WEBVTT - Apple's Product Launch and Google's Antitrust Challenge 0:00:01.680 --> 0:00:06.000 From Mahard where Innovation, Money and power Collie in Silicon 0:00:06.080 --> 0:00:10.559 Vallet NBN. This is Bloomberg Technology with Caroline Hyde and 0:00:10.760 --> 0:00:22.520 Ed Ludlow. 0:00:24.920 --> 0:00:29.520 I'm Caroline Heider Bloomberg's World headquarters in New York. 0:00:29.320 --> 0:00:31.720 And I'm Ed Ludlow live in cu Patino here at 0:00:31.760 --> 0:00:35.000 the Apple campus. Behind me the Steve Jobs Theater. This 0:00:35.040 --> 0:00:38.760 is a special Bloomberg Technology for coverage of Apple's iPhone event. 0:00:39.320 --> 0:00:42.040 So much to digest coming up on this program. We'll have, 0:00:42.200 --> 0:00:45.400 of course, that extended coverage on apple It's product launch 0:00:45.479 --> 0:00:48.240 as the company of course spaces internal chip delays, restrictions 0:00:48.240 --> 0:00:51.320 in China and a shifting supply chain. Will break down 0:00:51.520 --> 0:00:54.600 everything you need to know and will cover Google's biggest 0:00:54.600 --> 0:00:57.520 antitrust challenge yet that is the Department of Justice and 0:00:57.680 --> 0:01:00.840 thirty five US states through the Search Chime, accusing it 0:01:00.920 --> 0:01:04.480 of maintaining a monopoly over the search market. Or details ahead, 0:01:04.800 --> 0:01:07.680 and we'll hear from Endeavor president as Mark Shapiro. As 0:01:07.680 --> 0:01:10.640 the company completes it's takeover a WWE and combines it 0:01:10.880 --> 0:01:15.080 with UFC to create a newly publicly traded fighting giant 0:01:15.120 --> 0:01:18.800 will talk for streaming implications all that and so much 0:01:18.959 --> 0:01:22.399 more ahead. But first and foremost, we've got to be 0:01:22.440 --> 0:01:25.480 discussing what's happening in the world of Apple. And this 0:01:25.640 --> 0:01:29.000 really is an exciting time in terms of the fifteen launch. 0:01:29.000 --> 0:01:31.360 I almost feel we know exactly what to anticipate. We 0:01:31.400 --> 0:01:34.160 always know. Our reporting is so strong here at Bloomberg, 0:01:34.200 --> 0:01:37.040 but there is a lot of headwinds facing Apple. Do 0:01:37.040 --> 0:01:38.720 you think that we can see the tailwinds today? 0:01:38.680 --> 0:01:43.000 Yeah, And it's why the iPhone is everything. That's kind 0:01:43.040 --> 0:01:45.640 of the key of what we're expecting. Four variants of 0:01:45.680 --> 0:01:48.840 the next generation iPhone fifteen, a base model, an iPhone 0:01:48.880 --> 0:01:51.520 fifteen plus, and then a Pro and Pro Max. And 0:01:51.560 --> 0:01:54.440 as you know, Caro, Apple kind of reserves its biggest 0:01:54.440 --> 0:01:58.160 technological updates for those Pro lines. Higher price point it 0:01:58.240 --> 0:02:01.200 raises the average selling price. Is it enough to convince 0:02:01.200 --> 0:02:03.480 the consumer to upgrade? We know there are tens, if 0:02:03.480 --> 0:02:07.320 not hundreds of millions of older generation iPhone handsets out there. 0:02:07.640 --> 0:02:09.120 Are they going to be able to boost volumes or 0:02:09.160 --> 0:02:10.760 are they going to rely on higher prices? 0:02:10.760 --> 0:02:11.960 That's going to be a key question. 0:02:12.200 --> 0:02:14.120 And now are we going to see revenues start to 0:02:14.200 --> 0:02:16.360 increase again? This is of course the key to two 0:02:16.480 --> 0:02:20.040 hundred billion dollar juggernaut of Apple's revenue, that is the phone. 0:02:20.120 --> 0:02:22.080 Let's dig into it always, So please to welcome Mark 0:02:22.120 --> 0:02:24.600 Gammon to the show, of course, who has already kind 0:02:24.639 --> 0:02:27.640 of braced us for what to expect throughout the announcements. 