1
00:00:03,600 --> 00:00:07,720
Speaker 1: This is Bloomberg surveillance. No matter what happened, the US dollar,

2
00:00:07,840 --> 00:00:10,200
Speaker 1: will you need to strengthen, whether the Fed hikes in

3
00:00:10,320 --> 00:00:13,640
Speaker 1: June or week before December. The US economy is in

4
00:00:13,960 --> 00:00:15,880
Speaker 1: very good shape right now, have better shape than it

5
00:00:15,960 --> 00:00:18,760
Speaker 1: has been from US a decade. We're washing around marking

6
00:00:18,840 --> 00:00:21,000
Speaker 1: time before the next leg higher and the US dollar.

7
00:00:21,160 --> 00:00:23,400
Speaker 1: I'm just not completely comfortable in my mind with whether

8
00:00:23,440 --> 00:00:25,880
Speaker 1: it's led by this risk aversion or its red tip

9
00:00:26,160 --> 00:00:30,440
Speaker 1: Bloomberg surveillance your link to the world of economics, finance,

10
00:00:30,480 --> 00:00:34,200
Speaker 1: and investment on Bloomberg Radio. Good morning everyone, Michael McKee

11
00:00:34,200 --> 00:00:38,600
Speaker 1: and Time Keen worldwide Bloomberg Surveillance coast to coast Bloomberg Surveillance,

12
00:00:39,320 --> 00:00:44,519
Speaker 1: Good morning Boston, Bloomberg tw FM, Washington, Baltimore, eleven three

13
00:00:44,560 --> 00:00:46,839
Speaker 1: oh in New York and San Francisco. Just waking up

14
00:00:47,000 --> 00:00:50,960
Speaker 1: in Coopertin. Always say good morning s the Bay Area

15
00:00:50,960 --> 00:00:53,239
Speaker 1: and I'll of you on serious and next time. Why

16
00:00:53,280 --> 00:00:56,160
Speaker 1: do I go through all of our distribution, because we

17
00:00:56,240 --> 00:01:01,400
Speaker 1: have for the entire hour on your world of media,

18
00:01:01,600 --> 00:01:06,000
Speaker 1: whether your daughters are doing musically, whether you're doing minecraft

19
00:01:06,280 --> 00:01:10,240
Speaker 1: or Apple, how many Apple things are in your house?

20
00:01:10,720 --> 00:01:14,240
Speaker 1: From bt i G for the entire hour Walter Pisk,

21
00:01:14,280 --> 00:01:17,560
Speaker 1: and he's brought along Rich Greenfield as well. We're gonna talk,

22
00:01:18,120 --> 00:01:22,520
Speaker 1: We're gonna play Minecraft here and it's all digital all

23
00:01:22,560 --> 00:01:25,039
Speaker 1: the time. We're gonna help you with the sanity of

24
00:01:25,120 --> 00:01:28,280
Speaker 1: your insane digital space. We will do that here in

25
00:01:28,280 --> 00:01:32,600
Speaker 1: a moment. Bloomberg Surveillance this morning, brought you by Cone Resnick.

26
00:01:32,959 --> 00:01:36,800
Speaker 1: Look at Gain, Insight, imagine more, get forward thinking advice.

27
00:01:36,800 --> 00:01:41,200
Speaker 1: It can help turn business possibilities into business opportunities. Find

28
00:01:41,200 --> 00:01:45,759
Speaker 1: out more cons dot Com, bt i G. It's Rich

29
00:01:45,800 --> 00:01:49,680
Speaker 1: Greenfield Walter Pisk helping out on media. Rich, I want

30
00:01:49,680 --> 00:01:54,200
Speaker 1: to frame why this is important. You years ago created

31
00:01:54,280 --> 00:01:59,200
Speaker 1: securities analysis history. Everybody just took the c F exam

32
00:01:59,240 --> 00:02:02,160
Speaker 1: by literally all almost getting arrested off of an initial

33
00:02:02,200 --> 00:02:06,080
Speaker 1: public offer. He was dead serious, serious stuff. We'll leave

34
00:02:06,120 --> 00:02:09,040
Speaker 1: the name of the company out of it. Since then

35
00:02:09,080 --> 00:02:11,119
Speaker 1: you went from Goldman Sex and you were doing your

36
00:02:11,120 --> 00:02:13,519
Speaker 1: thing and you almost ended up in jail and yelling

37
00:02:13,560 --> 00:02:18,560
Speaker 1: and screaming and all that. The media business has totally changed.

