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Speaker 1: Bloomberg Audio Studios, podcasts, radio news. Bloomberg Tech is a

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Speaker 1: lie from coast to coast, with Caroline Hide in New

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Speaker 1: York and Ed Ludlow in San Francisco.

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Speaker 2: This is Bloomberg Tech coming up. We zero in on

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Speaker 2: tech earnings with Dell raising its AI servership and outlook

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Speaker 2: well HP announces job cuts, plus Warner Brothers Discovery asking

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Speaker 2: bidders for sweetened offers by December first as it explores

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Speaker 2: options for a sale, and Nvidia in focus is Doubts

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Speaker 2: over the company's AI chip dominance are growing. I'm Jim

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Speaker 2: Centeveec in New York in for Caroline Hide and Ed Ludlow.

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Speaker 2: Let's get a check on markets right now. Ustocks advancing

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Speaker 2: as expectations for an interest rate cut at the fed's

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Speaker 2: next meeting are helping to fuel gains before the Thanksgiving break.

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Speaker 2: NAZAC one hundred up right now and look at the

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Speaker 2: last three days of four percent. This after both the

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Speaker 2: S and P five hundred and NAZAC on hundred moved

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Speaker 2: away from their last record highs in late October.

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Speaker 3: The NAZAK one hundred.

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Speaker 2: Down about let's say, three point six percent from that

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Speaker 2: all time high. The s and P five hundred, though

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Speaker 2: down just a little over one percent. We're also looking

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Speaker 2: at tech earnings with Dell and HP. Dell raising its

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Speaker 2: annual projections for the AI server market thanks to sustain

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Speaker 2: demand for machines needed in the current data boom. Meanwhile,

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Speaker 2: HP stock under pressure down two point two percent right now.

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Speaker 2: The company now it's four thousand to six thousand job

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Speaker 2: cuts over the next couple of years by using more

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Speaker 2: AI tools. For more on HP and Dell, let's bring

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Speaker 2: in Bloomberg's and Dina Bastina joins us here in New York.

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Speaker 2: I want to start with HP. Four thousand to six

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Speaker 2: thousand jobs sounds like a lot. And indeed, if we

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Speaker 2: go to the six thousand sound it's like a ten

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Speaker 2: percent of.

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Speaker 3: The company's workforce.

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Speaker 2: But that's through twenty twenty eight fiscal years, so we're

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Speaker 2: a few years away from that. And if it's AI

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Speaker 2: that they're going to replace these people with, AI can

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Speaker 2: change a lot between.

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Speaker 3: Now and then.

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Speaker 4: Sure, And to be clear, each did a similar magnitude

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Speaker 4: job cut over the last three years.

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Speaker 3: They just finished it.

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Speaker 4: They have these kind of periodic efficiency plans. I guess

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Speaker 4: what's new about this one is the idea is that

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Speaker 4: they are going to use AI tools and models to

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Speaker 4: do things like product development, customer customer service sales, and

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Speaker 4: that's where you're getting these job cuts. But at the

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Speaker 4: same time, even though they're going to be saving money

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Speaker 4: that way, they said they actually took they actually came

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Speaker 4: in below on their guide for next year for fiscal

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Speaker 4: fiscal year profit and that was because of a completely

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Speaker 4: different issue around memory price increases. So you had both

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Speaker 4: you have these job cuts and it's not you know,

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Speaker 4: making the bottom line look where people expected it would

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Speaker 4: come in.

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Speaker 2: Well, speaking of those price increases, that also hitting Dell,

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Speaker 2: So let's let's talk a little bit about Dell. Dell

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Speaker 2: is contending with despite strong demand, how is it going

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Speaker 2: to make its AI server business more profitable.

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Speaker 4: So the AI server business, and that's basically since I

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Speaker 4: know you're going to be talking about GPUs in a minute,

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Speaker 4: are the servers that have GPUs that go into these

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Speaker 4: AI data centers, and the demand for them has been

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Speaker 4: very high for Dell and other makers. Of the problem

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Speaker 4: is that in order to get some of these deals

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Speaker 4: and in order to deploy some of those servers, Dell

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Speaker 4: was basically incurring more significant costs. What they're trying to

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Speaker 4: do now is pull back from that a little bit

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Speaker 4: to widen the profit margin in that business. They've they

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Speaker 4: succeeded in the last quarter, they told me, because they

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Speaker 4: were able to serve a more diverse group of customers,

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Speaker 4: so some of those were a better, more profitable sets

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Speaker 4: of deals.

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Speaker 3: Yeah.

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Speaker 2: I think these rising costs are going to be the

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Speaker 2: same throughout the next.

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Speaker 3: Year as well.

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Speaker 2: You know, always good to see you, Welcome back to

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Speaker 2: New York, Happy Thanksgiving as well. Well, let's bring in

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Speaker 2: now in talking video because in video shares over the

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Speaker 2: last five days taking a hit down more than three percent.

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Speaker 2: The stock facing pressures as AI Chip rivals gained ground,

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Speaker 2: leaving investors wondering if it's dominance can be sustained. Bloomberg's

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Speaker 2: Ryan Vistelica joins us for more So, Ryan, I think

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Speaker 2: the big question that investors have after seeing what happened

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Speaker 2: with Alphabet in this report in the information earlier this week,

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Speaker 2: is can Googles TPUs actually compete with the GPUs from Nvidia?

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Speaker 3: What are you hearing?

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Speaker 5: Hey, good morning, Thanks for having me. So I would

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Speaker 5: say that while there are a lot of differences between

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Speaker 5: Innvidia's chips and alphabets. Alphabets are designed for one specific purpose,

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Speaker 5: which is working with AI workloads in the cloud, which

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Speaker 5: is really the dominant use case for a lot of

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Speaker 5: the AI infrastructure that's being done right now. So there

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Speaker 5: is certainly a very big market for the TPU chips,

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Speaker 5: as we saw with the Anthropic deal that was announced

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Speaker 5: a couple of weeks ago and with this report with Meta,

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Speaker 5: so that opens up potentially a huge new market for Alphabet,

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Speaker 5: and it does put in Vidia's market share under a

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Speaker 5: little bit of pressure. Now, this is still very early

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Speaker 5: days and it's not like Alphabet is out there selling

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Speaker 5: chips to people in the same way that Nvidia is,

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Speaker 5: but certainly people are reassessing what our market share is

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Speaker 5: going to look like over the coming years. And if

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Speaker 5: in Videas is a lot smaller than previously expected, what

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Speaker 5: does that mean for the stock? What does that mean

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Speaker 5: for the valuation? What does that mean for its expected

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Speaker 5: growth rates going forward?

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Speaker 2: Yeah, I mean the analyst community, though at this point

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Speaker 2: even investors may be a little concerned, but the analyst community,

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Speaker 2: they've still got buys on this stock. I mean, there's

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Speaker 2: only one analyst who's tracked by Bloomberg. Jay Goldberg over

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Speaker 2: at Seaport, who has a sell on in Vidia.

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Speaker 3: Is he changing his tune? Are these analysts changing their tune?

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Speaker 6: No?

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Speaker 5: In fact, I spoke with him yesterday and he said

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Speaker 5: he is more negative on Nvidia now than he was

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Speaker 5: a couple of weeks ago. I would say that, you know,

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Speaker 5: the new concerns about you know, custom silicon and new

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Speaker 5: rising competition for in VideA. This comes at a time

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Speaker 5: when people are increasingly questioning the AI trade. There is

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Speaker 5: a lot of debate right now about the amount of

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Speaker 5: spending going on, how durable is this going to be,

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Speaker 5: how sustainable, what kind of returns our companies see on this?

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Speaker 5: And if they're not seeing big returns on this investment,

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Speaker 5: are is a going to pull back on their AI

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Speaker 5: spending going forward? And VideA is really at the heart

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Speaker 5: of a lot of AI debate right now. And then

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Speaker 5: you add in this new one where what does their

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Speaker 5: market share look like? What about competition? That is just

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Speaker 5: another reason for people to be skeptical. Although analysts so

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Speaker 5: far are holding firm and remain pretty positive.

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Speaker 2: Yeah, in Vidia shares up thirty two percent over the

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Speaker 2: last year, Bloomberg's Ryan Vistellica. Happy Thanksgiving, Ryan, Thanks for

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Speaker 2: joining us. Well, let's get more on the wider tech markets.

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Speaker 2: Nancy Tangler, CEO and CIO of Laffer Tangler Investment. She

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Speaker 2: says there's more room to run for AI stocks, writing quote,

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Speaker 2: since we are in the early stages of the AI

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Speaker 2: adoption and investment cycle, we believe the providers of the technology,

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Speaker 2: the picks and shovels, will continue to produce enviable earnings growth.

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Speaker 2: Nancy joins us, Now, what's a more promising pick and

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Speaker 2: or shovel?

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Speaker 3: Is it alphabet or is it in video? Nancy?

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Speaker 7: Thanks, you're having tim You know, I'm actually going to

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Speaker 7: go We own them both, and I'm going to go

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Speaker 7: with Nvidia. And the reason for that is I think

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Speaker 7: analysts are forgetting our investors are not focusing on Kuda,

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Speaker 7: which is the software system that developers use around the

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Speaker 7: Nvidia chips, Blackwell and then soon to be Reuben and

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Speaker 7: I think it's analogous to Apple and the App Store.

