Speaker 1: Bloomberg Audio Studios, podcasts, radio news. Bloomberg Tech is alive
Speaker 1: from coast to coast, with Caroline Hide in New York
Speaker 1: and Ed Lovelow in Sent Francisco.
Speaker 2: This is Bloomberg Tech coming up.
Speaker 3: US auto safety regulators probe Tesla over issues with door
Speaker 3: handles on certain vehicles following a Bloomberg report.
Speaker 4: Plus, Google will invest close to seven billion dollars over
Speaker 4: two years in the UK to help build its AI economy, and.
Speaker 3: Service now expands its presence in Florida with a new
Speaker 3: regional hub. We speak with the CEO and with the
Speaker 3: developer of the.
Speaker 4: Site, but first we check out what's happening in the markets.
Speaker 5: We are so close to ten.
Speaker 4: Straight days of gains on the NASA one hundred. There's
Speaker 4: a blip. We pull just slightly into the negative territory.
Speaker 4: And then as that one hundred only slightly ed, what
Speaker 4: is it? Thirteen points? Much anxiety as we go into
Speaker 4: the federal reserve policy. The decision comes tomorrow, will we
Speaker 4: see a cut? But what about the future direction? As
Speaker 4: those retail sales look pretty buoyant, can they be as
Speaker 4: dubvish in the longer term? But Ed, you're looking at
Speaker 4: perhaps what moves the markets on.
Speaker 5: This exact day.
Speaker 2: Yeah, let's go to our top story.
Speaker 3: US auto safety regulators opened up an investigation into whether
Speaker 3: some Tesla vehicle doors are defective. This comes days after
Speaker 3: a Bloomberg investigation uncovered a series of incidents in which
Speaker 3: people were injured or died after they were unable to
Speaker 3: open doors when Tesla's lost power, particularly after crashes. I
Speaker 3: would note the stock is higher in this Tuesday session,
Speaker 3: up almost two percent. Bloomberg's Global Auto's editor Craig Trudell
Speaker 3: joins us from London. Let's start with the investigation, which
Speaker 3: is a Nitzer investigation. Craig explain the parameters of what
Speaker 3: Nitza's looking at and the scope of what they're looking at.
Speaker 6: Yeah, it's interesting, you know, the sort of headline information
Speaker 6: at the top of this document that it's an issue
Speaker 6: today refers to a pretty narrow, narrow set of vehicles.
Speaker 6: This is the twenty twenty one model Y. It's about
Speaker 6: one hundred and seventy thousand cars. But the issue here
Speaker 6: has the potential to be much broader because what NITSA
Speaker 6: is looking at is Tesla's approach to its door design
Speaker 6: and the fact that its doors are reliant on.
Speaker 2: Electrical power in order to work.
Speaker 6: That is something that applies to all Tesla's going back
Speaker 6: to the model S that's been in production since twenty twelve.
Speaker 6: So while Tesla is you know, on the surface, it
Speaker 6: looks like this is a single model, a single model year,
Speaker 6: this has the potential to be something much broader. You
Speaker 6: think back to, you know, a precedent of an autopilot
Speaker 6: investigation where they were narrowly looking at how that system
Speaker 6: handled you know, certain parameters like how they werenavigating emergency
Speaker 6: vehicles and you know, running into say, fire trucks or
Speaker 6: police cars. That didn't just stayed narrowly focused on that
Speaker 6: one issue. They had to recall autopilot.
Speaker 7: You know.
Speaker 6: Overall, right, it affected their vehicles in a much broader way.
Speaker 6: It has there is some potential for the same to
Speaker 6: play out here with this model.
Speaker 2: Why why investigation.
Speaker 4: Craig China, top regulators there have been looking at these
Speaker 4: concealed handles before. Already Europe has been thinking a lot
Speaker 4: about accidents in such cases.
Speaker 5: Is it just a Tesler design?
Speaker 4: And more broadly, how are we thinking about the US
Speaker 4: tackling it versus other regions?
Speaker 6: I think it's interesting because this is a design that,
Speaker 6: for all of its potential flaws, at least to some degree,
Speaker 6: has been embraced and sort of copied by other manufacturers.
Speaker 2: And that's something that we included in our.
Speaker 6: Report last week that a lot of electric vehicle you know,
Speaker 6: rivals or would be rivals to Tesla that have come
Speaker 6: onto the market over the years have kind of embraced
Speaker 6: this you know, flush door handle design, essentially kind of
Speaker 6: innovating a door handle that maybe didn't need to be innovated,
Speaker 6: and that is something that will be you know, very
Speaker 6: interesting for us to watch here because we also included
Speaker 6: in last week's report mentioned of the fact that we've
Speaker 6: already seen recalls related to the safety of door handles
Speaker 6: in for instance, the Mustang Machie, the Ford SUV that
Speaker 6: is taking on the Model Y. So this has the
Speaker 6: potential to be not only a broader investigation for Tesla,
Speaker 6: but also something that knits A takes a closer look
Speaker 6: at across all manufacturers that have taken after Tesla from
Speaker 6: this design perspective.
Speaker 3: After NITSA confirmed its investigation this morning, Tesla has not
Speaker 3: responded to request a comment from Bloomberg, but We just
Speaker 3: showed Craig while you were speaking the comments of Tesla's
Speaker 3: board chair Robin Denholm, which will remember Karen and I
Speaker 3: are posed too after our original report has been in
Speaker 3: vers Cray Trudell out of London.
Speaker 2: Thank you very much.
Speaker 3: Going back to the UK, Google will invest five billion
Speaker 3: dollars that's six point five billion pounds storry, that's six
Speaker 3: point eight billion dollars over two years into the UK
Speaker 3: to help build an AI economy in the country. The
Speaker 3: tech giant disclosed the plan just as President Trump is
Speaker 3: set to announce billions of dollars of economic deals during
Speaker 3: his visit to the UK this week. He's expected to
Speaker 3: travel with several US tech leaders, including in Nvidio CEO
Speaker 3: Jensen Wang and open Ai CEO Sam Altman. Bloomberg's UK
Speaker 3: correspondent Lizzie Burden joins us and Lizzie give us the
Speaker 3: need to know on this alphabet deal and what else
Speaker 3: we're looking forward to.
