Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
Speaker 2: From Mahart where innovation, money and power Collie in Silicon
Speaker 2: Vallet n Beyond.
Speaker 3: This is Bloomberg Technology with Caroline Hyde and.
Speaker 4: Ed Lovedlove.
Speaker 5: Live from New York and San Francisco. This is Bloomberg Technology.
Speaker 5: And there's change at Apple as the CFO mice three
Speaker 5: steps back and the iPhone maker promotes from within. We
Speaker 5: have the details on Apple's new finance chief.
Speaker 4: A Meta calls out the White House. CEO Mark Zuckerberg
Speaker 4: says the government pressured Facebook to censor their COVID post
Speaker 4: during the pandemic and he regrets giving in.
Speaker 5: Meanwhile, the NFL Kelsey Brothers wind big a one hundred
Speaker 5: million dollar podcast deal with Amazon after Taylor Swift helped
Speaker 5: spump the audience.
Speaker 4: JD dot Com five billion dollar share buy back positive
Speaker 4: for the US listed shares. Why it's a really tough
Speaker 4: environment right now for e commerce in China. This is
Speaker 4: something that is shareholder friendly while the macro picture deteriorates.
Speaker 4: And we're going to get a bit more on that
Speaker 4: as well.
Speaker 5: Kart, Yeah, because it is ugly out there for Pinduo
Speaker 5: Duo PDD. Once again, let's focus in on some that
Speaker 5: are trying to support the market others that are hurting
Speaker 5: the brand Vasthelka and Ryan, it really was a shock
Speaker 5: to the system that PDD wasn't doing as well as
Speaker 5: had been anticipated, that even the cheap stuff isn't selling
Speaker 5: in China. What do does that mean from a broader
Speaker 5: context when it comes to China.
Speaker 4: Warning thanks for having me.
Speaker 6: You know, there's a lot of concern about the strength
Speaker 6: of the Chinese economy right now, and seeing a company
Speaker 6: like this, which is so tied to the consumer, seeing
Speaker 6: them really give a pretty tepid outlook, pretty cautious, is
Speaker 6: certainly a reason to have some sort of broader concerns
Speaker 6: just about the state of things there and what the
Speaker 6: outlook is for China going for We did see that
Speaker 6: stock drop I think more than twenty percent yesterday. It
Speaker 6: is down a little bit more today. So there are
Speaker 6: just some broader concerns now about just the strength of
Speaker 6: you know, one of the biggest economies in the world.
Speaker 4: So ryanthjd dot com story is kind of a read
Speaker 4: through one where they are trying to do something to
Speaker 4: I guess, disassociate themselves with the wider e commerce picture
Speaker 4: in China and buybacks always cheer up investors.
Speaker 6: Yeah, absolutely, And this of course comes after Walmart recently
Speaker 6: closed outs at Stake and JD, so there's certainly been
Speaker 6: some costs for concern for those investors. Obviously they are
Speaker 6: trying to signal, you know, it's still a focus on
Speaker 6: scheerholder value and so forth. So yeah, five billion buyback
Speaker 6: never bad headline.
Speaker 5: I am just really interested in ultimately the context of
Speaker 5: China and appetite to be buying into what are sold
Speaker 5: off names? What point do we get lured back in
Speaker 5: Because we saw real volatility around US tech names at
Speaker 5: the start of August and people bought the dip. Why
Speaker 5: not in China at the moment, Ryan.
Speaker 6: I think there are just some broader macro cons learns
Speaker 6: about their economic outlook, whereas people are feeling a little
Speaker 6: bit more positive about the US people are anticipating rate cuts.
Speaker 6: It seems like a lot of the major megacap tech
Speaker 6: stocks here in the United States continue to post pretty
Speaker 6: strong fundamentals, pretty strong trends. AI remains a huge focus,
Speaker 6: and of course, you know, the biggest players in AI
Speaker 6: are all here in the US, and that's just you know,
Speaker 6: very easy decision I think for people to continue looking
Speaker 6: at US names, continue buying US big.
Speaker 4: Tech, that picture tells the story as of this morning session.
Speaker 4: Bloomberg's rhyme Bastelica, thank you very much. Let's get a
Speaker 4: closer look at tech stocks this morning and think about
Speaker 4: the equity markets and what is a massive week in
Speaker 4: each Chisholm is the director of Quantitative market Strategy Fidelity Investments.
Speaker 4: And there is this like big macro event happening on Wednesday.
Speaker 4: I don't know if you've heard about it. It's called
Speaker 4: Nvidia second quarter earnings. But what's so interesting is like
Speaker 4: the timing comes after many weeks of very clear capital
Speaker 4: expenditures guidance. So you track that data and you ask yourself,
Speaker 4: what does it tell us? I know that you look
Speaker 4: at capex to sales and you might have a different story. Denise, Yeah,
Speaker 4: I do have a different story.
Speaker 7: I mean, there is a lot of concern by investors
Speaker 7: around how much technology companies are going to have to
Speaker 7: spend in terms of CAPEX, and that might be a
Speaker 7: signal of sort of the peak of the cycle. But
Speaker 7: when you look at the data for the overall technology sector,
Speaker 7: CAPEX is just starting to pick up now. And when
Speaker 7: you look at capecs relative to sales, it's actually declined
Speaker 7: over the last year and it's in the bottom half
Speaker 7: of the distribution. I think that that is the unique
Speaker 7: part this time in terms of technology. The free cash
Speaker 7: flow generation is much much different than anything that we've
Speaker 7: seen in the past. So on that free cash flow generation,
Speaker 7: the stocks are actually still cheap on price to free
Speaker 7: cash flow on a relative basis versus the rest of
Speaker 7: the market, which actually cushions the blow to the extended
Speaker 7: fundamentals have peaked and may slow, so some of that
Speaker 7: mean reversion might actually be priced.
