Speaker 1: From the heart where innovation, money and power. Collie in
Speaker 1: Silicon Vallet NBN. This is Bloomberg Technology with Caroline Hyde
Speaker 1: and Ed lud Love.
Speaker 2: I'm Caroline Hyde at Bloomberg's Weld headquarters in New York
Speaker 2: and Ourmed Ludlow in San Francisco.
Speaker 3: This is Bloomberg Technology.
Speaker 2: Coming up and changing of the guard. Over at Twitter,
Speaker 2: Elon Musk announces he's stepping aside as CEO. We'll bring
Speaker 2: in the details on the successor Claus.
Speaker 4: We'll talk artificial intelligence and how companies are implementing guardrails
Speaker 4: to deliver and embed AI responsibly.
Speaker 2: And soft Bank has begun testing investor appetite for the
Speaker 2: IPO of ARM, seeking as much as ten billion dollars.
Speaker 2: Will bring you that and so much more this hour
Speaker 2: as we look at what market sentiment is like to
Speaker 2: round out this week, pretty dire, really collapsing on the
Speaker 2: ten am mark here in the United States, as we
Speaker 2: get the University of Michigan sentiment from the consumer right
Speaker 2: now that still sees inflation at about three percent for
Speaker 2: the next five to ten years. That inflationary pressure still
Speaker 2: pushing down there for on the tech stocks on the day,
Speaker 2: we're seeing the two year yield actually rise some nine
Speaker 2: basis points. How much is a federal reserve going to
Speaker 2: have to tackle that embedded view of the consumer Aware
Speaker 2: inflation is heading, of course, we've also got anxiety about
Speaker 2: a ceiling about the banking system, plenty still to chew
Speaker 2: on as we head towards the weekend. Interesting moves in
Speaker 2: the emerging markets as well. Keep an eye on Turkey,
Speaker 2: which looks pretty buoyant from the banking system there as
Speaker 2: they look towards a key vote. Could Ernuwan be waved
Speaker 2: goodbye to this weekend? And also look at South Africa.
Speaker 2: We've got the rand really collapsing on the day as
Speaker 2: we see concerns about the relationship between South Africa and
Speaker 2: the US, all to do with Russia supply of arms.
Speaker 2: Let's pick it on agear, because I want to look
Speaker 2: at what's happening in terms of crypto and dollar has
Speaker 2: had a real rally this week on the back of
Speaker 2: some of these inflation concerns and the slowdown in the
Speaker 2: overall jobs data as well. We're seeing bitcoin off by
Speaker 2: nine percent on the course of the week, ed quite
Speaker 2: a sell off, in fact, the first back to back
Speaker 2: weekly loss a bitcoin since back in March. But dive
Speaker 2: into some of the micromovers and starts today.
Speaker 4: Yeah, look, it's a kind of markets day where there's
Speaker 4: a lack of news headlines, particularly in the technology sector.
Speaker 4: I look at some of the megacaps. Actually, one mover
Speaker 4: to the upside is Alphabet, the parent of Google, up
Speaker 4: by six tenths of a percent. You see some of
Speaker 4: its megacap peers moving to the downside, dragging down the
Speaker 4: nas That one hundred is an example for the Alphabet
Speaker 4: actually on track for its best week since mid March.
Speaker 4: I think there's a lot of momentum in this name
Speaker 4: from all the news we got from the Google io
Speaker 4: around what they're actually doing in AI. This show Bluemberg
Speaker 4: Technology today is going to have.
Speaker 3: A big AI theme.
Speaker 4: But we're not seeing sort of news driven moves in
Speaker 4: the markets. Apart from Tesla. Let's take a look at
Speaker 4: this stock. It's interesting had been higher at the open,
Speaker 4: markedly higher, up by a couple of percentage points. We're
Speaker 4: now softer by one point four percent. Three factors in
Speaker 4: the market, one the principal one being we do have
Speaker 4: a new CEO at Twitter, Linda Yakarino. We will get
Speaker 4: into that momentarily. Also news elsewhere that they've raised prices
Speaker 4: incrementally on the Model Y in the US two hundred
Speaker 4: and fifty dollars and on some of the more expensive
Speaker 4: models like Model why sorry, more expensive models like the
Speaker 4: Model Let's having a one thousand dollar price bump. In China,
Speaker 4: there is a soft recall for a software fix on
Speaker 4: Regenerative breaking one point one million units or so. A
Speaker 4: lot happening. But we're down one and a half percent
Speaker 4: on Tesla. I think a lot of this has the
Speaker 4: market's passing. What's happening at Twitter Elon Musk's other company.
Speaker 2: Yeah, that's stick into that, of course, because he is
Speaker 2: announcing said it last night. In fact, stepping down, stepping
Speaker 2: back is Twitter CEO in the next coming weeks, and
Speaker 2: reports now name NBC ad chief Linda Yacarino as his
Speaker 2: successor for more let's bring him luez Asha Counts interestingly,
Speaker 2: comcast down a little bit on the news that they're
Speaker 2: losing this ad chief over at NBC Universal. But we
Speaker 2: do see finally what someone who gets advertising been paired
Speaker 2: with someone who gets the technology.
Speaker 5: Yeah, it's huge, right, Twitter is advertising revenue has declined
Speaker 5: about fifty percent maybe more since must have over he's
Speaker 5: really alienated a lot of advertisers with some of his
Speaker 5: erratic decision making and things like getting into a spat
Speaker 5: with the ex employee who was disabled and making comments
Speaker 5: that were perceived by some to be sexist against women,
Speaker 5: and all these sorts of things have really driven advertisers away.
Speaker 5: So bringing in someone like Linda, who has such deep
Speaker 5: experience in the advertising industry, has those relationships, has an
Speaker 5: amazing reputation like that could be huge for Twitter and
Speaker 5: really rebuilding trust with advertisers.
Speaker 4: Caroline Asha Elon Musk has tweeted in the last fifteen minutes,
Speaker 4: let's bring that up and show our audience. He says,
Speaker 4: I am excited to welcome Linda Yakarino as the new
Speaker 4: CEO of Twitter. So there you have it, official confirmation.
Speaker 4: He tags Linda Yakarino and says that you'll focus primarily
Speaker 4: on business operations while he focuses on product design, new technology.
Speaker 4: Looking forward to working with Linda to transform this platform
Speaker 4: into X the everything app. That is the kind of
Speaker 4: key key part right that this is one step to
Speaker 4: a bigger project.
