WEBVTT - OpenAI Targeted in Complaint and Nasdaq's Rally 0:00:01.520 --> 0:00:06.720 From hard where Innovation, money and power Collie in Silicon Valley, NBR. 0:00:07.120 --> 0:00:11.119 This is Bloomberg Technology with Caroline Hide and Ed Ludlove. 0:00:24.960 --> 0:00:27.280 Ed Love o here in San Francisco. Caroline Hide is 0:00:27.320 --> 0:00:30.880 off this week. This is Bloomberg Technology coming up Open 0:00:30.920 --> 0:00:34.440 AI targeted in a complaint to the FTC demanding a 0:00:34.560 --> 0:00:38.680 halt to further deployment of generative AI technology. Will Speaks, 0:00:38.720 --> 0:00:41.600 one of the signatories who called for the original pause 0:00:41.640 --> 0:00:44.800 of further jack GPT rollouts. In just a few moments 0:00:44.880 --> 0:00:47.720 time and the bulls are back full market coverage ahead. 0:00:47.800 --> 0:00:49.880 Is the tech sector leads the way? Then? Has that 0:00:49.960 --> 0:00:52.800 one hundred heading for its second best quarter of the decade. 0:00:52.880 --> 0:00:58.880 How does that translate to private markets? Plus conversations spanning cybersecurity, venture, cabital, 0:00:58.960 --> 0:01:01.639 the metaverse and beyond. We'll bring you the inside from 0:01:01.640 --> 0:01:03.960 the c suite for all the latest and all corners 0:01:04.120 --> 0:01:06.839 for the technology sector. Let's get your markets. We're moving 0:01:06.880 --> 0:01:10.400 away from jitters around the banking sector, the FED firmly 0:01:10.440 --> 0:01:13.280 and focus. There's this kind of growing feeling that the 0:01:13.360 --> 0:01:15.759 rate heights cycle is coming to an end. You look 0:01:15.760 --> 0:01:17.600 at them as that one hundred up eight tenths of 0:01:17.680 --> 0:01:21.200 one percent, but outperforming the broader market. Continued out performance 0:01:21.240 --> 0:01:25.560 as semiconductors, but also the US listed chairs of Chinese technology. 0:01:26.040 --> 0:01:28.760 Little action in the bond market, kind of muted trading, 0:01:28.760 --> 0:01:30.040 but you look at the short end of the curve, 0:01:30.080 --> 0:01:32.680 the US two year at four point one percent. We're 0:01:32.680 --> 0:01:35.440 talking a lot about yield curve inversion of what that 0:01:35.600 --> 0:01:38.520 signals for a potential recession, but that is where the 0:01:38.600 --> 0:01:41.040 muted actions at at that short end of the curve. 0:01:41.400 --> 0:01:43.640 This is where we are the last few days of March, 0:01:43.720 --> 0:01:45.360 the last few days of the quarter, and then as 0:01:45.400 --> 0:01:49.040 that one hundred is kind of heading for its best quarter, 0:01:49.400 --> 0:01:52.520 second best quarter in the last decade, we're looking for 0:01:52.600 --> 0:01:55.240 signals in the trajectory of rates still, but also thinking 0:01:55.240 --> 0:01:57.600 about the Fed's balance sheet and what they're doing in 0:01:57.960 --> 0:02:02.440 terms of easing and how it's impacted the technology sector evaluations. 0:02:02.520 --> 0:02:04.480 That's the Matt grow picture. Hey with the micro out 0:02:04.480 --> 0:02:07.280 in New York Bloombos. Katy Gryfeld, Hey, Katie, Hey, ed Well, 0:02:07.280 --> 0:02:09.480 I want to start with bitcoin just for fun, because 0:02:09.480 --> 0:02:11.600 that's been one of the big stories this year, is 0:02:11.639 --> 0:02:14.400 this big bounce back that we've seen in the crypto 0:02:14.440 --> 0:02:17.200 space as a whole, led by Bitcoin, as you can 0:02:17.200 --> 0:02:20.520 see up year to date by more than seventy percent, 0:02:20.560 --> 0:02:23.320 and it's a real choose your own narrative. The true 0:02:23.320 --> 0:02:25.560 believers would tell you what we're seeing in the banking 0:02:25.600 --> 0:02:28.639 sector that just proves the promise of crypto and why 0:02:28.680 --> 0:02:31.960 you want to be in it. Maybe a more salable 0:02:32.440 --> 0:02:34.320 narrative would be what you're just talking about, what we're 0:02:34.320 --> 0:02:37.440 seeing with tech shares and a potential pivot coming from 0:02:37.440 --> 0:02:40.200 the FED. But in any case, Bitcoin up by seventy 0:02:40.240 --> 0:02:43.320 one percent year to day. Let's go back to reality, though, 0:02:43.360 --> 0:02:45.359 and talk about some of those single stock names, bed 0:02:45.400 --> 0:02:47.720 Bath and beyond. One of the stories today, the company 0:02:47.800 --> 0:02:51.440 filed to sell as much as three hundred million dollars 0:02:51.680 --> 0:02:54.160 worth of shares, has also came out with some preliminary 0:02:54.200 --> 0:02:57.040 sales figures that disappointed in a big way. You can 0:02:57.080 --> 0:03:00.760 see shares off by more than nineteen person. Moving on 0:03:00.800 --> 0:03:03.320 Ali Bob, of course, the news from earlier this week 0:03:03.400 --> 0:03:06.480 is that it's going to split the Empire into six units. 