WEBVTT - Microsoft's Chips and Starlink's 2024 IPO 0:00:01.400 --> 0:00:05.080 From Marhart where Innovation of Money and Power Collie in 0:00:05.200 --> 0:00:10.080 Silicon Valley, NBN. This is Bloomberg Technology with Caroline Hyde 0:00:10.160 --> 0:00:24.160 and Ed Ludlow. 0:00:25.680 --> 0:00:28.680 I'm Caroline Heindel Bloomberg's world headquarters in New York and 0:00:28.720 --> 0:00:30.600 I met Ludlow in San Francisco. 0:00:30.760 --> 0:00:32.919 This is Bloomberg Technology coming. 0:00:32.760 --> 0:00:36.320 Up Microsoft, it unveils its first custom designed AI and 0:00:36.400 --> 0:00:39.080 cloud chips. Will discuss what the move means for the 0:00:39.120 --> 0:00:40.200 company and its. 0:00:40.080 --> 0:00:44.320 Competitors, and SpaceX planning to spin off its Starlink unit 0:00:44.360 --> 0:00:46.960 for a public listing as soon as late twenty four. 0:00:47.040 --> 0:00:49.480 Will bring you the details from our scoop as Elon 0:00:49.600 --> 0:00:51.720 Musk denies the reporting. 0:00:51.640 --> 0:00:53.600 And we'll break down what do you expect from the 0:00:53.640 --> 0:00:57.400 meeting between President Biden and she in San Francisco, as 0:00:57.480 --> 0:01:00.520 well as what it means for tech's cities future. But 0:01:00.640 --> 0:01:03.080 let's have a quick check in on these markets, because 0:01:03.320 --> 0:01:05.800 we're just calming down after a rampant rally that we've 0:01:05.800 --> 0:01:07.840 seen in the world of stocks, but still holding onto gains. 0:01:07.880 --> 0:01:09.320 On the nawdslack we're up a tenth of a percent 0:01:09.520 --> 0:01:12.200 tense that's called it, and in notable we're seeing gains 0:01:12.240 --> 0:01:14.320 over in China, whether or not we're seeing the fuel 0:01:14.560 --> 0:01:17.160 feed over from the US into China, but also some 0:01:17.200 --> 0:01:19.280 of the economic data coming in strong when it comes 0:01:19.319 --> 0:01:21.560 to retail, when it comes to the consumer there and 0:01:21.680 --> 0:01:24.640 notably around some of the companies have been reporting their earnings. 0:01:24.720 --> 0:01:26.600 Of course, we see ten Cent beat, we see JD 0:01:26.680 --> 0:01:29.039 de Coom beat in terms of their earnings, and therefore 0:01:29.040 --> 0:01:30.800 we push ahead to what's happening with Ali Baba so 0:01:30.880 --> 0:01:32.480 green on the screen in China. We're looking at the 0:01:32.480 --> 0:01:35.000 ten year yield just managing to rise up quite a 0:01:35.040 --> 0:01:37.560 lot today though remember after we've seen really yields come 0:01:37.680 --> 0:01:40.720 crashing down as many anticipate that the Federal Reserve is 0:01:40.720 --> 0:01:42.920 done with its hiking cycle, an indeed many a central 0:01:42.920 --> 0:01:45.280 bank around the world move Honestly, what's happening in terms 0:01:45.280 --> 0:01:46.920 of the world a bitcoin actually, for once, we're getting 0:01:46.920 --> 0:01:49.400 a bit of a bid. Having yesterday been relatively calm, 0:01:49.440 --> 0:01:51.360 We're at thirty six three hundred and eighty three. We're 0:01:51.400 --> 0:01:53.320 up more than two point two on the day. 0:01:53.440 --> 0:01:53.480 Ed. 0:01:53.520 --> 0:01:54.160 What have you've got in the. 0:01:54.080 --> 0:01:56.880 Micro Yeah, the story that's broken in the last hour 0:01:57.080 --> 0:02:00.200 is Microsoft unveiling its first kind of custom sill and 0:02:00.280 --> 0:02:04.160 it's two chips. In fact, Maya is the AI accelerator 0:02:04.200 --> 0:02:07.280 for both training and inference, and then you have Cobalt, 0:02:07.280 --> 0:02:09.880 which sees Microsoft moved into kind of the more generic 0:02:10.320 --> 0:02:14.560 server design chip space. It's interesting who it's impacted that 0:02:14.600 --> 0:02:16.480 the news didn't really move the needle. For Microsoft, We're 0:02:16.520 --> 0:02:18.800 softer three tenths of one percent. I would say that 0:02:18.880 --> 0:02:22.160 in the last thirty minutes or so, declines on Innvidia 0:02:22.480 --> 0:02:24.400 have accelerated. We're going to look a bit closer to 0:02:24.520 --> 0:02:26.360 VideA in just a second. But I would point out 0:02:26.400 --> 0:02:29.600 that Maya the AI accelerator, it's kind of looking at 0:02:29.600 --> 0:02:31.040 the specs not the same. 0:02:30.840 --> 0:02:32.040 As your H one hundred. 