WEBVTT - Adobe Calls off Figma Deal, Apple Halts Watch Sales, AI Deep Dive 0:00:01.520 --> 0:00:06.800 From Marhart where Innovation, Money and Power Collie in Silicon Valley, NBN. 0:00:07.160 --> 0:00:11.200 This is Bloomberg Technology with Caroline Hyde and Ed loved Love. 0:00:24.720 --> 0:00:27.080 I'm Karine Heinde of Bloomberg's World head quarters in New York. 0:00:27.520 --> 0:00:29.840 Then i am at Lovelow in San Francisco. This is 0:00:29.840 --> 0:00:31.560 Bloomberg Technology. 0:00:31.200 --> 0:00:35.320 Adobe Figma, they call off their twenty billion dollar deal 0:00:35.320 --> 0:00:37.320 after clashing with regulators in Europe. 0:00:37.000 --> 0:00:39.800 And the UK. Will bring you everything you need to know. 0:00:40.840 --> 0:00:44.040 Plus a Rod's black Chech company plans a merger with 0:00:44.120 --> 0:00:47.479 satellite Communications provide a link global. We hear from the 0:00:47.520 --> 0:00:50.040 former New York Yankees. All start on the deal and. 0:00:50.000 --> 0:00:51.760 We'll take a deep dive into the world of you 0:00:51.800 --> 0:00:54.800 guessed it, artificial intelligence, from investing in the space, how 0:00:54.840 --> 0:00:58.280 businesses are utilizing the technology, and the ethical concerns attached 0:00:58.280 --> 0:01:00.000 to AI or break it all down. 0:01:00.080 --> 0:01:01.800 Let's first talk to us about these deals. 0:01:02.920 --> 0:01:06.560 Yeah, well, the deal that's dead, Adobe and Figma mutually 0:01:06.600 --> 0:01:10.760 agreeing to terminate Adobe's acquisition of Figma, a twenty billion 0:01:10.800 --> 0:01:14.000 dollar deal. As you said, equity market reaction Adobe up 0:01:14.080 --> 0:01:17.560 one point nine percent. And it's interesting because the question 0:01:17.720 --> 0:01:20.560 is would this have ever pass muster with the regulators. 0:01:20.560 --> 0:01:22.800 We'll get to that in just a second. The news 0:01:22.840 --> 0:01:26.919 being that Adobe pays Figma a one billion dollar termination 0:01:27.120 --> 0:01:31.280 or breakup fee. Now that the deal has failed, lots 0:01:31.280 --> 0:01:33.720 of opinions out there on social media about whether this 0:01:33.920 --> 0:01:36.000 was a good or bad deal. Let's get the details 0:01:36.040 --> 0:01:38.959 and bring in Bloomberg's Brody Ford. I guess this is 0:01:38.959 --> 0:01:41.160 one of those deals and one of those stories, Brody, 0:01:41.240 --> 0:01:45.000 where you start with the why why did both parties 0:01:45.040 --> 0:01:46.800 decide to terminate this agreement? 0:01:47.920 --> 0:01:50.720 Yeah, I mean imagine getting paid one billion dollars to 0:01:50.760 --> 0:01:54.520 break up The reason, the big one is just that 0:01:54.600 --> 0:01:57.600 it was taking so long. Right fifteen months ago, I 0:01:57.640 --> 0:02:00.160 think we sat here and spoke about why Adobe was 0:02:00.200 --> 0:02:02.640 going to buy Pigma, because it wanted to expand its 0:02:02.720 --> 0:02:06.800 kind of creative dominance to look at the app designers, 0:02:06.840 --> 0:02:09.800 the UI designers, and also just invest in a more 0:02:09.880 --> 0:02:14.680 lightweight product. But of course regulators have been very secheptical 0:02:15.000 --> 0:02:18.440 of these deals where a big incumbent tech player will 0:02:18.520 --> 0:02:22.000 kind of scoop up a younger startup that maybe one 0:02:22.040 --> 0:02:25.560 day could threaten it. The sense is that regulators felt 0:02:25.680 --> 0:02:28.840 like they really missed the ball and not stopping Facebook 0:02:28.840 --> 0:02:31.919 from buying WhatsApp or Instagram, and they really wanted to 0:02:32.000 --> 0:02:34.600 kind of make an example here, and so they faced 0:02:34.639 --> 0:02:35.760 severe pushback in. 0:02:35.720 --> 0:02:37.280 The UK EU. 0:02:37.480 --> 0:02:39.960 The US regulators were expected to sue as well, and 0:02:40.040 --> 0:02:42.560 so there was a certain point where both Adobe and 0:02:42.600 --> 0:02:45.800 Figma said, we do not see a way forward here. 0:02:45.800 --> 0:02:47.839 I mean, they could have litigated this for another six 0:02:47.960 --> 0:02:50.440 twelve months and it might have still not worked. 