WEBVTT - Look Ahead to Alphabet and Microsoft Earnings 0:00:00.880 --> 0:00:05.199 From Marhart where Innovation, Money and power Collie in Silicon 0:00:05.280 --> 0:00:09.720 Vallet NBN. This is Bloomberg Technology with Caroline Hyde and 0:00:09.960 --> 0:00:10.560 Ed Loudlove. 0:00:24.280 --> 0:00:27.520 I'm Caroline Heine Bluemerg's world headquarters in New York, and. 0:00:27.480 --> 0:00:30.639 I'm Ed Lovelow here in San Francisco. This is Blueberg Technology. 0:00:30.880 --> 0:00:30.960 Ed. 0:00:31.080 --> 0:00:33.720 It is a huge day for big tech, earning Spotify 0:00:33.760 --> 0:00:36.319 already out the gate. We've got Alphabet, Microsoft reporting after 0:00:36.360 --> 0:00:40.159 the bell with AdSpend AI search engine details front of 0:00:40.320 --> 0:00:41.360 mind for investors. 0:00:42.200 --> 0:00:46.120 Then the European Union says nineteen major online platforms and 0:00:46.159 --> 0:00:49.319 search engines will be subject to extra scrutiny under its 0:00:49.320 --> 0:00:52.440 new content moderation rules, including a plan to conduct a 0:00:52.479 --> 0:00:54.440 live stress test at Twitter. 0:00:54.840 --> 0:00:57.680 And that's talking of at Twitter. The app Blue Sky. 0:00:58.000 --> 0:01:01.520 It's about by Jack Dorsey. It's emerging as possible alternative 0:01:02.000 --> 0:01:04.720 to Twitter. What makes it different from the competitors. We'll 0:01:04.760 --> 0:01:07.240 dig into that moment, but first let's check in on 0:01:07.240 --> 0:01:10.800 those markets. Because once again we are worried about recessionary risks, 0:01:10.840 --> 0:01:13.199 we are worried about the macro environment. We are therefore 0:01:13.240 --> 0:01:15.440 selling off on the Nastak more than a percentage point 0:01:15.520 --> 0:01:17.759 lower worse than some of the other key benchmarks as 0:01:17.760 --> 0:01:19.440 we see some of the data, whether it be about 0:01:19.440 --> 0:01:22.240 consumer confidence, whether it be about housing prices, just showing 0:01:22.440 --> 0:01:24.880 some slowing in this US economy. Tenure yield therefore a 0:01:24.920 --> 0:01:27.880 flight to safety six basis points, seven basis points. Hays 0:01:27.880 --> 0:01:29.560 call it on the downside of the tenure below that 0:01:29.560 --> 0:01:33.000 two hundred day moving average. Meanwhile, we're not only risk 0:01:33.040 --> 0:01:35.039 averse in the US, we're also risk averse for a 0:01:35.120 --> 0:01:38.800 six straight day in terms of your US traded Chinese names. 0:01:38.840 --> 0:01:40.600 Why this has a lot to do with geopolitics, said, 0:01:40.600 --> 0:01:42.600 and the worry that we're going to limit US investment 0:01:42.640 --> 0:01:44.720 in those Chinese names. And look what's happening in the 0:01:44.760 --> 0:01:46.440 world of crypto, another bit of a bell weather in 0:01:46.520 --> 0:01:48.280 terms of risk sentiment. It's back to being a risk 0:01:48.320 --> 0:01:51.280 asset and we're down by a half a percentage point. 0:01:51.640 --> 0:01:54.080 Yeah, earnings the main driver for me on the micro picture. 0:01:54.120 --> 0:01:56.520 I'm taking a night at GM right. They've raised guidance 0:01:56.560 --> 0:01:59.080 for twenty three, but there's a lot of analyst concern 0:01:59.120 --> 0:02:01.640 about how thin margin's going to be as they shift 0:02:01.800 --> 0:02:04.600 to EV A bit of a public service announcement, they're 0:02:04.640 --> 0:02:07.480 retiring the Chevy Bolt production will end on that model 0:02:07.480 --> 0:02:10.320 this year, which is an interesting moment of Eve history. 0:02:10.520 --> 0:02:13.120 First Republic also interesting because, as we've been talking about 0:02:13.160 --> 0:02:16.400 for weeks, so much of our audience were depositors at 0:02:16.440 --> 0:02:19.280 First Republic, and that's where the concern is, deposit outflow. 0:02:19.320 --> 0:02:20.520 I are you and I are going to talk about 0:02:20.520 --> 0:02:23.120 that later in the program. Look at how severe the 0:02:23.240 --> 0:02:26.200 drop is. A restructuring is on the cards. Strategic obsens 0:02:26.480 --> 0:02:28.440 that's the downside. For the upside, we are looking at 0:02:28.480 --> 0:02:32.760 Spotify out the gate with earnings this Monday, subscribers on 0:02:32.800 --> 0:02:36.440 the paid side rising fifteen percent, hiundred and twelve million. 