Speaker 4: In index level discussion to be had. You know, I
Speaker 4: know that you don't track a specific name, but there's
Speaker 4: this fantastic chart right which shows that when the S
Speaker 4: and P five hundred moves a percentage point nine direction,
Speaker 4: it's usually in Nvidia's fault and the market there's not
Speaker 4: much left thereafter. What do you make of that, the
Speaker 4: sort of dependence on that high concentration of single names
Speaker 4: at the index level, Denise.
Speaker 7: Yeah, we have a lot of data on historical market concentration,
Speaker 7: and it's true we haven't seen the market become this
Speaker 7: concentrated this quickly over the last year or be this
Speaker 7: concentrated since you know, basically the eighties or the late seventies.
Speaker 7: But that concentration level in and of itself doesn't necessarily
Speaker 7: mean it's a negative signal for the market going forward.
Speaker 7: The market can stay heavily concentrated for unextended period of time.
Speaker 7: We certainly saw this in the forties and fifties, which
Speaker 7: is not to say that that's the exact parallel, But
Speaker 7: I think what's more important to me, as much as
Speaker 7: there's been a bifurcation between cap weighted indusses and equal
Speaker 7: weighted indocy really lagging, I think that a lot of
Speaker 7: the signals that I'm seeing suggests that there might be
Speaker 7: a much more broadening out over the next year on
Speaker 7: a relative basis, where it's not just technology stocks being
Speaker 7: the dominant leaders, and the market might actually encompass more
Speaker 7: maybe interesst rate sensitives and more cyclical sectors outperforming as well.
Speaker 7: I think the unique part of this cycle was around
Speaker 7: technology fundamentals. Technology fundamentals did something on an aggregate level
Speaker 7: that I've never seen in my database going back to
Speaker 7: the sixties, which is go from bottom quartile growth bottom
Speaker 7: quartile growth to top decile growth in under a year. Well,
Speaker 7: when that happens, that begets that relative outperformance we've seen.
Speaker 7: But as the starting point from this level, it doesn't
Speaker 7: necessarily mean technology will lag the market, as those cash
Speaker 7: flows and earnings growth might actually be durable. But it
Speaker 7: does usually mean that it makes room for other sectors
Speaker 7: to outperform as well.
Speaker 5: What's so interesting, though, is how one sided the mack
Speaker 5: it is on the single name. At the moment, analysts
Speaker 5: sixty six of them say buy and VIDIA zero say sell.
Speaker 5: But then I go to the SMP more broadly, and
Speaker 5: the price targets just aren't that many ahead of where
Speaker 5: we currently trade at the moment at fifty six twenty eight,
Speaker 5: and well most of the analysts actually see lower than that.
Speaker 5: So when we do give up leadership so to speak,
Speaker 5: with the big tech names in the mag seven, is
Speaker 5: it not going to be If they lag, it won't
Speaker 5: be made up for by the other smaller players that
Speaker 5: suddenly do rally.
Speaker 4: Well, I think you could end.
Speaker 7: Up in this situation where the big names just potentially
Speaker 7: tread water with a catchup trade in the equoated indices.
Speaker 7: I think that the big difference that investors are concerned
Speaker 7: about is what we saw happen in two thousand, which
Speaker 7: is the mags let's call it the MAG seven this
Speaker 7: time versus the technology bubble last time was going down
Speaker 7: on an absolute basis. When you're talking about just maybe
Speaker 7: lagging or hanging in in terms of a relative perspective
Speaker 7: and growing into those multiples, I think that that's a
Speaker 7: much different story from a risk reward perspective, and it
Speaker 7: sets up the rest of the market that really hasn't
Speaker 7: seen the earnings growth recovery that we've seen in those
Speaker 7: cap weighted indices to still play out over time, which
Speaker 7: gives dominance to that equal weighted potential or down the
Speaker 7: cap spectrum relative performance.
Speaker 5: Do ultimately, though, does technology still look like it will
Speaker 5: outperform to the extent that we've almost become immune to look?
Speaker 7: I think it looks like a positive risk reward to me.
Speaker 7: And I say that because a after you've seen fundamental
Speaker 7: inflection like we've seen, the sector continues to outperform about
Speaker 7: seventy percent of the time because those free cash flows
Speaker 7: and earning's growth tends to be durable. And this goes
Speaker 7: back to the fact that when in a lot of
Speaker 7: my data twenty twenty two looked like either a very
Speaker 7: soft hard landing or a very hard soft landing, but
Speaker 7: it did look like a landing. And if that was
Speaker 7: in fact a landing, then we are in the early
Speaker 7: to mid stages of what could be a multiple year recovery,
Speaker 7: and that includes in terms of technology earnings growth. So
Speaker 7: if you couple that sort of durable cash flow on
Speaker 7: the valuation disconnect, which is to say that they're still
Speaker 7: on the bottom half of the distribution of relative free
Speaker 7: cash flow, I think you have a positive.
Speaker 4: Risk reward denise very quickly. Historically, when the S and
Speaker 4: P five hundred gains double digits in one h it
Speaker 4: does well in the second half of the year. Will
Speaker 4: that happen, that's correct.
Speaker 7: Well, I can't tell you if it will happen, But
Speaker 7: you know the math, which is a ball in motion,
Speaker 7: tends to stay in motion. And it's all around the
Speaker 7: fact that usually the stock market gets it right. And
Speaker 7: by that I mean it might actually be telling you
Speaker 7: something that you don't really know already, which is that
Speaker 7: more of the S and P five hundred might be
Speaker 7: discounting a hard landing than you think.
Speaker 5: Just such deep historical analysis, we love it Denistchism, thank
Speaker 5: you so much for joining you great to be here,
Speaker 5: Director of Quantitative Marketing Strategy over at Fidelity Investments.