0:02:50.480 --> 0:02:51.880 So they decided to walk away. 0:02:52.160 --> 0:02:55.000 I mean Dylanfield, co founder CEO of Figma, putting out 0:02:55.000 --> 0:02:57.359 a blob today really talking about what was it that 0:02:57.560 --> 0:03:01.000 thousands of hours spent with regulators they still couldn't get 0:03:01.000 --> 0:03:03.280 this deal away. We can see that Adobe's rallying a 0:03:03.320 --> 0:03:05.400 bit on the news, but what is the future of Figma. 0:03:05.480 --> 0:03:07.400 This is a big VC backed company. 0:03:07.440 --> 0:03:09.800 There's a lot of money to be made on this 0:03:09.840 --> 0:03:12.880 particular bet, and I'm interested that they still seem pretty 0:03:12.880 --> 0:03:15.560 positive about what they managed to basically put to market 0:03:15.639 --> 0:03:16.320 during this time. 0:03:17.440 --> 0:03:21.320 Yeah, the big question for US now is are Adobe 0:03:21.320 --> 0:03:23.040 and Figma still on a collision course? 0:03:23.160 --> 0:03:23.359 Right? 0:03:23.480 --> 0:03:26.959 Figma is growing rapidly. For those who are super familiar, 0:03:27.000 --> 0:03:29.960 Figma's really core market is the software that helps you 0:03:30.040 --> 0:03:32.919 design the way that apps and websites look. But they're 0:03:32.960 --> 0:03:36.720 expanding elsewhere. They've looked into more productivity software suite kind 0:03:36.720 --> 0:03:39.360 of think about like a Google workspaces kind of thing. 0:03:39.960 --> 0:03:43.160 They've looked a bit into image editing, right, and so 0:03:43.360 --> 0:03:46.880 you figure that this is a capable company, a capable leadership. 0:03:46.920 --> 0:03:50.320 They've hired five hundred people in the last year. It's 0:03:50.440 --> 0:03:52.760 not hard to imagine a scenario where they grow to 0:03:52.840 --> 0:03:56.080 challenge some of these larger software companies like Adobe. 0:03:56.280 --> 0:03:58.640 It's interesting they talk about the huge advancewers in AI 0:03:59.000 --> 0:04:01.880 as well, and how that is an area of focus 0:04:01.880 --> 0:04:03.880 for the business. I mean, look, we're all waiting for 0:04:04.520 --> 0:04:07.080 IPOs and exits, and this is an exit that's put 0:04:07.080 --> 0:04:08.839 on ice. Do you think this company will be going 0:04:08.840 --> 0:04:10.960 in alone and looking to build in a public market. 0:04:10.680 --> 0:04:13.360 Brody, I think it'll be a while before we see 0:04:13.360 --> 0:04:16.960 an IPO. I think again that Adobe was buying a 0:04:17.080 --> 0:04:21.559 fast growing but somewhat still nascent competitor. I don't remember 0:04:21.560 --> 0:04:24.880 their revenue numbers, but you know they are rapidly growing, 0:04:24.960 --> 0:04:26.880 they're scaling. I think it'd be a while before we 0:04:26.920 --> 0:04:28.880 see an IPO. I mean I've already seen those some 0:04:29.640 --> 0:04:32.359 theories out there, like is fig mug going to merge 0:04:32.360 --> 0:04:34.480 with CANBA? Is fig mug going to get acquired by 0:04:34.480 --> 0:04:36.760 these other large software companies? So I think you're right 0:04:36.880 --> 0:04:39.760 to ask what are the next path what are the exits? 0:04:39.800 --> 0:04:42.960 Because I think there are many scenarios for Figma here 0:04:43.960 --> 0:04:44.240 all right? 0:04:44.279 --> 0:04:47.479 Bloomberg's Brady Ford on the collapse of the ad Pigma deal. 0:04:47.560 --> 0:04:49.799 Thank you. Staying in the world of deals. A blank 0:04:49.920 --> 0:04:52.560 check company set up by former New York Yankees all 0:04:52.560 --> 0:04:56.280 star Alex Rodriguez, is planning to merge with Satellite Communications 0:04:56.279 --> 0:04:59.039 provide a Link Global. Earlier I sat down with the 0:04:59.080 --> 0:05:02.320 CEOs of Link and slam Court to discuss have a listen. 