WEBVTT - Roblox Slumps on Alleged Inflated Metrics, States Sue TikTok 0:00:01.440 --> 0:00:05.760 From Mahard where Innovation, Money and Power Collie in Silicon 0:00:05.840 --> 0:00:06.720 Vallet NBN. 0:00:07.040 --> 0:00:11.280 This is Bloomberg Technology with Caroline Hyde and Ed Loved Love. 0:00:24.520 --> 0:00:25.880 Live from New York and San Francisco. 0:00:26.120 --> 0:00:29.560 This is Bloomberg Technology coming up short seller Hinduburg Research 0:00:29.600 --> 0:00:33.519 but against roadblocks based on what it calls inflated key 0:00:33.600 --> 0:00:36.120 metrics and a lack of child safety. 0:00:36.800 --> 0:00:39.800 And TikTok gets sued in California, New York and other 0:00:39.880 --> 0:00:44.000 states for deceiving users about its safety for children. 0:00:44.320 --> 0:00:46.760 Plus, we hear from JP Morgan CEO Jamie Diamond on 0:00:46.800 --> 0:00:49.400 a AI in an exclusive interview at the firm's tech 0:00:49.440 --> 0:00:51.520 Stars conference in Europe. 0:00:51.920 --> 0:00:53.960 But first we go straight. 0:00:53.720 --> 0:00:56.840 To shares of Roadblocks, which are tumbling today after short 0:00:56.880 --> 0:01:00.680 seller Hindenburg Research said it's vetting against the Gaming Plan platform, 0:01:00.720 --> 0:01:04.080 saying in its report that it has inflated key metrics 0:01:04.400 --> 0:01:06.800 and also focusing in on a lack of safety for 0:01:06.920 --> 0:01:08.319 children on the platform. 0:01:08.720 --> 0:01:10.880 We go to Bloomberg's Bailey Lipschutz for more. 0:01:11.040 --> 0:01:17.040 First, the accusations of people of key metrics, time spent engagement. 0:01:17.440 --> 0:01:19.959 What are they accusing hinden By Research, Well. 0:01:19.800 --> 0:01:22.120 That's the big thing Carol is that this is a 0:01:22.200 --> 0:01:26.600 new take from the short seller Nate Anderson Hindenberg targeting 0:01:26.640 --> 0:01:30.160 that they are inflating or, according to Hindenberg, are inflating 0:01:30.160 --> 0:01:33.880 some of those metrics to appease investors. We've seen long 0:01:33.959 --> 0:01:37.279 discuss the issues potentially with the platform and child safety. 0:01:37.319 --> 0:01:40.040 Bloomberg had a terrific big take in the summer titled 0:01:40.120 --> 0:01:44.360 Roadblocks Pedophile Problem. So that has been a well discussed aspect. 0:01:44.520 --> 0:01:47.520 But those kind of allegations from Hindenburg that they have 0:01:47.600 --> 0:01:50.800 been inflating some of those metrics. Again, the company says 0:01:50.880 --> 0:01:53.440 that they reject those deemed in the report. 0:01:53.480 --> 0:01:54.560 But that's what's new. 0:01:54.520 --> 0:01:56.960 Is that the company could at least again if you 0:01:57.000 --> 0:01:59.800 take Hindenburger face value they're betting against, the company could 0:01:59.800 --> 0:02:02.800 be boosting some of those numbers to lay any investor 0:02:02.840 --> 0:02:04.720 concerns that maybe they don't have the reach or the 0:02:04.760 --> 0:02:06.840 engagement that Wall Street is looking for. 0:02:07.480 --> 0:02:10.919 Bailey, let's go to Roadblocks's response in full in New York. 0:02:11.000 --> 0:02:12.320 Let's bring it up on the screen. 0:02:12.880 --> 0:02:15.400 We totally reject the claims made in the report. The 0:02:15.440 --> 0:02:19.400 financial claims made by Hindenburg Research are simply misleading. The 0:02:19.440 --> 0:02:23.440 authors are emittedly short sellers and have an angender irrespective 0:02:23.520 --> 0:02:26.800 of the substance of Roadblocks's business model and results. 0:02:26.800 --> 0:02:27.480 And what they go on. 0:02:27.480 --> 0:02:31.760 To say is kind of a pushback against the thesis 0:02:32.160 --> 0:02:36.440 at the center of Hindenburg's research, which is because this 0:02:36.520 --> 0:02:41.560 is a company which Hindenburg claims isn't profitable, that the 0:02:41.639 --> 0:02:44.400 claim is they're misleading investors because they rely on a 0:02:44.480 --> 0:02:48.359 daily active user number and a people number that are 0:02:48.360 --> 0:02:51.480 the same. And if you read the footnotes of the disclosures, 0:02:51.520 --> 0:02:54.080 the footnotes read you shouldn't rely on the daily active 0:02:54.160 --> 0:02:57.200 user number because it could include box or it could 0:02:57.400 --> 0:03:01.280 include alt accounts. In other words, one user holds multiple accounts. 