Speaker 8: Well, as you both know, this alphabet deal is a
Speaker 8: drop in the ocean in terms of the capex of alphabets,
Speaker 8: but it's a big deal for the UK. It's something
Speaker 8: that's been long in the making. The UK tech Secretary
Speaker 8: is the former one. Peter Kyle is now the UK
Speaker 8: Business and Trade Secretary, perhaps as a sign of just
Speaker 8: how important tech is to the business landscape here in
Speaker 8: the UK.
Speaker 5: But as you say, it's part of a broader suite.
Speaker 8: Of economic deals that we're expecting the President to announce
Speaker 8: here on his visit to Britain. We're expecting ten billion
Speaker 8: pounds worth of deals to be announced, including a defense
Speaker 8: tech cooperation agreement, also partnership on nuclear also bringing together
Speaker 8: the economic hubs on both sides of the Atlantics. There's
Speaker 8: a lot of stake here for Keir Starmer. It's an
Speaker 8: unprecedented second state visit for Donald Trump here in Windsor
Speaker 8: this eleventh century castle behind me. But I have to
Speaker 8: say this is the worst possible timing for Keir Starmer.
Speaker 8: He's just lost his UK Ambassador to the US, Peter Mandelson,
Speaker 8: over his links to Jeffrey Epstein. Epstein of course links
Speaker 8: to the King himself via his brother Prince Andrew, and
Speaker 8: to Donald Trump. So there are going to be some
Speaker 8: very very awkward moments, not least at the press conference
Speaker 8: at the end of the trip. For the UK, the
Speaker 8: point will be to not look like we're appeasing the President,
Speaker 8: but also to make sure that something substantive comes out
Speaker 8: from this visit, because ultimately the UK is playing its
Speaker 8: age by deploying the King.
Speaker 4: Bloomberg's Lizzie Burden from Windsor Castle. We appreciated. Let's return
Speaker 4: to the tech deals that we're expecting to come out
Speaker 4: of that visit and the focus on AI with Leeds Hue,
Speaker 4: chief Investment Officer for Thematic Innovation Equities and Alliance Burnsteam
Speaker 4: and more.
Speaker 5: This fits into the whole.
Speaker 4: Array of conversation we keep having about the need for
Speaker 4: investment in air. We just think back to Oracle's numbers
Speaker 4: last week and how much they were showing that they've
Speaker 4: got this backlog building. We've got all the hyperscalers trying
Speaker 4: to build out, Alphabet's looking to build a data center
Speaker 4: in the UK. Are we seeing that continuing to go
Speaker 4: up into the right at the speed that we see
Speaker 4: at the moment, Well.
Speaker 9: I think all we're seeing is actually we're hitting an
Speaker 9: inflection point in inferencing. So you look, it's just broadly speaking,
Speaker 9: not just those big numbers that you quoted, but also
Speaker 9: if you look the AI trend and the adoption and
Speaker 9: where we're seeing the step function and numbers is broadening out,
Speaker 9: so it's a broader set of companies that are starting
Speaker 9: to benefit, whether it's the networking companies or we're seeing
Speaker 9: it in memory pricing, in storage, in hardware. So those
Speaker 9: are all signs that you know, in terms of the
Speaker 9: AI adoption, the inferencing at the edge, things are actually happening,
Speaker 9: and to me, this is a very positive sign. That
Speaker 9: means the real adoption which will drive continued build So
Speaker 9: we think about it tech innovation generally, we take step functions, right,
Speaker 9: We kind of chuck along and then all of a
Speaker 9: sudden there's an inflection point and things really start to
Speaker 9: take off. And I really think we are still in
Speaker 9: the early innings of that happening, and supported by all
Speaker 9: the evidence that we have seen at the micro level
Speaker 9: from the company as well as these mega trends that
Speaker 9: you're seeing at you know, the big macro level.
Speaker 4: The step function has already been shown in the valuations
Speaker 4: of companies. We just want to bring you some sound
Speaker 4: actually from a key investor who manages money for Peter
Speaker 4: til no Less. We've been talking about how we've been
Speaker 4: looking at maybe a bubble growing an ai.
Speaker 5: Just take a listen.
Speaker 10: The AI bubble is real, and I don't take enough
Speaker 10: people talk about it. And if you were able to
Speaker 10: be an early investor in open ai, then congratulations, that's
Speaker 10: a great place to be. If you're coming and investing
Speaker 10: at open ai at a five hundred million dollar valuation,
Speaker 10: I honestly.
Speaker 2: Don't know about that.
Speaker 10: So I think that is the more dominant topic that
Speaker 10: is going on, at least within Silicon Valley circles. It
Speaker 10: doesn't get talked about enough. And how it chicks out,
Speaker 10: it's going to be fascinating because if you got in early, fantastic.
Speaker 10: If you're getting in today, I'm not assured.
Speaker 4: Long time sort of managing director for the private wealth
Speaker 4: of Peter Teel, but also with AZVC founder Jack Selby,
Speaker 4: there are you worried about any exuberance already reflecting evaluations
Speaker 4: even though we are at this inflection point.
Speaker 9: I think that brings it interesting point. Valuation is important,
Speaker 9: and we always said valuation is important, but it's only
Speaker 9: related to interestal customer revisions. So not all companies are
Speaker 9: going to succeed. There will be a lot of company
Speaker 9: that simply put the name in their press release, and
Speaker 9: those are the ones that we say, oh, that's AI too.
Speaker 9: So it actually brings back to we have to do
Speaker 9: our due diligence. Some of them will succeed, many of
Speaker 9: them will fail. Even if you look back to the
Speaker 9: web one dot right, there were so thousands of companies,
Speaker 9: but really a few survived and those are the leaders today.
Speaker 9: And as we look forward, I would say AI is transformative.
Speaker 9: We are early and leadership is being redefined. And that's
Speaker 9: why all the companies are rushing out to spend because
Speaker 9: it's as defensive as it is offensive. But we will
Speaker 9: find new leaders but in the meantime we'll also have
Speaker 9: to be prudent. Not all of them are going to succeed.