0:03:06.480 --> 0:03:09.200 The news today, according to people familiar with the matter, 0:03:09.280 --> 0:03:12.880 is that its logistics arm is exploring a Hong Kong 0:03:13.320 --> 0:03:15.680 ipo that could come as soon as the end of 0:03:15.720 --> 0:03:19.200 this year, and JD dot Com maybe following suit. Two 0:03:19.200 --> 0:03:23.880 of its subsidiaries also potentially exploring a Hong Kong listed ipis. 0:03:23.919 --> 0:03:26.120 You can see JD dot Com up about nine and 0:03:26.160 --> 0:03:29.120 a half percent or so and C three AI at 0:03:29.200 --> 0:03:32.080 This is interesting. Even with all the headlines around AI 0:03:32.160 --> 0:03:35.360 that I know you've been following very closely, AI stocks 0:03:35.720 --> 0:03:38.680 not really feeling the heat yet. This stock in particular 0:03:38.720 --> 0:03:42.000 up about three points seven percent. Yeah, I think you know. 0:03:42.040 --> 0:03:44.920 The availability of capital, the energy from investors in this 0:03:45.000 --> 0:03:48.240 space is ongoing despite what's happening behind the scenes. Speaking 0:03:48.240 --> 0:03:50.840 of a prominent tech ethics group filed a complaint on 0:03:50.880 --> 0:03:54.280 Thursday with the US Federal Trade Commission urging the regulator 0:03:54.560 --> 0:03:58.320 to halt further commercial deployments of the next generations of 0:03:58.360 --> 0:04:02.080 AI technology that power popular tools like chat GPT. The 0:04:02.160 --> 0:04:05.760 Center for Artificial Intelligence and Digital Policy ask the FTTC 0:04:06.320 --> 0:04:10.000 to open an investigation into open AI to determine if 0:04:10.000 --> 0:04:13.000 the commercial release of the fourth generation of the tool 0:04:13.120 --> 0:04:16.360 violates US or global regulations. For more, let's bring a 0:04:16.440 --> 0:04:20.640 Nindo Managing editor covering tech and cybersecurity, Adam new York Lin. 0:04:20.720 --> 0:04:23.240 What do we know, Hied. It's nice to be here, 0:04:23.279 --> 0:04:25.839 thanks for having me. So, as you said, this very 0:04:25.920 --> 0:04:29.920 prominent tech ethics group has filed this complaint with the FTC, 0:04:30.200 --> 0:04:34.480 and very specifically, it's asking the US government to make 0:04:34.480 --> 0:04:37.800 a very rare intervention here and hit the puzz button 0:04:38.240 --> 0:04:42.159 on this huge boom and rush into building smarter and 0:04:42.360 --> 0:04:45.880 smarter generations of AI. Like you said, the complaint right 0:04:45.920 --> 0:04:50.360 now is focused on this GPT four language model, the 0:04:50.480 --> 0:04:53.359 latest one that is behind chat GPT, and as we 0:04:53.440 --> 0:04:57.040 all know by now, it's a very convincing simulation of 0:04:57.120 --> 0:05:00.360 human conversation, and that is the fear here. The group 0:05:00.440 --> 0:05:03.440 is specifically, as you said, asking for this investigation into 0:05:03.520 --> 0:05:08.000 open AI to see if GPT four's release actually violates 0:05:08.080 --> 0:05:11.839 existing regulations not just in the US but worldwide. And 0:05:11.920 --> 0:05:14.760 of course this comes just a day after more than 0:05:14.800 --> 0:05:17.719 a thousand people, some of them very prominent people in 0:05:17.760 --> 0:05:20.000 the AI and tech space, signed a letter urging the 0:05:20.040 --> 0:05:23.320 same Lynn, I think there's an important point of clarification 0:05:23.360 --> 0:05:25.040 that we've got to mate to our audience, which is 0:05:25.240 --> 0:05:28.560 this is not a complaint from the FTC. It's a 0:05:28.600 --> 0:05:32.800 complaint to the FTC by basically an interested party. Right, 0:05:33.480 --> 