0:02:36.720 --> 0:02:39.399 On the monthly active users, We've actually breached that five 0:02:39.480 --> 0:02:43.080 hundred million mark, five hundred and fifteen million monthly active 0:02:43.200 --> 0:02:46.840 users and narrower than expected loss. There's still questions around 0:02:46.880 --> 0:02:49.400 profitability long term, but then you look at their outlook 0:02:49.440 --> 0:02:53.160 for the second quarter revenue growth, subscriber growth, monthly active 0:02:53.240 --> 0:02:54.840 user growth, and that's what investors like to hear. 0:02:54.919 --> 0:02:56.960 Karen, Yeah, all good signs, but let's dig in on 0:02:57.000 --> 0:02:59.960 whether that path to profitability is getting any closer. Spotify 0:03:00.040 --> 0:03:03.600 I focus with Sandy Shamah's Third Bridge Senior analyst. So 0:03:04.160 --> 0:03:06.519 you're reading the positive in terms of the tea. 0:03:06.400 --> 0:03:10.239 Leaves here, Yeah, absolutely, Carol and at Pleasure Pleasure beyond. 0:03:10.240 --> 0:03:12.440 So first off, straight off the bat, pretty good, a 0:03:12.480 --> 0:03:14.800 good performance across the board, and we saw fourteen percent 0:03:14.840 --> 0:03:17.920 revenue growth, we saw consistent grasp offit margins, and yes 0:03:18.000 --> 0:03:20.880 EPIT prafitability was down as well, but again this is 0:03:20.919 --> 0:03:23.560 sort of in liner what we've expected. But I think 0:03:23.760 --> 0:03:25.959 a big thing over here is that, you know, when 0:03:25.960 --> 0:03:28.720 it comes to Spotify across the entire board, they've been 0:03:28.760 --> 0:03:31.320 focusing so much in what they show to investors, which 0:03:31.400 --> 0:03:33.919 is subscriber growth, and again that shows in the ways 0:03:33.919 --> 0:03:37.160 in which they've reported their numbers across But what retail 0:03:37.200 --> 0:03:40.280 and institutional investors really seemed to be focused on, a 0:03:40.360 --> 0:03:42.960 world really focused on in twenty twenty two was that 0:03:43.040 --> 0:03:45.920 path to profitability. What that's led to is sort of 0:03:46.320 --> 0:03:49.440 a mismatch or inability to come up with a unified, 0:03:49.480 --> 0:03:52.600 coherent equity story for the business, and that perhaps has 0:03:52.600 --> 0:03:54.800 been responsible for what some could argue to be a 0:03:54.840 --> 0:03:57.880 relative under performance for a company of this scale. So, yes, 0:03:57.880 --> 0:04:00.800 we're seeing positives across the board, but the experts we've 0:04:00.840 --> 0:04:03.560 interviewed at Third Bridge. It really appears as if the 0:04:03.680 --> 0:04:07.760 longer term sustainable profitability might be something the company can 0:04:07.840 --> 0:04:10.880 hit right now, it's maybe a story mode about market 0:04:10.920 --> 0:04:13.520 shared attention and market share gains as a whole. 0:04:13.840 --> 0:04:18.200 So right now, market share, mark share. Let's talk about 0:04:18.279 --> 0:04:19.040 technology as well. 0:04:19.040 --> 0:04:19.160 Though. 0:04:19.200 --> 0:04:20.719 What I find is so interesting is there's a lot 0:04:20.760 --> 0:04:23.240 of option out there. We were talking on this program 0:04:23.279 --> 0:04:26.880 about Apple, for example, raising services prices with Apple Music. 0:04:27.680 --> 0:04:31.039 Spotify is growing its subscriber base. Why is it podcasts? 0:04:31.120 --> 0:04:33.440 Is it the music library? There must be a reason 0:04:33.800 --> 0:04:36.920 that they're continuing this growth narrative at least. 