0:02:27.720 --> 0:02:30.359 But is it all about getting them to pay a 0:02:30.440 --> 0:02:31.560 higher price point? Mark? 0:02:33.360 --> 0:02:36.720 Certainly, Apple is pushing, like Ed said, it's latest features 0:02:36.720 --> 0:02:40.040 and advancements to the higher end models. Right, They're going 0:02:40.080 --> 0:02:42.560 to be differentiating the Pro models from the non Pro 0:02:42.639 --> 0:02:45.040 models more than ever. Right, And on top of that, 0:02:45.120 --> 0:02:48.080 the highest and the most expensive Pro model, the iPhone 0:02:48.080 --> 0:02:50.720 fifteen Pro Max, is going to have additional features like 0:02:50.760 --> 0:02:53.560 a periscope camera, which essentially means it can have a 0:02:53.639 --> 0:02:57.000 much wider range of zoom using hardware, so being able 0:02:57.040 --> 0:02:59.680 to zoom in double the amount you could on the 0:02:59.720 --> 0:03:03.639 regular fifteen Pro without degrading the quality of the image. 0:03:03.840 --> 0:03:06.040 So certainly they're pushing people to the top with the 0:03:06.320 --> 0:03:09.800 better cameras, titanium and faster performance. 0:03:12.040 --> 0:03:14.519 You know, Mark, there's a big emphasis on the higher 0:03:14.639 --> 0:03:17.520 end processor for the Pro and Promax. Right a seventeen 0:03:17.600 --> 0:03:22.880 You've reported about Apple's latest generation processor additional memory, So 0:03:22.880 --> 0:03:25.560 there's a compute factor there, but there's also a battery 0:03:25.600 --> 0:03:28.560 life factor. And then, of course, not of Apple's own volition, 0:03:28.639 --> 0:03:32.080 a European Union mandate for USBC taughts us about what 0:03:32.120 --> 0:03:34.040 you've reported on those two items. 0:03:34.560 --> 0:03:36.320 Yeah, the three and nanimeter chip, this is going to 0:03:36.360 --> 0:03:38.760 be Apple's first three nanimeter component. This is a chip 0:03:38.800 --> 0:03:42.720 manufactured by TSMC, and what three nanimeter allows is better 0:03:42.760 --> 0:03:45.840 battery life and better efficiency. So you'll see some battery 0:03:45.880 --> 0:03:49.120 life upgrades on the fifteen Pro and fifteen Promacs. 0:03:49.240 --> 0:03:51.000 Because of that. And of course back. 0:03:50.840 --> 0:03:53.400 To that differentiation point, the higher end phones will get 0:03:53.400 --> 0:03:56.040 that A seventeen, whereas the lower end, the fifteen and 0:03:56.080 --> 0:03:59.000 fifteen plus the two entry level phones, those will both 0:03:59.000 --> 0:04:01.680 get the A sixteen from the fourteen Pro and fourteen 0:04:01.680 --> 0:04:05.280 Promacs from last year. And in terms of USBC, all 0:04:05.280 --> 0:04:08.840 four models will get USBC instead of Lightning. But there 0:04:08.880 --> 0:04:10.480 is a little bit of a trick here because the 0:04:10.480 --> 0:04:13.680 Pro models they're going to get USBC with faster data 0:04:13.720 --> 0:04:15.720 transfer speeds, which would be good if you take very 0:04:15.800 --> 0:04:19.000 high resolution video on the Pro models to connect them 0:04:19.040 --> 0:04:22.160 to your computer and transfer them over a cable, you'll 0:04:22.200 --> 0:04:23.920 be able to do that at a much faster rate 0:04:24.440 --> 0:04:27.200 with some specialized thunderbalk cables than you would on the 0:04:27.240 --> 0:04:30.599 regular models. So certainly the talk of today will be 0:04:30.920 --> 0:04:33.640 how the pro models are going to have extra bells 0:04:33.640 --> 0:04:36.080 and whistles to really bring people up to the higher 0:04:36.120 --> 0:04:38.599 end models. 0:04:38.640 --> 0:04:41.120 Great, so all those lightning cables I've been accruing since 0:04:41.160 --> 0:04:44.120 twenty twelve are now completely redundant, thank you to Bloomberg's 0:04:44.120 --> 0:04:46.760 Mark Gum. And We're just getting started here in Koopertino, 0:04:47.040 --> 0:04:49.919 and I'm delighted to bring in creative strategies principle analysts. 0:04:49.960 --> 0:04:53.200 Carolina Milianacy. We will get to the USBC debate. I 0:04:53.240 --> 0:04:56.480 think the big discussion we've had on Bloomberg technology has 0:04:56.520 --> 0:05:00.000 been there is an unknown number of older generation iPhone 0:05:00.120 --> 0:05:02.159 out there, if it's the tens of millions or hundreds 0:05:02.200 --> 0:05:06.040 of millions we've reported, and what we think is coming 0:05:06.520 --> 0:05:10.240 is the technology upgrade enough to spur this genuine upgrade cycle. 