0:02:32.360 --> 0:02:35.079 It's more general use on both the training and inference 0:02:35.120 --> 0:02:37.840 side rather than that kind of high spec H one hundred. 0:02:37.880 --> 0:02:40.360 But it's interesting to see the market play out the 0:02:40.360 --> 0:02:43.600 fact that Invidia is down this Wednesday's session. Well, I'm 0:02:43.720 --> 0:02:47.200 very sorry to say, Caroline, that the record equalling streak 0:02:47.240 --> 0:02:49.880 for Nvidia is over as it stands. If we close 0:02:49.919 --> 0:02:52.960 in the red, Nvidia snaps those ten straight days of gains, 0:02:52.960 --> 0:02:56.520 which matched its longest streak of winds going back to 0:02:56.560 --> 0:03:00.519 December twenty sixteen, and eleventh day of gains have been 0:03:01.320 --> 0:03:03.840 a new record for video. So much momentum though about 0:03:03.840 --> 0:03:05.760 what they're doing in new chips for China, the H 0:03:05.800 --> 0:03:07.560 one hundred is still pretty much the only game in 0:03:07.600 --> 0:03:11.280 town when you're training those foundation models with billions and 0:03:11.280 --> 0:03:14.639 billions of parameters. But what does this Microsoft mean news mean? 0:03:14.960 --> 0:03:17.680 For kind of more general AI, Let's bring in Richie Juluria, 0:03:17.760 --> 0:03:21.960 Managing director and software exit research analysts at RBC Capital Markets, 0:03:21.960 --> 0:03:25.679 currently has an outperformed rating on shares of Microsoft a 0:03:25.720 --> 0:03:28.600 three hundred and ninety dollars price target. Richie, you kind 0:03:28.600 --> 0:03:31.040 of heard my explanation and my reaction to both. 0:03:30.880 --> 0:03:32.880 Myra and Cobolt. What is yours? 0:03:33.880 --> 0:03:36.160 Yeah? And then thanks so much for having me really 0:03:36.200 --> 0:03:36.760 appreciate it. 0:03:37.000 --> 0:03:39.040 I'm actually here in New York at our RISI's low 0:03:39.160 --> 0:03:42.680 tech confer concreates and as he can imagine Generator VII 0:03:42.760 --> 0:03:45.280 front and center and all our conversations and look, one 0:03:45.280 --> 0:03:46.800 of the themes that we hear from a lot of 0:03:46.840 --> 0:03:51.680 companies is it is prohibibly expensive to do generative right, 0:03:51.760 --> 0:03:54.720 not just the training, but the inferencing, trying to add 0:03:54.720 --> 0:03:58.000 domain extra keys connecting all these different systems and so 0:03:58.080 --> 0:04:00.920 what I think Microsoft brings here is they can help 0:04:01.480 --> 0:04:05.760 themselves and other companies overcome this big GPU sort this 0:04:05.880 --> 0:04:08.480 out there. As you said, respects aren't quite the same 0:04:08.560 --> 0:04:10.640 exactly as an A one hundred. But I think what's 0:04:10.720 --> 0:04:13.840 what's interesting is you don't necessarily need only eight hundreds 0:04:13.840 --> 0:04:16.360 to do all your training, especially if you're thinking about 0:04:16.560 --> 0:04:19.200 you know, more domain specific models or trying to do 0:04:19.279 --> 0:04:22.040 some you know, additional tooling on top of TPT for 0:04:22.680 --> 0:04:25.960 or LAMA too, and so this creates I think, more 0:04:26.000 --> 0:04:30.800 accessibility for large language models, for you know, software companies, 0:04:30.839 --> 0:04:34.040 for industry companies to enbridge generate b I without seeing 0:04:34.040 --> 0:04:35.200 a huge cost drag. 0:04:35.839 --> 0:04:37.600 So I'm really excited to see this news. 0:04:37.600 --> 0:04:40.200 This is something that we suspected for a long time, 0:04:40.560 --> 0:04:42.880 but I think it is ultimately going to make ANYI more. 0:04:42.800 --> 0:04:46.560 Accessible TSMC, I think making the chips sort of behind 0:04:46.640 --> 0:04:49.320 from a technology perspective. But I'm interested in rich as 0:04:49.360 --> 0:04:52.159 to what this does mean for competitors. Amazon has already 0:04:52.160 --> 0:04:55.040 been doing this, Alphabet's Google has already been doing this 0:04:55.120 --> 0:04:57.960 with their cloud provisions. Does it who does it impact? 