0:04:37.200 --> 0:04:39.520 No absolutely, So you know, I'll probably try and split 0:04:39.560 --> 0:04:41.720 that down into two components. That becomes a bit more 0:04:41.760 --> 0:04:44.280 clear so we can see the emerging picture. Let's move 0:04:44.320 --> 0:04:46.159 in to the developed markets first and look at the 0:04:46.160 --> 0:04:49.200 premium subscribers that first off Spotify. The one thing that's 0:04:49.240 --> 0:04:51.320 been able to do in a fantastic way is have 0:04:52.080 --> 0:04:55.359 very strong brand equity across the board. It's got a 0:04:55.360 --> 0:04:58.839 powerful first mover advantage and it's also developed. It's also 0:04:58.880 --> 0:05:01.839 been so ingrained into how consumers tend to user product 0:05:01.880 --> 0:05:04.240 that Spotify. For a lot of people becomes the go 0:05:04.279 --> 0:05:06.720 to that they end up using. It's easier for them 0:05:06.720 --> 0:05:09.040 to acquire those customers and have them on. So in 0:05:09.080 --> 0:05:11.440 the premium of the space, you know, they're doing quite 0:05:11.440 --> 0:05:14.160 well over there as opposed to other players who will 0:05:14.200 --> 0:05:16.839 ruddle in the market. But if you're looking at it 0:05:16.839 --> 0:05:19.240 from the perspective of emerging markets, you know, some of 0:05:19.279 --> 0:05:21.279 the interviews we have done where we've looked at Spotify 0:05:21.360 --> 0:05:25.080 in the Middle East and North Africa and India, Latin America. Again, 0:05:25.120 --> 0:05:28.440 they spoke about that Latin American performances earnings. They are 0:05:28.440 --> 0:05:31.719 going very aggressive in terms of their marketing spend over there. 0:05:32.279 --> 0:05:35.800 We'll talk about that praft ability consideration, but Spotify appeers 0:05:35.839 --> 0:05:39.520 to have realized that longer term. Again, longer term, yes, 0:05:40.000 --> 0:05:42.400 if they're able to craft these developed markets, that's how 0:05:42.440 --> 0:05:44.800 they're going to be able to get that praftability and scale. 0:05:45.040 --> 0:05:47.400 Hey, Caroline, the big theme of this earning season is 0:05:47.440 --> 0:05:50.800 artificial intelligence. When I open Spotify, the platform knows what 0:05:50.880 --> 0:05:53.479 I want. It's red hot chili peppers every time. But 0:05:53.760 --> 0:05:55.920 what's the really clearly when it comes to Spotify is 0:05:55.960 --> 0:05:56.559 the big question. 0:05:56.680 --> 0:05:59.720 Yeah, and really the investments is making in technology and 0:05:59.720 --> 0:06:02.159 that actually remember the AIDJ that we got to play 0:06:02.200 --> 0:06:03.760 with a little bit earlier in the quarter ed and 0:06:04.360 --> 0:06:07.240 suddenly to your point, therefore are they making the rights 0:06:07.279 --> 0:06:09.680 investments because many felt that they were having to dial 0:06:09.839 --> 0:06:12.800 back some of that spending, particularly in this overall focus 0:06:12.880 --> 0:06:15.400 of podcasts. But they're still having to spend to deliver 0:06:15.560 --> 0:06:17.159 us the content we want in the right time. 0:06:17.839 --> 0:06:19.960 Absolutely, and so here's a big theme, right. I think 0:06:20.000 --> 0:06:21.880 Daniel lact came out in twenty twenty two and he 0:06:22.000 --> 0:06:24.480 mentioned that we're going to see reduce spending at that 0:06:24.560 --> 0:06:28.000 particular time. The experts we have interviewing across the board 0:06:28.040 --> 0:06:30.280 the reader has been that this is not necessarily going 0:06:30.320 --> 0:06:31.920 to be the case. If you look at the ad 0:06:32.000 --> 0:06:34.920 supported dear first off, you know, in terms of just 0:06:35.000 --> 0:06:38.160 that ability to give the targeted advertisements, Spotify hasn't been 0:06:38.200 --> 0:06:40.240 able to crack that just yet. It's sort of more 0:06:40.360 --> 0:06:43.240 over the counter, so to speak. So it really needs 0:06:43.240 --> 0:06:45.160 to invest further in terms of the ad dech there. 