0:05:10.720 --> 0:05:13.320 I think it is if you know all the rumors 0:05:13.360 --> 0:05:16.520 play out. You know Mark was talking about moving people 0:05:16.560 --> 0:05:19.800 to the higher price point. I think there's two markets, right, 0:05:19.839 --> 0:05:22.720 you have the early adopters and the pro users that 0:05:22.800 --> 0:05:25.240 can do that, but then you have a huge base 0:05:25.320 --> 0:05:28.479 of people that have devices that are four or five 0:05:28.560 --> 0:05:31.799 years old that need to continue to go on that path. 0:05:31.880 --> 0:05:34.839 So creating more separation between the pro model and the 0:05:34.880 --> 0:05:37.520 non pro model is critical to get those people to 0:05:37.600 --> 0:05:38.040 move up. 0:05:38.160 --> 0:05:40.400 As you know, I focus a lot on the technology 0:05:40.400 --> 0:05:44.400 from a sort of processor compute standpoint that actually switching 0:05:44.440 --> 0:05:48.279 to titanium sides or edges is interesting. Why would that 0:05:48.320 --> 0:05:50.320 make a difference in the smartphone market? 0:05:50.520 --> 0:05:54.240 I can tell you that from just from a consumer perspective, 0:05:54.279 --> 0:05:57.600 getting into a store and holding one of those new 0:05:57.600 --> 0:06:02.680 phones is the most tangible expression of the phone being different. Right, 0:06:02.800 --> 0:06:06.200 weight on something that you use so much during the 0:06:06.279 --> 0:06:09.480 day makes a difference. It might also invite some people 0:06:09.520 --> 0:06:12.080 to go to the larger PHM factor because the weight 0:06:12.160 --> 0:06:15.760 is no longer the factor that is deciding whether or 0:06:15.760 --> 0:06:18.760 not you want to carry something that heavy. There's obviously 0:06:18.800 --> 0:06:23.839 sustainability story as well linked to titanium, and it'd be 0:06:23.880 --> 0:06:26.560 interesting to see how far Apple is going to push 0:06:26.640 --> 0:06:28.560 by a sustainability story today. 0:06:29.120 --> 0:06:33.560 Us b C did Apple wait too long? 0:06:33.680 --> 0:06:36.800 European Union mandate is the end of twenty twenty four deadline. 0:06:37.160 --> 0:06:39.640 They're going now what impact will that have. 0:06:40.880 --> 0:06:43.680 It makes it easier for people that are within the ecosystem. 0:06:43.800 --> 0:06:46.760 You know, it's one less cable. But as Mark was 0:06:46.760 --> 0:06:50.560 talking about, for the pro version, if it does do 0:06:50.680 --> 0:06:56.719 the higher data is nicer for creators rights, actually useful. 0:06:57.000 --> 0:07:01.200 It's not just about doing the mandate for for the requirement. 0:07:01.520 --> 0:07:03.880 It'd be interesting to see how they spin the story 0:07:03.960 --> 0:07:06.800 because we all been waiting, you know, and from a 0:07:06.839 --> 0:07:10.640 portfolio perspective, you know, the iPad has it, but the 0:07:10.720 --> 0:07:13.040 phone does it, and so you start to see, you know, 0:07:13.120 --> 0:07:17.360 discrepancies within the portfolio. Now we have one cable across 0:07:17.360 --> 0:07:20.280 the board. I'm sure that the AirPods will also get 0:07:20.320 --> 0:07:22.400 a new KSE with the USBC. 0:07:23.080 --> 0:07:26.360 I am all in on one cable. Carolina, tell me 0:07:26.400 --> 0:07:28.240 a little bit about how they're going to spin the 0:07:28.280 --> 0:07:30.240 green element. You just took us there a little bit, 0:07:30.280 --> 0:07:33.680 the sustainability narrative. Feel as though that's going to creep 0:07:33.680 --> 0:07:37.440 into the watches as well. 0:07:37.480 --> 0:07:40.040 It seems so with material and there's been a lot 0:07:40.080 --> 0:07:44.960 of speculation about abandoning lever, both with their own bends 0:07:45.040 --> 0:07:48.000 and with the relationship with Hermes, and I think that 0:07:48.360 --> 0:07:52.480 if you look at Apple's DNA around sustainability. They always 0:07:52.480 --> 0:07:55.480 had a very strong story. They have a goal to 0:07:55.560 --> 0:07:59.560 be carbon neutral by twenty thirty across their supply chain 0:07:59.680 --> 0:08:03.720 and products. They already carbon neutral for their own operations 0:08:03.840 --> 0:08:08.000 already today, and so it'd be interesting to see whether 0:08:08.120 --> 0:08:11.240 the material is one aspect of it. We saw the 0:08:11.320 --> 0:08:14.880 badges today are all recycled. There's no plastic in today's 0:08:14.920 --> 0:08:18.400 events badges. So it seems like sustainability is definitely going 0:08:18.480 --> 0:08:19.160 to be a story. 