Speaker 1: From the heart of where innovation, money and power colli
Speaker 1: in Silicon Valley and beyond. This is Bloomberg Technology with
Speaker 1: Emily Jay I'm Emily changing San Francisco in this Bloomberg
Speaker 1: Technology coming up in the next hour. Elon Musk tries
Speaker 1: to back out of the billion dollar Twitter deal again.
Speaker 1: Turner projects him again. All this a day before the
Speaker 1: whistleblower is scheduled to testify on Capitol Hill. How could
Speaker 1: that change? The trial will discuss claus streaming platforms going
Speaker 1: all out for sports broadcast rights, a conversation with Amazon's
Speaker 1: global sports video vice president on its big ticket deal
Speaker 1: for Thursday Night football, and Morley some making bets on
Speaker 1: the blockchain and n f E t startup backed by
Speaker 1: Serena Williams just got a big deal with the NBA.
Speaker 1: We're going to talk to a top execut at so
Speaker 1: rare later this hour. All of that in a moment,
Speaker 1: but first, let's talk a little bit more about Twitter.
Speaker 1: Musk now Twitter rejecting that latest effort to cancel the
Speaker 1: deal yet again, saying it's quote invalid and wrongful. His
Speaker 1: third attempt to walk away from this deal and third
Speaker 1: times not the charm that whistleblower former Twitter employee Peter
Speaker 1: zat co A K A. Mudge, testifies before the Senate
Speaker 1: Judiciary Committee Tuesday. Here discuss s Bloomberg's Jeff Feely in Wilmington, Delaware,
Speaker 1: and Alex Barnka in San Francisco. So, Alex, first of all,
Speaker 1: what are we expecting to hear from Peter zat COO
Speaker 1: on Capitol Hill tomorrow? Yeah, so I think that that
Speaker 1: the hearing tomorrow will probably follow two lanes of conversation.
Speaker 1: There'll be questions around the data privacy concerns, around the
Speaker 1: bots and fake at counts that Zacho has alleged that
Speaker 1: the company either ignored or didn't disclose. But I also
Speaker 1: expect the Senate Judiciary Committee to focus on some more
Speaker 1: of the data privacy issues that legislators care about. Um
Speaker 1: that might be a little less relevant to the acquisition,
Speaker 1: but increasingly relevant as d C has been able to
Speaker 1: push through antitrust legislation but has not gotten a lot
Speaker 1: of traction on data privacy, So they might take this
Speaker 1: opportunity to lean into some of those themes as well. Now,
Speaker 1: Jeff Elon Musk is trying to use new information that
Speaker 1: Twitter signed a seven million dollar separation agreement with Peter
Speaker 1: zach Co back in June. Must trying to use that
Speaker 1: as a reason to cancel the deal. You know what
Speaker 1: exactly is he trying to say here, Well, he's basically
Speaker 1: saying that that payment constituted something outside the ordinary course
Speaker 1: of business. When you have these buyout agreements going on,
Speaker 1: one of the provisions it's often in there says that
Speaker 1: the seller has to continue to run the business in
Speaker 1: the ordinary course. Mr musk contention is this seven million
Speaker 1: dollar severance payment was somehow tied to silencing Mr Zacho
Speaker 1: so that he would not bring forth his his complaints publicly,
Speaker 1: so that that, he claims, is another reason that there's
Speaker 1: been a material adverse event and he should be able
Speaker 1: to cancel the deal. It don't sound like a lot
Speaker 1: of money, seven million dollars to get this guy to
Speaker 1: go away, Alex and then he ends up, you know,
Speaker 1: blowing the whistle. Anyway, Can you tell us a little
Speaker 1: bit more about what happened here between Zacho and Twitter? Yeah, Emily,
Speaker 1: the sticker shark that you're having might be some of
Speaker 1: the reason why Musk feels like he can lean into
Speaker 1: this as an argument that um, this type of settlement
Speaker 1: should have been brought to his camp and his outside
Speaker 1: the regular course of business. So this was a guy
Speaker 1: who was an executive on the security side, was brought
Speaker 1: in um number of years back and oversaw a lot
Speaker 1: of the important kind of security pieces and the teams
Speaker 1: that worked on those things internally at Twitter. So um,
Speaker 1: he is a person who you know, claims that he
Speaker 1: has kind of insider knowledge on this. The company says, well, look,
Speaker 1: you could have actually made some changes on these things.
Speaker 1: So there's an interesting um kind of back and forth here, Emily,
Speaker 1: I will point out, Um, it has been reported that
Speaker 1: in that settlement agreement he was still allowed to blow
Speaker 1: the whistle um to to govern to the government if
Speaker 1: there were any issues. So um, seven million dollars definitely
Speaker 1: sticker shock um definitely Uh that kind of third strike
Speaker 1: that Ellen is claiming allows him to get out of
Speaker 1: the deal. Um, but did leave that door open for
Speaker 1: us to hear from Peter Zacho tomorrow morning. Now Jeff
Speaker 1: has to judge weigh in on this latest request from
Speaker 1: Musk and this latest information about the separation agreement, and
Speaker 1: if not, what are we going to hear from her? Well,
Speaker 1: the judge has allowed Mr Musk to amend his counterclaims
Speaker 1: in the case to add the whistleblowers allegations. I want
Speaker 1: to point out that the seven million dollar payment may
Speaker 1: be contractual. We do not know if this was per
Speaker 1: a severance agreement with Mr Zach Coo, so I wouldn't
Speaker 1: automatically recoil at the seven million dollar number. We still
Speaker 1: need to find out what that's all about. I doubt
Speaker 1: we're gonna learn that tomorrow either. So how are you
Speaker 1: expecting this testimony from Zach Coo tomorrow to be folded
Speaker 1: into the case that, of course was building up to
Speaker 1: this child coming up in mid October. Jeff his his
Speaker 1: testimony tomorrow about the national security stuff and potential spies
Speaker 1: within Twitter's employee uh group are the things that the
Speaker 1: senators are gonna be focusing on. The folks that that
Speaker 1: we're concerned about is going to be his his allegation
Speaker 1: that he raised the question of at how many spam
Speaker 1: and robot accounts were embedded within the customer base and
Speaker 1: the Twitter his colleagues lack of interest in finding that out.