38
00:02:18,639 --> 00:02:22,520
Speaker 1: Did you have any inkling back when you were almost

39
00:02:22,520 --> 00:02:26,400
Speaker 1: getting invested seven eight, nine years ago, how this whole

40
00:02:26,639 --> 00:02:31,000
Speaker 1: digital media thing would explode. Did you see it coming?

41
00:02:32,000 --> 00:02:34,079
Speaker 1: I mean, like we lived through music, so I think

42
00:02:34,080 --> 00:02:36,480
Speaker 1: when you know, having gone through the music at industry

43
00:02:36,480 --> 00:02:40,200
Speaker 1: and seeing how um piracy in the digital transition was

44
00:02:40,280 --> 00:02:42,480
Speaker 1: so hard. I mean you think about music and how

45
00:02:42,520 --> 00:02:45,800
Speaker 1: hard it fell, how many companies have been hurt, how

46
00:02:45,880 --> 00:02:50,320
Speaker 1: many executives have been downsized throughout the music labels. I

47
00:02:50,360 --> 00:02:53,239
Speaker 1: think music was a great learning experience for what TV

48
00:02:53,800 --> 00:02:56,720
Speaker 1: was gonna come, more video video, more generally. And it's

49
00:02:56,760 --> 00:02:59,800
Speaker 1: what's crazy is they saw it coming, they knew digital

50
00:02:59,880 --> 00:03:03,960
Speaker 1: was coming, and they still weren't prepared. I'll go with that.

51
00:03:04,080 --> 00:03:06,000
Speaker 1: I want to get right to the emotion of the moment.

52
00:03:06,000 --> 00:03:08,200
Speaker 1: I know Mike's got a million questions that Walter's here

53
00:03:08,240 --> 00:03:11,079
Speaker 1: on Apple and and and that in Mary Meeker's two

54
00:03:11,760 --> 00:03:13,799
Speaker 1: two slides, whatever it is that she just put out.

55
00:03:14,080 --> 00:03:18,040
Speaker 1: The single slide is on a blocking It's here, it's real.

56
00:03:18,360 --> 00:03:23,160
Speaker 1: How does your world respond to people in full disclosure, folks,

57
00:03:23,200 --> 00:03:27,160
Speaker 1: I use it saying I'm not gonna look at as well. Look,

58
00:03:27,200 --> 00:03:30,200
Speaker 1: I think that's exactly why on mobile there's only a

59
00:03:30,200 --> 00:03:33,120
Speaker 1: few companies that are really winning. And it's the big platforms.

60
00:03:33,120 --> 00:03:37,280
Speaker 1: It's the facebooks. It's the snapchats. The platforms are really

61
00:03:37,360 --> 00:03:41,400
Speaker 1: going to win, and all of the distributed web is

62
00:03:41,400 --> 00:03:44,280
Speaker 1: a very hard place because you've got this whole free

63
00:03:44,280 --> 00:03:47,160
Speaker 1: web supported by advertising, and as you said, Tom, more

64
00:03:47,200 --> 00:03:49,800
Speaker 1: and more people aren't looking at advertising. It's really the

65
00:03:49,840 --> 00:03:52,440
Speaker 1: same problem we have in linear TV is people don't

66
00:03:52,440 --> 00:03:54,040
Speaker 1: want to have their time wasted. They don't want to

67
00:03:54,080 --> 00:03:57,840
Speaker 1: be disrupted, and so they're doing things to make basically

68
00:03:57,880 --> 00:04:01,400
Speaker 1: make better use of their time and experience. And Mike Walter,

69
00:04:01,560 --> 00:04:03,960
Speaker 1: to your point on Apple TV. I watch Apple TV,

70
00:04:04,040 --> 00:04:08,360
Speaker 1: so I watch few reds, Mike, even when it's absolutely

71
00:04:08,560 --> 00:04:12,440
Speaker 1: I mean, it's fascinating. Thing. Wal They're my kids at

72
00:04:12,520 --> 00:04:16,920
Speaker 1: Christmas time never ask for anything except the stuff they've

73
00:04:16,960 --> 00:04:19,200
Speaker 1: already got, you know, more legos or stuff like that.

74
00:04:19,560 --> 00:04:21,760
Speaker 1: And I've decided it is because we watch Apple TV.

75
00:04:21,800 --> 00:04:24,840
Speaker 1: They don't see commercials, they don't see what the new

76
00:04:24,880 --> 00:04:28,159
Speaker 1: hot toy is. And other parents have told me the

77
00:04:28,200 --> 00:04:31,159
Speaker 1: same thing. Although I just want to drone and all

78
00:04:31,200 --> 00:04:34,120
Speaker 1: of my kids, even though that they don't aren't getting advertised.

