WEBVTT - Trump Rattles Europe Defense Tech Stocks 0:00:02.520 --> 0:00:12.880 Bloomberg Audio Studios, podcasts, radio news. Bloomberg Tech is alive 0:00:12.920 --> 0:00:16.720 from coast to coast with Caroline Hyde in New York 0:00:17.000 --> 0:00:18.959 and Vla Low in sentrances go. 0:00:23.280 --> 0:00:24.840 This is Bloomberg Tech coming up. 0:00:24.880 --> 0:00:29.760 President Trump seeks quote immediate negotiations on acquiring Greenland for 0:00:29.880 --> 0:00:31.080 national security reasons. 0:00:31.080 --> 0:00:32.560 Will recap his speech. 0:00:32.800 --> 0:00:36.400 In Davos, US Netflix shares, they drop on spending to 0:00:36.479 --> 0:00:39.639 buy Warner Brothers, Discovery and Zipline. 0:00:39.760 --> 0:00:42.800 CEO Keller Clifton joins us to discuss the robotics startups 0:00:42.880 --> 0:00:46.680 do seven point six billion dollar valuation and expansion. 0:00:46.960 --> 0:00:49.839 At first, we return to these public markets, then actually 0:00:50.159 --> 0:00:53.960 bounced back somewhat on the walking back from the edge 0:00:54.080 --> 0:00:56.920 of President Trump, the idea that Greenland will not be 0:00:57.000 --> 0:00:59.920 something that is taken by force. European stocks rally from 0:01:00.480 --> 0:01:02.240 We see in fact the NAZA one hundred now up 0:01:02.280 --> 0:01:05.280 one point four percent as the mood music changes. 0:01:05.319 --> 0:01:06.120 But there are real. 0:01:06.000 --> 0:01:09.319 Details in which industries benefit and which are pulling back 0:01:09.560 --> 0:01:11.880 from this significant speech. Over at Davos, we're looking at 0:01:11.880 --> 0:01:14.400 the S and P five hundred now up a percentage point. 0:01:14.600 --> 0:01:16.759 But really, ed, we have to get to the details 0:01:16.800 --> 0:01:17.320 of that speech. 0:01:17.360 --> 0:01:20.240 We just heard, Yeah, and here to recapital is Bloomberg 0:01:20.280 --> 0:01:23.640 Surveillance co host Amri Horden, who is out in Davos. 0:01:24.120 --> 0:01:28.520 The central feature of the President's speech was Greenland, not 0:01:28.760 --> 0:01:33.600 just ruling out the use of force amh in acquiring Greenland, 0:01:33.640 --> 0:01:36.240 but the commitment to continuing on that path. What do 0:01:36.280 --> 0:01:36.760 we need to know? 0:01:37.760 --> 0:01:39.560 Yeah, the President made it very clear he doesn't want 0:01:39.560 --> 0:01:41.440 to use force, he won't use force, and he talked 0:01:41.440 --> 0:01:44.520 about how he is coming here to have intense negotiations 0:01:44.560 --> 0:01:48.120 for the United States to acquire Greenland once again. So 0:01:48.280 --> 0:01:50.760 coming into this, you know, the Europeans really feeling like 0:01:50.800 --> 0:01:54.000 this was an existential threat. This has really taken up 0:01:54.040 --> 0:01:57.520 all the oxygen in every single meeting room you'll attend 0:01:57.600 --> 0:02:01.120 or dinner on the sidelines of Dava, Switzerland. A lot 0:02:01.120 --> 0:02:05.680 of criticism pointed towards Washington because of the President's rhetoric 0:02:05.800 --> 0:02:09.400 regarding Greenland, but he came here with some thinking maybe 0:02:09.520 --> 0:02:11.600 was just to negotiate, and that's exactly what we did. 0:02:11.720 --> 0:02:13.000 And we've seen the President. 0:02:12.800 --> 0:02:15.760 Use this tactic before in the past. In the first term, 0:02:15.800 --> 0:02:18.200 there was so many leaks about maybe the United States 0:02:18.200 --> 0:02:19.480 would leave the NATO alliance. 0:02:19.520 --> 0:02:21.040 At the end of the day, NATO. 0:02:20.880 --> 0:02:23.560 Came to the position the President always wanted it to, 0:02:23.600 --> 0:02:26.919 which is to spend more in collective defense. Another time 0:02:27.000 --> 0:02:30.360 this happened, of course, was more recently last year during 0:02:30.400 --> 0:02:31.120 Liberation Day. 0:02:31.200 --> 0:02:31.639 This is what the. 0:02:31.560 --> 0:02:34.640 Treasury Secretary spoke about earlier in the week here at Davos. 0:02:34.680 --> 0:02:37.399 He said, the hysteria around this is like Liberation Day. 0:02:37.800 --> 0:02:40.480 Everyone needs to take a step back, take a deep breath. 0:02:41.240 --> 0:02:42.520 That was what it feels like. 0:02:42.639 --> 0:02:42.880 Now. 0:02:42.919 --> 0:02:47.880 The President anchored this debate negotiation dialogue, what you may 0:02:47.919 --> 0:02:50.640 want to call it, to the extreme and is now 0:02:50.680 --> 0:02:53.000 here for some sort of potential negotiation. 0:02:53.840 --> 0:02:55.520 Of course, we need to see how this goes. 0:02:55.560 --> 0:02:58.480 The President did say he will be having bilateral meetings 0:02:58.639 --> 0:03:02.480 with European LEO, so we'll see what comes of this. 0:03:02.600 --> 0:03:04.959 But it does seem to be like this has taken 0:03:05.000 --> 0:03:07.360 the tone of the rhetoric down a notch. 0:03:07.840 --> 0:03:12.160 And yet he chastised European leaders, particularly around energy and 0:03:12.160 --> 0:03:15.680 we think here on the Technology show about the nuclear commitment. 0:03:15.760 --> 0:03:17.840 That was something he talked told of nuclear stocks react. 0:03:17.919 --> 0:03:19.600 We also hear a lot about the Golden Zone. What 0:03:19.680 --> 0:03:22.079 took your attention, Imrie, Yeah, the. 0:03:22.040 --> 0:03:26.280 Golden Dome has been linked with this administration to Greenland. 0:03:26.360 --> 0:03:28.959 They also spoke about the fact that Canada wants to 0:03:29.040 --> 0:03:30.960 be a part of this Golden Dome. This would be 0:03:31.200 --> 0:03:34.960 able to shield ballistic or cruise missiles into the United 0:03:35.000 --> 0:03:37.960 States before launch or drawing launch, and be able to 0:03:38.000 --> 0:03:41.280 defend the United States Canada and they think Greenland is 0:03:41.320 --> 0:03:43.640 important for this, and that has been one of the 0:03:43.680 --> 0:03:46.160 issues they have been pushing the President's talking about the fact 0:03:46.120 --> 0:03:49.520 that Greenland is just important in general for national security 0:03:49.560 --> 0:03:52.800 when it comes to Russia and China. On that front, 0:03:52.840 --> 0:03:55.360 the President did say he also will be sitting down 0:03:55.400 --> 0:03:59.920 with President Zelenski. I spoke earlier with his special voice 0:04:00.000 --> 0:04:02.800 Steve Wikoff, who said he was going to Moscow tomorrow 0:04:02.840 --> 0:04:06.800 to meet with President Putin and alongside Jared Kushner, and 0:04:06.840 --> 0:04:10.880 then also he'll be having another meeting with Ukrainians this evening, 0:04:11.120 --> 0:04:14.000 So potentially we also are getting closer to some sort 0:04:14.000 --> 0:04:16.520 of peace agreement when it comes to Ukraine, and that 0:04:16.640 --> 0:04:20.040 is critically important for the Europeans. And I bring this 0:04:20.160 --> 0:04:22.760 up because the Europeans felt like Greenland has just been 0:04:23.000 --> 0:04:26.000 besides an existential threat to them, a distraction for some 0:04:26.040 --> 0:04:29.239 of those really important negotiations taking place regarding the future 0:04:29.279 --> 0:04:29.960 of Ukraine. 0:04:30.160 --> 0:04:33.560 Lu Mexamory Hodden long Day's davors, we so appreciate it. 0:04:33.600 --> 0:04:34.000 Thank you. 0:04:34.640 --> 0:04:37.840 Now, let's return to tech and the earnings release of Netflix. 0:04:38.160 --> 0:04:40.760 You'll see that shares they're sliding. They're down by the 0:04:40.760 --> 0:04:42.719 most in the month. At the moment, the company delivering 0:04:42.800 --> 0:04:45.760 and disappointing profit forecast for the current quarter, and that's 0:04:45.800 --> 0:04:48.640 a spending is mounting. Let's get more of Luemgs Entertainment 0:04:48.720 --> 0:04:51.520 editor Felix Chillette, and look, the seventy six cents a 0:04:51.600 --> 0:04:54.960 share for the fiscal quarter we're currently in that forecast 0:04:55.400 --> 0:04:58.400 is below expectations. But it's Warner Brothers, Discovery and it's 0:04:58.440 --> 0:04:59.479 programming they spend on. 0:05:00.720 --> 0:05:03.479 Yeah, I mean, I think investors have every reason to 0:05:03.520 --> 0:05:05.680 be concerned about spending at this point. I mean, it's 0:05:05.720 --> 0:05:09.200 not just that Netflix is pursuing the biggest acquisition in 0:05:09.240 --> 0:05:13.200 the company's history, but they're also said yesterday that they're 0:05:13.240 --> 0:05:15.880 going to be spending more in twenty twenty six than 0:05:15.880 --> 0:05:18.839 they did in twenty twenty five on programming, whether it's 0:05:18.880 --> 0:05:22.880 TV series or movies. They spent about eighteen billion dollars 0:05:22.960 --> 0:05:24.679 last year. They're going to be up to about twenty 0:05:24.720 --> 0:05:28.279 billion dollars this year. And yeah, they have a lot 0:05:28.320 --> 0:05:31.000 going on, whether it's you know, live sports that they're 0:05:31.160 --> 0:05:34.480 continuing to expand in. They've got this whole podcasting thing 0:05:34.560 --> 0:05:36.600 they want to do. They've been talking for a long 0:05:36.640 --> 0:05:39.120 time about trying to ramp up their video game efforts. 