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Speaker 7: So you know, it was just a handset company when

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Speaker 7: we were buying it. I was told that every time

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Speaker 7: I talked about it on the air, but it was

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Speaker 7: really the app store and services that we were buying,

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Speaker 7: and this I think is analogous to that. If they lose,

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Speaker 7: you know, if they go from eighty percent to seventy

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Speaker 7: nine percent market share, I can live with that because

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Speaker 7: I think the earnings growth is going to continue.

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Speaker 8: And let'sten forget.

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Speaker 7: AMD is in the wings and we also own that

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Speaker 7: and Broadcom which.

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Speaker 8: Is developing the TPUs.

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Speaker 7: So I think there's a lot of ways to make

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Speaker 7: money in this trade.

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Speaker 2: At what point do we move meond the so called

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Speaker 2: picks and shovels of the AI trade and start to

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Speaker 2: see the increase in i don't know efficiency, the increase

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Speaker 2: in productivity in non technology companies.

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Speaker 7: So we listened to the company's tim and let me

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Speaker 7: give you one great example. We've talked about it before,

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Speaker 7: but Walmart is our poster child of our investing theme,

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Speaker 7: which is an old economy company that is pivoted to

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Speaker 7: the new technologies and is now going to be listed

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Speaker 7: on the NASDAK lets. Remember, so they had six percent

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Speaker 7: revenue growth, pretty good for Walmart, but twenty seven percent

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Speaker 7: in e commerce That was also interesting to me. But

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Speaker 7: what really got my attention was that delivery speeds were

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Speaker 7: thirty five percent of digital orders are arriving in under

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Speaker 7: three hours. They're also using automation in the fulfillment center,

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Speaker 7: so fifty percent of their orders are fulfilled automatically via robot.

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Speaker 7: We own the company that did all that for them, Symbotic,

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Speaker 7: So that's a second or maybe even third derivative player

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Speaker 7: in AI.

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Speaker 8: So I think it's broadening out. We're hearing it from

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Speaker 8: all across.

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Speaker 7: You know, Raytheon talked about how they were utilizing AI

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Speaker 7: in order to improve supply supply log.

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Speaker 9: Jams that's a stock we own, and TGLR, all of

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Speaker 9: these we own there actually, So I think it's important

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Speaker 9: to start listening to the companies paying attention to who's

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Speaker 9: seeing margin expansion, and we're definitely seeing it at the

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Speaker 9: company level.

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Speaker 3: Nancy.

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Speaker 2: If we were talking a week ago, I think we'd

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Speaker 2: have started our conversation focused on the idea of a bubble,

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Speaker 2: maybe concerns about CAPEX spending, the handwringing that we saw

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Speaker 2: last week over some of these valuations that has seemed

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Speaker 2: to receded received just a little bit this week. But

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Speaker 2: you've been through multiple cycles and I'm wondering how you

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Speaker 2: view the whole AI bubble talk right now, compared to

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Speaker 2: let's say, the tech boom of the late nineties and

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Speaker 2: bust as well.

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Speaker 10: Well.

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Speaker 7: I wish I was as clever as ed Yar Danny

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Speaker 7: because he coined this phrase too, But I wrote a

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Speaker 7: piece called the bubble and Bubble Talk.

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Speaker 8: I think it's important to note a couple of things.

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Speaker 7: In the nineties, from ninety six to two thousand, the

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Speaker 7: growth stocks that whose valuations were skyrocketing were actually experiencing

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Speaker 7: contracting earnings.

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Speaker 8: We're not seeing that now. Growth. The growth stocks in.

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Speaker 7: This particular technological revolution are experiencing about twenty percent growth

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Speaker 7: on average. Cap X was also something that was healthy

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Speaker 7: and then accelerated through the entire decade. We're just now

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Speaker 7: starting to see that ramp up in the last couple

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Speaker 7: of years.

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Speaker 8: So I think it's important.

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Speaker 7: And then these companies have fortress balance sheets and all this.

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Speaker 7: I don't want to say I am going to say

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Speaker 7: nonsense around Oracle. I think it's important to remember that

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Speaker 7: this is a company that's always had a ton of debt.

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Speaker 7: Debt to equity was four hundred and twenty seven percent

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Speaker 7: at the end of the quarter. That's down from seven

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Speaker 7: hundred and eighty percent year over year. This is all

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Speaker 7: before they issued the eighteen billion dollars in debt for

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Speaker 7: the open Ai data center build out. That this company

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Speaker 7: has a history of using debt. But the PPE is

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Speaker 7: up one hundred and thirty percent year over year, while

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Speaker 7: debt is only up nine So debt to equity will decline.

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Speaker 2: So you're not concerned at all about the price of

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Speaker 2: five year CDSS for Oracle rising to the highest going

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Speaker 2: back to October twenty twenty two. That's not concerning you.

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Speaker 11: It is.

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Speaker 8: It's a par trade though.

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Speaker 7: What concerns me more is the concentration in the market

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Speaker 7: around open Ai, and I think that has to sort

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Speaker 7: itself out now. Such in a della would tell you

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Speaker 7: that data centers are fungible. If we don't use it

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Speaker 7: for this, we'll use it for that, and I think

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Speaker 7: that's certainly true. But I am concerned about the SPEN.

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Speaker 7: I mean, that's a company with a burn rate, right

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Speaker 7: open Ai ten billion revenues and trillions and spend. Oracle

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Speaker 7: has other businesses they can change shift directions use data

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Speaker 7: center for cloud computing.

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Speaker 8: I don't like the par trade, but.

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Speaker 7: I think we were added to it a couple of

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Speaker 7: days ago and I think I think from here we're

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Speaker 7: going to be talking about fundamentals instead of it became

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Speaker 7: the post, it became the narrative stock for this.

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Speaker 8: This bubble is overdone. We're not in a bubble.

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Speaker 2: Yeah, those September highs that we saw for Oracle, I

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Speaker 2: mean we're done significantly from those, but still up seven

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Speaker 2: percent over the last year.

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Speaker 3: In about twenty percent so far this year.

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Speaker 2: Nancy Tangler of Laffer Tangler Investments always good to see

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Speaker 2: you happy Thanksgiving. Well, Uber is going to begin offering

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Speaker 2: driver list trips and we ride vehicles around parts of

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Speaker 2: Abu Dhabi. The new milestone follows the two companies first

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Speaker 2: launching a ride service with safety operators behind the wheel

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Speaker 2: almost a year ago. They intend to expand their driver

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Speaker 2: list vehicle operating territory at Abu Dhabi and extend their

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Speaker 2: partnership to Dubai soon. Well, coming up, holiday shopping season

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Speaker 2: is here and with it new online scams. We're going

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Speaker 2: to discuss what to look out for it how to

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Speaker 2: protect yourself next.

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Speaker 3: This is Bloomberg Tech.

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Speaker 2: Holiday shopping sales seem to start earlier and earlier, but

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Speaker 2: this year's Black Friday and Cyber Monday deals might not

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Speaker 2: be a steep. Bloomberg opinion columnist Andrea Felstaid has a

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Speaker 2: peace out, and she writes that tariffs will cause retailers

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Speaker 2: to offer smaller discounts. In the quest for deals, shoppers

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Speaker 2: may be tempted to turn to new websites or click

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Speaker 2: ads for deals that turn out to be scams. Teresa

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Speaker 2: Payton is former White House CIO and current CEO of

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Speaker 2: the cybersecurity firm Forderless Solutions.

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Speaker 3: She joins us for more good to have you on

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Speaker 3: the program.

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Speaker 2: You know, I'm always thinking that we're in this day

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Speaker 2: and age where it can easily become victims of fraud

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Speaker 2: or victims of scams. But why does it happen with

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Speaker 2: increased frequency during heavy shoppy seasons like Black Friday.

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Speaker 12: Well, we're all busy and many of us are looking

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Speaker 12: for extra deals and extra bargains this year, like you

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Speaker 12: mentioned earlier, because of the tariffs, and with that, we're

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Speaker 12: getting bombarded on social media with things that look really

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Speaker 12: cool and hot, and we want to make sure we

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Speaker 12: get the deal, we get it quickly before they run out.

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Speaker 12: And don't forget, criminals and fraudsters now have AI as

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Speaker 12: a tool at their fingertips, and so it's making it

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Speaker 12: very cost effective for them to target you and me

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Speaker 12: while we do our holiday shop.

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Speaker 2: Okay, so I want to get to what we can

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Speaker 2: do to protect ourselves. But before we do that, Teresa,

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Speaker 2: how are they using AI to target us? What does

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Speaker 2: that look like? And how could that look differently than

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Speaker 2: the scams that we're used to.

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Speaker 12: Yeah, so they're basically reverse engineering websites that you or

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Speaker 12: I might go to, the legitimate websites, and then they're

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Speaker 12: doing things like a play on the name and then

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Speaker 12: setting up imposter social media accounts and basically jumping.

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Speaker 10: Into your feed.

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Speaker 12: Then you follow this great deal and then the next

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Speaker 12: thing you know, you're buying from a scammer or a

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Speaker 12: fraudster and not from the actual website that you think

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Speaker 12: you're visiting. They're also spinning up businesses using bots to

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Speaker 12: actually give them them sells great reviews. So it all

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Speaker 12: looks like it's on the up and up, But just

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Speaker 12: a little bit of diligence and a little bit of research,

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Speaker 12: you'll be able to figure out and spot the scam

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Speaker 12: sites and the fraud sites pretty easily.

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Speaker 2: Okay, you mentioned diligence and research. You shared with our

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Speaker 2: team reputation checkers for websites. I'd never actually even heard

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Speaker 2: of these or used them before. Should these be part

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Speaker 2: of our diet when it comes to healthy shopping?

