WEBVTT - Tesla China Price Cuts and PayPal's Stablecoin 0:00:01.440 --> 0:00:05.720 From Mahart where Innovation, money and power Collie in Silicon 0:00:05.840 --> 0:00:10.160 Vallet and beyond. This is Bloomberg Technology with Caroline Hyde 0:00:10.200 --> 0:00:11.120 and Ed Ludlow. 0:00:25.520 --> 0:00:28.120 I'm Caroline hide a Bloomberg's WORLDEAD quarters in New York, 0:00:28.600 --> 0:00:29.960 and I'm Ed Load in San Francisco. 0:00:30.000 --> 0:00:33.920 We're back Carrow. This is Blueboy Technology and Ed coming up. 0:00:34.000 --> 0:00:36.600 The Tesla challenge that the company cuts. 0:00:36.280 --> 0:00:40.160 Its prices in China again, smoking worries of another global 0:00:40.240 --> 0:00:40.760 price war. 0:00:41.680 --> 0:00:45.120 Plus PayPal has a new CEO, finally details on the 0:00:45.159 --> 0:00:48.479 company's new leader and now he may be able to 0:00:48.520 --> 0:00:51.840 help a stock that's slumped. This growth slowed post pandemic. 0:00:51.960 --> 0:00:55.120 Oh and Zuckerberg telling speculators that it's time to move 0:00:55.200 --> 0:00:58.040 on from the potential cage fight with Elon Musk. But 0:00:58.120 --> 0:01:00.840 will we more on that later this hour, But first, 0:01:01.200 --> 0:01:03.160 let's check in on these markets. It's been a while 0:01:03.240 --> 0:01:04.960 since I've checked in on the men, and I'm looking 0:01:05.000 --> 0:01:08.040 at six tens percent higher on the Nasdaq, actually managing 0:01:08.040 --> 0:01:10.040 to pick ourselves up from some of the concerns we had, 0:01:10.120 --> 0:01:12.720 particularly anxiety around China. That is why I shine a 0:01:12.760 --> 0:01:14.880 light and what's happening with the big Chinese names that 0:01:14.880 --> 0:01:16.840 are traded here in the US. They are still under pressure, 0:01:16.959 --> 0:01:19.200 but as much as they were in earlier days trading 0:01:19.280 --> 0:01:20.920 they're off by more than one point three percent at 0:01:20.920 --> 0:01:22.960 one point, we're now off by about half of that. 0:01:23.120 --> 0:01:26.399 This still is the warriores, the anxiety around wealth management 0:01:26.560 --> 0:01:27.680 and exposure there in. 0:01:28.319 --> 0:01:30.240 Over in China, of course, was worrying. 0:01:29.959 --> 0:01:31.959 With the property market, basically how much the government will 0:01:31.959 --> 0:01:33.440 stimulate this particular economy. 0:01:33.600 --> 0:01:35.800 We are still seeing some anxiety in the bomb market 0:01:35.840 --> 0:01:36.400 that yields. 0:01:36.640 --> 0:01:38.480 What a couple of weeks I missed in terms of 0:01:38.520 --> 0:01:40.120 the tenure and the fact that we're now at four 0:01:40.120 --> 0:01:43.319 point almost two on the tenure that we're seeing we're 0:01:43.360 --> 0:01:45.039 basically at five percent on the two year, but we 0:01:45.120 --> 0:01:47.960 still see that yield move absolutely. 0:01:47.440 --> 0:01:49.040 Higher on the tenure as it stands. 0:01:49.040 --> 0:01:51.080 So still some warriors, I tell you, whether we've seen 0:01:51.120 --> 0:01:53.640 some resilience over the last few trading days, a little 0:01:53.680 --> 0:01:55.840 bit of a knockdown on Sunday trading, but remember that's 0:01:55.840 --> 0:01:57.040 because we have thin volumes, and. 0:01:56.960 --> 0:01:58.840 Look at the moment, we have thin volumes. 0:01:58.920 --> 0:02:00.920 No a matter really what asset class you look at, 0:02:01.000 --> 0:02:02.880 but I'm looking at what's happening is in Bitcoin, and 0:02:03.360 --> 0:02:05.360 we're still managed to tread water in that twenty nine 0:02:05.360 --> 0:02:06.040 thousand levels. 0:02:06.040 --> 0:02:07.800 So after the last few trading days. 0:02:07.600 --> 0:02:10.000 We very much feel range bound, a little bit pushing 0:02:10.080 --> 0:02:11.919 up on the higher side as we speak their ed. 0:02:12.760 --> 0:02:14.560 Yeah, three quick news stories we're going to give you 0:02:14.600 --> 0:02:17.280 more details on during the program. Tests down two percent, 0:02:17.600 --> 0:02:21.760 trimming prices on higher spec model wise in China. Steve Wesley, 0:02:21.800 --> 0:02:24.000 who's a former Tesla board member, is going to join 0:02:24.120 --> 0:02:26.640 us in just a moment. Sticking with the automotive theme. 