0:05:39.720 --> 0:05:41.880 So yeah, spending is a concern moving forward. 0:05:42.839 --> 0:05:43.279 Felix. 0:05:43.320 --> 0:05:45.720 You'd think that the Warner Brothers Discovery deal would be 0:05:45.760 --> 0:05:48.000 the b or and end all of that earning school. 0:05:48.040 --> 0:05:52.080 But what executives were talking about with these attractive investment opportunities, 0:05:52.440 --> 0:05:55.960 we seem to suggest buying properties, you know, catalog. They've 0:05:56.000 --> 0:05:58.719 looked at Sony for example, for movie rights. Did we 0:05:58.800 --> 0:06:00.920 learn any more about how great sid Netflix is going 0:06:01.000 --> 0:06:02.719 to be in acquiring more ip. 0:06:03.920 --> 0:06:06.080 I mean, what we learned is they see the competition 0:06:06.160 --> 0:06:10.400 as being incredibly fierce out there, you know, talking about YouTube, 0:06:10.760 --> 0:06:15.920 talking about competition from you know, other places like Instagram, TikTok, 0:06:16.240 --> 0:06:23.240 and I think from Netflix's perspective, they can't have enough library, franchises, content. 0:06:23.960 --> 0:06:27.680 They're really become this all service for all different people 0:06:27.760 --> 0:06:30.480 in the family and to do that you know, you 0:06:30.640 --> 0:06:32.520 kind of work on sports, you got to work on 0:06:32.560 --> 0:06:36.640 topical program and you have to have dramas, comedies, boxing, 0:06:36.760 --> 0:06:38.919 So they're really advanced in all fronts. And yeah, I 0:06:38.920 --> 0:06:41.320 think they, you know, are kicking the tires on every 0:06:41.360 --> 0:06:43.719 library as it comes up. I think what they said 0:06:44.160 --> 0:06:47.360 is that, you know, with Warner Brothers Discovery, once they 0:06:47.400 --> 0:06:49.240 looked under the hood a little bit, they really liked 0:06:49.279 --> 0:06:51.280 what they saw and that's when they decided to move 0:06:51.279 --> 0:06:52.120 forward aggressively. 0:06:52.960 --> 0:06:56.000 And it rather serves Netflix to be talking about competition 0:06:56.040 --> 0:06:59.200 in those fields. Particularly they want to get regulatory approval 0:06:59.440 --> 0:07:00.560 for the deal with. 0:07:00.520 --> 0:07:01.040 One of others. 0:07:01.040 --> 0:07:03.679 Discovery just remind us where we are on that deal, Felix, 0:07:03.680 --> 0:07:06.680 because because the twenty first of January was going to 0:07:06.680 --> 0:07:07.279 be a key date. 0:07:08.279 --> 0:07:11.680 Yeah, I mean, so Netflix came back yesterday, they had 0:07:12.000 --> 0:07:15.880 they amended their offer slightly. It's now an all cash offer. 0:07:15.920 --> 0:07:20.160 Before it was cash and stock, and so yeah, they're 0:07:20.200 --> 0:07:22.720 moving forward. They'll put it in front of Warner brother 0:07:22.880 --> 0:07:27.840 Discovery investors sometime in the spring before the annual meeting. 0:07:28.120 --> 0:07:31.520 At the same time, Paramount hasn't completely gone away. You 0:07:31.520 --> 0:07:34.240 have David Ellison still breathing down the neck with this 0:07:35.040 --> 0:07:39.320 tender offer, you know, still trying to keep them in play. 0:07:39.480 --> 0:07:42.080 I think Paramount everyone's waiting to see if they'll raise 0:07:42.120 --> 0:07:45.440 their offer. In the meantime, Paramount seems to be saying, oh, well, 0:07:45.520 --> 0:07:48.680 you know, Netflix is going to have all these regulatory issues. 0:07:49.000 --> 0:07:52.680 To your point, that's why, you know, Netflix has had 0:07:52.720 --> 0:07:55.360 this talking point about, oh, we don't just compete with 0:07:55.480 --> 0:07:58.200 other streamers, we compete with all these tech companies and 0:07:58.280 --> 0:08:02.520 social media, all these other broader competition field. So that's 0:08:02.560 --> 0:08:04.920 been one of other big talking points. And also of 0:08:04.960 --> 0:08:08.840 course that you know they believe suddenly in theatrical releases 0:08:08.880 --> 0:08:11.440 of movies and that they'll plan to continue to put 0:08:11.520 --> 0:08:15.400 Warner Brothers Discovery movies in theaters for the forty five 0:08:15.480 --> 0:08:16.800 day window as they are now. 0:08:17.680 --> 0:08:20.560 Bloomberg's Felix chouette with the Netflix breakdown, thank you very much. 0:08:20.600 --> 0:08:21.880 Let's stick with Netflix earnings. 0:08:21.920 --> 0:08:24.840 Helen and Wang, research analyst at Philip Security, says the 0:08:24.880 --> 0:08:28.040 company is quote in an ideal position and has an 0:08:28.040 --> 0:08:31.320 accumulate call on the stock. She joins us, Now, Helena, 0:08:31.440 --> 0:08:33.960 why then is Netflix in an ideal position? What are 0:08:34.000 --> 0:08:36.520 the data points that you point us to from that 0:08:36.720 --> 0:08:38.280 earnings call and earnings print. 0:08:40.200 --> 0:08:41.480 Hello, thank you for having me. 0:08:41.679 --> 0:08:45.040 I guess to sort off just diving straight into their financials. 0:08:45.360 --> 0:08:48.120 They have very strong financials, so they do have a 0:08:48.160 --> 0:08:50.680 bet on both the top and bottom line, as that 0:08:50.800 --> 0:08:52.920 is not just for the FOS quarter, it is also 0:08:52.960 --> 0:08:56.400 for the entire year. So overall numbers look very solid 0:08:56.720 --> 0:08:59.760 and that is the actual organic volume coming, so people 0:08:59.800 --> 0:09:02.400 are actually engaging in paying for the services. 0:09:03.280 --> 0:09:05.600 Helena like like, oh, and list, you're trying to model 0:09:05.600 --> 0:09:07.520 for what happens next, and you put things in the 0:09:07.559 --> 0:09:11.800 pro column and the con column. Where does this situation 0:09:11.960 --> 0:09:14.400 with Warner Brothers Discovery fit into which column? 0:09:16.040 --> 0:09:20.000 Well, I guess it really depends because for Netflix right now, 0:09:20.080 --> 0:09:23.200 they're clearly in the leader position in the streaming business. 0:09:23.440 --> 0:09:26.320 So even compared to their closest Robbery Disney, they have 0:09:26.360 --> 0:09:29.440 a much bigger membership base and they stop recording the numbers. 0:09:29.440 --> 0:09:31.960 But they did disclose in this earning that their membership 0:09:32.000 --> 0:09:35.080 is three hundred and twenty five million, so that and 0:09:35.280 --> 0:09:38.480 their money tize is business almost twice as better. And 0:09:38.720 --> 0:09:41.199 with less than ten percent of the total TV viewing, 0:09:41.240 --> 0:09:44.360 there's still a huge wrong way for gross So this 0:09:44.520 --> 0:09:48.400 wonder brother Vial, it really comes in. So the question 0:09:48.480 --> 0:09:51.200 for twenty twenty six is no longer whether they're going 0:09:51.240 --> 0:09:54.800 to be able to continue their gross profitably, which they 0:09:54.880 --> 0:09:57.560 have been doing so that's almost one hundred percent. So 0:09:57.600 --> 0:10:00.040 the question really coming in whether they're going to be 0:10:00.080 --> 0:10:06.520 able to integrate such a big company without sacrificing in 0:10:06.640 --> 0:10:08.400 their margins. 0:10:08.600 --> 0:10:10.160 So that is the question that's coming in. 0:10:10.559 --> 0:10:12.840 Yeah, and for this fiscal culture, it looks like margins 0:10:12.840 --> 0:10:15.880 can't under pressure, so do stop buybacks? But they said, 0:10:15.880 --> 0:10:20.199 look in the longer term, they're committed to margin increase. Helena, 0:10:20.520 --> 0:10:23.040 I'm looking at at the stock that's the lower since 0:10:23.120 --> 0:10:27.040 January of last year. How confident are you and the 0:10:27.080 --> 0:10:30.040 investor base that they can not get distracted during the 0:10:30.160 --> 0:10:32.520 m and A process and indeed interweave it well if 0:10:32.520 --> 0:10:34.959 they managed to clinch it well. 0:10:35.000 --> 0:10:37.720 Their operating margin guide seems to be a little bit 0:10:37.760 --> 0:10:40.040 of life for the next quarter. They've guided thirty one 0:10:40.080 --> 0:10:43.000 percent while the consensus was thirty two to thirty three percent. 