Speaker 3: Asia. Yeah.
Speaker 5: Musk has talked a lot about this idea of having
Speaker 5: an everything app, right, modeling on something like we chat
Speaker 5: in China where you can book events and tickets and
Speaker 5: pay for things. So he's talked a lot about that
Speaker 5: and sort will be interesting to see if he's actually
Speaker 5: able to execute on that idea. And then we know, right,
Speaker 5: a number of weeks ago he put Twitter underneath this
Speaker 5: holding company called X.
Speaker 6: Right, so technically Twitter Inc.
Speaker 5: Doesn't exist, but it's underneath this company called X and
Speaker 5: it's part of his vision to sort of make Twitter
Speaker 5: an app that can do everything.
Speaker 2: I've got to sort of reflect on all the messiness
Speaker 2: of all of this. So a shit because if we
Speaker 2: reflect on what's just happened to comodcasts NBC Universal, they're
Speaker 2: about to go to their advertising community, they're about to
Speaker 2: have their upfronts. They're about to be pitching how you
Speaker 2: should be lining up your advertising against some of their
Speaker 2: online offerings, and particularly on Peacock, and the main women
Speaker 2: to do that has just exited stage left in quite
Speaker 2: a sort of erratic manner. It can't be a great
Speaker 2: end to that part of her career and start on
Speaker 2: the next one.
Speaker 6: Yeah, it has to be difficult, right.
Speaker 5: She was really integral to NBC efforts like Peacock, which
Speaker 5: is you know, the ad supporters dreaming service, to even
Speaker 5: establishing partnerships and relationships with some of the tech companies
Speaker 5: including Twitter, Snapchat, YouTube and others, and then even huge
Speaker 5: events like the Super Bowl in the Olympic Games. So
Speaker 5: she had a really really important role at NBCU, and
Speaker 5: so I can imagine it's going to be tough now
Speaker 5: that that she's leaving at this last moment when she
Speaker 5: had a lot of those relationships and was responsible for
Speaker 5: a lot of those relationships with advertisers. Good for Twitter,
Speaker 5: but obviously really tough for NBCU, which has had its
Speaker 5: own sort of internal praders with the past as well.
Speaker 4: Yeah, with the departure of their leader in recent weeks.
Speaker 4: It's interesting the CV Asia. We reported in October that
Speaker 4: when Elon Musk brought in those private investors for ex
Speaker 4: Corps now EX Holdings, he stayed in writing the plan
Speaker 4: to take the company known as Twitter public again in
Speaker 4: a three to five year horizon. But you look at
Speaker 4: Lindy Yakarino, she doesn't have CEO experience and there are
Speaker 4: still advertiser concerns, right, I mean, just give us the
Speaker 4: latest on the advertiser flight and the impact of revenue.
Speaker 5: Yeah, so the last time we looked at the numbers
Speaker 5: here at Bloomberg, right, it was still a large majority
Speaker 5: of advertisers on Twitter had left. So advertising revenue was
Speaker 5: down amongst the top ten advertisers from like seventy million
Speaker 5: to something like seven million, So it was a huge,
Speaker 5: huge decline. And even today, advertisers that I've spoken to
Speaker 5: are still a little bit concerned about brand safety. So
Speaker 5: some of you may have noticed on Twitter there seems
Speaker 5: to have been almost a rise in misinformation and hate speech.
Speaker 5: Advertisers are concerned about that. They're concerned about some of
Speaker 5: must own tweets himself and some of his erratic decision making,
Speaker 5: and so advertisers still have a lot of concerns about Twitter.
Speaker 5: And honestly, Twitter was not always necessarily a top advertising
Speaker 5: destination anyways, just because it's a lot smaller than its
Speaker 5: competitors like Meta. So there's still going to be a
Speaker 5: lot of challenges in getting advertisers back and really ensuring
Speaker 5: them that when they put an advertisement on Twitter, it's
Speaker 5: not going to appear next to some misinformation or fake news,
Speaker 5: that it's going to appear next to tweets that are
Speaker 5: saved and are not going to damage their brand reputation.
Speaker 4: All right, Bloomberg seish accounts, thank you so much, busy
Speaker 4: twenty four hours for you and I both so Carral
Speaker 4: investors poured nearly four billion dollars into tech stocks over
Speaker 4: the course of the week. But Bank of America is
Speaker 4: splashing cold water on this rally, saying this prolonged period
Speaker 4: of economic decline in the US were royal technology stocks
Speaker 4: at the time where they're attracting a way of investor money.
Speaker 4: A team led by Michael Harnett expects a recession to
Speaker 4: crack credit and tech just as it did back in
Speaker 4: two thousand and eight. And there's so many eye to
Speaker 4: this debate, right. There's those that look at the megacaps
Speaker 4: and say balance sheet and trench market position, look at
Speaker 4: the activity in the corporate credit sector, the demand detect
Speaker 4: is there. Bank of America things differently.
Speaker 2: Yeah. I mean, whether you see big tech as some
Speaker 2: sort of haven in downturns or whether you see it
Speaker 2: as a bet still on growth. And let's just look
Speaker 2: at the growthier part of this, because the exuberants around
Speaker 2: a lot of these tech stocks I think of in
Speaker 2: video I think has some of the chick names. It's
Speaker 2: largely on the back of artificial intelligence, isn't it? And
Speaker 2: I thought there was a great note from Sotschen today.
Speaker 2: Key Stretchers is over there saying, look, actually all the
Speaker 2: main driving force of the equity rally this year and
Speaker 2: the SMP, it's all artificial intelligence. It's a strip away
Speaker 2: that sort of euphoria around certain AI stocks and actually
Speaker 2: the SMP would be in the red for this year.
Speaker 2: I'm loving this from Nash Cabra. It was really interesting.
Speaker 2: He's riding over in London, but they really cite the
Speaker 2: ninety six percent increase and in video overall, but Alphabet
Speaker 2: the Microsoft's what would happen if we sort of took
Speaker 2: away some of Alxuberant said.
Speaker 3: We saw it in the private markets.
