Speaker 1: And Caroline hired at Bloomberg's world headquarters in New York
Speaker 1: and Imed Ludlow in San Francisco. This is Bloomberg Technology
Speaker 1: coming up. Tens of thousands more tech employees are out
Speaker 1: of a job after Microsoft and Amazon start downsize today
Speaker 1: as employers reduced headcount. Is the pandemics moment of worker empowerment?
Speaker 1: Over and universities in Texas are taking action against TikTok,
Speaker 1: with Texas A and M and Texas University reportedly blocking
Speaker 1: the app from its WiFi networks as part of the
Speaker 1: governor's orders. Could this be the start of a greater trend?
Speaker 1: And do you want one of Twitter's officers neon signs
Speaker 1: or a white board or a giant refrigerator. Twitter has
Speaker 1: resorted to auctioning office items will show you what was
Speaker 1: up for grabs. But first we want to talk about
Speaker 1: one of the key issues that off sometimes bring, certainly
Speaker 1: for plenty of chief technology and chief security officers, because
Speaker 1: there are security concerns around all of this. Disgruntled workers
Speaker 1: for examples, maybe they take corporate secrets with them when
Speaker 1: they get laid off, or maybe they get a bit
Speaker 1: careless about them. Margie Murphy has a great story on
Speaker 1: all of this, and just tell us a little bit, Margy,
Speaker 1: about how companies are starting to prepare themselves as they
Speaker 1: know they're going to make layoffs. How do they ensure
Speaker 1: that the data that they have remained secure. Yeah, it's
Speaker 1: a real problem because around the time that layoffs are happening,
Speaker 1: obviously everyone's trying to tighten their belt, and that's when
Speaker 1: security budgets might be cut a little bit. But companies
Speaker 1: are looking at things like new software that's around to
Speaker 1: track whether employees are are using data exfiltration methods um.
Speaker 1: And they're also trying really hard to just give out
Speaker 1: the messaging and reminding people that things that they're working
Speaker 1: on belong to the company, not to themselves. Um I
Speaker 1: mentioned data exfiltration, and that's when people toward emails to
Speaker 1: their personal accounts or maybe a copy and paste of
Speaker 1: spreadsheet with contact details or client contracts, and that puts
Speaker 1: companies at risk of obviously losing business if that person
Speaker 1: takes that with them to another company, but also regulatory
Speaker 1: and confidentiality issues as well, Margie, we we've got to
Speaker 1: ask ourselves why we're discussing this story. Fantastic work in
Speaker 1: business Week magazine and an analysis of what happens when
Speaker 1: we hear about jobs being cut layoffs in the technology
Speaker 1: industry to the tunes of thousands, the kind of the
Speaker 1: anecdote that you guys uses coin based right when it
Speaker 1: announced its layoffs and Brian or Armstrong basically explaining that
Speaker 1: by the end of the day, UH employees would receive
Speaker 1: notifications their personal email addresses, and it was very abrupt
Speaker 1: and he said, look, we kind of have to do
Speaker 1: this because our customer information is key. We have to
Speaker 1: protect that customer data. What kind of serious steps have
Speaker 1: you report it on that companies are taking to kind
Speaker 1: of safeguard themselves and their customers when they go through
Speaker 1: a random lyoffside this. Well, yeah, as you mentioned the
Speaker 1: case with coin base, it was, you know, employees were
Speaker 1: waking up to already having their email shut off, which
Speaker 1: sounds incredibly callous and was criticized, you know for kind
Speaker 1: of having lacking that personal touch to realize that you've
Speaker 1: been completely wiped from a company. But more and more
Speaker 1: companies are having to do this because the risk is
Speaker 1: just so high. It's so easy for employees to just
Speaker 1: simply forward an email, you know, they if they've got
Speaker 1: a few hours left, they'll just be kind of sending
Speaker 1: stuff to to their own personal gmails and not. You know,
Speaker 1: you've got some people who are obviously irritated that they're
Speaker 1: fired and maybe want to do something really kind of
Speaker 1: bad with that and leak it. But often people don't
Speaker 1: even realize that what they're doing is it is against
Speaker 1: their employment contract, and they simply want to kind of
Speaker 1: better themselves and then next employment because they're scared they've
Speaker 1: they've just been let go. Um. But largely we're seeing
Speaker 1: companies just really cracked down and shut down from the
Speaker 1: minute people are being laid off and being very very cold,
Speaker 1: I guess, but but extremely secure just because the risks
Speaker 1: are so high. We've seen issues with coin Base, um,
Speaker 1: you know, it had that an employee was accused of
Speaker 1: insider trading because they were sharing some information. That was
Speaker 1: the famous case with Waymo, which was Google's driverless car
Speaker 1: arm Anthony Levandarsky he famously went to ub was defected
Speaker 1: and he took company's secrets with him and it was
Speaker 1: an extremely long court case and had serious ramiflications for Google.
Speaker 1: So the stakes are really really high, alright, Bloomberg Margie
Speaker 1: Murphy just terrific reporting on air and also in business.
Speaker 1: We check out that story on Bloomberg dot com. Now,
Speaker 1: as we've been discussing, Amazon and Microsoft are laying off
Speaker 1: some of their work force. This is part of a
Speaker 1: wider wave of job cuts that are hitting the tech
Speaker 1: industry right now, already facing of course, the chance of
Speaker 1: recession globally. Here's what some of our guests across Bloomberg
Speaker 1: Television have been talking about. We've not been positive on
Speaker 1: Big Deck for I don't know a year, a year
Speaker 1: and a half. We do believe that there is still
Speaker 1: some deflation to come out of this market after the
Speaker 1: exuberence of twenty one. I actually think that the tech
Speaker 1: sector is one of the few sectors that is really
Speaker 1: discounting a recession in its outlook. The longer the macro
Speaker 1: volatility persists, we do expect early stage and seed to
Speaker 1: start to see that crunch that the late stages is
Speaker 1: seen right now, and there is going to be some
Speaker 1: amount of normalization of the demand. Uh. Quite frankly, we
Speaker 1: in the tech industry will also have to get efficient, right.