0:08:19.560 --> 0:08:21.960 What about the watch in general? How much are they 0:08:22.200 --> 0:08:24.960 continuing to want to innovate on that particular product. How 0:08:24.960 --> 0:08:27.080 important is it to them. 0:08:28.320 --> 0:08:31.560 It's a very important product to them, just because health 0:08:31.800 --> 0:08:35.040 and fitness is an important story to tell, and they 0:08:35.080 --> 0:08:38.400 have made a huge impact. It's been interesting to see 0:08:38.480 --> 0:08:42.960 how much the ultra version of the watch as taking 0:08:43.080 --> 0:08:47.120 consumers by storm. It's not just for the fitness when 0:08:47.200 --> 0:08:49.080 you know, we were talking about this actually on the 0:08:49.080 --> 0:08:52.600 program program and said, there's a lot of wanna bees 0:08:53.040 --> 0:08:57.400 health and fitness people that will buy this watch. So 0:08:57.480 --> 0:09:01.280 for Apple is another way too lot customers in and 0:09:01.320 --> 0:09:03.760 I know that they hate that term, but it's true. 0:09:04.320 --> 0:09:06.840 You know, if you have your phone and your watch 0:09:06.920 --> 0:09:09.720 is harder for you to move away and move to 0:09:10.240 --> 0:09:13.320 a different brand and ecosystem. 0:09:12.640 --> 0:09:15.680 Karlina, the company story for Apple has really been China. 0:09:16.040 --> 0:09:19.120 In the June quarter, it was recording greater China eight 0:09:19.160 --> 0:09:24.040 percent growth when there was overall decline. How important is 0:09:24.080 --> 0:09:27.000 this iPhone fifteen for that market? Does it get traction 0:09:27.160 --> 0:09:28.360 with the consumer in China? 0:09:28.559 --> 0:09:29.280 It's very important. 0:09:29.320 --> 0:09:31.360 And I think the story about the processor for the 0:09:31.440 --> 0:09:35.040 Maxis and the pro is important for China. China has 0:09:35.040 --> 0:09:38.439 always been a market that is more about real technology 0:09:38.559 --> 0:09:40.880 and so processors or something, but they look at very 0:09:40.880 --> 0:09:46.959 closely versus design and material. So I think that separating 0:09:47.480 --> 0:09:51.000 that pro line with a different processor, with a dedicated 0:09:51.000 --> 0:09:53.760 processor that can give you more is going to be 0:09:53.800 --> 0:09:55.199 really critical for China. 0:09:55.280 --> 0:09:58.400 Caroline and middle Lesi create a strategies principle analysts, This 0:09:58.520 --> 0:10:01.640 is a strong start, Carriac to US coverage for Bloomberg 0:10:01.679 --> 0:10:03.640 Technology to Apple's iPhone events. 0:10:12.200 --> 0:10:15.760 Let's talk about Google facing its biggest antitrust challenging yet 0:10:15.840 --> 0:10:18.840 over accusations it's maintained a monopoly over the search market 0:10:19.160 --> 0:10:22.080 via of course, those agreements with tech rivals. The company 0:10:22.120 --> 0:10:24.520 facing a pair of lawsuits by the US Justice Department 0:10:24.559 --> 0:10:27.960 and state attorneys general that could result in perhaps even 0:10:28.000 --> 0:10:30.240 the breakup of the twenty five year old search chant 0:10:30.679 --> 0:10:33.160 for more. That's bringing Jennifer and Wee Bloomberg Intelligence senior 0:10:33.200 --> 0:10:37.080 litigation analyst who's been listening in already some opening statements. 0:10:38.120 --> 0:10:40.160 Does this feel reminiscent to the nineties? 