0:04:58.000 --> 0:04:59.960 It feels like maybe Intel's the one to be watching. 0:05:00.120 --> 0:05:04.200 Yeah, Look, I think it impacts everyone, right, I think, 0:05:04.520 --> 0:05:06.160 you know, we're gonna have to see how this specs 0:05:06.160 --> 0:05:11.120 between a WUSS chips and GCPS chips and Microsoft chip compare. 0:05:11.279 --> 0:05:14.680 But Microsoft has already this kind of pole position as 0:05:14.720 --> 0:05:18.239 being the leader when it comes to enterprise generative AI, 0:05:18.760 --> 0:05:21.240 and I think there's only bolts that that companies now 0:05:21.320 --> 0:05:23.640 that they can go to Microsoft and they may not 0:05:23.720 --> 0:05:25.719 need to go to someone like Oracle that has excess 0:05:25.760 --> 0:05:29.240 GPU capacity. They can stick with Microsoft because now Microsoft 0:05:29.320 --> 0:05:32.000 has the capacity, given they's some of the ability to 0:05:32.040 --> 0:05:34.760 develop this in house. So this is probably I think 0:05:34.800 --> 0:05:38.240 positive for Microsoft. Probably it's going to be you know, 0:05:38.520 --> 0:05:41.400 as you said, there are absolute direct complications for Intel, 0:05:41.880 --> 0:05:45.800 for AMD, for others within the chip space, But overall, 0:05:45.880 --> 0:05:46.400 I think. 0:05:46.279 --> 0:05:48.680 This is just going to be positive for Microsoft and OI. 0:05:49.720 --> 0:05:51.800 It's so interesting to see what some of these names 0:05:51.800 --> 0:05:54.239 and trading right now. Intel's up two percent in the session. 0:05:54.320 --> 0:05:57.800 Krror makes such a good point that this battle ground 0:05:57.880 --> 0:06:01.080 seems like the lower end of the ex elerate A market. 0:06:01.320 --> 0:06:04.080 I'm looking specifically at Microsoft though, right, Richie, That's why 0:06:04.120 --> 0:06:06.320 we're here. It's down two tents of what at percent 0:06:06.480 --> 0:06:10.360 is kind of like a muted reaction. Does that signal 0:06:10.400 --> 0:06:13.800 that this just isn't a game changer for Microsoft's cloud business, Like, 0:06:13.839 --> 0:06:16.640 why is there not a more significant reaction in the 0:06:16.680 --> 0:06:17.320 stock heare. 0:06:18.720 --> 0:06:22.000 Yeah, look, I think people are the jury is still 0:06:22.040 --> 0:06:24.559 out right. As you correctly pointed out, these specs aren't 0:06:24.560 --> 0:06:27.720 exactly up to the top of the line GPUs from Nvideo, 0:06:28.120 --> 0:06:31.480 and you know, given Microsoft's pace of innovation, perhaps investors 0:06:31.520 --> 0:06:34.840 we were expecting something like that. I think Microsoft will 0:06:34.880 --> 0:06:36.599 eventually get there. I think they've shown they have the 0:06:36.640 --> 0:06:39.720 ability to innovate and move very quickly, and that might 0:06:39.720 --> 0:06:40.400 explain why. 0:06:40.240 --> 0:06:41.720 There's maybe a little bit of media reaction. 0:06:41.800 --> 0:06:44.120 I'll also say, beyond the chips, some of the product 0:06:44.120 --> 0:06:46.880 announcements we've seen so far out of Big Night may 0:06:46.880 --> 0:06:49.440 not be as exciting as people were hoping to see. 0:06:49.640 --> 0:06:51.520 I think on in my view. 0:06:51.640 --> 0:06:54.159 There's a lot of exciting stuff that we're already seeing. 