0:02:26.720 --> 0:02:31.160 Ford is modestly higher. Peter Stern, longtime Apple alum, is 0:02:31.280 --> 0:02:34.839 joining Forward to lead the software and integrated services part 0:02:34.880 --> 0:02:37.680 of that business. We will bring you more details later on. 0:02:37.720 --> 0:02:41.119 And then PayPal finally has named it's CEO. We will 0:02:41.120 --> 0:02:43.520 tell you who that is later in the show. The 0:02:43.560 --> 0:02:46.600 big story overnight add at Asia is on high or 0:02:47.040 --> 0:02:50.000 fox Con is the unit we most closely cover. Shares 0:02:50.000 --> 0:02:53.160 actually up one point four percent. It's basically cut its 0:02:53.200 --> 0:02:56.520 sales outlook for the year, principally telling us that in 0:02:56.560 --> 0:03:00.240 the quarter and on a annual basis, the smartphone this 0:03:00.320 --> 0:03:03.280 is going to decline. In may Caro, they told us 0:03:03.320 --> 0:03:05.560 that it would be flat in terms of top line growth. 0:03:05.919 --> 0:03:09.000 This just adds to every story we've been covering in 0:03:09.040 --> 0:03:13.080 the last several weeks about the pain the smartphone market's 0:03:13.120 --> 0:03:16.400 feeling principally here in the United States. But remember Fox 0:03:16.480 --> 0:03:20.680 one or on Hi, the principal assembler of Apple's iPhone. 0:03:21.080 --> 0:03:23.800 It matches the narrative that we got from Apple execs 0:03:24.120 --> 0:03:25.520 just a week ago during earnings. 0:03:25.680 --> 0:03:25.920 Yeah. 0:03:25.960 --> 0:03:28.120 Apple, of course it's number one customer. But it also 0:03:28.160 --> 0:03:30.720 reflects what we've heard from quiralcom. When you've been hearing 0:03:30.760 --> 0:03:34.040 from TSMC this overall narrative that you and I the 0:03:34.040 --> 0:03:37.240 consumer are slow slowing our purchases of smartphones and the 0:03:37.360 --> 0:03:40.360 like electronics, but one also about business spend at the moment, 0:03:40.400 --> 0:03:42.920 how willing they are within this overall global economy. 0:03:43.040 --> 0:03:47.440 Ed, we're tracking kind of this like crystal ball of commentary. 0:03:47.800 --> 0:03:51.680 So Tim kirk Lukeameistrie saying two consecutive corners, a smartphone 0:03:51.680 --> 0:03:54.600 slow down here in the US. Sony, which people forget, 0:03:54.680 --> 0:03:58.520 is a massive supplier for the camera sensors the smartphone 0:03:58.520 --> 0:04:01.240 saying the rebounds coming twenty twenty. So it's a really 0:04:01.280 --> 0:04:03.720 dim outlook for what is a core piece of electronics 0:04:03.720 --> 0:04:05.800 for consumers and businesses globally. 0:04:05.640 --> 0:04:08.320 And I love the bluebug intelligence perspective always. 0:04:08.360 --> 0:04:10.040 You get it in the b wrap up and. 0:04:10.000 --> 0:04:12.880 Saying revenue could be affected by muted iPhone growth going 0:04:12.920 --> 0:04:16.880 into twenty twenty three margin pressure due to perhaps even 0:04:16.960 --> 0:04:19.680 a lockdown impact that we still remember of China, and. 0:04:19.800 --> 0:04:20.840 We want to stick on that theme. 0:04:20.920 --> 0:04:20.960 Ed. 0:04:21.040 --> 0:04:21.840 We want to stick on the. 0:04:21.839 --> 0:04:24.560 China because it's really the narrative of the day, isn't it. 0:04:24.600 --> 0:04:28.120 Tesla rolling out new rounds of price cuts over there, 0:04:28.160 --> 0:04:31.640 according to its Wabo account. Now it's reigniting those fears 0:04:31.640 --> 0:04:33.440 that we'd sort of pushed to the side for a minute. 0:04:33.480 --> 0:04:35.840 We thought this price war was on hold, But no, No, 0:04:35.960 --> 0:04:38.240 a whole host of watermakers over in Asia and then 0:04:38.320 --> 0:04:41.280 last week alone have been tapping back their prices. 