Speaker 9: And in fact, when you redefine the future of leadership,
Speaker 9: when there's a paradigm change, some of the things that
Speaker 9: we use to think that work may not work. So
Speaker 9: what is perceived to be cheap could also be more
Speaker 9: expensive than you expect it. So again brings back to
Speaker 9: we've got to do our homework. It's easy to call
Speaker 9: everything a bubble, but underneath that, actually there are opportunities,
Speaker 9: but they are also you know, prudence is absolutely important.
Speaker 3: Lay the other counterpoint to a bubble argument is that
Speaker 3: different geographies are moving at different speeds. This week exemplifies that.
Speaker 3: Does it not that you see earlier announcements for a
Speaker 3: buildout of infrastructure in the United Kingdom given that we
Speaker 3: haven't seen the same level of activity in Western Europe
Speaker 3: the United Kingdom? Does the Lions burnsteam change its attitude
Speaker 3: towards British equities, UK equities, European equities in that AI
Speaker 3: infrastructure supply chain.
Speaker 9: I think AI is a global phenomenon, but it's more
Speaker 9: so just tech. Innovation has become a crucial element in
Speaker 9: national success. So it is something that we watch closely.
Speaker 9: And I think in terms of each country the adoption
Speaker 9: of AI, it reflects the readiness of the infrastructure, the
Speaker 9: readiness of the government, But oftentimes it ultimately comes down
Speaker 9: to a private public together initiative, and there will be opportunities.
Speaker 9: We've seen sovereign being a big driver for spend and
Speaker 9: I expect to see that continue going forward. And I
Speaker 9: also think each country will take a very different approach
Speaker 9: because the budget is different, the willingness is different.
Speaker 3: Lay very quickly, how close are you tracking private markets
Speaker 3: and private companies that are active here?
Speaker 9: It's very very important for us because a big part
Speaker 9: of the AI adoptions is happening in the private market.
Speaker 2: And now to.
Speaker 9: Mention, if you look at these hundreds of billions of
Speaker 9: dollars they need to be financed. A big part of
Speaker 9: the financing is being done on the private side, monitoring
Speaker 9: that trend very closely, both on the demand side and
Speaker 9: in terms of financing which support the supply side.
Speaker 3: Late of alien spurn seen. Great to have you back
Speaker 3: on the program, Thank you very much. Now coming up,
Speaker 3: the CEO of Service Now and developer Related Ross joins
Speaker 3: us to discuss efforts to turn West Palm Beach into
Speaker 3: an AI hub.
Speaker 2: Carry what are you looking at?
Speaker 4: I'm actually still looking at those valuations on the publicly
Speaker 4: traded side. Oracle, I mean key player when it comes
Speaker 4: to AI infrastructure cours up one and a half percent.
Speaker 4: This is on the back of its earnings last week,
Speaker 4: but also as the narrative around TikTok continues to unfold.
Speaker 4: Will they remain a key cloud provider, an infrastructure provider?
Speaker 4: Could they even take a necty stake for at one
Speaker 4: point se percent? This is Broomberg Tech.
Speaker 3: Service Now is expanding its presence in Florida with a
Speaker 3: new regional innovation hub, an AI Institute in West Palm Beach.
Speaker 3: The developer of the site is Related Ross, run by
Speaker 3: Stephen Ross. He's known for the Hudson Yards redevelopment project
Speaker 3: and of course ownership of the Miami Dolphins. Stephen Ross
Speaker 3: and Service Now CEO Bill McDermott join us now, gentlemen,
Speaker 3: Good morning. Thank you for joining us here on Bloombo Tech. Bill,
Speaker 3: it's great to have you back on. Start with the
Speaker 3: Service Now piece. You know, in this environment, Bill, where
Speaker 3: there's such a micro focus on the talent in AI
Speaker 3: and where companies are spending resources, why does this position
Speaker 3: Service Now better to have this footprint in Florida.
Speaker 11: Well, there's no artificial intelligence without human intelligence, said, and
Speaker 11: there's no leader that can develop a project and a
Speaker 11: dream are better than Stephen Ross. And you mentioned the
Speaker 11: Hudson Yards, but he also did the Time Warner Center.
Speaker 11: And we've been friends for a long time. And I
Speaker 11: always felt the trust was the ultimate human currency and
Speaker 11: it's still is. And I believed in his dream and
Speaker 11: what I see happening here is we're building an AI institute,
Speaker 11: and in this institute, we're going to have the most
Speaker 11: innovative engineers in the world. We're going to be able
Speaker 11: to prototype solutions for the public and private sector at
Speaker 11: record pace, and then we're going to move those solutions
Speaker 11: out into the market. We're also creating knowledge university, and
Speaker 11: we're going to put the flag right here in West
Speaker 11: Palm Beach to rise up three million people in our
Speaker 11: economy to the AI world so they can get the
Speaker 11: better paying jobs, the creative jobs where only humans can
Speaker 11: really excel. And I underscore we really believe it's all
Speaker 11: about putting AI to work for people, because we're a
Speaker 11: job creator and we believe that AI has to be
Speaker 11: in service to people, and right in West Palm Beach
Speaker 11: we're role modeling that.
Speaker 3: Mister Ross, you have a vision that West Palm Beach
Speaker 3: becomes an AI hub more than just service. Now, how
Speaker 3: difficult is it to vince the technology industry of your vision?
Speaker 2: And why West Palm Beach, Well.
Speaker 12: I mean West Palm Beach is really because of Florida
Speaker 12: being the great business state it is, and knowing that
Speaker 12: South Florida is different than the rest of Florida and
Speaker 12: it's really poised to growth and attract jobs. It's never
Speaker 12: done that before. It's always been second homes, you know,
Speaker 12: the second home to all South America, if you will.
Speaker 12: But right now, the resources of Florida, there's not a
Speaker 12: better business state. And when you look and see where
Speaker 12: people are going in the change that's occurring in this country,
Speaker 12: there's no place better positioned. So we had to really
Speaker 12: put it together to bring those things that Florida didn't
Speaker 12: have to attract business. And that's what we've been concentrating on.