Speaker 1: It's not about everyone else doing more with less. We
Speaker 1: will have to do more with less. All right, So
Speaker 1: let's bring in Bloomberg's Austin car who has been writing
Speaker 1: about why behind the job cuts, and you heard their
Speaker 1: auster and from a rural range of names across venture
Speaker 1: capital public markets also sat in Adela on why we're
Speaker 1: seeing these layoffs in the technology industry. Rapp all of
Speaker 1: this together, because you've been writing about this also in
Speaker 1: Business Week. So what we saw over the last year
Speaker 1: or two was just as one of those analysts had
Speaker 1: noticed at this exuberance coming out of the COVID nineteen pandemic,
Speaker 1: where the tech sector, more than any other industry, had
Speaker 1: really bet big on this new revenue acceleration being permanent.
Speaker 1: And we've seen that course correction happened quite harshly in
Speaker 1: more recent days and months, with Amazon and Microsoft announcing
Speaker 1: sort of headline grabbing uh layoffs in the you know,
Speaker 1: ten eighteen thousand range figures. And what's totally remarkable about
Speaker 1: that is how it compares to the rest of the
Speaker 1: US economy. Job cuts in two were actually up and
Speaker 1: the tech sector six compared to the previous year, whereas
Speaker 1: in the rest of the economy was only the layoffs
Speaker 1: we're only up. So what you saw is all these
Speaker 1: tech companies betting huge on that COVID error growth remaining
Speaker 1: and and being a much longer term phenomenon, and we're
Speaker 1: now seeing a sort of big course correction from other
Speaker 1: big tech companies, and only is trying to understand firstly
Speaker 1: whether it's a bell weather, but also also why it's
Speaker 1: not really showing up in the big data at the moment.
Speaker 1: Many hypothesize that these people are highly talented, highly skilled,
Speaker 1: and people still want them in the other industries, so
Speaker 1: they're snapped up very quickly rather than showing up in
Speaker 1: the BLS data for example. But go to also where
Speaker 1: they might add jobs, because I thought that was interesting
Speaker 1: from SATI in a data and Amazon and Microsoft at large,
Speaker 1: they are still going to be hiring in some spaces, right, Well,
Speaker 1: that's the narrative that they sold Walter on this sort
Speaker 1: of high growth, higher risk, big return investments. So they
Speaker 1: can't just stop all of those moonshots that they've been
Speaker 1: investing in for the last couple of years and let
Speaker 1: go of that very high caliber, expensive engineering talent. So
Speaker 1: you're seeing sort of this balance between tech companies trying
Speaker 1: to give off some signal that they're going to be
Speaker 1: a little bit more financially prudent and conservative while not
Speaker 1: giving up on some of those longer term bets. With Microsoft,
Speaker 1: for example, such an Adela saying we're going to double
Speaker 1: down in core businesses, but we're going to continue to
Speaker 1: invest in high growth areas like AI or with Amazon,
Speaker 1: they're seeing layoffs happen in the retail division or in
Speaker 1: some of their devices, sort of the risky or hardware
Speaker 1: bets that they've been making with Alexa Advices. But at
Speaker 1: the same time he's also saying Andy Jassy, the CEO,
Speaker 1: has said we're still going to invest in high growth
Speaker 1: areas like groceries or B two B services, third part
Speaker 1: of party seller markets, So they're really trying to sort
Speaker 1: of balance that that sort of risk and reward. Right now,
Speaker 1: I want to bring up this terminal chart again which
Speaker 1: we showed earlier in the show. Um Amazon's total global
Speaker 1: head count, right so eighteen thousand jobs. It's it's a
Speaker 1: striking headline, but it's one percent of its global workforce.
Speaker 1: And I think there's discussion about this from market participants
Speaker 1: in our in our reporting, right Austin, what does that
Speaker 1: what does that tell us the difference between the headlines
Speaker 1: and the reality and how this period, this economy of
Speaker 1: three might be different to the dot com bubble, even
Speaker 1: the two thousand and eight financial crisis. Yeah, it indicates
Speaker 1: so far that just given how wired big tech is
Speaker 1: into the rest of the global economy, it's a lot
Speaker 1: different than it was during the dot com crash two
Speaker 1: decades ago. Uh. You know, all these companies around the
Speaker 1: world are much more dependent on Silicon Valley software, their hardware,
Speaker 1: their chips, their cloud computing services, their enterprise services as well.
