 --> 0:17:26.800 a key feature in that in many ways, Phil, But 0:17:27.400 --> 0:17:30.160 it's interesting the UK took issue with cloud gaming worrying 0:17:30.200 --> 0:17:32.960 about your deal sort of killing that nascent space EU 0:17:33.080 --> 0:17:36.159 saying you would be a pro competitive kickstart to cloud 0:17:36.160 --> 0:17:38.639 streaming market. How is the cloud streaming market going? Is 0:17:38.640 --> 0:17:40.359 it growing at the rate you see and want? 0:17:40.400 --> 0:17:42.200 Because what is it? Only about one to three percent 0:17:42.240 --> 0:17:43.399