Speaker 1: From Marhard where Innovation of Money and Power Collie in
Speaker 1: Silicon Vallet NBN. This is Bloomberg Technology with Caroline Hyde
Speaker 1: and Ed Ludlow.
Speaker 2: I'm Caroline Heindel Bloomugswelte Quarters in New York.
Speaker 3: And I'm Ed Ludlow in San Francisco. This is Bloomberg
Speaker 3: Technology coming up.
Speaker 2: We go live to the White House to speak with
Speaker 2: Heather Bouchet of the Council of Economic Advisors, her take
Speaker 2: on today's CPI print and the impacts of the Inflation
Speaker 2: Reduction Act.
Speaker 3: Plus, Alphabet loses its anti trust fight with Epic Games
Speaker 3: as a federal court jury in California rules Google Play
Speaker 3: is a monopoly. Will break down the impact of the
Speaker 3: antitrust ruling.
Speaker 2: And space surveillance startup true anominally raises one hundred million
Speaker 2: dollars in its latest funning round to ramp up output
Speaker 2: of its satellite that can track national threats in orbit.
Speaker 2: We'll discuss with that and so much more throughout this hour. First,
Speaker 2: that's checking on these markets. And while the initial threat
Speaker 2: over the CPI print just running ever so slightly hot,
Speaker 2: and one particular point in the margin generally has died down,
Speaker 2: and we see two tens of percent up on the NASDAK.
Speaker 2: No great shapes we're seeing the two year you'll completely flat,
Speaker 2: having originally just spiked high, we come back down. We
Speaker 2: bribe Brieth what seems to be a bit of a size.
Speaker 2: People take on board the fact that really CPI is
Speaker 2: ultimately slowing, but still some areas are concerned maybe at
Speaker 2: BE rent, maybe at be of course.
Speaker 4: The cost of your cars.
Speaker 2: We've got so much to discuss with this inflationary environment
Speaker 2: core CPI.
Speaker 4: Let's get back to it for a moment.
Speaker 2: Ed The data they're coming in today basically matching estimates
Speaker 2: and reinforcing bets that the Federal Reserve we'll have to
Speaker 2: keep rates elevated to tame inflation in the longer term.
Speaker 2: But in the here and the now, we just try
Speaker 2: to really understand where we're dialing back on inflation. We
Speaker 2: want to get the view from the White House Council
Speaker 2: of Economic Advisors, to be precise, the member is Heather Bouchet.
Speaker 2: You join us now and look consumer prices in general.
Speaker 2: The print came in well where the market had seen it.
Speaker 2: The headline take to bob expectations on the month a
Speaker 2: month just episod slightly.
Speaker 4: But what was your read on today's print.
Speaker 1: Well, certainly, as you noted, the headline was a bit
Speaker 1: above market expectations. But when you look at the whole report,
Speaker 1: you see that the pace of inflation, you know, in
Speaker 1: various parts of the report, has been coming down in
Speaker 1: ways that are really important for consumers. So, for example,
Speaker 1: the pace of inflation for groceries or slower than they
Speaker 1: have been in over a year. And you know that
Speaker 1: is consistent with news that we were talking about right
Speaker 1: after Thanksgiving, where the price of a Thanksgiving dinner was
Speaker 1: cheaper this year than it was last year. And as
Speaker 1: we look forward to the holiday season, you see that
Speaker 1: some goods that are going to be important for families,
Speaker 1: sporting goods or toys or you know, things that they
Speaker 1: might buy for Christmas, like televisions or whatnot, those prices
Speaker 1: have also the pace is also slowed there as well.
Speaker 1: So there is some good news for consumers in there.
Speaker 1: And you know, when you look over the last quarter,
Speaker 1: the annualized rate of headline inflation is about two point
Speaker 1: two percent.
Speaker 2: I would say, though a lot of consumers don't feel it.
Speaker 2: Now you've rightly pointed out that consumer sentiment has been
Speaker 2: picking up. In December, it's up about thirteen percent. I
Speaker 2: think infation expectations they've been dialing back, but well to
Speaker 2: use on the.
Speaker 4: Day that we get yet another word of the year.
Speaker 2: One word of the year has been this vibe session,
Speaker 2: and the feeling is that people don't feel great, even
Speaker 2: though the economy seemingly is going pretty great. What do
Speaker 2: you say as an administration when that hits hard on
Speaker 2: a consumer that doesn't feel the way that you're currently
Speaker 2: talking about this economy right now.
Speaker 4: Well, let's be very clear.
Speaker 1: The President has been clear, his economic team has been clear.
Speaker 1: We understand that high prices have been hard on families
Speaker 1: and that this has post challenges. Pocketbook questions are really important.
Speaker 1: It's one of the reasons why when I looked at
Speaker 1: this report today, we see actually that wages have now
Speaker 1: been increasing faster than the pace of inflation for seven
Speaker 1: months now, and we know that it takes some time
Speaker 1: for things to you know, kind of for people's perception
Speaker 1: of what's happening in the economy to resonate. We're hopeful
Speaker 1: that as we see wages continued hopefully to outpace inflation,
Speaker 1: that'll help people be able to get their family budgets
Speaker 1: back under control.
Speaker 3: You know.
Speaker 1: The other thing we see, of course, is for the
Speaker 1: eighty percent of workers in the economy that are production
Speaker 1: and non supervisory workers, so not the managers, but the
Speaker 1: production and non supervisory workers, they have fully recovered their
Speaker 1: real wages back to where they had been pre pandemic.