Speaker 1: That's the key question in the trial coming up, because
Speaker 1: that's where Mr Musk has put all his chips. In
Speaker 1: terms of defense arguments, well, clearly both parties are gonna
Speaker 1: be watching this, this testimony with bated breath, Uh, Alex
Speaker 1: any word from Twitter about the latest salvo or how
Speaker 1: any of this potentially changes their plans. So they basically
Speaker 1: came out and said, look, we don't buy the argument
Speaker 1: that the separation agreement um is a viable excuse. UM.
Speaker 1: I know that the Twitter camp will also be watching
Speaker 1: this very closely as well a lot of the shareholders
Speaker 1: who are potentially making their voices heard in the shareholder
Speaker 1: vote tomorrow. UM. I would think if things go really
Speaker 1: far down the line of privacy concerns, if there's a
Speaker 1: lot of kind of intra us in the data security
Speaker 1: piece that are unrelated to the acquisition, that would just
Speaker 1: be another thing to add to the list of Twitter
Speaker 1: CEO is kind of big ticket items to care about.
Speaker 1: Twitter has not been brought into d C as often
Speaker 1: as a lot of the larger social media appears. UM.
Speaker 1: So I think, uh, internally, you could argue there's a
Speaker 1: lot of distractions going on at the company right now,
Speaker 1: and if they do get some traction UM. In terms
Speaker 1: of legislators arguments that data privacy should be more important
Speaker 1: than Emily. I would add that to the list of
Speaker 1: kind of some of these ancillary concerns that are outside
Speaker 1: of just operating the business. All right, Alex Brenka Jeff Phey,
Speaker 1: continuing to cover this evolving legal drama for us. Thank
Speaker 1: you both for joining us. Meantime, a story that we
Speaker 1: continue to watch. Intel is scaling back expectations for its
Speaker 1: mobile i i p O. According to Bloomberg sources, the
Speaker 1: move could delay the share sale until next year if
Speaker 1: market conditions don't improve. Intel expects the i p about
Speaker 1: to value the self driving tech business as much as
Speaker 1: thirty billion dollars. Warders and others reported earlier potential valuations
Speaker 1: of more than fifty billion dollars. All right, coming up,
Speaker 1: how Amazon and other streaming giants are disrupting one of
Speaker 1: the bastions of traditional television, that is sports broadcasting. Right
Speaker 1: to top, Amazon executive with us next. This is Bloomberg.
Speaker 1: It is a historic week for sports broadcasting. This Thursday,
Speaker 1: Amazon Prime Video kicks off in eleven year thirteen billion
Speaker 1: dollar deal. This is the first time a streaming service
Speaker 1: has had exclusive rights to NFL games in the United States,
Speaker 1: and a big challenge to major networks. Amazon told advertisers
Speaker 1: it expects an average audience of twelve point six million
Speaker 1: viewers per game. This according to The Wall Street Journal.
Speaker 1: Vice President of Amazon Global Sports Video Marie john A.
Speaker 1: Hue is the architect of Amazon's Lives Force ambitions, and
Speaker 1: she joins us now to discuss So a huge week
Speaker 1: Marie for Amazon. Uh and for the first time, fans
Speaker 1: are gonna have to log onto Amazon Prime Video to
Speaker 1: see this big game on Thursday nights. Does this seem
Speaker 1: like a turning point to you in sports broadcasting? Absolutely?
Speaker 1: I mean, I look, honestly, I think this will be
Speaker 1: as big as when the NFL went to cable back
Speaker 1: in nine seven. You know, we know how NFL games
Speaker 1: legitimized and grew the cable cable business, and we think
Speaker 1: the same thing can happen for streaming. So you lead
Speaker 1: negotiations for this thirteen billion dollar, eleven year deal. It
Speaker 1: is a massive deal. How did you convince the NFL
Speaker 1: that Amazon was the place to be, right, Well, you know,
Speaker 1: the NFL cares important, cares a lot about scale and reach,
Speaker 1: and we've got that. We've got that better than any
Speaker 1: better than any other's dreaming service. They also care about production,
Speaker 1: and they knew we we showed in Europe and we
Speaker 1: also showed by our work in the US that we
Speaker 1: can produce the best broadcast for fans. It's incredibly important
Speaker 1: to them and one of the most exciting things for
Speaker 1: me is they care about innovation. You know, the the
Speaker 1: NFL has been able to stay top of mind for
Speaker 1: sports fans for decades because they innovate and they move
Speaker 1: forward and they have that confidence and that that's the
Speaker 1: biggest That was one of the biggest tenants in our
Speaker 1: deal with the NFL. We agreed to push each other
Speaker 1: and to continue to push each other on innovating on
Speaker 1: behalf of sports fans, and it's something that's personally really
Speaker 1: exciting and and something that really excites the team. What
Speaker 1: are your goals with audience numbers? I understand we've got
Speaker 1: this Wall Street Journal number that you're expecting twelve point
Speaker 1: six million viewers. Is that correct? Um? I also understand
Speaker 1: the typical viewership is more like sixteen and a half million.