Speaker 4: I meanwhile coming up.
Speaker 5: Close to look at Polaris Dawn.
Speaker 4: That didn't happen.
Speaker 5: SpaceX's first spacewalk mission has been delayed ed.
Speaker 4: What are you watching? I'm not going to share as
Speaker 4: a Walmart story that broke in the last ten minutes.
Speaker 4: The company wants to expand its online marketplace. This is
Speaker 4: the digital platform for third party vendors. You're thinking about
Speaker 4: competition with the likes of Amazon and Etsy and what
Speaker 4: they're doing. It's just adding more stuff to it. Think
Speaker 4: about pre owned watches, collectible trading cards. Is all part
Speaker 4: of an announcement they made out of San Francisco this
Speaker 4: morning for their seller's conference. Not doing much. The booster
Speaker 4: stock up three tens to one percent. Well track it.
Speaker 4: This has been a big technology.
Speaker 5: Taking a look now at SpaceX. The company has delayed
Speaker 5: that launch of a rocket carrying four private astronauts to space,
Speaker 5: part of what was going to be a groundbreaking mission
Speaker 5: aimed at performing the world's first commercial spacewalk.
Speaker 4: Pilaris Dawn.
Speaker 5: You want to get out to be Megsla and Grass
Speaker 5: who's been all over this once again.
Speaker 4: Helium.
Speaker 5: It's a recurring theme with these space issues.
Speaker 8: Yeah, helium is prone to leaking. It is a small molecule,
Speaker 8: so it can find its way out of various small crevices.
Speaker 8: But this is just comes with the territory of following
Speaker 8: rockets and rocket launches. There's always some kind of delay,
Speaker 8: but hopefully it won't be too lengthy for and hopefully
Speaker 8: we'll see this launch takeoff soon.
Speaker 4: They basically have a backup window every morning at the
Speaker 4: same time, right the way through the weekend, so I
Speaker 4: imagine it will go off. A big part of this
Speaker 4: is not necessarily the crew of Claris Dawn. It's the
Speaker 4: space suits, and you wrote about that last week in
Speaker 4: the Business of Space newsletter, like and subscribe. Tell me
Speaker 4: about the space suits and why they're so key to
Speaker 4: what's due to take place in the mission.
Speaker 2: Yeah.
Speaker 8: So, for people who have followed SpaceX up until now,
Speaker 8: you might be familiar with SpaceX's so called space suits.
Speaker 8: But the space suites that we've seen up until this
Speaker 8: point are really just pressure suits which are used by
Speaker 8: the astronauts. They're worn when they fly to space when
Speaker 8: they come back from space, and they're really mostly meant
Speaker 8: to be used in the case of an emergency, in
Speaker 8: case the capsule depressurizes or there's some unforeseen event. What
Speaker 8: SpaceX built for this specific purpose is a space walking spacesuit,
Speaker 8: and it's really meant to be used for this exact
Speaker 8: reason for being able to leave the vehicle perform repairs
Speaker 8: on the outside of a spacecraft. For this mission, SpaceX
Speaker 8: is just going to test out the durability of the suits.
Speaker 8: But these suits look pretty cool. They definitely look like
Speaker 8: the sleek white design of the pressure suits that we've seen,
Speaker 8: but they're supposed to be able to withstand the vacuum
Speaker 8: of space. Even better, they have heads up displays inside
Speaker 8: of them, and they have the signature SpaceX sile that
Speaker 8: we've all come to know and love.
Speaker 5: I mean, absolutely fascinating as to whether or not we're
Speaker 5: going to be missing in I mean the new way
Speaker 5: in which we see the suits evolved. Lauren ed was
Speaker 5: just tell it, talking us through the fact that we're
Speaker 5: going to be seeing a new launch window every single day.
Speaker 5: But ultimately, how quickly can things like helium lenk be recovered.
Speaker 8: From It's hard to speculate on this. I think when
Speaker 8: it comes to SpaceX, I am always amazed at how
Speaker 8: quickly they're able to kind of turn things around. If
Speaker 8: you recall, you know, about a month ago they had
Speaker 8: a failure with their Falcon nine rocket while launching some
Speaker 8: Starling satellites, and they were able to get back to
Speaker 8: launch within just a couple of weeks. So SpaceX has
Speaker 8: definitely garnered a lot of experience by launching so frequently,
Speaker 8: so it may be something that is easy to fix
Speaker 8: with this particular mission. I don't think SpaceX wants to
Speaker 8: be taking any chances. It's probably one of their riskiest
Speaker 8: missions that they've done to date. They'll be going to
Speaker 8: a much higher altitude than astronauts have gone to in
Speaker 8: a very long time, so I think they just want
Speaker 8: to make sure everything is buttoned up, so it's possible
Speaker 8: they might take some extra care with this particular healing week.
Speaker 4: I mean, I mean there is risk in this mission
Speaker 4: seven hundred kilometer altitude approximately for the spacewalk. Only two
Speaker 4: of them will do it. And what I find so
Speaker 4: amazing is like the cruising quarantine basically right now, and
Speaker 4: yet Jared Isaacman's on Twitter X saying or don't worry,
Speaker 4: we know exactly what's going on. We're talking with SpaceX.
Speaker 4: He's kind of key to this because he went on
Speaker 4: Inspiration four as well.
Speaker 8: Yeah, Jared Eisaman has definitely become an interesting SpaceX figure.
Speaker 8: He has bankrolled the development of this program and also
Speaker 8: helped to fund this flight, and he'll be flying again
Speaker 8: in the future too. He didn't just buy this one flight.