79
00:04:34,120 --> 00:04:36,720
Speaker 1: The Drone knew everything about it because the advertisements end

80
00:04:36,760 --> 00:04:39,920
Speaker 1: up being these YouTube clips that they keep watching and

81
00:04:39,960 --> 00:04:42,440
Speaker 1: they have kids that are basically demoing these products that

82
00:04:42,640 --> 00:04:44,560
Speaker 1: the kids are probably getting paid. So it's actually a

83
00:04:44,600 --> 00:04:48,800
Speaker 1: new form of commercialization that they're reaching. At least my

84
00:04:48,920 --> 00:04:52,840
Speaker 1: kids who actually have a Minecraft on one window a

85
00:04:52,960 --> 00:04:55,760
Speaker 1: YouTube and the other they're watching someone play Minecraft while

86
00:04:55,760 --> 00:04:59,320
Speaker 1: they're playing mine. That they sit and they watch other

87
00:04:59,360 --> 00:05:03,320
Speaker 1: people play the silly games. You know, it's it's amazing.

88
00:05:03,480 --> 00:05:06,760
Speaker 1: Let me go back to, uh, to something that rich

89
00:05:07,279 --> 00:05:10,599
Speaker 1: was talking about when when when you said that, Um,

90
00:05:10,720 --> 00:05:13,559
Speaker 1: the challenge is getting people who don't want to waste

91
00:05:13,560 --> 00:05:17,680
Speaker 1: their time two put up with ads because the internet

92
00:05:17,720 --> 00:05:20,720
Speaker 1: is free. If that's the case, how come the good

93
00:05:20,720 --> 00:05:22,440
Speaker 1: folks at the Wall Street Journal are like the only

94
00:05:22,520 --> 00:05:24,599
Speaker 1: people out there who've been able to make a subscription

95
00:05:24,680 --> 00:05:28,479
Speaker 1: model work. You can't people convince folks that if you

96
00:05:28,640 --> 00:05:31,400
Speaker 1: if you give us a few dollars, then you never

97
00:05:31,520 --> 00:05:33,800
Speaker 1: have to see ads. Well, when I step back, I

98
00:05:33,839 --> 00:05:35,839
Speaker 1: do think there's there's one other element to what you

99
00:05:35,880 --> 00:05:38,080
Speaker 1: just said that's important. It's not just about having your

100
00:05:38,080 --> 00:05:41,600
Speaker 1: time wasted, um, in terms of uh, the ad itself.

101
00:05:41,680 --> 00:05:44,520
Speaker 1: Part of it's also the experience. So you know, when

102
00:05:44,520 --> 00:05:47,080
Speaker 1: you load up a website and there's thirty seven different

103
00:05:47,120 --> 00:05:50,880
Speaker 1: ads loading in the background. The lag time it's actually

104
00:05:50,920 --> 00:05:52,640
Speaker 1: really annoying. And so there's a lot of people who

105
00:05:52,680 --> 00:05:56,960
Speaker 1: like the speed and efficiency of removing the ads um

106
00:05:57,080 --> 00:05:59,320
Speaker 1: not just the blocking of the content on the page itself,

107
00:05:59,320 --> 00:06:01,479
Speaker 1: but it's actually the speed time I think is a

108
00:06:01,520 --> 00:06:04,520
Speaker 1: real factor. But you know, I think the Wall Street Journal. Look,

109
00:06:04,560 --> 00:06:06,920
Speaker 1: you've got a unique case, right, I mean, this is

110
00:06:06,960 --> 00:06:10,760
Speaker 1: something for Wall Street becomes like critical reading. I think

111
00:06:10,800 --> 00:06:13,600
Speaker 1: everyone else the problem is what is unique. I mean,

112
00:06:13,760 --> 00:06:16,200
Speaker 1: look at Snapchat. You can turn on Snapchat, you can

113
00:06:16,240 --> 00:06:20,760
Speaker 1: download it for free, you can literally access it for free,

114
00:06:21,200 --> 00:06:24,359
Speaker 1: and you can get CNN content, you can get the

115
00:06:24,400 --> 00:06:27,400
Speaker 1: Plays of the day from basically from ESPN. You can

116
00:06:27,440 --> 00:06:30,000
Speaker 1: get actually a bunch of Wall Street Journal content. The

117
00:06:30,040 --> 00:06:32,880
Speaker 1: problem is the platforms are becoming so powerful that it's

118
00:06:32,920 --> 00:06:35,119
Speaker 1: becoming harder and harder, and so the Wall Street Journal