0:06:54.160 --> 0:06:57.200 And you know, obviously this keynote is about to kick off. 0:06:57.240 --> 0:06:57.880 I think we're going to. 0:06:57.800 --> 0:06:58.640 See a lot more. 0:06:58.880 --> 0:07:00.920 So I wouldn't be surprised as as the conference and 0:07:01.000 --> 0:07:03.960 the date goes on, Microsoft stock actually moves up, assuming 0:07:04.000 --> 0:07:06.400 that they continue to make you know, I think announced 0:07:06.400 --> 0:07:09.200 with that excite people. Gives some stats around M three 0:07:09.240 --> 0:07:12.400 sixty five adoption. I really like that they've rebranded being 0:07:12.520 --> 0:07:15.600 Enterprise Chat as Microsoft Copilot. I think that makes it 0:07:15.640 --> 0:07:19.960 a much more digestible, kind of straightforward value proposition, and 0:07:20.000 --> 0:07:22.360 I think this just opens up a lot of innovation 0:07:22.400 --> 0:07:23.320 from Microsoft. 0:07:23.520 --> 0:07:26.480 We see as we do anticipate what Satya is going 0:07:26.560 --> 0:07:29.440 to say on stage, it is interesting that it looks 0:07:29.480 --> 0:07:32.040 like it's the price that is becoming front and center. 0:07:32.080 --> 0:07:35.640 Now we have that with open Ayes Developers Day as well. 0:07:35.680 --> 0:07:37.120 It all seemed to be suddenly a bit of a 0:07:37.200 --> 0:07:42.680 race to offer more and accessibility and GPTs and chats. 0:07:42.720 --> 0:07:46.240 As we're seeing more more assistance, but with a cheaper 0:07:46.240 --> 0:07:48.600 price point, a new lower price for clients. For example 0:07:48.640 --> 0:07:51.200 of Microsoft three six y five copilot product for the 0:07:51.200 --> 0:07:54.280 office software and the sales copilot. Is it going to 0:07:54.280 --> 0:07:55.520 be a bit of a rush down? Onds do you 0:07:55.560 --> 0:07:56.920 think in the price point of all of these. 0:07:58.560 --> 0:07:59.560 I actually don't think so. 0:08:00.080 --> 0:08:01.840 In fact, I would argue, I mean, going to open 0:08:01.880 --> 0:08:04.960 Ai twenty dollars a month is actually too cheap for 0:08:05.040 --> 0:08:07.640 what you're getting out of chatting PG four Assuming you're 0:08:07.640 --> 0:08:09.880 a power user, which I would consider myself to be 0:08:09.920 --> 0:08:12.840 one of those. For Microsoft Copilot, the name of the 0:08:12.880 --> 0:08:16.480 game here is not about lowering the price. It's about 0:08:16.520 --> 0:08:19.640 adding new features and adding new capabilities. And so now 0:08:19.720 --> 0:08:22.120 you know, with the announcements today what you used to 0:08:22.200 --> 0:08:24.480 call being at a price chat now is Microsoft Copilot 0:08:24.600 --> 0:08:26.680 is part of that thirty dollars per user per month 0:08:26.960 --> 0:08:28.880 that was in the M through sixty five steed that 0:08:29.040 --> 0:08:33.120 got released earlier this month. You also have connectivity of 0:08:33.480 --> 0:08:36.319 ent through sixty five Copilot too, systems of record like 0:08:36.440 --> 0:08:39.280 service now on workday and so to me, as long 0:08:39.280 --> 0:08:43.080 as Microsoft continues to grow what is included in that 0:08:43.320 --> 0:08:45.640 s few in that thirty dollars per user per month, 0:08:46.080 --> 0:08:48.040 I think people are going to be able to justify 0:08:48.080 --> 0:08:51.120 that price pretty easily. And look, look no further than 0:08:51.160 --> 0:08:54.160 getthub Copilot. Get up Copilt has been a you know, 0:08:54.679 --> 0:08:57.320 the most mature enter a product for Microsoft. 0:08:57.640 --> 0:08:59.640 It's been you know, I think a slam dunk in chef. 0:08:59.640 --> 0:09:02.160 You look at the metrics in terms of developing productivity, 0:09:02.480 --> 0:09:05.520 new code generation, and I wouldn't be surprised if we 0:09:05.559 --> 0:09:07.120 start to see the same out of M through six 0:09:07.160 --> 0:09:09.880 SOL code Pilot as it continue to innovate, you know, 0:09:09.960 --> 0:09:12.559 maybe you know, for an Excel junkie like me, we'll 0:09:12.559 --> 0:09:15.760 get an Excel copilot that makes my life of building 0:09:15.840 --> 0:09:18.959 financial models and doing data analysis a lot easier over 0:09:19.000 --> 0:09:20.480 the next year. So really the name of the game 0:09:20.600 --> 0:09:22.960 is going to be innovation and adding more features, not 0:09:23.080 --> 0:09:23.720 lowering price. 