Speaker 1: So that's certainly good news. But we know that the
Speaker 1: path to recover from this historic virus induced recession that
Speaker 1: we had and all of the challenges that we had
Speaker 1: getting back up online and the supply chain challenges, so
Speaker 1: much work went into making things function again in our economy,
Speaker 1: and hopefully as people go into this holiday season, they'll
Speaker 1: see that prices are that the pace is not as
Speaker 1: high as it was last year, and that'll help with
Speaker 1: consumer confidence over time.
Speaker 3: Heather, thank you for your time. It's ed here in
Speaker 3: San Francisco. Our technology audience its workers just have one
Speaker 3: very simple question, what specifics what areas are you you
Speaker 3: seeing the Inflation Reduction Act have a substantive impact in
Speaker 3: lowering inflation? In other words, are there any specific data
Speaker 3: points you can give us that show the IRA has worked.
Speaker 5: Well?
Speaker 1: Let me just focus on one today. So we saw
Speaker 1: in today's report on inflation, that the price of new
Speaker 1: cars has fallen for the past two months, and in fact,
Speaker 1: actually it's fallen for four out of the last six months.
Speaker 1: And one of the things that we've been tracking very
Speaker 1: carefully because of the Inflation Reduction Act is what's been
Speaker 1: happening with US auto industry as we've made these historic
Speaker 1: investments and in batteries and in electric vehicles, and of
Speaker 1: course we've seen that the number of electric vehicles has
Speaker 1: been rising, and we see that actually the price of
Speaker 1: those cars, because there's now more competition, has actually come down.
Speaker 1: So now the price of an electric vehicle is about
Speaker 1: within three thousand dollars of a car.
Speaker 4: Then that's before the.
Speaker 1: Tax credit that families can receive to buy those new
Speaker 1: electric vehicles. So that's one place where those investments are
Speaker 1: helping to bring changes for consumers and families while also
Speaker 1: creating good jobs here in the United States.
Speaker 3: In that case, he a what is the White House's
Speaker 3: reactions the news overnight that Ford has cut its production
Speaker 3: target for the F one to fifty lightning by fifty
Speaker 3: percent twenty four And what they're saying is they're simply
Speaker 3: matching their output to what is what they see as
Speaker 3: being consumer demand.
Speaker 1: Well, I can't comment on that today in the details,
Speaker 1: but you know, we are seeing these historic investments as
Speaker 1: a result of the Inflation Reduction Act. We are seeing
Speaker 1: this uptick in sales for electric fields that we've seen
Speaker 1: in the past. Of course, you know this is it
Speaker 1: is challenging to reshape an entire economy, to build a
Speaker 1: nuclear energy, clean energy economy. But knowing that the President
Speaker 1: has done what he could do working with Congress to
Speaker 1: be able to make sure that business has had the
Speaker 1: support they need to be able to make these investments,
Speaker 1: that's where our energy has been focused.
Speaker 2: There is, of course that tension that ultimately inflationary pressure
Speaker 2: hasn't been helped by geopolitics, by trade, in particular, by
Speaker 2: the fact that we are having to slow in some
Speaker 2: ways the supply chain between the US and China in particular.
Speaker 2: How much of a help or a hindrance is that,
Speaker 2: particularly the moment we think of what's happening in the
Speaker 2: chip sector.
Speaker 4: Well, let me just say a couple of things.
Speaker 1: You know, when you look at the pace of inflation,
Speaker 1: and if you were to overlay price changes along with
Speaker 1: changes in what has happened in the supply chain index
Speaker 1: that we look to. You actually see that a big
Speaker 1: part of why we've been able to get prices down.
Speaker 1: You know, right, they were at their peak nine point
Speaker 1: one percent. Now we're at three point one percent for
Speaker 1: headline inflation. You know, when you look at that shift,
Speaker 1: a lot of that mirrors these challenges that we saw
Speaker 1: in supply chains as an outcome of the pandemic, and
Speaker 1: as businesses had to get up and running, and yet
Speaker 1: there was still this virus around the world and upended
Speaker 1: these global supply chains.
Speaker 4: All the work that the.
Speaker 1: President did to make sure that goods were able to
Speaker 1: be transported, to make sure that the ports were working,
Speaker 1: that played a key role in where we are today
Speaker 1: and getting prices down. And of course global trade isn't
Speaker 1: a really important part of those global supply.
Speaker 4: Chains, Heather.
Speaker 3: In the technology industry, there are still companies that are
Speaker 3: reducing headcount and at the same time AI is driving
Speaker 3: a number of postings which seems to be adding to
Speaker 3: wage inflation because frankly, the numbers are astronomical on offer
Speaker 3: to hire the best talent in AI. Does the White
Speaker 3: House have any data that shows an AI impact on
Speaker 3: the labor force and indeed the economy right now.
Speaker 1: Well, at this moment, this technology is news. So I
Speaker 1: can't we don't have like a specific estimate, but I
Speaker 1: can tell you a couple of things. I mean, first,
Speaker 1: this is an issue that the President takes seriously. In fact,
Speaker 1: I believe today his AI Council is meeting and they're
Speaker 1: having conversations about these technologies. But you know, one of
Speaker 1: the things that we've seen in past instances where we've
Speaker 1: seen new technologies is that people's jobs tend to change,
Speaker 1: and it works its way as it works its way
Speaker 1: through the system. So we expect that, you know, as
Speaker 1: is new technologies come online that'll ship the composition of
Speaker 1: skills that workers need and how they're they're performing on
Speaker 1: the job. But just know that this is something that
Speaker 1: the administration is certainly focused on, as if the President
Speaker 1: is so focused on making sure that we're building an
Speaker 1: economy from the middle out and bottom up and prioritizing
Speaker 1: workers in our economic agenda.