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Speaker 12: Yeah, I love the fact that you brought this up

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Speaker 12: because I personally use these websites, especially if I'm going

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Speaker 12: to a site I've never ordered from before. Even if

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Speaker 12: I have a friend or a relative tell me they've

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Speaker 12: used a site, so things like scam Advisor, you aurl, Void,

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Speaker 12: trust Pilot, and I will post these on my social

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Speaker 12: media accounts. These websites will actually tell you how old

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Speaker 12: the domain name is. It could be legitimately a brand

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Speaker 12: new business, or it might be a scamra frauds, you're

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Speaker 12: taking advantage of holidays.

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Speaker 10: So it'll also.

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Speaker 12: Tell you whether or not security companies or consumers reported

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Speaker 12: issues with these sites.

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Speaker 10: And of course old school still rules.

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Speaker 12: The Better Business Bureau is a great place to check

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Speaker 12: on a domain name as well.

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Speaker 2: Okay, so I think that for me, at least one

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Speaker 2: area that I always think of as a backstop is

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Speaker 2: the way I pay. And I'm only using credit cards

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Speaker 2: on these websites because I feel like if I have

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Speaker 2: an issue then I can just call my credit card

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Speaker 2: company and they can protect me. Are people using other

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Speaker 2: payment solutions that might not have that same level of protection.

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Speaker 10: Yeah, this is the tough part, and I agree with you.

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Speaker 12: I only use a credit card when I am shopping online.

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Speaker 12: I do not use my debit card. I don't use

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Speaker 12: gift cards to shop online. What's happening is a lot

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Speaker 12: of these scam sites and fraud sites will say things

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Speaker 12: like we only accept Venmo or zell, we only accept

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Speaker 12: gift cards, we only accept wire transfers. So they might say, well,

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Speaker 12: for this to work, we're international, we have to have

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Speaker 12: a wire transfer. These are red flags when a merchant

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Speaker 12: tells you they will only accept those form of payment

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Speaker 12: and they won't accept credit card. Chances are you're dealing

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Speaker 12: with a fraudster because they know the credit card companies

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Speaker 12: will actually come after them and shut them down, so

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Speaker 12: they want you to use these other forms of payment.

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Speaker 2: Other red flags maybe a price is too good to

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Speaker 2: be true.

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Speaker 12: Yeah, So if you see things like seventy to ninety

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Speaker 12: percent off during the holiday season, that is typically a

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Speaker 12: red flag. Now, unless you're on sort of a household

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Speaker 12: name website that you navigated to on your own, you

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Speaker 12: didn't follow a link in social media, you didn't follow

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Speaker 12: link in an email or text.

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Speaker 10: So if it's too good to be true, also look

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Speaker 10: at that domain name. When in doubt.

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Speaker 12: There's a website called VirusTotal dot com. You can use

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Speaker 12: it for free. Copy and paste that website in there,

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Speaker 12: and it'll actually evaluate the URL and tell you whether

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Speaker 12: or not you might be dealing with the scam site.

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Speaker 2: Okay, Teresa, before we let you go, if you do

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Speaker 2: somehow become a victim of not necessarily a cyber attack,

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Speaker 2: but maybe an attack on your identity or some sort

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Speaker 2: of scam, what should be the first thing you do?

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Speaker 12: Yeah, first thing you do is you want to call

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Speaker 12: your bank. So whatever payment method you used, you need

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Speaker 12: to lock down your life. The next thing to think

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Speaker 12: about is actually you can report it at the FBI,

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Speaker 12: to IC three dot gov and the FTC FTC dot gov.

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Speaker 12: But also there is a nonprofit resource that is free

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Speaker 12: to use called the Identity Resource Theft Center. It's a

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Speaker 12: great nonprofit. I've referred people there and they will actually

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Speaker 12: give you a checklist.

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Speaker 10: You can talk to a real human.

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Speaker 12: Being and work on getting your peace of mind and

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Speaker 12: your identity back.

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Speaker 2: Teresa, Payton, CEO of Forder Lists Solutions, thank you so

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Speaker 2: much for joining us.

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Speaker 3: Coming out, the.

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Speaker 2: US face is a potential electricity crisis due to a

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Speaker 2: surge in demand to power AI data centers. We've got

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Speaker 2: the details. Next, this is Bloomberg Tech. Well, today we

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Speaker 2: take a look at America's power system. It was already

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Speaker 2: under stress even before the AI boom. Now with AI

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Speaker 2: data centers coming online, a new Schneider Electric analysis foresees

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Speaker 2: the US facing a potential electricity crisis. This is the

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Speaker 2: surgeon demand comes at odds with the reality of aged

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Speaker 2: and vulnerable grids. Bloomberg's ESG reporter Alistair Marsh joins us

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Speaker 2: from No More. Alistair, how does electricity crisis manifest in

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Speaker 2: the United States? Certainly higher bills as part of that,

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Speaker 2: but are we talking rolling blackouts here for many Americans?

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Speaker 13: Well, essentially, the Schneider Electric data shows that the massive

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Speaker 13: amount of power demands to power demand in the US

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Speaker 13: has basically been flat for about two decades, and all

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Speaker 13: of a sudden with the advent of Aisle, the last

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Speaker 13: AI acceleration that we're seeing in the US, with the

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Speaker 13: billions of dollars of kpex being put to work and

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Speaker 13: the mass build out of data centers. You suddenly have

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Speaker 13: this surge in demand. Add to that increase electrification, add

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Speaker 13: to that onsurine of manufacturing, and you suddenly have this

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Speaker 13: sort of crisis moment where the energy infrastructure in the

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Speaker 13: US has not been invested in and not been built

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Speaker 13: out particularly aggressively for a period meets a very aggressive

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Speaker 13: build out of AI, and so we're going to reach,

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Speaker 13: according to the Schneider data, we're going to reach a

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Speaker 13: crunch point in about three years, in twenty twenty eight.

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Speaker 13: That's the moment they say that the supply available on

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Speaker 13: the system will not be able to will no longer

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Speaker 13: be able to meet demand unless we start eating into

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Speaker 13: emergency reserves of power which you are saved from moments

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Speaker 13: of extreme weather or cyber attacks and so forth, all

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Speaker 13: of which means that the grid is basically going to

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Speaker 13: become under increased strain and going to be increasingly vulnerable.

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Speaker 2: You cover ESG for Bloomberg News. You're joining us from London.

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Speaker 2: I'm not going to make your wigh in on the

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Speaker 2: politics of infrastructure spending here in the United States, but

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Speaker 2: it's very political, like so much spending is is there

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Speaker 2: foreseeably a way that even if the US had the money,

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Speaker 2: they could reliably upgrade the grid's weak points with enough

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Speaker 2: in enough time to be ready for this surge.

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Speaker 13: A short answer is no, I mean you're kind to

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Speaker 13: let me not weigh into the US politics, But there

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Speaker 13: is both a political issue here. I mean, you see

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Speaker 13: it with the recently power prices are on the ballot

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Speaker 13: in New Jersey, and they'll be increasingly on the ballot,

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Speaker 13: and that could turn against the AI build out if

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Speaker 13: there's a sort of political groundswell against that. But also

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Speaker 13: there's a geopolitical element here where the US is in

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Speaker 13: a race with China to be kind of the AI superpower,

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Speaker 13: and China has Why you could argue that the US

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Speaker 13: has the advantage in terms of tech and chips, actually

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Speaker 13: China has a structural advantage with cheaper, abundant power, and

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Speaker 13: that might be, according to some analysts, something that wins

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Speaker 13: out in the long run. And so what Schneider is

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Speaker 13: saying here to go back to actually answer your question

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Speaker 13: is that no, you can't fix us in the three

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Speaker 13: year period because you can't build enough generation and enough

443
00:22:09,480 --> 00:22:11,800
Speaker 13: transmission in that period because most of those projects will

444
00:22:11,800 --> 00:22:14,320
Speaker 13: take ten years to build. Therefore, you need to find

445
00:22:14,359 --> 00:22:17,680
Speaker 13: ways at the margin what are sometimes called grid enhancing technologies,

446
00:22:17,840 --> 00:22:22,199
Speaker 13: battery storage, micro grids, other things that can kind of

447
00:22:22,200 --> 00:22:26,840
Speaker 13: build out extra capacity to that don't require those large,

448
00:22:26,920 --> 00:22:29,760
Speaker 13: long infrastructure buildouts that just won't be ready in time.

449
00:22:30,160 --> 00:22:33,679
Speaker 2: Bloomberg's Alistair Marsh joining us from London. Alistair mentioned the

450
00:22:33,720 --> 00:22:36,680
Speaker 2: political implications of this. Do you check out Bloomberg Opinion

451
00:22:36,920 --> 00:22:39,480
Speaker 2: and Connorson had an interesting story just in the last

452
00:22:39,480 --> 00:22:42,280
Speaker 2: few days about what happened in Georgia. Hey, coming up next,

453
00:22:42,320 --> 00:22:45,320
Speaker 2: we're going to speak with CFR senior equity analyst Angela

454
00:22:45,400 --> 00:22:49,600
Speaker 2: Zeno as investors begin to question longevity of the AI trade.