Speaker 1: Are you hoping or thinking that you can get there
Speaker 1: or bigger? Right? Well, you know, our number one focus
Speaker 1: is delivering the absolute best broadcast for fans and the
Speaker 1: trends are in our favor. Everyone knows that more and
Speaker 1: more fans, particularly sports fans, are moving to streaming. Thinks
Speaker 1: this won't happen overnight. This is an eleven year deal,
Speaker 1: but we feel really strongly that if you start with fans,
Speaker 1: you serve the fans, they will come. And so we're excited.
Speaker 1: We we had our preseason game two weeks ago and
Speaker 1: the reaction from fans was just fabulous, and we're really
Speaker 1: excited to get on the field this Thursday. Thursday, the
Speaker 1: Chargers taken on the Kansas City Chiefs. UM. Talk to
Speaker 1: us then about how this benefits Amazon more broadly. You
Speaker 1: know what what's gonna be your measure of success. Is
Speaker 1: it driving audience numbers? Is it driving more Prime memberships?
Speaker 1: Is it getting more customers to buy more Amazon products? Yeah? Absolutely,
Speaker 1: So I hate to sound repetitive, but at Amazon, we
Speaker 1: start with customers. I call them sports fans, and so
Speaker 1: number one, we think we serve sports fans better. We
Speaker 1: can serve customers better. But if we wouldn't be in this,
Speaker 1: if we didn't think we could improve the experience and
Speaker 1: make it better for fans. But absolutely, as you said, Emily,
Speaker 1: they're great business opportunities here. Number one, we're Prime. Prime
Speaker 1: Video is a membership service, so we can attract more
Speaker 1: members to Prime. There are plenty of people who have
Speaker 1: Prime who maybe have don't even haven't streamed video on
Speaker 1: Prime Video. And then there are other folks who come
Speaker 1: in for Thursday night football and find things like Lord
Speaker 1: of the Rings. So we think, particularly in the Prime
Speaker 1: membership opportunity is huge. We think that opportunity is huge
Speaker 1: for us. And you know, we haven't even talked about advertising.
Speaker 1: You know, advertising, This is a game change for advertising
Speaker 1: for at Amazon. We have a very strong business already,
Speaker 1: but you can't beat this is the most premium video
Speaker 1: advertising inventory out there. So it's a huge game changer
Speaker 1: for us in terms of advertising. So how do you
Speaker 1: plan to leverage targeted advertising and do some things differently
Speaker 1: that maybe a traditional network wouldn't be able to do
Speaker 1: given all of the data and other ways you have
Speaker 1: to reach your customers? Right, Well, I would start with
Speaker 1: you know, we've done a deal with Nielsen, so we
Speaker 1: we actually are the first streamer to do a deal
Speaker 1: with Nielsen, so we'll have ratings every week. So we
Speaker 1: think that's really important because that is what advertisers and
Speaker 1: the industry follows or Nielsen ratings. On top of that,
Speaker 1: as you say, we have first party data, and we'll
Speaker 1: use that data not only to measure our fans and
Speaker 1: to and and to serve to serve them better, but
Speaker 1: also to serve advertisers better. We can actually use that
Speaker 1: first party data to make the advertising more relevant, more targeted,
Speaker 1: more directed. So it's an incredible opportunity. Now talk to
Speaker 1: us about the experience. Is there gonna be a pregame show,
Speaker 1: a halftime show, sideline reporters. How is this going to
Speaker 1: be different than a traditional network at spirit? Right? So,
Speaker 1: so first of all, we start, we start with the basics.
Speaker 1: We have the best broadcast. We think we will have
Speaker 1: the best game broadcast in the business. I mean, well,
Speaker 1: I've been in sports twenty years and you always have
Speaker 1: to remember it starts and ends with the game. So
Speaker 1: we've got iconic broadcasters like Al Michael's and Kirk curb Street.
Speaker 1: We've got Kayleie hard Tongue on the sidelines. This will
Speaker 1: be the absolute broadcast. We've got more cameras than anybody.
Speaker 1: So when you turn on your big screen television or
Speaker 1: whatever device, were on every piece of glass. Whatever you
Speaker 1: watch the game, you can sit back and relax and
Speaker 1: enjoy that huge, big screen experience. But on top of that,
Speaker 1: as you mentioned, Emily, we're we're no t T service,
Speaker 1: so we're not satisfied with that. The bar for us
Speaker 1: is really high. We want to innovate, so we're going
Speaker 1: to offer all sorts of innovation and custom customized experience
Speaker 1: for fans. Will have alternate feeds. You can watch the game,
Speaker 1: you can sit down and watch with your family and
Speaker 1: watch the dudes Dude perfect, or you can go, you
Speaker 1: can um and you can explore our x ray experience,
Speaker 1: which is actually without ever leaving the game, you can
Speaker 1: see all sorts of data and statistics and replays. The
Speaker 1: point of Extray is actually to put the tools that
Speaker 1: normally have to wait for a producer or director to say,
Speaker 1: oh let me see that replay, let me show you
Speaker 1: some extra stats. We're going to put that in the
Speaker 1: hands of fans. And then, of course we have all
Speaker 1: the content around the game, so we have pregame, post game,
Speaker 1: we'll have a great late night show, and we've got
Speaker 1: the best the best talent in the business there. We've
Speaker 1: got Charissa Thompson we've got Hall of Famer Tony Gonzalez.