0:04:41.360 --> 0:04:43.000 So we're really pleased to have. 0:04:43.040 --> 0:04:46.599 Well, a former insider, someone who knows the company very well, 0:04:46.920 --> 0:04:49.599 Wesley Group managing partner Steve Wesley, who served on the 0:04:49.600 --> 0:04:53.440 border Tesla you shared its audit committee for three years, Stephen, 0:04:53.839 --> 0:04:56.920 And really I thought we'd sort of put this anxiety 0:04:57.000 --> 0:04:59.480 to bed, some sort of agreement between the key players 0:04:59.480 --> 0:05:01.680 in China they wouldn't keep cutting prices, but it seems 0:05:01.680 --> 0:05:02.160 they have to. 0:05:05.360 --> 0:05:08.839 So resolution too. But Elon's hard to predict. But here's 0:05:08.839 --> 0:05:11.279 where I thing's happening. Every automaker in the world is 0:05:11.279 --> 0:05:15.200 going all electric. Tesla has a cost advantage over everybody else. 0:05:15.360 --> 0:05:17.640 They're simply put trying to grab market's share. 0:05:18.320 --> 0:05:21.039 What American investors, I think often don't understand is not 0:05:21.160 --> 0:05:24.280 only China the largest. 0:05:23.960 --> 0:05:26.040 Auto market in the world. Now you've got to win 0:05:26.200 --> 0:05:28.720 China if you're going to be the global winner. Tesla's 0:05:28.760 --> 0:05:29.719 being very aggressive. 0:05:30.040 --> 0:05:33.880 Interestingly, they make fifty four percent of all Tesla's made 0:05:33.880 --> 0:05:36.240 in China today. Part of the reason for that is 0:05:36.240 --> 0:05:38.760 they can make them less expensively, and I think if 0:05:38.800 --> 0:05:43.440 Elon's trying to take advantage of that price advantage she has, 0:05:43.480 --> 0:05:44.600 it's a low cost provider. 0:05:45.400 --> 0:05:47.800 I mean, you say they're going for market share, but 0:05:47.920 --> 0:05:53.479 bid is a face competitor. Ultimately, does it spell concerns 0:05:53.920 --> 0:05:56.520 more globally as well for ev competition. 0:05:57.720 --> 0:06:00.200 Look, yeah, no one's been crying for the Chinese. 0:06:00.400 --> 0:06:03.599 Of the top ten autograms in the world, seven of 0:06:03.600 --> 0:06:04.760 the ten are Chinese. 0:06:04.960 --> 0:06:07.720 So most Americans are thinking how afforded hum doing? 0:06:08.040 --> 0:06:11.960 The realist backdown is this it's Tesla Earth, the Chinese, 0:06:12.120 --> 0:06:15.279 the Volti Flaging coming in quickly because they the biggest 0:06:15.720 --> 0:06:17.719 solar vehicles in the world twenty twenty two. 0:06:17.839 --> 0:06:21.320 They've got deep pockets global manufacturing. Those are the big three. 0:06:21.400 --> 0:06:24.680 Everybody else is trying to catch up, so it'll be 0:06:24.720 --> 0:06:29.520 an interesting battle. What's so fascinating to me is Tesla 0:06:29.640 --> 0:06:31.719 really the leader in UBIS for a long time, the 0:06:31.720 --> 0:06:35.400 first ones to connect every vehicle. They've really led the world, 0:06:35.440 --> 0:06:39.240 not just to bring battery production in house, increase robotization 0:06:39.279 --> 0:06:44.680 and manufacturing, but probably most importantly, really taking the line's share. 0:06:44.560 --> 0:06:47.480 Of and optimizing for over the air software. 0:06:47.800 --> 0:06:51.679 That profit from software sales drops right to the bottom line. 0:06:51.800 --> 0:06:53.800 That's why the other use piece this morning. 0:06:53.480 --> 0:06:58.440 About Yes You've Got is for and hired Apple's Software 0:06:58.480 --> 0:07:01.480 Ahead to help them figure out their software pricing. 0:07:01.600 --> 0:07:02.960 They need that profitability. 0:07:03.920 --> 0:07:06.000 We're going to bring those details about Peter Stern later 0:07:06.000 --> 0:07:08.160 in the show. Here, Steve, let's remind our Bloomberg Technology 0:07:08.200 --> 0:07:12.400 audience about these specific cuts. It's a nineteen hundred dollars 0:07:12.440 --> 0:07:15.240 cut to the two highest spec model wise in China, 0:07:15.600 --> 0:07:18.240 so a four point five percent cut to the long 0:07:18.360 --> 0:07:21.640 range of three point eight percent to the performance spec 0:07:21.840 --> 0:07:24.360 of model. Ye, those are not the highest volume trims. 