Speaker 12: And fortunately now I mean Bill and his vision which
Speaker 12: is second to none. Really saw, at least in our opinion,
Speaker 12: and I'll take that most people's opinion, but saw the
Speaker 12: possibilities and how South Florida was really different than any
Speaker 12: other place in the country. There's not a better business
Speaker 12: state in Florida to start with. So we're very fortunate.
Speaker 4: Bill eight hundred and fifty jobs over the next five years,
Speaker 4: talking about one point eight billion dollars in economic impact.
Speaker 4: You're big on training and training people with service now.
Speaker 5: But will some of your employees move over? How much
Speaker 5: are they wanting to come to the Gold Coast?
Speaker 11: I would say we'll have a twenty percent of our
Speaker 11: workforce likely relocate. The demand to do that has been unbelievable.
Speaker 11: And I keep reminding people the office gets completed in
Speaker 11: twenty twenty seven, so just relax. But the demand is there.
Speaker 11: I think it'll be eighty percent net new job.
Speaker 2: So you look at.
Speaker 11: Florida, amazing universities across Florida, look at our veterans. We're
Speaker 11: going to cross train our veterans on our open AI
Speaker 11: opportunity and they're going to get excited and this is
Speaker 11: going to be a great place for them to grow
Speaker 11: and prosper people that want to switch jobs and go
Speaker 11: into this industry because it's flourishing. You know, the jobs
Speaker 11: are going to get created in tech companies like service Now,
Speaker 11: and we keep hiring, We're growing, we're hiring, we're prospering
Speaker 11: because the innovation is second to none. And you know
Speaker 11: something you know that's very well Carolina and ed. This
Speaker 11: platform connects to every cloud, it connects to every learning
Speaker 11: and every AI model, and it connects.
Speaker 2: To every data source.
Speaker 11: So this will be the AI platform for business transformation.
Speaker 11: And the opportunity has never been greater than it is
Speaker 11: right now. And I'm excited to do this with my
Speaker 11: great friend Steve and really really grow the company, especially
Speaker 11: in West Palm Beach for the great state of Florida,
Speaker 11: and I want to say Governor DeSantis, Mayor James Stephen Ross,
Speaker 11: all of us work very hard behind the scenes to
Speaker 11: make this moment a reality.
Speaker 4: Stephen, that reality is mixed use residential, retail, office properties
Speaker 4: in this particular focus.
Speaker 5: What about data centers?
Speaker 4: Are you thinking about the future of Florida there? I
Speaker 4: know very much West Palm Beach is a place to
Speaker 4: live and to thrive. But where will your opportunities go
Speaker 4: next when it comes to technology.
Speaker 12: Well, first of all, all we're just starting and really
Speaker 12: had to really develop the base for them to see
Speaker 12: the opportunities here. So we really concentrated on bringing great
Speaker 12: universities like Vanderbilt that are coming here with their business engineering,
Speaker 12: tech with schools, and then we had to bring in
Speaker 12: a hospital. We have Cleveland Clinic, and so we're bringing
Speaker 12: all those things that are necessary K through twelve education
Speaker 12: to attract companies. And that's what we've been concentrating on
Speaker 12: and working with the city and the county and the
Speaker 12: state that will really make this a place where companies
Speaker 12: really want to relocate because they can attract the best talent.
Speaker 3: Mister Ross, thank you for that Bill, I think a
Speaker 3: very reasonable question that your employees are going to have
Speaker 3: is whether the you yourself are going to make the
Speaker 3: move to Florida and other members of leadership will make
Speaker 3: the move if you believe so much in this vision
Speaker 3: of the future for West Palm Beach.
Speaker 11: Well, you have to remember we have a very large
Speaker 11: commitment to the state of California where we started the
Speaker 11: company in both San Diego and Santa Clara, California, which
Speaker 11: is where I'm based. But we will have executive leaders
Speaker 11: on the top management team that will be domicile here
Speaker 11: in West Palm Beach and will be part of this
Speaker 11: amazing revolution. And I will spend a lot of time
Speaker 11: the time, the discretionary time that I can here because
Speaker 11: I really want people to know we planted a flag today.
Speaker 11: This is a flag of opportunity, a flag of growth,
Speaker 11: and leadership starts at the top. And I've always believed
Speaker 11: that the true measure of a leader is not what
Speaker 11: you take from this world, is what you give it.
Speaker 11: And today's service now gave it a lot. We came
Speaker 11: in here and Kelly, who runs Palm Beach County Business Development,
Speaker 11: set on stage. This is the biggest corporate move into
Speaker 11: this area in Palm Beach County in the last thirty years.
Speaker 11: I'm super proud of that, and i want to make
Speaker 11: this a stunning success. So I'll be where I need
Speaker 11: to be, the leadership team will be where they need
Speaker 11: to be. But the main thing is to build a
Speaker 11: masterpiece of flywheel of growth and innovation.
Speaker 2: I've already received several techs.
Speaker 11: Today on this announcement from other tech companies and systems
Speaker 11: integrators that are like, Wow, what are you doing there?
Speaker 2: What's going on in West Palm.
Speaker 4: Bill, We'll see who comes on to say they're moving next.
Speaker 4: Bill McDermott, CEO of Service Now Stephen Ross, CEO related Ross.
Speaker 5: Great to have you both. It's time now for talking tech.
Speaker 4: First up, Amazon satellite internet venture project Kaiper, expected to
Speaker 4: offer service in five countries, including the US by early
Speaker 4: twenty twenty six. The names to compete with Musk Starlink,
Speaker 4: and has already reached an agreement to provide on board
Speaker 4: Wi Fi for Jet Blue plus Google Well it considered
Speaker 4: selling off parts of its ad tech business to resolve
Speaker 4: monopoly charges.
Speaker 5: It's going into a lawyer for the company now.
Speaker 4: The Justice Department, however, is seeking a full divestiture of
Speaker 4: Google Google's advertising exchange.
Speaker 5: Two sides meet in a hearing next week.