0:05:03.279 --> 0:05:06.760 Link invented this technology. You go back to twenty fifteen 0:05:06.800 --> 0:05:10.680 when the original idea was created. Many people thought this 0:05:10.720 --> 0:05:15.200 is impossible, and we then invented all the core technology 0:05:15.240 --> 0:05:18.640 to connect to the standard phone already in your pocket 0:05:18.680 --> 0:05:20.560 with no change to the phone. People thought that was 0:05:20.600 --> 0:05:23.839 crazy thinking. Not only did we invent the tech, we 0:05:23.920 --> 0:05:27.520 then proved it and we have three operational commercially license 0:05:27.560 --> 0:05:31.960 satellites in orbit today and we're operational in five countries. 0:05:32.080 --> 0:05:35.159 We proved it on all seven continents in over two 0:05:35.200 --> 0:05:38.320 dozen countries, and so it puts us in a great 0:05:38.360 --> 0:05:41.360 position to bring this service to the world. There's huge 0:05:41.400 --> 0:05:44.279 demand for this. This is a life saving service with 0:05:44.440 --> 0:05:48.000 over five billion customers that have a phone today. 0:05:49.040 --> 0:05:53.599 Charles, you have the consolation well, a small constellation up 0:05:53.600 --> 0:05:56.520 and running, you have the commercial deals in place. This 0:05:56.720 --> 0:05:59.800 is an area just last week we learned that SpaceX 0:06:00.400 --> 0:06:02.960 wants to get into as well. Is there enough room 0:06:03.400 --> 0:06:06.520 for you and the likes of SpaceX to build out 0:06:06.600 --> 0:06:08.000 the SAT to sell network. 0:06:08.600 --> 0:06:11.280 Well, absolutely, so let me explain why. First of all, 0:06:11.440 --> 0:06:15.680 is completely validating that SpaceX wants to follow link right. 0:06:15.760 --> 0:06:18.880 We're the category creators. We inmitted this, we proved it, 0:06:19.120 --> 0:06:21.160 and there's a bunch of companies jumping in now that 0:06:21.600 --> 0:06:24.920 we've done it. But this is the key thing to understand. 0:06:24.960 --> 0:06:28.159 There's no one's going to get a monopoly in the 0:06:28.200 --> 0:06:31.600 mobile wireless industry. There's at least two or three winners. 0:06:31.720 --> 0:06:33.839 They don't let anybody get a monopoly. They didn't let 0:06:33.920 --> 0:06:36.960 Apple get a monopoly when they invented the modern smartphone. 0:06:37.400 --> 0:06:40.560 They pulled into existence Android within eighteen months. 0:06:40.800 --> 0:06:42.200 So there's going to be at least two. 0:06:42.200 --> 0:06:44.920 Maybe three winners in satellite direct the standard phone, it's 0:06:44.920 --> 0:06:47.440 going to be Link and one or two other companies. 0:06:47.520 --> 0:06:51.440 So that's a natural, it's best for the consumer, and 0:06:52.600 --> 0:06:54.520 it just completely validates what we're doing. 0:06:55.160 --> 0:06:57.960 Yeah, Alex, really similar question for you. In a lot 0:06:58.000 --> 0:07:00.200 of the SPACs that I've covered over the last three 0:07:00.279 --> 0:07:03.000 or four years, the ones that have gone wrong, is 0:07:03.040 --> 0:07:05.520 where due diligence was a problem. And I wondered how 0:07:05.600 --> 0:07:09.359 much of a concern entering a market with Link with 0:07:09.440 --> 0:07:13.000 a big competitor or potential competitor like SpaceX, how much 0:07:13.000 --> 0:07:14.680 of that was a consideration for you? 0:07:15.360 --> 0:07:15.920 Yeah, it was. 0:07:15.960 --> 0:07:18.600 And look, we are super disciplined that we'd rather not 0:07:18.720 --> 0:07:21.160 do as fact and take something in public unless we 0:07:21.200 --> 0:07:24.360 felt really passionate about it, where long term thinkers and 0:07:24.400 --> 0:07:28.120 our core values are aligned. I mean, it's such an 0:07:28.160 --> 0:07:31.320 exciting space to think that this is a trillion dollar 0:07:31.840 --> 0:07:36.320 business annually opportunity and to connect the unconnected, to think 0:07:36.360 --> 0:07:39.640 that Charles and Link can connect over a billion people 0:07:40.920 --> 0:07:43.440 more than we have today. And if you