119
00:06:35,120 --> 00:06:37,760
Speaker 1: may fit a very specific niche, but for everyone else,

120
00:06:37,800 --> 00:06:41,919
Speaker 1: there's so many sources of free, easily available content that

121
00:06:42,040 --> 00:06:44,560
Speaker 1: all the content makers that used to sell subscriptions to

122
00:06:44,600 --> 00:06:47,200
Speaker 1: get to are now providing their content for free to

123
00:06:47,800 --> 00:06:51,200
Speaker 1: It's really a real problem for publishers. A million quite

124
00:06:51,200 --> 00:06:53,800
Speaker 1: a ways to follow this up, but just uh, when

125
00:06:53,960 --> 00:06:58,360
Speaker 1: when you talk about um, the idea that you can

126
00:06:58,360 --> 00:07:01,120
Speaker 1: get all this stuff on on the plat form so

127
00:07:01,200 --> 00:07:03,839
Speaker 1: many we hear from so many different companies these days.

128
00:07:03,839 --> 00:07:07,599
Speaker 1: We're going into digital because that content is where the

129
00:07:07,600 --> 00:07:10,480
Speaker 1: future is. They can't, I mean, they can't make money,

130
00:07:10,520 --> 00:07:13,000
Speaker 1: can they over the long run unless they have a

131
00:07:13,040 --> 00:07:16,239
Speaker 1: Wall Street Journal kind of exclusivity? Because let's say Cosmos,

132
00:07:16,280 --> 00:07:19,480
Speaker 1: So Cosmo used it sells magazines, right and now Cosmo

133
00:07:19,560 --> 00:07:23,240
Speaker 1: puts its content onto Snapchat Discover? Is that a smart move?

134
00:07:23,480 --> 00:07:25,640
Speaker 1: They get their brand awareness? My daughter, now, I think

135
00:07:25,680 --> 00:07:27,920
Speaker 1: who's their team knows what Cosmo is because it's on

136
00:07:27,920 --> 00:07:32,440
Speaker 1: Snapchat Discover. But but is she more likely to buy

137
00:07:32,480 --> 00:07:36,600
Speaker 1: Cosmo magazine or sign up for a Cosmo subscription? God,

138
00:07:36,680 --> 00:07:38,360
Speaker 1: I just I find it very hard to believe that

139
00:07:38,400 --> 00:07:40,440
Speaker 1: she's going to sign up for a Cosmo subscription. I

140
00:07:40,480 --> 00:07:44,760
Speaker 1: think she likes getting Cosmo for free on Snapchat. Rich Greenfield,

141
00:07:44,920 --> 00:07:47,600
Speaker 1: this is wonderful, folks, for the entire Rich Greenfield, quickly,

142
00:07:47,640 --> 00:07:51,240
Speaker 1: what's your single best buy right now? We love Netflix.

143
00:07:51,280 --> 00:07:54,000
Speaker 1: We think Netflix is a single most undervalued stock in

144
00:07:54,000 --> 00:07:56,640
Speaker 1: the group. I'm gonna go back Walter to go a

145
00:07:56,720 --> 00:07:59,040
Speaker 1: little more in depth. Here than just quickly on Netflix

146
00:07:59,040 --> 00:08:01,800
Speaker 1: and will come back to this, justify where you are

147
00:08:01,840 --> 00:08:05,160
Speaker 1: now an Apple given all the uncertainty it says, it's

148
00:08:05,240 --> 00:08:07,720
Speaker 1: definitely one of those things where you have to defend

149
00:08:07,720 --> 00:08:10,800
Speaker 1: yourself with with a byrating for Apple these days, Um,

150
00:08:11,000 --> 00:08:14,360
Speaker 1: it is our belief that they will return to growth

151
00:08:14,400 --> 00:08:17,080
Speaker 1: in this December quarter. There it's a no growth year.

152
00:08:17,280 --> 00:08:20,440
Speaker 1: If they go into a second no growth year, which

153
00:08:20,520 --> 00:08:23,920
Speaker 1: starts in this December quarter, it's gonna be hard for anyone.

154
00:08:24,000 --> 00:08:26,760
Speaker 1: Golden Sex battle zero to three percent revenue growth? Do

155
00:08:26,760 --> 00:08:28,960
Speaker 1: you agree any type of revenue? We agree for the

156
00:08:28,960 --> 00:08:30,840
Speaker 1: December quarter and then next year you're talking about a

157
00:08:30,840 --> 00:08:33,040
Speaker 1: low single digit growth company. Look, when when they launched

158
00:08:33,040 --> 00:08:36,040
Speaker 1: the six this was a very unique scenario. There was

159
00:08:36,080 --> 00:08:38,000
Speaker 1: a lot of pent up demand for these large products.