0:03:01.400 --> 0:03:04.119 It's a hard one to follow, but just go over 0:03:04.160 --> 0:03:05.919 the back and forth between the two parties. 0:03:05.960 --> 0:03:08.200 Bailey, No, to your point, edit, when you look at 0:03:08.240 --> 0:03:12.239 how Roadblocks or really any other media or video gaming 0:03:12.280 --> 0:03:14.919 platform is valued, whether you want to point to is 0:03:14.960 --> 0:03:17.120 the company did the amount of cash receipts or their 0:03:17.160 --> 0:03:19.919 bookings growth. That is bullish for the company in their view. 0:03:19.960 --> 0:03:22.800 But to your point, what Hindenburg has laid out looking 0:03:22.840 --> 0:03:25.320 at those metrics, they're looking at profitability at a string 0:03:25.360 --> 0:03:30.160 of unprofitable quarters, you really have to take it into consideration. Again, 0:03:30.280 --> 0:03:32.680 Hindenburg is betting against the company. The company is down 0:03:32.760 --> 0:03:35.200 seventy percent from its all time high back in twenty 0:03:35.240 --> 0:03:37.560 twenty one. It has been on a string of losing 0:03:38.720 --> 0:03:42.119 kind of down days, down about thirteen fourteen percent from 0:03:42.120 --> 0:03:44.640 a September high. So it really depends how you want 0:03:44.680 --> 0:03:45.160 to valuate. 0:03:45.320 --> 0:03:46.920 You can point through any. 0:03:46.680 --> 0:03:49.400 Short seller report really and say that they're cherry picking data, 0:03:49.440 --> 0:03:52.280 which seems to be kind of what Roadblocks is doing here. 0:03:52.360 --> 0:03:53.560 But also on the flip. 0:03:53.320 --> 0:03:56.440 Side, if you're an investor who's long the stock, you 0:03:56.520 --> 0:03:58.600 need to understand and kind of wrap your mind around 0:03:58.600 --> 0:04:00.280 the totality of that data. 0:04:00.320 --> 0:04:01.400 But that also could just be. 0:04:01.440 --> 0:04:03.960 Why we're seeing Roadblocks down four percent, kind of pairing 0:04:04.040 --> 0:04:05.040 back some of those losses. 0:04:05.120 --> 0:04:06.880 I do just want to call out that we're at. 0:04:06.800 --> 0:04:09.840 About nine times what is normal in terms of trading volume, 0:04:09.880 --> 0:04:13.440 more than seventeen million shares already changing hands in the 0:04:13.440 --> 0:04:16.039 first hour and a half of today, which really is 0:04:16.120 --> 0:04:18.360 more than we would normally see in an entire session. 0:04:19.080 --> 0:04:22.240 We have Roblocks's response, and of course they've long been 0:04:22.279 --> 0:04:26.479 trying to show off ways in which they're trying to 0:04:26.480 --> 0:04:28.400 take on the safety concerns as well. 0:04:28.920 --> 0:04:30.520 I'm interested in that this isn't the only. 0:04:30.440 --> 0:04:33.200 Voice of a bearish nature though, And we've heard from 0:04:33.360 --> 0:04:37.400 Edwin Dorsey, for example, who writes multiple bearish cases, and 0:04:37.400 --> 0:04:39.239 actually he doesn't take any. 0:04:39.080 --> 0:04:39.960 Bets on the stock. 0:04:40.040 --> 0:04:43.760 He just outlines why he's perhaps concerned about particular companies. 0:04:44.080 --> 0:04:46.960 So is this a mounting view of concerns around numbers 0:04:47.120 --> 0:04:48.120 or is this the first. 