0:05:35.640 That is right. The complaint is being led by this 0:05:35.760 --> 0:05:38.760 center that is a tech ethics group that is very 0:05:38.760 --> 0:05:42.600 well known. Behind it is this long time privacy advocate 0:05:42.800 --> 0:05:45.640 Mark Rottenberg, who is trying to press the FTC to 0:05:45.640 --> 0:05:49.760 take action here. All right, Lyndon, managing editor covering tech 0:05:49.839 --> 0:05:52.839 cybersecurity out of New York, Thank you so much. Let's 0:05:52.839 --> 0:05:56.640 stick with this conversation. Bring in Stuart Russell Berkeley, director 0:05:57.000 --> 0:06:00.680 of the Center for Intelligent Systems for More's the second 0:06:00.800 --> 0:06:03.760 name on the list and that petition calling for a 0:06:03.760 --> 0:06:06.719 halt to AI development. He's also, of course the co 0:06:06.839 --> 0:06:12.880 author of the standard textbook Artificial Intelligence A Modern Approach. 0:06:13.640 --> 0:06:18.120 Let's start the basics, professor, why did you sign that petition? 0:06:20.480 --> 0:06:24.920 So the petition expresses the concern that these kinds of 0:06:24.960 --> 0:06:31.800 systems are extremely unpredictable. In essence, we have really no 0:06:31.960 --> 0:06:37.760 idea how they work inside, and so they simply don't 0:06:37.800 --> 0:06:42.040 comply with principles that have already been established. For example, 0:06:42.120 --> 0:06:45.360 the OECD has a set of principles that have been 0:06:45.400 --> 0:06:47.800 signed up to by the United States and all the 0:06:47.880 --> 0:06:53.479 other advanced economies saying that AI systems need to be 0:06:53.720 --> 0:07:00.000 shown that they will not present undue risk two users. 0:06:59.800 --> 0:07:02.240 And at the moment, there's no way that we can 0:07:02.279 --> 0:07:06.599 show that these large language models don't present undue risks 0:07:06.640 --> 0:07:09.680 because we don't know how they work. And there are 0:07:09.720 --> 0:07:17.000 already many many stories of apparently psychotic conversations the one 0:07:17.040 --> 0:07:21.160 reported in the New York Times, for example, a one 0:07:21.200 --> 0:07:24.680 reported in the Belgian press just the other day of 0:07:25.080 --> 0:07:29.760 chat GPT working with someone as they prepared to commit 0:07:29.760 --> 0:07:34.880 suicide and in some ways encouraging them to continue with 0:07:34.920 --> 0:07:40.480 that student. Those are the broad risks that the petition identifies. 0:07:40.520 --> 0:07:44.960 There are lots of questions about the petition itself. For example, 0:07:45.360 --> 0:07:49.360 when it was first published online, Sam Autman, the CEO 0:07:49.400 --> 0:07:53.720 of open AI's name was listed open Ai, told us 0:07:53.760 --> 0:07:56.480 at Bloomberg that he never signed it. Have any of 0:07:56.480 --> 0:08:00.760 the organizers or you as signatories among yourself of discussed 0:08:00.840 --> 0:08:03.080 that that's some of the names on that petition may 0:08:03.160 --> 0:08:06.960 not actually never have signed it. So I think what 0:08:07.080 --> 0:08:10.920 happens when you open one of these petitions for people 0:08:10.960 --> 0:08:14.160 to sign up online and add their names. A lot 0:08:14.200 --> 0:08:17.640 of jokers come along and put somebody else's name for fun, 0:08:18.160 --> 0:08:21.240 and probably someone thought it would be cool to pretend 0:08:21.280 --> 0:08:26.120 to be sample. When I think Shijinping, that name also appeared, 0:08:26.400 --> 0:08:30.920 and so very quickly the organizers realized that they were 0:08:30.920 --> 0:08:34.920 being subjected to a campaign of disinformation, so to speak, 0:08:35.520 --> 0:08:39.160 and so they put in steps to slow that down. 0:08:39.200 --> 0:08:43.680 Elon Musk is a signatory to this petition. I've written 0:08:43.679 --> 0:08:46.079 to Elon Musk multiple times in the last four d 0:08:46.080 --> 0:08:49.400 eight hours to try and confirm that he actually signed it. 0:08:50.320 --> 0:08:53.080 Are you confident that it was actually him that signed it? 0:08:55.640 --> 0:08:58.480 So I have to say I had no role in 0:08:58.520 --> 0:09:01.040 the preparation of the petition or in the vetting of 0:09:01.080 --> 0:09:05.520 the signatures. But Max Tegmark, who