Speaker 8: He has kind of invested in an entire program, research
Speaker 8: and development program called Polaris, and this just is the
Speaker 8: first part of that. It'll eventually culminate with the first
Speaker 8: crude launch of SpaceX's Starship Rocket, which is that massive
Speaker 8: vehicle that they've been building in South Texas. I assume
Speaker 8: that Jared will be on that as well. We'll have
Speaker 8: to wait and see that because we still have some
Speaker 8: development road to get through. But yeah, he's definitely become
Speaker 8: a dominant figure in the SpaceX community.
Speaker 4: Okay, see three point thirty eight am Eastern time tomorrow,
Speaker 4: bloom Osler and Grush maybe thank you. Another big story
Speaker 4: we're tracking is Apple. Longtime Apple CFO Luka Maistrie will
Speaker 4: step down from the job at the end of the year.
Speaker 4: Handing the role to top deputy deputy Kevin Perek after
Speaker 4: more than a decade. More in the announcement, we go
Speaker 4: to Bloomberg's Mark German, I guess why why step back
Speaker 4: and why the number two getting promoted?
Speaker 1: Yeah, I mean, this is really not that interesting in
Speaker 1: the sense that this has been long planned. Apple has
Speaker 1: been telegraphing this for the last year or so. If
Speaker 1: you recall, at the end of last year, one of
Speaker 1: Luca ma Astree's top two deputies, Cii Casey, she resigned
Speaker 1: and then later became the CFO of Sonos, and to
Speaker 1: me at the time, that became pretty clear they were
Speaker 1: preparing for a transition and that it was not going
Speaker 1: to be her job, but.
Speaker 4: Rather Kevin Perek's. John Kevin Perek had.
Speaker 1: A series of responsibilities related to market research, financial analysis,
Speaker 1: preparation for earnings, investor relations, and then he picked up
Speaker 1: Saiori Casey's responsibility over financial planning and analysis at.
Speaker 4: The end of last year.
Speaker 1: He actually moved into her office at that time, and
Speaker 1: he has been the heir apparent for several months now
Speaker 1: to Luca Astree. He had been shadowing may Street. He
Speaker 1: had been working very closely with Apple's executive team and
Speaker 1: Tim Cook. So this is something that has been in
Speaker 1: the works for several months now. Luca just turned sixty, right,
Speaker 1: He's been in the corporate environment. He's been a CFO
Speaker 1: for decades now. He's obviously made a lot of money
Speaker 1: at Apple. Luca actually at some points in his career
Speaker 1: has commuted many, many miles to the Apple campus.
Speaker 2: This is obviously a very tough role.
Speaker 1: It's not a role you want to be in for
Speaker 1: more than a decade probably with everything at stake. He
Speaker 1: took over for Peter Openhimer in twenty fourteen.
Speaker 4: So it made sense.
Speaker 1: The bigger picture here is you're sort of probably going
Speaker 1: to see a big turnover of Apple's executive team over
Speaker 1: the next few years. And this strategy where they're not
Speaker 1: really allowing these executives to fully retire and just you know,
Speaker 1: play golf or you know, fly their planes or what
Speaker 1: have you and have them stick around a smaller role.
Speaker 4: This is now the.
Speaker 1: Third executive in a row in the last four years
Speaker 1: that we've seen do this. The question is how long
Speaker 1: is Luca going to stick around in this new role.
Speaker 1: And then one thing I know investors are curious about Perak.
Speaker 1: Everything I've been told and everything that I believe is
Speaker 1: that he's ready for this role. And I don't expect
Speaker 1: any hiccups.
Speaker 5: As you say, he's going to be overseeing information technology
Speaker 5: and real estate functions, we understand, but in that reduced role. Meanwhile, Mark,
Speaker 5: all of this is in the broader context of they've
Speaker 5: got to still be selling shit phones. They've got to
Speaker 5: be innovating.
Speaker 4: And September the ninth.
Speaker 5: We understand is and we're going to be getting our
Speaker 5: eyes on the latest new phones.
Speaker 1: Yeah, September ninth, the iPhone sixteen line, new AirPods, new
Speaker 1: Apple Watches will all be introduced, and then we'll get
Speaker 1: the performance of how these phones did from Kevin Krek
Speaker 1: at the end of January that during his first earnings
Speaker 1: call SCFO, and all expectations are we're going to see
Speaker 1: some decent growth in the holiday period over the iPhone
Speaker 1: fifteen pro. There were no major new Apple watches a
Speaker 1: year ago, no major new AirPods a year ago, so
Speaker 1: they've sort of set themselves up for a little bit
Speaker 1: of a layup to give themselves some nice growth in
Speaker 1: the holiday period.
Speaker 5: Wel Gumman, as always, we thank you so much time
Speaker 5: now for talking tech. First up, LG Electronics is considering
Speaker 5: an initial public offering for his India business to having
Speaker 5: a booming stock market to help hit a target seventy
Speaker 5: five billion dollars in electronics revenue by twenty thirty. Here's
Speaker 5: what LGCS and William Show had to say about the
Speaker 5: market opportunity in India.
Speaker 3: In India, we boast a number one market share in
Speaker 3: every single product. So as you know, India is one
Speaker 3: of the fastest growing markets in the world and the
Speaker 3: India will be continued to be a key market for
Speaker 3: our growth. But it's not about just the product sales.
Speaker 3: We aim to be the national brand in India. So
Speaker 3: as a company who have grown and loved by Indian people,
Speaker 3: we understand we should grow with Indian people and providing
Speaker 3: the product and solutions which will make eventually their life better.
Speaker 9: And to the.
Speaker 3: IPO, yeah, I understand there's increased interest in Indian market
Speaker 3: among global investories.
Speaker 5: It's the first time in South Korean company has spoken
Speaker 5: publicly about an Indian debut, subject of persistent market and
Speaker 5: media speculation. Plus Sony while it's raising its price of
Speaker 5: its PlayStation five in Japan by nineteen percent to nearly
Speaker 5: eighty thousand Japanese yen or five hundred and fifty US dollars,
Speaker 5: almost four years into the console's life cycle. The surprise
Speaker 5: move comes even as PS five sales actually slowed, and
Speaker 5: Sony is widely expected to refresh its offering with a
Speaker 5: more powerful Mint cycle revamp of the console in coming months.