Speaker 3: Hebbalshi, the White House Council of Economic Advisors, Thank you
Speaker 3: very much. Now, coming up, Google loses its a trust
Speaker 3: court fight with Fortnite maker Epic Games. We'll discuss well
Speaker 3: that all means for the two hundred billion dollars per
Speaker 3: year app store industry. That's next. Google Play deliberately wields
Speaker 3: monopoly power. That's what a federal court jury found yesterday
Speaker 3: after liberating less than four hours following a month long
Speaker 3: trial in San Francisco. The court fight was with Fortnite
Speaker 3: maker Epic Games, which should accuse both Google and Apple
Speaker 3: of being a duopoly in the app distribution marketplace and
Speaker 3: enriching themselves by charging developers excessively high fees to this
Speaker 3: games an Epic reminder actually lost it challenged Apple two
Speaker 3: years ago, the Supreme Court reviewing that one. Let's bring
Speaker 3: in Bloomberg's Mark German and Leah Nyland to break this
Speaker 3: all down. Outline the logic of these nine jurors in
Speaker 3: San Francisco. Leah, what was it that they decided on
Speaker 3: and why?
Speaker 4: Yeah, So they.
Speaker 6: Found that Google wields monopoly power in the market for
Speaker 6: app stores, and that it engaged in any competitive conduct
Speaker 6: by paying different people, including gaming companies and smartphonemakers to
Speaker 6: make the Google Play Store the Saul app store on
Speaker 6: various Android phones. And so it's a little bit different
Speaker 6: than in the.
Speaker 4: Apple App Store. You know in the.
Speaker 6: Apple case, you know, Apple does not allow any other
Speaker 6: app stores on the phone, and that's long been its policy.
Speaker 6: And Google, you know, there were all of these payments,
Speaker 6: some worth a significant amount of money. They were paying
Speaker 6: Samsung as much as eight billion dollars over four years
Speaker 6: to ensure that the Google Place or really was the
Speaker 6: best and most accessible access point for people using the
Speaker 6: Android phone. So, I mean, those payments are really what
Speaker 6: people think convinced this jury that you know, Google is
Speaker 6: a monopoly, whereas in the Apple case they didn't really
Speaker 6: have any of that type of evidence.
Speaker 2: To that end, though Mark the reader cross is clear
Speaker 2: and already actually we've seen both Alphabet and Apple having
Speaker 2: to think about the business model and ultimately ultimately how
Speaker 2: it evolves.
Speaker 4: Does it change from here on out on the back
Speaker 4: of this ruling.
Speaker 7: Oh, I certainly think so. So there was one remaining
Speaker 7: point in the Apple case with Epic Games, and that's
Speaker 7: heading to the Supreme Court likely in a few months now,
Speaker 7: and that is steering right the ability for any app
Speaker 7: in the App store to point a user to the
Speaker 7: web to complete transaction. That means the user wouldn't have
Speaker 7: to use Apple's billing system therefore saving the developer between
Speaker 7: fifteen and thirty percent off the top in terms of
Speaker 7: that Apple revenue share. And now that this jury sided
Speaker 7: with Google, potentially that puts this idea in the heads
Speaker 7: of the decision makers, the lawmakers on this last point
Speaker 7: to side with Epic Games and against Apple in this case.
Speaker 7: But there's a couple things that I want to outline here.
Speaker 7: I think Leigh is completely right. I think this came
Speaker 7: down to optics pr and those side agreements that Google
Speaker 7: had with Spotify, Google and other players to really promote
Speaker 7: the Google Play Store. For those unfamiliar, there's a fundamental
Speaker 7: difference between how app stores work on iOS, the iPhone platform,
Speaker 7: and Android, the Google platform. Android devices have supported side loading,
Speaker 7: third party app stores, the installation of apps from outside
Speaker 7: Google Play from the beginning. So the idea here is
Speaker 7: that Google doesn't necessarily have a monopoly on app stores.
Speaker 7: Google has a monopoly on Android smartphones, right, they have
Speaker 7: this ownership over the smartphones. They're paying, like le I said,
Speaker 7: Google to promote Google Play over a Samsung app store, right,
Speaker 7: They're pushing users towards the Google Play Store, right. So
Speaker 7: that's really the fundamental issue here. And in terms of
Speaker 7: how things are going to change. Google, they're probably going
Speaker 7: to have to allow third party billing platforms globally or
Speaker 7: at least in the US because of this lawsuit, and
Speaker 7: in Europe because of the Digital Markets Act in the
Speaker 7: European Union, they're going to have to stop those side deals.
Speaker 7: So you're going to see a lot more flattening and
Speaker 7: potentially more third party app Store is getting traction on
Speaker 7: Android and on the Apple side. Outside of the US
Speaker 7: in the European Union, you're likely to see the same
Speaker 7: thing kickoff in March.
Speaker 2: Well, we're going to wait for the new year, but
Speaker 2: for now it looks as though the businesses are going
Speaker 2: to have to realign somewhat. Bluem Meg's Mark Gumm and
Speaker 2: great breakdown there, Len Island. As always, we thank you
Speaker 2: so much for the expertise.