0:04:47.839 --> 0:04:50.240 Time I think when it as it relates directly to 0:04:50.640 --> 0:04:53.640 the user metrics, again, that is new. Is from my understanding, 0:04:53.680 --> 0:04:56.200 that is not what Edwin Dorsey has targeted. That is 0:04:56.240 --> 0:04:59.080 not what Bloomberg and other outlets have reported primarily around 0:04:59.160 --> 0:05:03.960 child safety potentially putting profits over people. But these allegations 0:05:04.080 --> 0:05:07.400 in terms of potentially inflating numbers, to my knowledge, is 0:05:07.440 --> 0:05:10.000 new and I have read and read, as I'm sure 0:05:10.920 --> 0:05:13.000 a number of viewers do have read a lot of 0:05:13.000 --> 0:05:15.400 what Edwin Dorsey and Barcave put out. And again they've 0:05:15.400 --> 0:05:17.600 been publishing on this company for quite some time. In 0:05:17.800 --> 0:05:21.720 their most recent report was just earlier this week, kind 0:05:21.720 --> 0:05:24.120 of incorporating some of their metrics and their latest report 0:05:24.120 --> 0:05:27.120 from last week. But that really from the Bearcape perspective. 0:05:27.279 --> 0:05:29.359 For the most part, at least what I've read, focuses 0:05:29.360 --> 0:05:31.719 more on child safety profits and some of the or 0:05:31.800 --> 0:05:32.839 lack of safeguards. 0:05:33.480 --> 0:05:34.039 That is right. 0:05:34.080 --> 0:05:36.280 They are different vcs in that respect, and we made 0:05:36.320 --> 0:05:39.520 every effort to invite Hindenberg and Nate Anderson on this program, 0:05:39.560 --> 0:05:42.800 and we've made every effort to invite roadblocks onto Bloombo's 0:05:42.800 --> 0:05:45.760 Baya Lipshaltz. Thank you very much. Another breaking news story 0:05:45.760 --> 0:05:49.520 this morning. TikTok was sued by California, New York and 0:05:49.560 --> 0:05:54.159 a dozen other states Tuesday for allegedly deceiving users about 0:05:54.200 --> 0:05:58.320 its safety for children and using harmful and addictive features 0:05:58.640 --> 0:06:02.440 to keep children on the platform for longer to maximize profits. 0:06:02.480 --> 0:06:05.960 TikTok has not responded to a request for comment. Bluebags 0:06:05.960 --> 0:06:08.760 Mike Shepherd joins us out of DC. Just explain the 0:06:08.760 --> 0:06:12.400 basics of the action taken by these states, the mechanism 0:06:12.440 --> 0:06:15.640 by how they took it, and what the claim is. 0:06:16.960 --> 0:06:20.560 Well, the states have worked together in this claim against TikTok, 0:06:20.640 --> 0:06:24.680 as you described, going after the company over what the 0:06:24.720 --> 0:06:28.920 state Attorney's General call harmful behavior to the public. In 0:06:28.960 --> 0:06:33.560 other words, baking in harmful and addictive features into the algorithm, 0:06:33.760 --> 0:06:37.159 into the software, into this platform that children are using, 0:06:37.560 --> 0:06:41.440 so that they are hooked, so that it keeps them 0:06:41.480 --> 0:06:43.680 on as repeat customers, so that they stay on the 0:06:43.720 --> 0:06:49.120 platform longer. This includes things like endless scrolling. It also 0:06:49.200 --> 0:06:53.279 includes features like beauty filters and comments and likes that 0:06:53.320 --> 0:06:56.840 can also harm children's self esteem. All of this, they 0:06:56.839 --> 0:07:01.000 are saying, is causing a public health crisis among young people, 0:07:01.080 --> 0:07:04.560 and they are taking steps to try to address it. 0:07:05.520 --> 0:07:08.440 There's not the only lawsuit, of course, There's been a barrage. 0:07:08.440 --> 0:07:11.560 There was a federal lawsuit just in August claiming TikTok 0:07:11.880 --> 0:07:15.320 allowed children to open accounts and gathered information about them when. 0:07:15.200 --> 0:07:16.160 They shouldn't have been. 0:07:16.800 --> 0:07:20.880 What's interesting is TikTok, like Meta, like many other companies 0:07:20.920 --> 0:07:22.520 when it comes to social media and children, and in 0:07:22.600 --> 0:07:23.520 putting in place what. 0:07:23.480 --> 0:07:24.760 They say are safeguards. 0:07:24.760 --> 0:07:27.800 You've got all accounts for teens under eighteen starting out 0:07:27.800 --> 0:07:30.320 as private, they say, and a screen limit of some 0:07:30.400 --> 0:07:33.640 sixty minutes. What's interesting in this case is that the 0:07:33.680 --> 0:07:36.560 attorneys general take issue with those sorts of safety precautions, 0:07:36.600 --> 0:07:37.640 saying they're not really real. 0:07:38.920 --> 0:07:40.960 Well, that's right, and in fact, in the case that 0:07:41.000 --> 0:07:42.960 you mentioned, I'm so glad you brought it up, Carol. 