WEBVTT - China Risks for Chips and Apple's Hollywood Ambitions 0:00:02.600 --> 0:00:11.640 Bloomberg Audio Studios, podcasts, radio news. 0:00:09.560 --> 0:00:13.240 From the Heart where Innovation, money and power Collie in 0:00:13.360 --> 0:00:14.800 Silicon Valley, nbon. 0:00:15.200 --> 0:00:19.480 This is Bloomberg Technology with Caroline Hyde and Ed lud Love. 0:00:33.240 --> 0:00:34.720 Live from New York and San Francisco. 0:00:34.920 --> 0:00:40.080 This is Bloomberg Technology coming up full chip coverage as TSMC. 0:00:39.720 --> 0:00:42.720 Earnings jump, but China risks remain for the sector. 0:00:43.520 --> 0:00:46.600 Plus Apple makes plans to license more Hollywood films for 0:00:46.680 --> 0:00:47.520 its streaming push. 0:00:47.680 --> 0:00:50.120 And Bloomberg Intelligence breaks down the odds of a TikTok 0:00:50.159 --> 0:00:52.040 van under a Trump presidency. 0:00:52.440 --> 0:00:53.880 Who bring you all the details? 0:00:54.000 --> 0:00:56.560 We want to talk about the China risks with the 0:00:56.560 --> 0:00:59.480 Biden administration as he's mentioned, and really considering more trade 0:00:59.480 --> 0:01:03.840 restrictions Bloomberg Intelligence, and with a note saying this along 0:01:03.920 --> 0:01:07.039 with Donald Trump's own comments on defending Taiwan or not 0:01:07.080 --> 0:01:10.040 defending them earlier this week in a Bloomberg Business Week interview, 0:01:10.400 --> 0:01:14.639 could be quote beneficial for regional manufacturers in the US. 0:01:14.840 --> 0:01:19.600 I'm talking Intel, Global Founderies, Micron, Bloomberg Intelligence analysts cringe 0:01:19.640 --> 0:01:23.000 and Savanni's with us. You altered the note and just 0:01:23.040 --> 0:01:26.240 dissect for us a moment how much geopolitical risks do 0:01:26.240 --> 0:01:28.840 you think there is affecting some of these names that 0:01:28.920 --> 0:01:30.440 do have exposure to China. 0:01:31.760 --> 0:01:34.119 Yeah, at this point, it's more of a headline risk 0:01:34.240 --> 0:01:37.679 rather than a fundamental risk. Right, It's speculative at best, 0:01:37.720 --> 0:01:40.840 so we don't know how much to quantify, but for context, 0:01:40.880 --> 0:01:44.920 it's important to understand the run that socks has had. 0:01:45.040 --> 0:01:48.960 Right especially these high flying AI names. It seems like 0:01:49.120 --> 0:01:52.720 almost nothing but positivity has been priced in. So I 0:01:52.760 --> 0:01:56.200 think this sort of any sort of roadblock, even if 0:01:56.280 --> 0:01:59.320 not quantifiable, sort of seems like a good opportunity for 0:01:59.360 --> 0:02:01.960 folks to lock in their profits and sort of the 0:02:02.000 --> 0:02:05.800 valuations to take a breeder. Beyond that, the China risks 0:02:05.840 --> 0:02:07.920 have been there for the last two years. We have 0:02:07.960 --> 0:02:11.760 seen sanctions getting increased over time, but when you look 0:02:11.800 --> 0:02:15.040 at impact in terms of fundamentals and revenues, it's mainly 0:02:15.080 --> 0:02:17.440 been one or two key large players that have seen 0:02:17.440 --> 0:02:20.680 the impact. So again, the response to this news, with 0:02:20.840 --> 0:02:24.280 the most of the sector reacting like that, seems more 0:02:24.280 --> 0:02:25.519 of a again, headline risk. 0:02:25.560 --> 0:02:26.200 At this part. 0:02:27.360 --> 0:02:30.040 You notice in your research that these are headwinds for 0:02:30.200 --> 0:02:33.240 fab less names. But the other name you linger on 0:02:33.320 --> 0:02:35.800 is of course Intel, and I think yesterday in the program, 0:02:35.880 --> 0:02:38.679 we were trying to understand the logic here. Intel is 0:02:38.720 --> 0:02:42.000 trying to grow its own business of being a contract 0:02:42.000 --> 0:02:46.280 manufacturer for third parties. If something happens politically or in China, 0:02:46.400 --> 0:02:51.679 in Taiwan, is Intel the only alternative, the only name 0:02:51.720 --> 0:02:54.040 that would benefit directly in that line of business. 