Speaker 5: One they all watching, I'm sure ed, what have we
Speaker 5: got coming up?
Speaker 4: Okay, big story Mark Zuckerberg alleging that Facebook was pressured
Speaker 4: by the US government to censor content related to COVID
Speaker 4: nineteen during the pandemic. That story's next. This is Bloomberg Technology.
Speaker 5: Welcome back to Bloomberg te anology of Karaine Hyde in
Speaker 5: New York.
Speaker 4: Ed Ludlow in San Francisco. Meta is interesting as well. Caro,
Speaker 4: give us the headline behind what's going with Meta. It
Speaker 4: was a big one that broke last night. Backward looking
Speaker 4: not doing much of the stock. It's completely flat. But
Speaker 4: this is a story that on social media and elsewhere
Speaker 4: everyone's talking about.
Speaker 5: It is because CEO Mark Zuckerberg has been penning a
Speaker 5: letter to Congress where he alleges that Facebook was pressured
Speaker 5: by the Biden administration to censor content related to COVID nineteen.
Speaker 5: He says he regrets the company's decision to accede to
Speaker 5: the demands for more and pleased to say we're John
Speaker 5: Babloomberg's Asha counts and this is to the Committee on
Speaker 5: the Judiciary of the US House of Representatives. Why put
Speaker 5: forward this viewpoint right now?
Speaker 2: Asia?
Speaker 10: I mean, it's such a contentious time, right We're going
Speaker 10: into the election, We're just a couple months away. Content
Speaker 10: moderation has been a topic of conversation for a long time,
Speaker 10: but it feels like even more so election policies, so
Speaker 10: change employees that do things like content safety have been
Speaker 10: fired or like, oh and Matt has been taking a
Speaker 10: step back from politics and news. So the timing of
Speaker 10: it sort of makes sense to me as we head
Speaker 10: into the eve of a really consequential election, and it's
Speaker 10: almost like Zepbywork's saying we're not going to do the
Speaker 10: things that we did in the past during this election.
Speaker 4: There are kind of two storylines here at ASIA. There's
Speaker 4: the allegation that Facebook was pressured by government officials, and
Speaker 4: then there's the admission of regret on the actions that
Speaker 4: Meta or Facebook did take at the height of the pandemic.
Speaker 4: What were those actions? What were the kind of things
Speaker 4: that Meta or the Facebook platform did when it found
Speaker 4: certain content relating to COVID nineteen.
Speaker 10: I mean, it was pulling certain content, right If content
Speaker 10: was considered a misinformation or misleading, it was either pulling
Speaker 10: that content. Sometimes there was a note that was directing
Speaker 10: people to CDC resources or saying that this has not
Speaker 10: been verified. It was those sorts of things. So it
Speaker 10: was a mix of labeling things. But then also some
Speaker 10: post and content were removed, which you know, as Zuckerberg said,
Speaker 10: he sort of regressed at the time. At the time,
Speaker 10: some people felt like that was sinistering and voices were
Speaker 10: not being heard. And so there was a lot of
Speaker 10: things that were happening at the time. And again, like
Speaker 10: this sort of movement and the moment in social media,
Speaker 10: a lot of these companies are pulling back from taking
Speaker 10: down content like that. They're either just labeling it and
Speaker 10: leaving it up all together, or they're just not doing anything.
Speaker 10: So it's a very different environment than it was even
Speaker 10: just a couple of years ago.
Speaker 5: But still governments pushed back on that, and we see
Speaker 5: what's just happened to the CEO of Telegram for the
Speaker 5: fact that they leave a lot of content unmoderated. We'll
Speaker 5: get into that in a moment Asia, But on the
Speaker 5: nuts and bolts of things, it was still Meta's ultimate
Speaker 5: decision on what to take down. It's just they felt
Speaker 5: that the pressure was unnecessarily coming from the government. Right.
Speaker 10: That was one of the key things that I took
Speaker 10: away from it as well, Like Stonerbrick knowledged, we made
Speaker 10: the decision. We took down the content. They have control
Speaker 10: over their own platform. They didn't like the pressure that
Speaker 10: they were feeling, but again they did ultimately make the
Speaker 10: decision and themselves, and the decision rests with them regardless.
Speaker 4: Right with both Asha counts on a really top story
Speaker 4: on the Bloomberg Today. Thank you very much. Let's keep
Speaker 4: a conversation going. Joining us for more on Meta is
Speaker 4: Frank McCourt, junior executive chairman of McCourt Global and founder
Speaker 4: of Project Livity, a movement essentially that aims to make
Speaker 4: the Internet a safer place, but that includes on social
Speaker 4: media platforms. And Frank, let's start very simply with your
Speaker 4: reaction to mister Zuckerberg's letter.
Speaker 2: Yeah, good to see you again.
Speaker 11: I think that we're at a really key moment here,
Speaker 11: and we have seen in the last few months.
Speaker 2: The window shifted. There's a real real change.
Speaker 11: You know, you saw Congress recently best Coosa with overwhelming numbers.
Speaker 11: There's huge judges rolling on a Google and the antitrust.
Speaker 11: I think that there's a real, real sea change here happening,
Speaker 11: and people are fed up with with uh, you know,
Speaker 11: the way the Internet is being used and the way
Speaker 11: these big platforms are exploiting individuals. I see this, quite frankly,
Speaker 11: as a cynical attempt to you know, by Mark to
Speaker 11: you know, uh, to shift the focus from from Facebook
Speaker 11: and Meta and Instagram and all the of the different
Speaker 11: product products of Meta, away from the habits of Meta
Speaker 11: and the exploitive nature of the platform and the fact
Speaker 11: that it's it's it's surveilling you know, millions of Americans
Speaker 11: to being a victim, quite frankly, and I think that
Speaker 11: that's not right.