think at Amazon, 0:07:43.480 --> 0:07:46.000 if you think of Amazon ed how they've disrupted the 0:07:46.040 --> 0:07:49.440 retail business, what Link is is the disrupting business where 0:07:49.440 --> 0:07:51.760 you have these sale towers where you would need a 0:07:51.760 --> 0:07:55.600 football field or two to provide. Charles has created one 0:07:55.640 --> 0:07:58.720 that his satellites go in the size of a pizza 0:07:58.760 --> 0:08:00.880 box and then you set them to orbit and over 0:08:00.920 --> 0:08:03.240 the next five years there should be hundreds, if not 0:08:03.280 --> 0:08:06.600 thousands of these up at orbit alex rates. 0:08:06.720 --> 0:08:08.920 Is a good point, which is the industries you're trying 0:08:08.920 --> 0:08:11.679 to disrupt. But if you think about the end user, 0:08:11.800 --> 0:08:14.840 right me the consumer with the cell phone, it seems 0:08:14.880 --> 0:08:16.800 to be the carriers childs that you want to do 0:08:16.920 --> 0:08:17.520 business with. 0:08:18.400 --> 0:08:21.000 That is a key part of our strategy. We're partner 0:08:21.080 --> 0:08:24.960 with mobile phone companies like many people here in the 0:08:25.000 --> 0:08:27.559 United States, no Verizon AT and T AT T Mobile, 0:08:27.600 --> 0:08:31.720 but there's eight hundred around the world, and we are 0:08:31.760 --> 0:08:34.760 going to be a partner with mobile network operators around 0:08:34.840 --> 0:08:38.280 the world. It goes directly to our business model. We 0:08:38.360 --> 0:08:41.280 are going set up as a trusted partner of mobile 0:08:41.280 --> 0:08:45.080 network operators and it has huge implications for our economics. 0:08:45.360 --> 0:08:48.560 So we don't have to go sign up subscribers. We 0:08:48.640 --> 0:08:51.720 cut a deal with a mobile network operator and we 0:08:51.800 --> 0:08:54.920 instantly get a million to maybe one hundred million subscribers. 0:08:54.920 --> 0:08:59.200 So our subscriber acquisition cost because it uses the phone 0:08:59.240 --> 0:09:01.880 in your pocket, basically almost goes to zero. 0:09:04.840 --> 0:09:08.560 A rod Spack taking Linked Global and its CEO Charles 0:09:08.559 --> 0:09:12.400 Miller Public Caroline will being well valuation around eight hundred 0:09:12.440 --> 0:09:15.040 million dollars and they literally want to take on SpaceX. 0:09:15.240 --> 0:09:16.800 It's not a new story I thought i'd wake up 0:09:16.800 --> 0:09:17.720 to on a Monday morning. 0:09:17.920 --> 0:09:19.760 There's been quite a few stories to wake up to 0:09:19.880 --> 0:09:21.760 on this Monday morning. And one of them, in fact, 0:09:21.800 --> 0:09:24.640 another market moving story for US was the fact that 0:09:24.679 --> 0:09:28.000 Apple is holding sales of its flagship Apple Watch models in. 0:09:27.920 --> 0:09:28.760 The United States. 0:09:28.960 --> 0:09:31.480 I'm going to bring you yet another sort of antitrust 0:09:31.920 --> 0:09:33.040 story here as well. 0:09:33.160 --> 0:09:35.839 And what if you go right and overnight in China 0:09:35.920 --> 0:09:38.760 are colleagues reporting that the government crack down on the 0:09:38.880 --> 0:09:43.760 use of foreign handsets continues across government and state backed enterprise. 0:09:43.800 --> 0:09:46.360 And look at some of Apple's key suppliers. Broad Coom 0:09:46.440 --> 0:09:48.760 interestingly now up one point two percent, have been lower 0:09:48.760 --> 0:09:51.680 early in the session. Other key suppliers seem to be 0:09:51.720 --> 0:09:54.360 moving lower. On that news, we all have the details. Next, 0:09:54.640 --> 0:10:06.960 this is Bloomberg Technology. Okay, time for talking tech. And 0:10:07.000 --> 0:10:10.120 in the news, IBM has agreed to buy data integration 0:10:10.240 --> 0:10:14.560 platforms stream sets and web methods from Software ag for 0:10:14.640 --> 0:10:17.640 two point three billion dollars in cash. The deals expected 0:10:17.679 --> 0:10:20.600 to complete in the second quarter of twenty twenty four 0:10:20.920 --> 0:10:24.640 and is an effort to strengthen its AI and cloud capabilities. 