0:07:43.480 --> 0:07:46.640 In August, the Federal Trade Commission sued the company for 0:07:46.720 --> 0:07:49.640 failing to abide by the terms of a twenty nineteen 0:07:50.080 --> 0:07:53.560 settlement over child privacy. In both of these cases, what 0:07:53.840 --> 0:07:57.040 the federal government and then the state attorney's general are 0:07:57.080 --> 0:08:00.120 alleging is that these measures have not been enough, and 0:08:00.160 --> 0:08:03.760 in fact, in the case brought u by California today 0:08:03.800 --> 0:08:07.120 in the other states, they are saying that children's private 0:08:07.240 --> 0:08:11.080 data was being exploited without parental consent or notice, and 0:08:11.280 --> 0:08:14.520 that is just a fundamental, in their view, violation of 0:08:14.520 --> 0:08:17.600 that relationship with children under the age of thirteen. 0:08:18.280 --> 0:08:20.760 Mike Shepard, We appreciate it. Thank you. 0:08:21.640 --> 0:08:24.720 Now let's turn our attention to South Korean tech giant Samsung, 0:08:24.960 --> 0:08:28.679 issuing a rare apology to investors after it posted disappointing results, 0:08:29.000 --> 0:08:32.160 admitting that it's grappling with a potential crisis after losing 0:08:32.240 --> 0:08:35.200 its way. The newly appointed head of Samsung's core chip 0:08:35.200 --> 0:08:38.520 business has promised to overhaul the organization and began laying 0:08:38.559 --> 0:08:42.319 off workers last week in Southeast Asia, Australia and New Zealand. 0:08:42.600 --> 0:08:45.480 As part of a plan to reduce global headcount ed. 0:08:46.400 --> 0:08:49.400 Okay, Coming up on Bloomberg Technology, Rivian hits a snag 0:08:49.440 --> 0:08:52.160 in its supply chain, throwing a wrench in twenty twenty 0:08:52.200 --> 0:08:54.680 four production targets. One of the stories will bring you 0:08:54.760 --> 0:08:57.319 later in the hour. Take a look at shares Nvidia. 0:08:57.440 --> 0:08:59.920 It's off its session high where it touched again of 0:09:00.080 --> 0:09:02.720 four percent, but that would make the stock trading its 0:09:02.760 --> 0:09:04.760 highest level since mid July. 0:09:05.320 --> 0:09:06.840 It's interesting they're holding. 0:09:06.559 --> 0:09:09.280 Their AI summit DC right now where they're talking up 0:09:09.320 --> 0:09:13.280 Blackwell and they're talking up about how energy efficient it is, 0:09:13.559 --> 0:09:17.440 trying to overcome concerns about power consumption in the context 0:09:17.480 --> 0:09:20.520 of GPUs that go into data centers. We continue to 0:09:20.600 --> 0:09:22.960 track in VideA for obvious reasons. 0:09:23.160 --> 0:09:25.679 Stay with us. This is Bloomberg Technology. 0:09:35.040 --> 0:09:37.840 Amazon is set to face an antitrust suit filed by 0:09:37.840 --> 0:09:41.480 the US Federal Trade Commission over complaints that its online 0:09:41.559 --> 0:09:46.120 marketplace practice is harmed competition. Bloomberg's lear Nyland joins US 0:09:46.120 --> 0:09:48.120 our of DC and laya, give me the basics of 0:09:48.160 --> 0:09:49.880 the complaint and the process. 0:09:51.280 --> 0:09:51.480 Yeah. 0:09:51.520 --> 0:09:55.480 The FDC filed this complaint a year ago in September, 0:09:55.800 --> 0:10:01.600 alleging that Amazon has harmed merchants who use its online 0:10:01.640 --> 0:10:06.000 marketplace through a variety of tactics. Amazon of course denies 0:10:06.120 --> 0:10:11.840 the allegations and filed a request that the court throw out. 0:10:11.720 --> 0:10:13.959 The complaint at this early stage. 