0:10:40.880 --> 0:10:41.040 You know? 0:10:41.200 --> 0:10:41.640 It does? 0:10:41.840 --> 0:10:42.480 It really does. 0:10:42.520 --> 0:10:44.760 And there's so many parallels being brought to the big, 0:10:44.840 --> 0:10:47.480 huge case against Microsoft that I think we all know about. 0:10:47.800 --> 0:10:49.880 And the thing is it is similar. You know, there 0:10:49.920 --> 0:10:53.560 are allegations, you know, Microsoft was entering into agreements to 0:10:53.559 --> 0:10:56.760 try to block out Netscape and Java, and the allegation 0:10:56.880 --> 0:10:59.360 here is that Google's entering agreements to try to block 0:10:59.400 --> 0:11:03.040 out Bright like being in duc, dot Go other companies 0:11:03.040 --> 0:11:05.560 that people would use to search the Internet. Right, So 0:11:05.800 --> 0:11:07.640 there are a lot of similarities there, but there are 0:11:07.640 --> 0:11:10.400 also some very big differences because of what these tech 0:11:10.440 --> 0:11:12.520 companies have learned from the Microsoft case. 0:11:12.880 --> 0:11:15.679 And to that end, the argument's going to be coming 0:11:15.720 --> 0:11:18.720 from Alphabet, the parent company of Google. Are they in 0:11:18.760 --> 0:11:20.800 any way going to diverge from basically what we learned 0:11:20.800 --> 0:11:22.640 to the nineteenth Yeah? I think so. 0:11:22.800 --> 0:11:25.160 Look, they're going to say we've done nothing to prevent 0:11:25.240 --> 0:11:27.480 anybody from using being or duc dot Go to search 0:11:27.520 --> 0:11:30.440 the internet. You know, in Microsoft's case, it made it 0:11:30.640 --> 0:11:34.240 very difficult for anybody using a Microsoft PC to download 0:11:34.240 --> 0:11:37.240 and use Netscape right as a browser. They technically made 0:11:37.240 --> 0:11:39.959 it difficult, you could not do it. But in this case, 0:11:40.040 --> 0:11:43.400 actually it's quite easy to change your default search engine. 0:11:43.440 --> 0:11:46.559 Google may have that agreement to start as the default 0:11:46.559 --> 0:11:48.560 when you buy your device, but you can go in 0:11:48.600 --> 0:11:52.400 and change your device. So it's questionable as to whether 0:11:52.559 --> 0:11:55.520 is this really foreclosing Google competitors or isn't it And 0:11:55.559 --> 0:11:57.800 so we're going to have to see how that testimony 0:11:57.840 --> 0:12:00.280 comes out about how sticky it is to be the default, 0:12:00.480 --> 0:12:02.560 how much users actually do switch back and. 0:12:02.559 --> 0:12:04.440 Forth, And isn't it interesting that's coming all at this 0:12:04.480 --> 0:12:07.640 moment where we're suddenly thinking the monopoli is under attack 0:12:07.720 --> 0:12:10.800 from chat GPT four, the idea that AI is really 0:12:10.920 --> 0:12:12.199 it's the competitor of choice now. 0:12:12.400 --> 0:12:12.560 You know. 0:12:12.640 --> 0:12:15.600 The interesting thing about technology is that the markets can 0:12:15.720 --> 0:12:19.080 change so quickly and so drastically, you know, And this 0:12:19.200 --> 0:12:20.760 is one of the things that all the tech companies 0:12:20.760 --> 0:12:22.920 will claim. Look, I may have a monopoly now, but 0:12:23.040 --> 0:12:25.240 this could change any day. And we're always trying to 0:12:25.240 --> 0:12:29.000 hold onto our position and technology changes and you really 0:12:29.040 --> 0:12:31.720 can't judge it sort of the way the antitrust laws 0:12:31.720 --> 0:12:33.000 are judging it right now. 0:12:33.240 --> 0:12:35.520 You know, you have to think about chat GBT. 0:12:35.840 --> 0:12:38.480 I tend to think chat gbt is a bigger threat 0:12:38.480 --> 0:12:41.400 to Google, actually Google Search than this particular trial. 