0:09:24.520 --> 0:09:26.320 Okay, I just want to jump in and point out 0:09:26.480 --> 0:09:29.680 that the open ai is going to be testing the 0:09:29.720 --> 0:09:31.960 Azure and Maya one hundred, and the relationship is so 0:09:32.000 --> 0:09:35.440 interesting because open ai relies on Microsoft not just for 0:09:35.520 --> 0:09:39.280 cash but compute credits. They also like rely on Nvidia 0:09:39.480 --> 0:09:41.839 the badge of honor of the h one hundred. It's complicated, 0:09:42.160 --> 0:09:43.800 but it's going to be interesting to see in the 0:09:43.960 --> 0:09:46.280 end who's going to win the computing ward just wanted 0:09:46.280 --> 0:09:46.920 to say, yeah. 0:09:46.800 --> 0:09:48.839 A lot of friends or a frenemies, and a lot 0:09:48.840 --> 0:09:50.840 of deal making. I mean, we heard earlier this week 0:09:50.880 --> 0:09:54.440 that someone when I'm still banking on Microsoft, perhaps injecting 0:09:54.440 --> 0:09:55.280 more money as it. 0:09:55.240 --> 0:09:56.320 Goes forwards and grows. 0:09:56.600 --> 0:09:58.560 Richie, Julia, it's so great. We'll let you get back 0:09:58.559 --> 0:10:01.720 to the conference go into all the conversations around untender 0:10:01.760 --> 0:10:09.880 to AI. We thank you for the LBC Capital Markets. 0:10:11.280 --> 0:10:15.200 China's President Hijingping has touchdown in San Francisco for APEX, 0:10:15.520 --> 0:10:17.920 where he's expected to sit down with the US President 0:10:18.000 --> 0:10:21.120 Joe Biden. Today. Joining us now is Blomberg's Amory Holden, 0:10:21.160 --> 0:10:23.360 and it was three pm local time that we saw 0:10:23.400 --> 0:10:26.440 these pictures of him exiting his plane. Of course, Treasury 0:10:26.480 --> 0:10:30.160 Secretary Ellen there to help greet as well as Gavin Newsom. Amri. 0:10:30.400 --> 0:10:32.200 There is a whole lot widing on this, and a 0:10:32.200 --> 0:10:34.640 whole lot of protection as well going on. Yeah, there's 0:10:34.679 --> 0:10:35.439 a lot of protection. 0:10:35.520 --> 0:10:37.280 I can tell you that it took a while actually 0:10:37.280 --> 0:10:39.000 to get to where I'm standing right now. A ton 0:10:39.040 --> 0:10:41.120 of security in San Francisco, and Ed can attest to 0:10:41.160 --> 0:10:43.360 that as well. But this is a high stakes meeting 0:10:43.360 --> 0:10:46.640 and it's actually happening outside of San Francisco proper, at 0:10:46.679 --> 0:10:49.680 an estate a little bit more relaxed feel, has sixteen 0:10:49.679 --> 0:10:52.199 acres of gardens. It kind of is reminiscent of when 0:10:52.280 --> 0:10:55.880 Xi Jinping came during the Obama administration and they met 0:10:55.880 --> 0:10:59.840 in Palm Springs and really lived physically. They were rolling 0:10:59.840 --> 0:11:02.320 off their sleeves to get to work. So for the 0:11:02.320 --> 0:11:05.520 Biden administration, we heard from President Biden before he departed 0:11:05.559 --> 0:11:07.960 the White House to San Francisco yesterday, talking about the 0:11:07.960 --> 0:11:10.680 fact that he just wants to get relationships to a 0:11:10.760 --> 0:11:12.959 normal correspondence, to be able to pick up the phone 0:11:13.040 --> 0:11:15.439 during times of conflict, to make sure that their militaries 0:11:15.480 --> 0:11:19.720 go back to normal communication, a normal dialogue, a normal 0:11:19.760 --> 0:11:22.559 cadence of that dialogue that we saw really just ripped 0:11:22.600 --> 0:11:27.400 apart following former Speaker Nancy Pelosi's visit to Taiwan last summer. 0:11:27.440 --> 0:11:31.920 And for Shijingpeng, he's obviously dealing domestically with an economy 0:11:31.960 --> 0:11:35.120 that hasn't bounced back as some were hoping following the pandemic, 0:11:35.120 --> 0:11:38.720 a property market that is dismal at the moment, and 0:11:38.800 --> 0:11:41.240 a very high youth unemployment rate this summer is at 0:11:41.280 --> 0:11:44.520 twenty percent now was the last time we saw the data. 0:11:44.559 --> 0:11:46.959 So for Shijingping, this is a moment of potentially trying. 