0:10:43.360 --> 0:10:45.800 So there is a question of whether we will be 0:10:45.840 --> 0:10:47.880 expecting its operating expense. 0:10:47.600 --> 0:10:48.360 To expand further. 0:10:49.520 --> 0:10:53.400 But I guess what my view is they might want 0:10:53.440 --> 0:10:55.720 a guide more conservatively at the start of the year, 0:10:55.960 --> 0:10:58.160 given all the uncertainty of the water brother, do you 0:10:58.800 --> 0:11:01.839 they're leaving more scope to outperform expectation as the year 0:11:01.840 --> 0:11:02.400 of progresses. 0:11:02.640 --> 0:11:04.360 So I do believe there is a little bit of 0:11:04.360 --> 0:11:07.040 a wiggle room in terms of margin for years to come. 0:11:07.280 --> 0:11:09.679 I mean, and let's just just haven't liked the idea 0:11:09.720 --> 0:11:12.679 of them making this purchase. Really, since the minute they 0:11:12.679 --> 0:11:14.360 put their hand in the ring, shares are off by 0:11:14.360 --> 0:11:15.360 about thirty percent. 0:11:16.400 --> 0:11:18.360 Should they be buying this asset? 0:11:18.520 --> 0:11:22.520 How integral is it that they buy this storied Hollywood asset? 0:11:23.760 --> 0:11:26.079 Well, okay, I would like to point out that financially 0:11:26.080 --> 0:11:29.360 they're very strong, so they don't necessarily need a merger 0:11:29.400 --> 0:11:32.440 to survive. So it's not necessarily a lifeline for them. 0:11:32.520 --> 0:11:34.600 So from the Netflix point of view, it's more of 0:11:34.640 --> 0:11:37.840 a power move for them to aiming at total dominance. 0:11:38.120 --> 0:11:40.400 So our power moves sort of needs to come as 0:11:40.400 --> 0:11:42.640 a sacrifice. So the fact that they are making the 0:11:42.679 --> 0:11:45.959 decision to expose themselves with such risk means they are 0:11:46.040 --> 0:11:48.800 confident enough with their girls, with their financials to make 0:11:48.880 --> 0:11:49.840 such bold decisions. 0:11:51.000 --> 0:11:54.320 Helena, for the last few years, several years Caroline and 0:11:54.320 --> 0:11:57.600 I have been told constantly that in this streaming race, 0:11:58.040 --> 0:12:03.520 content is king Netflix not getting more support, particularly in 0:12:03.520 --> 0:12:06.760 the stock for just going out there and being aggressive 0:12:06.880 --> 0:12:09.320 to keep the library growing having more content. 0:12:11.400 --> 0:12:13.760 Well, I guess right now, because they already don't have 0:12:13.800 --> 0:12:15.920 a competitor in terms of the streaming business. 0:12:16.200 --> 0:12:18.400 They already have a very strong content slate. 0:12:19.160 --> 0:12:21.440 The twenty twenty five we got all the Sweet Game, 0:12:21.480 --> 0:12:24.880 Stranger things Wednesday, so all these are very very popular, 0:12:25.120 --> 0:12:28.160 and twenty twenty six lineup is also very strong. So 0:12:28.200 --> 0:12:31.600 they have this incredible ability to have the amazing content 0:12:31.640 --> 0:12:34.600 with more to come, and still have very impressive traditional 0:12:34.600 --> 0:12:37.480 financial metrics. And if you realize their bottom line Girls 0:12:37.559 --> 0:12:39.559 is much higher than the top line Girls, this is 0:12:39.600 --> 0:12:43.160 because their business itself is a very mature efficiency machine, 0:12:43.320 --> 0:12:45.320 because if you think about it, their costs for making 0:12:45.320 --> 0:12:48.200 the content available is somewhat fixed. We get two billion 0:12:48.240 --> 0:12:50.760 people p two million people watching or two hundred million 0:12:50.800 --> 0:12:53.800 people watching it, so the more engagement they get, every 0:12:53.920 --> 0:12:56.360 new dollar that comes in flow almost straight to the 0:12:56.360 --> 0:12:58.640 bottom line. So this is why they already have very 0:12:58.679 --> 0:13:02.880 outstanding profitability, so they can afford to expand more aggressively 0:13:03.280 --> 0:13:05.480 into a bigger total dominance. 0:13:06.559 --> 0:13:10.199 Herne, which piece of this Warner Brothers Discovery proposed transaction 0:13:10.320 --> 0:13:14.360 interests you more the studios or taking HBO Max and 0:13:14.400 --> 0:13:17.079 doing something with it, Well. 0:13:16.840 --> 0:13:19.120 I think it would still be the HBO Max because 0:13:19.240 --> 0:13:22.720 HBO Max right now is still considered the fourth biggest 0:13:22.720 --> 0:13:26.880 streaming company. So with HBO Max together adding up together, 0:13:26.920 --> 0:13:29.480 they will essentially have more than four hundred and fifteen 0:13:29.520 --> 0:13:33.280 billion of subscribers, so that is more than almost more 0:13:33.320 --> 0:13:36.000 than half of the streaming industry. So that would definitely 0:13:36.040 --> 0:13:38.800 give them entire monopoly in that field. 0:13:39.360 --> 0:13:42.280 But Helena, I look at mister Beast who has more 0:13:42.280 --> 0:13:45.800 than four hundred and fifty million subscribers on his YouTube 0:13:45.880 --> 0:13:49.240 platform alone, let alone the dominant force of YouTube. So 0:13:49.480 --> 0:13:53.040 how do you see the market and who their competitors are. 0:13:54.120 --> 0:13:56.800 Well, I guess that is exactly exactly why they wanted 0:13:56.840 --> 0:14:00.000 to expland more to the field because they've already reached 0:14:00.360 --> 0:14:03.680 almost a monopoly leader position in the streaming business, so 0:14:03.720 --> 0:14:07.240 they're looking to expand into something else because the entertainment 0:14:07.240 --> 0:14:10.160 industry is always forever changing, so they're always trying to 0:14:10.200 --> 0:14:12.360 make sure that they have a foot in the ring 0:14:12.760 --> 0:14:14.120 before the environment. 0:14:13.760 --> 0:14:17.800 Changes, Helen and Wang of Philip Security staying up late 0:14:17.840 --> 0:14:20.720 for us in Asia. We so appreciate you having time 0:14:20.760 --> 0:14:21.480 for us on the show. 0:14:21.600 --> 0:14:24.600 Thank you. Now, let's turn attention to Invidia's Jensen Wang. 0:14:24.720 --> 0:14:26.800 He plans to travel to China as he works to 0:14:26.840 --> 0:14:29.520 reopen a crucial market for his company's AI chips. 0:14:29.840 --> 0:14:31.320 From that next, this is Blueberg Tech. 0:14:44.800 --> 0:14:46.640 We're going to be listening now a little bit more 0:14:46.680 --> 0:14:49.720 to what's been being said across in Davos. 0:14:49.720 --> 0:14:50.960 In particular, we've. 0:14:50.840 --> 0:14:53.480 Been hearing from the CEO of Invidia, Jensen Wang, who 0:14:53.520 --> 0:14:56.720 is being interviewed by Larry Fink himself, talking about the 0:14:56.800 --> 0:15:01.640 trillion dollar opportunity that continues and indeed where we might 0:15:01.720 --> 0:15:05.000 indeed see job losses or not. Let's get out to 0:15:05.080 --> 0:15:08.360 Bluemberg's Ian King, who covers all things semiconductors right now, 0:15:08.440 --> 0:15:11.680 and Ian, let's talk a little bit about what's been 0:15:11.960 --> 0:15:15.440 happening in terms of Jensen and where he sees the 0:15:15.480 --> 0:15:19.120 opportunity and scale needed for AI. You've been saying more 0:15:19.120 --> 0:15:21.560 broadly that well, this is a no brainer, and that 0:15:21.600 --> 0:15:22.880 he's been saying this time and time again. 0:15:23.960 --> 0:15:28.080 Yeah, I mean he's traveling around the world preaching basically 0:15:28.080 --> 0:15:30.480 to whichever audience he can get in front of and 0:15:30.600 --> 0:15:33.160 trying to convey the message. I mean kind of last 0:15:33.240 --> 0:15:37.280 night for us time, as message was, look, hey, AI 0:15:37.360 --> 0:15:40.200 is going to change the economy. But listen, Europeans, you 0:15:40.200 --> 0:15:43.240 don't need to worry about regulating AI too much because 0:15:43.280 --> 0:15:46.360 it's actually going to help create certain jobs and make 0:15:46.440 --> 0:15:49.800 certain jobs stronger. And again he's delivering a very nuanced message. 