455
00:22:49,720 --> 00:23:04,280
Speaker 2: This is Bloomberg Tech. Welcome back to Bloomberg Tech. I'm

456
00:23:04,320 --> 00:23:06,640
Speaker 2: Tim Steneveek in New York in for Caroline Hide and

457
00:23:06,720 --> 00:23:09,640
Speaker 2: at Ludlow. Let's take a look at the markets. Checking

458
00:23:09,640 --> 00:23:12,800
Speaker 2: out the NASAQ one hundred slightly up on the day today,

459
00:23:12,960 --> 00:23:17,120
Speaker 2: hopes of a FED rate cut in the December meeting. Meanwhile,

460
00:23:17,160 --> 00:23:20,119
Speaker 2: also taking a look at alphabet in Nvidia. In Vidia

461
00:23:20,160 --> 00:23:22,919
Speaker 2: facing concerns that its market share and semis used in

462
00:23:22,960 --> 00:23:26,760
Speaker 2: AI computing is slipping following a report suggesting Google's AI

463
00:23:26,800 --> 00:23:29,560
Speaker 2: processors are gaining ground. Google down on the day one

464
00:23:29,600 --> 00:23:33,080
Speaker 2: point two percent, in Vidia higher by one point eight percent.

465
00:23:33,640 --> 00:23:36,639
Speaker 2: This comes as in video celebrated Google's achievement earlier today,

466
00:23:36,720 --> 00:23:39,520
Speaker 2: but also saying the chip makers still quote a generation

467
00:23:39,600 --> 00:23:42,920
Speaker 2: ahead of the industry. It's the only platform that runs

468
00:23:42,960 --> 00:23:46,760
Speaker 2: every AI model and does it everywhere computing is done.

469
00:23:46,800 --> 00:23:49,119
Speaker 2: This is a tweet from the Nvidia newsroom or a

470
00:23:49,160 --> 00:23:51,720
Speaker 2: post on acts I should say from the Nvidia newsroom.

471
00:23:51,920 --> 00:23:55,480
Speaker 2: Let's get more with Bloomberg Equities reporter Carmen Reinikey. Carmen

472
00:23:55,560 --> 00:23:59,719
Speaker 2: does seem like investors are starting to feel like Alphabet's

473
00:23:59,720 --> 00:24:03,200
Speaker 2: Google could be gaining when it comes to market share

474
00:24:03,400 --> 00:24:04,840
Speaker 2: in what Invidia.

475
00:24:04,480 --> 00:24:05,840
Speaker 3: Has absolutely ruled.

476
00:24:05,880 --> 00:24:08,959
Speaker 2: But still the analyst community community at this point is

477
00:24:09,000 --> 00:24:10,119
Speaker 2: not really convinced.

478
00:24:10,200 --> 00:24:13,560
Speaker 3: What are your sources telling you, Yeah, that's really true.

479
00:24:13,560 --> 00:24:16,360
Speaker 6: I mean, I think in Nvidia is really still so dominant.

480
00:24:16,359 --> 00:24:18,199
Speaker 6: And that's what we're seeing from analysts.

481
00:24:18,240 --> 00:24:19,000
Speaker 8: You know, even though.

482
00:24:18,920 --> 00:24:22,399
Speaker 6: There's been sort of these questions about the AI trade

483
00:24:22,560 --> 00:24:25,719
Speaker 6: and you know, Google's chips coming in being more competition,

484
00:24:26,280 --> 00:24:29,200
Speaker 6: analysts have actually raised their estimates for Nvidia going forward.

485
00:24:29,280 --> 00:24:30,280
Speaker 8: You know, it's last.

486
00:24:30,080 --> 00:24:34,199
Speaker 6: Quarter was so good, had this huge revenue forecast, and

487
00:24:34,320 --> 00:24:35,840
Speaker 6: you know, we're seeing a little bit of a relief

488
00:24:35,960 --> 00:24:38,680
Speaker 6: rally in the shares today. It's gotten pretty beaten down,

489
00:24:38,760 --> 00:24:41,120
Speaker 6: but dip buyers are you know, starting to come back in.

490
00:24:41,440 --> 00:24:42,560
Speaker 10: And then on the flip side.

491
00:24:42,359 --> 00:24:45,200
Speaker 6: We're seeing you know, Google actually dip a little bit today. Now,

492
00:24:45,280 --> 00:24:47,840
Speaker 6: of course it was it's been at a record high,

493
00:24:47,880 --> 00:24:51,159
Speaker 6: so that's that's no surprise. But really, you know, in

494
00:24:51,200 --> 00:24:53,640
Speaker 6: Nvidia does seem to still remain on top, and it's

495
00:24:53,640 --> 00:24:55,639
Speaker 6: one that we're going to continue watching as really the

496
00:24:55,680 --> 00:24:57,199
Speaker 6: dominant player in the AI space.

497
00:24:57,359 --> 00:24:59,680
Speaker 2: Dominant player in the AI space. But in terms of

498
00:24:59,720 --> 00:25:04,120
Speaker 2: stock performance this year, Alphabet has just been remarkable, close

499
00:25:04,160 --> 00:25:07,280
Speaker 2: to seventy percent increase so far this year. In Vidia

500
00:25:07,520 --> 00:25:10,480
Speaker 2: up about thirty five percent. That's nothing to shake a

501
00:25:10,520 --> 00:25:14,960
Speaker 2: stick at. Also, Alphabet approaching a four trillion dollar marketcap.

502
00:25:15,119 --> 00:25:18,560
Speaker 2: We're in videos, you know, above four trillion dollars. Are

503
00:25:18,600 --> 00:25:21,920
Speaker 2: analysts more bullish on in video? Are they more bullish

504
00:25:21,960 --> 00:25:23,119
Speaker 2: when it comes to Alphabet?

505
00:25:24,320 --> 00:25:26,320
Speaker 6: You know, I think analysts are really bullish across the

506
00:25:26,320 --> 00:25:28,960
Speaker 6: board on both companies. You know, they're so big and

507
00:25:28,960 --> 00:25:32,040
Speaker 6: they do so many things so well. But you know,

508
00:25:32,080 --> 00:25:34,680
Speaker 6: the market cap thing is really interesting. We're watching all

509
00:25:34,720 --> 00:25:38,000
Speaker 6: of those companies very closely. You know, it's always been

510
00:25:38,040 --> 00:25:41,880
Speaker 6: sort of Apple and in Vidia jockeying for the top spot,

511
00:25:41,960 --> 00:25:43,800
Speaker 6: you know, the biggest company in the world. But you know,

512
00:25:43,840 --> 00:25:47,320
Speaker 6: Google's really in the mix now, so it'll be really

513
00:25:47,320 --> 00:25:49,760
Speaker 6: interesting to see sort of where we end up this year.

514
00:25:50,119 --> 00:25:52,960
Speaker 6: You're right, Google's stock has done so well. I think

515
00:25:53,000 --> 00:25:55,480
Speaker 6: it's still the top performing stock in the meg seven,

516
00:25:55,520 --> 00:25:59,680
Speaker 6: really kind of taking over in Video's place there. But yeah, overall,

517
00:25:59,760 --> 00:26:02,600
Speaker 6: you know, so Wall Street is very bullish on these

518
00:26:02,840 --> 00:26:05,280
Speaker 6: on these stocks, and I think in Vidia still only

519
00:26:05,320 --> 00:26:09,280
Speaker 6: really has one bear on Wall Street, who just boosted

520
00:26:09,320 --> 00:26:12,200
Speaker 6: his estimates, you know, for the company's earnings going forward.

521
00:26:12,280 --> 00:26:12,440
Speaker 3: Yeah.

522
00:26:12,520 --> 00:26:16,040
Speaker 2: Jay Goldberg over at cpour Research that lonely in Vidia bear,

523
00:26:16,080 --> 00:26:19,359
Speaker 2: but he's sticking by his call. Bloomberg's harmon Ryanikey joining us.

524
00:26:19,359 --> 00:26:22,280
Speaker 2: Happy holidays, Carmen, appreciate you joining us today. Hey, let's

525
00:26:22,280 --> 00:26:24,879
Speaker 2: get more on the market movements with Angelo Zeno, senior

526
00:26:24,960 --> 00:26:28,679
Speaker 2: equity analyst at CFI Research. Angela, what do you make

527
00:26:28,720 --> 00:26:31,879
Speaker 2: of this sort of race between Alphabet and in Video

528
00:26:31,880 --> 00:26:33,879
Speaker 2: that we've seen play out over the last couple of days.

529
00:26:33,880 --> 00:26:37,080
Speaker 2: The narrative shift that hey, wait, a second Alphabet with

530
00:26:37,119 --> 00:26:39,800
Speaker 2: a ten year old product might actually have something that

531
00:26:39,800 --> 00:26:41,800
Speaker 2: could compete within Video's GPUs.

532
00:26:41,840 --> 00:26:42,399
Speaker 3: Do you buy it?

533
00:26:43,520 --> 00:26:43,760
Speaker 8: Yeah?

534
00:26:43,800 --> 00:26:45,520
Speaker 14: And thanks for having me, Tim. The way I look

535
00:26:45,560 --> 00:26:48,760
Speaker 14: at this is, listen, in Video's had the ninety percent

536
00:26:48,840 --> 00:26:52,640
Speaker 14: plus market share on the computer side right with their GPUs.