0:06:45.600 --> 0:06:47.640 On top of that, we saw them go ahead with 0:06:47.760 --> 0:06:51.040 more podcast acquisitions and again with more acquisitions in terms 0:06:51.080 --> 0:06:53.480 of the tech there, it really needs to build out 0:06:53.520 --> 0:06:56.760 a more sophisticated targeted meaningful system to do this. So 0:06:56.880 --> 0:06:59.799 again more spending in that element, but it is spending 0:07:00.040 --> 0:07:03.920 in the right direction. But again spending is required onto 0:07:03.960 --> 0:07:06.240 the flip side, moving into the audiobooks that I'm a 0:07:06.560 --> 0:07:10.200 fantastic decision across the board, but right is evident that 0:07:10.320 --> 0:07:12.600 the company still needs to spend over there. So sort 0:07:12.640 --> 0:07:14.880 of the twenty twenty two narrative that we are going 0:07:14.920 --> 0:07:17.640 to slow down in terms of our investments is not 0:07:18.200 --> 0:07:20.120 ideally going to play out over the course of the 0:07:20.200 --> 0:07:22.160 next year a year and a half while they buff 0:07:22.280 --> 0:07:24.880 up that technology throw an AI into the mixtup now 0:07:25.680 --> 0:07:26.920 being an increased focus on that. 0:07:28.000 --> 0:07:30.880 Sandy Shama fir Bridge senior analysts, like many Cara one 0:07:30.880 --> 0:07:33.760 of those that says profitability will come with scale, kind 0:07:33.760 --> 0:07:35.600 of this catch twenty two situation. 0:07:35.680 --> 0:07:36.840 Anyway, today we're going to get. 0:07:36.720 --> 0:07:39.480 Results from Microsoft and Alphabet after the bell. For that, 0:07:39.560 --> 0:07:42.840 we bring in Bloomberg into intelligence senior analysts and rag 0:07:42.880 --> 0:07:44.960 Rana and rag let's start with Microsoft. What is it 0:07:45.040 --> 0:07:46.640 that you want to see from this company? What is 0:07:46.720 --> 0:07:48.880 it that's going to bring you some potential outside surprise. 0:07:49.760 --> 0:07:52.520 So I would say the comments would be most critical 0:07:52.600 --> 0:07:55.040 because you know so far we have seen a downward 0:07:55.120 --> 0:07:59.640 trajectory in cloud sales, infrastructure sales PC. I mean throughout 0:07:59.680 --> 0:08:02.520 the tire ecosystem. You know, we are looking at slow 0:08:02.600 --> 0:08:07.040 down and demand. You know, any comments about even stabilization 0:08:07.280 --> 0:08:09.600 would I think be welcomed by investors. 0:08:10.440 --> 0:08:13.680 What's interesting, Ana Argus, We've almost moved away from fundamentals 0:08:13.760 --> 0:08:15.600 with Microsoft a little bit. It's caught up been the 0:08:15.680 --> 0:08:18.520 hypeer AI. How much do you want to hear about 0:08:18.640 --> 0:08:22.400 future revenue addition from this investment or are you looking 0:08:22.480 --> 0:08:24.400 more than in the here and now it's not really prevalent. 0:08:24.840 --> 0:08:27.080 See if they give a guideline that, you know, they 0:08:27.120 --> 0:08:30.520 should start seeing some kind of a revenue upside maybe next. 0:08:30.440 --> 0:08:32.599 Quarter or the quarter after that, people will like that. 0:08:32.960 --> 0:08:35.120 But frankly speaking, this is so much in the test 0:08:35.320 --> 0:08:38.319 phase right now that the addition to cloud revenue or 0:08:38.400 --> 0:08:40.760 other areas, it's going to be a while before we 0:08:40.880 --> 0:08:43.800 see that. So I think the big growth factor or 0:08:43.840 --> 0:08:46.520 the big factor today is where is enterprise tex spending 0:08:46.840 --> 0:08:49.240 and what should we expect over the next couple of quarters. 0:08:50.200 --> 0:08:52.880 If we're going to try and read across the entirety 0:08:52.880 --> 0:08:55.240 of learning season, what I take away from your preview 0:08:55.320 --> 0:08:59.240 decks is the bread and butter businesses are under the spotlight. 0:09:00.000 --> 0:09:01.360 What we want to see is some of the other 0:09:01.480 --> 0:09:04.080 sides of their business perform. You take Google as an 0:09:04.120 --> 0:09:09.160 example search we're worried cloud could be a boost. 