is the president of 0:09:05.640 --> 0:09:09.440 the Future of Life Institute, which organized the petition, is 0:09:09.480 --> 0:09:12.360 in direct contact with Elon Musk, and so I'm pretty 0:09:12.360 --> 0:09:16.840 confident that that's a real signature. What you're asking for 0:09:17.240 --> 0:09:21.480 is a halt of six months, a specific period where 0:09:22.000 --> 0:09:25.479 next generations of large language models or the underlying technology 0:09:25.559 --> 0:09:28.720 that powers the generative AI tools we're talking about, are 0:09:28.800 --> 0:09:32.840 not released. How realistic do you think that is? To 0:09:32.880 --> 0:09:39.760 coordinate that everyone agrees to just stop. I think there 0:09:39.800 --> 0:09:45.360 are different ways of viewing what we're asking for. I 0:09:45.400 --> 0:09:49.439 think the idea that you know the CEOs of Microsoft 0:09:49.520 --> 0:09:51.840 and Google and deep Mind are going to read this 0:09:51.920 --> 0:09:55.800 and say, oh, sorry, yeah, you're right, we completely messed up, 0:09:56.360 --> 0:09:59.320 and we'll definitely stop right now. I don't think that's 0:09:59.320 --> 0:10:04.280 going to happen, but I hope that it at least 0:10:04.360 --> 0:10:10.360 begins a serious conversation about what would be necessary to 0:10:10.400 --> 0:10:15.120 develop systems that we can have confidence in. And there's 0:10:15.400 --> 0:10:18.280 two parts to that, right, Could we develop ways of 0:10:18.320 --> 0:10:21.480 testing the systems that we already have so that we 0:10:21.520 --> 0:10:24.400 can show that they do not present risks that they 0:10:24.440 --> 0:10:28.200 will not help people to commit suicide and go on, 0:10:28.440 --> 0:10:31.640 or we change the way we design the system so 0:10:31.679 --> 0:10:33.319 that we can do that, And I actually think the 0:10:33.960 --> 0:10:37.680 latter is probably more likely. I would also say that 0:10:38.880 --> 0:10:43.680 legislators the European Union, for example, are close to passing 0:10:43.720 --> 0:10:47.559 the AI Act, which would require these kinds of steps 0:10:48.240 --> 0:10:51.600 as a matter of law, so that you could not 0:10:51.800 --> 0:10:55.600 put systems on the market unless you could satisfy the 0:10:55.679 --> 0:11:00.160 regulators that they were safe. Professor twenty four hours go, 0:11:00.360 --> 0:11:02.800 we had Sarah Gao, who's a founder of a VC 0:11:02.960 --> 0:11:06.040 firm called Conviction on the show. She's been investing in 0:11:06.120 --> 0:11:09.079 AI for a long time. She was not a signatory 0:11:09.120 --> 0:11:11.280 to the petition have listened to what she had to 0:11:11.280 --> 0:11:14.520 say about this. I really care about access and also 0:11:14.679 --> 0:11:17.319 a reinforcement of bias. But the thing to do is 0:11:17.360 --> 0:11:21.280 to address these concerns in like a open and transparent way, 0:11:21.440 --> 0:11:26.240 not to call for a halt to development. In the 0:11:26.280 --> 0:11:29.800 context of a halt or a six month period of 0:11:29.920 --> 0:11:34.320 non new releases, Sarah's point is that she thinks the 0:11:34.400 --> 0:11:38.760 technology should be made increasingly available. More broadly, what is 0:11:38.800 --> 0:11:42.840 the risk with that? Well, as she pointed out, the 0:11:42.920 --> 0:11:46.440 systems already exhibit bias and various other kinds of problems. 0:11:46.440 --> 0:11:52.000 So by making further generations of this technology available, which 0:11:52.080 --> 0:11:56.480 might be much more capable of causing serious disruption in 0:11:56.480 --> 0:12:00.200 our society, that would only make things worse, not or 0:12:00.240 --> 0:12:04.559 I think what we're asking for is that the developers 0:12:04.559 --> 0:12:09.120 of the technologies take their responsibilities seriously. A professor, We're 0:12:09.120 --> 0:12:11.080 grateful for your time. You're staying up late for us 0:12:11.080 --> 0:12:14.480 out of Singapore. You come at this from the academic perspective, 0:12:14.559 --> 0:12:18.000 the research and policy perspective. But when I went to 0:12:18.000 --> 0:12:21.240 our audience and asked about questions for you, they basically ask, 0:12:21.480 --> 0:12:25.480 is this just sour grapes? Is this those in the 0:12:25.520 --> 0:12:27.680 field that look at open AI and say you're the 0:12:27.800 --> 0:12:30.320 leader here, we are trying to catch up, and that's 0:12:30.320 --> 0:12:34.880 why we want to halt. No, not at all. I mean, 0:12:35.559 --> 0:12:39.040 we're not in the business of competing in the commercial market. 