Speaker 4: First, think back weeks months ago, all the money going
Speaker 4: to AI startups, and then the last three weeks what
Speaker 4: happened earning season. And this is what I've been looking
Speaker 4: at on the Bloomberg terminal, which is a fantastic chart
Speaker 4: that to how our chart's chief and I have been
Speaker 4: passing over. So go back all the way to twenty fifteen,
Speaker 4: and this is a basket of around twenty of the
Speaker 4: biggest technology names across the S and P five hundred
Speaker 4: and as that one hundred like nada zero mentions of
Speaker 4: the phrase artificial intelligence or AI.
Speaker 3: Fast forward to the first quarter of.
Speaker 4: Twenty twenty three and across the earnings cool transcript. That's
Speaker 4: what we've analyzed, more than two hundred mentions just for
Speaker 4: that basket of twenty companies. That's a massive ramp up
Speaker 4: in activity. It's been gaining. But look, first quarter of
Speaker 4: twenty twenty three, this is the here and now. AI
Speaker 4: is everything for corporate America.
Speaker 2: It is, but with that exuberance comes for many a
Speaker 2: healthy Joseph caution, A healthy Dooseph, how do you inject
Speaker 2: artificial intelligence into your business model in this safe way?
Speaker 2: We're going to have that exact conversation right now, ed
Speaker 2: because Navrida sings with us AI found a CEO GOODEOII
Speaker 2: is actually a responsible oftificial intelligence governance platform. Basically, you
Speaker 2: are empowering organizations to what delivered to embed AI, but
Speaker 2: do it responsibly, do it proactively, monitor it, manage it.
Speaker 2: And I'm interested in Nevrena, how many companies you think
Speaker 2: are actually holding back on interjecting generative AI because they
Speaker 2: are worried about some of the risks that are involved.
Speaker 7: Thank you so much for having me And what a
Speaker 7: critical topic right now, Carolyn, VA are seeing across the industry.
Speaker 7: Right now, generative AI already reinventing businesses. The top of
Speaker 7: mind questions for many of our customers is, you know,
Speaker 7: how can they continue innovating responsibly or get crushed by
Speaker 7: this generative AI wave. So right now, the top of
Speaker 7: mind question that we are hearing across our customers and
Speaker 7: partners is how can I adopt GENITIVEVII confidentally and responsibly
Speaker 7: to make sure that the risks like copyright, appy IP leakage, plagiarism, etc.
Speaker 6: Are under check.
Speaker 2: Your background is fascinating because you're building this way of
Speaker 2: monitoring and doing it responsibly. You used to be a
Speaker 2: director of product over at Microsoft. Thinking about the ways
Speaker 2: in which AI can be commercialized. Is corporate America at
Speaker 2: this moment being thoughtful enough? Is VC private money being
Speaker 2: thoughtful enough about the guardrails and known to go in
Speaker 2: place at the same time as the exuberance around just
Speaker 2: the innovation.
Speaker 7: You know, Carolyn, there is some momentum, but it needs
Speaker 7: to be more. As you can imagine, Now it's not
Speaker 7: about just winning the DEI. It is also about how
Speaker 7: you win the DEI. And this is where you're going
Speaker 7: to start seeing a lot of differentiation among organizations that
Speaker 7: actually are more just leaders in.
Speaker 6: This age of AI.
Speaker 7: Where there is investment in the I governance, where there's
Speaker 7: investment in oversight, whether investment is not in not only
Speaker 7: understanding AI risk but managing them at scale while also
Speaker 7: keeping an eye out to future regular that's where we
Speaker 7: are going to see the wins emerging in the ecosystem.
Speaker 7: So AI governance is certainly underfunded and certainly you know,
Speaker 7: becoming top of mind, but we need to see more
Speaker 7: progress and momentum in this space.
Speaker 4: And avery in a good morning to you government compliance
Speaker 4: doing business with the public sector. What level of government
Speaker 4: clients does CREDO have. Are you able to offer your
Speaker 4: services to the federal government as an example?
Speaker 7: Absolutely?
Speaker 8: Ed.
Speaker 7: So recently we announced a very strong partnership with booths
Speaker 7: Allen that exactly that focus. As you can imagine, there's
Speaker 7: been an emerging discussion Invice House around how do you
Speaker 7: know make sure that frameworks like billa frids are implemented
Speaker 7: appropriately across US agencies so that we're always keeping you know,
Speaker 7: US citizens right. Central to this conversation, the creator AI
Speaker 7: right now is working across United States government as well
Speaker 7: as this partners like Booze Alan so that we can
Speaker 7: bring AI governance as a mechanism for them to activate
Speaker 7: AI adoption. But due to again safely and.
Speaker 4: Responsibly, there's a debate within the artificial intelligence community AI
Speaker 4: native or AI adjacent startup founders basically looking at regulation
Speaker 4: and saying, well, if we think about healthcare or education,
Speaker 4: those are highly regulated industries where the consumer faces high
Speaker 4: prices or there are still risks in place. What is
Speaker 4: the benefit of focusing on a commercial guard rail versus
Speaker 4: seeking comprehensive regulation.
Speaker 7: Yeah, you know, ed, I think this is where we
Speaker 7: have to really strike a right balance between innovation and
Speaker 7: regulation that supports that innovation. And you know, there's global
Speaker 7: initiatives that I'm actually actively involved in. TRETO as involved
Speaker 7: in again to make sure that AI governance and oversights
Speaker 7: are cross the entire value chain from design, development to
Speaker 7: procurement and.
Speaker 6: New of EI systems happen.
Speaker 7: And so you know, this is an opportunity for us
Speaker 7: to really bring in private and public sectors together to
Speaker 7: ensure that policy goes hand in hand with innovation, so
Speaker 7: that it can become an accelerant rather than a deterrent
Speaker 7: to the THEI innovation.
Speaker 4: Never in a sing creto AI CEO, thank you for
Speaker 4: your time. Now sticking with AI, the music industry's biggest
Speaker 4: threat now is AI generated songs that are going viral.
Speaker 4: Industry executives, most notably Spotify CEO Daniel Eck, have been
Speaker 4: quick to promise heightened vigilance on behalf of labels, artists,
Speaker 4: and copyright holders. But while the platforms are sizing up
Speaker 4: the new disruptive force, labels and managers say that fraud
Speaker 4: is already rampant. User generated content and bogus tracks may
Speaker 4: now can account for ten percent of all streams.
Speaker 2: Karen, amazing those statistics. I mean, well, let's shift get
Speaker 2: us a little bit ed. We've going to go to
Speaker 2: an old school in the world of technology. We're going
Speaker 2: to Squarespace with the man who built it twenty years ago.