0:07:24.680 --> 0:07:26.520 But if Elon Musk came to you and said, you 0:07:26.560 --> 0:07:29.120 know what, I've changed my mind again. We're going to 0:07:29.200 --> 0:07:32.040 cut We're going to cut prices. We just keep targeting 0:07:32.680 --> 0:07:39.040 volume and growth, what would you have said to him. 0:07:37.240 --> 0:07:40.160 Well, OK, because I know better than most Elon's awfully 0:07:40.160 --> 0:07:43.240 hard to predict, fellow. But I'm looking at the market 0:07:43.240 --> 0:07:45.880 here and I'm just seeing Tell trade down a bit, 0:07:45.920 --> 0:07:49.760 and I know investors are thinking, gosh, reduce profitability. I 0:07:49.760 --> 0:07:51.160 think that's short sighted. 0:07:51.560 --> 0:07:58.240 Here. You have a global you know, battle, and. 0:07:58.360 --> 0:08:01.680 Testla has a chance to take more territory now, and 0:08:01.720 --> 0:08:05.280 I think they're doing precisely the right thing. Fifteen profitable quarters, 0:08:05.320 --> 0:08:08.840 close to twenty billion dollars in profitability last year. They 0:08:08.920 --> 0:08:11.600 can't afford it. Why not do the land grab now? 0:08:11.680 --> 0:08:14.000 I think that's what Tesla's thinking, and I think they're. 0:08:13.880 --> 0:08:14.480 Right to do it. 0:08:15.200 --> 0:08:19.440 Hey, Steve, How's how's China changed since the time you 0:08:19.520 --> 0:08:25.640 were on Tesla's forward as a priority for the company. 0:08:24.440 --> 0:08:28.160 China was not even a speck in the rear view mirror. 0:08:28.600 --> 0:08:30.400 You know, for the last fifty years, we've all been 0:08:30.440 --> 0:08:33.480 looking at the Japanese increasingly to the Koreans. They make 0:08:33.520 --> 0:08:38.080 out standing cars, and either way, Hundai and a key 0:08:38.160 --> 0:08:40.200 coming out of the iconic. These are great brands. They're 0:08:40.240 --> 0:08:43.440 going to be part of the picture. But China, simply put, 0:08:43.600 --> 0:08:47.079 was not in the picture. Fast forward twenty years. What's 0:08:47.120 --> 0:08:50.720 really changed? Those electric cars are really better virtually every way. 0:08:50.760 --> 0:08:53.720 The faster, the better for the planet. They're more reliable. 0:08:54.320 --> 0:08:56.640 The big fly in the oint minute is they just 0:08:56.760 --> 0:08:58.880 playing costs you much, but the cost per kilo one 0:08:58.920 --> 0:09:02.040 hour has gone down dramatically. Think about this, from eleven 0:09:02.120 --> 0:09:05.120 hundred dollars kill a lot hour down now to about ninety. 0:09:06.040 --> 0:09:08.040 The reason that Chinese are doing so well one, the 0:09:08.120 --> 0:09:11.720 Chinese government subsidizes to the auto companies. With two, most 0:09:11.840 --> 0:09:15.160 all of the auto batteries in the world are made 0:09:15.240 --> 0:09:18.520 in China, and that gives them a competitive edge in 0:09:18.600 --> 0:09:21.400 battery pricing. The real question is can the Chinese use 0:09:21.440 --> 0:09:24.280 their edge and lower cost batteries to catch up on 0:09:24.320 --> 0:09:28.760 the edge Tesla has in manufacturing and software. 0:09:29.520 --> 0:09:32.480 Hey, Caroline, Steve's got a great grasp on the data. 0:09:32.559 --> 0:09:35.640 He's talking about fifty four percent of production coming out 0:09:35.679 --> 0:09:38.160 of China, But it raises the question of warhod On, 0:09:38.200 --> 0:09:39.959 what have you cut back in China as well? 0:09:40.160 --> 0:09:43.200 Yeah, I mean when we're looking at what near third 0:09:43.440 --> 0:09:47.800 drop in shipments for the month of July coming from China, Steve, 0:09:47.880 --> 0:09:50.080 make this global for us for a moment, because they 0:09:50.080 --> 0:09:52.480 don't just produce in China. Yes, it's been a key 0:09:52.520 --> 0:09:54.800 area of focus, but they produce largely in the US. 0:09:54.840 --> 0:09:57.880 Also in Germany they're looking to expand how much are 0:09:57.880 --> 0:10:01.079 we going to see a curtailment of overall reduction or 0:10:01.200 --> 0:10:04.760 indeed a curtailment and overall profitability globally here? 0:10:05.960 --> 0:10:10.560 Well? Two points one, Tesla loves producing in China because 0:10:10.600 --> 0:10:13.600 costs here are so low. But you'd be foolish not 0:10:13.720 --> 0:10:16.280 to be aware of the Zeo political concerns on the lives. 