0:11:46.760 --> 0:11:49.280 To open up some more goodwill on the economic front, 0:11:49.559 --> 0:11:51.600 not just with President Biden, but also this evening when 0:11:51.600 --> 0:11:54.320 he meets with chief executive officers, right. 0:11:54.360 --> 0:11:56.760 I mean, we've heard from sources that you know, the 0:11:56.800 --> 0:11:58.960 who's who of tech execs are trying to get into 0:11:59.000 --> 0:12:02.840 that dinner. The aim is to thaw relationships, particularly on 0:12:02.880 --> 0:12:06.680 the economic side, right, amh. But the battleground here is 0:12:06.679 --> 0:12:10.480 that the US has these technology export curves on China 0:12:10.520 --> 0:12:12.679 in the context of AI and chips. Is that going 0:12:12.720 --> 0:12:14.400 to be a factor here, Well, this. 0:12:14.400 --> 0:12:16.800 Is something that Shijingping would love to get rid of. 0:12:16.880 --> 0:12:19.480 But we already heard from the Treasury Secretary Janet Yellen, 0:12:19.559 --> 0:12:22.280 and we heard from President Biden himself, and Biden Yesterudary 0:12:22.360 --> 0:12:24.960 was saying how it is in the US interest if 0:12:25.000 --> 0:12:27.760 an average Chinese citizen is able to go out and 0:12:27.800 --> 0:12:30.600 have a working wage and make a decent living. But 0:12:30.640 --> 0:12:34.600 Biden was very clear he will not move economically if 0:12:34.679 --> 0:12:38.760 it impedes US national security interest. So those export controls, 0:12:38.920 --> 0:12:42.000 those penalties, those types of sanctions, they're not going anywhere 0:12:42.000 --> 0:12:42.800 anytime soon. 0:12:43.840 --> 0:12:46.080 All right, Bloomberg's Amory Horden will be on the ground 0:12:46.080 --> 0:12:48.240 at APEC all week. We will continue to bring you 0:12:48.559 --> 0:12:51.000 that reporting. Thank you so much. Let's get more and 0:12:51.040 --> 0:12:54.839 bring in doctor Oriana Skyla Mastro, a Center Fellow at 0:12:54.880 --> 0:12:58.920 the Freeman's Folly Institute for International Studies at Stanford University, DODR. 0:12:58.960 --> 0:13:04.600 Mastro also for of Upstart. How China became a great power. 0:13:04.640 --> 0:13:08.680 Welcome to the program, Dr Mastro. You heard a Marie 0:13:08.720 --> 0:13:13.320 set out the discussion points between Biden and g For you, 0:13:13.480 --> 0:13:16.600 what is the most significant point of discussion between those 0:13:16.640 --> 0:13:17.640 two leaders. 0:13:17.840 --> 0:13:19.920 Well, I think both sides are saying the fact that 0:13:19.960 --> 0:13:23.360 they're even meeting to discuss anything is the biggest takeaway. 0:13:23.920 --> 0:13:28.120 We are facing a bunch of issues right now, security, economic, 0:13:28.280 --> 0:13:30.480 that as the two most powerful countries in the world, 0:13:30.520 --> 0:13:32.640 the United States and China, need to be able to 0:13:32.679 --> 0:13:34.400 collaborate and talk about. 0:13:34.120 --> 0:13:35.199 These issues together. 0:13:35.520 --> 0:13:39.120 And if we don't have routine and sustain and predictable 0:13:39.200 --> 0:13:42.960 visits between the two leaders, this becomes increasingly difficult and 0:13:43.000 --> 0:13:45.800 it's hard to sustain anything that they might even agree 0:13:45.840 --> 0:13:48.520 to add this visit. And so really what I'll be 0:13:48.559 --> 0:13:51.360 looking for is not only the types of topics that 0:13:51.360 --> 0:13:53.760 they're going to discuss and what's on the agenda for 0:13:53.840 --> 0:13:56.880 whether or not they actually have any sort of frank exchange. 0:13:57.120 --> 0:14:01.199 I'm interested to dig into really the perfect points around 0:14:01.280 --> 0:14:04.600 your book that's forthcoming, the idea that through they've built 0:14:04.640 --> 0:14:07.000 up China in particular, it's built up this power, whether 0:14:07.040 --> 0:14:09.480 it be militarily, whether it be economically, whether it be 0:14:10.040 --> 0:14:13.400 entrepreneurially in many ways, but you sort of outline how, 0:14:13.480 --> 0:14:17.760 and it's through strategic emulation, through exploitation, through entrepreneurship. And 0:14:17.800 --> 0:14:20.480 I'm interested in from the tech perspective whether all this 0:14:20.640 --> 0:14:22.720 tip for tat that we continue to see, particularly when 0:14:22.720 --> 0:14:25.400 it's limitations to access to chips, for example, just is 0:14:25.480 --> 0:14:28.000 going to be the normal? Would that be your policy recommendation. 