Speaker 2: The CEO howses website still such a prominent building platform.
Speaker 2: How's it developing tools necessary to serve small businesses? And
Speaker 2: let's face it, we'll ask a question about AI or two.
Speaker 2: I'm sure that's next. As a Bloomberg.
Speaker 4: Squarespace, known for its suite of services in website building,
Speaker 4: domains and marketing tools, is reaffirming's mission to serve small
Speaker 4: businesses and creatives after twenty years of operations. We welcome
Speaker 4: its founder and CEO, Anthony Casalina to the program. Anthony,
Speaker 4: Good afternoon to you out in New York. Good morning
Speaker 4: here from in San Francisco. You had earnings on Tuesday
Speaker 4: and you raised four year guidance for revenue, and I
Speaker 4: want to get right to it and ask how much
Speaker 4: of that confidence is driven by the moment we're having
Speaker 4: in AI.
Speaker 9: Yeah.
Speaker 10: First off, thank you for having me, and you know,
Speaker 10: just a fantastic quarter for us. We were able to
Speaker 10: beat and raise, maintain our strong cash flow profile, and
Speaker 10: continue to accelerate growth, which is really fantastic. Another point
Speaker 10: on the quarter is that trial starts, a number of
Speaker 10: people trying our core product was the highest of any quarter,
Speaker 10: even including pandemic.
Speaker 1: Quarters, which were record high for us.
Speaker 10: You know, as you mentioned and as I you know,
Speaker 10: spent a lot of time talking about on our earnings call,
Speaker 10: AI is something that's you know, we actually know a
Speaker 10: lot about our industry is no stranger to it.
Speaker 1: I would say two things about it.
Speaker 10: One is sort of you know where scort space is
Speaker 10: right now and where we're going in terms of where
Speaker 10: we take things with AI. So Scortespace stopped the need
Speaker 10: for a lot of people who use our platform for
Speaker 10: programming websites about two decades ago, so that's not something we,
Speaker 10: you know, are planning on necessarily using AI for at
Speaker 10: this time. You know, once you get start up with scores,
Speaker 10: we do a lot more than just generate a website.
Speaker 10: We hosted, deal with bandwidth, cybersecurity, DDoS protection, dns as
Speaker 10: a seal, certificates, domain registration, you know, just a myriad
Speaker 10: of things that you need after you, you know, have
Speaker 10: designed the website, and we do that for sixteen dollars
Speaker 10: a month as a starting point, so you know that
Speaker 10: stuff is as relevant as ever for our customers. I'll
Speaker 10: say two things about how we've been incorporating AI in
Speaker 10: large language models today and where we're going to be
Speaker 10: incorporating them in the future. So one of the main
Speaker 10: reasons why people have a trouble starting with scorespace is
Speaker 10: they say their content is not ready, they don't have
Speaker 10: the images they need for their site. They don't know
Speaker 10: how to write an about page, they don't have their copyright.
Speaker 10: So actually, this past Monday, right before earnings, we introduced
Speaker 10: chat Beat GPT based large language model content generation in
Speaker 10: all of our text fields and we launch that and
Speaker 10: beta to our circle community.
Speaker 1: So we're super excited about that.
Speaker 2: The other place, did that moment that you announced that
Speaker 2: you were integrating with open AI, did that clearly make
Speaker 2: a lift? Did your people start to turn to say
Speaker 2: this is exciting, this is going to change dull or
Speaker 2: are they just like yes, obviously?
Speaker 10: I think it was more of yes, obviously. You know,
Speaker 10: we've been aware of these models for months. I mean,
Speaker 10: AI has been part of setup in our industry for
Speaker 10: I believe about eight years, so we've been looking at
Speaker 10: it extensively, which kind of brings me to the second
Speaker 10: place where we're incorporating AI. In Q one, we launched
Speaker 10: something called Scorespace Blueprint, which lets people get started building
Speaker 10: a template and bypassing our template store, that's a perfect
Speaker 10: spot for us to integrate essentially prompt engineering on top
Speaker 10: of a large language model. You can tell us more
Speaker 10: about what you want and we can generate those sections
Speaker 10: for you so that you don't have to be picking
Speaker 10: a full template out at once. So perfect place is
Speaker 10: where we expect to see a lot of AI tailwinds.
Speaker 2: It's interesting, isn't it, ed at the moment that poor
Speaker 2: people come on to want to talk about their general
Speaker 2: earnings and we go straight for the AI focus. But
Speaker 2: a lot of this is about how on earth ed
Speaker 2: I think people are going to be coding in the future.
Speaker 2: People are going to be burning in the future.
Speaker 4: Anthy I have to ask you on self reflection how
Speaker 4: much you feel an existential threat. The debate that I
Speaker 4: hear daily is do we even need computer scientists anymore?
Speaker 3: Do we need coding?
Speaker 4: I know that you explained that you've taken that process
Speaker 4: away twenty years ago, but you look at the demos
Speaker 4: from Google on Wednesday.
Speaker 3: I was there.
Speaker 4: Look at what open ai demonstrates. Anyone can request code
Speaker 4: and do anything with the code generated. So what's the
Speaker 4: point in squarespace?
Speaker 1: Oh?
Speaker 10: I mean the point in squarespace is the list of
Speaker 10: things I rattled.
Speaker 1: After you have the code.
Speaker 10: After you have the code, you have to hosted, provide
Speaker 10: bandwidth storage, get a content, delivering a network on there,
Speaker 10: prevent against data as attacks, get DNS running, get your
Speaker 10: domain running. Squarespace does our ad for sixteen dollars a month.
Speaker 10: If you were to also then pretend, not pretend, but
Speaker 10: believe that all of our you know, all the programmers
Speaker 10: in the world are suddenly going to be out of jobs,
Speaker 10: which I certainly don't believe, then it would be very
Speaker 10: interesting because then we would be modeling our company at
Speaker 10: what something like a seventy percent free cash flow after
Speaker 10: we can run it without employees or something that's nothing
Speaker 10: we believe in. You know, we we have a fantastic
Speaker 10: creative and engineering team and we're building that team not
Speaker 10: thinking about a world where they don't exist. Further, in
Speaker 10: other areas, like you know, customer support, We've had AI
Speaker 10: based chatbots implemented for over five years. We monitored reflection relates.