0:02:54.040 --> 0:02:57.600 Congen So you if to divide the manufacturing world into 0:02:57.720 --> 0:03:01.000 the leading edge, which is really where they're chips and 0:03:01.040 --> 0:03:04.080 smartphone and TC chips get manufactured, and the lagging edge. 0:03:05.040 --> 0:03:08.480 You know, in the leading edge, there's really tree names 0:03:08.520 --> 0:03:13.280 that come to top TSMC, Samsung and in Intel, and Intel's 0:03:13.320 --> 0:03:16.560 main push has been tatered around to really leverage this 0:03:16.680 --> 0:03:19.040 risk point that hey, if something were to happen in 0:03:19.080 --> 0:03:22.799 Taiwan or TSMC, we would be sort of your insourcing 0:03:23.440 --> 0:03:26.840 champion here in the US. So definitely, you know, such 0:03:26.960 --> 0:03:30.280 news do benefit them. Again, this is not something quick. 0:03:30.400 --> 0:03:33.240 You cannot turn off TSMC tonight and turn on and 0:03:33.280 --> 0:03:35.520 take all the capacity at Intel. But in the long 0:03:35.600 --> 0:03:39.120 term still increases you know, if in your risk models 0:03:39.240 --> 0:03:43.080 still makes you favor regional manufacturers like Intel in global foundry, 0:03:43.240 --> 0:03:45.520 and speaking of the lagging edge, I think we have 0:03:45.600 --> 0:03:48.080 a lot more options in that area because a lot 0:03:48.120 --> 0:03:52.360 of US integrated device manufacturers have their own lagging edge capacity, 0:03:52.600 --> 0:03:55.440 so there's less reliance on Taiwan in that end, But yes, 0:03:55.440 --> 0:03:58.680 in the leading edge intel in terms of US and Europe. 0:03:59.120 --> 0:04:01.440 I asked that question because for the second time this week, 0:04:01.560 --> 0:04:04.240 intels up more than five percent in a session where 0:04:04.600 --> 0:04:07.160 some of the other names TSMC being one are under pressure. 0:04:07.200 --> 0:04:10.760 Bloomberg Intelligence analyst Kunjan Savanni, thank you. Let's bring in 0:04:10.800 --> 0:04:14.240 Amy Sellko, now principal analyst at Albright Stonebridge Group, and 0:04:14.320 --> 0:04:18.240 let's discuss the impact of potential trade cubs, expansion of 0:04:18.279 --> 0:04:22.000 trade cubs, and Trump on Chinese American relations. I mean, Amy, 0:04:22.400 --> 0:04:26.000 the chip sector is absolutely in focus right now. Just 0:04:26.080 --> 0:04:29.080 respond to what you heard from Kunjendre on their thesis 0:04:29.240 --> 0:04:33.039 on geopolitics and who may or may not benefit in 0:04:33.080 --> 0:04:34.120 a Trump presidency. 0:04:35.400 --> 0:04:39.279 Well, I think it is really early to say, and 0:04:39.320 --> 0:04:42.720 I think that's why we're seeing so much volatility because 0:04:43.200 --> 0:04:45.920 while we have a sense from Trump himself, from his 0:04:46.080 --> 0:04:49.960 vice president, from his top advisors how he looks at 0:04:50.080 --> 0:04:54.839 competition with China, the prescriptions that he will use really 0:04:54.960 --> 0:04:58.520 are unclear to date, based on what the Biden administration 0:04:58.720 --> 0:05:02.360 is doing. We are seeing the potential for more curves 0:05:02.720 --> 0:05:09.040 on American and non American semiconductor products, particularly hardware, going 0:05:09.080 --> 0:05:14.040 to support China in increasing its focus on technology self 0:05:14.040 --> 0:05:17.680 reliance a key theme coming out of the Third Planum. 0:05:18.000 --> 0:05:20.359 That is what we're hearing that Shi Jinping is saying. 0:05:20.400 --> 0:05:24.680 We need more indigenous innovation. We need technology to help 0:05:24.760 --> 0:05:28.919 us build our own semiconductor industry because we cannot rely 0:05:29.400 --> 0:05:34.719 on an uncertain geopolitical landscape, given uncertainty in the United 0:05:34.720 --> 0:05:38.640 States and in Europe to key suppliers and of course 0:05:38.720 --> 0:05:43.000 Japan of this technology hardware to China. As a result 0:05:43.040 --> 0:05:48.919 of that, of course, American, European, Japanese hardware providers of 0:05:49.040 --> 0:05:56.920 China's semiconductor global semiconductor manufacturing