Speaker 3: Okay, time for talking text so us like Sam Altman
Speaker 3: is back on the conference circuit in touting AIS benefits
Speaker 3: to humanity. In his first public appearance since Altman regained
Speaker 3: control of Open AI, the CEO appeared at a forum
Speaker 3: hosted by Operation Hope to discuss AI's advances. He announced
Speaker 3: that he and John Hope Bryant, the founder of the
Speaker 3: Hope Organization will co chair a new AI ethics council
Speaker 3: based out of Atlanta. Plus, the world's most valuable chip maker,
Speaker 3: in Vidia, has become one of the leading investors in
Speaker 3: AI companies. That's according to estimates by Dealram. The chip
Speaker 3: maker participated in thirty five deals this year, almost six
Speaker 3: times more than last year, making in Vidia the most
Speaker 3: active large scale investor in AI in what was a
Speaker 3: banner year for deal making in the sector and speaking
Speaker 3: of in video, US Commerce Secretary Gina Rimondo says the
Speaker 3: US is looking into the specifics of three new AI
Speaker 3: accelerators that the company is developing for China. The announcement
Speaker 3: comes after vowing earlier this month to restrict any new
Speaker 3: chips that give that country AI capabilities.
Speaker 2: Caroline and that's stick on that one with the Commerce
Speaker 2: Secretary of Momundo. So just warning the US efforts to
Speaker 2: build out the domestic semiconductor industry could be delayed by
Speaker 2: years if companies are required to go through standard environmental reviews.
Speaker 2: Joining US now as someone who knows the space very well,
Speaker 2: Ben Nicklish is the CEO of Element Solutions, which produces
Speaker 2: chemicals in almost every EV but also in smartphones. Computers
Speaker 2: and develop the next generation chemicals that are going to
Speaker 2: enable tech advancements. And then to that end, how much
Speaker 2: is there a local domestic supply chain issue from an environmental.
Speaker 4: Perspective as well.
Speaker 8: Yeah, so there's been a significant ramp and investment in
Speaker 8: semiconductor capability in North America, but it's a muscle that
Speaker 8: we haven't flexed in a long time, and so we
Speaker 8: are bumping. We are seeing the supply chain bump into
Speaker 8: some issues getting capacity online, but we're confident that it
Speaker 8: will come online and there's a real need and capital
Speaker 8: behind it.
Speaker 3: There's just an absolute obsession with GPUs h one hundred
Speaker 3: AMD's out of three under decks, less discussion about the
Speaker 3: infinite list of other chips and the rule materials needed
Speaker 3: to support that infrastructure build out. What is life like
Speaker 3: for you?
Speaker 9: You threw the.
Speaker 3: Chaos of twenty twenty twenty twenty one, where there was
Speaker 3: a real chip crunch industry wide.
Speaker 8: Yeah, so the semiconductor industry has been through real volatility
Speaker 8: in the past several years. There weren't enough chips and
Speaker 8: then there was a big stockpile and so demand softened
Speaker 8: and capacity additions were slowed down. It's been a roller coaster.
Speaker 8: We're fortunate to see demand recovering, semiconductor fab utilization increasing,
Speaker 8: and our business is very well poised to benefit from that.
Speaker 5: From an element.
Speaker 8: Solutions perspective, we sell very small quantities of critical materials
Speaker 8: process chemistries that are used in the fabrication of semiconductors
Speaker 8: and printed circuit boards and the assembly of electronics hardware.
Speaker 8: Fortunately for us, we have ample capacity to meet the
Speaker 8: increasing demand that we expect next year and for many years.
Speaker 3: And trip you touch so many end markets smartphones, electric vehicles,
Speaker 3: Are you so far kind of upstream that you don't
Speaker 3: have the sensitivity to pressures on the end market or
Speaker 3: are you recognizing some pain in the consumer?
Speaker 8: So our business is unit driven, right, and we've been
Speaker 8: living through a very significant draw down, one of the
Speaker 8: largest drawdowns in the smartphone market in its history. Similarly
Speaker 8: in the semiconductor market, the automotive market was soft for
Speaker 8: a period back a few years ago. We're starting to
Speaker 8: see that recover. What's great for our business is that
Speaker 8: we're driven not just by units, but content per unit,
Speaker 8: and as cars become computers, as computing power proliferates, and
Speaker 8: as the technical requirements associated with that computing power become
Speaker 8: more challenging. That's a gain for us in terms of
Speaker 8: our volume and value in each unit and the margin
Speaker 8: opportunity associated with it.
Speaker 2: How much of a straight line is that inevitable move
Speaker 2: towards evs? For example, we would just had head of
Speaker 2: bouchet On of course, from the White House Council of
Speaker 2: Economic Advisors, and we were putting to her like some
Speaker 2: of the concerns surrounding the fact that the Ford lightning,
Speaker 2: for example, the F one fifty has been cut back,
Speaker 2: the twenty twenty four production has been cut.
Speaker 4: Back and indeed in half. Is it that we will be.
Speaker 2: Bumpy in the road towards the shift toward EV's.
Speaker 4: What is it that you see as a key blocker here?
Speaker 8: Sure if you think back three years ago, the rate
Speaker 8: of penetration of electric vehicles to the global automotive fleet
Speaker 8: wouldn't would have paled in comparison to what we've actually seen. Right,
Speaker 8: So automotive electrification has accelerated relative to prior expectations, and
Speaker 8: surely there will be bumps in the road as large
Speaker 8: companies grapple with changing supply chains.
Speaker 3: But the trend is there, you know.
Speaker 4: It's not a straight line.
Speaker 8: There's volatility around that line, but the trend is very positive.
Speaker 8: And for Element, you know, we have really differentiated capabilities
Speaker 8: that are enabling the high performance electric vehicles you see
Speaker 8: on the road today, and we get about one have
Speaker 8: to two times the value an electric vehicle versus a
Speaker 8: comparable internal combustion car. So we're excited by that increasing
Speaker 8: penetration and we see a lot of opportunity associated with.
Speaker 2: It, the opportunity being I'm sure market capitalization boosting.