0:14:28.400 --> 0:14:30.480 Well, I think the prediction would be that China is 0:14:30.480 --> 0:14:32.960 going to be somewhat entrepreneurial and its approach to this 0:14:33.040 --> 0:14:36.920 tech competition. In many cases, when I talk to investors, 0:14:37.360 --> 0:14:41.680 they often express some frustration with the economic decisions that 0:14:41.800 --> 0:14:44.080 China makes at home. But as I lay out in 0:14:44.120 --> 0:14:46.880 the book, party control is one of the main factors 0:14:46.880 --> 0:14:50.119 that decides for China which strategy they're going to pursue. 0:14:50.280 --> 0:14:52.320 And a lot of times they can't emulate what the. 0:14:52.360 --> 0:14:56.560 United States is doing because it doesn't it's not conducive 0:14:56.600 --> 0:14:59.120 for their domestic political system at home, so they have 0:14:59.160 --> 0:15:02.360 to go another route. Sometimes that route is relatively ineffective, 0:15:02.560 --> 0:15:05.480 like we see with soft power and perhaps the speed 0:15:05.520 --> 0:15:07.960 at which the Renman b is becoming a reserve. 0:15:07.720 --> 0:15:12.440 Currency without loosening capital controls that's going to be difficult 0:15:13.040 --> 0:15:14.160 for China, but. 0:15:14.080 --> 0:15:16.680 I have no doubt that as they face these new challenges, 0:15:16.960 --> 0:15:18.920 they're going to try to think of new ways to 0:15:18.960 --> 0:15:23.120 exploit their own competitive advantages gaps in the international system, 0:15:23.200 --> 0:15:26.800 for example, and standards and other areas that are important 0:15:26.800 --> 0:15:29.120 for technology to still try to get ahead. 0:15:29.600 --> 0:15:33.960 Dodr Mashtro Corporate America, according to our reporting, is doing 0:15:34.040 --> 0:15:36.840 everything it can to get into that room and have 0:15:36.960 --> 0:15:40.120 dinner with President G. You heard us outline earlier in 0:15:40.160 --> 0:15:44.160 the program about the technology export curves in place. Do 0:15:44.200 --> 0:15:47.040 you think that g can have any kind of leverage 0:15:47.040 --> 0:15:50.960 he can use the interest of technology CEOs in meeting 0:15:51.040 --> 0:15:53.720 him to go to Biden and say, look, everyone wants 0:15:53.720 --> 0:15:54.600 to do business here. 0:15:55.040 --> 0:15:58.400 I am highly doubtful that that would work, honestly speaking, 0:15:58.680 --> 0:16:00.880 not only from the US restricted but also from the 0:16:00.960 --> 0:16:05.960 Chinese perspective. With Chijenping, power is more important than prosperity. 0:16:06.360 --> 0:16:08.920 There's many decisions that we have seen him make that 0:16:09.000 --> 0:16:12.240 if economic prosperity with a number one priority, he would 0:16:12.280 --> 0:16:14.680 have done something completely different. I think the COVID zero 0:16:14.760 --> 0:16:18.200 policy is a perfect example of that, and the same 0:16:18.240 --> 0:16:22.200 for the United States national security now Trump's all things. 0:16:22.280 --> 0:16:24.760 The Chinese military has been modernizing at a pace and 0:16:24.800 --> 0:16:28.040 a speed and at a level that it now presents 0:16:28.600 --> 0:16:30.960 a threat to the United States, and so we can 0:16:31.000 --> 0:16:34.320 no longer turn a blind eye to certain technologies that 0:16:34.400 --> 0:16:35.600 can be dual use. 0:16:35.960 --> 0:16:37.080 And so perhaps those. 0:16:36.960 --> 0:16:39.120 Leaders will get into the room and have a very 0:16:39.160 --> 0:16:42.240 pleasant meeting with Chigenping. But I don't think he's going 0:16:42.320 --> 0:16:46.840 to change his approach to technology control at home. That 0:16:46.960 --> 0:16:50.760 is important for his own control over the country, and 0:16:50.800 --> 0:16:55.080 it's not going to convince the United States to put itself. 