160
00:08:38,000 --> 00:08:41,320
Speaker 1: How do they change use to kesh deployment? Given low

161
00:08:41,400 --> 00:08:43,800
Speaker 1: single digit growth, There's been a lot of pressure for

162
00:08:43,840 --> 00:08:47,120
Speaker 1: acquisitions to find new spaces. But look, they're they're trying

163
00:08:47,120 --> 00:08:49,240
Speaker 1: to do this with increased R and D by developing

164
00:08:49,240 --> 00:08:52,240
Speaker 1: the products internally. So if they're not buying companies to

165
00:08:52,280 --> 00:08:54,320
Speaker 1: get into new categories, they should give it back to

166
00:08:54,320 --> 00:08:56,280
Speaker 1: share olders. The three of you. Anybody got an idea

167
00:08:56,280 --> 00:08:59,640
Speaker 1: on Twitter? Michaol will take out Twitter. I don't have

168
00:08:59,720 --> 00:09:05,480
Speaker 1: an eye. Look, Twitter is a great newsreader. It's a

169
00:09:05,520 --> 00:09:07,520
Speaker 1: great way to find out what's going on in the world.

170
00:09:08,080 --> 00:09:11,080
Speaker 1: But most people are not active. It's not social. You know.

171
00:09:11,160 --> 00:09:14,000
Speaker 1: The reason why people must explain why I'm on it,

172
00:09:16,480 --> 00:09:21,360
Speaker 1: Walter Apple by Twitter, Um, I think that time has past.

173
00:09:21,520 --> 00:09:24,000
Speaker 1: I'm not sure that the eyeballs that they're getting he gave.

174
00:09:24,080 --> 00:09:25,959
Speaker 1: There's much more important things for Apple to take a

175
00:09:25,960 --> 00:09:30,320
Speaker 1: look at Twitter distract. Well, I'm trying. I'm trying to

176
00:09:30,320 --> 00:09:33,040
Speaker 1: retweet you. So I'm just trying to give you some

177
00:09:33,080 --> 00:09:35,440
Speaker 1: more social following. You know, I get in trouble for

178
00:09:35,520 --> 00:09:39,839
Speaker 1: not tweeting enough. You know, our executive producer Rachel With

179
00:09:40,000 --> 00:09:42,240
Speaker 1: everybody says, tweet out the content of the show. How

180
00:09:42,240 --> 00:09:44,240
Speaker 1: do I do that? Well, I'm making a show. This

181
00:09:44,320 --> 00:09:47,360
Speaker 1: is Twitter just put another or it just lost another

182
00:09:47,400 --> 00:09:50,160
Speaker 1: head of product. I mean, this is a company. Every

183
00:09:50,160 --> 00:09:52,280
Speaker 1: single year they lose their head of product. I mean

184
00:09:52,280 --> 00:09:54,720
Speaker 1: they can't keep somebody. The problem is they don't know

185
00:09:54,760 --> 00:09:57,080
Speaker 1: what the products supposed to be. Walt and I and

186
00:09:57,120 --> 00:09:59,280
Speaker 1: maybe you, we love the product the way it is

187
00:09:59,320 --> 00:10:02,240
Speaker 1: and it's really useful as a utility for us, but

188
00:10:02,320 --> 00:10:06,440
Speaker 1: for the average person, Twitter is totally totally confusing, and

189
00:10:06,480 --> 00:10:08,640
Speaker 1: if you didn't use Twitter, you're no worse off than

190
00:10:08,679 --> 00:10:10,760
Speaker 1: you were the day before. Here's who we're doing, folks.

191
00:10:10,800 --> 00:10:12,760
Speaker 1: Mike and I have been doing this for decades, and

192
00:10:12,800 --> 00:10:16,440
Speaker 1: we discovered a year ago with some testing that if

193
00:10:16,480 --> 00:10:18,800
Speaker 1: you get to really smart people in a room for

194
00:10:18,840 --> 00:10:22,800
Speaker 1: an hour, good things happen. We've been doing that more

195
00:10:22,840 --> 00:10:25,720
Speaker 1: and more, and we do it this hour. Walter Pissek

196
00:10:25,840 --> 00:10:29,360
Speaker 1: with us and Richard Greenfield there with bt I G

197
00:10:29,960 --> 00:10:32,679
Speaker 1: and they call it Media and Cable Systems. I don't

198
00:10:32,720 --> 00:10:34,880
Speaker 1: know what that means, but anyways, they are here to

199
00:10:34,920 --> 00:10:38,240
Speaker 1: talk to us about our digital disruption, which Mike is

200
00:10:38,280 --> 00:10:43,400
Speaker 1: appropriate considering. John Tucker uses the original cell phone from

201
00:10:43,440 --> 00:10:46,720
Speaker 1: one of those, uh those those movies from years ago.