Speaker 3: Welcome back to Bloomberg Tech. I'm saying here, look at
Speaker 3: the chip sector. The Philadelphia Semiconductor Index or socks were
Speaker 3: mildly soft, down a few tens five percent, but early
Speaker 3: in the session we opened higher, and if we close
Speaker 3: in the green, that would put us on track for
Speaker 3: the ninth straight day of gains on the socks, which
Speaker 3: is the longest streak since twenty seventeen.
Speaker 2: Stories there, I've put Micron in a video.
Speaker 3: Okay, video is down almost a percent in the moment,
Speaker 3: but year to date, big drivers have gained. Micron reports
Speaker 3: earning September twenty third in video. Under pressure right now,
Speaker 3: but recent momentum and the idea carr as you know,
Speaker 3: is that maybe in videos at the center of the
Speaker 3: discussions between the United States and China right now, will
Speaker 3: it come off on that phone call between the President
Speaker 3: and Jijing thing on Friday?
Speaker 2: That's the question the market's answer askame it is.
Speaker 4: Meanwhile, the market's also looking at what President Trump is
Speaker 4: doing in terms of filing a fifteen billion dollar defamation
Speaker 4: lawsuit against the new York Times, that's greater in the
Speaker 4: newspaper's market cap A so you can currently see the
Speaker 4: President is accusing The Times of serving as a.
Speaker 5: Quote mouthpiece for the Democrats.
Speaker 4: The New York Times send in a statement that the
Speaker 4: lawsuit quote has no merit and is an attempt to
Speaker 4: stifle and discourage independent reporting. That's bringing lead focus for
Speaker 4: Bloomberg's media and entertainment coverage Chris pal Mary, Chris, when
Speaker 4: you're editing stories like this, when you're thinking about driving
Speaker 4: forward the news, we have the context that is this
Speaker 4: isn't the first time President Trump has sued a reporting network.
Speaker 13: Right, I mean, in terms of our work, I mean,
Speaker 13: we always try to be tough but fair to everybody.
Speaker 13: And so this has been a tactic Trump's used for
Speaker 13: years and until he became president. Really the second time
Speaker 13: he's not been successful ensuing the media, but more recently
Speaker 13: he has been getting settlements out of ABC and CBS, Facebook,
Speaker 13: And so he's tying this in a way to his
Speaker 13: power as president to say, get the FCC to approve
Speaker 13: Paramount's merger with guidance, which happened just a week or
Speaker 13: so after they settled the CBS suit with him so
Speaker 13: you know, he's using this.
Speaker 2: It scores with his base.
Speaker 13: If you see what his truth social posts have said.
Speaker 13: It's really about, hey, they're attacking me, your president, and
Speaker 13: it's a revenue generator for his Presidential Library foundation.
Speaker 2: And lastly, he.
Speaker 13: Hopes whether that's successful not not clear at all. Is stifling,
Speaker 13: as The New York Times said, trying to get reporters
Speaker 13: not to write nasty stories about him.
Speaker 3: Chris, what is it specifically that the president is claiming
Speaker 3: in this suit? We say it's a fifteen billion dollar lawsuit,
Speaker 3: But what is it that he is accusing the New
Speaker 3: York Times of You.
Speaker 13: Know, it's interesting compared to the ABC and CVS suits,
Speaker 13: which were really specific incidences, this is much broader. It's
Speaker 13: sort of just a whole agenda he argues against him
Speaker 13: and for Kamala Harris in the last election. You know much,
Speaker 13: you know, harder when there's no specific allegation of journalistic
Speaker 13: wrongdoing here.
Speaker 3: The New York Times said in a statement, the lawsuit
Speaker 3: has no merit and is an attempt to cipher and
Speaker 3: discourage independent reporting. Bloomberg's entertainment editor, Chris Palm Mary, thank
Speaker 3: you very much, President Trump says, he'll speak with Chinese
Speaker 3: leaders Jijingping on Friday, as US and Chinese officials reached
Speaker 3: a framework deal on keeping the TikTok app running in
Speaker 3: the United States.
Speaker 2: Listen to this.
Speaker 11: We have a deal on TikTok.
Speaker 7: I've reached a deal with China.
Speaker 14: I'm going to stick to.
Speaker 15: Presidency on Friday to confirm everything up.
Speaker 3: We made a very good, great deal, and I hope
Speaker 3: good for both cutches, but a very different deal.
Speaker 7: Made in the best.
Speaker 9: We'll be announcing that we have a group of very
Speaker 9: big companies.
Speaker 6: That want to buy it.
Speaker 3: That's the President speaking ahead of traveling to the United
Speaker 3: Kingdom in summary, saying a lot of big technology companies
Speaker 3: want to buy us TikTok and that there is a deal.
Speaker 2: We'll learn more later in the week.
Speaker 3: Sarahkrep's, director of the Tech Policy Institute at Cornell University,
Speaker 3: joins us now and Sarah, you know, newsflow is one thing,
Speaker 3: but it looks like we're proceeding to a situation where
Speaker 3: a coalition of American technology companies and others will be
Speaker 3: able to keep TikTok going in the United States. But
Speaker 3: there's a big phone call on Friday, and in your analysis,
Speaker 3: and expertise of the relationship between the United States and
Speaker 3: China and the tech domain. How central is the success
Speaker 3: of that phone call to this happening.
Speaker 16: I don't think that the phone call itself is going
Speaker 16: to be what this deal hinges on. My sense is
Speaker 16: that they've already established a framework through which which the
Speaker 16: US part of TikTok will divest from the Chinese parent
Speaker 16: company Byte Dance, and I think Friday's call is really
Speaker 16: just to seal that deal and make an announcement.
Speaker 3: We cover this based in the United States, right, and
Speaker 3: work for an American news organization, but we always come
Speaker 3: at this from the US point to the negotiating table.
Speaker 3: How do you evaluate how China feels about TikTok being
Speaker 3: able to get to continue in the US but some
Speaker 3: concessions being made that would impact China and byte.
Speaker 5: Dance, right, I think this is well.