0:10:25.000 --> 0:10:27.480 And since Time plunged the most in more than a 0:10:27.559 --> 0:10:32.040 year after its co founder's death, spooked investors already grappling 0:10:32.240 --> 0:10:35.640 with the fallout from slowing growth and US sanctioned since 0:10:35.720 --> 0:10:39.000 Time disclosed that its co founder, m major shareholder, died 0:10:39.040 --> 0:10:42.199 on Friday after an illness. The MIT graduate and Hong 0:10:42.280 --> 0:10:46.160 Kong professor was regarded as a pioneer in China's AI sector, 0:10:46.240 --> 0:10:49.320 helping create one of the nation's leaders in facial and 0:10:49.440 --> 0:10:54.240 image recognition. Plus more, Chinese agencies and government backed firms 0:10:54.240 --> 0:10:58.439 across the country have ordered staff to stop bringing iPhones 0:10:58.480 --> 0:11:01.640 and other foreign devices to work work. The formal directors 0:11:01.679 --> 0:11:04.640 follow a general mandate from months ago and sets in 0:11:04.679 --> 0:11:09.160 motion an unpre precedented prohibition that's likely to block Apple 0:11:09.280 --> 0:11:13.800 and Samsung from parts of the world's biggest smartphone market. Caroline. 0:11:13.880 --> 0:11:15.720 And there is so much to chew on when it 0:11:15.720 --> 0:11:18.240 comes to Apple today, ed, So let's stick with the 0:11:18.240 --> 0:11:21.199 company that's also confirming it's soon going to be halting 0:11:21.320 --> 0:11:23.880 sales of its flagship Apple Watch models right. 0:11:23.800 --> 0:11:24.800 Here in the United States. 0:11:24.840 --> 0:11:24.960 Now. 0:11:25.000 --> 0:11:27.719 The move comes following an ITC ruling as part of 0:11:27.760 --> 0:11:31.000 a long running pattern dispute between Apple and the medical 0:11:31.000 --> 0:11:36.400 technology company Massimo around the Apple Watches, blood oxygen sensor technology. 0:11:36.920 --> 0:11:40.000 Let's get our tape from our Bloomberg Intelligence and our 0:11:40.040 --> 0:11:40.719 Grana and. 0:11:40.760 --> 0:11:41.720 First the watches. 0:11:42.160 --> 0:11:44.479 This is quite a major step, but basically they're anticipating 0:11:44.520 --> 0:11:45.400 an import ban here. 0:11:46.480 --> 0:11:49.240 Yeah, Nie, we were expecting, you know, my colleague Hamlin 0:11:49.320 --> 0:11:51.520 Stern know a lot of work for this, that there 0:11:51.520 --> 0:11:53.920 would be a settlement by now between the two companies. 0:11:54.320 --> 0:11:56.200 And you know, we still have a few days. Let's 0:11:56.240 --> 0:11:58.920 see if this is just arm stronging by both the companies. 0:11:58.920 --> 0:12:01.520 But let's see what how happens. But we are hopeful 0:12:01.559 --> 0:12:04.400 that there'll be a settlement between them. 0:12:04.520 --> 0:12:08.600 The other story we're reported overnight amarag According to Bloomberg sources, 0:12:08.640 --> 0:12:12.200 this kind of government or public sector clamp down on 0:12:12.480 --> 0:12:16.000 foreign handsets in China. Right it started with I think 0:12:16.040 --> 0:12:19.880 Beijing and Chianjen. Now there are eight other provinces where 0:12:20.360 --> 0:12:24.800 state backed entities or companies government entities are saying leave 0:12:24.840 --> 0:12:28.240 your foreign handset at work by domestic Does that really 0:12:28.360 --> 0:12:32.080 impact Apple sales grow for or potential in China? 0:12:33.400 --> 0:12:35.880 Yeah, I think there isn't that much good news for 0:12:35.920 --> 0:12:39.120 Apple in the last several days. I think the iPhone 0:12:39.160 --> 0:12:42.040 news is something that you know, I mean all frankness, 0:12:42.200 --> 0:12:44.960 you don't expect the government employees to showcase their iPhones 0:12:44.960 --> 0:12:47.120 anyway in the public. That's just been you know, this 0:12:47.280 --> 0:12:49.720 is something you don't do for four years. But I 0:12:49.720 --> 0:12:51.920 think the bigger issue at that time right now is 0:12:52.280 --> 0:12:55.440 Huawei has a new forum with five G capabilities and 0:12:55.520 --> 0:12:58.240 that's really doing well in China right now. And you know, 0:12:58.320 --> 0:13:01.040 one reason could be that's a first stop graded many years. 