0:10:16.320 --> 0:10:19.599 And that's why doubling down on the capacity size in 0:10:19.760 --> 0:10:22.160 the land, expanding capacity in China. 0:10:22.360 --> 0:10:24.839 You're about to break ground this month with a new 0:10:24.840 --> 0:10:27.480 plant in month ary in Mexico. So Tesla's not stup, 0:10:27.520 --> 0:10:28.679 but they're diversifying. 0:10:28.679 --> 0:10:32.120 They're going to other markets like Mexico they can enjoy 0:10:32.160 --> 0:10:35.400 the benefits lower cost vehicles. But I must say I 0:10:35.440 --> 0:10:38.800 think Elon having survived the tough times five, six, eight 0:10:38.880 --> 0:10:41.600 years ago where it wasn't even sure the company would survive. 0:10:41.960 --> 0:10:44.880 He's focused like a laser on making sure he has 0:10:44.960 --> 0:10:47.440 a cost advantage over the others. I think he's going 0:10:47.520 --> 0:10:49.959 to squeeze a lot of the new incumbents, and I 0:10:49.960 --> 0:10:52.520 think what you're going to see very quickly is this 0:10:52.600 --> 0:10:56.160 big global shakeout again between Tesla, we're sitting on top. 0:10:56.520 --> 0:10:59.599 The Chinese were coming quickly with very low cost batteries. 0:11:01.000 --> 0:11:04.440 Volkswagen, which is probably the other Western brand I think, 0:11:04.480 --> 0:11:08.040 has done the best at modernizing, bringing mattery production in house, 0:11:08.040 --> 0:11:10.439 and improving manufacturing capabilities. 0:11:11.320 --> 0:11:14.720 Steve very quickly a reaction to Zach Kirkhorm, the CFO 0:11:14.760 --> 0:11:17.560 of the last four years thirteen years of the company, 0:11:17.640 --> 0:11:18.440 leaving Tesla. 0:11:20.400 --> 0:11:24.320 Well, it's no surprise executives at Tesla tend to turn 0:11:24.320 --> 0:11:26.880 over fairly off of the fact that Zach survived as 0:11:26.920 --> 0:11:28.880 long as he did. It's a testament to him. But 0:11:29.000 --> 0:11:31.360 I don't think it's a surprise. You know, people tend 0:11:31.400 --> 0:11:33.920 to think Tesla is a one person company and Elon 0:11:34.000 --> 0:11:36.319 may be a visionary, but you got to give him 0:11:36.360 --> 0:11:39.160 and the Tesla board credit. They've built out their executive team. 0:11:39.360 --> 0:11:42.160 They're playing long ball here, and I think as you 0:11:42.200 --> 0:11:44.480 look at their revenues this year, I believe they'll crest 0:11:44.520 --> 0:11:47.520 one hundred billion dollars with the highest profitability in the 0:11:47.559 --> 0:11:48.320 auto industry. 0:11:48.720 --> 0:11:51.040 Hard to complain about what they're doing right now. They 0:11:51.040 --> 0:11:52.000 look a little smarter than. 0:11:51.960 --> 0:11:55.680 The rest Western Greek managing part of Steve Westley Greats. 0:11:55.679 --> 0:11:58.200 Have you back on the show, Caroline, and I thank 0:11:58.200 --> 0:12:00.280 you very much. All right, Time to move on here 0:12:00.280 --> 0:12:03.760 on Boombo Tech. That's what Meta CEO Mark Zuckerberg is 0:12:03.760 --> 0:12:06.920 telling the speculators about the cage fight between him and 0:12:06.960 --> 0:12:10.280 Elon Musk. Zuck took the threads on Sunday Nights, saying, quote, 0:12:10.280 --> 0:12:13.160 if Elon ever gets serious about a real date, an 0:12:13.200 --> 0:12:16.200 official event, he knows how to reach me. Otherwise, time 0:12:16.640 --> 0:12:18.800 to move on. I'm going to focus on competing