0:16:54.680 --> 0:16:57.280 At risk for the sake of economic prosperity. 0:16:57.440 --> 0:17:00.240 We have seen such a change in supply chains. It's 0:17:00.280 --> 0:17:03.200 been focused through COVID, whether or not it's been the 0:17:03.320 --> 0:17:06.600 geopolitics at play. Ultimately the corporates that you speak to 0:17:06.640 --> 0:17:08.720 about this, is that just going to be the narrative 0:17:08.760 --> 0:17:10.879 going forward? We are going to see more of a 0:17:10.880 --> 0:17:12.119 bifurcation or not. 0:17:12.400 --> 0:17:14.240 Well, I really hope it doesn't get to that level 0:17:14.320 --> 0:17:17.840 of a complete bifurcation in two different blocks. I was 0:17:17.880 --> 0:17:20.320 in China two weeks ago having a dialogue with the Chinese, 0:17:20.359 --> 0:17:22.280 and they have the often. 0:17:22.119 --> 0:17:24.320 Retort that the United States is trying to contain them. 0:17:24.640 --> 0:17:27.439 You know, US policy and limited export controls is no 0:17:27.560 --> 0:17:30.520 way a containment of China, and I hope we don't 0:17:30.560 --> 0:17:34.359 move in that direction because our economies are quite interdependent. 0:17:34.680 --> 0:17:36.560 But I think what we're seeing is a lot of 0:17:36.800 --> 0:17:40.840 leaders understand that de risking is important, whether it's supply 0:17:40.960 --> 0:17:43.240 chains for the United States so we can continue to. 0:17:43.200 --> 0:17:46.080 Fight wars if we have to, or for leaders that 0:17:46.160 --> 0:17:48.919 might have manufacturing hubs within China. 0:17:49.280 --> 0:17:51.919 It is important to have a plan B because this 0:17:52.040 --> 0:17:54.520 is not the Cold War. The United States and China 0:17:54.720 --> 0:17:57.639 have some conflicting interests, and it's possible. 0:17:57.359 --> 0:17:59.560 That the two sides find themselves at blows. 0:18:00.040 --> 0:18:03.520 Doctor Rianna Skylo Mastro fascinating me. Thank you so much 0:18:03.720 --> 0:18:07.080 of Stanford University, and of course much more. Meanwhile, coming up, 0:18:07.280 --> 0:18:10.480 let's talk a little bit about the private markets. SpaceX 0:18:10.640 --> 0:18:14.000 considering spinning off its Starlink unit to a public company 0:18:14.000 --> 0:18:17.159 as soon as twenty twenty four. Well, guess who's behind that, 0:18:17.240 --> 0:18:19.680 reporting One Ed Ludlow. We'll speak about it in a minute. 0:18:19.720 --> 0:18:22.240 This is Bloomberg Technology. 0:18:35.920 --> 0:18:39.560 Okay, Bloomberg reporting this morning SpaceX is discussing an IPO 0:18:39.680 --> 0:18:42.800 for its Starlink satellite business. As soon as the end 0:18:42.880 --> 0:18:46.560 of next year twenty twenty four, on robust demand. Elon 0:18:46.640 --> 0:18:50.280 Musk responded almost immediately after we published that story in 0:18:50.320 --> 0:18:52.600 response to a user on x, the platform formerly known 0:18:52.600 --> 0:18:53.840 as Twitter, saying false. 0:18:54.240 --> 0:18:54.640 That's all. 0:18:54.680 --> 0:18:57.560 He said, without elaborating. Let's bring in bloombo Ryan Gord, 0:18:57.600 --> 0:19:00.760 who is one of the reporters that report this story 0:19:00.800 --> 0:19:02.840 with me. Right, let's go over the mechanics of what 0:19:02.880 --> 0:19:03.159 we know. 0:19:03.680 --> 0:19:06.159 Yeah, that's right, Ed. Obviously, great to share a byline 0:19:06.200 --> 0:19:09.760 with you. It's the technology. But last night we reported 0:19:09.800 --> 0:19:12.280 that this morning, even though we reported that SpaceX has 0:19:12.280 --> 0:19:17.560 started discussing a potential of public offering for Starlink as 0:19:17.600 --> 0:19:20.920 soon as the end of next year, it has started 0:19:20.920 --> 0:19:25.320 to move the satellites satellite Company's assets into a wholly 0:19:25.359 --> 0:19:27.960