0:13:01.320 --> 0:13:04.200 But I think iPhone really is on a back you know, 0:13:04.200 --> 0:13:05.400 backfoot at this point. 0:13:05.559 --> 0:13:06.960 So you know, when when they. 0:13:06.840 --> 0:13:10.199 Report results over the next couple of months, I think 0:13:10.640 --> 0:13:12.760 this is going to be the single most important question 0:13:13.559 --> 0:13:16.120 asked to Tim Cokz to you know, what's really happening 0:13:16.160 --> 0:13:18.880 in China and how should we expect because it is 0:13:18.880 --> 0:13:21.480 the biggest growth market for Apple in. 0:13:21.480 --> 0:13:26.040 Terms of you know, our phones, and Apple's. 0:13:25.640 --> 0:13:29.160 Up fifty percent year today the years always out fell 0:13:29.240 --> 0:13:32.680 twenty six percent in twenty twenty two. What's the story 0:13:32.720 --> 0:13:34.400 going to be for Apple in twenty twenty four. 0:13:35.640 --> 0:13:37.360 So, as far as we can see right now, I 0:13:37.400 --> 0:13:40.559 think the growth prospects are pretty tepid at this point. 0:13:40.600 --> 0:13:42.800 I mean, growth rate of three four five percent is 0:13:42.800 --> 0:13:44.680 nothing to really write home about. 0:13:44.720 --> 0:13:47.160 But you know, one of the reasons. 0:13:46.720 --> 0:13:50.120 People look at Apple is because of it's it's you know, 0:13:50.160 --> 0:13:52.280 what we call as a flight to quality, and with 0:13:52.360 --> 0:13:54.719 interest rates going down, that has helped some of the 0:13:54.800 --> 0:13:55.800 larger tech naus. 0:13:55.960 --> 0:13:57.880 But fundamentally, I think Apple. 0:13:57.640 --> 0:13:59.280 Still needs to do a little bit of work to 0:13:59.320 --> 0:14:02.480 showcase that they can get back to that high single 0:14:02.520 --> 0:14:05.320 digit to load double digit growth rate. But we don't 0:14:05.320 --> 0:14:07.199 think that's going to happen next year, next twelve months. 0:14:07.240 --> 0:14:08.280 It's going to be tough for them. 0:14:08.960 --> 0:14:10.839 We of course, have seen that there's been a slight 0:14:10.960 --> 0:14:14.600 pivot from a supply chain perspective looking towards India and 0:14:14.640 --> 0:14:17.520 indeed looking towards India as a demand driver as well 0:14:17.520 --> 0:14:19.240 an rug Is that going to be some sort of 0:14:19.240 --> 0:14:22.400 a silver lining amid the pullback in China and a 0:14:22.440 --> 0:14:24.400 more difficult outlook for twenty twenty four. 0:14:25.520 --> 0:14:27.200 Yeah, I mean, in the long term, India is a 0:14:27.280 --> 0:14:29.800 very big growth market for them, that's no doubt about it. 0:14:29.960 --> 0:14:31.600 But that's something I think it's going to play it 0:14:31.640 --> 0:14:33.120 into three to five years range. 0:14:33.280 --> 0:14:34.760 Over the next two to three years. 0:14:34.880 --> 0:14:37.480 China remains one of the most important things because the 0:14:37.520 --> 0:14:41.000 purchasing power of consumers in China still is a lot. 0:14:40.840 --> 0:14:42.520 More than what it is in India. 0:14:42.600 --> 0:14:45.000 In India, if you look at the smartphone market, you know, 0:14:45.040 --> 0:14:48.040 Apple doesn't even qualify for ninety five percent of the 0:14:48.120 --> 0:14:50.440 unit shipments because they are below three hundred dollars. 0:14:50.560 --> 0:14:52.080 Apple doesn't play in that market. 