537
00:26:53,280 --> 00:26:55,199
Speaker 14: Our view the whole time was that they were going

538
00:26:55,240 --> 00:26:58,000
Speaker 14: to lose share anyway, and that custom silicon chips were

539
00:26:58,040 --> 00:27:00,800
Speaker 14: going to gain a bigger pe. So the pie A

540
00:27:00,920 --> 00:27:03,960
Speaker 14: and D eventually was going to have its share as

541
00:27:04,000 --> 00:27:06,560
Speaker 14: a second alternative to the GPU market. So this is

542
00:27:06,640 --> 00:27:10,000
Speaker 14: kind of playing out though the way we anticipated. It's

543
00:27:10,040 --> 00:27:12,959
Speaker 14: going to be a slow role, but ultimately, listen, I

544
00:27:12,960 --> 00:27:15,280
Speaker 14: do think there's a place for TPUs as well as

545
00:27:15,320 --> 00:27:17,960
Speaker 14: other customs silicon chips. I don't think you can necessarily

546
00:27:18,000 --> 00:27:21,240
Speaker 14: sleep on, you know, a company like Amazon. But you know,

547
00:27:21,359 --> 00:27:25,399
Speaker 14: it's interesting that the strategic pivot that potentially Alphabet is

548
00:27:25,440 --> 00:27:29,000
Speaker 14: looking at potentially you know, looking to sell those TPUs

549
00:27:29,040 --> 00:27:31,440
Speaker 14: to Meta and you know, to the extent that that's

550
00:27:31,520 --> 00:27:34,440
Speaker 14: true and to how quickly some of that scales up,

551
00:27:34,480 --> 00:27:38,480
Speaker 14: I think is a risk to the Invidia story. But again,

552
00:27:38,560 --> 00:27:41,080
Speaker 14: I mean, video will continue to be the dominant player

553
00:27:41,160 --> 00:27:44,200
Speaker 14: out there, and I think investors, you know, maybe it

554
00:27:44,240 --> 00:27:48,120
Speaker 14: shouldn't be looking too deep into the share fight and

555
00:27:48,320 --> 00:27:51,399
Speaker 14: kind of you know, can also consider the upside in

556
00:27:51,480 --> 00:27:54,000
Speaker 14: terms of the total addressable market opportunity here over the

557
00:27:54,040 --> 00:27:54,800
Speaker 14: next couple of years.

558
00:27:54,880 --> 00:27:57,640
Speaker 2: Well, it makes me think of the incredible and enviable

559
00:27:57,720 --> 00:28:00,560
Speaker 2: margins that Invidia has and it's data center bits, and

560
00:28:00,600 --> 00:28:03,200
Speaker 2: I'm wondering, okay, well, even if in Video still becomes

561
00:28:03,200 --> 00:28:06,159
Speaker 2: and remains the clear market leader, does it put margin

562
00:28:06,160 --> 00:28:08,040
Speaker 2: pressure on the company? Does the company have to come

563
00:28:08,040 --> 00:28:09,560
Speaker 2: out and say, okay, well we're not going to charge

564
00:28:09,560 --> 00:28:13,480
Speaker 2: as much for these GPUs because they're potentially, at least

565
00:28:13,520 --> 00:28:17,360
Speaker 2: for some customers there may be another option out there.

566
00:28:17,440 --> 00:28:18,800
Speaker 3: Does it put margin pressure on them?

567
00:28:19,560 --> 00:28:21,480
Speaker 14: I think that's an interesting point. The way we look

568
00:28:21,480 --> 00:28:23,399
Speaker 14: at this actually is a little bit differently. I mean,

569
00:28:23,400 --> 00:28:26,120
Speaker 14: when we think about kind of these next gen offerings

570
00:28:26,280 --> 00:28:28,760
Speaker 14: that in Video is set to roll out, and we're

571
00:28:28,800 --> 00:28:31,720
Speaker 14: big believers that listen, in Vidia is the generation ahead.

572
00:28:31,760 --> 00:28:34,680
Speaker 14: They will continue to be you know, leaders in terms

573
00:28:34,720 --> 00:28:37,480
Speaker 14: of technology advancements. But as you roll out Ruben, and

574
00:28:37,600 --> 00:28:39,840
Speaker 14: Ruben doesn't really have kind of the step up function

575
00:28:40,240 --> 00:28:44,200
Speaker 14: you know to Blackwell the way Blackwell had relative to Hopper.

576
00:28:44,440 --> 00:28:47,080
Speaker 14: But you get to Ruben and then Ruben Ultra, You're

577
00:28:47,120 --> 00:28:49,840
Speaker 14: going to see some significant content growth here over the

578
00:28:49,840 --> 00:28:52,400
Speaker 14: next couple of years from a Nvidia in the data center.

579
00:28:52,160 --> 00:28:54,280
Speaker 3: So that should continue to hold up data.

580
00:28:54,360 --> 00:28:57,760
Speaker 14: Their revenue trajectory as well as you know, the margins

581
00:28:57,800 --> 00:29:00,720
Speaker 14: here for the company. So we're not necessary really concerned

582
00:29:00,760 --> 00:29:03,400
Speaker 14: about margins here. But that said, listen, if we get

583
00:29:03,440 --> 00:29:06,320
Speaker 14: to a point where you know, the whole debate between

584
00:29:06,360 --> 00:29:09,160
Speaker 14: supply demands starts to you know, even out and those

585
00:29:09,200 --> 00:29:12,560
Speaker 14: competitive pressures do start to intensify, then you have an issue.

586
00:29:12,600 --> 00:29:14,640
Speaker 14: It's not something we're really kind of concerned about here

587
00:29:14,640 --> 00:29:16,160
Speaker 14: over the next eighteen to twenty four months.

588
00:29:16,200 --> 00:29:19,800
Speaker 2: So okay, so you know, in terms of not being

589
00:29:19,800 --> 00:29:22,000
Speaker 2: concerned in the near term, that makes sense. What about

590
00:29:22,040 --> 00:29:23,920
Speaker 2: the other side of the coin, which is the opportunity

591
00:29:23,920 --> 00:29:28,000
Speaker 2: that it presents for Alphabet Can they ramp up production

592
00:29:28,080 --> 00:29:28,440
Speaker 2: of these?

593
00:29:28,560 --> 00:29:29,880
Speaker 3: Can they can they.

594
00:29:29,960 --> 00:29:32,520
Speaker 2: Actually get these to customers quickly who they want them?

595
00:29:33,240 --> 00:29:35,680
Speaker 14: Yeah, I mean, and to the extent that they you know,

596
00:29:35,720 --> 00:29:38,600
Speaker 14: they're looking at this strategic pivot I think, you know,

597
00:29:38,680 --> 00:29:41,719
Speaker 14: remains to be seen, but yeah, I mean, listen, it's

598
00:29:41,760 --> 00:29:45,280
Speaker 14: an opportunity for them. Again, I don't think they take

599
00:29:45,360 --> 00:29:46,960
Speaker 14: up a huge chunk of the market. I think it's

600
00:29:47,000 --> 00:29:50,800
Speaker 14: actually a bigger play, an opportunity for Broadcom, to be

601
00:29:50,840 --> 00:29:52,600
Speaker 14: honest with you, and as you kind of go into

602
00:29:52,640 --> 00:29:56,120
Speaker 14: twenty six and twenty seven, the accelerating growth that you're

603
00:29:56,160 --> 00:29:59,480
Speaker 14: going to see in their semiconductor business I think is

604
00:29:59,560 --> 00:30:03,560
Speaker 14: kind of a nic intriguing play alongside there their software offering,

605
00:30:03,600 --> 00:30:07,280
Speaker 14: where if you have any concerns about share loss from Nvidia,

606
00:30:07,920 --> 00:30:10,280
Speaker 14: take a look at Broadcom because that becomes a nice

607
00:30:10,280 --> 00:30:12,960
Speaker 14: interesting play on a company that we'll be taking market

608
00:30:13,000 --> 00:30:16,760
Speaker 14: share here on that customer silicon growth as they also

609
00:30:16,840 --> 00:30:19,640
Speaker 14: continue to broad in out their customer base outside of

610
00:30:19,760 --> 00:30:24,680
Speaker 14: just you know, Alphabet's TPUs to other customs silicon vendors.

611
00:30:24,840 --> 00:30:27,080
Speaker 2: Angela, if we were having a conversation last week, we'd

612
00:30:27,120 --> 00:30:29,720
Speaker 2: probably be talking about and we'd probably started the conversation

613
00:30:29,800 --> 00:30:33,080
Speaker 2: with equity evaluations, And I'm just wondering how you're looking

614
00:30:33,080 --> 00:30:36,600
Speaker 2: at valuations right now where there's been some talk about okay,

615
00:30:36,640 --> 00:30:39,480
Speaker 2: things are looking a little bit bubbly right now.

616
00:30:40,520 --> 00:30:43,240
Speaker 14: You know, I actually feel much better about valuations today

617
00:30:43,240 --> 00:30:45,960
Speaker 14: than I did three four weeks ago, and it almost

618
00:30:46,040 --> 00:30:48,440
Speaker 14: kind of self corrected itself out right. So when you

619
00:30:48,480 --> 00:30:51,840
Speaker 14: look ahead of just you know, late October, look at valuations,

620
00:30:51,840 --> 00:30:54,880
Speaker 14: they were essentially where we were at the June twenty

621
00:30:54,920 --> 00:30:59,000
Speaker 14: four you know, tech highs, and essentially at twenty year highs,

622
00:30:59,160 --> 00:31:00,800
Speaker 14: So you kind of look, get what the market is

623
00:31:00,840 --> 00:31:02,960
Speaker 14: done here. We've actually had a better than expected Q

624
00:31:03,040 --> 00:31:05,640
Speaker 14: three earning season. On top of that, also we'll pull

625
00:31:05,680 --> 00:31:08,320
Speaker 14: back here on the tech side, that's really kind of

626
00:31:08,360 --> 00:31:13,000
Speaker 14: compressed multiples to now where you would expect multiples on

627
00:31:13,480 --> 00:31:16,120
Speaker 14: a forward basis to be here over the last five years.