Speaker 1: So it's not the case that as much as these
Speaker 1: headline grabbing numbers are are pretty massive, there's still a
Speaker 1: small percentage of of Amazon's overall workforce, or for Microsoft,
Speaker 1: the ten thousand cuts that they announced, that's I think
Speaker 1: only five percent of their overall workforce. So it's a
Speaker 1: lot smaller. Uh. And it's also in specific areas, at
Speaker 1: least from our sources we're hearing from HR and recruiting
Speaker 1: rather than some of the high, high caliber, expensive talent
Speaker 1: and engineering. They're sort of can double down for their
Speaker 1: core businesses that they want to continue invest in. But
Speaker 1: again it's always that balance. With Mark zucker Burke, he said,
Speaker 1: you know what, we're still going to invest more. We're
Speaker 1: going to reprioritize our adversis, but we're still going to
Speaker 1: make that that bet in engineering talent, our metaverse, which
Speaker 1: is that longer term bet that they're they're making. It's nuanced,
Speaker 1: and you do it so well for us, Austin, thank
Speaker 1: you very much. Indeed, Austin car it's a great read. Meanwhile,
Speaker 1: we'll one sector in technology that's really been letting go
Speaker 1: of a lot of staff is crypto, and in fact,
Speaker 1: crypto firm Genesis is one of those, and it's also
Speaker 1: said it's preparing now we understand for bankruptcy filing as
Speaker 1: early as this week. They're lending unit of Barry Silbert's
Speaker 1: Digital Currency Group. Genesis is in confidential negotiations with various
Speaker 1: creditor groups amid a liquidity crunch. Genesis suspended withdrawals in November,
Speaker 1: soon after ft X men bankrupt course. On Tuesday, Digital
Speaker 1: Currency Group told shareholders that it's suspending quarterly dividends in
Speaker 1: an effort to conserve cash. Coming up, Well, now, what
Speaker 1: access to TikTok at universities in Texas? What impact could
Speaker 1: that ban have? We'll discuss this Blue beg I think
Speaker 1: the national security issue of our time is the technology
Speaker 1: competition with China. We've already seen that around things like
Speaker 1: five G Semiconductors were now looking at issues like new
Speaker 1: energy and synthetic biology because in China we have a
Speaker 1: competitor that's investing at a rate that's commensurate with what
Speaker 1: we're investing. And uh, I'm all for innovation, but I've
Speaker 1: been particularly concerned about TikTok. My fears one TikTok collects
Speaker 1: more information about you as a user than virtually any
Speaker 1: other site around your keystrokes, your facial expressions, and I'm
Speaker 1: horribly afraid that that's being stored somewhere in besion. I'm
Speaker 1: also concerned about it being an ability to manipulate um
Speaker 1: the flow of information to you. I was Senator Mark
Speaker 1: Warner that and look, speaking of TikTok, some universities in Texas,
Speaker 1: like the University of North Texas among others, there are
Speaker 1: said to be blocking access to the video sharing app
Speaker 1: TikTok on its WiFi and wide networks to comply with
Speaker 1: quote Governor Abbot's directive to all state agencies banning employees
Speaker 1: from using or downloading TikTok on all state issued or
Speaker 1: managed devices and environments. That's according to a statement shared
Speaker 1: with Bloomberg. Now, Rumberg's Alex Brinka is here to break
Speaker 1: it all down. And what's so interesting to me, Alex
Speaker 1: is basically the university's front running the rest of the state. Oh,
Speaker 1: I think we've got a technical glitch. We're gonna be
Speaker 1: getting to Alex in a moment. Who's out in l A.
Speaker 1: But ed, first, let's bring in what our audience said,
Speaker 1: because yes, it seems as though we're seeing a front
Speaker 1: running in certain institutions in a state versus the state
Speaker 1: itself and states themselves front running the federal government. But
Speaker 1: we are sked ultimately our audience as to whether this
Speaker 1: is going to make any difference. And well, many seem
Speaker 1: to think VPNs are going to come to the rescue
Speaker 1: in some way. Yeah. Look, there's two sides to this debate.
Speaker 1: Right in Texas, what you see is university is essentially
Speaker 1: public entities enacting the directive from the governor and putting
Speaker 1: that into practice. And that manifests itself by the universities
Speaker 1: not allowing students or anyone on campus to access the
Speaker 1: TikTok app through the WiFi network. Well, they can probably
Speaker 1: still access if they turn off WiFi and use their
Speaker 1: five G network. But it's it's the debate around who
Speaker 1: should be acting on this, because the buying administration and
Speaker 1: the federal government have been leading a security view of
Speaker 1: TikTok and other cyber screty threats for some time. And
Speaker 1: there's the answer, right Carol. For the eight percent of
Speaker 1: the respondents we polled said this isn't going to fix
Speaker 1: anything bank the specifics of not allowing TikTok access on
Speaker 1: campus in Texas universities. But they are following through in
Speaker 1: the governor's directive. They are, And let's get to Alex. Now,
Speaker 1: I think technology issues solved on this technology show. Tell
Speaker 1: us Alex about whether you're surprised that some of these
Speaker 1: institutions are going headlong into these sorts of bands. It
Speaker 1: is a little interesting how they're interpreting this right. They
Speaker 1: actually University of Texas at Austin, for example, doesn't have
Speaker 1: a specific directive to move forward in this um. In
Speaker 1: this way, Texas Tech is waiting until they get more
Speaker 1: guidance from the state. So it's interesting to see Texas, Georgia,
Speaker 1: Alabama really being front footed here. And following along what
Speaker 1: we heard at the top from Senator Warner basically saying,
Speaker 1: we're worried about data sharing on TikTok and potential data
Speaker 1: sharing with the Chinese government, and we're going to lock
Speaker 1: this down now. Ed what you said, um about students
Speaker 1: potentially looking for workarounds accessing TikTok on their cellular data
Speaker 1: and not on the WiFi words band, That's exactly what's happening.
Speaker 1: I've been chatting to folks who are on the ground
Speaker 1: at u T Austin in particular, who have said, look,
Speaker 1: we have other ways we're gonna access this app. I
Speaker 1: use it for entertainment, I use it for educational content.
Speaker 1: So they're on TikTok anyways, even if it's not on
Speaker 1: the WiFi at the university. Yeah. Quite. I think it's
Speaker 1: also an educational issue, right understanding why is this a
Speaker 1: security skin and conveying that to uses of all social
Speaker 1: media platforms. That seems to be what we're hearing from
Speaker 1: users of that particular platform. Bloombergs, Alex Barrinka, thank you
Speaker 1: very much. Now. Cisco CEO Chuck Robbins spoke to Bloombergs,
Speaker 1: David Weston and Davos about tech layoffs, the impact of
Speaker 1: COVID nineteen on the tech sector, but first about their
Speaker 1: investment into software. Have a listen. Well, there's a few
Speaker 1: things we've done. We've added a lot of our cybersecurity
Speaker 1: technology is just pure software, right, I mean, that's just
Speaker 1: the nature of the industry and how we're defending against threats.