Speaker 1: We've got two guys right off the field, Richard Sherman
Speaker 1: and Ryan Fitzpatrick. They're going to be amazing the conversation
Speaker 1: these guys have. They were on the field with these
Speaker 1: guys just last year, so they'll take fans literally inside
Speaker 1: the thinking of the players on the field. And we've
Speaker 1: got a great surrounding cast. And then we've got we're
Speaker 1: also going to offer the game and the programming on Twitch.
Speaker 1: Remember we have Twitch, which is an incredibly young, incredibly young,
Speaker 1: um interactive audience, and you know, Twitch is all about
Speaker 1: watching with your community, So we're excited we're going to
Speaker 1: expand the communal nature of sports through Twitch. And then
Speaker 1: on top of it, we've got some shows during the
Speaker 1: rest of the week, so we are going to surround
Speaker 1: fans all week. And as you can tell from my excitement,
Speaker 1: we're we're just thrilled to get going. You know, I
Speaker 1: assume you've got some contingency plans, you know, are you
Speaker 1: sure all cable fans are gonna be able to find
Speaker 1: the game? Are you planning for any kind of onboarding
Speaker 1: issues or an on slot of onboarding issues? Potentially absolutely,
Speaker 1: So we were on every piece of glass, as I mentioned,
Speaker 1: and if you come to any Amazon service, you're not
Speaker 1: going to be able to miss this game, and it'll
Speaker 1: be seamless and it will be easy. But also we've
Speaker 1: got great third party marketing to to also help you.
Speaker 1: But of course we're prepared. We've done this in Europe,
Speaker 1: we've done this in other places in the US. We
Speaker 1: actually have all sorts of online tools, and we're old school.
Speaker 1: We also have phone numbers you can call, and we
Speaker 1: actually put extra people on hand because we know that
Speaker 1: it's incredibly frustrating when you call the sometimes when you
Speaker 1: call those services and you don't get an answer. We
Speaker 1: will have literally thousands of people ready to take those
Speaker 1: phone calls if needed. So we're incredibly excited. We've been
Speaker 1: preparing for this for years. This is really hard work
Speaker 1: and it's really complicated, and we've been building at it,
Speaker 1: building towards it for years. We think we're the company
Speaker 1: and the best, with no other companies in position to
Speaker 1: serve a game like this to a concurrent, concurrent audience
Speaker 1: like we're going to experience this season. So the big question,
Speaker 1: of course, then is what next is Amazon planning to
Speaker 1: bid on any of the remaining college sports rights or
Speaker 1: the NBA. What else do you have coming? Well, obviously
Speaker 1: I can't talk about specifics, but what I can tell you,
Speaker 1: Emily is we approach everything from the sports fan perspective.
Speaker 1: So the first thing we do is we say, how
Speaker 1: do fans consume this content? Is there a way we
Speaker 1: can do better? Is there a way we can serve
Speaker 1: those fans better? And of course then what can we
Speaker 1: do differently and does it make sense for us? So
Speaker 1: there's literally I can't really think of any sports rights
Speaker 1: we don't look at. I mean, we're in business with
Speaker 1: the NFL, We're in business with the Yankees. You know,
Speaker 1: we provide local games exclusively in New York. So we're excited.
Speaker 1: The partners who are willing to come with us are
Speaker 1: the ones who are forward focused, fan focus and really
Speaker 1: want to go as you know, the old Wayne Gretzky
Speaker 1: want to go where the puck is going, not where
Speaker 1: it's been. So last quick question, I know you used
Speaker 1: to work at ESPN. Amazon has a huge content budget.
Speaker 1: I wonder if you're also thinking about making new sports content.
Speaker 1: You know, I believe you were involved in the thirty
Speaker 1: for thirties series, um you know, and and maybe original
Speaker 1: sports documentaries and other ways that you can build out
Speaker 1: Amazon as a big player in where you go to
Speaker 1: see things about sports. Absolutely, so we've already started that. Emily.
Speaker 1: We've got a series All or Nothing that we've done
Speaker 1: in the US and Europe. We've got great, great success
Speaker 1: with that, and actually five months ago we started a
Speaker 1: separate sports group in my group. We're hiring or staffing
Speaker 1: up if anybody in a young filmmakers out there want
Speaker 1: to come work with us. So we're excited. We think
Speaker 1: when you have those that additional content, not only is
Speaker 1: it valuable on its own, we have a high bar
Speaker 1: we wanted to be excellent content, but it also engages
Speaker 1: fans more with the athletes and the teams that then
Speaker 1: we show on live events. It's a really great um
Speaker 1: ecosystem to get going. And we we we found that
Speaker 1: in Europe when we have are all or nothings on
Speaker 1: the Premier league teams, we notice that those fans understand
Speaker 1: and appreciate those players and those teams even more when
Speaker 1: they understand what they've gone through and seen behind this
Speaker 1: and and seen behind the scenes. All right, Uh, Marie Donnie,
Speaker 1: who I believe I got You've got to catch a
Speaker 1: flight to Kansas City. UM, so thank you so much
Speaker 1: for joining us. Amazon Global Sports Video Vice President and
Speaker 1: excited to see how it all shakes out. On Thursday,
Speaker 1: Early indicators suggest Apple's iPhone fourteen pre orders are stronger
Speaker 1: than expected. Pre order data showing that the iPhone fourteen
Speaker 1: Pro Max is the best selling model, and orders for
Speaker 1: the iPhone fourteen or tracking slightly ahead of the iPhone thirteen.