Speaker 16: I think first and foremost they would be the Chinese
Speaker 16: have made it pretty clear they do not want to
Speaker 16: sell the algorithm, that they want to separate the platform
Speaker 16: from the algorithm, because it's the algorithm that is really
Speaker 16: the secret sauce here for the whole thing, and so
Speaker 16: trying to tease those two things out. The algorithm from
Speaker 16: TikTok Usa, I think is really important to them. But
Speaker 16: then there is a lot of issue linkage going on here.
Speaker 16: There are so many aspects. So TikTok I think is
Speaker 16: part of a broader set of discussions on trade between
Speaker 16: the US and China, and so I think this is
Speaker 16: really an important part of that, but emblematic of I
Speaker 16: think what it seems Trump is trying to do, which
Speaker 16: is harmonize a little bit that relationship between the US
Speaker 16: and China.
Speaker 4: In terms of data. How safe or at least from
Speaker 4: a national security perspective, how able is US data to
Speaker 4: be now protected in some way from flowover to China,
Speaker 4: as Congress hopes.
Speaker 16: Right, that was the important thing for Congress, which is well,
Speaker 16: there were two aspects for Congress, which was one was
Speaker 16: the algorithm, which was the ability to manipulate through the algorithm,
Speaker 16: But there was always the question of data. And even
Speaker 16: without the algorithm, the data is still very powerful. As
Speaker 16: you probably remember, Cambridge Analytica never touched Facebook's algorithm, but
Speaker 16: with the raw data that they had, they built profiles
Speaker 16: of individual users, tested messages, and then micro targeted them.
Speaker 16: And the TikTok data is even more revealing than that.
Speaker 16: So it just not just posts and likes, but watch times, rewatches, pauses, shares,
Speaker 16: all those signals are an exposure of attention span, emotional triggers,
Speaker 16: hidden interests.
Speaker 11: So the.
Speaker 16: You know whatever foreign entity would perhaps still have a
Speaker 16: backdoor to that data, and so far I haven't seen
Speaker 16: anything on the technical side about how the US what
Speaker 16: part of the deal would address that possible back door
Speaker 16: access to power the powerful data.
Speaker 4: Sarah, It's so interesting because all of this comes in
Speaker 4: the broader view of US China relations and you sit
Speaker 4: at that intersection technology, geopolitics, national security is TikTok the
Speaker 4: thing that we should be that worried about when we're
Speaker 4: also looking about AI relationships.
Speaker 16: Well, it's an interesting question because you know, and I've
Speaker 16: puzzled over why Congress, which passed this law and it
Speaker 16: was signed into law, has not really pushed back on
Speaker 16: these constant extensions, because if this was such a national
Speaker 16: security threat, you would think it was a threat a
Speaker 16: year ago, and the ninety day extensions are just kind
Speaker 16: of perpetuating that threat. And I think part of the
Speaker 16: implicit realization is that we've you know, even if you
Speaker 16: address TikTok is really the tip of the iceberg, and
Speaker 16: all these other national security tech issues, including the AI question,
Speaker 16: which I think is just in some ways looms even larger.
Speaker 4: Sarah Creps of Cornell University come back to talk about
Speaker 4: the AI looming still coming up.
Speaker 5: Jack Ma returns to add to Baba with some conventions.
Speaker 5: I'm going to discuss that next. This is a blue
Speaker 5: bag tech.
Speaker 4: Jack Ma is back after banishing from public eye at
Speaker 4: the outset of an anti trust investgation in late twenty twenty.
Speaker 4: Sources say China's most recognizable entrepreneur is back on Ali
Speaker 4: Baba's campuses, and he's more directly involved than he's been
Speaker 4: in half a decade.
Speaker 5: Bromberg's Global Tech editor.
Speaker 4: Peter Elstrom joins us, Now, how is his hand being felt?
Speaker 15: Yeah, so Jack is back on the Ali Baba campuses.
Speaker 15: We've spoken with people who have seen him on the campus.
Speaker 15: He's wearing his badge around. He's more actively involved in
Speaker 15: the operations of the company than he has been really
Speaker 15: since twenty nineteen when he stepped down as chairman. In particular,
Speaker 15: he's been quite involved in AI, their AI initiatives, which
Speaker 15: are going quite well at Ali Baba, and he's been
Speaker 15: very involved in this e commerce fight that the company
Speaker 15: has been having with JD dot Com and Mayitwan, the
Speaker 15: biggest delivery company there. Jack is used to the days
Speaker 15: when Ali Baba commanded the tech landscape within China, when
Speaker 15: they had something like eighty five percent of the e
Speaker 15: commerce market, and now the competition is much more severe.
Speaker 15: So in this latest clash where these companies are really
Speaker 15: fighting with each other over fast deliveries, deliveries within an hour,
Speaker 15: he's been encouraging them to spend lots of money fifty
Speaker 15: billion New Want or about seven billion dollars on these
Speaker 15: fast delivery competitions. So he's there, he's involved in strategy,
Speaker 15: he's taking part in these discussions, and he's quite active,
Speaker 15: and he's an inspiration for employee.
Speaker 2: He's on campus.
Speaker 3: That was part of the reporting that I found most interesting.
Speaker 3: Sources basically telling us that Jack is back, but other
Speaker 3: officials at the company are trying to explain to him
Speaker 3: that it's not the Ali Barba that he knew from
Speaker 3: a market competitiveness standpoint. Do we know anything about how
Speaker 3: Jack Mars reacted to that, you know, the new realities
Speaker 3: that he finds himself in.
Speaker 2: Right.
Speaker 15: He certainly is used to the days when Ali Baba
Speaker 15: was the biggest, most valuable tech company within China, and
Speaker 15: now the landscape has changed quite a bit. Even in
Speaker 15: e commerce, they face very very serious competition and food
Speaker 15: delivery May Twine is much bigger than they are now
Speaker 15: ten Cent is much more valuable than they are. Ali
Speaker 15: Baba's stock has come back quite a bit this year.
Speaker 15: It's up about eighty percent, but it's still far far
Speaker 15: below its peak back in twenty twenty. It's down more
Speaker 15: than fifty percent from that level, and for good reason.