Speaker 1: Collaboration is a lot of software. Our web ex portfolio
Speaker 1: and the meeting capability, so those are just natural software
Speaker 1: products that we then also begun to sell subscriptions on
Speaker 1: our hardware platforms, and that's been a transition we started
Speaker 1: back in two thousand, seventeen or eighteen and uh last quarter,
Speaker 1: recurring revenue including software and services represented our business, which
Speaker 1: is significantly different than where we were five, six, seven
Speaker 1: years ago. You mentioned earlier the pandemic and what that did. Intact,
Speaker 1: I didn't change your business, and maybe over the longer term,
Speaker 1: maybe not just over the short term, but we're their
Speaker 1: fundamental shifts in the use of technology that fect Cisco. Well,
Speaker 1: I think it became clear. I really believe that prior
Speaker 1: to the pandemic, every executive believed technology was strategic. Right.
Speaker 1: We've a decade or fifteen years ago, we moved from
Speaker 1: it being an operational productivity driver to really being a
Speaker 1: strategic enabler and a strategic differentiator for our customers. During
Speaker 1: the pandemic, it just elevated. I mean everyone's eyes were
Speaker 1: open as to I mean, we kept the world running
Speaker 1: when everyone was at home, We kept everyone productive, and
Speaker 1: I think no one believed that was possible, including a
Speaker 1: lot of people in tech, and uh, we've never tried
Speaker 1: it before, so doing it at that scale, and I
Speaker 1: think what that did is it gave So I think
Speaker 1: it gave our customers this incredible confidence and investing in
Speaker 1: technology and listening to their teams who are bringing them
Speaker 1: these new, crazy creative projects around what they want to
Speaker 1: do with technology, and they go, well, I've seen this,
Speaker 1: I've seen it work here, so I'm gonna trust you
Speaker 1: and believe you. So I think that's one piece of it.
Speaker 1: And I think from a cultural perspective, I think every
Speaker 1: company's culture was magnified during the pandemic, and I think
Speaker 1: that we'll never go back to the way we were.
Speaker 1: I think, uh, we're gonna operate in environments where employees
Speaker 1: want to have human, authentic conversations, just like we did
Speaker 1: over video while everybody was at home, and so I
Speaker 1: think it changed how we engage with our employees as well.
Speaker 1: Tell you what new crazy creative projects in teach. There's
Speaker 1: a lot of talk around here about open AI, artificial
Speaker 1: intelligence and by the way, quantum computing. I'm not sure
Speaker 1: exactly what those mean, but there's a lot of talk
Speaker 1: about them. Is that going to fundamentally change your business? Well,
Speaker 1: it's we're working on quantum networking today because when you
Speaker 1: have big networks of quantum computers, you have to be
Speaker 1: able to connect them and actually move the bits at
Speaker 1: at rates that are commensurate with the speed of the computers.
Speaker 1: So there's a lot of research that we're engaged in
Speaker 1: right now. So we're in the early days. We have
Speaker 1: team of people doing research on quantum networking, so absolutely
Speaker 1: that will be a part of our business. And then
Speaker 1: these open AI and things like chat, GPT, and then
Speaker 1: that's something that I actually had a conversation with my
Speaker 1: team about and I think it's it's amazing how fast
Speaker 1: it went from sort of being exposed to all of
Speaker 1: a sudden My guess is my next board meeting, we'll
Speaker 1: have a conversation about chat GPT and open AI, and
Speaker 1: we think we're there's lots of great use cases that
Speaker 1: we can leverage that technology for, and there's also a
Speaker 1: lot of uh under probably some understood and some not understood,
Speaker 1: unintended consequences from that technology. Think you'd very fundamentally disruptive. Absolutely,
Speaker 1: I don't think there's any doubt. Want to own a
Speaker 1: piece of Silicon Valley history, Maybe you now do. Because
Speaker 1: Twitter was opening off it's old office supplies at the
Speaker 1: six thirty one lots on offer, and some of them
Speaker 1: went the tens of thousands of dollars, for example, a
Speaker 1: blue Neon light, the Twitter about itself, maybe an apt
Speaker 1: sign that was a planter, all of these going for
Speaker 1: big bucks. The auction house behind it says that this
Speaker 1: isn't actually to secure the financing of Twitter itself, although
Speaker 1: we do know is in a relatively precarious situation at
Speaker 1: least to be paying down debt, and Elon Musk himself
Speaker 1: is or not paying some of the rents over in
Speaker 1: San Francisco. But for now the auction is done, and
Speaker 1: maybe you now have a piece of corporate history and
Speaker 1: you've checked it out, because I think it's stopped the
Speaker 1: auction twenty seven hours long, finished at ten am Pacific time.
Speaker 1: Your time ed right thirty two thousand or there or
Speaker 1: thereabouts for that Neon sign. This is kind of trophy stuff,
Speaker 1: particularly if you work there. So I love that you
Speaker 1: focused on kind of more glitzy, shiny items. What I
Speaker 1: loved was just the endless thumbnails showing tables and chairs
Speaker 1: and if you really wanted, you could buy a full
Speaker 1: office set to furnish your office from Twitter issue. I
Speaker 1: actually know a guy who's been in that building a
Speaker 1: few times, Bloomberg Newses Kurt Wagner, who joins us now.
Speaker 1: Because on top of that news, the report by the
Speaker 1: Information that Twitter's revenue dropped as much as thirty five
Speaker 1: percent last quarter from the same period a year ago. Goss, Twitter,
Speaker 1: You and I we've had a rough two navigating this.