0:12:42.280 --> 0:12:44.800 Interesting, Jenniferry, We're so pleased to have her hair from 0:12:44.800 --> 0:12:47.439 Blue Meg Intelligence, and we want to dig into the 0:12:47.520 --> 0:12:50.040 legal ramifications a little bit more, the arguments being set 0:12:50.080 --> 0:12:52.920 forth for Rebecca Allen'sworth, professor of Law. I've write, Vanderbilt, 0:12:52.920 --> 0:12:56.160 it is wonderful to have your perspective hair, Rebecca. And 0:12:56.320 --> 0:12:59.160 the track record thus far of the government in the 0:12:59.160 --> 0:13:01.960 antitrust case is it ain't been good? I mean, are 0:13:01.960 --> 0:13:04.240 embracing yourself that perhaps they could land this one. 0:13:05.520 --> 0:13:08.240 Well, all antitrust trials are really hard to win, and 0:13:08.280 --> 0:13:11.480 this is no different. The government's arguments are good, and 0:13:11.920 --> 0:13:13.480 I think that if they have a chance of winning 0:13:13.480 --> 0:13:15.240 in any case, they have a chance of winning in 0:13:15.280 --> 0:13:17.880 this one. I do take issue with the idea that 0:13:17.960 --> 0:13:20.520 their track record has been bad. It's true that they've 0:13:20.559 --> 0:13:22.920 lost a lot of cases in terms of the final outcome. 0:13:23.360 --> 0:13:25.800 But along the way there have been some important holdings 0:13:25.800 --> 0:13:29.200 that I think actually vindicate the current enforcement attitude that 0:13:29.240 --> 0:13:30.920 the FTC and the dj is taking. 0:13:31.440 --> 0:13:33.960 Let's dwell on that a little bit, because this isn't 0:13:34.000 --> 0:13:37.199 just about winning individual fights, but it's about sort of 0:13:37.240 --> 0:13:41.360 changing the narrative the leaning of how future FTCs as 0:13:41.360 --> 0:13:45.480 well and future administrations might just tackle big tech. Do 0:13:45.520 --> 0:13:46.840 you think that has changed? 0:13:47.800 --> 0:13:48.600 I think it has. 0:13:48.760 --> 0:13:50.920 I mean, there's a case from about fifteen years ago 0:13:51.080 --> 0:13:54.200 actually involving Google, in which the court said that there 0:13:54.280 --> 0:13:57.959 cannot be any antitrust harm in a market for which 0:13:58.080 --> 0:14:00.840 consumers don't pay for the product, and that is not 0:14:01.800 --> 0:14:03.760 likely to be the holding in this case because we've 0:14:03.800 --> 0:14:07.880 realized that free products aren't really so free. So that's 0:14:07.920 --> 0:14:12.160 just one example of how yes, it's it's it's changed 0:14:12.200 --> 0:14:13.920 over time in. 0:14:13.960 --> 0:14:17.960 Terms of the technicalities of this particular case. How do 0:14:18.000 --> 0:14:21.040 you think the arguments will land thus far? When you're 0:14:21.080 --> 0:14:24.280 hearing of the ten million being paid by Google to 0:14:24.400 --> 0:14:29.360 maintain basically key relationships with phonemakers, how do you think 0:14:29.440 --> 0:14:31.880 the alternatives are going to land coming from Google? 0:14:33.360 --> 0:14:36.320 Well, I think that they have some strong arguments too, honestly. 0:14:36.520 --> 0:14:38.120 So they're going to argue two things. 0:14:38.160 --> 0:14:41.280 They're going to say, first of all, we are big 0:14:41.640 --> 0:14:45.760 not because we have these exclusive dealing contracts, but we're 0:14:45.760 --> 0:14:49.000 big because we were better. Consumers have voted. That's what 0:14:49.080 --> 0:14:51.680 competition is supposed to do, and we won. We're the 0:14:51.720 --> 0:14:54.240 best search engine. They're also going to say that these 0:14:54.240 --> 0:14:57.560 are not actually exclusive dealing contracts. Competition is just a 0:14:57.640 --> 0:15:00.560 click away. This, I think is a less strong argument, 0:15:00.640 --> 0:15:03.120 and I do think this is a lot like the 0:15:03.240 --> 0:15:07.360 argument made in the Microsoft case, but kind of put together, 0:15:07.720 --> 0:15:11.160 there is an intuition that, you know, consumers really like Google. 0:15:11.280 --> 0:15:14.000 They're not downloading bing and Duck Duck go to their phones, 0:15:14.280 --> 0:15:16.880 and that's competition, so that will be hard to overcome 0:15:16.920 --> 0:15:17.520 for the government. 