0:10:14.640 --> 0:10:18.160 That's pretty unusual, but Meta was successful in the first 0:10:18.240 --> 0:10:20.360 round when it did that against the FTC complaint, or 0:10:20.400 --> 0:10:23.800 Amazon tried as well. The judge recently released his decision 0:10:24.679 --> 0:10:27.840 and he agreed to toss out just a couple of 0:10:27.880 --> 0:10:33.320 allegations under various state law claims that Amazon's marketplace violates 0:10:33.320 --> 0:10:36.599 state consumer protection laws. But he ruled that the FTC's 0:10:36.840 --> 0:10:38.960 complaint can move forward, which is a pretty big blow 0:10:38.960 --> 0:10:42.720 to Amazon. Amazon had said made a bunch of arguments 0:10:42.800 --> 0:10:45.720 that you know, its marketplace is designed to help consumers, 0:10:46.400 --> 0:10:49.200 all of its algorithms are designed to help lower prices, 0:10:49.440 --> 0:10:51.320 and the judge just said that may be the case, 0:10:51.360 --> 0:10:53.440 but at this point in the suit, like, I can't 0:10:53.440 --> 0:10:55.680 really consider that. We have to move forward a little 0:10:55.679 --> 0:10:58.400 bit before Amazon is allowed to make those kinds of arguments. 0:10:58.880 --> 0:11:02.680 Okay, so Amaz in front and center, but so too 0:11:02.800 --> 0:11:05.960 is Alphabet at the moment in multiple ways. We're expecting 0:11:06.040 --> 0:11:09.920 yet further updates in terms of concerns around its own 0:11:10.200 --> 0:11:11.480 marketplace today, I believe. 0:11:12.760 --> 0:11:16.040 Yeah, so yesterday in the Google Place or case, this 0:11:16.160 --> 0:11:17.959 is an anti trust case that was going on out 0:11:18.000 --> 0:11:19.320 in California. 0:11:18.840 --> 0:11:20.319 Involving Epic Games. 0:11:21.080 --> 0:11:24.320 The judge in that case imposed an injunction on Google 0:11:24.360 --> 0:11:30.360 that's going to ban it from paying developers or manufacturers 0:11:30.679 --> 0:11:32.200 to make its place. 0:11:31.960 --> 0:11:33.440 Or the default one on its device. 0:11:33.679 --> 0:11:36.840 So it can no longer pay developers to exclusively launch 0:11:37.600 --> 0:11:40.240 their apps and the app store. It has to allow 0:11:40.440 --> 0:11:43.960 other companies that want to, like perhaps Amazon or Microsoft, 0:11:44.240 --> 0:11:49.280 to offer alternate app stores for Android devices. And this 0:11:49.559 --> 0:11:53.640 lasts for three years. The idea is that Google has 0:11:53.679 --> 0:11:54.319 made all of. 0:11:54.280 --> 0:11:57.200 These provisions and its rules. 0:11:57.440 --> 0:12:00.520 Related to the app store that really harmed competition found 0:12:00.600 --> 0:12:03.839 last year, and so this three year prohibition on paying 0:12:03.880 --> 0:12:07.679 developers to launch exclusively and being forced to allow other 0:12:07.679 --> 0:12:11.559 app stores is to help develop more app stores in 0:12:11.600 --> 0:12:12.960 the Android ecosystem. 0:12:13.720 --> 0:12:15.720 So Google is going to appeal. 0:12:15.760 --> 0:12:18.480 Of course, they already announced that yesterday, so this isn't 0:12:18.520 --> 0:12:21.840 going to go into effect immediately, but you know, there 0:12:21.960 --> 0:12:25.240 was an immediate impact on the stock price because you know, 0:12:25.400 --> 0:12:28.160 this is a fourteen billion dollar year business for Google, 0:12:28.520 --> 0:12:32.240 and it's going to definitely impact the amount of revenue 0:12:32.280 --> 0:12:37.800 they make each year. Separately today, sorry, carry on separately today. 0:12:37.960 --> 0:12:39.880 In the search case, this is the one that the 0:12:40.000 --> 0:12:44.439 Justice Department filed in twenty twenty. The judge ruled earlier 0:12:44.480 --> 0:12:47.680 this year that Google has an illegal monopoly in online 0:12:47.679 --> 0:12:50.360 search and online search ads, and the Justice Department is 0:12:50.400 --> 0:12:54.360 supposed to make its first proposal sometime later today about 0:12:54.400 --> 0:12:57.040 what it thinks Google should be forced to do to 0:12:57.080 --> 0:12:59.920 sort of remedy the harm caused in the online search market. 0:13:00.640 --> 0:13:03.160 You know, we had reported a couple months ago that 0:13:03.200 --> 0:13:06.280 one of the options that they might be proposing as 0:13:06.320 --> 0:13:08.679 a breakup. So this could be the first time that 0:13:08.720 --> 0:13:11.120 the federal government is looking to break up a company 0:13:11.520 --> 0:13:12.360 in decades. 