Speaker 1: Web Bush saying it's seeing strong demand trends and estimates
Speaker 1: two forty million of the one billion total I phone
Speaker 1: users haven't upgraded their phones in nearly four years. Apple
Speaker 1: shares popping on the news the most since coming up.
Speaker 1: Micron breaking ground on a new fab in Idaho. CEO
Speaker 1: San j me Rotra with us next. Welcome back to
Speaker 1: Bloomberg Technology. I'm Emily Chang in San Francisco. Trevor Milton,
Speaker 1: the founder and former executive chair of Nicola, went on
Speaker 1: trial starting this week, charged with Lyne about the company's
Speaker 1: products to mislead investors and prop at the stock Let's
Speaker 1: get back to New York and Bloomberg's at Ludlow, who
Speaker 1: was in court today for the first stages. Ed what happened? Yes,
Speaker 1: So Trevor Milton faces two counts of securities fraud, two
Speaker 1: counts of y fraud, and you're right, m that prosecutors
Speaker 1: have to prove that a Trevor Milton lied about the
Speaker 1: company's technology and its products, and that in so doing
Speaker 1: he misled investors and also therefore the investors made the
Speaker 1: choice to invest in his company, Nicola, based on the information.
Speaker 1: He arrived Monday morning Southern Districts of New York here
Speaker 1: in Manhattan for the trial, which was supposed to take
Speaker 1: place in July, but Judge Egardo Ramos granted the delay
Speaker 1: until September twelve, Monday, so that they could take on
Speaker 1: that fourth count of wire fraud. It's a five week trial,
Speaker 1: so we started Monday with jury selection. Tuesday, we expect
Speaker 1: opening arguments, with the prosecution having around three weeks present
Speaker 1: their evidence, and then the defense will come in and
Speaker 1: the burn of proof is on the prosecution here. This
Speaker 1: trial could run for around five weeks through the end
Speaker 1: of October, and as they say, the focus for the
Speaker 1: prosecution is convincing the jury that a Trevor Milton lied,
Speaker 1: misled investors. About the company's progress, it's technology, what it
Speaker 1: had actually achieved, but also the investors, retail investors in
Speaker 1: particular were moved or motivated to invest in the stock
Speaker 1: for that reason. You remember it. It's Pete. This was
Speaker 1: the poster child back wave of ev companies went public,
Speaker 1: virus back, and at one point it had a market
Speaker 1: cap rating them forward, things are very different now and
Speaker 1: all right, Ad Ludlow, thank you. Will continue to wait
Speaker 1: for your updates as the child progresses. Meantime, Micron just
Speaker 1: broke ground on a new memory manufacturing fab in Boise, Idaho,
Speaker 1: the first of its kind in the US in twenty years.
Speaker 1: The chip maker plans to invest roughly fifteen billion dollars
Speaker 1: on the plan over the next several years, making it
Speaker 1: the largest private investment ever made in the state. I
Speaker 1: caught up with Micron CEO Sandre ma Rotra in an
Speaker 1: exclusive interview earlier. Take a listen to what he had
Speaker 1: to say. We have been are research and development technology
Speaker 1: leader from Boise for decades and now being able to
Speaker 1: combine it with leading edge memory manufacturing technology. This will
Speaker 1: just accelerate time to market of new technologies, new solutions
Speaker 1: for the benefit of the customers as well as of
Speaker 1: course driving US leadership and semiconductor technology. So this is
Speaker 1: a big day. This is a big announcement. And this
Speaker 1: is enabled by Chips Act, which was just signed by
Speaker 1: President by it in a month ago, because that is
Speaker 1: really important in terms of leveling the playing field. So
Speaker 1: this is very exciting. It will bring seventeen thou jobs
Speaker 1: here in Idaho over the course of the rest of
Speaker 1: the decade. We will be starting production sometime in TWI
Speaker 1: of course, construction to start some time in twenty twenty three,
Speaker 1: and this will be transformative and we'll be bringing on
Speaker 1: production of course in line with the industry's demand. Now
Speaker 1: Micron of course already has many plants across Asia. How
Speaker 1: does this impact operations globally? Does this mean you'll always
Speaker 1: consider building in the US? First, of course, we have,
Speaker 1: as you noted, well diversified footprint across Asia for our manufacturing.
Speaker 1: And again chip SACKED now enables the leveling the playing
Speaker 1: field whereby now the production can become cost effective with
Speaker 1: the support of grants from Chips and investment tax credits.
Speaker 1: So of course we will continue to invest in our
Speaker 1: plans in Asia as well. But when we look at
Speaker 1: the demand for memory. By twenty thirty timeframe, semiconductor memory
Speaker 1: demand is expected to double in terms of revenue opportunity.