with 0:12:18.880 --> 0:12:22.520 people who take the sports seriously reference to MMA. Elon 0:12:22.559 --> 0:12:24.720 Musk responded on X by saying he can't wait to 0:12:24.800 --> 0:12:28.080 bang on his door tomorrow, which today, And we're gonna 0:12:28.080 --> 0:12:29.959 have more in that story later this hour, Caroline, Real 0:12:30.000 --> 0:12:33.920 quick in the EV space, Nikola chees down significantly, almost 0:12:34.000 --> 0:12:36.880 nine percent, but they paired losses in this session. The 0:12:36.880 --> 0:12:38.920 reason I'm tracking this one is they buried the news 0:12:38.960 --> 0:12:42.920 frankly Friday night and said that a fire at their facility, 0:12:43.000 --> 0:12:45.679 which came from the battery packs of battery electric trucks, 0:12:46.160 --> 0:12:49.839 was not foul play as they previously said they suspected, 0:12:50.200 --> 0:12:54.280 but actually it was a malfunction in one of the 0:12:54.320 --> 0:12:57.040 suppliers of the battery pack. Again, this is a stock 0:12:57.120 --> 0:12:59.440 that's been an absolute roller coaster we've been talking about 0:12:59.760 --> 0:13:11.840 on the show. Amazon and US regulators are about to 0:13:11.840 --> 0:13:14.880 meet this week, the final step before a long shot 0:13:14.920 --> 0:13:17.439 bid to break up the tech giant. Amazon will try 0:13:17.440 --> 0:13:20.560 and argue that its behavior is harmless, seeking to avoid 0:13:20.600 --> 0:13:24.320 a full blown antitrust lawsuit in federal court. Will it work? 0:13:24.760 --> 0:13:28.000 It's the big question that's bringing in Bloomberg's senior executive 0:13:28.360 --> 0:13:31.319 editor for Technology. You're writing in Tech Daily about the showdown, 0:13:31.640 --> 0:13:34.720 and Bloomberg reported about the details of this meeting that 0:13:34.760 --> 0:13:38.520 the FTC commissioners and reps from Amazon. But it seems 0:13:38.559 --> 0:13:41.120 like despite the drama of the room, eyeball to eyeball, 0:13:41.679 --> 0:13:43.600 the FTC is going to go ahead anyway. 0:13:43.679 --> 0:13:47.160 Right, Yeah, I mean, it's interesting for what it represents. 0:13:47.200 --> 0:13:49.360 It's almost like the whistle at the beginning of the 0:13:49.360 --> 0:13:52.640 game and the formal of festivities. 0:13:52.840 --> 0:13:54.240 But it's a little bit of a ritual. 0:13:54.320 --> 0:13:57.920 In other cases that these meetings, also called last rites, 0:13:58.240 --> 0:14:01.959 can be significant. The company might bring a CEO, they 0:14:02.000 --> 0:14:05.880 might offer compromises to get out of the litigation. You know, 0:14:05.960 --> 0:14:08.800 in this case, it's very unlikely. I think that everybody 0:14:08.840 --> 0:14:11.560 is going through the motions here. The FTC has been 0:14:11.559 --> 0:14:14.679 on this course probably ever since Lena Khan was nominated 0:14:14.720 --> 0:14:17.840 as commissioner by the Biden administration. She made her name 0:14:18.400 --> 0:14:21.920 arguing that Amazon was a monopoly that behaved competitively, and 0:14:22.000 --> 0:14:24.520 so I think the company has probably assumed ever since 0:14:24.560 --> 0:14:25.800 then this day was coming. 0:14:26.160 --> 0:14:29.040 And you made some rather nice sporting analogies in your 0:14:29.440 --> 0:14:30.760 story about that one as well. 0:14:30.800 --> 0:14:32.280 Brad, just outline, if you. 0:14:32.320 --> 0:14:35.760 Will, just remind us where the key argument you think 0:14:35.840 --> 0:14:37.280 could land could stick. 