0:13:12.600 --> 0:13:14.720 So we're sort of eagerly awaiting that here in. 0:13:14.800 --> 0:13:19.720 DC Search app Store and over Amazon It's marketplace. 0:13:19.760 --> 0:13:22.079 Doreys a lot on your plate, We appreciate it, Leah. 0:13:23.400 --> 0:13:24.160 Now let's just talk. 0:13:24.000 --> 0:13:26.840 About another company, Meta now, But it is actually rolling out. 0:13:26.760 --> 0:13:29.160 New AI tools to help advertisers. 0:13:28.600 --> 0:13:32.040 Create and edit videos more easily, seeking to reach Facebook 0:13:32.080 --> 0:13:33.880 Instagram users who are spending. 0:13:33.559 --> 0:13:35.000 More time watching videos now. 0:13:35.080 --> 0:13:37.760 The new features, which will be available broadly next year, 0:13:38.040 --> 0:13:41.520 will let advertisers use generative AI to turn static images 0:13:41.520 --> 0:13:44.640 into video ads, and marketers will also be able to 0:13:44.760 --> 0:13:47.359 edit and adjust the size of the video ads automatically. 0:13:48.040 --> 0:13:51.120 Let's bring in Rachel Tibograph, who is a founder and 0:13:51.160 --> 0:13:54.439 CEO of mcmac e commerce marketing platform from multichannel Brands. 0:13:54.440 --> 0:13:57.040 So interesting all these generative AI tools we had, of 0:13:57.040 --> 0:14:01.280 course to CEO coming on of other key social media 0:14:01.360 --> 0:14:03.679 companies that have really been thinking about the ways in 0:14:03.720 --> 0:14:06.439 which they can use jenners to AI. That was Pinterest 0:14:06.520 --> 0:14:09.000 last week. We get Meta today, Rachel. What does it 0:14:09.040 --> 0:14:11.760 add to your marketers who want to spend time on 0:14:11.800 --> 0:14:12.400 these companies. 0:14:13.760 --> 0:14:17.280 Yeah, the announcement that Meta made around what they call 0:14:17.559 --> 0:14:22.560 metagen video is pretty big because the number one barrier 0:14:23.040 --> 0:14:28.239 to advertising is creative and the fastest growing ad platforms 0:14:28.280 --> 0:14:31.280 are ones that are centered around short form video. So 0:14:31.320 --> 0:14:33.880 the fact that they're now going to create solutions that 0:14:34.000 --> 0:14:38.680 democratize video creation, it should boon to them to get 0:14:38.720 --> 0:14:42.120 more AD dollars, not just from Big Fortune one thousand brands, 0:14:42.120 --> 0:14:45.720 but really all of the SMB businesses, and that's the 0:14:45.840 --> 0:14:48.600 long tail of advertising that's really going to propel mephis 0:14:48.680 --> 0:14:49.640 growth forward. 0:14:50.080 --> 0:14:54.320 But go into this visual that we see now impressions 0:14:54.400 --> 0:14:58.200 Commerce impressions, You'll say, basically, Meta is driving two thirds 0:14:58.200 --> 0:15:01.000 of social traffic or mike Max's already a winning formula. 0:15:01.040 --> 0:15:04.840 From your perspective, it absolutely is. But to put this 0:15:05.000 --> 0:15:09.560 slide into context, between twenty twenty three and twenty twenty four, 0:15:09.920 --> 0:15:13.440 we've seen a ten percent growth in brand traffic in Meta. 0:15:14.120 --> 0:15:18.120 We've seen one hundred and ninety percent growth in brand 0:15:18.160 --> 0:15:22.480 traffic in TikTok. So if Meta wants to continue to 0:15:22.560 --> 0:15:25.680 have this huge leap in front of platforms like TikTok 0:15:25.760 --> 0:15:28.440 and Google, it needs to continue to make investments in 0:15:28.480 --> 0:15:31.680 their platform. They cannot rest on their laurels. And that's 0:15:31.680 --> 0:15:34.880 why I'm personally very proud of Meta for recognizing that 0:15:34.920 --> 0:15:38.040 they need to make deep advancements in AI to continue 0:15:38.040 --> 0:15:40.359 to lower the barrier to entry for advertisers. 