are being pressured to restrict 0:05:57.040 --> 0:05:59.799 what they are going to continue to sell and service 0:05:59.839 --> 0:06:03.279 in China. That's where so much of this uncertainty is 0:06:03.320 --> 0:06:07.159 because the question of how what are the restrictions. Will 0:06:07.200 --> 0:06:11.039 the United States be successful in negotiating with the Dutch, 0:06:11.160 --> 0:06:15.360 with the Japanese governments to really expand restrictions on what 0:06:15.440 --> 0:06:17.520 can be provided to China is the key. 0:06:18.400 --> 0:06:21.880 How much do you believe that the threats will become reality. 0:06:22.120 --> 0:06:23.839 How much do you think that the Dutch and the 0:06:23.920 --> 0:06:28.680 Japanese will curtailed servicing technology that already exists in China. 0:06:29.720 --> 0:06:31.960 Well, I think there's going to continue, of course, to 0:06:32.000 --> 0:06:37.800 be American industry pressure that not they alone face those restrictions, 0:06:37.839 --> 0:06:41.240 Caroline and so. While of course US industry doesn't want 0:06:41.279 --> 0:06:43.400 to see more restrictions on what they can sell to 0:06:43.480 --> 0:06:46.800 China if there is not a direct national security concern, 0:06:47.520 --> 0:06:52.800 they right now are unfairly competing against Japanese and Dutch 0:06:52.839 --> 0:06:56.440 companies that are continuing to sell to China, and so yes, 0:06:56.560 --> 0:06:58.800 I do think that there's going to be more pressure 0:06:59.440 --> 0:07:03.000 to expand those restrictions. I do not think what we 0:07:03.000 --> 0:07:05.800 were rumored to be hearing about that there was going 0:07:05.880 --> 0:07:10.600 to be a massive expansion is going to come into place, 0:07:10.640 --> 0:07:13.080 certainly not in the Biden administration. I think there will 0:07:13.120 --> 0:07:17.960 be incremental steps to restrict certain companies in China from 0:07:18.000 --> 0:07:25.560 receiving from receiving more semiconductor hardware products in the near term. 0:07:25.720 --> 0:07:28.480 The Trump administration, which is what we are talking about here, 0:07:28.880 --> 0:07:31.160 is the big unknown amy. 0:07:31.520 --> 0:07:35.160 It takes two to tango right, and you don't have 0:07:35.200 --> 0:07:38.120 a crystal ball. But if you take the EV industry 0:07:38.160 --> 0:07:42.000 as a parallel example, what China did was give large 0:07:42.080 --> 0:07:45.680 volume subsidy, but it had a limited shelf life. Do 0:07:45.720 --> 0:07:48.240 you recognize a sort of willingness from the Chinese government 0:07:48.320 --> 0:07:52.400 to sort of fund their response to any sort of 0:07:52.400 --> 0:07:57.640 political or geopolitical policy that either administration comes with in November? 0:07:58.960 --> 0:08:00.520 Yeah, I think that's the key key point. 0:08:00.640 --> 0:08:03.800 I think the Dutch and the Japanese are very concerned, 0:08:03.840 --> 0:08:06.840 not just for their companies that are providing the technology 0:08:06.840 --> 0:08:09.960 hardware to China, were they to be restricted, It's not 0:08:10.000 --> 0:08:12.160 just their profits, it's China's retaliation. 0:08:12.680 --> 0:08:13.960 I think Shi Jinping. 0:08:13.720 --> 0:08:19.040 Has been extremely clear that if a stranglehold on certain 0:08:19.840 --> 0:08:24.560 high tech products and services continues visa via China market, 0:08:24.680 --> 0:08:26.760 he is going to respond. He is not, as he 0:08:26.800 --> 0:08:30.240 has said, going to sit idly by and watch those 0:08:30.320 --> 0:08:34.400 restrictions continue to expand. And so the Dutch, the Japanese 0:08:34.720 --> 0:08:37.800 and the US government have to think long and hard 0:08:37.960 --> 0:08:42.520 on the kinds of retaliatory tools China has available right now. 0:08:42.600 --> 0:08:48.200 For example, sport restrictions on graphite caroline to Japan, something 0:08:48.559 --> 0:08:52.040 Japanese industry desperately needs. My final point, though, would be 0:08:52.480 --> 0:08:56.080 China has to weigh its retaliation to make sure the 0:08:56.160 --> 0:09:01.480 retaliatory moves don't harm further and all ready very very 0:09:01.559 --> 0:09:05.360 shaky economy in China, well said at the leftfidge it 0:09:05.480 --> 0:09:06.520 had a few years ago. 0:09:06.679 --> 0:09:10.439 You advise corporates, you advise nonprofit clients at the moment, 0:09:10.520 --> 0:09:11.679 ultimately about. 