Speaker 15: The company ran into a bunch of regulatory problems. Jack
Speaker 15: Moss spoke out against the regulators at the time. That
Speaker 15: was part of the reason that the company ran into trouble.
Speaker 15: They were planning on taking their finance affiliate and group
Speaker 15: public at that point, and they had to pull that IPO.
Speaker 15: It still isn't public even at this point. But now
Speaker 15: he's sort of come back. He's revived his reputation and
Speaker 15: met with Shi Jimping earlier this year, So now he's
Speaker 15: given more freedom and he's participating in campus and he's
Speaker 15: more than just another executive at the company. He really
Speaker 15: is an inspiration for a lot of the employees. Many
Speaker 15: of these employees never worked with him, and they've been
Speaker 15: there a short enough period of time that they haven't
Speaker 15: really seen what he's been able to do, and they're
Speaker 15: looking forward to him coming back. But as you say,
Speaker 15: the business is very different. AI is much more important.
Speaker 15: E commerce is very much a different game. They're participating
Speaker 15: in cloud computing, so there's a lot that he has
Speaker 15: to learn too.
Speaker 3: Bloomberg's Peter Elstrom on a really important piece of Bloomberg
Speaker 3: reporting about Ali Baba, Thank you Now. AI is coming
Speaker 3: for the Owl due lingo is facing risks from multiple angles.
Speaker 3: Is investors reassess the impact of AI on the language
Speaker 3: learning platform. One of them AI powered live translation services.
Speaker 3: Bloomberg's Tech equity reporter for Ian Vaselka has the reporting,
Speaker 3: this takes me back to Apple iPhone day in the
Speaker 3: market move when Airport's pro had simultaneous translation.
Speaker 2: You've looked at the stock, what's going on? Hey, thanks
Speaker 2: for having me.
Speaker 13: So we've seen a number of AI companies and services
Speaker 13: come out with live translation features, which is seen as
Speaker 13: a kind of competition for dual lingo. Are people going
Speaker 13: to be paying to keep learning languages. When you can
Speaker 13: have AI automatically translate everything for you right away, that's
Speaker 13: a big concern. Now the company has its own AI
Speaker 13: first strategy, but this is an example where we have
Speaker 13: seen a real consumer backlash against this. Now the company
Speaker 13: says it's not impacting their financials yet, but we've seen
Speaker 13: some analysts come out and talk about how this sort
Speaker 13: of consumer aversion to AI could ultimately lead to weaker
Speaker 13: user growth or other kinds of financial churn. So this
Speaker 13: is a company that is getting it kind of on
Speaker 13: both sides, both a backlash and competition from AI.
Speaker 4: In our household, it's all about chess, bloemegs round Ustelica,
Speaker 4: thank you very much.
Speaker 5: Indeed, YouTube's Made on YouTube event is Underwear in New York,
Speaker 5: with the.
Speaker 4: Company unveiling new tools, of course, including plenty of aipowd
Speaker 4: ones to help video creators. We've got one of them,
Speaker 4: one of the most successful ones, Mark Rover, former NASA
Speaker 4: engineer turned hugely popular YouTuber. And you are one of
Speaker 4: the key creators at the event. You are in an
Speaker 4: Apple product design as well. But you flipped your attention
Speaker 4: back in twenty eleven to basically virality on YouTube and
Speaker 4: education around science in particular, how much are you adopting
Speaker 4: the AI tools, how much your team adopting it and
Speaker 4: making your life a lot easier.
Speaker 14: We've definitely got our pulse on it. We're using it
Speaker 14: a lot for like ideation and like thumbnails. I'd say
Speaker 14: is like the main like ide eating what thumbnails are.
Speaker 14: But it's like, it will be really interesting to see
Speaker 14: how consumers feel about this, right because some people do
Speaker 14: feel like it's taking you know, the creator out of
Speaker 14: the loop. But I think YouTube has been very clear
Speaker 14: today they want to creator in the loop is what matter.
Speaker 14: They don't want aislop either, So it kind of remains
Speaker 14: if you've seen how the consumer feels out about it.
Speaker 4: Interesting because for you, it's maybe about ab testing titles basically,
Speaker 4: maybe there's dubbing that really helps the reach when you
Speaker 4: go more global mark But when you think of VO
Speaker 4: three and the use just not even of view as
Speaker 4: a person, what do you want to put in place
Speaker 4: by YouTube to ensure that slop isn't created?
Speaker 7: I think I just trust that they're going to do
Speaker 7: this responsibly.
Speaker 14: But even for me, like there's an opportunity here, right,
Speaker 14: Like I want to get people stoked about science and education,
Speaker 14: and there's only you know, twenty four hours in a day,
Speaker 14: so even for me, there's you know, there's an opportunity
Speaker 14: for me to scale myself and to you know, teach
Speaker 14: more topics deeper.
Speaker 7: So you know, we're keeping a pulse on it.
Speaker 14: I think YouTube will do a very good job of
Speaker 14: making sure it's it's high quality and it's additive and
Speaker 14: your feed isn't just filled with slot. That's terrible business
Speaker 14: for them, right, They don't want that to happen. People
Speaker 14: would stop using the platform.
Speaker 9: Mark.
Speaker 3: I spent a bit of time watching the Team Water
Speaker 3: video that you did the collab we missed the Beast right,
Speaker 3: and you know, hearing from some of the execs at
Speaker 3: today's event, there's lots of awesome AI stuff with VO three,
Speaker 3: but you describe how you'd use it. The Team Water
Speaker 3: projects like real video. Does it result the AI tool
Speaker 3: in just less real material circulating on the platform?
Speaker 14: I think it depends on the type of content, right,
Speaker 14: for like just telling stories and like fiction. You know,
Speaker 14: I think you're gonna see a lot more AI adoption
Speaker 14: and people being okay with that. You know, at the
Speaker 14: end of the day, if you know, mister bist and
Speaker 14: I we go to Kenya to visit a village. If
Speaker 14: that's AI, like, I got to imagine people aren't going
Speaker 14: to love that, right, So there's definitely going to be
Speaker 14: a spot for like real content that is actual connecting
Speaker 14: with real humans, right. And then there's a spot where
Speaker 14: I think it's going to really help with storytelling, and
Speaker 14: so I think I think we'll see how that kind
Speaker 14: of settled out settles out over time.