0:15:42.520 --> 0:15:44.160 Rach, I'd like to go back to Meta and that 0:15:44.280 --> 0:15:46.840 news for a minute, because you understand the importance of 0:15:46.880 --> 0:15:50.200 technology from the advertiser's perspective, right. The basics of it are, 0:15:50.520 --> 0:15:54.120 this new feature can turn a static image into a 0:15:54.240 --> 0:15:57.600 video ad simple. But I think metas startings get a 0:15:57.680 --> 0:16:01.560 lot of credit for the real world progress it's making 0:16:02.040 --> 0:16:05.080 in AI. Just your reaction to that basic idea and 0:16:05.120 --> 0:16:07.440 what you think it will do to move the path 0:16:07.480 --> 0:16:08.640 forward for advertisers. 0:16:09.960 --> 0:16:15.440 Yeah. Absolutely, So to put this into context, advertisers can 0:16:15.480 --> 0:16:19.920 spend somewhere between ten percent of their overall marketing investments. 0:16:19.920 --> 0:16:22.920 I'm creative, but that's just in the cost of creative, 0:16:23.120 --> 0:16:26.040 the amount of hours that go into creating a video, 0:16:26.240 --> 0:16:29.400 approving a video, up and down the total pole. That's 0:16:29.440 --> 0:16:33.400 several people's jobs within an organization. So a simple solution 0:16:33.600 --> 0:16:36.880 like this might seem obvious and small, but it actually 0:16:36.920 --> 0:16:40.280 can change marketing and advertising as we know it. It 0:16:40.440 --> 0:16:43.320 also could create a rippling effect in terms of headcount. 0:16:43.960 --> 0:16:47.160 You might need fewer marketers with tools like this, So 0:16:47.200 --> 0:16:50.200 it's a really big deal in the advertising industry. The 0:16:50.240 --> 0:16:53.400 flip side is from Fortune one thousand brands. When it 0:16:53.400 --> 0:16:57.040 comes to AI and creative, they do have two major concerns. 0:16:57.560 --> 0:17:01.880 Number one is copyright violation and number two is data privacy. 0:17:02.320 --> 0:17:04.800 So there is a difference when you talk to a 0:17:04.840 --> 0:17:07.639 marketer that's running a business that's doing fifty million dollars 0:17:07.800 --> 0:17:10.280 revenue versus when you talk to a marketer that's running 0:17:10.320 --> 0:17:13.600 a business doing a billion dollars in revenue. So Meta 0:17:13.680 --> 0:17:15.119 is going to have some work to do with the 0:17:15.280 --> 0:17:22.199 major advertisers to us sage concerns around copyright and data privacy. 0:17:23.160 --> 0:17:24.520 I think we're going to move on a little bit 0:17:24.600 --> 0:17:28.119 to Amazon. It's Prime Day. I know that at home 0:17:28.400 --> 0:17:29.919 Prime Day is going to be big, So I've got 0:17:29.920 --> 0:17:32.360 a few things, so I've got to get for other people. 0:17:32.720 --> 0:17:36.800 Let's be honest, it's completely inane. Why is Amazon Prime 0:17:36.880 --> 0:17:40.520 Day window important for you in your platform? 0:17:40.920 --> 0:17:41.160 Yeah? 0:17:41.200 --> 0:17:45.320 Absolutely so. Amazon Prime Day has now become a ten 0:17:45.400 --> 0:17:48.800 pole mode moment, not just within the US but globally. 0:17:49.320 --> 0:17:51.960 It's a day to really move a lot of excess 0:17:52.000 --> 0:17:56.320 supply and bring value to consumers. In twenty twenty four, 0:17:56.400 --> 0:17:59.840 this is really important on any given day. At MCKMAC 0:18:00.080 --> 0:18:04.440 this year, we've seen a twenty percent decline in basket sizes. 0:18:04.840 --> 0:18:07.840 You've now seen this play out in public earnings of 0:18:07.920 --> 0:18:12.520 mass consumer product companies. Volume sales are down. Why Because 0:18:12.520 --> 0:18:16.240 the last few years major mass consumer product companies have 0:18:16.359 --> 0:18:19.560 taken price hikes and now consumers are fighting back with 0:18:19.600 --> 0:18:23.200 their wallets. What Amazon Prime Day is going to show 0:18:23.280 --> 0:18:27.400 us today and tomorrow is how willing are consumers going 0:18:27.440 --> 0:18:31.320 to spend during this year's holiday season. There's been inflation, 0:18:31.640 --> 0:18:34.199 there's been price hikes, but on the other side of 0:18:34.200 --> 0:18:38.200 the equation, the FED dropping interest rates and hopefully doing 0:18:38.240 --> 0:18:42.439 that again in November and December brings optimism to consumers. 