0:15:49.880 --> 0:15:52.840 But everything is designed to ease the passage of AI. 0:15:53.120 --> 0:15:56.080 I think it's really important to point out despite the 0:15:56.120 --> 0:15:58.560 news headlines and Arscle's written, none of this is new, 0:16:00.000 --> 0:16:03.080 picularly the point that the investment in AI infrastructure will 0:16:03.080 --> 0:16:08.640 generate skilled labour jobs plumbing electricians for example. Also, there 0:16:08.680 --> 0:16:11.280 were no questions put to him in an extended on 0:16:11.320 --> 0:16:16.320 stage conversation about China. But Bloomberg's reporting citing sources that 0:16:16.400 --> 0:16:19.120 he will go to China. That is in and of 0:16:19.160 --> 0:16:21.000 itself quite a normal thing for him to do. But 0:16:21.040 --> 0:16:22.200 what do we need to know about that? 0:16:22.360 --> 0:16:24.600 Yeah, I mean always at this time of year, as 0:16:24.600 --> 0:16:28.200 you know, we have, you know, the Chinese New Year, 0:16:28.560 --> 0:16:30.160 and he'd likes to go to Taiwan. He likes to 0:16:30.200 --> 0:16:34.520 go to Beijing, to sort of look after his employees there. 0:16:34.800 --> 0:16:38.000 They have parties and things like that. Previously, when he's 0:16:38.120 --> 0:16:41.480 visiting China he has managed to have meetings with senior officials. 0:16:41.480 --> 0:16:43.240 We don't know whether he's going to do that this time, 0:16:43.640 --> 0:16:46.160 but obviously if he could, then it's really important to 0:16:46.160 --> 0:16:49.240 get Beijing to sign off on H two Just. 0:16:49.200 --> 0:16:51.720 One quick introduction team, which I apologize for. Remember that 0:16:51.760 --> 0:16:53.920 he only told me two weeks ago. We don't speak 0:16:53.960 --> 0:16:57.120 directly to the Chinese government. Our communication is through the companies. 0:16:57.320 --> 0:16:58.800 But sorry, carry on in. 0:16:59.040 --> 0:17:02.000 Yeah, whether he does directly or whether he does it 0:17:02.040 --> 0:17:06.080 through intermediaries. Getting sign off on those H two hundred ships, 0:17:06.080 --> 0:17:08.439 which the US government has said, hey, it's okay to 0:17:08.480 --> 0:17:10.960 an extent to send them to China. Getting China to 0:17:11.000 --> 0:17:12.960 accept them is going to be key, and that'll be 0:17:13.000 --> 0:17:15.760 something that you know, our audience will focus on heavily. 0:17:16.200 --> 0:17:17.240 And of course, all. 0:17:17.040 --> 0:17:19.120 Of this access to China is something he's been talking 0:17:19.119 --> 0:17:21.520 about as a total total addressable market of at least 0:17:21.600 --> 0:17:24.840 fifty billion in this fiscal year alone. I just want 0:17:24.840 --> 0:17:27.080 to go back to what he said at Dabos yesterday 0:17:27.080 --> 0:17:30.439 when being in discussion whether we call it an interview 0:17:30.440 --> 0:17:33.240 with Larry Fink. China wasn't on the agenda, but certainly 0:17:33.240 --> 0:17:34.159 the size of the market was. 0:17:34.200 --> 0:17:34.879 Just take a listener. 0:17:36.119 --> 0:17:40.119 This is the largest infrastructure built out in human history 0:17:40.840 --> 0:17:43.320 that's going to create a lot of jobs. And it's 0:17:43.400 --> 0:17:50.320 wonderful that the jobs are related to tradecraft. And we're 0:17:50.359 --> 0:17:54.320 going to have plumbers and electricians and construction and steel 0:17:54.359 --> 0:18:02.239 workers and network technicians and peopleeople who are installed and 0:18:02.280 --> 0:18:06.040 fit out the equipment and now all of these jobs 0:18:07.119 --> 0:18:11.080 in the United States. We're seeing quite a significant boom 0:18:11.160 --> 0:18:15.400 in this area as salaries have gone up are nearly doubled. Yeah, 0:18:15.960 --> 0:18:20.359 and so we're talking about six figure salaries for people 0:18:20.400 --> 0:18:24.280 who are building chip factories or computer factories. 0:18:25.880 --> 0:18:28.960 We've heard Paneteer CEO Alex Karp talking about the death 0:18:29.000 --> 0:18:33.640 of humanities, but the study of vocations in how long 0:18:33.680 --> 0:18:35.440 do those sorts of jobs last. You're a man who 0:18:35.480 --> 0:18:38.240 knows significantly what the data said to build out looks 0:18:38.280 --> 0:18:40.080 like many would say electricians were they going to be 0:18:40.119 --> 0:18:40.639 in the short time? 0:18:40.720 --> 0:18:44.639 Any Yeah, I mean it really depends that this is 0:18:44.680 --> 0:18:47.280 all about focus. If you're Jensen Wang, you want the 0:18:47.320 --> 0:18:51.399 focus on the economic benefits of AI. You want everybody 0:18:51.640 --> 0:18:54.440 thinking about how this is going to propel the economy 0:18:54.480 --> 0:18:57.960 forward and help everybody. You don't want people thinking about 0:18:58.040 --> 0:19:00.639 questions like the one you just gave me, and also 0:19:00.680 --> 0:19:04.680 about the amount of jobs that maybe go away because 0:19:04.720 --> 0:19:07.040 of AI. So this is a this is like a hey, 0:19:07.119 --> 0:19:09.760 look over here type of directional kind of assertion that 0:19:09.800 --> 0:19:12.600 he wants to make. And for the foreseeable future, we 0:19:12.680 --> 0:19:15.960 are going to continue to see these massive buildouts. 0:19:15.760 --> 0:19:18.679 Thanking across all things in Nvidia. As always for us, 0:19:18.720 --> 0:19:25.959 we appreciate it Meta well. 0:19:26.000 --> 0:19:28.560 It says it's looking to boost its online safety features 0:19:28.600 --> 0:19:32.000 as Europe weighs tougher rules and the possibility of restrictions 0:19:32.000 --> 0:19:35.480 on social media platforms for young adults. Remerg's Frasie Laua 0:19:35.600 --> 0:19:38.640 sat down with Nicola Mendelssohn, who leads Metas Global Business Group, 0:19:38.880 --> 0:19:41.399 to talk about new teen accounts designed to give parents 0:19:41.440 --> 0:19:41.959 more control. 0:19:42.000 --> 0:19:42.520 Take a listen. 0:19:45.000 --> 0:19:48.040 Keeping young people on safe on our platform is incredibly 0:19:48.040 --> 0:19:50.760 important to us. It's an absolute priority, and we've been 0:19:50.760 --> 0:19:53.000 investing in this area for a number of years. 0:19:53.320 --> 0:19:53.960 It's why we. 0:19:53.960 --> 0:19:57.240 Launch teen accounts back in twenty twenty four to keep 0:19:57.280 --> 0:20:00.879 young people safe, to give parents, supervisionary come trolls so 0:20:00.960 --> 0:20:03.680 that they can also work with their children. They're young 0:20:03.720 --> 0:20:05.600 people in terms of keeping them safe. 0:20:05.640 --> 0:20:06.400 So what does that mean. 0:20:06.640 --> 0:20:08.879 It means restricting the amount of time that they spend 0:20:08.880 --> 0:20:09.760 on the platform. 0:20:10.040 --> 0:20:12.200 It means that they can restrict. 0:20:11.960 --> 0:20:13.560 Who comes in and we place them all in that 0:20:14.200 --> 0:20:17.040 category automatically. So this is very important. But of course 0:20:17.040 --> 0:20:18.920 we're going to work with regulators wherever they are. 0:20:19.280 --> 0:20:20.480 Do you think the band will come through? 0:20:20.800 --> 0:20:22.960 I'm not going to speculate. I'm not going to speculate 0:20:23.000 --> 0:20:24.920 with you on that. So first off, we use AI 0:20:25.400 --> 0:20:27.960 when it comes to people on our platform to see 0:20:27.960 --> 0:20:29.600 more of the things that they want to see. So 0:20:29.720 --> 0:20:32.760 we have growth across all of our different platforms, which 0:20:32.800 --> 0:20:34.040 is fantastic to see. 0:20:34.200 --> 0:20:35.480 Then we have the advantage suite. 0:20:35.600 --> 0:20:38.720 It's very simple. I mean some of the practices that 0:20:38.800 --> 0:20:41.520 you used to talk one hundred and fifty different steps, 0:20:41.720 --> 0:20:43.720 now you can do it in one step. We also 0:20:43.760 --> 0:20:46.479 see more and more the increase in our generative AI tools, 0:20:46.680 --> 0:20:50.399 how they can use it for text, for translations, for 0:20:50.680 --> 0:20:53.560 even the creation for video. Now we have over two 0:20:53.640 --> 0:20:57.000 million advertisers doing that. So all these things are combining 0:20:57.040 --> 0:21:01.000 alongside both reels as well to really give growth for 0:21:01.080 --> 0:21:02.080 our advertising. 0:21:02.160 --> 0:21:04.120 Nigga, what do you think is still untapped in your mind? 0:21:04.320 --> 0:21:04.439 Oh? 0:21:04.560 --> 0:21:05.280 So many things. 0:21:05.280 --> 0:21:07.280 I mean, that's how I've got our whole Smager's board 0:21:07.280 --> 0:21:11.359 of things. So definitely messaging, we're seeing a continuous uptake 0:21:11.400 --> 0:21:16.160 in more personalized communication between businesses and people. There's now 0:21:16.200 --> 0:21:19.760 over a billion messages sent every day between people and businesses. 