Speaker 4: How are you seeing your investor base change.
Speaker 8: Ben, Our investor base is solid, sturdy, and very compelled
Speaker 8: by the opportunities we have in front of this company
Speaker 8: and the way we've been deploying capital and support of it.
Speaker 8: We are seeing more energy and attention towards our company
Speaker 8: from electrification, from innovation in high end electronics. We talked
Speaker 8: about AI or you were talking about AI earlier. In
Speaker 8: the proliferation of computing power to the edge of the network,
Speaker 8: those technical challenges are ripe for us to benefit from
Speaker 8: and enable.
Speaker 3: Bank the excitation development solutions, goods CAT shop.
Speaker 2: Of course, AI has been all we've been talking about
Speaker 2: for twenty twenty three. Back in twenty twenty two, it
Speaker 2: was all about crypto and it was still kind of
Speaker 2: all talking around the holiday table, as it seems to
Speaker 2: have been a bit on a run at least bitcoin
Speaker 2: or want to dig into that with Kristin Smith, CEO
Speaker 2: of Lockchain Association, because really all eyes have been on
Speaker 2: the price of bitcoin, but also and also a lot
Speaker 2: of old coins as well. Exuberant seems to have been
Speaker 2: cautiously creeping back. Whether or not that's fundamentally driven on
Speaker 2: the Federal Reserve and inflation, but actually idiosyncratic views that
Speaker 2: we might have more institutional interest from spot bitcoin ETF.
Speaker 4: Is that really what's dictating trade for you?
Speaker 10: I think there's a combination of factors. I think obviously
Speaker 10: the Bitcoin ETF, there's a tremendous amount of excitement around that.
Speaker 10: You know, as you recall a couple of months ago,
Speaker 10: Gray Scale had a huge victory in the court that
Speaker 10: is basically more or less forcing the SEC to consider
Speaker 10: these applications more seriously. The next big sort of deadline
Speaker 10: for when the SEC might make some move around that
Speaker 10: is in early January, though it really could happen anytime.
Speaker 10: But we're hearing that a lot of different applicants are
Speaker 10: having very productive conversations with the SEC, and so there
Speaker 10: is a lot of hope and optimism that we'll get
Speaker 10: something like that done. I do think though, also that
Speaker 10: you know, as you were saying, twenty twenty three was
Speaker 10: not the great year for crypto, and twenty twenty three
Speaker 10: is almost over. I think there is this real sense
Speaker 10: that you know that the bad actors within the crypto
Speaker 10: industry have been weeded out and what's left is really
Speaker 10: the focus on what the technology can do. And so
Speaker 10: we're seeing a lot of optimism not just around bitcoin
Speaker 10: from institutional investors, but sort of returning to the technology
Speaker 10: of crypto, what it can do and how it can
Speaker 10: improve not just finance, but you know, the way that
Speaker 10: we interact on the Internet. So very excited for twenty
Speaker 10: twenty four.
Speaker 2: We do end up rather than talking about blockchain and
Speaker 2: the underlying technology, we talk a lot about the trading
Speaker 2: of the assets, and just to go back to bitcoin
Speaker 2: in and of itself a sport atf you're having discussions.
Speaker 4: With members of your association.
Speaker 2: Is just how quickly that can actually be enacted. Say
Speaker 2: the SEC goes go for it, You're allowed how many days, weeks,
Speaker 2: months is it until you can actually start.
Speaker 10: Yeah, I think that's a little bit unclear. I think
Speaker 10: a lot of it is actually going to depend on
Speaker 10: the SEC and how quickly they move. I know that
Speaker 10: most of the applicants can turn these around pretty quickly.
Speaker 10: They have the you know, the infrastructure in place to
Speaker 10: do so it's really getting the sign off, and so
Speaker 10: I do think that is going to be something to
Speaker 10: look for, you know, hopefully when the SEC makes this announcement.
Speaker 3: The fourth Republican presidential debate they talked about crypto. Thought
Speaker 3: that was interesting. Yes, twenty twenty four is ahead. It
Speaker 3: seems like if twenty twenty three the bad actors have
Speaker 3: been weeded out, twenty twenty four the congressional legislatory actors
Speaker 3: might come in and do something for your industry. Yeah.
Speaker 4: No, absolutely.
Speaker 10: I think the politics around crypto are shifting more in
Speaker 10: favor of the technology. As you mentioned, we have presidential
Speaker 10: candidates that actually had a debate in New Hampshire on
Speaker 10: this issue just last night, but it also came up
Speaker 10: in the Republican debate with a question with for bag
Speaker 10: Gramaswami and Montsantis. Also seeing congressional candidates include crypto positions
Speaker 10: in their policy platforms, and I think with the next election,
Speaker 10: we're going to see more candidates who are elected to
Speaker 10: Congress who have a better understanding of this technology and
Speaker 10: why it's important for the United States to be competitive
Speaker 10: with this and so I think as we get closer
Speaker 10: to the election, I think the tide is going to turn.
Speaker 10: Certainly doesn't mean we don't have those in Congress right
Speaker 10: now that are not excited about crypto. That is natural
Speaker 10: to have, you know, folks on both sides of the issue.
Speaker 10: But I think increasingly the trend is in favor of
Speaker 10: the technology and the community and the ecosystem, and so
Speaker 10: I think twenty twenty four is really going to be
Speaker 10: sort of a turnaround year for the crypto industry and
Speaker 10: we're very excited about that.
Speaker 3: Kristen, does the Blockchain Association have a scenario for each
Speaker 3: potential outcome? So if Biden is or is not re elected,
Speaker 3: or there is a new administration in the White House,
Speaker 3: do you see different avenues or paths forward for your industry?