0:09:09.880 --> 0:09:10.080 Yeah. 0:09:10.080 --> 0:09:12.800 See for Google, for example, the cloud business is small 0:09:12.880 --> 0:09:14.679 but growing very well. I mean, I think this is 0:09:14.679 --> 0:09:18.120 an area where they have differentiated compared to rivals, and 0:09:18.200 --> 0:09:20.839 I think you know they have their space in the 0:09:20.920 --> 0:09:23.240 top vendors. I mean, Amazon's never going to lose their 0:09:23.280 --> 0:09:25.679 top spot in our view, Microsoft's going to remain the 0:09:25.760 --> 0:09:28.000 number two player there, but Google is going to be 0:09:28.080 --> 0:09:32.680 a very strong number three contender for cloud infrastructure services, 0:09:33.000 --> 0:09:35.000 and I think they have done a good job about it. 0:09:36.120 --> 0:09:39.280 Overall. How is the market positioned for these numbers, do 0:09:39.360 --> 0:09:42.240 you think? I mean, have we ridden on hype for 0:09:42.320 --> 0:09:45.520 both names, and we're worried that overall we could see 0:09:45.600 --> 0:09:48.040 a knee jerk reactions we tend to in after hours, 0:09:48.080 --> 0:09:50.600 but then we start to drift through and really decide 0:09:50.640 --> 0:09:52.480 where the growth potential is for these names. 0:09:52.640 --> 0:09:54.880 I think the guidances obviously is the biggest key at 0:09:54.880 --> 0:09:57.319 this point, because the numbers are going to be what 0:09:57.440 --> 0:10:00.240 they have, and the guidance comes on the call, and 0:10:00.360 --> 0:10:03.040 the question over THEATA is we are all expecting numbers 0:10:03.160 --> 0:10:05.880 or guidance to be slightly down compared to what people 0:10:05.920 --> 0:10:08.439 are expecting. But if it's really bad, then I think 0:10:08.480 --> 0:10:10.080 it's going to be a bad day tomorrow. If they 0:10:10.120 --> 0:10:11.800 go out and say, you know, we have seen some 0:10:11.880 --> 0:10:15.360 stabilization in new growth, and then you know it's going 0:10:15.400 --> 0:10:17.000 to be the exact opposite of that. 0:10:17.559 --> 0:10:19.920 I'll see, of course, ed how cost cutting comes into 0:10:19.920 --> 0:10:20.600 all of that as well. 0:10:21.880 --> 0:10:24.160 Yeah, we will do in Gosh, what a busy we've 0:10:24.160 --> 0:10:26.560 got ahead of us. Bloom meg Instelligences, Anna rag Rana, 0:10:26.960 --> 0:10:27.319 thank you. 0:10:35.920 --> 0:10:42.360 Now some nineteen major online platforms and search engines, including YouTube, Facebook, Instagram, Twitter, Well, 0:10:42.360 --> 0:10:44.640 they're going to be subject to extra scrutiny and potential 0:10:44.720 --> 0:10:48.120 fines under new content moderation rules set by the European Union. 0:10:48.480 --> 0:10:51.079 Bloomeg's Amy Tonson joins us. Now just update us on 0:10:51.360 --> 0:10:53.480 will remind us what is the Digital Services Act? 0:10:55.120 --> 0:10:55.360 Sure? 0:10:55.520 --> 0:10:58.800 Yeah, the Digital Services Acts get rolled out by the 0:10:58.840 --> 0:11:03.160 European Commission last year and it's all about raining in 0:11:03.320 --> 0:11:07.240 what big tech companies can do with your data. So 0:11:07.400 --> 0:11:11.760 it includes things like bands on serving ads to minors, 0:11:12.840 --> 0:11:18.040 bands on serving ads based on what the Commission calls 0:11:18.120 --> 0:11:24.240 sensitive personal characteristics like sexual orientation. It's got rules about 0:11:24.400 --> 0:11:30.120 combating this info. It's got additional reporting requirements and transparency 0:11:30.200 --> 0:11:32.160 requirements that these guys are going to have to follow. 0:11:33.360 --> 0:11:38.520 Hey, Amy, there's nineteen companies technology names potentially impacted, some 0:11:38.760 --> 0:11:42.120 more than others. Which are those names caught by these 0:11:42.240 --> 0:11:44.400 rules and sort of the strengthening of the rules. 0:11:46.080 --> 0:11:48.080 Yeah, it's nobody. 0:11:48.080 --> 0:11:50.880 Who'd surprise you. I think it's anybody with more than 0:11:51.000 --> 0:11:53.120 forty five million monthly. 0:11:52.920 --> 0:11:57.319 Active users in Europe. So it's all the big guys. 0:11:57.480 --> 0:12:02.640 It's a number of Google's platforms, it's Metas platforms, Facebook 0:12:02.679 --> 0:12:09.240 and Instagram, it's Snapchat, it's TikTok, it's Amazon, it's Apple, 0:12:10.280 --> 0:12:12.040 a lot of the big international tech companies. 0:12:12.120 --> 0:12:14.120 So getting getting caught up in this, and that's what 0:12:14.200 --> 0:12:15.240 it was meant for. 0:12:15.440 --> 0:12:15.680 Really. 