0:15:17.720 --> 0:15:20.040 We're looking at year to date chart of Alphabet shares 0:15:20.120 --> 0:15:22.480 right now about fifty four percent. It doesn't feel as 0:15:22.520 --> 0:15:25.640 though the investor and analyst community are particularly fretting over 0:15:25.680 --> 0:15:28.440 some sort of big breakup or impact to the overall 0:15:28.480 --> 0:15:32.080 revenue streams of this business. That's largely about where artificial 0:15:32.120 --> 0:15:34.400 intelligence takes us. But for the here and the NARRABECKA, 0:15:34.520 --> 0:15:36.960 do you think that some sort of risk does need 0:15:37.040 --> 0:15:39.040 to be factored in how do you think that people 0:15:39.040 --> 0:15:40.000 are bracing themselves. 0:15:40.720 --> 0:15:43.000 So I think as far as the market risk, I 0:15:43.040 --> 0:15:46.520 don't know that this trial poses a huge risk to 0:15:46.560 --> 0:15:49.720 Google's bottom line. And that's for a few different reasons. 0:15:49.720 --> 0:15:51.480 First of all, I think that they're more likely than 0:15:51.520 --> 0:15:53.640 not to win. I think that maybe speaks to the 0:15:53.640 --> 0:15:55.160 weakness of our antitrust laws. 0:15:55.480 --> 0:15:57.280 But the other thing is Google. 0:15:56.960 --> 0:15:59.360 Is big, and Google is dominant for reasons other than 0:15:59.440 --> 0:16:03.040 these exclusive of dealing contracts. I think a breakup is unlikely. 0:16:03.200 --> 0:16:05.120 I think even if the government wins, what they're going 0:16:05.160 --> 0:16:07.800 to get is an injunction against these contracts, and it's 0:16:07.800 --> 0:16:10.440 a small piece of why Google is so dominant. I 0:16:10.440 --> 0:16:13.160 think this trial matters more for precedent and for anti 0:16:13.200 --> 0:16:15.480 trust law and for what it means for the rest 0:16:15.520 --> 0:16:15.960 of tech. 0:16:16.600 --> 0:16:18.760 Rebecca, really great to get your expertise. We thank you 0:16:18.840 --> 0:16:21.600 so much. Rebecca Alla's were founderment law school professor. This 0:16:21.640 --> 0:16:23.040 one's going to roll on, so I have a feeling 0:16:23.080 --> 0:16:26.200 we'll be inviting her back. Meanwhile, coming up, Cage Matches, 0:16:26.520 --> 0:16:28.720 they've become part of a technology show much more than 0:16:28.760 --> 0:16:31.200 I ever envisioned. But let's have a look at WW 0:16:31.360 --> 0:16:34.440 and the UFC today combining as a public entity training 0:16:34.480 --> 0:16:36.600 on the New York Stock Exchange. I'm going to be 0:16:36.640 --> 0:16:39.880 discussing law within deva COO Mark Shapiro. That's next. This 0:16:39.960 --> 0:16:56.720 is blouly bout technology time now for talking tech. First up, 0:16:57.080 --> 0:16:59.320 arm preparing for the biggest IPO of the year, and 0:16:59.320 --> 0:17:01.880 its CEO is pitching investors a little bit of a pivot. 0:17:02.080 --> 0:17:04.960 Instead of focusing on chips for smartphones and other electronics 0:17:04.960 --> 0:17:08.520 that sell for pennies, Army is doing complex design work, 0:17:08.520 --> 0:17:11.000 it says, folks on specific products tailored for what sees 0:17:11.320 --> 0:17:14.560 as a key area of growth, of course, largely being AI. Currently, 0:17:14.600 --> 0:17:18.560 its listing is oversubscribed by ten times plus. Ali Baba 0:17:18.680 --> 0:17:21.400 will put artificial intelligence and user experience at the top 0:17:21.440 --> 0:17:24.600 of its priorities as its new leadership seeks to reclaim 0:17:24.640 --> 0:17:27.560 customers and indeed market share. CEO Eddi Wu laid out 0:17:27.560 --> 0:17:30.040 his vision in a memo to staff, stressing its approach 0:17:30.119 --> 0:17:32.760 to go AI first, while not forgetting the one hundreds 0:17:32.800 --> 0:17:35.159 of millions of users that helped create one of China's 0:17:35.240 --> 0:17:39.240 largest corporations. And senators here in America will question the 0:17:39.320 --> 0:17:42.840 nation's top technology leaders as Congress confronts thus posed by 0:17:42.880 --> 0:17:45.520 what they see as a rapid rise of artificial intelligence. Tomorrow, 0:17:45.680 --> 0:17:47.959 it's going to be a closed door inaugural AI forum. 