Speaker 1: That requires new way for capacity. That's why we started
Speaker 1: this plant here, announced this plant here, and actually had
Speaker 1: the ceremony that launches the construction for this plant. Uh.
Speaker 1: And this will basically enable us. This will basically enable
Speaker 1: us to meet the growing demand for the era for
Speaker 1: semi conductive memory technology. Of course, we'll keep investing in
Speaker 1: technology transitions in our overseas plans as well. Is the
Speaker 1: money that's been set aside by the US government enough
Speaker 1: others have called it a start. That's right, it's a
Speaker 1: good start. And the support in terms of CHIPS grants
Speaker 1: as well as investment tax credits will help US level
Speaker 1: the playing field with foreign governments which have been supporting
Speaker 1: investments in semiconductors in their countries for a very long time.
Speaker 1: Of course, companies like Micron will continue to invest from
Speaker 1: their operating cash flow as well as from the balance sheet,
Speaker 1: and of course big part of the investments will come
Speaker 1: from Micron, but the CHIPS grants are absolutely essential. Without chips,
Speaker 1: we would not have been able to make this investment.
Speaker 1: This announcement today, Do you have any concern and that
Speaker 1: it's governments and not market forces setting the agenda for
Speaker 1: what is needed and that that could down the line
Speaker 1: create excess capacity. It is extremely important as and as
Speaker 1: I noted earlier, that we will be bringing on production
Speaker 1: in the future in line with the industry demand projections,
Speaker 1: the end market demand projections, and of course each of
Speaker 1: the companies that is bringing their own semiconductor production up
Speaker 1: will be managing, should be managing, and I can speak
Speaker 1: for Micron, we will of course be managing with discipline
Speaker 1: our supply growth, keeping an eye on demand growth and
Speaker 1: keeping them balanced to the best of our abilities. Now,
Speaker 1: you and Micron warned about slowing demand about a month ago,
Speaker 1: which triggered a broader concern about a slump across the
Speaker 1: chip industry overall, What can you tell us about demand
Speaker 1: as you see it now? Is it indeed slowing down?
Speaker 1: And if so, how much this is for the memory industry,
Speaker 1: for the semi conductive memory industry. This is a challenging
Speaker 1: environment primarily driven by inventory adjustments that our customers across
Speaker 1: various end markets are making, and that's really impacting the
Speaker 1: industry demand and supply balance. Of course, we have taken
Speaker 1: actions in this regard in terms of adjusting our supply
Speaker 1: growth plans for the future. But you know um Emily
Speaker 1: very well that in semiconductors actions taken it takes a
Speaker 1: while before the results are achieved. So it will take
Speaker 1: us few quarters before I believe industry demand and supply
Speaker 1: and balance will be restored. But what's important here is
Speaker 1: what we're announcing today is about the long term future.
Speaker 1: The demand drivers for long terms AI five G, autonomous
Speaker 1: and of course across data center, industrial automotive. Those demand
Speaker 1: drivers in terms of consumption of memory requirements for the
Speaker 1: long term or intact and that's why to meet that
Speaker 1: growing demand requirement of the future, investments need to be
Speaker 1: made now because there's a long lead time to build
Speaker 1: these fabs and the production will only start in the
Speaker 1: second half of this decade and it will of course
Speaker 1: be managed in line with the demand projections for the future.
Speaker 1: So clearly a huge step for Micron breaking ground on
Speaker 1: this fab today. I'm curious what you think this means
Speaker 1: for the broader industry though, if demand is slowing or
Speaker 1: you know, at least for a few quarters, as you say,
Speaker 1: how long do you think we could be in a
Speaker 1: cycle of oversupply, you know, not just where Micron is concerned,
Speaker 1: but across the broader chip industry. So look in mentory
Speaker 1: adjustments take a while to work through the system, and
Speaker 1: I can tell you that memory industry tends to be cyclical.
Speaker 1: But what's important is that the health of the memory
Speaker 1: industry is really ultimately driven by long term demand trends.
Speaker 1: And I think that's important that as near near term
Speaker 1: perturbations take place due to factors such as inventory adjustments,
Speaker 1: actions are taken fast to bring demand and supply in balance.
Speaker 1: But of course it takes a while, it takes a
Speaker 1: few quarters for their demand supply to get im balance.
Speaker 1: But important thing is that actions that are taken fast.
Speaker 1: We are being responsive in that regard, but we are
Speaker 1: also managing for the long haul, the lo the long
Speaker 1: haul in terms of the growing demand needing more investments
Speaker 1: in order to meet the requirements of our customers. As
Speaker 1: we look ahead to the second half of this decade,
Speaker 1: there's of course been a lot of talk about the
Speaker 1: competition between the US and China on this front. Just
Speaker 1: how big is China in the memory market in particular,
Speaker 1: and is it's something that the US government should be
Speaker 1: concerned about. So there are Chinese companies with the support
Speaker 1: of the Chinese government, you know, that have been making
Speaker 1: certain progress with respect to the memory and of course
Speaker 1: you know these are taken into account when we look
Speaker 1: at overall industry supply and the industry supply growth, expectations
Speaker 1: of the future, and what we are here doing at
Speaker 1: Micron is continuing to stay ahead in terms of the
Speaker 1: technology capability. Of course, we always want a level playing
Speaker 1: field and of course respect for intellectual property, but we
Speaker 1: have to continue to drive our own technology roadmap. Today
Speaker 1: Emily Micron is a leader global leader in semiconductor deram
Speaker 1: as well as nand technology. And this is where right
Speaker 1: from here in Boise the teams that have produced tremendous
Speaker 1: amount of innovation that in the future we'll be able
Speaker 1: to combine with bringing into manufacturing right here as well.