Speaker 2: It's uh, we we should keep our eye on.
Speaker 11: The ball here and what's really really going on and
Speaker 11: not shift this to a news story about Biden and
Speaker 11: Facebook being a victim.
Speaker 2: I I think it's it's just not correct.
Speaker 4: Well, frank should any administration have the power, if the
Speaker 4: allegations made by Mark Zuckerberg and that letter are correct,
Speaker 4: have the power to put pressure on a specific company
Speaker 4: or social media platform to act on specific content.
Speaker 11: Of course, not in norse should the platforms have the power.
Speaker 11: And this is the whole point of Project Liberty. And
Speaker 11: what we're saying is the look our information, our identity,
Speaker 11: our data, our information, our personal information. This is something
Speaker 11: that is in this day and age, is our virtual being,
Speaker 11: is our personhood, It's who we are. Individuals should be
Speaker 11: deciding what gets how their.
Speaker 2: Content gets used.
Speaker 11: We shouldn't be having these big platforms make these decisions.
Speaker 11: It's it's crazy to have these platforms surveil us, scrape
Speaker 11: our data and then and have this power. We don't,
Speaker 11: of course don't want the government to be able to
Speaker 11: do it. But do we want a few big companies
Speaker 11: to do it either?
Speaker 2: I think not. It's just it's the same end result.
Speaker 2: We just don't We want the power to come back
Speaker 2: to people. Enough is enough on this, but.
Speaker 4: People aren't always great.
Speaker 5: Frank, to be perfectly honest, And when I'm thinking what's
Speaker 5: happening in France for the Telegram co founder and CEO
Speaker 5: he did too little to help protect children. Ultimately, is
Speaker 5: their accusation they allowed the spread of child's sexual abuse material.
Speaker 5: At what point and what line do you draw when
Speaker 5: the companies do need to get involved. That's such a
Speaker 5: hard one to fathom, really.
Speaker 11: Well, Carolyn, your question assumes that the companies are in
Speaker 11: the first instance, surveilling us, scraping our data, collecting it,
Speaker 11: and then we're asking them to do something with all
Speaker 11: that personal information they have. I think we need could
Speaker 11: change how the internet works so individuals have the power
Speaker 11: and they have control of their identity and their data
Speaker 11: and they're not manipulating. You know. What comes to my
Speaker 11: mind here is that we're talking about censorship and how
Speaker 11: this all works, and it it's these algorithms which are
Speaker 11: so powerful. It's we can't be thinking of of censorship
Speaker 11: in an old, pre interate way when these this algorithmic
Speaker 11: behavior that uh in, these algorithms that that are applied
Speaker 11: to this massive amount of our personal data is in
Speaker 11: and this exploitation is happening. Algorithms and censorship, they just
Speaker 11: they're they're.
Speaker 2: At odds with one another.
Speaker 11: The algorithms are preventing us from actually having coherent discussions
Speaker 11: you know, I what what I think about is what
Speaker 11: Jack Dorsey said in Oslo in June. You know, he said,
Speaker 11: too much discussion about free speech and not about but
Speaker 11: not enough discussion about the.
Speaker 2: Lack of free will.
Speaker 11: And Frank, we're all having this, this circular conversation, and
Speaker 11: what's broken is the technology.
Speaker 5: Well, you and Jack Dorsey a line in perhaps seeing
Speaker 5: decentralization as the answer. And you have the project the protocol,
Speaker 5: decentralized social networking protocol, and you want that ultimately to
Speaker 5: be the reworking. That's why you had a bid out
Speaker 5: on TikTok to sort of rework the way in which
Speaker 5: these social media platforms work, can make them decentralized. But
Speaker 5: how would a decentralized social media platform stop inaccurate information,
Speaker 5: the spread of child sexual abuse.
Speaker 11: Well, so, first of all, technology alone is not going
Speaker 11: to stop all bad human behavior. But getting people back
Speaker 11: in charge of their lives, of their virtual self, owning
Speaker 11: their personhood, having agency making decisions is a critical first step.
Speaker 2: Of course, we need to hold people accountable.
Speaker 11: Remember the Internet, Caroline, when it was started, was a
Speaker 11: decentralized piece of technology.
Speaker 2: It was there to connect us and make us smarter.
Speaker 2: It moves civilization forward.
Speaker 11: It only became centralized over the course of the last
Speaker 11: twenty or twenty five years. It's been colonized by a
Speaker 11: few companies. And what is the practice. They scrape our data,
Speaker 11: they surveil us twenty four to seven, and now we're
Speaker 11: asking them to figure out censorship.
Speaker 2: And moderation and so forth. Frank quick the hands of individuals.
Speaker 5: Apologies to cut you off, but very briefly, have have
Speaker 5: you still got money to buy TikTok?
Speaker 4: You still want to buy it.
Speaker 2: We still want to buy it. And because the reason.
Speaker 11: We want to buy it, and I want to make
Speaker 11: it clear, I don't want to be the CEO of
Speaker 11: a social media platform.
Speaker 2: I want to.
Speaker 11: Catalyze this change to this new Internet where individuals own
Speaker 11: and control their data. So we see TikTok as a
Speaker 11: massive opportunity, a fantastic opportunity to bring one hundred and
Speaker 11: seventy million users over to an internet where they're in
Speaker 11: charge of themselves, their identity, and their data, and by
Speaker 11: the way, they receive value for that data as well.
Speaker 11: They're still going to have to be practices and accountability
Speaker 11: for good human behavior. But we don't want the government
Speaker 11: or these big platforms deciding what's good for each of us.
Speaker 4: I don't believe I'm niclette Gina.