0:18:43.800 --> 0:18:46.640 Rachel Tivograph, founder and CEO of matt covering all of it, 0:18:46.720 --> 0:18:47.600 thank you so much. 0:18:54.440 --> 0:18:56.840 The US is in the early stages of an investigation 0:18:56.920 --> 0:19:00.600 into potential Chinese hacking of American telecom companies. It's according 0:19:00.600 --> 0:19:04.240 to a top intelligence official. Investigators say a hackers may 0:19:04.320 --> 0:19:07.000 have accessed court authorized why tapping information. 0:19:07.200 --> 0:19:08.199 I want to discuss all of this. 0:19:08.320 --> 0:19:11.399 The president of Wandross and former CASA Chief of Staff 0:19:11.480 --> 0:19:14.240 kissed and Todd. So how do we know that it 0:19:14.320 --> 0:19:15.560 might be Chinese hackers? 0:19:17.080 --> 0:19:19.520 Well, we're still learning about this effort. But what we're 0:19:19.520 --> 0:19:23.080 hearing right now is that this malicious actor we're calling 0:19:23.200 --> 0:19:27.119 salt Typhoon, which is part of a People's Republic of 0:19:27.200 --> 0:19:31.800 China PRC state sponsored cyber campaign. This one in particular, 0:19:31.880 --> 0:19:35.200 we believe to have hacked into internet service providers a 0:19:35.240 --> 0:19:38.199 little over a month ago, and we're researching now if 0:19:38.240 --> 0:19:41.720 it in fact has hacked into communications companies. We do 0:19:41.840 --> 0:19:43.960 believe this is part of this broader campaign. We saw 0:19:44.080 --> 0:19:48.000 volt Typhoon earlier this year, which attacked our IT networks, 0:19:48.040 --> 0:19:50.960 and we've seen flax Typhoon, which is a cyber espionage 0:19:50.960 --> 0:19:55.200 effort by the People's Republic of China against thaiwik organizations. 0:19:55.840 --> 0:20:01.080 Kirstin, the focus is infrastructure telecoms, but war to infrastructure. 0:20:01.560 --> 0:20:03.120 Your expert analysis on. 0:20:03.119 --> 0:20:07.680 That, it's all infrastructure. When we look at intelligence over 0:20:07.720 --> 0:20:11.040 the last two years. Last year, our annual Threat Assessment 0:20:11.080 --> 0:20:14.520 from the United States Intelligence Community said that China would 0:20:14.560 --> 0:20:18.440 be seeking to pre position itself on all infrastructure, so 0:20:18.480 --> 0:20:22.000 that if we believe in china strategic objective to go 0:20:22.040 --> 0:20:25.600 after Taiwan, it would have the ability to disrupt and 0:20:25.640 --> 0:20:29.280 in some cases destroy our infrastructure to minimize our ability 0:20:29.359 --> 0:20:32.480 to act as an adversary against China against Taiwan. 0:20:33.320 --> 0:20:37.239 So the response the safety is there enough coming from 0:20:37.280 --> 0:20:38.080 the United States. 0:20:38.960 --> 0:20:41.320 We absolutely have to be doing more. If I'm a 0:20:41.359 --> 0:20:44.240 CEO or a board member of a company, I am 0:20:44.480 --> 0:20:48.560 ensuring that I am elevating my security, my safety, I 0:20:48.600 --> 0:20:51.360 have to assume that China is on my network. This 0:20:51.400 --> 0:20:55.159 isn't about fear. It's about strategy and being smart and 0:20:55.240 --> 0:20:59.479 preparing for a more secure and resilient infrastructure. We have 0:20:59.560 --> 0:21:02.760 to elevate our game. This shouldn't be news to any company. 0:21:02.760 --> 0:21:06.360 It shouldn't be news to any board member. Cyberboard governance, 0:21:06.440 --> 0:21:08.640 the ability to bring this into the boardroom has never 0:21:08.720 --> 0:21:12.800 been more critical. All companies, particularly critical infrastructure companies, should 0:21:12.840 --> 0:21:16.719 be testing business continuity plans, should be testing different scenarios 0:21:16.760 --> 0:21:19.480 to ensure that they are safe and secure in light 0:21:19.600 --> 0:21:21.320 of this increasing threat. 0:21:22.080 --> 0:21:25.080 Kissed and to President of Wondrous and former sis A 0:21:25.240 --> 0:21:26.720 chief of staff, thank you so much. 0:21:26.960 --> 0:21:39.880 This Thursday, Blue. 0:21:35.560 --> 0:21:36.920 Welcome back to Bluebog Technology. 0:21:36.960 --> 0:21:39.320 I'm Caroline Hid in New York and I'm Ed Ludlow 0:21:39.320 --> 0:21:40.080