0:14:38.400 --> 0:14:38.600 Yeah. 0:14:38.640 --> 0:14:43.560 I mean it's interesting, Caroline, because unlike other companies Microsoft 0:14:43.560 --> 0:14:46.320 in the nineties, maybe Googled today, I mean, Amazon doesn't 0:14:46.320 --> 0:14:49.160 have the kind of commanding market share that we think 0:14:49.200 --> 0:14:52.520 of as a monopoly. I mean, in some cases it's 0:14:52.720 --> 0:14:55.760 just a couple percentage points of overall retail. It's high 0:14:55.800 --> 0:14:58.480 forties in e commerce in general. But I think the 0:14:58.560 --> 0:15:02.400 FTC is likely to find this market as US retail marketplaces, 0:15:02.640 --> 0:15:06.440 so the likes of eBay or Walmart's marketplace new companies 0:15:06.480 --> 0:15:09.400 like Shean and Timu, and in this respect, Amazon really 0:15:09.440 --> 0:15:11.840 does have the kind of percentage market share we think 0:15:11.880 --> 0:15:15.840 of as a monopoly, high seventy percent. And what the 0:15:15.880 --> 0:15:18.880 FDC is likely to argue is that this situation isn't 0:15:18.920 --> 0:15:22.160 bad for consumers, which would be the traditional way to 0:15:22.600 --> 0:15:26.040 analyze antitrust, but it's bad for smaller businesses. It's bad 0:15:26.080 --> 0:15:28.920 for competition, and in particular it's bad for the small 0:15:29.040 --> 0:15:32.880 sellers that are forced to use Amazon, and that Amazon 0:15:32.960 --> 0:15:37.440 forces to use things like distribution fulfillment by Amazon or 0:15:37.480 --> 0:15:41.520 advertising is basically increasing the amount of take of percent 0:15:41.600 --> 0:15:43.800 of the commission that it takes from these sellers and 0:15:43.840 --> 0:15:46.960 creating a very unfavorable situation that at least will be 0:15:47.000 --> 0:15:48.080 the FDC's argument. 0:15:48.640 --> 0:15:52.840 We've been through this story with Meta in some sense, Apple, 0:15:52.880 --> 0:15:57.200 most recently market Soft and Activision, and investors don't seem 0:15:57.240 --> 0:16:00.240 to worry. Look at the shed performance you today. We 0:16:00.240 --> 0:16:04.240 always ask ourselves are they paying attention the upwood trajectory 0:16:04.240 --> 0:16:06.400 of this stock would suggest, even if they are, they 0:16:06.520 --> 0:16:07.360 sanguine about it. 0:16:07.840 --> 0:16:10.760 Yeah, two thirds increase this year in respect to Amazon. 0:16:10.960 --> 0:16:13.400 And look, judges haven't been all that favorable to this 0:16:13.560 --> 0:16:15.640 FDC either, right, I mean they've lost a lot of 0:16:15.680 --> 0:16:19.880 these cases, and all the anti trust experts I spoke 0:16:19.920 --> 0:16:22.200 to think that the odds are long for the FDC 0:16:22.520 --> 0:16:25.160 with this case as well. So no, I think that 0:16:25.160 --> 0:16:28.360 investors are paying attention. I think they realized that, you know, 0:16:28.400 --> 0:16:31.440 this FDC, the record hasn't been great, and what they're trying, 0:16:31.480 --> 0:16:34.640 which is a kind of wholesale reinterpretation of anti trust 0:16:34.720 --> 0:16:37.680 law you know, so far, hasn't been that successful in 0:16:37.680 --> 0:16:38.120 the courts. 0:16:38.320 --> 0:16:41.000 Even after that, stock wise, there are sixty buys from 0:16:41.040 --> 0:16:43.880 analysts on this stock, zero cells. 0:16:44.240 --> 0:16:46.560 Bradstone were neat to have you. Thank you so much 0:16:46.560 --> 0:16:48.240 as we look ahead to that this week. 0:16:48.320 --> 0:16:51.680 Meanwhile, coming up some strange live streaming trends that are 0:16:51.680 --> 0:16:52.760 taking off on TikTok. 0:16:53.040 --> 0:16:54.680 I'm going to discuss them a little bit more. 0:16:55.440 --> 0:16:57.960 And before we go to the robot dancers, let's get 0:16:57.960 --> 0:17:00.320 in on what is the dancer. We work a penny 0:17:00.320 --> 0:17:03.480 stock just twenty four cents and trades at was a 0:17:03.560 --> 0:17:05.880 record low last week, after, of course, it said it's 0:17:05.880 --> 0:17:08.680 got concerns about being a going concern, and it managed 0:17:08.680 --> 0:17:10.960 to rally once again on the day a third straight day. 0:17:11.520 --> 0:17:13.120 This is bluemog technology. 