Speaker 10: Those are only better with GPT models, So we anticipate. Yeah,
Speaker 10: really a lot of tailwinds from these technologies being incorporated
Speaker 10: in the Squarespace, in the content generation, in a setup process,
Speaker 10: and we think it doesn't really crack much at all
Speaker 10: from the infrastructure we provide.
Speaker 2: Anthony, great to have you, thanks for talking us to
Speaker 2: Anthony Casselina that his CEO and founder a Square Space
Speaker 2: from New York. From San Francisco. Listen, bloomg.
Speaker 3: Welcome back to Bloomberg Technology. I med Love in San Francisco.
Speaker 2: I'm Caroline hid in New York. Let's get to these
Speaker 2: markets today, ed, because it's an interesting one as we
Speaker 2: just see a little bit of caution as to go
Speaker 2: into the weekend. We have the macro data looking a
Speaker 2: little ugly if you look at the inflationary pressures, the
Speaker 2: perspective of the consumer, the eumish data, we're down by
Speaker 2: seven ten percent now, so tech takes a hit when
Speaker 2: we've got inflation front and center because we think the
Speaker 2: Fed's going to have to hike two year yield up
Speaker 2: eight basis points. In the back of that bitcoint actually
Speaker 2: having a bit of an ugly week and indeed down
Speaker 2: some two percent on the day. It's down more than
Speaker 2: ten percent nine percent over the course of the training week.
Speaker 2: That's because of the strength in the US dollar as
Speaker 2: well as warries, perhaps a little bit about the liquidity
Speaker 2: out there and some of the regulatory risk. Let's plick
Speaker 2: it on and look at how individual stocks are doing
Speaker 2: on the day. Because Google, I have to say you
Speaker 2: were there on Wednesday, Google, I owe, this has really
Speaker 2: lit the fire beneath some Google Stock of late and
Speaker 2: we're seeing Alphabet shares that seven tenths of an percent
Speaker 2: and one of the biggest contributors to the points on
Speaker 2: the upside at leads for some of the benchmarks. Today
Speaker 2: we're seeing it up what ten percent of the course
Speaker 2: of the week, best week since the end of March.
Speaker 2: First Solar interesting buying a company in Europe. We don't
Speaker 2: often see a company really shoot higher when it's spending
Speaker 2: some money, but it seems to be really net additive
Speaker 2: to the overall business offering. We're up twenty three percent
Speaker 2: on First Solar, and I'm looking at Comcast down by
Speaker 2: three tens percent. Of course, the owner of NBC Universal,
Speaker 2: which today we understand ed, is having to say farewell
Speaker 2: to their ad chief of MBC and we know where
Speaker 2: they're going. Twitter. We'll talk about that in a minute.
Speaker 1: We will.
Speaker 4: Those are your tech markets. These are your tech headlines
Speaker 4: in talking tech. First up, vin Fast, the ev maker
Speaker 4: founded by Vietnam's richest person, going public via spack in
Speaker 4: what would be the largest ever US listing buyer company
Speaker 4: from Southeast Asia. The deal will give vin Fast and
Speaker 4: equity value of about twenty three billion dollars. Sticking with
Speaker 4: EV's Tesla facing issues in China, the TV maker will
Speaker 4: need to fix almost every car it's ever sold there
Speaker 4: due to a breaking and acceleration defect. Is actually on
Speaker 4: the generative regenerative breaking. It could increase the crash of
Speaker 4: a risk of a crash according to the regulator there,
Speaker 4: impacting about one point one million vehicles. But it is
Speaker 4: a software over the air update that we should point out.
Speaker 4: And back in the US, Tesla has tweaked prices of
Speaker 4: its vehicles for the third time in less than a month,
Speaker 4: adding one thousand dollars to the prices of its Model
Speaker 4: X and Model S. The base model s Now costs
Speaker 4: a little more than eighty eight thousand dollars, still about
Speaker 4: sixteen thousand less than it was at the start of
Speaker 4: the year.
Speaker 2: Carac Yeah, and we've got to sit with sort of
Speaker 2: the Tesla theme, or at least its leader, because Tesla's
Speaker 2: shares have been battered around a little bit today because well,
Speaker 2: maybe its focus of Elon Musk is going to turn
Speaker 2: his attention back to it. Why because maybe he can
Speaker 2: take his foot off the gas a little bit when
Speaker 2: it comes to leading Twitter. Of course, let's talk about
Speaker 2: all of this when we're thinking about the leadership at Twitter.
Speaker 2: Who's coming in with Cla diez ortis of course taking
Speaker 2: the focus on the change of leadership and the future
Speaker 2: of the so social media giant. And you're now, of course,
Speaker 2: Kwina Perkins, VC SCOUT, former Twitter executive. What are you
Speaker 2: making of the fact that, ultimately Twitter's had to realize
Speaker 2: that Elon Musk is great on the tech side of things,
Speaker 2: but they need someone who gets the advertising side of things.
Speaker 6: I think it's so interesting.
Speaker 11: I think, you know, Elon Musk may be a genius,
Speaker 11: but we all make mistakes, including Elon, and it's just
Speaker 11: very interesting to see sort of six months into this journey,
Speaker 11: his realization that advertising, which made up ninety percent of
Speaker 11: Twitter's business, really does matter and keeping those advertisers happy
Speaker 11: and close is really important. And so this move is
Speaker 11: just absolutely a step in that direction, a step in
Speaker 11: hopefully a positive direction to turn around Twitter as a
Speaker 11: business and bring back advertisers to the platform.
Speaker 4: Claire Linda Yakarino, what's your reaction to her as a
Speaker 4: CEO at Twitter.
Speaker 6: I think it's super interesting.
Speaker 11: I am interested to see how this goes forward. You know,
Speaker 11: she and Elon gave a presentation last month at a
Speaker 11: summit in which she seemed to really have a handle
Speaker 11: on his personality, and you know she was even encouraging him.
Speaker 11: You know, advertising is important, Elon, Why don't you get
Speaker 11: off the Twitter at three am? So I think there's
Speaker 11: hope here that she will be able to bring some
Speaker 11: hast and some leadership to the company, which it really needs.
Speaker 11: I mean, as I said, the revenues have just plummeted.
Speaker 11: We know that, you know, advertising revenue used to make
Speaker 11: up ninety percent of Twitter's business, and we know that
Speaker 11: that advertising revenue is down about sixty percent now. And
Speaker 11: what it really needs, what Twitter really needs is a
Speaker 11: leader who can come in and court those global advertisers
Speaker 11: to come back to the platform.