Speaker 1: Let's let's start with the financials and we'll get to
Speaker 1: the furniture. A drop in revenue as reported by the Information,
Speaker 1: I mean, what's happening in sure? Yeah, I mean we've
Speaker 1: been talking about this for a while, right, which is
Speaker 1: that roughly of Twitter's revenue comes from advertising, and if
Speaker 1: you're an advertiser right now, Twitter is a sort of
Speaker 1: a scary place. It's not a comfortable, a safe environment
Speaker 1: to be spending your money. Um, And so I don't
Speaker 1: think any of us are shocked. We've we've seen the
Speaker 1: headlines and news about a lot of these big advertisers
Speaker 1: who are step have stepped back from Twitter, and so
Speaker 1: the reality that this hit them very hard, especially in
Speaker 1: the fourth quarter, when you know a lot of the
Speaker 1: marketing budgets usually come about, is not a super big
Speaker 1: surprise to me. How is Twitter in chief dealing all
Speaker 1: of this because many it sort of commented that the
Speaker 1: tweets coming from Elon Musque have got a little less
Speaker 1: well controversial, shall we say, of late, But how is
Speaker 1: he trying to ensure that people are coming back to
Speaker 1: the platform wanting to advertise for him. Yeah, it does
Speaker 1: seem like he has sort of maybe redirected some of
Speaker 1: his attention, right and and perhaps that means to Tesla. Obviously,
Speaker 1: at the end of the year beginning of this year,
Speaker 1: there was a lot of um frustration from Tesla investors
Speaker 1: that that he was not paying closer attention to the company.
Speaker 1: And so this may just be simply that you know,
Speaker 1: he he got there, He did a lot of the
Speaker 1: budget cuts that he was planned, the layoffs that were planned,
Speaker 1: and now he feels like he can sort of redirect
Speaker 1: attention elsewhere, right, But I think like bringing people back, unfortunately,
Speaker 1: that just takes time and it takes trust if you're
Speaker 1: an advertiser, and I'm not sure that Twitter has really
Speaker 1: earned um the trust back from those big brand marketers.
Speaker 1: And it's probably the kind of thing that will take
Speaker 1: a while and they'll have to watch and say, like,
Speaker 1: is Ellen just taking a couple of weeks off of
Speaker 1: tweeting controversial things or is this the new normal for
Speaker 1: him moving forward? And I don't think we can say
Speaker 1: that just yet. I want to dig deep into financials.
Speaker 1: I want to talk about the world's second richest man
Speaker 1: and how he's going to bring advertise this back. But
Speaker 1: I'm not going to ask you about that. You want
Speaker 1: to know about the chairs chairs. I want to know
Speaker 1: about this auction. You're right, did you buy anything or
Speaker 1: I didn't buy anything? Um, maybe a high top table.
Speaker 1: You and Caroline can come over for dinner sometime. That
Speaker 1: would be quite fun. But no, I mean, like it's sad,
Speaker 1: right it is. There is a serious point behind this,
Speaker 1: which is that many people lost their jobs, that building
Speaker 1: was once full. It makes sense from a logistic standpoint, right,
Speaker 1: if your Twitter used to have close to thousand employees
Speaker 1: um and you now have of that, you don't need
Speaker 1: all this office space, you don't need all this office furniture.
Speaker 1: You don't need five hundred white boards or five hundred
Speaker 1: standing desks or whatever may be, right, So it makes
Speaker 1: sense that they would get rid of this. But I
Speaker 1: think you know what a lot of people are seeing, right,
Speaker 1: is sort of like a yard sale from this company
Speaker 1: that had UH for a long time, like a very
Speaker 1: visible culture, probably more than most tech companies, right with
Speaker 1: the AT symbol or the big neon bird, Like these
Speaker 1: are the things we would see pictures of at like
Speaker 1: the office holiday party or whatever. Right, So I just
Speaker 1: feel like maybe there's a little bit more UH kind
Speaker 1: of connection to Twitter's culture than most companies, just because
Speaker 1: so much of it plays out on the service itself.
Speaker 1: So looking at the stats, the bird statue went for
Speaker 1: a hundred thousand in the auction, but Heritage Global Partners,
Speaker 1: who is behind the auction, kept saying that this isn't
Speaker 1: for the finances. Why do it then, and why do
Speaker 1: it say publicly? Well, I think to do it is
Speaker 1: again sort of like a space thing, right, Like if
Speaker 1: you're really getting rid of offices in the way that
Speaker 1: we've seen Twitter get rid of close the Seattle office.
Speaker 1: I think there was a Singapore office as they that
Speaker 1: they closed last week as well, Like you've got to
Speaker 1: do something with all the stuff that's in those offices. Right,
Speaker 1: there's a logistics part of this where they no longer
Speaker 1: have the space to hold it, So I think that's
Speaker 1: probably part of it. Now doing it publicly, I guess,
Speaker 1: how are you going to get the most bang for
Speaker 1: your buck? Right? You have to make sure people know
Speaker 1: to go bid on this thing. So I'm sort of
Speaker 1: speculating here, right because we haven't heard Eylan say here's
Speaker 1: the strategy behind the auction, But my guests would be
Speaker 1: that that's why they want to do it the way
Speaker 1: that they've been doing it all right. Bloomberg's Curt Wagner
Speaker 1: covering every twist and turn inside and outside of Twitter,
Speaker 1: Thank you so much. I actually want to turn to
Speaker 1: the latest on Apple because another day, another scoop, and
Speaker 1: it's taking on Amazon and Google, according to sources, by
Speaker 1: expanding their in home product lineup. Meanwhile, Apple still planning
Speaker 1: to unveil its first mixed reality headset this year, but
Speaker 1: the plans for a lightweight augmented reality glasses have been postponed,
Speaker 1: sources say, due to technical challenges. Bloomberg's Mark German broke
Speaker 1: both of those stories in the space of a single
Speaker 1: working day, and I'm delighted to say, joys, Caroline and I.