Speaker 10: Yeah, Well, I think there are are a couple of
Speaker 10: key factors. I mean, a lot of personnel is policy,
Speaker 10: and so the people who are appointed are nominated, I
Speaker 10: should say, and then confirmed by the Senate to run
Speaker 10: the independent agencies like the SEC and the CFTC have
Speaker 10: an incredibly important role to play, and so I think,
Speaker 10: you know, whether it's Biden or somebody else, you know,
Speaker 10: Gary Gunsler's not going to be at the SEC forever,
Speaker 10: and so we will see some changes at some point,
Speaker 10: and so figuring out who those people are going to
Speaker 10: be is incredibly important. But you know, we're also looking
Speaker 10: at Congress. I think, you know, if the Senate flips,
Speaker 10: that could have a huge impact. If the House flips,
Speaker 10: that could have a huge impact. So yeah, we do
Speaker 10: a lot of scenario planning. But I think the most
Speaker 10: important thing that we're focused on right now with the
Speaker 10: Blockchain Association is really getting the education across to policy makers,
Speaker 10: Like this is an incredibly complex space. It's not something
Speaker 10: that you can talk about in one conversation and have
Speaker 10: everybody understand what the technology can do and what the
Speaker 10: issues are. And so, you know, regardless of whether Republicans
Speaker 10: or Democrats are in control of the White House or Congress,
Speaker 10: I think there's a pathway forward to having you know,
Speaker 10: sort of reasonable, successful policy, and the core the key
Speaker 10: to that is having the right the right kind of
Speaker 10: education and that that's where we're doing a lot of
Speaker 10: our focus in twenty Wow.
Speaker 2: How hard is that education made when one of the
Speaker 2: most powerful executives and suddenly in banking, Jamie Diamonds, saysage
Speaker 2: shut it down if he was in power when it
Speaker 2: comes to bitcoin.
Speaker 10: Yeah, you know, it's it's it's interesting to see Jamie
Speaker 10: diamond on the same side as Elizabeth Warren. I mean,
Speaker 10: Elizabeth Warren is supposed to be against the big banks,
Speaker 10: and it's very clear they're in cahoots. So I think
Speaker 10: the fact that he said that is is uh, raised
Speaker 10: his eyebrows among you know, certain folks that don't know
Speaker 10: a lot about this space, because it seems sort of
Speaker 10: counterintuitive to have those two that are on the same
Speaker 10: side on this front. And so you know, I think
Speaker 10: I think it actually is a conversation starter and allows
Speaker 10: us to come in and talk about this because you know,
Speaker 10: half of it is you know, getting the attention, uh,
Speaker 10: you know of the policy makers, and this is certainly
Speaker 10: an opportunity for that.
Speaker 2: Certainly caused a few headlines that one Blockchain Association CEO
Speaker 2: Chris the Smith always great tab you on to reflect
Speaker 2: on the industry all right.
Speaker 3: Coming up on the program, there's a new satellite in town,
Speaker 3: well in space that can track national threats in orbit.
Speaker 3: We're going to talk with Evan Rodgers, CEO of the
Speaker 3: startup True Anomaly that's up next. This is Bloomberg Technology.
Speaker 4: Time now for our VC roundup.
Speaker 2: General Atlantic, the investment firm whose bets have included Facebook,
Speaker 2: now Meta, Airbnb, where it's confidentially filed for an IPO itself.
Speaker 2: According to sources, the firm is considering listening as soon
Speaker 2: as next year, depending on those market conditions. Meanwhile, Changshin
Speaker 2: Memory Technologies is delaying its own IPO and when instead
Speaker 2: consider raising funds privately at about a nineteen and a
Speaker 2: half billion dollar valuation. So the latest Chinese company to
Speaker 2: call of a debut because of volatile market conditions. Meanwhile,
Speaker 2: Essential Ai it's an ay I start up founded by
Speaker 2: two authors of a seminal research paper over at Google.
Speaker 2: It's raised fifty six and a half million dollars in
Speaker 2: new funding led by March Capital. The company will use
Speaker 2: AI for corporate functions like data analysis and automating pretty
Speaker 2: monotonous tasks.
Speaker 3: Ed, all right, let's set out space True Anomaly a
Speaker 3: US startup designing military and intelligence space reconnaissance systems raised
Speaker 3: one hundred million dollars from investors to ramp up its
Speaker 3: output of a satellite that can track national threats in orbit.
Speaker 3: Right Ventures led the series be round, with participation from
Speaker 3: Eclipse Ventures, ACME Capital, and Menlo Ventures joining us. Now delighted,
Speaker 3: says true Anomally CEO and co founder Evan Rodgers. Let's
Speaker 3: start with Jackal, the AOV, but the system more broadly
Speaker 3: explained the technology to.
Speaker 5: Us, Yeah, thank you, ed. So, Jackal is what we
Speaker 5: call on our economous orbital vehicle designed to fly in
Speaker 5: close proximity safely to other satellites as its own onboard
Speaker 5: propulsion capability. That's a chemical system and is equipped with
Speaker 5: five different cameras that allow us to maneuver safely and
Speaker 5: image other satellites at a high resolution pretty much in
Speaker 5: any orbital lighting conditions, whether it's an eclipse or whether
Speaker 5: it's fully lit by the sun. It's designed at a
Speaker 5: cost point that allows these systems to be proliferated at
Speaker 5: a scale that's so far been unachievable by the defense
Speaker 5: industrial base that's been supporting the Space Force and the
Speaker 5: intelligence community to date, So.