0:21:20.160 --> 0:21:22.720 We see eight percent of people around the world globally 0:21:22.760 --> 0:21:25.600 that are speaking with a business every single week. So 0:21:25.720 --> 0:21:28.080 this is an area both on the marketing side, but 0:21:28.200 --> 0:21:31.240 increasingly more on the utility and the authentication side. 0:21:31.400 --> 0:21:32.880 A good example is Air France. 0:21:33.240 --> 0:21:35.840 So Airfront's when they switched this on within a few days, 0:21:36.080 --> 0:21:39.200 it became their primary source of communicating with their customers, 0:21:39.480 --> 0:21:41.879 and they're doing it to deliver boarding passes, tell you 0:21:41.920 --> 0:21:44.919 about where your baggage is also remarketing as well. So 0:21:45.200 --> 0:21:47.719 that's a very good example of some of the changes 0:21:47.720 --> 0:21:48.280 that we're seeing. 0:21:49.760 --> 0:21:52.679 That was mesi's head of Global Business, Nicola Mendelssohn speaking 0:21:52.680 --> 0:21:56.400 with Bloomberg's Francine Lacroix. Let's get back to Bloomberg Surveillance 0:21:56.440 --> 0:21:59.879 co host Emory Horden who's standing by in Davos Emrie. 0:22:00.880 --> 0:22:01.679 Thanks so much, Ed. 0:22:01.720 --> 0:22:04.680 I'm now joined by the Dutch Prime Minister Shuff, an 0:22:04.720 --> 0:22:06.879 individual who's really at the center of what's going on 0:22:06.960 --> 0:22:09.159 with Greenland as well as someone is really important to 0:22:09.280 --> 0:22:11.800 United States when it comes to national security. Regarding China, 0:22:12.000 --> 0:22:13.679 I want to start with the President's speech. Though you 0:22:13.680 --> 0:22:17.760 were one of those countries listed potentially more tariffs, the 0:22:17.800 --> 0:22:21.040 President said he's here for earnest negotiations. What did you 0:22:21.080 --> 0:22:23.080 make of his speech? Are you feeling more relaxed. 0:22:23.520 --> 0:22:25.920 Well, I think it's good that he use the word negotiations, 0:22:25.960 --> 0:22:30.080 and I think we shared the common interest of security 0:22:30.119 --> 0:22:32.399 of the Arctic, and I think we should work it 0:22:32.400 --> 0:22:35.640 out in NATO and then make sure that's a security 0:22:35.720 --> 0:22:37.760 from the national security of the United States Canada and 0:22:37.800 --> 0:22:39.320 you will benefit from it. 0:22:39.440 --> 0:22:41.639 The President also used the words I don't want to 0:22:41.720 --> 0:22:42.240 use force. 0:22:42.480 --> 0:22:43.560 I won't use force. 0:22:44.000 --> 0:22:47.720 So when you say you're looking forward to the security 0:22:47.760 --> 0:22:51.000 of the Arctic kind of agreement do you think Washington 0:22:51.040 --> 0:22:54.640 can come to with the continental Europe. 0:22:54.320 --> 0:22:57.760 Well, that's difficult to say, but I think American presence 0:22:58.160 --> 0:23:00.240 on we already have a base, and I think we 0:23:00.840 --> 0:23:05.120 could intensify that also with European troops and then we're 0:23:05.280 --> 0:23:07.919 very close together for the security of the Arctic and 0:23:08.040 --> 0:23:10.520 try to prevent influence from Russia and China. 0:23:10.400 --> 0:23:11.000 In the Arctic. 0:23:11.160 --> 0:23:14.280 Do you think this means the trade threat is over 0:23:14.560 --> 0:23:16.160 the higher tariff levels. 0:23:15.920 --> 0:23:18.480 Well, not yet, and I think we have had a 0:23:18.600 --> 0:23:22.480 European Council tomorrow evening, and I think we should step 0:23:22.560 --> 0:23:27.600 up and make make very clear that this is it's unjustified. 0:23:28.840 --> 0:23:32.320 It makes no sense to use straight seriffs to achieve 0:23:32.359 --> 0:23:35.320 security goals, and we have to push back, but in 0:23:35.359 --> 0:23:39.240 the meantime and ready to act from it as European Union. 0:23:39.440 --> 0:23:41.880 But at the same time use the time in between 0:23:42.480 --> 0:23:45.800 for diplomatic efforts because I think we should solve this diplomatically. 0:23:46.000 --> 0:23:49.199 How has Netherlands been involved in that diplomatic outreach to 0:23:49.240 --> 0:23:50.240 the Trump administration. 0:23:50.920 --> 0:23:53.280 Well, we are involved in you and we are involved 0:23:53.280 --> 0:23:56.520 in a lot of ways. And of course the Secretary 0:23:56.600 --> 0:23:59.520 General of the Native is also a Jutchment is. 0:23:59.520 --> 0:23:59.879 On the lea. 0:24:00.400 --> 0:24:01.959 Yeah, yeah, you're aware of that. 0:24:02.200 --> 0:24:03.919 I mean, do you feel like if you text now 0:24:04.080 --> 0:24:06.639 US official that it might become you know, public knowledge? 0:24:06.800 --> 0:24:07.000 Yeah? 0:24:07.040 --> 0:24:10.640 No, I don't think anybody expected that, but anyway it happened. 0:24:11.400 --> 0:24:14.439 But I think we are evolved because we are always 0:24:14.440 --> 0:24:17.480 have a very strong tends Atlantic bond. We have a big, 0:24:17.520 --> 0:24:20.440 thraight relationship with the United States. We consider the United 0:24:20.480 --> 0:24:22.439 States as a big friend of ours. But at the 0:24:22.440 --> 0:24:25.639 same time, I mean, that's not the way we have 0:24:25.720 --> 0:24:28.800 to create a friendship with imputteriffs. 0:24:28.800 --> 0:24:29.760 That's very difficult. 0:24:29.840 --> 0:24:32.240 You are sounding optimistic that there is an off ramp. 0:24:32.440 --> 0:24:34.840 Do you think the European Union should use the anti 0:24:34.880 --> 0:24:35.680 coercion rule? 0:24:36.240 --> 0:24:38.160 Well, we should look into every measure we can take 0:24:38.240 --> 0:24:42.240 if the imput tariffs are being implemented the first of February, 0:24:43.280 --> 0:24:45.080 but at the same time we should try to prevent 0:24:45.119 --> 0:24:49.720 it from happening and find a solution for the Arctic security. 0:24:49.920 --> 0:24:50.720 Right now, you're joining me. 0:24:50.760 --> 0:24:53.520 It's the evening in Davos, but it's very early on 0:24:53.560 --> 0:24:56.040 the West coast the Bloomberg Technology Show, and one company 0:24:56.040 --> 0:24:58.560 they do track is ASM Now it's a huge chip maker, 0:24:58.600 --> 0:25:01.480 it's really a crown jewel of you. You recently met 0:25:01.480 --> 0:25:04.560 with the chief executive officer. What is your sense of 0:25:04.600 --> 0:25:06.679 what is going on in terms of chips to China 0:25:06.760 --> 0:25:10.240 and the national security framework? Because we saw the United 0:25:10.240 --> 0:25:13.240 States has had a lot of almost ups and downs 0:25:13.240 --> 0:25:15.280 in terms of what they will allow go to China 0:25:15.320 --> 0:25:16.280 and what they want. 0:25:16.520 --> 0:25:20.200 I think we should Moorderligne and I think that ASML 0:25:20.640 --> 0:25:24.119 is delifering a lot of machinery for China in the 0:25:24.160 --> 0:25:26.920 lower end chips, and I think that's a good business 0:25:26.960 --> 0:25:29.760 for ASML, and in that way they can really produce 0:25:29.800 --> 0:25:32.280 the top north technology that we need in the West, 0:25:33.080 --> 0:25:35.600 and I think that's also important for the US. So 0:25:35.680 --> 0:25:38.760 I think ASML is a crime rule with the Netlands 0:25:38.800 --> 0:25:41.800 and the all ecosystem around ASML is very important and 0:25:41.840 --> 0:25:42.639 we should cherish. 0:25:42.920 --> 0:25:45.359 What was the assessment you recently met with the CEO, 0:25:45.400 --> 0:25:48.320 I believe this week. What was his assessment on how 0:25:48.480 --> 0:25:52.800 having to really walk this tightrope between Washington and Beijing and. 0:25:52.760 --> 0:25:55.159 Then you have to walk also the titrope with the Netherlands, Right, 0:25:55.200 --> 0:25:57.120 So I'm. 0:25:56.960 --> 0:25:59.440 Guessing that one might be a little bit easier, but maybe. 0:25:59.160 --> 0:26:00.000 Not all partics. 0:26:01.200 --> 0:26:03.880 Yeah, but we have our own arrangement when it comes 0:26:03.920 --> 0:26:06.600 to national security. But I think he knows very well 0:26:06.640 --> 0:26:10.600 that it's not about top notch in technology that's going 0:26:10.640 --> 0:26:14.720 to be shifted to Beijing, not to China, So we 0:26:14.800 --> 0:26:17.239 have to discuss all kinds of issues related that we 0:26:17.280 --> 0:26:21.679 make it possible for ASML to earn money in China 0:26:21.680 --> 0:26:24.520 as well and make sure that they create a top 0:26:24.600 --> 0:26:29.480 notch technology for US, for Europe, for the United States. 