0:09:12.080 --> 0:09:13.520 Business and policy interests. 0:09:13.960 --> 0:09:17.040 Can you advise us in our audience about Taiwan about 0:09:17.040 --> 0:09:19.760 some of the sentiment that seemed to be displayed by 0:09:19.800 --> 0:09:23.160 an interview of being by BusinessWeek with former President Trump 0:09:23.240 --> 0:09:26.400 that maybe they wouldn't come to Taiwan's aid. What does 0:09:26.440 --> 0:09:28.160 that mean for TSMC and for Taiwan. 0:09:29.800 --> 0:09:33.720 Well, obviously the silence coming from Taiwan is deafening. 0:09:33.800 --> 0:09:34.040 Here. 0:09:34.200 --> 0:09:42.240 They are not responding todent former President Trump's Bloomberg interview there. Instead, 0:09:42.320 --> 0:09:47.000 they're choosing to stand by what the platform of the 0:09:47.000 --> 0:09:51.720 Republican Party traditionally has been, which is to include Taiwan 0:09:51.840 --> 0:09:54.520 in it and to say that, of course, the United 0:09:54.520 --> 0:10:00.520 States and Taiwan have a legislatively mandated very strong relatedationship 0:10:01.280 --> 0:10:05.680 that does include US provisions to come to Taiwan's aid. 0:10:06.080 --> 0:10:08.280 Of course, it's up to the commander in chief. So 0:10:09.080 --> 0:10:13.480 Taiwan authorities must be worried, but I will say the 0:10:13.600 --> 0:10:18.400 worry is probably not severe right now because most of 0:10:18.440 --> 0:10:22.960 the advisors around President Trump, including his selection of vice 0:10:23.000 --> 0:10:28.000 presidential candidate with JD. Vans, are very strong supporters of Taiwan, 0:10:28.520 --> 0:10:32.000 and so within a Trump two administration were that to 0:10:32.080 --> 0:10:35.680 come to pass, there are going to be very significant 0:10:35.720 --> 0:10:40.920 conversations around how the United States continues to focus more 0:10:41.160 --> 0:10:44.160 on Asia than Europe, which is clearly a platform that 0:10:44.200 --> 0:10:46.880 we're starting to hear coming out of the Republican Convention, 0:10:47.600 --> 0:10:50.120 and what that means for US policy towards Taiwan. 0:10:50.200 --> 0:10:51.000 So I wouldn't be. 0:10:51.280 --> 0:10:54.600 So quick to conclude that President Trump is going to 0:10:54.640 --> 0:10:57.800 abandon Taiwan in the event of some kind of conflict 0:10:58.120 --> 0:11:02.320 that would really be going against traditional US policy, particularly 0:11:02.360 --> 0:11:03.480 among the Republicans. 0:11:04.120 --> 0:11:06.920 Amy so important to have your expertise. We thank you, 0:11:06.960 --> 0:11:09.800 Amy Seller, co principle analyst at All bright Stonebridge Group. 0:11:10.200 --> 0:11:11.120 We thank you, Ed. 0:11:11.640 --> 0:11:14.320 What's so interesting is we see this volatility in the 0:11:14.360 --> 0:11:17.720 individual stocks today as we question ultimately some of the 0:11:17.760 --> 0:11:20.320 valuations where we've run to in the videos. 0:11:19.960 --> 0:11:20.400 And the like. 0:11:21.360 --> 0:11:23.360 Yeah, I think what's so astonishing about the conversation. We 0:11:23.520 --> 0:11:26.480 just had detail, but we didn't even discuss about another factor, 0:11:26.920 --> 0:11:30.240 which is the AI driven boom right growth driven by 0:11:30.280 --> 0:11:35.280 demand for AI accelerator manufacturing TSMC has clients everywhere, and 0:11:35.360 --> 0:11:38.280 so I just wonder how maybe we'll talk to Jensen 0:11:38.320 --> 0:11:40.240 about it in a few weeks time. But it's like 0:11:40.800 --> 0:11:43.800 geopolitics takes away one market. There are plenty waiting the 0:11:43.840 --> 0:11:46.440 wings to get some capacity, and I just thought it 0:11:46.480 --> 0:11:48.160 was weird that we're right bring that up. 0:11:48.400 --> 0:11:53.120 But then Goldman Sachs's top research analyst today currently saying, 0:11:53.520 --> 0:11:56.360 maybe you need to question the ultimate demand of AI 0:11:56.520 --> 0:11:59.160 in the longer term. Will it really drive this productivity 0:11:59.200 --> 0:12:03.320 group story on Jim Cavolo from some of our colleagues 0:12:03.360 --> 0:12:04.280 in Bloomberg News today. 