Speaker 4: You were at Twitter twenty ninety twenty fourteen Corporate Social Innovation.
Speaker 3: At one point I think somebody.
Speaker 4: Called you the woman who got the Pope onto Twitter.
Speaker 4: What will they be calling Linda Yakarino. What kind of
Speaker 4: impact beyond just ad sales do you think she can
Speaker 4: do to help the platform?
Speaker 11: I think the potential here is pretty incredible. The first
Speaker 11: thing she's going to have to do is get back
Speaker 11: and court all those advertisers again, people she's worked with
Speaker 11: very closely over her long career at NBC Universal, And
Speaker 11: what she's going to have to convince them is that
Speaker 11: stability and security are back. And that's of course why
Speaker 11: advertisers left the platform, their concerns about stability and their
Speaker 11: concerns about security, the rise of hate speech, the reintroduction
Speaker 11: of a bunch of formerly banned accounts, and so that's
Speaker 11: going to be her first sort of step is to
Speaker 11: make sure advertisers feel safe and feel excited to use
Speaker 11: the platform again. And then beyond that, I think one
Speaker 11: of her biggest challenges is going to be looking at
Speaker 11: how she can accomplish all.
Speaker 6: This with a really reduced headcount.
Speaker 11: We know that at NBC right now she leads a
Speaker 11: team of about two thousand, which is about the size
Speaker 11: of Twitter as it is right now. But you know,
Speaker 11: Twitter is made up of a ton of engineers, and
Speaker 11: she's going to get She's going to require a media
Speaker 11: team and the need to sort of build that back
Speaker 11: up again, and that's going to be really interesting to
Speaker 11: see how she's able to do that on such limited numbers.
Speaker 6: Staff numbers.
Speaker 2: You point out the challenges here, and ultimately the way
Speaker 2: in which this has been announced, dare I say, is
Speaker 2: a complete mess. It is not how I would want
Speaker 2: to be taking on a new role, to have to
Speaker 2: exit like that, to have to enter like that. And
Speaker 2: many have said, and maybe I'm just seeing it more
Speaker 2: because I'm a woman, but they said, look, this is
Speaker 2: a so called sort of glass cliff. This is once
Speaker 2: again a diverse leader being handed a bit of a
Speaker 2: poison chalice here.
Speaker 6: It's super fascinating.
Speaker 11: So there's a study from some researchers at the University
Speaker 11: of Ethics and that's been sort of going viral on
Speaker 11: Twitter because it was republished in Harvard Business Review, And
Speaker 11: essentially it shows that in times of crisis, In times
Speaker 11: of crisis is in a business generally the markets prefer
Speaker 11: a leader who has stereotypically feminine or qualities of a woman, essentially,
Speaker 11: and yet when a business is sort of doing well,
Speaker 11: we tend to prefer the stereotypical qualities of a man.
Speaker 11: So it's not a surprise that if an extreme moment
Speaker 11: of necessary turnaround that Twitter requires right now, that they're
Speaker 11: going out and seeking a female leader. What we can
Speaker 11: hope is that she can turn this around and it
Speaker 11: won't just be sort of a failed experiment.
Speaker 3: Right.
Speaker 2: And it's interesting, of course that Elon Musk is going
Speaker 2: to the CTO role, so it feels as though the
Speaker 2: delineation is clear. He's very much going to be about
Speaker 2: innovation on the platform. She's going to be about how
Speaker 2: you sell it and bring safety back. Is that the way?
Speaker 2: Do you think that's a good allign It's a good
Speaker 2: way of splitting it.
Speaker 6: I think that's a good analysis.
Speaker 11: But I think I would highlight here that you know,
Speaker 11: this is a huge thing for him to acknowledge, right,
Speaker 11: I mean, the CEO is, for all intentsive purposes, in
Speaker 11: a management role.
Speaker 6: In charge of the CTO.
Speaker 11: And this is very different than the tune he was
Speaker 11: singing six months ago when he bought the platform, right
Speaker 11: that we're going to create a super app, that we're
Speaker 11: going to have payments, that we're going to do all
Speaker 11: these really exciting things that are going to require tons
Speaker 11: of in on the side of tech. And now he's saying, hey,
Speaker 11: you know, actually we need a CEO who really knows advertising,
Speaker 11: who really knows numbers, who really knows the business side
Speaker 11: of things. So I think it's a really fascinating turnaround
Speaker 11: and I can't wait to see what happens.
Speaker 4: I would also point out that he's going to the
Speaker 4: executive chair role, so he's kind of giving himself that
Speaker 4: position of oversight alongside CTO.
Speaker 3: It's interesting.
Speaker 4: I don't think Jack Dawsey was CEO when you were there.
Speaker 4: You were there two thousand, ninety twenty fourteen, and Jack
Speaker 4: Dorsey was technically CEO from twenty fifteen. But Jack was
Speaker 4: also criticized for sort of having this non CEO persona.
Speaker 4: He was not a pencil pushing executive. How did that
Speaker 4: dynamic work at the company? You know, how important is
Speaker 4: it to have somebody that's more technologically focused driving their
Speaker 4: platform like Twitter forward.
Speaker 11: Well, typically in Silicon Valley that's incredibly important, right from
Speaker 11: the perception of how you're hiring the most incredible staff
Speaker 11: and how you're raising venture dollars obviously not relevant right now.
Speaker 6: To Elon, that's super, super important.
Speaker 11: And so to be one of the largest tech companies
Speaker 11: out there and to have a CEO who is not
Speaker 11: technical is very interesting. And again I go back to
Speaker 11: why I think this is such an admission on the
Speaker 11: part of Elon that some of his experiments really didn't
Speaker 11: work and didn't work to such an extent that they've.
Speaker 6: Got to change up dramatically here.
Speaker 11: I think with this change, you're going to see a
Speaker 11: lot of going back to the way Twitter used to be,
Speaker 11: and that may be really challenging for Elon and he
Speaker 11: may really not like a lot of it. So, I mean,
Speaker 11: there's a lot to kind of wade through here.
Speaker 4: I just want to go back some of the reporting
Speaker 4: we talked about earlier in the show, which is that
Speaker 4: we reported in October when Elon brought back brought on
Speaker 4: private investors to the new entity, telling them that plan
Speaker 4: is to take this entity public again in a three
Speaker 4: to five year time horizon.
Speaker 3: So I find that interesting.