0:26:29.720 --> 0:26:32.240 Last year, when you joined Bloomberg, you talked about how 0:26:32.440 --> 0:26:35.040 under the Biden administration there was concerns about national security 0:26:35.080 --> 0:26:36.800 comes to chips to China, and you expected that to 0:26:36.840 --> 0:26:39.520 happen under the Trump administration. But with all this hot 0:26:39.600 --> 0:26:42.880 rhetoric from the Trump administration regarding Greenland, do you think 0:26:42.880 --> 0:26:46.080 that has made it more difficult to align yourself with 0:26:46.200 --> 0:26:49.840 Washington on national security for a key adversary like China. 0:26:50.480 --> 0:26:54.280 Well, I think on China it's maybe more easy because 0:26:54.280 --> 0:26:56.840 we are more aligned and of course we have all 0:26:56.880 --> 0:26:59.760 our trade interests and also the US as a trade interest. 0:27:00.000 --> 0:27:01.800 Well, it's different than. 0:27:01.760 --> 0:27:04.960 From OAD issues. And I really hope that we can 0:27:05.000 --> 0:27:07.760 make arrangement around to Greenland. I really hope that US 0:27:08.080 --> 0:27:10.919 Bill Beck is up in the peace process in Ukraine. 0:27:11.160 --> 0:27:14.120 It was the still going on and at the same 0:27:14.119 --> 0:27:17.679 time we have to take care of national security issues 0:27:17.800 --> 0:27:20.160 related to economy. I mean, it's just what it is 0:27:20.320 --> 0:27:21.200 in the world of today. 0:27:21.320 --> 0:27:23.680 The Prime Minister of Canada, Mark Karney, had a pretty 0:27:23.680 --> 0:27:26.919 spicy speech yesterday, provocative for some individuals. 0:27:26.920 --> 0:27:28.440 The President made a nod to it today. 0:27:28.440 --> 0:27:30.840 He didn't mention Trump by any but many individuals took 0:27:30.880 --> 0:27:32.879 it as he was signaling to what is going on 0:27:32.920 --> 0:27:34.320 in the United States. And he said, if you are 0:27:34.359 --> 0:27:36.600 a country in the middle, if you're not at the table, 0:27:36.840 --> 0:27:37.760 you're going to get eaten. 0:27:37.800 --> 0:27:39.680 And he said the world order we live at now 0:27:39.960 --> 0:27:42.240 is dead. Do you agree with that assessment. 0:27:42.440 --> 0:27:44.960 Well, the world order certainly has changed, and I think 0:27:45.000 --> 0:27:46.280 it's an illusion to think. 0:27:46.119 --> 0:27:49.000 It will come back to the day that I grew up. 0:27:50.280 --> 0:27:52.800 So we have to adapt to the new way in 0:27:53.240 --> 0:27:56.359 which countries I mean in China we got the United 0:27:56.400 --> 0:28:00.440 States have we still got Russias and military power coming entries. 0:28:00.640 --> 0:28:02.919 So we have to a dept as Europe, and I 0:28:02.960 --> 0:28:07.160 think Europe has to get itself stronger economically but also 0:28:07.440 --> 0:28:10.720 on the defense side within NATO, but we have to 0:28:10.760 --> 0:28:13.800 work much more together and make sure that the European 0:28:13.880 --> 0:28:16.679 Union is a real economic union and that Europe is 0:28:16.720 --> 0:28:18.720 really a defense force to reckon with. 0:28:18.800 --> 0:28:21.320 In partments of your life is changing. You're leaving government. 0:28:21.560 --> 0:28:23.520 How is the formation now of the new government. 0:28:24.160 --> 0:28:28.399 Well, it's on track. I expect to be to be 0:28:28.440 --> 0:28:32.600 inaugurated at the end of February, but the negotiations are 0:28:32.640 --> 0:28:33.320 still going on. 0:28:34.080 --> 0:28:35.120 And what are your plans. 0:28:35.280 --> 0:28:41.160 Yeah, well I'm officially already retired. Yeah, yeah, yeah. In 0:28:41.400 --> 0:28:45.200 a few days there will be the ninety six the 0:28:45.320 --> 0:28:47.960 we say it correctly, yeah, of sixty nine. What is 0:28:48.000 --> 0:28:52.280 it six anyway? Yes, you're definitely as much younger sixty nine. Yes, 0:28:53.160 --> 0:28:55.560 But of course I hope to I've worked for a 0:28:55.640 --> 0:28:57.880 very long time as if a servant on all kind 0:28:57.880 --> 0:29:00.960 of key positions in security, so I hope to get 0:29:01.000 --> 0:29:07.640 my experience and my knowledge and to make it failuable. 0:29:07.240 --> 0:29:07.800 For the people. 0:29:07.840 --> 0:29:09.960 And you can come share that with us on Bloomberg TV. 0:29:10.200 --> 0:29:11.880 Oh that's great, Thank you so. 0:29:11.880 --> 0:29:12.480 Much for your time. 0:29:12.560 --> 0:29:13.160 Prime Minister. 0:29:13.760 --> 0:29:16.280 That was the Dutch Prime Minister, Dick schaff There, an 0:29:16.320 --> 0:29:19.200 individual who was really his country's at the epicenter when 0:29:19.240 --> 0:29:21.959 it comes to Greenland. They're one of those countries labeled 0:29:22.000 --> 0:29:24.800 by the Trump administration potentially more tariffs if they don't 0:29:24.800 --> 0:29:28.120 get access to Greenland. The President really tempered that rhetoric though. 0:29:28.120 --> 0:29:30.280 Today had his speech which is giving a little bit 0:29:30.320 --> 0:29:33.240 of life, breathing some life into this story for European 0:29:33.320 --> 0:29:34.200 leaders to. 0:29:34.160 --> 0:29:35.040 Have a sigh of relief. 0:29:35.040 --> 0:29:38.520 But also when it comes to export controls and chips going. 0:29:38.360 --> 0:29:42.000 To Beijing asml key for our audience. Great to have 0:29:42.120 --> 0:29:43.880 you and that interview. Thank you, Amory. 0:29:44.640 --> 0:29:46.800 Let's stick with Dabos coverage salesforce. 0:29:46.800 --> 0:29:47.040 C you. 0:29:47.120 --> 0:29:50.400 Marc Benioff is striking a more cautionately note on AI technology, 0:29:50.600 --> 0:29:54.240 saying reports of teen suicides linked to AI should be 0:29:54.280 --> 0:29:56.480 a wake up call on unregulated AI. 0:29:56.760 --> 0:29:58.800 He spoke with Bluebergsamini Chang. Just take a listen. 0:30:01.600 --> 0:30:03.840 We are dealing with a new kind of very unwieldy 0:30:03.920 --> 0:30:07.920 technology which by left by itself, these large language models, 0:30:07.920 --> 0:30:10.479 they can do all kinds of terrible things. I mean, 0:30:10.560 --> 0:30:12.000 they can do a lot of great things too. You've 0:30:12.080 --> 0:30:14.840 used them, you know. They can summarize things, and you 0:30:14.840 --> 0:30:17.440 can ask them queries and you can get information. But 0:30:17.880 --> 0:30:21.560 unfortunately we saw this year, this horrible example or this 0:30:21.640 --> 0:30:27.400 company character AI specifically started to find that their product 0:30:27.440 --> 0:30:31.040 was turning into a suicide coach for their customers. And 0:30:31.880 --> 0:30:33.640 one of the most terrific things I've ever seen in 0:30:33.680 --> 0:30:37.360 technology is these children you know died and it was 0:30:37.400 --> 0:30:40.080 completely unnecessary. And I think it needs to be a 0:30:40.120 --> 0:30:43.440 wake up call that you know, we're letting all of 0:30:43.480 --> 0:30:47.520 this AI technology out fully unregulated. And by the way, 0:30:47.560 --> 0:30:49.960 you remember that's true what we did with social media 0:30:49.960 --> 0:30:52.160 as well. And you probably remember what I said in 0:30:52.160 --> 0:30:55.920 twenty eighteen here, you know, which was social media was 0:30:55.960 --> 0:30:59.760 becoming the same kind of very dangerous technology. And look, 0:30:59.760 --> 0:31:01.880 a lot lot of governments have made changes around social 0:31:01.920 --> 0:31:03.640 media now, so you go to a lot of countries, 0:31:03.840 --> 0:31:06.560 if you're not seventeen eighteen years old, you're not going 0:31:06.560 --> 0:31:09.320 to use social media. They're our controls or our protections. 0:31:09.800 --> 0:31:12.760 We need to get there with AI now. There doesn't 0:31:12.760 --> 0:31:15.000 need to be any more deaths. You know, we need 0:31:15.040 --> 0:31:18.520 to be like taking this seriously. And AI is great, 0:31:18.600 --> 0:31:23.960 it's incredible, but these models, you know, they're inaccurate, they hallucinate, 0:31:24.520 --> 0:31:26.160 they're kind of hard to control. 0:31:26.360 --> 0:31:27.200 So what should we do? 0:31:27.320 --> 0:31:30.800 I mean, should CEOs be held personally liable? Should I 0:31:30.840 --> 0:31:33.480 was talking to Demis hassibus as CEO of Google Deep Mind, 0:31:34.440 --> 0:31:37.120 and he I asked, look, if we knew every company 0:31:37.200 --> 0:31:39.400 in every country would pause, should. 0:31:39.120 --> 0:31:40.040 We pause AI? 0:31:40.960 --> 0:31:44.400 So society and regulation can catch up and he said, yes, 0:31:44.480 --> 0:31:45.560 he would be in favor of that. 0:31:45.600 --> 0:31:46.880 Would you be in favor, Emily? 