202
00:10:46,880 --> 00:10:52,800
Speaker 1: Features up five, doubt, features up forty six. All right,

203
00:10:52,840 --> 00:10:55,800
Speaker 1: let's check in now with Michael John Tucker get the

204
00:10:55,880 --> 00:10:59,600
Speaker 1: latest world in national headlines only weighs ten pounds. Hilary

205
00:10:59,640 --> 00:11:02,840
Speaker 1: Clinton hoping for victory of today's primaries in California, New

206
00:11:02,920 --> 00:11:06,480
Speaker 1: Jersey and contests and four other states. Bundt ap count

207
00:11:06,559 --> 00:11:08,880
Speaker 1: shows she already has reached the number of delegates needed

208
00:11:08,880 --> 00:11:13,160
Speaker 1: for the Democratic nomination. Democratic rival Bernie Center says tomorrow

209
00:11:13,400 --> 00:11:17,160
Speaker 1: he's returning to Vermont to, in his words, assess where

210
00:11:17,160 --> 00:11:19,840
Speaker 1: we are. Speaker Paul Ryan said to unveil the first

211
00:11:19,840 --> 00:11:22,960
Speaker 1: plank of the House Republican Legislative Plan. It seemed at

212
00:11:23,040 --> 00:11:25,880
Speaker 1: carving out an agenda for a party who's presumptive presidential

213
00:11:25,920 --> 00:11:30,080
Speaker 1: nominee hasn't offered many detailed policy positions. At least eleven

214
00:11:30,080 --> 00:11:32,760
Speaker 1: are dead, another thirty six wounded after Russia hour car

215
00:11:32,800 --> 00:11:36,359
Speaker 1: bombing targeting a bus carrying riot police went off in Istanbul,

216
00:11:36,800 --> 00:11:40,680
Speaker 1: and forecasters say tropical storm college moving rapidly toward the

217
00:11:40,679 --> 00:11:44,000
Speaker 1: northeast as it continues drop heavy rains over the south.

218
00:11:44,520 --> 00:11:47,360
Speaker 1: The storm moved across Florida yesterday, knocking out power and

219
00:11:47,400 --> 00:11:51,000
Speaker 1: flooding roads. Global News twenty four hours a day, powered

220
00:11:51,000 --> 00:11:52,840
Speaker 1: by a twenty four hundred journalists in more than one

221
00:11:52,920 --> 00:11:55,680
Speaker 1: hundred fifty news bureaus around the world. I'm John Tucker,

222
00:11:55,840 --> 00:11:58,760
Speaker 1: Tom Mike, Thanks so much, Rich green Field, Water Piece

223
00:11:58,760 --> 00:12:07,000
Speaker 1: econ Apple on Net, Next, Bloomberg Surveillance. The news Update

224
00:12:07,040 --> 00:12:09,160
Speaker 1: brought to you by Landrover Precipitate. If it's in your

225
00:12:09,240 --> 00:12:11,080
Speaker 1: nature to cast off the every day and seek adventure

226
00:12:11,080 --> 00:12:13,000
Speaker 1: of the discovery sport was built to help your search.

227
00:12:13,080 --> 00:12:16,599
Speaker 1: Visit Landrover Percipity dot com or one fine f w

228
00:12:16,679 --> 00:12:24,360
Speaker 1: d Landrover above and beyond Global business news twenty four

229
00:12:24,360 --> 00:12:27,480
Speaker 1: hours a day, if Bloomberg dot com, the Radio plus

230
00:12:27,520 --> 00:12:30,680
Speaker 1: mobile app and on your radio. This is a Bloomberg

231
00:12:30,760 --> 00:12:34,360
Speaker 1: Business Flash and I'm Karen Moscow. Futures are higher this morning.