0:17:23.800 --> 0:17:27.320 Time for Talking tech First. Former Apple executive Peter Stern 0:17:27.680 --> 0:17:30.600 is getting a new start at Ford. Sterner's named president 0:17:30.760 --> 0:17:34.400 of the newly formed Ford Integrated Services, where he'll oversee 0:17:34.600 --> 0:17:37.760 software and services for some of Ford's key models. Stern 0:17:37.840 --> 0:17:40.879 served as Vice president of Services at Apple for more 0:17:40.920 --> 0:17:43.399 than six years, where he was a driving force behind 0:17:43.440 --> 0:17:46.800 the launch of Apple's portfolio of services like Apple TV 0:17:46.920 --> 0:17:50.159 plus plus. MasterCard is buying a minority stake in the 0:17:50.160 --> 0:17:54.960 financial technology unit of Africa's biggest wireless carrier MTN Group. 0:17:54.960 --> 0:17:58.440 While the size of MasterCard, Steak won't be disclosed until 0:17:58.480 --> 0:18:02.200 the transaction is closed, says that it's fintech unit values 0:18:02.400 --> 0:18:05.879 it at five point two billion dollars. And Elon Musk 0:18:05.960 --> 0:18:10.360 has been backing the Population Well Being Initiative Bloomberg's reporting 0:18:10.480 --> 0:18:13.560 in twenty twenty one, mustinated some ten million dollars to 0:18:13.640 --> 0:18:17.959 the research group at the University of Texas Austin devoted 0:18:18.200 --> 0:18:20.239 to the study of population. We now know where that 0:18:20.320 --> 0:18:23.399 money went. Musk has been outspoken about the dangers of 0:18:23.440 --> 0:18:25.359 population collapse for some time. 0:18:25.520 --> 0:18:26.920 Caroline fascinating one. 0:18:26.960 --> 0:18:29.320 Meanwhile, let's move on from an end, because we've got 0:18:29.320 --> 0:18:31.520 to talk about the latest TikTok trend for just a second. 0:18:32.320 --> 0:18:33.200 I didn't you love my dad? 0:18:33.280 --> 0:18:34.640 I just had an entanglement with a dollar. 0:18:34.840 --> 0:18:36.479 Thank you for the snapbed heart thinking of the pin 0:18:36.880 --> 0:18:37.320 pin pillar. 0:18:37.560 --> 0:18:42.639 H confused. That's okay. It's a relatively new trend. 0:18:42.800 --> 0:18:46.720 The users are live streaming themselves while acting like robots, 0:18:46.840 --> 0:18:49.439 reacting with robot like one liners as if they're kind 0:18:49.440 --> 0:18:51.880 of in a video game. That kind of stream might 0:18:51.960 --> 0:18:54.440 be a bit weird, but it's also the biggest live 0:18:54.560 --> 0:18:57.000 video trend to hit TikTok in the United States, So 0:18:57.320 --> 0:18:58.119 we've got to talk at all. 0:18:58.320 --> 0:19:00.320 It's a brilliant piece written by Alex bro In. 0:19:00.359 --> 0:19:04.919 Care to break down exactly antics what NPC non playable 0:19:05.040 --> 0:19:07.879 character trend is all about? Why is it going to 0:19:07.920 --> 0:19:09.680 help TikTok sell stuff here in the US? 0:19:10.440 --> 0:19:13.040 Well, if you're just somebody who's seeing that for the 0:19:13.080 --> 0:19:16.160 first time, it looks weird, it looks silly, but it's 0:19:16.359 --> 0:19:18.119 really potentially. 0:19:17.600 --> 0:19:18.720 Important for TikTok. 0:19:18.760 --> 0:19:21.960 As you mentioned, Caroline, this is the biggest trend on 0:19:22.320 --> 0:19:25.320 live stream video in the US for TikTok since it's 0:19:25.359 --> 0:19:27.640 really been pushing it, and live stream video for TikTok 0:19:27.680 --> 0:19:30.160 is more than just people you know, getting gifts sent 0:19:30.200 --> 0:19:32.520 to them making money off of those gifts. It's a 0:19:32.600 --> 0:19:37.000 key part of its global commerce strategy. TikTok's super strong 0:19:37.000 --> 0:19:40.000 in e commerce in places like Southeast Asia and live 0:19:40.040 --> 0:19:43.399 stream commerce live stream video where folks sell things, that 0:19:43.560 --> 0:19:45.840 is kind of the key to their commerce over there 0:19:46.160 --> 0:19:48.200 here in the US, though that hasn't worked. 0:19:48.240 --> 0:19:50.760 I talked to sources close to the company and they said, 0:19:51.080 --> 0:19:51.840 as they've. 0:19:51.600 --> 0:19:54.560 Moved commerce over here for TikTok, they've actually had to 0:19:54.600 --> 0:19:58.879 split their strategy. They're both educating and evangelizing live stream 0:19:59.000 --> 0:20:00.960