0:31:46.960 --> 0:31:48.800 Number One, Tech hates regulation. 0:31:48.960 --> 0:31:49.320 You know that. 0:31:49.400 --> 0:31:51.240 They hate it, right, they get people on, oh, it 0:31:51.320 --> 0:31:54.320 slows down innovation. They hate regulation. They hate it, they 0:31:54.320 --> 0:31:56.400 hate it. They hate it except one regulation they love 0:31:56.880 --> 0:31:59.960 Section two thirty, which basically says they're not held respond 0:32:00.400 --> 0:32:03.400 accountable for these deaths or for anything that their social 0:32:03.400 --> 0:32:06.360 media or their AI does, and that needs to change. 0:32:09.040 --> 0:32:12.920 There was Salesforce CEO Marc Benioff speaking with Bloomberg's Emily Chang. 0:32:19.360 --> 0:32:21.680 A crucial speech from the President of the United States 0:32:21.720 --> 0:32:23.840 and Davos eases some of the tensions in the market. 0:32:23.840 --> 0:32:26.320 We're now up eight ten percent on the Nasdaq one hundred, 0:32:26.360 --> 0:32:28.920 having had on the broader markets in the SMP the 0:32:28.960 --> 0:32:32.320 worst day since April yesterday. Now we bounce back a 0:32:32.360 --> 0:32:34.520 little bit. We've seen a holt and slides on bonds, 0:32:34.560 --> 0:32:37.480 on crypto as well as the President says he would 0:32:37.520 --> 0:32:39.840 not be wanting to use force when it comes to 0:32:39.880 --> 0:32:43.280 his attention on Greenland Nasdaq. If you look under the 0:32:43.280 --> 0:32:45.120 hood and video as your biggest points contributed to the 0:32:45.200 --> 0:32:48.400 upside of the downside, it's Microsoft and this name Netflix 0:32:49.000 --> 0:32:52.040 currently down by some four percentage points. We had been 0:32:52.080 --> 0:32:54.400 lower earlier in trading, and that's. 0:32:54.200 --> 0:32:55.680 After we saw well. 0:32:55.520 --> 0:32:59.040 Profit forecasts disappoint the market after we got its earnings. 0:32:59.480 --> 0:33:01.800 We look what Blue Meg Intelligence has been writing, and 0:33:01.840 --> 0:33:06.480 it's calling the MNA noise also driving investor sentiment. Pleas 0:33:06.520 --> 0:33:09.160 to say, Bluemeg Intelligence is keithan rag and Atham. 0:33:09.040 --> 0:33:09.680 Is here with us. 0:33:09.760 --> 0:33:13.240 So ether the m and A noise is also MNA 0:33:13.360 --> 0:33:15.720 spending and that seems to be where the margin is 0:33:15.760 --> 0:33:16.400 getting a knock. 0:33:17.720 --> 0:33:20.040 Yeah, that's exactly what it is, Caroline. And so we 0:33:20.080 --> 0:33:22.760 saw for the first time that you know, content cost 0:33:22.880 --> 0:33:25.720 is actually going to be higher than expected. Ten percent 0:33:25.760 --> 0:33:28.800 content cost growth is what they're forecasting for twenty twenty six. 0:33:29.040 --> 0:33:31.720 You compt that to about high single digits in prior years. 0:33:32.040 --> 0:33:34.560 And really, I mean this is just a microcosm of 0:33:34.640 --> 0:33:37.080 what we're seeing on a much bigger level with the 0:33:37.080 --> 0:33:40.560 whole eighty three billion dollar acquisition of Warner. They're basically 0:33:40.600 --> 0:33:44.440 paying for content, They're basically paying to keep that engagement 0:33:44.520 --> 0:33:46.000 level up. And I think what was a little bit 0:33:46.040 --> 0:33:48.080 disconcerting from you know, there was obviously a lot of 0:33:48.200 --> 0:33:50.920 nuance in the earnings report. But what we saw was 0:33:50.960 --> 0:33:54.360 you know, engagement growth. Yes, you know it did grow, 0:33:54.440 --> 0:33:57.520 but by a very modest amount, only about two percent 0:33:57.560 --> 0:34:00.600 the whole year. And remember this was a year where 0:34:00.600 --> 0:34:03.360 they really had blockbuster content. I mean whether it was 0:34:03.360 --> 0:34:06.920 Stranger Things or Squid Game or K Pop Demon Hunters. 0:34:06.960 --> 0:34:08.279 I mean, this was the year when we should have 0:34:08.320 --> 0:34:10.560 seen a much bigger uptic in engagement growth, which kind 0:34:10.600 --> 0:34:12.719 of really then leads us to the fact that, you know, 0:34:12.800 --> 0:34:15.560 this is why they need to buy Warner and this 0:34:15.640 --> 0:34:18.840 is why you know you have that acquisition KEITHA. 0:34:18.920 --> 0:34:20.600 In the time that we've come on air here on 0:34:20.640 --> 0:34:24.680 Bloomberg Tech, Bloomberg's reported that the EU is going to 0:34:24.840 --> 0:34:28.760 probe both the Netflix and Paramount bids for Warner Brothers 0:34:28.840 --> 0:34:33.160 Discovery in parallel, which is a somewhat unprecedented approach for 0:34:33.440 --> 0:34:35.760 two companies to go head to head in the context 0:34:35.800 --> 0:34:38.600 of a regulatory probe. What is the regulatory risk on 0:34:38.640 --> 0:34:40.680 this to you? You know, I know that you're trying 0:34:40.680 --> 0:34:42.839 to model for what happens next, and I always ask you, 0:34:43.040 --> 0:34:44.720 he hearing a Nathan, what happens next? 0:34:45.880 --> 0:34:49.759 Yeah, regulatory risk definitely is a big one there ed 0:34:50.360 --> 0:34:54.360 definitely much higher for Netflix compared to a paramount, especially 0:34:54.360 --> 0:34:56.200 as you look at the streaming concentration in some of 0:34:56.200 --> 0:34:58.960 the European markets. You just look at the basic size 0:34:59.040 --> 0:35:01.399 of Netflix subscribe base, it's about three hundred and twenty 0:35:01.440 --> 0:35:03.799 five million. Combine that with about one hundred and twenty 0:35:03.840 --> 0:35:07.319 five million with Warner Brothers. Again, you have four hundred 0:35:07.320 --> 0:35:09.520 and fifty million. And in some of those European markets, 0:35:09.600 --> 0:35:11.800 that risk is really really high. It's high even in 0:35:11.840 --> 0:35:14.240 the United States at about thirty five to forty percent, 0:35:14.480 --> 0:35:17.799 but definitely higher there. So antitrust is definitely going to 0:35:17.840 --> 0:35:20.360 be a huge part. Apart from that, you also have 0:35:20.440 --> 0:35:22.439 the financial risk. I mean, is this going to turn 0:35:22.480 --> 0:35:25.600 into a really ugly bidding war. So that's also something 0:35:25.640 --> 0:35:27.279 that we're kind of on the lookout for. 0:35:28.480 --> 0:35:30.799 Keith ranging up and from Bloomberg Intelligence. Great to have 0:35:30.840 --> 0:35:32.600 you back, Thank you so much. Let's turn to the 0:35:32.640 --> 0:35:36.319 private markets during delivery startup zip Line has closed the 0:35:36.360 --> 0:35:39.120 more than six hundred million dollar funding round, putting the 0:35:39.120 --> 0:35:43.320 company's valuation at seven point six billion dollars. Keller Clifton, 0:35:43.400 --> 0:35:46.800 sit Line CEO co founder joins us. Now it's a 0:35:46.840 --> 0:35:49.040 big jump in valuation, although I don't think you actually 0:35:49.040 --> 0:35:51.719 ever disclosed the twenty twenty four round that put you 0:35:51.760 --> 0:35:54.719 a pretty significant valuation of five billion anyway, But there's 0:35:54.760 --> 0:35:57.239 a lot of interest in this color and why do 0:35:57.360 --> 0:35:58.160 you raise the funds? 0:35:58.200 --> 0:35:59.160 What are you going to use them for? 0:36:00.120 --> 0:36:01.839 Well, I mean, you know, we spent most of last 0:36:01.920 --> 0:36:04.960 year expanding the service aggressively in Dallas. It's been an 0:36:04.960 --> 0:36:08.080 amazing place to you know, for almost a decade ZIP 0:36:08.080 --> 0:36:12.319 when operated mainly outside the US, and last year there 0:36:12.360 --> 0:36:16.640 was basically regulatory progression in the US that allowed this 0:36:16.680 --> 0:36:20.640 technology to start serving US citizens. And what we've seen 0:36:20.800 --> 0:36:24.160 is just like explosive growth and basically infinite demand on 0:36:24.440 --> 0:36:26.640 behalf of customers. I mean, it turns out when you 0:36:26.800 --> 0:36:30.439 design delivery where anybody can pull out their phone, order 0:36:30.440 --> 0:36:32.160 anything they need, have it delivered to their home in 0:36:32.200 --> 0:36:34.480 less than ten minutes, people use that service a lot 0:36:34.640 --> 0:36:37.520 like ten times as much as we've seen usage for 0:36:37.560 --> 0:36:41.440 traditional delivery services. And so yeah, this funding round is 0:36:41.440 --> 0:36:44.200 going to allow us to start announcing new metros. Today, 0:36:44.239 --> 0:36:46.800 we're announcing that we're launching Houston and Phoenix over the 0:36:46.840 --> 0:36:50.120 coming months, and then we'll launch every quarter that comes now, 0:36:50.120 --> 0:36:52.080 will add new metros to the overall network. 