0:12:41.000 --> 0:12:45.840 Some of the underlying technologies of large language models emerged 0:12:45.920 --> 0:12:49.320 from academia, and pretty much all of the deep blening 0:12:49.320 --> 0:12:55.320 technologies emerge from academic and basic research lamps. So this 0:12:55.400 --> 0:12:59.520 is really a question of asking that the systems that 0:12:59.559 --> 0:13:01.920 are deployed by that affect the lives of billions of 0:13:01.960 --> 0:13:06.360 people are actually systems that we understand and that we 0:13:06.400 --> 0:13:12.000 can show our safe whose capabilities we get predict I 0:13:12.000 --> 0:13:15.840 don't think that's too much to ask. Stuart Russell Berkeley, 0:13:15.920 --> 0:13:18.880 Director of the Center for Intelligent Systems, Thank you again 0:13:18.920 --> 0:13:20.400 for your time and staying up late for us out 0:13:20.400 --> 0:13:31.679 of Singapore time. Now for talking tech today. Honey in 0:13:31.800 --> 0:13:34.400 On China, a new Hong Kong based fund, pans to 0:13:34.559 --> 0:13:37.320 raise one hundred million dollars this year to invest in 0:13:37.400 --> 0:13:41.880 digital assets startups. Prodigital Future has raised thirty million dollars 0:13:41.880 --> 0:13:45.000 so far, and we'll turge it early stage and developing ventures, 0:13:45.040 --> 0:13:48.360 particularly companies with ties to Web three. The fundraising comes 0:13:48.559 --> 0:13:51.840 as Hong Kong aggressively caughts crypto companies and talent to 0:13:51.960 --> 0:13:56.280 revive the financial center after the slowdown spurred by COVID lockdowns. 0:13:56.320 --> 0:13:59.920 The city sees digital assets is key to financial revival. 0:14:00.400 --> 0:14:03.760 Chinese regulators held a meeting with banks to gauge interest 0:14:03.920 --> 0:14:07.200 in taking over Silicon Valley banks stake in a local 0:14:07.280 --> 0:14:10.600 joint venture in a bid to safeguard the banking system 0:14:10.640 --> 0:14:13.000 from the lenders collapse here in the United States. The 0:14:13.120 --> 0:14:17.040 China Banking and Insurance Regulatory Commission convener meeting this week 0:14:17.280 --> 0:14:21.200 to discuss the disposal of svob's fifty percent holding in 0:14:21.560 --> 0:14:26.080 SPD Silicon Valley Banks. Some Chinese banks have already indicated interest, 0:14:26.320 --> 0:14:29.520 although discussions that are a very early stage. It's also 0:14:29.600 --> 0:14:33.680 unclear if regulators prefer a foreign buyer. An Ali Barber 0:14:33.760 --> 0:14:36.880 will consider gradually giving up controls some of its main 0:14:36.920 --> 0:14:41.120 businesses over time, after completing a major overhaul to create 0:14:41.280 --> 0:14:44.800 six new companies that may debut on public markets. The 0:14:44.840 --> 0:14:48.320 company's gain more than thirty billion US dollars of market 0:14:48.440 --> 0:14:51.720 value since Tuesday's announcement, which also fired up a rally 0:14:51.880 --> 0:14:55.240 in other Chinese technology shares. The new divisions will begin 0:14:55.400 --> 0:15:00.360 separate strategy planning. And now, according to Bloomberg's reporting, let's 0:15:00.360 --> 0:15:03.120 get to that reporting for more on Ali Baba. Bring 0:15:03.120 --> 0:15:05.840 in Bloomberg, says Bill Lee out in New York. Where 0:15:05.880 --> 0:15:08.080 are we right now with Ali Baba? Hi, Yeah, that's 0:15:08.120 --> 0:15:10.400 definitely the big news of today. Ali Baba said it 0:15:10.400 --> 0:15:13.240 will see control over its unit two of the six units, 0:15:13.240 --> 0:15:17.080 although when and where and by how much we still 0:15:17.120 --> 0:15:19.960 have to find out. Yesterday overnight there was a press 0:15:20.000 --> 0:15:23.320 conference or a press briefing blue the CEO, Daniel Zang, 0:15:23.320 --> 0:15:25.160 and there were three takeaways. So first is that it 0:15:25.160 --> 0:15:27.440 will be a case to case basis, as you've mentioned. 