Speaker 1: Now let's let's start with the in home devices, because actually,
Speaker 1: when I was at CS in Vegas recently, that was
Speaker 1: a big theme for many of the consumer electronics companies.
Speaker 1: What are the details you've reported? So, actually, this morning
Speaker 1: Apple rolled out a new home pod, right, it's basically
Speaker 1: the return of the original home Pod. It's a bit
Speaker 1: lower cost because they've rolled it out at three instead
Speaker 1: of the original three fifty of the home Pod, there's
Speaker 1: a few there's fewer microphones and tweeters inside the device,
Speaker 1: so not as powerful as the previous one. And it
Speaker 1: uses an Apple Watch processor instead of an iPhone processor,
Speaker 1: so you have a little bit of a shift there.
Speaker 1: But for audio fans, you're really not getting better than
Speaker 1: an Apple home Pod, the big one at three bucks
Speaker 1: in your home. So I know a lot of people
Speaker 1: are looking forward to that product. Now they're working on
Speaker 1: a few other devices. They're working on a faster Apple
Speaker 1: TV for next year, though it won't have eight K functionality,
Speaker 1: and they're also working on a new low end iPad
Speaker 1: for the home smart home appliances, using it to FaceTime,
Speaker 1: using it to watch some video. So that's the smart
Speaker 1: home strategy for Apple moving forward away from smart home
Speaker 1: to a r VA. Just tell us a little bit
Speaker 1: about the strategy there, because it looks as though they're
Speaker 1: struggling with the glasses at least. So Apple has been
Speaker 1: developing it's a r VR strategy for north of six years,
Speaker 1: seven years, eight years at this point, and for a
Speaker 1: long time the strategy was twofold. We're first going to
Speaker 1: roll out this high end halo device that's going to
Speaker 1: be a mixed reality had set merging virtual reality and
Speaker 1: augmented reality, a very complex, expensive three thousand dollar device
Speaker 1: that will cast a shadow over the a r v
Speaker 1: R market, and then as early as a year later
Speaker 1: we would roll out glasses. These are lightweight, a our
Speaker 1: only glasses. That plan has changed. The mixed reality had
Speaker 1: set the high end one the reality pro that's still
Speaker 1: coming this year, but instead of the follow up product
Speaker 1: being the AAR glasses. The successive product is going to
Speaker 1: be a new low end version of the mixed reality
Speaker 1: head set, so one that's probably about half the price.
Speaker 1: Somewhere closer to the same price is the high end
Speaker 1: Meta quest Pro head set. Now, the bigger news those
Speaker 1: are glasses. Those are not coming anytime soon. Those have
Speaker 1: been pushed back indefinitely. Lots of technical challenges, lots of difficulty, right,
Speaker 1: the big headset is going to have about two hours
Speaker 1: of battery life. The a R glasses or something you
Speaker 1: need to wear all day without needing to recharge them
Speaker 1: until nighttime, like a phone or an Apple Watch. If
Speaker 1: the high end device is getting two hours, how could
Speaker 1: a device with even less space for components inside be
Speaker 1: worn all day. There's also challenges related to the displays, right.
Speaker 1: That's called a wave guide technology. To be able to
Speaker 1: see things in front of you while also being able
Speaker 1: to glean information off and displays. They'll have to be
Speaker 1: connected to cellular radios and WiFi, AM Bluetooth at all times.
Speaker 1: So much complexity in that product. So it's gonna be
Speaker 1: many years before we see augmented reality glasses from Apple.
Speaker 1: Expertly analyze for our smart gum and thank you as always,
Speaker 1: will let you get back to your scoop getting Meanwhile,
Speaker 1: coming up, Netflix picks up steam ahead of its earnings
Speaker 1: all important for tomorrow this bring back Netflix earnings as
Speaker 1: usual will focus on the company's new subscribe account. Every quarter,
Speaker 1: it is that way investors always thinking subscribeer growth, did
Speaker 1: it go up? Did it go down? But this time
Speaker 1: around they'll also be looking to initiatives to increase revenue,
Speaker 1: and of course all the rage in the world of
Speaker 1: streaming is add supported tiers, which Netflix launched in November.
Speaker 1: Matt Spiegel, executive vice president of the Media and Entertainment
Speaker 1: Verse call a TransUnion, joins us, it's that interesting dynamic.
Speaker 1: We are obsessed with subscriber growth at all streaming platforms,
Speaker 1: but particularly Netflix. Yet this quarter we're gonna ask ourselves
Speaker 1: how successful as Netflix been in attracting US customers in
Speaker 1: particular to an ad supported tier. Is that the focus
Speaker 1: for you? Yeah? Well, thanks for having me. It certainly is,
Speaker 1: and I quite frankly think it's going to be a challenge,
Speaker 1: but that's ultimately because they're a victim over their own success.
Speaker 1: Do you look at how big Netflix is in the US,
Speaker 1: they really have more subscribers than really any of the
Speaker 1: stream players in the country, and so really the hard
Speaker 1: part is how do you get that penetration to shift
Speaker 1: to add dollars or to an add experience. And the
Speaker 1: likely reality is most of us who have Netflix accounts
Speaker 1: aren't going to do that, and so my guess is
Speaker 1: over the short term it's going to take a little
Speaker 1: while for them to get to the numbers they expect
Speaker 1: on the add model. I think over the long term
Speaker 1: they'll be fine. But you know, if i'd make a
Speaker 1: predictionable here tomorrow, my guests is less AD users than
Speaker 1: they might have ultimately hoped for um, but we'll build
Speaker 1: over time. I actually have some some sympathy to to Netflix,
Speaker 1: so I know have frustrations about how micro focused we are.