0:36:51.840 --> 0:36:55.040 And what's the scale of those launches at first? Right 0:36:55.080 --> 0:36:57.200 that you know, when I shared some of the data 0:36:57.239 --> 0:36:58.600 that you put out there on x there was a 0:36:58.640 --> 0:37:01.120 lot of interest on the rates of it expansion. You know, 0:37:01.160 --> 0:37:04.279 the headline is two million deliveries, but if you think 0:37:04.280 --> 0:37:07.120 about what we're talking about lost mile delivery, that's such 0:37:07.160 --> 0:37:09.440 a tiny fraction of what a delivery van will do. 0:37:10.120 --> 0:37:10.960 How real is this? 0:37:11.760 --> 0:37:14.480 I mean the data that we're seeing again just in 0:37:14.480 --> 0:37:16.360 a single metro in the US, but the data is 0:37:16.480 --> 0:37:19.920 mind blowing. I mean, we have municipalities in Dallas where 0:37:20.520 --> 0:37:23.680 just on Sunday, ten percent of homes placed an order 0:37:23.680 --> 0:37:26.880 with Zipline in the municipality. So it's like, you know, 0:37:26.960 --> 0:37:30.640 we have certain cities where more than fifty percent of 0:37:30.680 --> 0:37:34.799 homes are engaged Zipline customers. So this has definitely gone 0:37:34.800 --> 0:37:37.600 from like science fiction to completely normal and something people 0:37:37.640 --> 0:37:40.360 depend on day in and day out in just a 0:37:40.400 --> 0:37:43.000 few months. Yeah, the service has been growing about fifteen 0:37:43.040 --> 0:37:44.959 percent week over a week over the last year. 0:37:45.360 --> 0:37:48.360 Kind of also unit economics of it, how much you 0:37:48.480 --> 0:37:51.160 having to spend on each of these deliveries. 0:37:52.840 --> 0:37:53.880 The advantagement. 0:37:53.920 --> 0:37:56.520 It shouldn't be that surprising, But actually, I think people 0:37:56.640 --> 0:37:59.200 may not realize when when you're talking about instant normal 0:37:59.239 --> 0:38:01.960 instant delivery, we're using a four thousand pound gas combustion 0:38:02.080 --> 0:38:04.719 vehicle driven by a human to deliver something to your 0:38:04.719 --> 0:38:08.120 house that weighs five pounds. It's actually a super expensive solution. 0:38:08.239 --> 0:38:09.960 This is the reason that there are so many fees. 0:38:10.000 --> 0:38:14.839 And then you know, tip on top autonomous systems are 0:38:14.880 --> 0:38:17.640 going to be less expensive ten times as fast plus 0:38:17.640 --> 0:38:20.720 their zero emission. So these kinds of systems are already 0:38:20.719 --> 0:38:24.240 cost comparable today, they'll be significantly less expensive in the future. 0:38:25.000 --> 0:38:27.280 There is a lot of interest in this particular funding 0:38:27.400 --> 0:38:31.279 round because some of the names involved are the whole 0:38:31.360 --> 0:38:35.320 marks of a pre IPO round some anchor tenant investors. 0:38:35.719 --> 0:38:37.719 Is that a fair assumption to make? 0:38:38.400 --> 0:38:39.919 I mean, zip Line has been really lucky. 0:38:39.960 --> 0:38:42.160 I think that there's a lot you know, we've been 0:38:42.160 --> 0:38:44.239 building this company for twelve years, but I think it's 0:38:44.320 --> 0:38:47.720 finally kind of obvious that robotics is going to remake 0:38:47.800 --> 0:38:49.400 the planet over the last I mean, I think it's 0:38:49.440 --> 0:38:53.960 going to transform a lot of economies and logistics is 0:38:53.960 --> 0:38:57.040 one of the most obvious places where automation and robotics 0:38:57.040 --> 0:39:01.040 can have a huge impact. It can improve service, prove reliability, 0:39:01.360 --> 0:39:04.000 and it's something that people are going to depend on 0:39:04.080 --> 0:39:05.319 day in and day out. By the way, it can 0:39:05.360 --> 0:39:07.200 also create a lot of high paying jobs in the 0:39:07.280 --> 0:39:09.839 United States, both on the manufacturing front as well as 0:39:09.880 --> 0:39:10.520 like maintenance. 0:39:10.520 --> 0:39:11.239 We're building out. 0:39:11.440 --> 0:39:14.680 It's complicated new kinds of infrastructure in each of these cities. 0:39:14.800 --> 0:39:16.720 It's the reason that every city has been so excited 0:39:16.719 --> 0:39:19.120 to have Zipline comme. It's creating high paying jobs. We're 0:39:19.160 --> 0:39:22.480 investing in the in each of those cities that were launching. 0:39:22.920 --> 0:39:24.560 I'm not sure that was an answers to whether you're 0:39:24.600 --> 0:39:27.720 going to be ipoing or not, but I go really 0:39:27.840 --> 0:39:30.440 more to calor the fact that this is a global company. 0:39:30.880 --> 0:39:34.719 We're looking at your drones delivering food, but it's really 0:39:34.719 --> 0:39:36.960 about medicine and health and in particular over in Africa. 0:39:37.000 --> 0:39:38.759 Can you talk to us about how much of the 0:39:38.760 --> 0:39:39.879 scale of the business is there. 0:39:41.080 --> 0:39:41.800 Well, yeah, Zipline. 0:39:41.840 --> 0:39:43.560 You know, when we started the company, what we do 0:39:43.760 --> 0:39:46.120 what we do today was illegal in the United States, 0:39:46.120 --> 0:39:48.880 so not an ideal pitch for investors. But this was 0:39:48.920 --> 0:39:51.600 the reason that we initially partnered with the government of Rwanda. 0:39:52.200 --> 0:39:55.040 You know, today's Zipline serves five thousand hospitals and health 0:39:55.080 --> 0:39:58.640 facilities across the world outside the US, or a huge, 0:39:58.960 --> 0:40:01.759 huge healthcare logistic network. We've now done one hundred and 0:40:01.800 --> 0:40:05.040 thirty five million commercial autonomous miles with zero safety incidents, 0:40:05.239 --> 0:40:07.640 and the system is saving about seventeen thousand lives a year, 0:40:07.680 --> 0:40:11.440 predominantly moms and kids. One cool thing, just this week 0:40:11.560 --> 0:40:15.120 we announced a new national scale partnership with the government 0:40:15.160 --> 0:40:18.200 of Rwanda. We're going to be dramatically expanding the number 0:40:18.239 --> 0:40:21.560 of use cases, building a new distribution center, and for 0:40:21.600 --> 0:40:25.000 the first time ever, ZIP is bringing its next generation technology, 0:40:25.000 --> 0:40:27.600 which we call Platform two, to the continent of Africa. 0:40:28.239 --> 0:40:30.560 CAWT of those regulatory changes you were talking about were 0:40:30.640 --> 0:40:33.200 the President's EO in June and then later in the 0:40:33.239 --> 0:40:37.480 summer the line of sight rules. Right, this is all 0:40:37.680 --> 0:40:43.000 in the context of This is all in the context 0:40:43.120 --> 0:40:47.080 of the President's focus on this as a national security priority. 0:40:47.200 --> 0:40:49.560 I hope this question doesn't shock you, but how is 0:40:49.640 --> 0:40:53.440 Zipline thinking about literally weaponizing the technology its use in 0:40:53.480 --> 0:40:56.240 defense use cases? Conversations with the President? 0:40:56.680 --> 0:40:58.799 Well, the great news is actually that you know, the 0:40:58.800 --> 0:41:01.279 government is trying to accomph a lot of things. They're 0:41:01.360 --> 0:41:04.480 really focused on AI and exports and commercial diplomacy. 0:41:04.520 --> 0:41:05.080 This is the reason. 0:41:05.400 --> 0:41:08.160 Just five weeks ago, Zipline announced a five hundred and 0:41:08.160 --> 0:41:11.279 fifty million dollars total partnership with the State Department as 0:41:11.280 --> 0:41:14.520 well as all of our African country partners to basically 0:41:14.640 --> 0:41:16.799 make sure that the developing world is built on top 0:41:16.800 --> 0:41:20.360 of USAI and robotics infrastructure. That's really good because it 0:41:20.400 --> 0:41:23.319 can make sure that these countries enables these countries to 0:41:23.360 --> 0:41:26.040 save money and save lives. But it is also a 0:41:26.120 --> 0:41:28.480 key way of making sure that the US can maintain 0:41:28.520 --> 0:41:31.759 its manufacturing and technology leadership for the decade to come. 0:41:31.800 --> 0:41:34.440 So Zipline is already working really closely on those initiatives. 0:41:34.680 --> 0:41:37.080 This announcement with Rwanda would not have happened without that 0:41:37.120 --> 0:41:38.880 partnership from the US State Department. 0:41:39.200 --> 0:41:42.000 It's a big funding round, is a big valuation Siplin 0:41:42.080 --> 0:41:44.080 C Kelly Clifton, thanks for joining us.