0:15:27.480 --> 0:15:31.120 The second is that the restructuring is already underway. We 0:15:31.200 --> 0:15:33.600 just don't know when or when it will be finalized, 0:15:33.640 --> 0:15:36.680 but it is underway. We've talked about this extensively this week. 0:15:36.720 --> 0:15:39.000 And the third is the CEO admitted that this is 0:15:39.080 --> 0:15:41.120 so that they will become more nimble and they will 0:15:41.160 --> 0:15:46.120 respond to the markets, market regulatory environment more positively. They 0:15:46.120 --> 0:15:48.080 said that they want to be more of an asset 0:15:48.080 --> 0:15:50.880 and capital operator rather than a business operator. But the 0:15:50.920 --> 0:15:54.400 CEO did stress that he wants to have more synergy 0:15:54.520 --> 0:15:57.320 still and it's also interesting because Ali Baba Holding that's 0:15:57.320 --> 0:16:00.560 its company names that will literally be the whole day company. 0:16:00.680 --> 0:16:03.640 And another news that also came across the bloombergwire today 0:16:03.720 --> 0:16:06.720 is the logistics arm of Ali Baba, that's Tinieo. It's 0:16:06.760 --> 0:16:10.000 already preparing for its first share sales, so it's targeting 0:16:10.000 --> 0:16:12.280 a listing as soon as the end of this year. 0:16:12.400 --> 0:16:14.920 And we've talked about this also that the two things 0:16:14.920 --> 0:16:16.360 that will come out of this is that it will 0:16:16.400 --> 0:16:19.320 revive a lackluster IPO market, most of which are I 0:16:19.440 --> 0:16:21.320 am Hong Kong. And the second is that it will 0:16:21.360 --> 0:16:23.560 just be more nimble in a piece of regulators after 0:16:23.640 --> 0:16:26.200 a crackdown that we've seen when Ali Baba tried to 0:16:27.960 --> 0:16:31.880 list its financial group for an IPO in twenty twenty. 0:16:32.640 --> 0:16:35.640 Right bloombos Isabella, we're sharing that chart of how long 0:16:36.000 --> 0:16:37.920 or how far the shares have to catch up before 0:16:37.960 --> 0:16:40.840 they hit the average twelve month price target. All right, 0:16:40.880 --> 0:16:43.840 Coming up, we're going to discuss cybersecurity risks and the 0:16:43.920 --> 0:16:47.640 threat posed by North Korean hackers. That's with MANNYANS Director 0:16:47.680 --> 0:16:50.920 of Intelligence John holt Quist also taking a look at 0:16:50.960 --> 0:16:53.920 crips a bit quite interesting. We've seen some undulations i'd 0:16:53.920 --> 0:16:56.440 put it in the last twenty four hours or so. 0:16:56.680 --> 0:17:00.120 We're at a twenty eight thousand level right now in 0:17:00.200 --> 0:17:02.960 terms of dollars per token, but there's a lot of 0:17:03.000 --> 0:17:06.600 momentum right now in discussion about bitcoin pushing higher to 0:17:06.880 --> 0:17:10.040 thirty thousand US dollars per token. In this session, we're 0:17:10.119 --> 0:17:12.760 kind of moving to the downside softer by a round 0:17:12.760 --> 0:17:16.680 a percentage point. We'll keep our sites set on bitcoin. 0:17:17.000 --> 0:17:33.640 This is Bloomberg North Korean hackers from a group known 0:17:33.640 --> 0:17:37.520 as APT forty three opposing as journalists, trying to gather 0:17:37.600 --> 0:17:42.000 intelligence about international officials approach to nuclear security policy and 0:17:42.160 --> 0:17:45.400 Kim Johnson's government. That's according to new research. For more 0:17:45.480 --> 0:17:49.200 on the nation's espionage capabilities, let's bringing John Holtquist, head 0:17:49.320 --> 0:17:53.840 of Mandian Threat Intelligence and Google Cloud. John, these are 0:17:53.880 --> 0:17:57.240 really interesting findings in the research that you've been driving. 0:17:59.600 --> 0:18:03.000 What are they trying to find out at specifically posing 0:18:03.000 --> 0:18:08.359 as journalists? Why that tactic? Well, people answer questions from journalists, 0:18:08.359 --> 0:18:11.199 So they're reaching out to people and think tanks and 0:18:11.359 --> 0:18:14.960 the defense industry, and you know, ultimately they want to 0:18:15.000 --> 0:18:18.680 compromise their systems. But what's so fascinating about this is 0:18:18.720 --> 0:18:22.360 they could just ask questions to these people and get responses. 