0:12:16.800 --> 0:12:19.800 Yeah, and the penalties for some of those names potentially 0:12:19.920 --> 0:12:22.959 quite severe as a proportion of global revenue. Thanks to 0:12:22.960 --> 0:12:25.880 Bloomberg's Amy Thompson, who's leading our tech coverage in the 0:12:26.520 --> 0:12:29.680 Emia region. Now, speaking of Twitter, some Twitter users are 0:12:29.720 --> 0:12:33.440 growing weary of using the platform. Since Elon Musk's takeover, 0:12:33.640 --> 0:12:37.959 others are turning to Blue Sky as a possible alternative. 0:12:38.320 --> 0:12:40.880 That's if you can make it off the waitlist is 0:12:41.080 --> 0:12:45.000 account Saisia Counts joins Us, Bloomberg News, Social Media Report Asia. 0:12:45.280 --> 0:12:47.040 What is Blue Sky? Where's this come from? 0:12:48.280 --> 0:12:51.240 Yeah, it's a Twitter alternative. As you mentioned, right, in 0:12:51.320 --> 0:12:54.520 the wake of Elon muss taking over Twitter, a lot 0:12:54.559 --> 0:12:56.640 of people have not been happy with the platform, whether 0:12:56.679 --> 0:13:00.760 it's from a colientent moderation perspective, all the changes of verification, 0:13:01.360 --> 0:13:04.280 and so blue Sky is another alternative. It looks very 0:13:04.320 --> 0:13:06.719 similar to Twitter if you see it, and it's got 0:13:06.760 --> 0:13:10.319 the backing of Jack Dorsey, who obviously was really involved 0:13:10.400 --> 0:13:12.840 with Twitter from the early days, and so that's giving 0:13:12.920 --> 0:13:15.480 people some confidence to want to try out the platform. 0:13:15.679 --> 0:13:18.439 Yeah, what is it about? Quarter of a million iPhone 0:13:19.000 --> 0:13:22.400 downloads so far? I mean, nowhere near Twitter's overall use case. 0:13:22.520 --> 0:13:25.800 But Ayisha, how is it distinct not only from Twitter, 0:13:25.920 --> 0:13:28.640 but distinct from other competitors out there? I'm thinking of Masteredon, 0:13:28.720 --> 0:13:31.760 which also wants to be some sort of decentralized social platform. 0:13:33.040 --> 0:13:35.840 I mean that's the challenge, right, is how do you differentiate. 0:13:36.240 --> 0:13:38.400 A lot of them are very very similar to Twitter. 0:13:38.440 --> 0:13:41.120 They're going to look very similar on the feed right now. 0:13:41.240 --> 0:13:43.640 Blue Sky has a waitlist, so in some ways they're 0:13:43.679 --> 0:13:45.800 trying to control how many people can be on the platform. 0:13:46.320 --> 0:13:50.120 You mentioned trying to have sort of a decentralized open protocol. 0:13:50.480 --> 0:13:53.200 If you think about massed on, they have different servers, 0:13:53.280 --> 0:13:55.400 so you have to be on a server to follow someone, 0:13:55.720 --> 0:13:58.200 and so that gets a little bit more complicated. Blue 0:13:58.240 --> 0:14:01.160 Sky's a little bit more straightforward in terms of onboarding, 0:14:01.520 --> 0:14:03.679 but it's really going to be that's going to be 0:14:03.720 --> 0:14:05.960 the question moving forward. How do they differentiate when they're 0:14:05.960 --> 0:14:06.680 all very similar. 0:14:08.280 --> 0:14:10.760 I mean, Caro, they look identical to me. I don't 0:14:10.800 --> 0:14:11.240 know about you. 0:14:11.480 --> 0:14:15.040 Like Paragagrowell, for example, is believed to have gone to 0:14:15.080 --> 0:14:18.200 Blue Sky. People have been sharing screenshots of his profile 0:14:18.559 --> 0:14:21.280 on Twitter, but when you're scrolling through, it just looks 0:14:21.360 --> 0:14:21.760 like Twitter. 0:14:21.920 --> 0:14:25.880 Yeah, but maybe that's not surprising given it was basically 0:14:26.000 --> 0:14:28.720 born out of Twitter, right as I mean, its history 0:14:28.840 --> 0:14:31.360 is that it was backed in many ways and sort 0:14:31.360 --> 0:14:33.200 of a startup within the company. 