232
00:12:34,440 --> 00:12:36,240
Speaker 1: Let's go to the First Word Breaking news desk for

233
00:12:36,280 --> 00:12:39,480
Speaker 1: today's morning call, and here's Bill Maloney. Good morning though,

234
00:12:39,720 --> 00:12:42,840
Speaker 1: good morning, Karen. That's right. US stock futures remain higher,

235
00:12:43,040 --> 00:12:45,880
Speaker 1: with doubtfures currently hired by forty five points SIME s

236
00:12:45,880 --> 00:12:48,360
Speaker 1: game four and as a futures rise by eight and

237
00:12:48,360 --> 00:12:51,240
Speaker 1: a half. US ten yield at one point seven two

238
00:12:51,360 --> 00:12:54,679
Speaker 1: percent and up of markets are also climbing. Italy is

239
00:12:54,760 --> 00:12:58,360
Speaker 1: up one percent on the US Economic Frinday thirty non

240
00:12:58,400 --> 00:13:02,040
Speaker 1: farm productivity and at three p m consumer credit. After

241
00:13:02,080 --> 00:13:05,200
Speaker 1: Dobelli's and Alexey Young drug trial failed to meet primary goal,

242
00:13:05,520 --> 00:13:08,080
Speaker 1: swrept to ask for more data from the FDA before

243
00:13:08,160 --> 00:13:11,160
Speaker 1: ruling shares her up twenty nine percent pre market, and

244
00:13:11,160 --> 00:13:14,640
Speaker 1: You're Not in Natural Foods boosted its forecast this morning,

245
00:13:14,720 --> 00:13:18,200
Speaker 1: Valiant cut its forecast, shares it down fifteen percent pre market.

246
00:13:18,600 --> 00:13:22,079
Speaker 1: HD supply was mixed, and Ralph Florence's year net revenue

247
00:13:22,520 --> 00:13:26,400
Speaker 1: down low double digits. Shares drop seven percent pre market.

248
00:13:26,640 --> 00:13:29,600
Speaker 1: And other news. Biogen drops nine percent pre market after

249
00:13:29,679 --> 00:13:33,160
Speaker 1: it's MS drug misstudy endpoint and a deal news zoom

250
00:13:33,160 --> 00:13:36,199
Speaker 1: Obioma to buy LDR Holding for thirty seven dollars a

251
00:13:36,280 --> 00:13:39,920
Speaker 1: share in cash. Finally, some of your wallsheet upgrades and downgrades.

252
00:13:40,160 --> 00:13:43,360
Speaker 1: Amazon price start at raised to nine thirty from seven eighty.

253
00:13:43,360 --> 00:13:46,080
Speaker 1: Overt Oppenheimer Go Daddy cuts to neutral at City Group,

254
00:13:46,360 --> 00:13:49,079
Speaker 1: Zillo raised to equ way to Barkley's Jable cut to

255
00:13:49,120 --> 00:13:52,120
Speaker 1: sell a Coalman Sachs and Western Digital raised too by

256
00:13:52,559 --> 00:13:55,120
Speaker 1: over at miszoo ho live from the first breaking news

257
00:13:55,120 --> 00:13:58,000
Speaker 1: desk on Boo Maloney Karen alright, thanks sabailan to hear

258
00:13:58,040 --> 00:14:00,640
Speaker 1: lie breaking news over here, Bloomberg type squawk and go

259
00:14:00,800 --> 00:14:03,160
Speaker 1: on your terminal. Let's ask you a w k go.

260
00:14:03,400 --> 00:14:06,360
Speaker 1: That's a Bloomberg business flash, Tom and Mike Karen, thanks

261
00:14:06,360 --> 00:14:09,559
Speaker 1: so much, Bloomberg surveillance this morning. What you're buy investco?

262
00:14:09,920 --> 00:14:15,079
Speaker 1: Looking for investment views, Investco's high conviction portfolio managers are

263
00:14:15,120 --> 00:14:18,160
Speaker 1: just to click away. Go to investco dot com, slash

264
00:14:18,760 --> 00:14:22,160
Speaker 1: us to subscribe to the investco blog and follow at

265
00:14:22,240 --> 00:14:25,440
Speaker 1: investo us on Twitter. You were lucky, folks. You're in

266
00:14:25,480 --> 00:14:28,520
Speaker 1: commercial break. What a battle in our studios over what

267
00:14:28,520 --> 00:14:31,040
Speaker 1: we're gonna talk about for the next forty five minutes.