0:18:22.720 --> 0:18:24.720 And really what North Korea is trying to do is 0:18:24.800 --> 0:18:27.800 gain decision advantage. They want to know if they'd launch 0:18:28.000 --> 0:18:30.480 a missile, how people are going to react, and these 0:18:30.480 --> 0:18:35.360 are the experts on those questions. So what do your 0:18:35.400 --> 0:18:40.479 findings tell us about their capabilities? How serious is what 0:18:40.520 --> 0:18:43.919 they're able to achieve. Well, you know what's so interesting 0:18:43.920 --> 0:18:47.360 about North Korean actors is a few years ago they 0:18:47.359 --> 0:18:50.600 started doing this espionage activity and it's clearly supporting their 0:18:50.680 --> 0:18:53.800 nuclear ambitions. But the other half of this is all 0:18:53.800 --> 0:18:58.679 the crypto to activity that they're involved in. They started 0:18:58.800 --> 0:19:03.040 using their spies to steal a money globally a few 0:19:03.119 --> 0:19:05.960 years ago, and even this team that has this espionage 0:19:06.000 --> 0:19:10.399 operation is stealing crypto on the side that there's a 0:19:10.440 --> 0:19:13.920 digital cyber component to this. But as part of your research, 0:19:14.000 --> 0:19:18.760 you point out in person interviews between those posing as 0:19:18.840 --> 0:19:21.600 journalists and experts are also taking place. So what is 0:19:21.640 --> 0:19:24.800 the Mandian strategy? How do you protect against both of 0:19:24.840 --> 0:19:28.120 those issues? Well, you know, we see them coming and 0:19:28.160 --> 0:19:31.240 pretending to be these people, and what we're lacking or 0:19:31.320 --> 0:19:33.680 the people who are getting hit are lacking is really 0:19:33.680 --> 0:19:37.760 a strategy of identifying who they're talking to, right I 0:19:37.800 --> 0:19:40.200 don't think, you know, if you are in a position 0:19:40.240 --> 0:19:43.440 where you're likely to be targeted by spies, you really 0:19:43.520 --> 0:19:46.040 need to up your game as far as who you're 0:19:46.040 --> 0:19:49.560 responding to, how you authenticate them, and what you know 0:19:49.800 --> 0:19:53.679 countermess you're taking. Is this unique to North career or 0:19:53.720 --> 0:19:56.640 did you see evidence that it's a tactic used elsewhere? 0:19:57.240 --> 0:20:00.480 Not at all. You know, we see Iranian actor carry 0:20:00.480 --> 0:20:04.120 out targeting pretinning to be journalists. The Russians are doing 0:20:04.240 --> 0:20:07.520 the exact same thing. They've got obviously a huge need 0:20:07.600 --> 0:20:10.399 for decision advantage right now, given that the war that 0:20:10.440 --> 0:20:13.280 they're in. If you are in a business that is 0:20:13.320 --> 0:20:16.040 likely to be targeted by spies, you really got to 0:20:16.080 --> 0:20:19.320 take care of who you're responding to. Will use the 0:20:19.359 --> 0:20:24.080 word spies, you know, we identify that according to the research, 0:20:24.240 --> 0:20:28.160 North Korean intelligence services are the ones directing this activity. 0:20:28.720 --> 0:20:32.560 Why is it that significant that the intelligence services of 0:20:32.600 --> 0:20:35.919 that country are kind of putting the strings. Well, you know, 0:20:35.960 --> 0:20:38.199 a long time ago, it took so much money and 0:20:38.280 --> 0:20:41.640 time to do human operations, and those still happen. People 0:20:41.720 --> 0:20:44.640 get We catch this human spies all the time, but 0:20:45.000 --> 0:20:47.880 it's so much cheaper and more efficient to use hackers 0:20:48.200 --> 0:20:50.920 or so many of these problems. And these guys can 0:20:50.920 --> 0:20:54.120 get answers in hours. They can literally go and ask 0:20:54.160 --> 0:20:57.520 somebody for a question and get the kind of answers 0:20:57.560 --> 0:21:01.159 intelligence services used to spend, you know, years trying to answer. 