628
00:31:16,160 --> 00:31:19,320
Speaker 14: So when you look at valuations, especially given the earnings

629
00:31:19,360 --> 00:31:21,120
Speaker 14: growth that we see over the next eighteen to twenty

630
00:31:21,160 --> 00:31:25,560
Speaker 14: four months, we actually think this is actually an enticing opportunity,

631
00:31:25,800 --> 00:31:28,840
Speaker 14: especially with some of those larger cap tech names. You

632
00:31:28,880 --> 00:31:31,840
Speaker 14: look at maybe some of the most reasonable valuations out there.

633
00:31:32,120 --> 00:31:34,560
Speaker 14: Meta and Nvidia really kind of stand out at this

634
00:31:34,680 --> 00:31:36,880
Speaker 14: point in time where I think they could be kind

635
00:31:36,880 --> 00:31:39,600
Speaker 14: of nice rebound plays on the sharp pullback they've.

636
00:31:39,440 --> 00:31:42,640
Speaker 2: Pad Hey, just twenty seconds angelo before we let you go.

637
00:31:42,680 --> 00:31:45,240
Speaker 2: We just had an interesting conversation with Alistair Marsh about

638
00:31:45,720 --> 00:31:48,840
Speaker 2: data centers and what could happen in the United States

639
00:31:48,880 --> 00:31:52,000
Speaker 2: to the electric grid and China actually taking a lead

640
00:31:52,040 --> 00:31:55,240
Speaker 2: as a result of infrastructure issues here. Just very briefly,

641
00:31:55,920 --> 00:31:58,320
Speaker 2: how could that reign in data center growth and development

642
00:31:58,320 --> 00:32:00,920
Speaker 2: here in the US if that were and is some

643
00:32:00,960 --> 00:32:02,280
Speaker 2: sort of boundary or barrier.

644
00:32:02,920 --> 00:32:05,680
Speaker 14: Yeah, it's one of the biggest risks going into twenty

645
00:32:05,720 --> 00:32:08,680
Speaker 14: twenty six, the energy bottlenecks, and more so into twenty

646
00:32:08,680 --> 00:32:11,400
Speaker 14: seven and twenty eight, right as we start transforming and

647
00:32:11,480 --> 00:32:15,160
Speaker 14: changing the narrative from the bookings growth expectations to one

648
00:32:15,240 --> 00:32:19,240
Speaker 14: where it's also all about execution of these data center buildouts.

649
00:32:19,640 --> 00:32:24,000
Speaker 2: Luzino, Senior equity analyst at CFRI Research. Happy Thanksgiving, Thanks

650
00:32:24,000 --> 00:32:26,959
Speaker 2: so much for joining us Well. Mckensey cut about two

651
00:32:27,080 --> 00:32:29,320
Speaker 2: hundred global tech jobs in the past week as the

652
00:32:29,360 --> 00:32:33,080
Speaker 2: consulting firm joins Rivals and using AI to automate some positions,

653
00:32:33,440 --> 00:32:36,720
Speaker 2: and sources say the company is closely assessing what tasks

654
00:32:36,760 --> 00:32:39,680
Speaker 2: can be carried out by AI and isn't ruling out

655
00:32:39,680 --> 00:32:43,480
Speaker 2: additional reductions across different functions over the next two years

656
00:32:43,800 --> 00:32:47,160
Speaker 2: this as it ramps up use of the tech coming

657
00:32:47,200 --> 00:32:50,680
Speaker 2: up one our music settles a copyright lawsuit against AI startups,

658
00:32:50,680 --> 00:32:53,800
Speaker 2: So no more on that. Next this is Bloomberg Tech.

659
00:33:06,480 --> 00:33:09,600
Speaker 2: Warner Music Group and AI music creator Suno have settled

660
00:33:09,600 --> 00:33:12,000
Speaker 2: a copyright lawsuit and agreed on a new partnership in

661
00:33:12,040 --> 00:33:15,240
Speaker 2: creating music. Suno was accused by Warner Music and other

662
00:33:15,360 --> 00:33:18,920
Speaker 2: major record labels for using copyrighted material without compensating artists

663
00:33:19,000 --> 00:33:21,959
Speaker 2: or their companies. For the latest Bloomberg Music and podcast

664
00:33:22,040 --> 00:33:25,520
Speaker 2: reporter Ashley Carmen joins us now and for people aren't

665
00:33:25,520 --> 00:33:27,760
Speaker 2: for people to understand Warner Music in the music industry

666
00:33:27,760 --> 00:33:29,320
Speaker 2: and where publishers and labels fall in.

667
00:33:29,360 --> 00:33:30,640
Speaker 3: But where do sooner fall into this?

668
00:33:31,320 --> 00:33:33,840
Speaker 15: Well, that's the big question. So Suno and its competitor

669
00:33:33,920 --> 00:33:36,440
Speaker 15: Udio have really found a business in allowing people to

670
00:33:36,480 --> 00:33:39,160
Speaker 15: type in prompts and gift songs in return. And so

671
00:33:39,240 --> 00:33:41,960
Speaker 15: now the big question is is this competition for the

672
00:33:41,960 --> 00:33:46,600
Speaker 15: traditional record labels? Probably? Is this a tool for artists

673
00:33:46,720 --> 00:33:49,920
Speaker 15: human artists? Probably? And what does this actually mean for

674
00:33:49,960 --> 00:33:51,640
Speaker 15: the business? And so this deal is kind of a

675
00:33:51,720 --> 00:33:53,880
Speaker 15: landmark moment in that entire dialogue.

676
00:33:53,920 --> 00:33:57,360
Speaker 2: Is there like a historical corollary or parallel.

677
00:33:56,880 --> 00:33:57,560
Speaker 3: We can draw here.

678
00:33:57,640 --> 00:33:59,880
Speaker 2: Is this like when Steve Jobs unbundled the album and

679
00:34:00,280 --> 00:34:02,600
Speaker 2: let us download one song for a ninety nine cents?

680
00:34:02,680 --> 00:34:03,920
Speaker 3: Is it a bigger deal than that?

681
00:34:04,240 --> 00:34:06,680
Speaker 15: People like to compare it to the Napster moment, where

682
00:34:06,760 --> 00:34:08,960
Speaker 15: this could really be a paradigm shift. Yeah, how people

683
00:34:09,000 --> 00:34:13,120
Speaker 15: create music, how they consume music, where they consume music,

684
00:34:13,200 --> 00:34:16,080
Speaker 15: where they create music. So it gets a lot of comparisons.

685
00:34:16,080 --> 00:34:18,840
Speaker 15: And I think, unlike that moment where the record labels

686
00:34:18,880 --> 00:34:20,759
Speaker 15: and Napster were really at odds for years and it

687
00:34:20,840 --> 00:34:23,680
Speaker 15: basically creted the entire music business. They want to start

688
00:34:23,680 --> 00:34:26,720
Speaker 15: making partnerships and actually have a hand in this business.

689
00:34:26,800 --> 00:34:27,880
Speaker 3: What do artists think of this?

690
00:34:28,040 --> 00:34:30,760
Speaker 2: Because in that moment, and I live through the Napster moment,

691
00:34:30,840 --> 00:34:33,760
Speaker 2: I mean, guilty is charged. Don't get me in trouble

692
00:34:33,800 --> 00:34:38,600
Speaker 2: for that. But artists were understandably really upset, and you know,

693
00:34:38,600 --> 00:34:40,680
Speaker 2: you had Lars Lrick on one side from Metallica.

694
00:34:40,680 --> 00:34:42,719
Speaker 3: It was a really big deal. Where do artists fall

695
00:34:42,719 --> 00:34:43,320
Speaker 3: in this debate?

696
00:34:44,000 --> 00:34:46,200
Speaker 15: Artists are using these tools in the studios. I go

697
00:34:46,239 --> 00:34:47,640
Speaker 15: to the studios and I say, do you use AI

698
00:34:47,680 --> 00:34:50,040
Speaker 15: and They're like, yeah, we do. But at the same time,

699
00:34:50,040 --> 00:34:53,279
Speaker 15: I think they don't want wholly AI generated songs to

700
00:34:53,320 --> 00:34:56,400
Speaker 15: come in and take market share away from human created works.

701
00:34:56,560 --> 00:34:58,919
Speaker 2: But is there also this understanding that there wasn't then

702
00:34:59,040 --> 00:35:01,120
Speaker 2: that for our an artists to make money they need

703
00:35:01,160 --> 00:35:02,680
Speaker 2: to do more than just create the music.

704
00:35:03,680 --> 00:35:05,120
Speaker 15: I mean, this is this is the thing, is that

705
00:35:05,160 --> 00:35:08,200
Speaker 15: business is shifting so much. Streaming brought the industry back

706
00:35:08,200 --> 00:35:11,440
Speaker 15: from piracy, but it also meant that now so many

707
00:35:11,480 --> 00:35:13,120
Speaker 15: people can upload their music, they don't need to go

708
00:35:13,120 --> 00:35:15,160
Speaker 15: through a distributor to be in retail stores. It means

709
00:35:15,160 --> 00:35:17,160
Speaker 15: they have to tour. It means they need to create merch.