0:17:48.080 --> 0:17:50.800 You're going to see these two gentlemen, Elon Musk, Mark Zuckerberg, 0:17:50.800 --> 0:17:52.920 also so of Pitchee and others who are going to 0:17:52.920 --> 0:17:57.800 be attending to ask questions and concerns of the burgeoning technology. Meanwhile, 0:17:58.400 --> 0:18:01.439 talking of those two individuals and Musk, remember we were 0:18:01.440 --> 0:18:05.640 all talking about cage matches. Well, we're talking also fighting 0:18:05.680 --> 0:18:08.120 more broadly, the billions of money it brings in Endeavor 0:18:08.160 --> 0:18:11.639 today completing its takeover ww and combining it with UFC 0:18:11.800 --> 0:18:15.680 to create a publicly traded fighting machine called TKO. That's 0:18:15.800 --> 0:18:19.400 technical knockout being the boxing term. Now, earlier I discussed 0:18:19.400 --> 0:18:22.560 the news with Endeavor and now TKO's COO and president, 0:18:22.600 --> 0:18:25.160 that's Mark Shapiro, and this is what he talked about 0:18:25.200 --> 0:18:26.360 in terms of competition taking. 0:18:26.160 --> 0:18:31.960 Listen, the market completely overreacted last week because ultimately piff 0:18:31.960 --> 0:18:33.400 came out said they were going to make one hundred 0:18:33.400 --> 0:18:34.680 million dollar investment. 0:18:34.320 --> 0:18:35.800 In the PFL. And you know what, We're fans of 0:18:35.840 --> 0:18:36.320 the BFL. 0:18:36.680 --> 0:18:41.240 We're fans of any entity that supports MMA for the UFC. 0:18:42.280 --> 0:18:45.359 Rising tide lifts all boats on this front, and the 0:18:45.480 --> 0:18:47.399 UFC is where everybody wants to get to. I mean, 0:18:47.560 --> 0:18:51.320 the UFC is really the NFL of combat sports. So 0:18:52.080 --> 0:18:55.760 when we welcome it, I think the overreaction was really. 0:18:55.640 --> 0:18:56.600 About fighter pay. 0:18:56.800 --> 0:18:59.240 If there's more and more competition and there's more and 0:18:59.240 --> 0:19:01.840 more brands coming to the table, is fighter pagan to 0:19:01.840 --> 0:19:03.760 get out of control and hurt UFC's margins. 0:19:03.800 --> 0:19:05.600 And it couldn't be farther from the truth. 0:19:05.440 --> 0:19:09.080 Because the real growth of UFC, the revenue growth, has 0:19:09.119 --> 0:19:12.159 been driven by high margin revenue streams such as our 0:19:12.200 --> 0:19:15.520 media deals and sponsorships, and at the end of the day, 0:19:16.240 --> 0:19:20.200 any fighter pay increase can be absorbed by the increases 0:19:20.240 --> 0:19:23.439 we're seeing in those revenue streams and results still in 0:19:23.520 --> 0:19:24.240 margin accretion. 0:19:24.680 --> 0:19:26.400 Let's talk about the board that of course, he said 0:19:26.400 --> 0:19:28.520 that you're going to be controlling, but there's a bit 0:19:28.560 --> 0:19:33.080 of a key man risk with being McMahon himself ofwe 0:19:33.240 --> 0:19:36.199 how do you see that and his real dedication as 0:19:36.240 --> 0:19:38.080 executive chair to the overall TKO. 0:19:38.320 --> 0:19:40.679 He's very similar to Dana White. I mean, Vince McMahon 0:19:40.760 --> 0:19:42.280 is very similar. He's a founder. 0:19:42.520 --> 0:19:46.320 He's a pioneer, he's an innovator, he's a hard charger, 0:19:46.920 --> 0:19:50.400 he's got unbelievable relationships, and he's grown this sport from 0:19:50.400 --> 0:19:53.359 nothing to be the global behemoth that it is. So 0:19:53.720 --> 0:19:56.719 I welcome him being executive chairman. Ari and I are 0:19:56.880 --> 0:19:59.280 very excited a partner with him. And just in the 0:19:59.320 --> 0:20:01.440 early days we haven't been able to kind of get 0:20:01.480 --> 0:20:05.280 in there and really integrate. We've already seen a willingness 0:20:05.280 --> 0:20:10.680 to do that. Terrific communication, terrific collaboration, and I think 0:20:10.760 --> 0:20:14.960 Vince really recognizes the areas of business he has undermonetized 0:20:15.080 --> 0:20:17.959 or his team is undermonetized. And that's why the merger, 0:20:18.040 --> 0:20:21.200 the partnership here, because we can teach them something, meaning 0:20:21.280 --> 0:20:24.679 UFC an endeavor and WW can surely teach us something. 0:20:24.880 --> 0:20:26.239