0:14:35.080 --> 0:14:37.840 Right, So it's not super surprising. And you see the 0:14:37.880 --> 0:14:40.680 same thing with other alternatives. There's an alternative called T 0:14:40.880 --> 0:14:44.640 two that was created by former Twitter employees. Like all 0:14:44.720 --> 0:14:47.080 of them are sort of playing off of what Twitter 0:14:47.160 --> 0:14:49.280 did because it was successful at what it did. The 0:14:49.400 --> 0:14:51.880 question will be will they be able to really convince 0:14:52.040 --> 0:14:54.440 users to come on in a massive way As you 0:14:54.520 --> 0:14:57.680 mentioned right, two hundred and twenty five thousand or so downloads, 0:14:58.000 --> 0:15:00.480 and you think about Twitter which has five hundre million 0:15:00.600 --> 0:15:03.040 monthly active users according to US, So it's going to 0:15:03.160 --> 0:15:05.520 really be a challenge to scale. I think that's what 0:15:05.600 --> 0:15:07.800 we're going to see over the coming months and years. 0:15:08.680 --> 0:15:10.720 I think it's important nations go back to the two 0:15:10.920 --> 0:15:15.440 big changes of the Twitter platform recently, which is subscribers 0:15:16.720 --> 0:15:20.040 and also verification. Just remind us what the latest on 0:15:20.080 --> 0:15:20.920 both those fronts are. 0:15:22.360 --> 0:15:25.040 Yes, So if you think about verification, you have to 0:15:25.120 --> 0:15:27.480 sign up for Twitter Blue, which costs about eight dollars 0:15:27.520 --> 0:15:30.240 per month, have a display name, a photo, and a number, 0:15:30.280 --> 0:15:32.680 and then you get your blue check mark. Obviously, that's 0:15:32.760 --> 0:15:37.000 been really challenging because you have established organizations from news 0:15:37.040 --> 0:15:41.720 institutions to political figures, to athletes and celebrities that lost 0:15:41.760 --> 0:15:44.640 their legacy checkmerks. So it's not about being notable anymore. 0:15:44.760 --> 0:15:48.840 So that's one huge change. Part of that is subscribing 0:15:48.920 --> 0:15:51.120 to Twitter Blue. But then there's also a new feature 0:15:51.160 --> 0:15:53.960 release where you can actually subscribe to an individual person 0:15:54.040 --> 0:15:56.880 and get access to additional content. There's been a ton 0:15:57.000 --> 0:16:00.600 of changes on the platform. But what's the challenge. It's 0:16:00.680 --> 0:16:03.800 really hard to tell which accounts are authentic or are not, 0:16:04.160 --> 0:16:06.200 and so that's really been one of the main sticking points. 0:16:06.720 --> 0:16:09.920 As Disney will attest earlier this week, Asia counts. Thank 0:16:10.000 --> 0:16:12.840 you so much, brilliant reporting as always. Meanwhile, coming up, 0:16:13.200 --> 0:16:15.560 there's another win for Apple in the fight over its 0:16:15.600 --> 0:16:19.680 app store policies. We'll dig in from New York, San Francisco. 0:16:19.720 --> 0:16:20.920 This is Blomberg. 0:16:53.320 --> 0:16:54.600 Time for Wall Street Beat Karen. 0:16:54.640 --> 0:16:58.520 Today we're focusing on First Republic Bank, actually San Francisco, 0:16:58.640 --> 0:17:01.880 California based bank after the collapse of Silicon Valley Bank. 0:17:02.440 --> 0:17:05.240 Were that that chart says it all. They've reported earnings. 0:17:05.320 --> 0:17:09.359 Depositive flight is a huge concern. The shares down ninety 0:17:09.400 --> 0:17:12.840 percent year to date now, and their strategic options is 0:17:12.840 --> 0:17:14.400 the word that they're using. 0:17:14.680 --> 0:17:16.320 I mean, there is the year to stay chart that's 0:17:16.440 --> 0:17:19.000 just so painful. I mean, all of this, the fact 0:17:19.040 --> 0:17:23.199 that they missed the analyst expectations for consumer deposits. They 0:17:23.280 --> 0:17:26.800 plunged forty one percent worse than expected, even after the 0:17:26.920 --> 0:17:28.880 rescue attempts. Are the big banks here in the US 0:17:29.000 --> 0:17:31.879 they lent them thirty billion of their own cash deposited. 