Speaker 4: I also find like what Twitter is interesting in Caro
Speaker 4: Taker Carlson the most recent example, So what we're going
Speaker 4: to have news shows based on Twitter now?
Speaker 2: Well, and that's what's so interesting. You'll hear a lot
Speaker 2: of news executives sort of always wanting to know when
Speaker 2: it's going to work in tandem with social media and
Speaker 2: clear to that point, is that still an area that
Speaker 2: you're interested in the fact that Tucker Carlson's going to
Speaker 2: go and build something almost bespoke for Twitter. It's about
Speaker 2: that seems to be more about the subscription side of things,
Speaker 2: because he's not a man that actually really managed to
Speaker 2: tantalize that many advertisers.
Speaker 11: I don't think he is a man that tatalizes many advertisers.
Speaker 11: I think that's accurate to say, yes, and then again,
Speaker 11: we're getting back to subscription side.
Speaker 6: So clearly Elon is.
Speaker 11: Not giving up his dreams of, you know, charging users
Speaker 11: to use the platform and have that to be a
Speaker 11: really big business, but he is acknowledging that, hey, ninety
Speaker 11: percent of revenue came directly from advertisers, and we need
Speaker 11: to at least get back a little bit to the
Speaker 11: way things used to be in order to keep Twitter
Speaker 11: more or less on an even keel. Although I don't
Speaker 11: think anyone could ever say Twitter is on an even
Speaker 11: keel right now.
Speaker 2: Well said kind of Perkins Lacy Scout, former Twitter executive
Speaker 2: playas is. It's great to have some time with you
Speaker 2: over there in Argentina.
Speaker 3: Ed, Yeah, I enjoyed that one. We covered a lot
Speaker 3: of ground.
Speaker 4: They're coming up AI's impact on customer service. We're going
Speaker 4: to scuss all that and more with nice CEO Barrack Elm.
Speaker 8: Next, this is Bloomberg, and what we're seeing today is
Speaker 8: a lot of AI tourists pretending to be AI natives.
Speaker 8: You know, there's a lot of companies who are not
Speaker 8: selling solutions. They're ultimately just selling vaporware.
Speaker 2: Alex talking toughly the CEO of SCALEAI when it calls
Speaker 2: AI tourists. Let's talked to more about the rise of
Speaker 2: generative AI at this moment. Some of the players that
Speaker 2: have been in the AI space more broadly for more
Speaker 2: than a hot second, like Nice Tech company that has
Speaker 2: been powering customer services for eighty five percent of the
Speaker 2: fortune one hundred companies with artificial intelligence. Nice CEO rag
Speaker 2: Iliam Elam is with us now. But it's interesting. You
Speaker 2: have twenty five thousand organizations more than one hundred and
Speaker 2: fifty countries. This is about customer experience and the use
Speaker 2: of AI. How have you been folding generative AI into
Speaker 2: that offering?
Speaker 9: So, you know, if you think about our space, we
Speaker 9: cater to thousands of organizations around the world that are
Speaker 9: serving consumers, and we operate in the space of customer service,
Speaker 9: and we have that platform of organization when it comes
Speaker 9: to provide service to customers. When you know what AI
Speaker 9: brings to the customer service ARAA, I feel back with
Speaker 9: the customer service domain is a true game changer because
Speaker 9: this industry has been struggling with three very important thing.
Speaker 9: First is you know, the lack of skilled labor, the
Speaker 9: ability to take decision in a very fast velocity, and
Speaker 9: mess personalization at scale. Yes, and that's exactly what AI
Speaker 9: can do to this industry. However, there is nothing generic,
Speaker 9: if you'd like, about what those organizations needs when it
Speaker 9: comes to AI. And this is exactly where we are
Speaker 9: and our company come into the picture.
Speaker 2: You're seeing growth of course, posting what twenty five percent
Speaker 2: in the cloud revenue part of the business growth, But
Speaker 2: are you worried about some of the competitors that are
Speaker 2: coming on the space. If everyone suddenly starts being an
Speaker 2: AI specialist, if everyone can suddenly start changing up a business.
Speaker 2: I mean, I think this week alone we've had IBM,
Speaker 2: what's the next, We've had slacked well slax owner salesforce
Speaker 2: talking about how they're having the GPT within some parts
Speaker 2: of their business. Everyone's now offering this to their customers.
Speaker 9: I would sell in the countrary. First of all, We
Speaker 9: reported our ERNIXT yesterday and as you said, we had
Speaker 9: an outstanding earnings with twenty five percent growth in the cloud,
Speaker 9: driven by both cloud and AI. But when it comes
Speaker 9: to AI, although you know we all experience so far,
Speaker 9: almost all of us experience the beauty of GENERATIVEI, when
Speaker 9: it comes to deploying it in customer service for organization,
Speaker 9: there is nothing generic about it. Actually, we see for
Speaker 9: our customers that are divided into two camps, those that
Speaker 9: says I will never put it in my customer service
Speaker 9: environment because it's not secured and I cannot control it,
Speaker 9: and the other that see the value but are concern
Speaker 9: about taking something that generic and try it and doesn't work.
Speaker 9: Because what you need you actually need to treat that
Speaker 9: AI as one of your employee and as a brand.
Speaker 9: You want the AI to serve your brand, your reputation,
Speaker 9: and meet your business goal. So it needs to be
Speaker 9: trained with a lot of information, information of tens of
Speaker 9: billions of pass interactions with customers, and it's a proprietor
Speaker 9: information that you don't want to provide to the generative AI,
Speaker 9: and that's why they come to us to our platform.
Speaker 9: We have I have done data that is extremely almost
Speaker 9: impossible to replicate given our history and the.
Speaker 3: Breadth of our offering.
Speaker 9: It's also both having it in a very secured environment
Speaker 9: and you have to the domain expertise, so it actually
Speaker 9: raises I would say, the bulio of entry when it
Speaker 9: comes to technology in the space of customer service.
Speaker 2: Gosh ed. It takes me back to the conversation we
Speaker 2: had a couple of months ago with Kathy Wood talking
Speaker 2: about it all being about the power of your proprietary data.
Speaker 2: But also, I mean that isn't to say though, that
Speaker 2: still everyone's coining a term or using and referencing AI,
Speaker 2: no matter what part of the industry or what kind
Speaker 2: of company you are.
Speaker 4: Right now, you make a really interesting point, both on
Speaker 4: proprietary data and referencing the term back.