0:12:04.280 --> 0:12:06.360 Meanwhile, coming up, Apple we know is in. 0:12:06.320 --> 0:12:09.440 Talks to license more films from major Hollywood studios. 0:12:09.559 --> 0:12:11.960 Look, it's an effort to bolsterous Apple TV plus streaming 0:12:12.000 --> 0:12:15.240 service being reported by Bloomberg. Stick with us. This is 0:12:15.240 --> 0:12:31.839 Bloomberg Technology Media News now. 0:12:31.840 --> 0:12:35.040 Bloomberg reporting that Apple is in talks with several major 0:12:35.080 --> 0:12:38.560 Hollywood studios about acquiring more films for their Apple Plus 0:12:38.600 --> 0:12:42.880 streaming service, which currently features almost entirely original production. There's 0:12:42.880 --> 0:12:45.680 a lot going on in Hollywood. Chris Paul Mary breaks 0:12:45.720 --> 0:12:47.680 it down for us. Let's just start on the Apple 0:12:47.760 --> 0:12:50.600 news for now. Who would they be garnering from? Is 0:12:50.640 --> 0:12:52.720 it like relief for some of those studios right now? 0:12:53.600 --> 0:12:56.400 We didn't report the exact names, but you know, you 0:12:56.440 --> 0:12:59.600 can imagine sort of all the all the big folks 0:12:59.679 --> 0:13:04.680 in the entertainment business, whether it's you know, Universal, Warner Brothers, Comcast, Disney, 0:13:06.200 --> 0:13:08.760 all of those players, and what's going on here is 0:13:08.760 --> 0:13:12.080 is Apple TV originally had a strategy to focus really 0:13:12.440 --> 0:13:15.640 on high quality original programming. You know, it's had some, 0:13:16.160 --> 0:13:21.080 for sure hits, Ted Lasso The Morning Show, but it's 0:13:21.320 --> 0:13:24.160 not as watched as some of the other big players 0:13:24.280 --> 0:13:27.960 in the industry, and in particular they're film Slate. You know, 0:13:28.000 --> 0:13:31.480 they made a big billion dollar commitment to make original 0:13:31.480 --> 0:13:33.720 movies and to put them at least the first in 0:13:33.760 --> 0:13:38.520 theaters as well. Hollywood applauded. But you know they've had 0:13:38.640 --> 0:13:41.000 more than their share of Dud's our Guyle big action 0:13:41.120 --> 0:13:44.040 movie two hundred million dollars. It's one I just saw 0:13:44.080 --> 0:13:47.600 this weekend, fly Me to the Moon. Nice movie, but 0:13:47.920 --> 0:13:52.000 you know, not really burning it up. So this is 0:13:52.000 --> 0:13:54.720 a shift in strategy to try to get more library 0:13:54.720 --> 0:13:58.120 content on there and and build the audience for Apple TV. 0:13:59.120 --> 0:14:03.480 That's probably, Chris, what Netflix has, right. You know, I 0:14:03.520 --> 0:14:06.240 was actually watching World of Warcraft the other day on Netflix, 0:14:06.240 --> 0:14:09.080 which is a twenty sixteen film. I won't give my 0:14:09.200 --> 0:14:11.720 review of it, but that's where you go to, right. 0:14:11.840 --> 0:14:16.280 Netflix has this sort of endless catalog. How much volume 0:14:16.320 --> 0:14:18.280 dollar wise is Apple going to have to put into 0:14:18.320 --> 0:14:19.920 this to like fight back? 0:14:21.000 --> 0:14:24.880 Numbers on Apple's are scarce to come by some of 0:14:24.880 --> 0:14:26.600 the other operators, but. 0:14:28.120 --> 0:14:29.640 We're seeing this across the industry. 0:14:29.640 --> 0:14:32.000 We're seeing both There was originally the theory was all 0:14:32.000 --> 0:14:34.280 these streaming services going to have walled gardens in their 0:14:34.320 --> 0:14:37.320 own content and it wasn't going to be sold elsewhere, 0:14:37.320 --> 0:14:40.640 And that's completely broken down. Now we have shows on 0:14:40.720 --> 0:14:45.560 multiple streaming services TV outlets. In a way, it makes 0:14:45.560 --> 0:14:48.840 it easier for consumers to find stuff, but it just 0:14:49.160 --> 0:14:53.280 it does devalue away the exclusivity of the programming. 