Speaker 1: Consensus is for new subscribe editions around four point five million.
Speaker 1: But Karen, I have talked about this in the past.
Speaker 1: There's a whole generation of user out there, many of
Speaker 1: them young people who have never seen ads. They grew
Speaker 1: up where they could stream whatever they wanted whenever they wanted,
Speaker 1: add free, and I wonder if that is a big
Speaker 1: factor here, not just for Netflix, for Disney the attractiveness
Speaker 1: of an ad supportive product, many people just don't want it. Yeah, listen,
Speaker 1: that's fair. Certainly, no consumers says they want ads. But
Speaker 1: if you look at really what happens in the entirety
Speaker 1: of the media ecosystem, there's always a balance there. The
Speaker 1: practical reality as we as consumers can only spend money
Speaker 1: on so many things to really subscribe to. But and
Speaker 1: we're really willing to actually exchange our time, uh, in
Speaker 1: exchange for really subsidizing that experience. Think about certainly the
Speaker 1: cable experience and the linear experience will much less prevalent
Speaker 1: than it was, there are still times we do that,
Speaker 1: and so I don't think we have a question of
Speaker 1: whether advertising is part of the ecosystem or not. You
Speaker 1: really have You've got premium content creators, Netflix being one
Speaker 1: of them, which is always going to look for an
Speaker 1: opportunity to make additional revenue and by the way, very
Speaker 1: highly a creative revenue when its scales in the form
Speaker 1: of advertising. So that balance between subscribers and advertising, I
Speaker 1: don't think it's going anywhere. And sure many consumers won't
Speaker 1: always want advertising, but my guess is you'll you'll always
Speaker 1: find a market somewhere one of those markets. I mean,
Speaker 1: the only time I want advertising is when I'm watching
Speaker 1: the Super Bowl, right, So Matt, to that end, what
Speaker 1: about sport? What about live events? Is that how we're
Speaker 1: going to see the actual product and some of the
Speaker 1: content they provide its rate over a Netflix Listen, I
Speaker 1: think that's exactly right. What we're really talking about is
Speaker 1: netflixs becoming a media company much like the others, right,
Speaker 1: different from a streaming content company that was all about subs.
Speaker 1: You're now talking about having to attract the type of
Speaker 1: eyeballs at one time in scale to balance that ad model.
Speaker 1: And you're right. You're seeing them already invest in or
Speaker 1: reportedly invest in the opportunity to take sports right, and
Speaker 1: I think that will be something they'll continue to do.
Speaker 1: You've clearly seen that work well with an Amazon crime
Speaker 1: and ultimately, if you want to be in the media
Speaker 1: business inclusive advertising, you need to have those quote water
Speaker 1: cooler moments. It's not only sports, but it is clearly
Speaker 1: heavily dominated by sports these days. Those live moments really
Speaker 1: do matter, and that's really what all the media companies
Speaker 1: are finding that right. Balance right, The linear model clearly
Speaker 1: is shifting. Uh, it's not going to die for a while.
Speaker 1: Streaming will be the dominant form of distribution those time
Speaker 1: goes on, but that can be on demand, it can
Speaker 1: still be what really feels like a linear TV ad
Speaker 1: business just in a streaming environment, which is things like
Speaker 1: live sports and balancing all those things is going to
Speaker 1: be what companies like Netflix have to do to compete.
Speaker 1: Listen that they are absolutely in competition for against the
Speaker 1: Disneys and the Warner Brothers of the world, and that's
Speaker 1: part of the ecosystem and kind of I wonder what
Speaker 1: sets them apart from some of the competitors is that
Speaker 1: they get they've got technology in their bones. They all
Speaker 1: group of engineers. They're sort of a tech first but
Speaker 1: also media player, and I'm interested as to whether that
Speaker 1: sets them apart. Can they win the personalization race, if
Speaker 1: perhaps at all putting back on content spend now, Yeah,
Speaker 1: I think that's gonna have to be part of it. Um.
Speaker 1: Certainly there are other companies that have good technology as well,
Speaker 1: but Netflix, to your point, has that at their bones.
Speaker 1: I think that's gonna impact not only their content strategy
Speaker 1: but also their ad strategy. You really got to give
Speaker 1: them credit for how they've approached the ad business so far,
Speaker 1: some really gate you know, senior hires in that team
Speaker 1: a partnership with Microsoft, which makes a ton of sense.
Speaker 1: And so while we're certainly gonna, like I said, I
Speaker 1: expected a short term, it's gonna be a harder ramp
Speaker 1: for Netflix to get to the point where their ad
Speaker 1: business is as scaled as they hope. Um. But having
Speaker 1: that DNA, which is part content, part technology, I agree,
Speaker 1: can only help. You know, certainly, the ad business is
Speaker 1: one where the mix of scale and precision matters right.
Speaker 1: Advertisers are absolutely absolutely looking for that balance and a
Speaker 1: Netflix who can hopefully invent in the right ways to
Speaker 1: provide both a scaled audience but doing that in a
Speaker 1: real targeted way with interesting new add creative which again,
Speaker 1: let's be clear, this is gonna take time. It will
Speaker 1: it will be an evolutionary process, but there's a lot
Speaker 1: to be excited about for Netflix over the long term.