Speaker 5: Great to have your the show. We appreciate it. Founder
Speaker 5: at Project Liberty coming up a conversation with the CEO
Speaker 5: of Cribble.
Speaker 4: It's Clint Sharp.
Speaker 5: He's just been leading the company to record break and
Speaker 5: growth since twenty eighteen.
Speaker 4: Data infrastructure startup Cribble announced it's raised a new funding round,
Speaker 4: bringing its valuation to three point five billion dollars. It's
Speaker 4: an unusually high number for a company that's not focused
Speaker 4: exclusively on AI in the current fundraising climate, but there's
Speaker 4: a lot more to it to discuss. Clint Sharp, CEO
Speaker 4: of Cribble, with me on set in San Francisco. I've
Speaker 4: heard so many people say that management of data is
Speaker 4: the key tool of this. There are many names that
Speaker 4: sit within that field, but let's start with the basics
Speaker 4: of what Kribble is and does.
Speaker 12: So we're a data engine for IT and security, which
Speaker 12: is helping customers deal with this massive growth in data.
Speaker 12: Your data is growing in a twenty eight percent compound
Speaker 12: growth rate, and I've asked one thousand customers this question.
Speaker 12: You know, is budget growing at that rate, and the
Speaker 12: answer is universally.
Speaker 5: Now ah, okay, so we're driving the growth, we're looking
Speaker 5: for money, and I'm interested therefore, Clint, where that three
Speaker 5: and a half billion goes to.
Speaker 12: Yeah, so we will be continuing to fund our international expansion,
Speaker 12: product growth, and continued growth in.
Speaker 4: APH specifically.
Speaker 12: So we're really excited to continue to fund our growth
Speaker 12: and global expansion.
Speaker 4: There's a phrase or a term I've not used in
Speaker 4: sometimes centaur status, which is basically marketing speak for I
Speaker 4: think Bessema invented it or coined it. But one hundred
Speaker 4: million dollars or so in and you're recurring revenue upwards.
Speaker 4: That shows some growth. But where do you go from here?
Speaker 4: I mean, I'm assuming that at that valuation things are
Speaker 4: going pretty well in real terms for you.
Speaker 9: Yeah.
Speaker 12: So we're growing from a streaming company into a broad
Speaker 12: spectrum data platform that's helping people deal with it and
Speaker 12: security data which helps them operate the systems that operate
Speaker 12: the business. It's an underserved and so the growth is
Speaker 12: really a reflection of the value we're providing to customers.
Speaker 9: Kent.
Speaker 5: What's so interesting is, of course you're helping streamline data.
Speaker 5: Many would immediately go of course, that's all to do
Speaker 5: with artificial intelligence, But ultimately, is that the near time
Speaker 5: issue of all your clients or are they faced with
Speaker 5: other issues and is it not all about AI?
Speaker 12: So we hear a lot of AI fatigue and our
Speaker 12: customer base, you know, every vendor that's sitting down in
Speaker 12: front of them, every keynote that they go to, is
Speaker 12: all about the technology. And we're embedding AI into our
Speaker 12: technology to help people better understand their data, be able
Speaker 12: to more quickly and easily configure their systems. But they
Speaker 12: want to know what the AI technology is going to
Speaker 12: do for them, as opposed to being about the technology itself.
Speaker 4: I want to date that deeper an AI fatigue, that
Speaker 4: that is something you think is short term or are
Speaker 4: you worried that maybe all of the investment that many
Speaker 4: companies big and small have made was a little bit overdone.
Speaker 12: I mean, I think this is an Internet scale disruption
Speaker 12: in technology. Certainly, I think that.
Speaker 4: But if you look at the.
Speaker 12: Gap between when these trends start and when the value
Speaker 12: starts to be received, there's a pretty big gap in
Speaker 12: that time. And so in that time there's a lot
Speaker 12: of talk about what will happen as opposed to being
Speaker 12: backed by customer success and what value they're actually seeing
Speaker 12: from the technology.
Speaker 4: And so we really focused.
Speaker 12: On making sure that our customers know what exactly we're
Speaker 12: doing for them.
Speaker 5: Well more than three hundred million to go spend three
Speaker 5: and a half billion dollar valuation, We appreciate and coming
Speaker 5: on to talk and see the business. Cribble CEO Clint
Speaker 5: Sharp meanwhile at the money for some like Cribble, but
Speaker 5: not for others, particularly for the movement to diversify Silicon
Speaker 5: Valley and technology. More broadly, groups like Girls in Tech
Speaker 5: and Women who Code, they're closing up shop, while other
Speaker 5: not for profits are trying to rebrand their efforts to
Speaker 5: just stay afloat. Adriana Gascoyne, founder of Girls in Tech,
Speaker 5: joins us now to discuss Adriana, you've had to unwind
Speaker 5: the not for profit that you built.
Speaker 4: Why it's a tragedy.
Speaker 9: I built at seventeen years ago and it was a
Speaker 9: huge need then, it's still a huge need now. I
Speaker 9: truly believe diversity is crucial. Having diverse workforces is crucial
Speaker 9: in developing the most optimal, amazing, innovative technology products and services.
Speaker 9: And in two thousand and seven, there was such a
Speaker 9: disparity of our gender in the tech space, and so
Speaker 9: I wanted to launch an organization that would encourage and
Speaker 9: empower women to take risks and enter into the field.
Speaker 9: It's an amazing, amazing field. I learned so much. I
Speaker 9: feel like we were growing and building such so many
Speaker 9: amazing products and services. I wanted women to be a
Speaker 9: part of that.
Speaker 11: Right.