Speaker 3: I have free time on my hands.
Speaker 4: So I went through every single one of your earnings
Speaker 4: transcripts for the last year seventy four. Mentioned AI in
Speaker 4: the earning school twenty four hours ago. In the same
Speaker 4: quarter a year ago sixteen mentioned to AI the quarter previous,
Speaker 4: Going back to the fourth quarter fifty eight, how much
Speaker 4: pressure are you under to talk a big game around AI.
Speaker 9: I don't think it's a matter of pressure. I think
Speaker 9: that we actually see it in our business. This is
Speaker 9: the type of discussions we have with our customers today.
Speaker 9: You know, our business up until several years ago was
Speaker 9: concentrated more on what we call the contact center, but
Speaker 9: all of a sudden, with AI, we actually covered the
Speaker 9: entire journey of the customer. And we spend the last
Speaker 9: several years deploying and building AI capabilities that are injected
Speaker 9: and infusing our platform, and it is today one of
Speaker 9: the things, one of the two things that are driving
Speaker 9: our business A is the shift to the cloud. That
Speaker 9: is still in the early innings in the customer service part,
Speaker 9: and even earlier than that is the AI. So actually
Speaker 9: we see it as the greatest opportunity we had for
Speaker 9: nights for our company since I remember, and I've been
Speaker 9: with the company for twenty.
Speaker 4: Five years, ROCKI did be on the on the top
Speaker 4: and bottom line. I just give us some guidance going
Speaker 4: forward the rest of this year. What does your customer
Speaker 4: base look like is their confidence to spend right now?
Speaker 3: So we had the.
Speaker 9: Beat both on top line and bottom line, as you've mentioned,
Speaker 9: and we raised the guidance for the for the rest
Speaker 9: of the year. You know, we operate in a space
Speaker 9: that even in this economy, enterprises understand. They see need
Speaker 9: to differentiate and protect their brand, elevate their brand, and
Speaker 9: of course providing out sending experiences to their customers. So
Speaker 9: we are a mission critical solution for them and they
Speaker 9: actually continue to invest and invest even significantly, and that's
Speaker 9: why we raised the guidance.
Speaker 7: For the year.
Speaker 4: Nice CEO name of the company, nice, nice guy to
Speaker 4: Nice CEO, Barack Eyelam, thank you, thank you very much.
Speaker 2: Let's just talk about the founder of SoftBank Group, Masayoshi
Speaker 2: san is now personal on the hook for about five
Speaker 2: point two billion dollars on side deals he set up
Speaker 2: at the company. That's after the company's a vision fund
Speaker 2: Bench Capital. Arm ended the fiscal year with a record
Speaker 2: thirty two billion dollar loss. It's the world's largest technology investor.
Speaker 2: Was look, he's been battered by losses of unlisted startups
Speaker 2: in his portfolio. However, there is one company that he's
Speaker 2: looking to list again. Let's think about how much SoftBank
Speaker 2: is coming. Measuring investor interest in an IPO of its
Speaker 2: chip maker arm Leanna Baker, Bloomberg News US Deal's managing
Speaker 2: editor is here with the details. Of course, the company
Speaker 2: that they took private, now they want to take public
Speaker 2: and what is the interest site for it?
Speaker 12: So it's funny that you mentioned that they were facing
Speaker 12: losses of thirty two billion, because that's almost what they
Speaker 12: spent on ARM back in twenty sixteen, and now it's
Speaker 12: time to cash out. You might remember that ARM tried
Speaker 12: to sell to Nvidia two years ago. That deal never happened,
Speaker 12: So this is really a chance for SoftBank to recoup
Speaker 12: some losses for the rest of their portfolio. And ARM
Speaker 12: right now could be worth anywhere from thirty billion to
Speaker 12: set and debillion. Since it's still early, we don't know
Speaker 12: where the valuation will come in. What we do know
Speaker 12: is that this IPO is likely going to be the
Speaker 12: biggest of the year, certainly the biggest in the tech space.
Speaker 4: It's interesting, I remember when we went through the Rivian
Speaker 4: IPO process in November twenty twenty one, which seems like
Speaker 4: a lifetime ago now, but you get big institutionals buying
Speaker 4: blocks of shares, there was demand. Do we have any
Speaker 4: guide of how interested those institutionals are for this one?
Speaker 12: So these are tests, the water meetings is what they're called.
Speaker 12: So these aren't, you know, a formal road show we're
Speaker 12: going to see those closer to after Labor Day when
Speaker 12: this IPO is looking to launch. So now these meetings
Speaker 12: are very early. They're just trying to get an indication
Speaker 12: of where we could see that valuation come in. I
Speaker 12: mentioned it's a huge range right now, so probably in
Speaker 12: the next few weeks, ARM will have some sense of
Speaker 12: where things are. But again it is early, and the
Speaker 12: IPO process has changed in the past few years. It
Speaker 12: used to be that these meetings didn't happen, but IPOs
Speaker 12: tend to run smoother when you bring an investors early.
Speaker 2: Many of those Brits still smarting about the fact that
Speaker 2: it's not going to be listening in London quite as
Speaker 2: soon as they hope. Lou mostly Ana Baker absolutely brilliant,
Speaker 2: Thank you so much for bringing us that. And interesting,
Speaker 2: isn't it ed As we talk about just the private
Speaker 2: valuations around AI. We talked to publicly traded companies thinking
Speaker 2: about AI, and then we think about companies that totally
Speaker 2: different but in the chip designing business that are looking
Speaker 2: at the list. It feels a more buoyant kind of
Speaker 2: conversation we're having at the moment.
Speaker 4: Yeah, like ARM is an AI adjacent company, the chips
Speaker 4: IT designs are at the cutting edge of technology. Will
Speaker 4: it be a player in AI? There is a thought
Speaker 4: school of thought that says yes. Look at the banks, Goldman, JP, Morgan, Barclay's.
Speaker 4: According to sources, what did Leanna say? A smooth IPOs
Speaker 4: what we're hoping for?
Speaker 7: M h.
Speaker 2: Well, We've got so much more to discuss. That's the
Speaker 2: end of this edition of Bloomberg Technology. But what's our next?
Speaker 12: Ed?
Speaker 4: Well, you can check out the podcast or join us
Speaker 4: on Twitter spaces right now on Twitter, do it.
Speaker 3: This is Bloomberg