Speaker 1: Now speak of great to have you on that look
Speaker 1: ahead to the earnings. Executive vice president at TransUnion, I mean, well,
Speaker 1: let's pivot back to Switzerland the out to doubles because
Speaker 1: HCl Tech the software giant and it's based in India
Speaker 1: is coming over to talk about how they're focusing on
Speaker 1: s G or nonlinear growth in the long term. Then
Speaker 1: Bloomberg's has an endarm and discussed the company's priorities. When
Speaker 1: the HCl Tech chairperson, that's what's yourn email Hotrah. So,
Speaker 1: I think, you know, we've got a couple of five
Speaker 1: strategic objectives, the first one being we are an IT
Speaker 1: services group and we cover UM digital engineering, cloud as
Speaker 1: well as software. So we want to be able to
Speaker 1: lead with differentiated products and services. We want to be
Speaker 1: able to be a preferred digital partner for global two
Speaker 1: thousand companies in preferred geographies. UM. You know, I think
Speaker 1: weaving E s G into a lot of the business
Speaker 1: strategy is absolutely critical for us. UM A c L
Speaker 1: Technologies hires two five thousand people across the world and
Speaker 1: the average age is twenty seven and below. So I
Speaker 1: think today their strategic priority for a company has to
Speaker 1: be to be a preferred employer. And and then lastly, UM,
Speaker 1: I think if we're able to meet these strategic objectives,
Speaker 1: then you know, delivering the highest shareholder return in medium
Speaker 1: to term it should be the ultimate strategic direction. There's
Speaker 1: so much uncertainty there's so much disruption, what's use strategy
Speaker 1: to stay relevant? So I think, like I said, I
Speaker 1: think one part of it is technology, and what's the
Speaker 1: growth strategy. I think the growth strategy is investing in
Speaker 1: our people and investing in skills. Um you know, like
Speaker 1: I said, we've got twenty five thousand people all over
Speaker 1: the world. Technology is moving a lot faster than the
Speaker 1: skills can keep up. We do about two million to
Speaker 1: three million hours of training a quota, and that is
Speaker 1: only going to grow. We also have to find non
Speaker 1: linear ways of growth. So if you look at our
Speaker 1: software portfolio, which is quite unique to eight sale technologies,
Speaker 1: it's about two billion of our twelve billion revenue. It's
Speaker 1: much more non linear. So while the balance ten billion
Speaker 1: would have more than a hundred and fifty thousand people
Speaker 1: working on it, are two billion in software will have
Speaker 1: about five thousand. You talk about being a twelve billion
Speaker 1: dollar company, how do you take it to thirty? How
Speaker 1: do you take it to fifty? When can you get there?
Speaker 1: I don't know when we're going to get there. I
Speaker 1: think I can only talk about our strategic vision in
Speaker 1: the next five to seven years. But the investment that
Speaker 1: we made in eight c L software, which is a
Speaker 1: two billion that we get from you know, five thousand
Speaker 1: engineers is a non linear growth and I think that
Speaker 1: as we go forward, we're going to want to grow
Speaker 1: that business as well. Indian ID executives lament that there
Speaker 1: is a gap between engineering education and what the industries
Speaker 1: are actually need. How do you bridge that gap, especially
Speaker 1: now that you're part of the thin M T. S
Speaker 1: Dean of the Global Advisory come, thank you so. Um.
Speaker 1: You know, there are a couple of experiments that we're
Speaker 1: doing in eight c L. I of course talked about
Speaker 1: investing in a lot of training, which you know, closes
Speaker 1: the gap between fresh engineers and what they need to
Speaker 1: do to deliver to customers all over the world. We're
Speaker 1: also doing something very interesting, which is we've got eight
Speaker 1: thousand UM fresh school graduates in the eighth c L
Speaker 1: system and we've partnered with university so that on the
Speaker 1: weekends they can pursue an undergraduate education, but Monday to Friday,
Speaker 1: these are eighteen year olds, their digital natives. Um, you know,
Speaker 1: we got them from grade twelve. We've got fifty percent women,
Speaker 1: young women as part of this cohort and after you know,
Speaker 1: eight to nine months of training, they're ready to deliver.
Speaker 1: So it's also looking at alternate talent calls. And you know, um,
Speaker 1: as you go forward in the world, you're going to
Speaker 1: realize that there are more people who don't pursue higher
Speaker 1: education than those who actually do, because higher education is
Speaker 1: becoming prohibitively expensive. So how do we actually tap into
Speaker 1: different talent calls? And so I think that's quite unique
Speaker 1: to a cl tech going viral today? What was the
Speaker 1: fear of opening your bank account to see a negative balance?
Speaker 1: Dozens of Bank of America customers using the transaction service
Speaker 1: zell they were tweeting about how their funds Sunday disappeared overnight,
Speaker 1: although they had trouble logging into the Banking Apple tool.
Speaker 1: Now the website down detector had hundreds of reports. Then
Speaker 1: there were issues with zul. Take a look at this
Speaker 1: chart and app similar of course, the vemmo built by
Speaker 1: a group of news biggest banks like Bank of America.
Speaker 1: Those reports they seem to have died down by Wednesday afternoon. Now,
Speaker 1: according to American Banker, Zel runs more than one point
Speaker 1: six billion dollars in transactions daily. This is heavily lent
Speaker 1: upon an overall, I know that I use it. I
Speaker 1: know that many many person uses to log on and
Speaker 1: does see negative also freaked out. Yeah, I mean then
Speaker 1: saying as P s A. I guess three pm Eastern
Speaker 1: this was resolved. But you know, if if Instagram goes down,
Speaker 1: Twitter goes down, whatever, your bank account goes down and
Speaker 1: then shows missing funds, that's different and seeing social media
Speaker 1: response savage. Yeah, I have to say some of the
Speaker 1: memes are pretty great. Go and check them out on
Speaker 1: Twitter or on Instagram. Meanwhile, that does it. From the
Speaker 1: addition of technology, Thursday, we'll share new data about crypto
Speaker 1: launderings from chain analysis. Don't forget the problem.