0:17:31.960 --> 0:17:34.560 That so really the fact that we're hearing that they're 0:17:34.600 --> 0:17:36.879 going to have to cut people, it doesn't seem to 0:17:36.960 --> 0:17:39.280 put an end to its own what seemed to be 0:17:39.320 --> 0:17:42.119 quite idiosyncratic issues now ed for. 0:17:42.160 --> 0:17:45.200 That bank, particularly an injection of capital, but it was 0:17:45.240 --> 0:17:47.240 supposed to be an injection of confidence. And as it 0:17:47.280 --> 0:17:51.600 relates to our audience, venture capitalists startups were banking with 0:17:51.680 --> 0:17:54.320 First Republic. But last night on Twitter, just so many 0:17:54.359 --> 0:17:57.040 people talking about how did we get here? How did 0:17:57.080 --> 0:17:58.040 it get even worse? 0:17:58.480 --> 0:18:00.640 Yeah, and the fact that they so focused on big 0:18:00.720 --> 0:18:04.040 mortgages to big wealthy people. And yes, they moved elsewhere. 0:18:04.400 --> 0:18:06.560 Let's talk about something else, moving away from the world 0:18:06.640 --> 0:18:09.680 of well Wall Street to the world of key tech, 0:18:09.720 --> 0:18:12.239 which is Apple. And in fact we're talking legal here. 0:18:12.280 --> 0:18:14.680 It's just one and appeals court ruling upholding its app 0:18:14.720 --> 0:18:17.000 storece policies, and then a trust challenge that the course 0:18:17.080 --> 0:18:19.360 was brought by Epic games. Remember the maker of Fortnite 0:18:19.680 --> 0:18:23.120 tes bring in Blueberg's intelligence is Jennifer Ree, who, Well, 0:18:23.600 --> 0:18:26.719 it had already sort of self imposed some changes here, 0:18:26.920 --> 0:18:29.800 been trying to see these headwinds coming on it. But 0:18:30.240 --> 0:18:33.280 the fact that the courts sort of upheld its side 0:18:33.320 --> 0:18:35.600 of the story we surprised. 0:18:35.680 --> 0:18:38.040 You know, not too surprised, somewhat, I think, you know, 0:18:38.080 --> 0:18:40.040 I heard the argument on appeal, and it was really 0:18:40.080 --> 0:18:42.000 hard to call what the justices we're going to do 0:18:42.440 --> 0:18:46.040 because the lower court opinion was somewhat controversial, well thought out, 0:18:46.359 --> 0:18:49.520 but somewhat controversial. When you had this three panel, the judges, 0:18:49.600 --> 0:18:51.239 three of them, and you need two out of one 0:18:51.400 --> 0:18:53.800 out of the three to vote. One spoke a lot, 0:18:53.880 --> 0:18:55.920 seemed to be for Apple, one spoke a lot seemed 0:18:55.920 --> 0:18:57.600 to be epic, and the third one didn't say a word. 0:18:58.000 --> 0:18:59.960 So it was a little bit hard to predict, you know. 0:19:00.000 --> 0:19:01.760 But at the end of the day, they basically pretty 0:19:01.840 --> 0:19:04.359 much affirmed everything that the lower court had done. They 0:19:04.480 --> 0:19:07.240 disagreed with some things, but they said where they disagreed 0:19:07.240 --> 0:19:09.960 it was harmless, meaning even if the judge had done 0:19:10.000 --> 0:19:12.080 it differently, it still would have come out the same. 0:19:12.240 --> 0:19:14.840 The ultimate outcome so it doesn't really matter and they 0:19:14.880 --> 0:19:16.880 don't have to go back to her, and they sent 0:19:16.960 --> 0:19:18.720 it back to her on just a little issue of 0:19:18.760 --> 0:19:21.320 whether or not Epic has to pay some of Apple's 0:19:21.440 --> 0:19:25.200 legal bills, just a very minor thing, really not the 0:19:25.400 --> 0:19:27.760 main aspect of this litigation. But for the most part 0:19:27.880 --> 0:19:30.760 it holds, and Apple's walled garden still survives. 0:19:31.880 --> 0:19:34.760 So jen Apple came out after this decision and said 0:19:35.200 --> 0:19:37.360 it was a resounding victory. I think they literally used 0:19:37.400 --> 0:19:39.879 those words because nine out of the ten claims were 0:19:39.920 --> 0:19:40.959 settled in their favor. 0:19:41.359 --> 0:19:43.159 But to the point you just made, one was not 0:19:44.040 --> 0:19:45.199 Can you explain that to us? 0:19:45.359 --> 0:19:49.080 Was there any positive that Epic in particular could take away? 0:19:49.760 --> 0:19:51.800 You know, the most interesting thing is that the one 0:19:51.920 --> 0:19:55.280 claim that was against Apple wasn't really something Epic asked for. 0:19:56.040 --> 0:19:58.760 So what that was was an abolition on what are 0:19:58.800 --> 0:20:01.560 called anti steering war, and these are rules Apple had 0:20:01.600 --> 0:20:05.280