0:21:02.960 --> 0:21:06.160 What do you think happens next? I understand you don't 0:21:06.160 --> 0:21:09.520 have a crystal ball, but what are you bracing for? Well, 0:21:09.560 --> 0:21:11.840 you know what I'm really bracing for is them to 0:21:13.080 --> 0:21:16.480 up their game on the crypto side. We're right now 0:21:16.520 --> 0:21:19.520 in the midst of a major incident that is involving 0:21:19.760 --> 0:21:23.720 potentially thousands of organizations, and we think that, you know, 0:21:23.800 --> 0:21:25.840 one of the reasons that they're doing, that they're behind 0:21:25.840 --> 0:21:29.320 this incident is to gain access to crypto users. So 0:21:30.040 --> 0:21:33.080 that's going to affect organizations involved in crypto, that's going 0:21:33.119 --> 0:21:35.400 to affect everyday users. And that's one of the most 0:21:35.440 --> 0:21:39.520 interesting parts of this. You you, an average crypto investor 0:21:39.560 --> 0:21:42.600 could affect it all, right, John hold Quist and Mandy 0:21:42.640 --> 0:21:53.000 and bringing us the data. Thank you. Welcome back to 0:21:53.000 --> 0:21:55.679 bloom Big Technology. Ed Ludlow here in San Francisco now 0:21:55.760 --> 0:21:59.800 Twili out with its fourth annual State of Customer Engagement 0:22:00.200 --> 0:22:03.720 Report this year. The report states that data driven customer 0:22:03.760 --> 0:22:08.200 engagement does drive revenue growth and resilience for the brands 0:22:08.480 --> 0:22:11.399 they lean into. Its relio CEO Jeff Lawson back with 0:22:11.480 --> 0:22:13.800 us on Bloomberg Technology. Jeff, it's good to see you 0:22:14.640 --> 0:22:17.600 break that down into Layman's of course, break that down 0:22:17.600 --> 0:22:20.080 for me into Layman's terms. What are we talking about there? 0:22:20.080 --> 0:22:23.600 What does any of that actually mean? Companies that bother 0:22:23.720 --> 0:22:26.679 to pay attention to their customers and to build a 0:22:26.840 --> 0:22:31.359 relevant relationship and maintain relevance with that customer make more money. 0:22:31.400 --> 0:22:34.040 I mean, that's the basic Layman's term for it. And 0:22:34.080 --> 0:22:35.960 if you think about it, it makes sense. Right in 0:22:36.000 --> 0:22:39.600 a period of time where people had a lot of 0:22:39.640 --> 0:22:41.600 money burning a hole in their pocket, right, you didn't 0:22:41.600 --> 0:22:44.680 have to be very good to go build customer basis 0:22:44.720 --> 0:22:46.760 audiences get them to spend that money. But in our 0:22:46.760 --> 0:22:50.119 current environment, when there's more of a fixed wallet world 0:22:50.160 --> 0:22:52.880 that we're in, it's the companies that actually pay more 0:22:52.960 --> 0:22:57.199 attention to their customers and create a relationship with those customers, right, 0:22:57.200 --> 0:23:00.600 they're tending to win the hearts, minds, and all of 0:23:00.600 --> 0:23:02.840 those customers. And we had a you know, in the report, 0:23:02.880 --> 0:23:06.720 there was a survey of many, many, many companies, and 0:23:06.760 --> 0:23:08.960 what we found is that the companies that invested most 0:23:09.000 --> 0:23:12.520 in building those digital relationships engaging with those customers in 0:23:12.800 --> 0:23:17.680 targeted and relevant ways. So a ninety percent increase in revenue. Now, 0:23:17.720 --> 0:23:19.920 think about that. In an environment like this, it makes 0:23:19.960 --> 0:23:22.560 sense that the companies that do a really good job 0:23:22.880 --> 0:23:26.560 of using all this very efficient digital technology will understand 0:23:26.560 --> 0:23:29.120 their customers and build a relationship would actually be doing 0:23:29.160 --> 0:23:32.040 better than those that don't. So, Jeff, I'm assuming there 0:23:32.080 --> 0:23:36.400 as a reason that Tuilio carries out this this research, right, 0:23:36.680 --> 0:23:40.040 how do you put into practice your findings, put into 0:23:40.080 --> 0:23:44.160 practice what you preach at Well, what it does is, yeah, 0:23:44.280 --> 0:23:46.639 what it does is it helps companies to understand the 0:23:46.720 --> 0:23:49.400 nature of the ROI of these investments. So I love 0:23:49.480 --> 0:23:54.000 the story of Domino's Pizza. Actually, they have many touches 0:23:54.000 --> 0:23:56.960 with their customers, online, offline, et cetera. As you can imagine, 0:23:57.240 --> 0:24:00.919 they put in a Tuilio segment, the customer data platform, 0:24:00.960 --> 0:24:03.560 the leading customer data platform the market to go understand 0:24:03.560 --> 0:24:05.359 who are these customers? And because of that, they were 0:24:05.400 --> 0:24:09.280