Speaker 3: Mark, what are the main challenges that you face on
Speaker 3: YouTube that were not addressed by by these great generative
Speaker 3: AI tools that will put out today?
Speaker 14: I mean, for the challenges that I face, I feel
Speaker 14: like it's actually they've given me more tools than I
Speaker 14: would even use out of the gate, right, So I
Speaker 14: think they're doing a good job of getting out in
Speaker 14: front of it and giving creators the tools.
Speaker 7: And that's what YouTube.
Speaker 14: Does, right, That's kind of their advantage over like a Netflix.
Speaker 14: They don't have to pick the winners. They make the tools,
Speaker 14: they create the platform and lo and behold over time,
Speaker 14: the winners, you know, emerge, and then that's.
Speaker 7: Who YouTube pays right through addsets and stuff.
Speaker 14: So I think they're just following the same playbook that
Speaker 14: they've done so far that's made them so successful. Create
Speaker 14: the tools, create the platform. The end of the day,
Speaker 14: it's all about the creators.
Speaker 5: And it's about authentic creators.
Speaker 4: And that's what helped, for example, crunch Labs with the
Speaker 4: success of getting real products into real people's hands because
Speaker 4: people trust you and therefore you can help sell products.
Speaker 5: You can do the stem toys, you can think.
Speaker 4: Not only about viral videos, but about curriculum, about content,
Speaker 4: about media projects that you're thinking mark will in the end,
Speaker 4: authenticity be the thing that lends you even more success
Speaker 4: versus the sudden wall of creation that we're going to
Speaker 4: see that isn't real.
Speaker 14: Yeah, I mean, especially on YouTube, historically, authenticity is the currency.
Speaker 14: And that's kind of like what's helped me in by
Speaker 14: background at NASA and Apple. I'm an actual mechanical engineer.
Speaker 14: And you know, if a TV show like Discovery Channel
Speaker 14: puts a TV show on YouTube, it doesn't do very
Speaker 14: well because people want that authentic connection. So I think
Speaker 14: there's probably going to be ways though, to even using
Speaker 14: AI create that connection with your audience that feels authentic
Speaker 14: and it all remained. You know, we're going to see
Speaker 14: how that kind of pans out. But the tool is
Speaker 14: just so powerful. You can do so much with it.
Speaker 14: You know, clearly there's going to be some fairly seismic shift.
Speaker 14: The key is kind of observing it and kind of
Speaker 14: staying out in front, using it as a tool to
Speaker 14: further authentically, you know, connect with your audience.
Speaker 4: Marve your story is so fascinating. The fact that, yeah,
Speaker 4: you've done all this philanthropic work of late and we
Speaker 4: saw that with mister Beeste, But the fact that you
Speaker 4: were an.
Speaker 5: Assa engineer, the fact that you were working at Apple.
Speaker 4: I mean we're all talking about generals to AI and
Speaker 4: Apple being behind the curve. What do your products you
Speaker 4: want from them?
Speaker 7: Yeah?
Speaker 14: I would want an iPhone that you know, actually Siri
Speaker 14: that can actually answer a question or dictate.
Speaker 7: Well, you know that Google.
Speaker 14: It's really funny actually, you know it used to be
Speaker 14: the Apple events are exciting. Google's were kind of boring
Speaker 14: with like hardware and phones, and now it's sort of
Speaker 14: switch where it's like, oh, what's Google doing, because you
Speaker 14: know they are, you know, head of the curve at
Speaker 14: least with AI and Gemini versus Apple got some catching
Speaker 14: up to do. So regardless, it's a very exciting time
Speaker 14: to be alive, right, you know, I think the way
Speaker 14: we can definitely agree is that things will be changing
Speaker 14: a lot in the next three, five, ten years and
Speaker 14: we just get to you know, sit by an a watch.
Speaker 14: But there's others of us, you know, myself, even you
Speaker 14: know you guys included. We get to be part of
Speaker 14: like shaping what it will be and how it will
Speaker 14: turn out.
Speaker 2: Market.
Speaker 3: It looks like TikTok in the United States will be
Speaker 3: able to continue. We'll find out more this week. You know,
Speaker 3: in your career as a content creator focus on YouTube.
Speaker 3: How do you view that? You know, your industry faces
Speaker 3: choice right on the platforms that they can go to.
Speaker 7: I think it's great. I think competition's great.
Speaker 14: Honestly, I will say most creators, if you actually ask them,
Speaker 14: want to move to YouTube, Like if you're big on TikTok,
Speaker 14: if you're big on Instagram, like, they want to shift
Speaker 14: to YouTube because they watch out for creators most they
Speaker 14: pay the most. I'm not getting paid to say that.
Speaker 14: I'm just one of them, and I see this right,
Speaker 14: So and generally, you know, when TikTok had their short
Speaker 14: form now YouTube as YouTube shorts. So generally, if there's
Speaker 14: a type of content that really becomes sticky, right. You know,
Speaker 14: YouTube adapts, and you know this AI is a great
Speaker 14: example of this, Right. I think they're staying ahead of
Speaker 14: the curve and skating to where the puck is and
Speaker 14: saying like, hey, we need to make these tools available
Speaker 14: so that we don't become obsolete, which, honestly, you know,
Speaker 14: YouTube is where I have seventy one million subscribers.
Speaker 7: So I'm really glad that they are having that kind.
Speaker 14: Of attitude so that it doesn't become a tool or
Speaker 14: in a platform that people don't want to use.
Speaker 2: Right.
Speaker 3: Mark Rover, YouTube Create, a founder of crunch Labs. Really
Speaker 3: great to have you here on Bloomberg Tech. Thank you
Speaker 3: very much. That does it for this edition of Bloomberg
Speaker 3: Tech CARC.
Speaker 4: Do not forget to check out some of our other
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Speaker 5: iHeart from New York from San Francisco. This is bet
Speaker 5: back Tack.
Speaker 11: Yeah,