Speaker 9: I was one of thirty five employees back in two
Speaker 9: thousand and seven, and I was the only woman, and
Speaker 9: I was the only woman person of color, And so
Speaker 9: I knew that when I launched the organization, the goal
Speaker 9: was to get to create awareness, get more women involved
Speaker 9: and talk to them, meet them, see them, hear their stories,
Speaker 9: encourage people to sort of reach for the stars and
Speaker 9: launch their own businesses. Move to the ladder b CEOs.
Speaker 9: So you know, seventeen years later, we're in thirty five countries.
Speaker 5: But Adriana, you've got the scale. But why you then
Speaker 5: closed because money turned off? Why are people no longer
Speaker 5: funding your business? Your company are not for profit?
Speaker 4: Correct?
Speaker 9: Money turned off? I would say twenty twenty three was
Speaker 9: probably the hardest fundraising year for US in record. Over
Speaker 9: the last seventeen years, and I think it started with
Speaker 9: COVID issues, people closing their doors, businesses closing their doors.
Speaker 9: Then it turned into high tech layoffs, budget cuts, re orgs,
Speaker 9: and then it turned into the BLM movement. Believe it
Speaker 9: or not. Even though we support people of all backgrounds
Speaker 9: and races and genders, we want to make sure we wanted,
Speaker 9: we needed funding and a lot of the corporate funders
Speaker 9: ended up going to organizations that focus on the black population. Uh,
Speaker 9: and so we lost out on some of that funding.
Speaker 9: And then it turned into sort of.
Speaker 4: The D and I backlash.
Speaker 9: So during the high tech layoff issue in reorbs where
Speaker 9: companies were freezing their dollars, they were also realizing that
Speaker 9: in many cases D E and I policies, training programs,
Speaker 9: initiatives were not working. And so there was a huge
Speaker 9: group of D and I executives at Fortune five hundred
Speaker 9: companies that were getting laid off and then as a result,
Speaker 9: the budgets closed as well, which hurt us.
Speaker 4: Adriana Gascoyne, founders of Girls in Tech.
Speaker 5: Thank You, Amazon is making a three one hundred million
Speaker 5: dollar bet on the Kelsey Brothers and fl squars. Travis
Speaker 5: and Jason Kelsey will join Amazon's Wondering with that podcast
Speaker 5: New Heights you Most. Chris Palmry joins us with the details.
Speaker 5: Hot on the Heels are the corner Daddy deal that
Speaker 5: we saw with Sirius XM. Now it's kind of the
Speaker 5: antithesis kind of a podcast took us through why the
Speaker 5: number is so high?
Speaker 13: Well, this is kind of sort of amazing thing about
Speaker 13: the podcast industry. So last year, the big story was retrenchment.
Speaker 13: Everyone was canceling shows, Companies were getting sold, people were
Speaker 13: being laid off. This was after a few boom years
Speaker 13: where people were just throwing money at podcasts, and now
Speaker 13: twenty twenty four, it's an entirely different story. And what
Speaker 13: we're seeing is kind of the winners of just being
Speaker 13: paid exorbitant sums. So certainly the Kelsey brothers the latest,
Speaker 13: but as you mentioned, Alex Cooper, Joe Rogan, all these
Speaker 13: people were renewed their contracts at very fat prices and
Speaker 13: so so you know, these are all the big media companies.
Speaker 13: In some cases they're changing you know, who's you know,
Speaker 13: distributing the show, and they're paying up for the top talent.
Speaker 4: I'm a listener of New heights. I'm sure that Travis
Speaker 4: and Jasons to the Bloomberg Technology podcast. I'm certain that
Speaker 4: they do. The deal details are pretty interesting. You know,
Speaker 4: Wondering is going to do a lot for distribution. There's
Speaker 4: an advertising component. Somebody did them a good deal.
Speaker 13: Yeah, and not just the traditional stuff like you mentioned,
Speaker 13: you know, ad sales, it's merchandise.
Speaker 4: It's really kind of a wrap around deal, which.
Speaker 13: You know, given the sum one hundred million dollars over
Speaker 13: three years, Yeah, you'd expect Amazon would and they're Wondering
Speaker 13: Subsiria would want something out of this, yeh. But you
Speaker 13: know this is you know, this is everyone's trying to
Speaker 13: bundle these premiere podcasts into their services, and so this
Speaker 13: is this is you know, everyone is trying to get
Speaker 13: a piece of every part of the deal, and they're all.
Speaker 5: Trying to get a piece of the elephant in the
Speaker 5: room that is Taylor Swift.
Speaker 4: Chris.
Speaker 5: This is why the podcast suddenly got a jump as well.
Speaker 4: For sure.
Speaker 13: I mean it started in twenty twenty two, you know,
Speaker 13: it was doing okay, but really took off last September
Speaker 13: when Travis and Taylor announced they were dating and she
Speaker 13: started peering at games and you know, a huge surgeon in.
Speaker 4: Viewership after that.
Speaker 13: And I'm sure you know a lot more women than
Speaker 13: I would probably normally listen to this podcast too, So
Speaker 13: you know, it's it's definitely another part of the Swift universe.
Speaker 4: Chris in fifteen seconds, tell me what's happening with Paramount.
Speaker 13: Well, the bidding war part of it is over. Edgar
Speaker 13: Bromfin dropped out and it looks like David Ellison will
Speaker 13: move forward with his deal supposed to close in the
Speaker 13: first half of next year. But you know, we're never
Speaker 13: out of the woods quite with Paramount. There'll be probably
Speaker 13: lawsuits and regulatory issues.
Speaker 4: Bloomber's Chris Pound, Mary, our entertainment editor, thank you.
Speaker 5: That does it for this rather busy edition of Bloomberg Technology.
Speaker 5: Big day tomorrow.
Speaker 4: Yeah, coming up tomorrow we have a special edition of
Speaker 4: Bloomberg Technology featuring an exclusive interview with Nvidia CEO Jensen
Speaker 4: Woks thirty pm Eastern Time. This has been back Technology