710
00:35:17,200 --> 00:35:19,080
Speaker 15: It means they need to build these super fans to

711
00:35:19,160 --> 00:35:20,240
Speaker 15: keep that business going.

712
00:35:20,440 --> 00:35:24,279
Speaker 2: Bloomberg's actually Carmen joining us. Thanks so much, Ashley, Happy Thanksgiving.

713
00:35:24,640 --> 00:35:27,080
Speaker 2: Let's turn out a Warner Brothers Discovery stay on Media.

714
00:35:27,160 --> 00:35:30,560
Speaker 2: The company asking bidders for swedened offers by December. This

715
00:35:30,680 --> 00:35:33,560
Speaker 2: December first actually, as it explores options for a sale.

716
00:35:33,680 --> 00:35:36,520
Speaker 2: Bloomberg's media reporter Hannah Miller has been reporting on the

717
00:35:36,560 --> 00:35:39,640
Speaker 2: saga and she joins us. Now, So, Hannah, who are

718
00:35:39,680 --> 00:35:42,280
Speaker 2: the companies that are at play right now for these assets.

719
00:35:42,520 --> 00:35:46,440
Speaker 16: Yeah, so we have Paramount, Comcasts and Netflix. They all

720
00:35:46,440 --> 00:35:50,240
Speaker 16: have some differences with their bids with the obstacles facing

721
00:35:50,280 --> 00:35:54,280
Speaker 16: them here. But those are the players going for Warner

722
00:35:54,280 --> 00:35:55,640
Speaker 16: Brothers Discoveries assets.

723
00:35:55,960 --> 00:35:57,799
Speaker 2: Do they all want the same assets or do they

724
00:35:57,800 --> 00:35:58,760
Speaker 2: want different assets?

725
00:35:59,000 --> 00:36:01,520
Speaker 16: So Comcasts and net Flix they're going for streaming and

726
00:36:01,600 --> 00:36:06,200
Speaker 16: studios they want, you know, those big profit sectors for

727
00:36:06,320 --> 00:36:10,680
Speaker 16: Warner Brothers Discovery. Paramount wants the whole thing. There'll take

728
00:36:10,719 --> 00:36:12,719
Speaker 16: the cable networks too, even though we've seen so many

729
00:36:12,760 --> 00:36:15,760
Speaker 16: people cut the cord and shift from cable to streaming.

730
00:36:16,160 --> 00:36:19,279
Speaker 2: From a regulatory perspective, is that a harder Is that

731
00:36:19,320 --> 00:36:22,000
Speaker 2: a harder barrier? Does it kind of not matter given

732
00:36:22,400 --> 00:36:25,719
Speaker 2: what we've seen from this administration and the way that

733
00:36:25,760 --> 00:36:27,920
Speaker 2: media has changed in recent years, because there could there

734
00:36:27,920 --> 00:36:29,759
Speaker 2: you know, CNN is part of that, and CNN and

735
00:36:29,800 --> 00:36:32,799
Speaker 2: CBS living side by side a network and cable when

736
00:36:32,800 --> 00:36:34,160
Speaker 2: it comes to news, that could be a challenge.

737
00:36:34,200 --> 00:36:36,520
Speaker 16: Now, Yeah, it's a great question. It's something a lot

738
00:36:36,520 --> 00:36:40,680
Speaker 16: of investors are thinking about. With Paramount. We know that

739
00:36:41,000 --> 00:36:44,799
Speaker 16: the CEO, David Ellison, he's spoken about the positive relationship

740
00:36:45,080 --> 00:36:48,239
Speaker 16: that he has with President Trump, So that could help

741
00:36:48,280 --> 00:36:51,520
Speaker 16: smooth things over on a regulatory front. The thing with

742
00:36:51,640 --> 00:36:56,239
Speaker 16: Netflix is that there are questions about if both streaming

743
00:36:56,360 --> 00:37:00,239
Speaker 16: services were under Netflix, if HBO Max got added to Netflix,

744
00:37:01,000 --> 00:37:03,840
Speaker 16: would they dominate and have too much market share?

745
00:37:04,120 --> 00:37:07,560
Speaker 2: Wow, I can't believe we're talking about streamers and antitrust.

746
00:37:07,760 --> 00:37:10,040
Speaker 2: That's kind of where we are in this world, Hannah,

747
00:37:10,040 --> 00:37:11,879
Speaker 2: before we let you go, David Allison is one David

748
00:37:11,880 --> 00:37:14,719
Speaker 2: we're thinking about. David Zaslov is another David that we're

749
00:37:14,719 --> 00:37:16,480
Speaker 2: thinking about over at Warner Brothers Discovery.

750
00:37:16,520 --> 00:37:17,560
Speaker 3: What happens to him after this?

751
00:37:17,920 --> 00:37:21,120
Speaker 16: Yeah, so the role he plays with whatever shakes out,

752
00:37:21,320 --> 00:37:24,560
Speaker 16: that is a big factor here. We know he's someone

753
00:37:24,640 --> 00:37:27,400
Speaker 16: who still wants to stay in the mix, and I

754
00:37:27,400 --> 00:37:30,400
Speaker 16: think a lot of the investors, the shareholders, they're all

755
00:37:30,440 --> 00:37:34,799
Speaker 16: thinking about what role Zazov will play after a deal.

756
00:37:35,120 --> 00:37:37,680
Speaker 2: Bloomberg's Hannah Miller. Hopefully she's not too busy during the

757
00:37:37,719 --> 00:37:39,959
Speaker 2: holidays staying on top of this deal. Appreciate you taking

758
00:37:39,960 --> 00:37:42,160
Speaker 2: the time. Well, coming up, we're going to talk to

759
00:37:42,200 --> 00:37:45,760
Speaker 2: the startup that's using AI to help restaurants identify ingredients

760
00:37:45,800 --> 00:37:48,920
Speaker 2: that could be allergens or restricted under some diets. It's

761
00:37:48,920 --> 00:37:51,919
Speaker 2: an issue restaurants chains from California soon won't be able

762
00:37:51,960 --> 00:38:07,879
Speaker 2: to ignore. This is Bloomberg Tech. Well, if any part

763
00:38:07,880 --> 00:38:09,960
Speaker 2: of your thanks Evin Jenner is being ordered or coming

764
00:38:10,000 --> 00:38:12,160
Speaker 2: from a restaurant, you might have had to ask about

765
00:38:12,200 --> 00:38:14,960
Speaker 2: the ingredient list to check any allergens for your guests.

766
00:38:15,400 --> 00:38:18,160
Speaker 2: It's an issue that goes far beyond Thanksgiving, with millions

767
00:38:18,200 --> 00:38:22,080
Speaker 2: of Americans with allergies or dietary restrictions struggling when they

768
00:38:22,120 --> 00:38:24,919
Speaker 2: go out to eat. Startup Fudini is aiming to solve

769
00:38:24,960 --> 00:38:27,560
Speaker 2: this problem with an AI tool to help restaurants thoroughly

770
00:38:27,600 --> 00:38:32,320
Speaker 2: and clearly label ingredients. Fudini COEO. Dylan McDonald joins us. Now, Dylan,

771
00:38:32,360 --> 00:38:34,040
Speaker 2: you've got a really interesting story. I think, like so

772
00:38:34,120 --> 00:38:37,360
Speaker 2: many startups, it comes from a place of necessity for

773
00:38:37,480 --> 00:38:39,680
Speaker 2: the founder. Talk to us a little bit about what

774
00:38:39,719 --> 00:38:40,359
Speaker 2: you've dealt with.

775
00:38:41,640 --> 00:38:43,640
Speaker 17: Yeah, first, see Tim, thanks very much for having me.

776
00:38:43,719 --> 00:38:46,560
Speaker 17: Great to be here. And yeah, like you mentioned.

777
00:38:46,280 --> 00:38:49,880
Speaker 11: I diagnosed celiac when I was ten years old and

778
00:38:49,960 --> 00:38:53,120
Speaker 11: so have a lot of personal experience navigating dining out

779
00:38:53,160 --> 00:38:55,759
Speaker 11: of home and ordering online while needing to know what's

780
00:38:55,800 --> 00:38:58,319
Speaker 11: in my food and just over a long period of time,

781
00:38:58,440 --> 00:39:01,319
Speaker 11: got more and more for it with how difficult it

782
00:39:01,440 --> 00:39:04,920
Speaker 11: was to get that information and mistakes and inaccuracies, and

783
00:39:04,960 --> 00:39:06,560
Speaker 11: decided to try and do something about it.

784
00:39:06,640 --> 00:39:09,480
Speaker 2: So how can AI actually help restaurants do this? Because

785
00:39:09,520 --> 00:39:10,960
Speaker 2: you know, when you do look at a menu, when

786
00:39:11,000 --> 00:39:14,319
Speaker 2: you do talk to a server, I feel like in

787
00:39:14,360 --> 00:39:16,160
Speaker 2: this day and age, they have a good understanding of

788
00:39:16,200 --> 00:39:19,600
Speaker 2: at least some of the most common allergies like gluten

789
00:39:19,640 --> 00:39:23,399
Speaker 2: for example, and people who have celiac. So what does

790
00:39:23,440 --> 00:39:25,040
Speaker 2: AI allow them to take a step further?

791
00:39:25,080 --> 00:39:25,759
Speaker 3: How does it do that?

792
00:39:27,000 --> 00:39:28,839
Speaker 17: Yeah, it's a fair point. I think you're right.