0:14:53.480 --> 0:14:58.120 Yeah, what continues to hurt is legacy TV. Chris, And 0:14:58.200 --> 0:15:01.200 you're out with some of that ft reporting today that 0:15:01.360 --> 0:15:05.000 maybe Warner Brothers, Discovery and David saslav Over at the 0:15:05.000 --> 0:15:08.240 company are thinking of splitting up studios streaming from the 0:15:08.320 --> 0:15:09.000 legacy TV. 0:15:09.120 --> 0:15:13.120 Why well, first of all, there's stock prices just in 0:15:13.200 --> 0:15:15.600 the dumps, just a real terrible performer. 0:15:16.440 --> 0:15:16.680 Either. 0:15:16.680 --> 0:15:19.640 They put these two companies together, Warner Brothers in Discovery 0:15:19.800 --> 0:15:22.720 with these big plans to really beef up the max 0:15:22.760 --> 0:15:25.240 streaming beef's business. 0:15:24.480 --> 0:15:26.560 And it just hasn't worked. 0:15:26.760 --> 0:15:30.040 And David Szaz left the CEOs sort of acknowledged that 0:15:30.160 --> 0:15:34.280 this month at Sun Valley he said that the industry's 0:15:34.320 --> 0:15:38.240 fisting to need more consolidation. Now, whether this particular split 0:15:38.320 --> 0:15:40.640 up is the way to do that getting a lot 0:15:40.680 --> 0:15:44.600 of skepticism from analysts or the problem is that the 0:15:44.640 --> 0:15:49.040 traditional TV networks, although they're declining and we're talking about you, TNT, 0:15:49.280 --> 0:15:52.920 CNN and that, are still the cash generators, and the 0:15:52.960 --> 0:15:55.840 studio and the streaming business aren't making as much money 0:15:55.840 --> 0:15:59.200 and need the money to invest in new programming. So 0:15:59.760 --> 0:16:02.760 with forty billion or so in debt on the books, 0:16:02.800 --> 0:16:06.360 how that's going to rationalize itself is very difficult to 0:16:07.000 --> 0:16:09.000 figure out, and that that's why analysts are. 0:16:08.880 --> 0:16:11.600 Skeptical that this is the route. But I think the 0:16:11.680 --> 0:16:12.440 stock is up. 0:16:12.360 --> 0:16:16.000 Because people are applauding that the company recognized that it 0:16:16.040 --> 0:16:17.280 needs to do something different. 0:16:18.760 --> 0:16:21.280 One fors us love to think about bloom Best Chris Palm, Mary, 0:16:21.360 --> 0:16:22.160 thank you very much. 0:16:30.280 --> 0:16:31.400 Time now for talking tech. 0:16:31.480 --> 0:16:35.040 First up, Publicis It raises its guidance. The advertising agency 0:16:35.040 --> 0:16:37.560 posted stronger growth in the first half as He's net 0:16:37.600 --> 0:16:40.080 revenue growing by five to six percent this year, up 0:16:40.080 --> 0:16:42.240 from four to five percent previously. But the company is 0:16:42.240 --> 0:16:44.760 announced earlier this year that it would attempt to strengthen 0:16:44.800 --> 0:16:48.520 its data analysis and artificial intelligence capabilities as in an 0:16:48.520 --> 0:16:52.840 effort to combat the slump in the advertising industry. Meanwhile, 0:16:52.840 --> 0:16:56.000 India's Emphasis also raising its sales forecast for the year. 0:16:56.040 --> 0:16:57.920 Now the company expects revenue to grow three to four 0:16:57.960 --> 0:17:01.080 percent on a constant currency basis in the fiscal year 0:17:01.160 --> 0:17:03.680 through March twenty twenty five. Because a sign that clients 0:17:03.680 --> 0:17:06.960 are gradually increasing tech spend, Who's to buy a resilient 0:17:06.960 --> 0:17:11.960 global economy. The battle for potential ether ETF assets is 0:17:12.000 --> 0:17:14.040 already on the way. Even as the funds have yet 0:17:14.080 --> 0:17:16.879 to launch issuers, including the Black Crocs, Fidelity, and Vesco, 0:17:17.119 --> 0:17:20.159 they're already coming forward with how much or how little 0:17:20.400 --> 0:17:23.080 they're going to charge their respective ether ETF said. 0:17:23.920 --> 0:17:26.359 Okay, let's dive more into that with Bloomberg's Isabelle Lee, 0:17:26.400 --> 0:17:28.919 who's one of the bylines on our reporting about it 0:17:28.960 --> 0:17:32.120 this morning. It ranges from zero point two percent fee 0:17:32.200 --> 0:17:34.040 to two and a half percent fee on the gray 0:17:34.040 --> 0:17:38.600 scale ethereum trust, but that one has no conditions attached 0:17:38.640 --> 0:17:41.760 to it. Essentially, what does all that mean? What does 0:17:41.760 --> 0:17:42.960 that tell you, Isabelle? 