0:14:52.320 --> 0:14:58.040 So while the population size is very attractive and very appetizing, 0:14:58.120 --> 0:15:01.560 but the smartphone growth is not there just from units 0:15:01.600 --> 0:15:02.760 at this point, all. 0:15:02.720 --> 0:15:05.680 Right, Bloomberg Xander Egran or Bloomberg Intelligence, great to get 0:15:05.720 --> 0:15:07.520 your analysis on a lot of Apple news. 0:15:14.920 --> 0:15:17.600 Let's turn our attention to Nvidia now and then really 0:15:17.600 --> 0:15:21.000 fascinating deep dive by Bloomberg highlighting the threat that AI 0:15:21.080 --> 0:15:24.920 poses to minorities. This is highlighted by two former employees 0:15:24.960 --> 0:15:28.200 of Invidia who warn the CEO of the consequences of 0:15:28.280 --> 0:15:32.040 artificial intelligence on marginalized communities. Thus far, and Video has 0:15:32.080 --> 0:15:34.400 declined to comment on the specifics of the meeting that 0:15:34.480 --> 0:15:35.240 was conducted, but. 0:15:35.200 --> 0:15:37.680 The company said it could quote continues to devote. 0:15:37.400 --> 0:15:42.240 Tremendous resources to ensuring that AI benefits everyone. Let's get 0:15:42.240 --> 0:15:45.520 to the reporter behind this incredible piece, Sindujo Rangarajan is 0:15:45.520 --> 0:15:48.760 with us and Sinduja it goes back several years to 0:15:48.800 --> 0:15:52.440 a meeting that they had with Jensen the CEO of Nvidia, 0:15:52.800 --> 0:15:55.400 and these two employees basically walked out feeling that they 0:15:55.400 --> 0:15:56.440 weren't hurt, right. 0:15:58.080 --> 0:16:04.520 Correct, got all good and alex Alexander Sodo, you know, 0:16:04.640 --> 0:16:08.840 they were both presidents of the Black Black Employees Group. 0:16:09.320 --> 0:16:12.200 But they work with executives and people from across the 0:16:12.240 --> 0:16:18.400 company to put together presentation for Jensen Huang, the CEO 0:16:18.400 --> 0:16:21.760 of f and video about the risks AI can post, 0:16:21.760 --> 0:16:24.000 how can we make AI safe and the general topic 0:16:24.040 --> 0:16:27.760 about AI ethics, and they wanted to make sure that 0:16:27.840 --> 0:16:31.040 you know, the company which is supported which which they 0:16:31.080 --> 0:16:33.760 claim is you know, going to be a major AI 0:16:33.840 --> 0:16:37.560 superpower in the future, should do something about this. Have guardrails, 0:16:37.640 --> 0:16:39.480 have processes and frameworks that. 0:16:39.480 --> 0:16:41.479 Make sure that AI is safe. 0:16:42.920 --> 0:16:46.080 And they and then they they you know, walked out 0:16:46.080 --> 0:16:50.560 of the meetings not feeling heard and they quit shortly after. 0:16:51.040 --> 0:16:53.480 A part of this is not just the not feeling 0:16:53.560 --> 0:16:57.280 heard or basically an inaction by video from their point 0:16:57.320 --> 0:17:01.080 of view, was the idea that it's the people building 0:17:01.120 --> 0:17:04.560 the technology. It's important that there's diversity within it, right, 0:17:04.600 --> 0:17:09.360 And you dug down into in videos workforce, essentially it's 0:17:09.440 --> 0:17:12.399 hiring relative to some of its peers. What did you 0:17:12.480 --> 0:17:13.920 find and why is that important? 0:17:14.680 --> 0:17:17.520 You know, there's a lot of research that says that 0:17:17.720 --> 0:17:21.760 you know, particularly for AI, but technology as a whole, 0:17:22.080 --> 0:17:26.280 that as an industry, it's so it has such few 0:17:26.359 --> 0:17:30.080 underrepersent and minorities that it's likely to miss blind spots 0:17:30.320 --> 0:17:32.879 when it comes to building these tools that you know 0:17:33.400 --> 0:17:37.920 are supposed to be the future of technology. And when 0:17:37.960 --> 0:17:42.640 I looked into in videos, you know, diversity numbers, they 0:17:42.720 --> 0:17:45.399 were in the bottom two for sm P one hundred 0:17:45.480 --> 0:17:50.480 four underrepersent and minorities, Black, Hispanic, mixed races of people. 0:17:51.080 --> 0:17:58.440 And you know, it's important because research says that if 0:17:59.040 --> 0:18:02.760 if you don't have these people involved in discussions as 0:18:02.760 --> 0:18:05.720 you're building products, then you know you're likely to miss 0:18:05.760 --> 0:18:06.680 by blind spots. 