Speaker 3: If I'm the US government or I'm Space Force, how
Speaker 3: do I get access to JACK or how do I
Speaker 3: use it? And what are the threats in orbit that
Speaker 3: I'm trying to gather data on?
Speaker 5: Well, the Space Force is thinking about transacting with the
Speaker 5: private sector in a variety of ways. We ultimately want
Speaker 5: to transact with the DoD in a way that allows
Speaker 5: us to align incentive so the true nominally can assume
Speaker 5: some of the technical risk that allows us to target
Speaker 5: margins that are interesting to particularly defense investors for future rounds.
Speaker 5: The Space Force hasn't made it very very clear what
Speaker 5: they intend to transact on a typical firm fixed price
Speaker 5: contractor or delivering the satellite for commercial operations or for
Speaker 5: government operations. The Space Force is working on a strategy
Speaker 5: to date to think through that, and we hope to
Speaker 5: be part of the conversation there.
Speaker 3: One partnership you do have is you're going to ride
Speaker 3: on SpaceX at some point next year on your first mission.
Speaker 3: What's that experience like working with SpaceX and the ride
Speaker 3: share context to get out to orbit.
Speaker 5: SpaceX has been an absolutely fantastic partner. You know, the
Speaker 5: reality is that SpaceX has provided launch at a cost
Speaker 5: where companies like trinomily can get ready access to space
Speaker 5: at a price point that doesn't break the bank. Ten
Speaker 5: years ago, a company like trinomially couldn't exist because an
Speaker 5: ecosystem of capabilities and infrastructure and subsystems didn't exist. For
Speaker 5: ture only to have access to a supply chain that
Speaker 5: really has been matured by low cost launch.
Speaker 2: We're working with SpaceX and indeed well the US government.
Speaker 4: What is the US government as an institution like to
Speaker 4: deal with.
Speaker 5: That's a great question, Caroline. It's a complicated relationship. The
Speaker 5: DoD really has responded very positively to what Tronomi is building.
Speaker 5: This company was founded by four co founders that spent
Speaker 5: ten years each in the United States Space Force and
Speaker 5: the Air Force Space as space operations officers. We saw
Speaker 5: the transition of the DoD thinking about the space domain
Speaker 5: as a peacetime domain to thinking about it as a
Speaker 5: war fighting domain, and what we recognized is that that
Speaker 5: required a new defense industrial partner explicitly focused and purpose
Speaker 5: built for thinking about protecting the infrastructure that is in
Speaker 5: space that we've spent hundreds of billions of dollars as
Speaker 5: the United States and allies fielding and that really is
Speaker 5: the backbone of global commerce and intelligence. So they've responded
Speaker 5: very positively, and at the end of the day, it's
Speaker 5: incumbent on turronomily to demonstrate that we can actually build
Speaker 5: and fly safely the systems that we have designed.
Speaker 2: And so, really this unnerving future that you paint of
Speaker 2: war in space is that what it ends up looking
Speaker 2: like is a protection of one's assets out there, rather
Speaker 2: than it becoming some ultimate sort of war zone that
Speaker 2: immediately makes one kind of go to Hollywood in one's
Speaker 2: mind's eye at least.
Speaker 5: Yeah, science fiction is sort of a complicated set of
Speaker 5: imaginaries around this and isn't always useful. The truth is
Speaker 5: that our adversaries have spent the last twenty years building
Speaker 5: an arsenal of counterspace weapons designed to target and destroy satellites,
Speaker 5: and that puts the United States and its allies ability
Speaker 5: to project power globally significantly at risk. And these weapons
Speaker 5: are really conventional weapons, everything from missiles that are designed
Speaker 5: to be launched from the surface of the Earth to
Speaker 5: satellites that are designed to attack other satellites. Nobody wants
Speaker 5: a conflict that extends into space. If we have to
Speaker 5: fight that conflict. It needs to be done in a
Speaker 5: way that ultimately doesn't generate debreathe that prevents the access
Speaker 5: to space for future generations. So we can't the words
Speaker 5: have a pyrrhic victory what General Saltzman, who's the chief
Speaker 5: of Space Operations, calls a pyrig victory. The ideal outcome
Speaker 5: is to terrence where we have an infrastructure in the
Speaker 5: space domain, the ability to gather information about what our
Speaker 5: adversaries are doing, to hold them accountable, so that we
Speaker 5: can hold them account on the public stage, understand the
Speaker 5: next creation of systems that need to be built, and
Speaker 5: ultimately deter evan.
Speaker 3: This was a very oversubscribed round one hundred million dollar
Speaker 3: Series B. I know you're yet to reach unicorn status,
Speaker 3: but what we use the cash for? How do you
Speaker 3: grow this year?
Speaker 5: And we're really focused on delivering against the contracts that
Speaker 5: we've signed. To date, we've had pretty exceptional revenue and
Speaker 5: orders traction. We have some really exciting announcements that will
Speaker 5: come out in the next couple of months. Around that,
Speaker 5: I'm focused on investing in the team and delivering the
Speaker 5: product and scaling production.
Speaker 10: A right true.
Speaker 3: Normally CEO and CO founder Evan Rogers call sign Jolly,
Speaker 3: I'm told from his time in the Space Force. Thank
Speaker 3: you for your time here on bloom bed technology.
Speaker 2: Let's go back to talking space and because missions are
Speaker 2: always physically taxed for astronauts, but those months long trips
Speaker 2: away from friends, from family, they can also take a
Speaker 2: really heavy emotional and mental toll on one's well being.