793
00:39:28,840 --> 00:39:30,680
Speaker 11: I think a lot of restaurants have got on top

794
00:39:30,719 --> 00:39:34,359
Speaker 11: of gluten free, vegan, vegetarian, the main ones. But there's

795
00:39:34,360 --> 00:39:36,839
Speaker 11: one hundred and seventy three million Americans who have some

796
00:39:36,880 --> 00:39:40,440
Speaker 11: form of food energy or dietry requirement, and the allergens

797
00:39:40,520 --> 00:39:43,480
Speaker 11: go far beyond just you know, gluten and vegan. And

798
00:39:43,560 --> 00:39:46,600
Speaker 11: so what we do is we help restaurants by ingesting

799
00:39:46,640 --> 00:39:50,280
Speaker 11: their menu information, the recipe information, and the product information,

800
00:39:50,719 --> 00:39:54,160
Speaker 11: and we have trained large anguage models to break those

801
00:39:54,200 --> 00:39:56,880
Speaker 11: down to the ingredient level, tag them with the correct

802
00:39:56,920 --> 00:40:00,080
Speaker 11: allergen and dietary requirements and then we're able to to

803
00:40:00,280 --> 00:40:04,480
Speaker 11: power a personalized menu solution whereby consumers can see exactly

804
00:40:04,480 --> 00:40:06,880
Speaker 11: what they can and can't eat on the menu depending

805
00:40:06,920 --> 00:40:08,239
Speaker 11: on their personal requirements.

806
00:40:08,320 --> 00:40:10,680
Speaker 2: You have a background in law, your former corporate attorney,

807
00:40:10,800 --> 00:40:13,640
Speaker 2: and you know, I wonder about the liability element here.

808
00:40:13,960 --> 00:40:19,400
Speaker 2: You know, mistakes happen, mistakes get made, AI lms hallucinate. Well,

809
00:40:19,440 --> 00:40:21,000
Speaker 2: how do you protect around that and how do you

810
00:40:21,040 --> 00:40:22,719
Speaker 2: make sure that even if a food says it doesn't

811
00:40:22,760 --> 00:40:26,400
Speaker 2: have something, it doesn't become contaminated somewhere with that ingredient process.

812
00:40:27,520 --> 00:40:30,120
Speaker 17: Yeah, it's a great question. Firstly, on hallucinations.

813
00:40:30,239 --> 00:40:34,840
Speaker 11: Our technology never guesses if there is you know, it's

814
00:40:34,880 --> 00:40:37,560
Speaker 11: based on structured ingredient and supplier data.

815
00:40:37,640 --> 00:40:40,359
Speaker 17: If there's ever a scenario where it is ensure, it.

816
00:40:40,320 --> 00:40:42,520
Speaker 11: Will tag in the back end for us that it's

817
00:40:42,680 --> 00:40:45,360
Speaker 11: there's an uncertainty and our dietitian team will come in

818
00:40:45,440 --> 00:40:48,719
Speaker 11: over the top and do QA and manually intervene and

819
00:40:48,800 --> 00:40:51,400
Speaker 11: as you know, they make inputs into the system, the

820
00:40:51,640 --> 00:40:54,560
Speaker 11: LLM learns, it gets smarter and smarter over time. From

821
00:40:54,800 --> 00:40:58,160
Speaker 11: a legal liability standpoint, we would argue that not having

822
00:40:58,200 --> 00:41:01,799
Speaker 11: any documentation on our ergens is a much higher risk

823
00:41:02,040 --> 00:41:04,520
Speaker 11: because right now you have a consumer, a member of

824
00:41:04,640 --> 00:41:07,840
Speaker 11: staff who's likely not trained on all the ingredients and

825
00:41:07,920 --> 00:41:10,160
Speaker 11: all the allergens and all the menu items, and they're

826
00:41:10,200 --> 00:41:13,560
Speaker 11: the line of protection for the restaurant between the consumer

827
00:41:13,640 --> 00:41:17,480
Speaker 11: and a potentially life threatening a life threatening incident. And

828
00:41:17,520 --> 00:41:21,840
Speaker 11: fifty four percent of all allergic reactions and restaurants occur

829
00:41:22,239 --> 00:41:25,160
Speaker 11: after the staff have been notified. And so that tells

830
00:41:25,239 --> 00:41:27,120
Speaker 11: us that the current system of dealing with this by

831
00:41:27,160 --> 00:41:28,800
Speaker 11: word of mouth isn't working.

832
00:41:28,920 --> 00:41:30,600
Speaker 2: So, Dylan, how does it work? Is it a two

833
00:41:30,719 --> 00:41:33,719
Speaker 2: sided market where you have to get the restaurant or

834
00:41:33,760 --> 00:41:37,280
Speaker 2: the restaurant chain to add your technology, but then also

835
00:41:37,400 --> 00:41:40,000
Speaker 2: get people who have these allergies to use it.

836
00:41:41,160 --> 00:41:45,080
Speaker 11: Yeah, So we partner with the restaurant chains, food service operators.

837
00:41:45,160 --> 00:41:50,160
Speaker 11: We ingest their menu, recipe product technology from various tech stacts.

838
00:41:50,719 --> 00:41:52,719
Speaker 11: And then how it works typically is they put a

839
00:41:52,800 --> 00:41:55,760
Speaker 11: QRE code in venue on physical menus and menu boards

840
00:41:56,320 --> 00:41:59,040
Speaker 11: and a digital link on their website. This is the

841
00:41:59,040 --> 00:42:02,480
Speaker 11: most basic integrate, and then when consumers come into the

842
00:42:02,520 --> 00:42:06,080
Speaker 11: physical environment or digital environment, they scan the QRE. It

843
00:42:06,120 --> 00:42:08,480
Speaker 11: prompts them to create their dietary profile where they can

844
00:42:08,520 --> 00:42:11,480
Speaker 11: choose from over one hundred and fifty different allergens and

845
00:42:11,520 --> 00:42:15,080
Speaker 11: dietary requirements, and then instantly it will show them here's

846
00:42:15,160 --> 00:42:17,160
Speaker 11: exactly what you can eat, here's what you can eat

847
00:42:17,160 --> 00:42:19,760
Speaker 11: with a modifier, and what that modifier is, and here's

848
00:42:19,760 --> 00:42:22,719
Speaker 11: what you can't eat and why. So it's completely personalized

849
00:42:22,760 --> 00:42:26,000
Speaker 11: based on their requirements and the consumer discovers this In

850
00:42:26,040 --> 00:42:27,399
Speaker 11: the Restaurant's Environment.

851
00:42:27,160 --> 00:42:30,600
Speaker 2: Center Bill sixty eight in the state of California, this

852
00:42:30,880 --> 00:42:33,640
Speaker 2: is effective next week. It's going to require major chains

853
00:42:33,640 --> 00:42:37,640
Speaker 2: to provide detailed allergen info. Many people argue, this is

854
00:42:37,640 --> 00:42:41,320
Speaker 2: a major step toward transparency. How has that increased adoption

855
00:42:41,400 --> 00:42:41,960
Speaker 2: of your product?

856
00:42:43,160 --> 00:42:45,360
Speaker 11: Yeah, so just on that it was signed by Gavin

857
00:42:45,440 --> 00:42:48,080
Speaker 11: Usom a month ago. It becomes effect of one July

858
00:42:48,200 --> 00:42:48,719
Speaker 11: twenty six.

859
00:42:49,320 --> 00:42:49,920
Speaker 8: And so what in.

860
00:42:50,200 --> 00:42:54,400
Speaker 11: Essence requires is every restaurant chain and foods service facility

861
00:42:54,719 --> 00:42:57,920
Speaker 11: with twenty plus locations nationwide, where at least one of

862
00:42:57,920 --> 00:43:00,960
Speaker 11: those is in California, to label all of their physical

863
00:43:01,040 --> 00:43:04,680
Speaker 11: and digital menus for the major nine food origens. So

864
00:43:04,880 --> 00:43:07,920
Speaker 11: this is obviously a major step change for restaurants. They

865
00:43:07,960 --> 00:43:09,680
Speaker 11: can do it one of two ways they can either

866
00:43:09,800 --> 00:43:13,840
Speaker 11: physically annotate every one of their menu items with those origens,

867
00:43:14,360 --> 00:43:17,560
Speaker 11: or they can use a digital like a QR code

868
00:43:17,719 --> 00:43:20,440
Speaker 11: that links out to digital allergen menu. And that's obviously

869
00:43:20,520 --> 00:43:23,520
Speaker 11: what we do, and from speaking to a lot of

870
00:43:23,920 --> 00:43:26,440
Speaker 11: the bigger chains recently, as you might imagine, their strong

871
00:43:26,480 --> 00:43:30,400
Speaker 11: preferences to use a digital mechanism, and so we're getting

872
00:43:30,800 --> 00:43:33,080
Speaker 11: a lot more inbound then we certainly were a few

873
00:43:33,080 --> 00:43:34,480
Speaker 11: months ago, which is fantastic.

874
00:43:35,000 --> 00:43:36,399
Speaker 17: But we continue to work with like.

875
00:43:36,360 --> 00:43:40,760
Speaker 11: I said, with independence chains, food service facilities of all types.

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Speaker 2: Dylan McDonald, he's founder and CEO of Fudini, joining us

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Speaker 2: from Santa Monica, California. Well, that is going to do

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Speaker 2: it for this edition of Bloomberg Tech. Do not forget

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Speaker 2: to check out our podcast. You can find it on

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Speaker 2: the terminal as well as online at Apple, Spotify and

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Speaker 2: iHeart This is Bloomberg