Speaker 1: These are all chips ACKed enabled activities that actually ultimately
Speaker 1: help secure the national security of the U S as
Speaker 1: well by having manufacturing of critical um infrastructure needs chips
Speaker 1: being made here in the future in the semi inducted industry,
Speaker 1: M MICR and CEO Sandrea. There we still have some
Speaker 1: work to do I know security being a big, big
Speaker 1: part of that, and you're seeing some of the cybersecurity
Speaker 1: UM investment investing going way up. But um in the
Speaker 1: grand scheme and you look at the thesis of the
Speaker 1: blockchain and the teas the house should work. UM, it
Speaker 1: definitely gives athlete opportunity to go directly to this fan base,
Speaker 1: that gives the fan, uh you know, insights. That's a
Speaker 1: lot different and it's essentially cutting out the middle man.
Speaker 1: That was NBA champion and investor andre Iguadala speaking about
Speaker 1: the intersection of sports and n f t S. Let's
Speaker 1: dive deeper into this conversation in our Crypto report. Now
Speaker 1: with fantasy sports and blockchain Cup so Rare, which is
Speaker 1: backed by, among others, tennis great Serena Williams. The company
Speaker 1: has already inked partnerships with Major League Soccer in Major
Speaker 1: League Baseball and is now adding the NBA with the
Speaker 1: first free to play fantasy game based on digital cards.
Speaker 1: So we're CEO O Ryan Spoon joins us now for
Speaker 1: more on this deal. So talk to us Ryan about
Speaker 1: how this partnership with the NBA came together. First, Thanks
Speaker 1: for having me. Um it came together. It's it's just
Speaker 1: a very natural evolution. You heard Andre talk there about
Speaker 1: the importance of the opportunities that blockchain enables. We all
Speaker 1: know I spent years at ESPN on the digital side, um,
Speaker 1: how important and fun uh And how fast growing fantasy is.
Speaker 1: We know that on the collectible side, and so when
Speaker 1: you tie fantasy and collectibles with the blockchain on a
Speaker 1: global scale, the NBA is a perfect perfect product and partner.
Speaker 1: Uh And it's our third launch. As you mentioned, we
Speaker 1: have a big global soccer, global football game and community
Speaker 1: that's been very successful. A couple of months ago we
Speaker 1: announced and then launched our MLB partnership and so were MLB.
Speaker 1: And we're super excited to be doing this with the
Speaker 1: NBA right up around the U the upcoming season launch.
Speaker 1: This puts you in competition with NBA. Top shot, how
Speaker 1: do your platform stuck up? So we are very specifically
Speaker 1: focused on n f T based games. Uh So, players
Speaker 1: collect their cards you come in uh and everyone. Once
Speaker 1: you register, you get a free set of cards, and
Speaker 1: with those cards you play the game, and the game
Speaker 1: you're managing the cards. Uh So like a fantasy draft,
Speaker 1: but instead of ESPN, who I know and love and
Speaker 1: spent time this weekend doing my my fantasy drafts. Here,
Speaker 1: the player has the agency to pick and manage his
Speaker 1: or her roster. As you do that, you end up
Speaker 1: collecting cards as rewards. That's very different. I've admiration for
Speaker 1: Top Shot, I've admiration uh, and I'm a user of
Speaker 1: a lot of other platforms. But in our space, the
Speaker 1: fantasy based games, we are the leader, and these relationships
Speaker 1: are also um. You know, this is the lane that
Speaker 1: we are exclusively focused on, and we think we have
Speaker 1: demonstrated real leadership in now you've launched soccer and baseball
Speaker 1: n f T projects previously, No surprise, Aaron Judge and
Speaker 1: showhir Tani are the most used cards. What kind of
Speaker 1: traction have you seen so soccer. Soccer has obviously a
Speaker 1: larger runway. It is very uh successful, It's very large
Speaker 1: community behind it. Obviously it's a global game. Uh. The
Speaker 1: user based on our side is global. The traction is global,
Speaker 1: and when I say geographically diverse, it really is from
Speaker 1: all segments of the world. We closed last year, still
Speaker 1: believe we're in early days. We closed last year doing
Speaker 1: three million in card sales on the platform. We exceeded
Speaker 1: that in the first two quarters of the year, and
Speaker 1: now you begin to UH to introduce MLB. We did
Speaker 1: that end of July. The traction there has been really
Speaker 1: positive and encouraging. UM also a global footprint, which we
Speaker 1: think is important. Baseball is a really excellent product here,
Speaker 1: UM and sport because of the stats based nature, the movement,
Speaker 1: the surprise and NBA is going to be fantastic. We
Speaker 1: all know UM how important the stars are and the
Speaker 1: players and for what it's you know, it's worth noting
Speaker 1: our deal on the NBA side is with both the
Speaker 1: NBA and the n B a p A UM, so
Speaker 1: these are licensed UH, player driven cards UM. And I
Speaker 1: also think it's worth noting that MLB's biggest day on
Speaker 1: the platform was when we announced NBA last week, and
Speaker 1: so that's a really important example of how we think
Speaker 1: all these sports can fit together, how the global nature
Speaker 1: of these games hopefully works together. UH. In this concept
Speaker 1: of being able to collect a j Hoannice card or
Speaker 1: a Mike Trout or a killing and Bope and do
Speaker 1: that across the entire platform, that's a really big exciting idea.