Speaker 2: That's why hgc VIVE and its partners has sent the
Speaker 2: first virtual reality headset for mental health usage to the
Speaker 2: International Space Station. The headset is currently being used by
Speaker 2: Danish astronaut Andreas Genson. Here to tell us a little
Speaker 2: bit more about bridging the gap between the science and
Speaker 2: mental health is Dan O'Brien. He's ahualc VIVE President of
Speaker 2: the Americas. And Dan, what is complex? What is difficult
Speaker 2: about sending such equipment to space?
Speaker 9: Well, it's actually very challenging. One we use gravity for
Speaker 9: pretty much all of our technology on the ground and
Speaker 9: in space, we actually had to account for zero gravity
Speaker 9: and actually have a point of reference so that we
Speaker 9: don't have things like drifting away inside of a space station.
Speaker 9: So just the technological achievement to actually send something into
Speaker 9: space like this was pretty amazing. But it's also again
Speaker 9: just like you said, on the mental health side, the
Speaker 9: rigors of space is actually pretty isolating, very distracting, and
Speaker 9: it's very challenging for the astronauts. They're dealing with stress
Speaker 9: in minutes, you know, of what we deal with kind
Speaker 9: of in hours or weeks or years. So it's a
Speaker 9: very high stress environment. So we want to actually put
Speaker 9: this product up there so that we could measure how
Speaker 9: we can make it a more efficient and productive environment
Speaker 9: for our astronauts.
Speaker 3: Dan, I've spent many more hours this year using virtual
Speaker 3: mixed augmented reality with my feet firmly planted on the
Speaker 3: ground and Earth. I'm sure you have as well. Yes,
Speaker 3: all their differences from the experience the astronauts go through
Speaker 3: of a virtual reality environment in zero gravity, what if
Speaker 3: they relate to you.
Speaker 9: I think you can look at they're doing a lot
Speaker 9: of video experiences as opposed to something that you might
Speaker 9: be just walking around and experiencing. But you can see
Speaker 9: here they actually do a lot of on ground training.
Speaker 9: So here the commander you know, and that video was
Speaker 9: actually doing all of the spacewalk experiences and training before
Speaker 9: he went into that environment. So what we do on
Speaker 9: Earth is the ability to actually do a lot of
Speaker 9: training simulation with our healthcare applications, a lot of high
Speaker 9: stress training that we can use across a lot of verticals,
Speaker 9: not just for NASA, but for first responders, healthcare, defense,
Speaker 9: and education. So we actually have a lot of ways
Speaker 9: that we can use it on Earth that we can't
Speaker 9: use it in the space station, but we can actually
Speaker 9: bring those astronauts a lot of experiences that will just
Speaker 9: bring them a lot of calm and serene that they
Speaker 9: can use inside of that environment.
Speaker 3: Then what's the HTC getting out of sending a headset
Speaker 3: up to zero gravity environments?
Speaker 9: Well, I think there's a lot for us to always learn.
Speaker 9: We're an innovation company that delves into hardware and software
Speaker 9: and we have been delivering new technology for the industry
Speaker 9: for many years. We were the first company to bring
Speaker 9: you a four GLT device or touchscreen device with our smartphones,
Speaker 9: and then we were the first company to bring you
Speaker 9: things like a full room scale walking around virtual environment.
Speaker 9: So for us, it's always about being the innovation leader
Speaker 9: in every aspect. And what we're learning now in space
Speaker 9: and being able to actually have an object in space,
Speaker 9: it teaches us a lot about different environments that we
Speaker 9: can actually bring a virtual scenario to. But it's also
Speaker 9: about that training and simulation. We can actually do a
Speaker 9: lot in that space station with our headset and our technology.
Speaker 4: Leader doesn't always mean winner.
Speaker 2: And when we think of vr AR, certainly for this year,
Speaker 2: one goes to meta then one goes to at least the.
Speaker 4: Announcement coming from Apple.
Speaker 2: Sure, do you feel that market share will ultimately be
Speaker 2: yours by being a leader.
Speaker 9: To Well, it's always good to be first, right, But
Speaker 9: at the same time, we are the reference designed for
Speaker 9: so many of those other companies. They usually follow us
Speaker 9: about a year behind us, whether it comes to wireless,
Speaker 9: connectivity and technology. But even looking at Apple, like their
Speaker 9: headset that they're going to announce is already behind and
Speaker 9: what is actually coming out when we look at Meadow,
Speaker 9: they have a different, completely different business model. You know,
Speaker 9: they're looking at the users, the product, they're looking at,
Speaker 9: you know, selling ads. In the metaverse, we're a company
Speaker 9: that actually stands for technology, innovation, humanity. So what we're
Speaker 9: actually trying to accomplish with our brand and our technology
Speaker 9: is actually bringing products and solutions that will actually benefit
Speaker 9: humanity and our users, whether they're consumers or commercial users.
Speaker 4: Cutting face a meta. We thank you for that.
Speaker 2: Dan O'Brien really talking about the marketing landscape and indeed,
Speaker 2: more broadly, the landscape for ARVR is of course HDC
Speaker 2: Vibe President of the Americas. Then that does it for
Speaker 2: this addition of Bloomberg Technology. Has been a lot about
Speaker 2: space air as always fifty percent in orbit, fifty percent
Speaker 2: on a there's a lot of recap.
Speaker 3: Thank you to everyone that's listening to the podcast wherever
Speaker 3: you're getting your podcasts, Apple, Spotify, iHeart, and we post
Speaker 3: them every day on all of the Bloomberg platforms. Really
Speaker 3: really appreciate the feedback on that one from San Francisco
Speaker 3: and out in New York City. Here on planet Earth.
Speaker 3: This is Bloomberg Technology.