0:17:43.240 --> 0:17:45.119 So this few r has been really going on for 0:17:45.119 --> 0:17:48.199 a while in this highly competitive space because theoretically, the 0:17:48.280 --> 0:17:51.000 lower your fee, the more attractive it will be to issuers. 0:17:51.000 --> 0:17:54.359 And yesterday was important because a lot of issuers filed 0:17:54.359 --> 0:17:56.119 what they call an S one and that revealed the 0:17:56.160 --> 0:17:57.879 feast and we went through all of them and the 0:17:57.920 --> 0:18:01.200 face range from nineteen basis points to twenty for contact. 0:18:01.240 --> 0:18:03.640 That is very cheap. They're cheap, as some would call it. Yes, 0:18:03.720 --> 0:18:06.600 Grayscale is on the higher end at around two and 0:18:06.600 --> 0:18:09.120 a half percent, but that's an exception because they're trying 0:18:09.160 --> 0:18:12.120 to launch or to convert their trust into an ETF. 0:18:12.160 --> 0:18:14.920 But all that to say, these funds are really priced 0:18:14.920 --> 0:18:16.639 at such a low fee, and in fact a lot 0:18:16.680 --> 0:18:19.359 of them have conditions. For instance, black Rock will have 0:18:19.440 --> 0:18:21.720 a partial waiver in the first year. Several said that 0:18:21.760 --> 0:18:23.800 in the first six months it'll be free. And I 0:18:23.840 --> 0:18:27.119 think issuers really learned their lesson because during the Bitcoin 0:18:27.200 --> 0:18:30.440 ETF a lot of them really just lowered and lowered 0:18:30.440 --> 0:18:32.960 as each day passed and even canceled leading up to 0:18:33.000 --> 0:18:35.040 the launch. But for now, in the first get go 0:18:35.359 --> 0:18:36.280 they were already cheap. 0:18:37.359 --> 0:18:38.600 I mean, I don't know if they did learn the 0:18:38.680 --> 0:18:41.920 lesson because they're really cheap again the waiving fees. 0:18:42.000 --> 0:18:44.639 They're saying you can be free for six months, but 0:18:44.720 --> 0:18:48.439 what pats are also anticipating is ultimately less inflows this 0:18:48.560 --> 0:18:51.040 time round. The problem with eth is that you could 0:18:51.080 --> 0:18:53.040 stake it if you're not putting in an ETF, and 0:18:53.080 --> 0:18:54.600 therefore that's an opportunity cost. 0:18:54.520 --> 0:18:57.160 Right Exactly, we have City Group expecting four to five 0:18:57.200 --> 0:18:59.399 billion launch for the first six months in inflows and 0:18:59.440 --> 0:19:02.600 for Contact black Rock, so that's only one ETF called 0:19:02.640 --> 0:19:04.880 in one billion in the first four days and as 0:19:04.880 --> 0:19:07.080 a whole now it's been seven months, but then we 0:19:07.160 --> 0:19:09.840 can see sixteen billion in total for the cohorts, so 0:19:09.880 --> 0:19:12.560 it's really a weak demand. And to your point, why 0:19:12.560 --> 0:19:14.800 would you buy an ether ETF. So that's really it's 0:19:14.960 --> 0:19:17.320 kind of a harder sell because for a bitcoin, yes 0:19:17.400 --> 0:19:20.000 it's digital gold, hedge, cans inflation, you buy it. But 0:19:20.040 --> 0:19:22.919 for Ether, the participants really want it for staking, so 0:19:23.480 --> 0:19:25.520 having it in a trust and the fund is really 0:19:25.880 --> 0:19:28.720 a little questionable for others, so the demand is less. 0:19:28.760 --> 0:19:31.160 And also those who want crypto exposure, the big Wall 0:19:31.160 --> 0:19:34.000 Street firms already got it in January, and it's a bitcoin. 0:19:34.040 --> 0:19:35.800 It's the biggest coin, it's the most stable, it's the 0:19:35.840 --> 0:19:39.200 most established, So why had your bets on something smaller? 