Speaker 1: All right, good stuff. Bryan Spoon, CEO so rare. Well,
Speaker 1: andre iguadala is excited about it. That, um, you should
Speaker 1: get some folks excited. Thanks Ryan so much. Blue Origin
Speaker 1: aboarded a launch of its suborbital New Shepherd rocket moments
Speaker 1: after takeoff. This happened in West Texas, and it is
Speaker 1: the first major failure for Jeff Bezos company in several
Speaker 1: years Bloomberg. Lauren Grash joins US now from Austin with
Speaker 1: more details. So, Lauren, what happened, Well, we actually don't
Speaker 1: have a lot of detail is at the moment. Basically
Speaker 1: all we know is what we saw on the live
Speaker 1: stream of the the launch today. This was a pretty
Speaker 1: regular routine launched for Blue Origin. They were launching research payloads,
Speaker 1: many of which were funded by NASA. No people were
Speaker 1: on board, thankfully, but it was meant to be a
Speaker 1: pretty regular launch for them, sending these payloads to space
Speaker 1: and back. And then sometime a little after a minute
Speaker 1: into the launch, something seems to go wrong with the
Speaker 1: engine and it triggered the aboard escape system for the capsule.
Speaker 1: How significant is a failure like this in what would
Speaker 1: have been a pretty routine launch. I think Blue Origine
Speaker 1: got really lucky today because there was no people on board.
Speaker 1: I they have a pretty good track record when it
Speaker 1: comes to their their flights. They only really suff suffered
Speaker 1: one partial failure really early in their testing regime. So
Speaker 1: this is the first time pretty much all of New
Speaker 1: Shepherd's history that they've had a major failure like this.
Speaker 1: So I think it's it's probably going to be a
Speaker 1: while before we see New Shepherd fly again. So what
Speaker 1: is next here? Um, you know, when something like this happens,
Speaker 1: a significant failure like this, do you go back to
Speaker 1: the drawing board? You know, can years pass potentially as
Speaker 1: we've seen with NASA before, someone else before they try
Speaker 1: to attempt this once again. Yeah, it really depends on
Speaker 1: the source of the failure. The f A already said
Speaker 1: today that they're going to be looking into this. Uh.
Speaker 1: Fortunately no one was hurt today and the booster that
Speaker 1: you saw break away from that capsule, uh fell into
Speaker 1: a hazard a designated hazard zone, so ultimately everyone is safe.
Speaker 1: But yes, the f A said they will look into
Speaker 1: it and New Shepherd won't fly again until they get
Speaker 1: to the root of the problem. And it really, like
Speaker 1: I said, it depends on what the source of the
Speaker 1: issue is. You know, with these commercial companies. They can
Speaker 1: be a little a bit more nimble when it comes
Speaker 1: to return to flight. We've seen SpaceX return of flight
Speaker 1: pretty quickly after um some anomalies in the past, and
Speaker 1: so maybe it could be similar from Blue Origin. We
Speaker 1: just can't say for sure because we really don't know
Speaker 1: what what cost it. Can you put this into the
Speaker 1: context of Blue Origins broader ambitions of course, you know,
Speaker 1: I was there the day Jeff Bezos went into space.
Speaker 1: They have sent other folks up there, celebrities, Uh up
Speaker 1: up there, you know, talk to us about how this
Speaker 1: fits into the broader end, longer term plans. You know.
Speaker 1: Of course he's talked about this space colony and more. Well,
Speaker 1: I think it might be tad worrying for folks who
Speaker 1: might have a ticket to fly with Blue Origin. You know,
Speaker 1: this this was a rocket specifically geared toward launching payloads,
Speaker 1: but it is essentially the same rocket that they used
Speaker 1: to send people to the edge of space and back. However,
Speaker 1: some comfort can be had and the fact that it
Speaker 1: kind of worked asn't tended this an in flight aboard system.
Speaker 1: Basically what you saw is as soon as the system
Speaker 1: detected there was a problem with the rocket motors fired
Speaker 1: on the bottom of the capsule and immediately separated the
Speaker 1: capsule from the rocket, and that landed safely in the desert.
Speaker 1: So presumably if there had been people on board, they
Speaker 1: would have been just fine and would have landed safely.
Speaker 1: Can't say for sure, and thankfully there weren't any people
Speaker 1: on board. Um, but the system did seem to work
Speaker 1: as designed, so there is some comfort in that. But
Speaker 1: you know, I might, I'm if I had a ticket,
Speaker 1: I might, yeah, be a little nervous in the future.
Speaker 1: All right, point taco and Bloomery. Lauren Grass, who covers
Speaker 1: face for us, thank you so much for that update.
Speaker 1: And that does it. For the edition of Bloomberg Technology Tuesday,
Speaker 1: Melinda Gates will be joining us to talk about her
Speaker 1: foundation's efforts to fight poverty and gender gaps. And don't
Speaker 1: forget to check out our podcast wherever you get your podcast,
Speaker 1: I'm only check in San Francisco. This is Bloomberg. He
Speaker 1: pip pip a big people. He beating a bit and
Speaker 1: hept a whip. He give out big who beat a
Speaker 1: pick a good people out whip which a people be
Speaker 1: peaking a which people out? Which people