0:18:07.000 --> 0:18:10.040 We read in Vidia's statement in response to the story 0:18:10.119 --> 0:18:12.159 at the beginning of the segment. But what is the 0:18:12.200 --> 0:18:14.600 net result of this reporting, Ben, what kind of action 0:18:14.800 --> 0:18:18.320 is in video taking and has anything improved? 0:18:19.600 --> 0:18:21.920 They, you know, the meeting happened a while ago in 0:18:22.040 --> 0:18:25.080 video claims that it's done a tremendous amount of work 0:18:25.280 --> 0:18:29.399 in thinking about this issue, and they've hired you know, 0:18:29.520 --> 0:18:34.679 Nikki Pope to run their trustworthy AI division. They've you know, 0:18:34.720 --> 0:18:37.720 made sure that their data sets that the models are 0:18:37.760 --> 0:18:41.560 trained on are debiased, and they've put in a lot 0:18:41.560 --> 0:18:44.000 of work into making their models are transparent and not 0:18:44.080 --> 0:18:48.399 as black foxy. They have released something called this openly 0:18:48.520 --> 0:18:52.560 more Guardrails, which is supposed to keep chatbots safe and 0:18:52.600 --> 0:18:56.320 on topic and appropriate. So they claim to have done 0:18:56.480 --> 0:18:59.480 a lot of work since that meeting and since that 0:18:59.640 --> 0:19:02.320 time to make sure that you know AI is safe 0:19:02.320 --> 0:19:02.960 and transparent. 0:19:03.160 --> 0:19:06.040 Because it's worth reminding people that these two employees when 0:19:06.040 --> 0:19:08.080 they first went to the CEO Jensen, it was back 0:19:08.080 --> 0:19:10.680 in twenty twenty. A lot has changed, a lot of 0:19:11.080 --> 0:19:14.280 soul searching among corporate America has occurred since, of course, 0:19:14.320 --> 0:19:17.120 the tragic death of George Floyd as well. I'm interested 0:19:17.160 --> 0:19:20.159 in ultimately the real part of AI they seem to 0:19:20.160 --> 0:19:20.919 be worried about. 0:19:21.359 --> 0:19:23.399 Is facial recognition, correct. 0:19:24.359 --> 0:19:27.080 That's one of the big pieces, and that was one 0:19:27.080 --> 0:19:29.479 of the things that they raised during that meeting. You know, 0:19:29.960 --> 0:19:32.800 we'll there's a lot of research that says already that 0:19:32.920 --> 0:19:38.720 facial recognition technologies in general, you know, don't identify people 0:19:38.760 --> 0:19:42.800 of color quite well. So this was just just generally raised. 0:19:42.840 --> 0:19:45.600 You know, if that's going to be powering self driving cars, 0:19:45.760 --> 0:19:48.040 then you know what's going to happen, Like what if 0:19:48.040 --> 0:19:52.160 they don't recognize people with darker skins or different kinds 0:19:52.160 --> 0:19:53.600 of people in general. 0:19:54.520 --> 0:19:58.119 A right, Bloomberg's Induja and Garage and just really important 0:19:58.160 --> 0:20:01.320 and deep reporting on video company that everyone has become 0:20:01.400 --> 0:20:12.920 so obsessed with throughout twenty twenty three. Welcome back to 0:20:12.920 --> 0:20:15.959 Bloomberg Technology. Ed love Low here in San Francisco. 0:20:15.600 --> 0:20:16.520 Carolin Hired in New York. 0:20:16.560 --> 0:20:18.760 Let's get a check on these markets, because we're managing 0:20:18.760 --> 0:20:21.040 to hold firm in the NASDAQ stock still managing to 0:20:21.080 --> 0:20:23.840 power on hire. Remember we've had seven straight weeks of 0:20:23.840 --> 0:20:25.720 gains in the S and P five hundred, but still 0:20:25.720 --> 0:20:27.760 the moon music is positive inequities even though in the 0:20:27.760 --> 0:20:29.560 bob market we're selling off a little bit. Is we 0:20:29.600 --> 0:20:31.600 get a little bit more caution coming from some of 0:20:31.640 --> 0:20:33.840 those fed voices. We look to a voj whether or 0:20:33.920 --> 0:20:37.000 not they'll be amping up some discussion of central bank 0:20:37.080 --> 0:20:38.840 policy as the ECB tries to say, look, you are 0:20:38.880 --> 0:20:40.720 front running us on the idea that we're going to 0:20:40.720 --> 0:20:43.879 be cutting rates. Here US ten year yield currently up 0:20:43.920 --> 0:20:46.080