0:19:39.400 --> 0:19:41.880 Although as thing to think about is Ether is kind 0:19:41.880 --> 0:19:44.639 of the leader of the alt coin world, so this 0:19:44.800 --> 0:19:47.600 may pave the way for smaller alt coins. Who knows, 0:19:47.800 --> 0:19:49.679 we'll already have Solona filing. 0:19:49.800 --> 0:19:53.480 So yeah, this was questioning around Solona, and ultimately the 0:19:53.560 --> 0:19:55.240 question around Selana is because. 0:19:55.119 --> 0:19:56.840 What's the SEC view it as? 0:19:57.080 --> 0:19:58.920 And I think this is the issue with the staking, 0:19:59.000 --> 0:20:01.840 right is the SEC it's just not comfortable that it 0:20:01.960 --> 0:20:05.520 ultimately isn't a security if you're able to put it 0:20:05.560 --> 0:20:08.240 aside and raise funds and yield on it. 0:20:08.520 --> 0:20:10.800 A lot of issuers already made concessions they were removed 0:20:10.800 --> 0:20:14.040 Staking because this racisn't do a question is Ether security, 0:20:14.119 --> 0:20:17.080 So they really had to compromise on a lot of things. 0:20:17.080 --> 0:20:19.600 But then if you still ask the Ether boss, they're 0:20:19.640 --> 0:20:22.240 just happy, said there's going to be an ETF out there. It's, 0:20:22.280 --> 0:20:25.600 you know, a major milestone in the crypto industry, second milestone. 0:20:25.880 --> 0:20:28.040 So there are pros and cons of it. 0:20:28.040 --> 0:20:31.680 But it's definitely a landmark if you will think about it. 0:20:31.760 --> 0:20:33.520 Slowly but surely, yes, us. 0:20:33.400 --> 0:20:36.240 Catching up with Europe and giving access to these sorts 0:20:36.240 --> 0:20:39.640 of Canada and Canada, Well said Isabel Lee, with all 0:20:39.680 --> 0:20:41.560 the take as we look towards what could be of 0:20:41.600 --> 0:20:44.800 course that eth ETF going live as soon as well 0:20:44.840 --> 0:20:45.920 Tuesday next weekend. 0:20:54.000 --> 0:20:55.320 Welcome back to bluemog Technology. 0:20:55.359 --> 0:20:57.959 I'm Caroline Hyde in New York and I made Ludlow 0:20:58.000 --> 0:20:58.840 in San Francisco. 0:20:59.160 --> 0:20:59.840 Look, what is the. 0:21:00.080 --> 0:21:04.480 Ability now of a TikTok ban if Donald Trump wins 0:21:04.520 --> 0:21:05.760 the White House in November. 0:21:06.080 --> 0:21:08.120 Well, some analysis have been done by Bloomberg. 0:21:07.680 --> 0:21:10.480 Intelligence crunching those numbers in its latest report. And I'm 0:21:10.480 --> 0:21:12.800 pleased to say we're joined by Senior Technology and as 0:21:12.840 --> 0:21:15.800 Mandate seeingh who sort of went through the tea leaves 0:21:15.840 --> 0:21:18.280 of what was being written in the Bloomberg BusinessWeek story 0:21:18.280 --> 0:21:22.719 that interview with President Trump former president, and ultimately it 0:21:22.760 --> 0:21:25.320 feels as though maybe he's less against TikTok, but because 0:21:25.359 --> 0:21:27.400 of Meta and because of US companies. 0:21:27.680 --> 0:21:31.359 Yes, And look, his views are pretty clear, even though 0:21:31.400 --> 0:21:33.480 they have changed since the time he was in the 0:21:33.520 --> 0:21:35.880 White House to where they are now. But at least 0:21:35.880 --> 0:21:37.919 he has said it clearly that he doesn't want to 0:21:37.960 --> 0:21:41.719 ban TikTok, and because his ratings have gone up. I mean, 0:21:41.760 --> 0:21:44.240 we are in an environment where, you know, every day 0:21:44.320 --> 0:21:47.840 the poll ratings are changing, and I think right now 0:21:47.840 --> 0:21:50.720 the market is behaving as if Trump was to get 0:21:50.720 --> 0:21:53.879 elected and he is against the band, even though the 0:21:54.000 --> 0:21:57.000 law has been passed that TikTok needs to get divested 0:21:57.680 --> 0:21:59.760 within the next one year or it will be banned. 0:21:59.800 --> 0:22:03.480 So clearly the market is saying otherwise because Meta has 0:22:03.520 --> 0:22:06.439 gone down, Snapchat has gone down, and the stocks have 0:22:06.520 --> 0:22:09.680