268
00:14:31,240 --> 00:14:36,480
Speaker 1: Michael McKee, I believe after intense negotiations, we're going Apple

269
00:14:37,040 --> 00:14:41,040
Speaker 1: Netflix Game of Thrones. While all of this is a

270
00:14:41,040 --> 00:14:45,280
Speaker 1: little bit Game of Thrones here because Walter Picheck's head

271
00:14:45,320 --> 00:14:48,440
Speaker 1: is on the line here. I guess if he committed

272
00:14:48,440 --> 00:14:51,400
Speaker 1: the next one often that series. If Apple doesn't perform

273
00:14:51,480 --> 00:14:53,960
Speaker 1: because he says by it, uh, he said, they've got

274
00:14:54,080 --> 00:14:57,680
Speaker 1: to earn something in the coming year, how are they

275
00:14:57,720 --> 00:15:00,640
Speaker 1: going to do that? The latest that I've been reading

276
00:15:00,760 --> 00:15:04,360
Speaker 1: is that basically, if there's a seven in the fall,

277
00:15:05,240 --> 00:15:07,600
Speaker 1: it's going to be sort of a placeholder. No major

278
00:15:08,000 --> 00:15:11,680
Speaker 1: changes out there, And it seems to be getting harder

279
00:15:11,680 --> 00:15:14,040
Speaker 1: and harder to get people excited about a new Apple release.

280
00:15:14,120 --> 00:15:16,920
Speaker 1: That's definitely been in the tech media, and that would

281
00:15:16,960 --> 00:15:20,200
Speaker 1: be I think not a good thing, because again, if

282
00:15:20,200 --> 00:15:22,600
Speaker 1: you need to return to growth, there's not many other

283
00:15:22,600 --> 00:15:25,400
Speaker 1: products sectors that can do that. Everyone talks about or

284
00:15:25,400 --> 00:15:27,600
Speaker 1: a lot of people have been talking about services. Services

285
00:15:27,680 --> 00:15:30,080
Speaker 1: is only twelve of their business. So even if that

286
00:15:30,440 --> 00:15:34,280
Speaker 1: performs phenomenally well, it's not going to enable itself or

287
00:15:34,400 --> 00:15:37,600
Speaker 1: enable the company to grow. They need growth in phones.

288
00:15:37,640 --> 00:15:40,840
Speaker 1: And by the way, it's even harder this year because

289
00:15:40,960 --> 00:15:43,320
Speaker 1: a sp S or average sale prices are not going

290
00:15:43,360 --> 00:15:45,800
Speaker 1: to have this this kind of tailwind that they've had

291
00:15:45,840 --> 00:15:48,800
Speaker 1: in recent years because of this mixed shift to the larger,

292
00:15:48,840 --> 00:15:52,040
Speaker 1: more expensive phones or the higher capacity phones. So they

293
00:15:52,040 --> 00:15:55,000
Speaker 1: actually really need to grow those units in the December quarters.

294
00:15:55,040 --> 00:15:58,080
Speaker 1: So if you're saying that we believe the tech media

295
00:15:58,200 --> 00:16:01,640
Speaker 1: out there um that there's not me a substantial change,

296
00:16:01,840 --> 00:16:04,760
Speaker 1: or that there's gonna be more press about the changes

297
00:16:04,800 --> 00:16:07,240
Speaker 1: that are gonna be more exciting next year, that's gonna

298
00:16:07,320 --> 00:16:11,360
Speaker 1: just make that that goal of growing units that much harder. Now,

299
00:16:11,400 --> 00:16:13,840
Speaker 1: when we look at the US UM and some of

300
00:16:13,840 --> 00:16:17,080
Speaker 1: these other markets, I still think their position well um

301
00:16:17,080 --> 00:16:19,040
Speaker 1: to be able to return to growth in in that

302
00:16:19,120 --> 00:16:21,400
Speaker 1: in that fourth courd that people have aging product that

303
00:16:21,400 --> 00:16:23,920
Speaker 1: that needs to be updated. It may be that they

304
00:16:24,000 --> 00:16:26,840
Speaker 1: end up buying the legacy products, the older models as

305
00:16:26,880 --> 00:16:29,800
Speaker 1: the pricing comes down, but ultimately they really need to

306
00:16:29,800 --> 00:16:32,600
Speaker 1: get that unit growth going. They need to get that

307
00:16:32,720 --> 00:16:35,760
Speaker 1: unit growth going so that you'll continue to tell people

308
00:16:35,880 --> 00:16:39,040
Speaker 1: to buy the stock. Uh and then the stock goes up,

309
00:16:39,120 --> 00:16:42,040
Speaker 1: and in theory, that makes them happy. But the question

310
00:16:42,080 --> 00:16:44,040
Speaker 1: I keep coming back to is does Tim Cook care?

311
00:16:44,440 --> 00:16:47,000
Speaker 1: I mean, is he sitting there going, I gotta given

312
00:16:47,080 --> 00:16:49,800
Speaker 1: where Apple is in the universe, I've got to increase

313
00:16:50,120 --> 00:16:54,640
Speaker 1: my quarterly sales every time. Or is he may be saying,

314
00:16:56,000 --> 00:16:58,360
Speaker 1: this is a mature company and we'll work on the car,

315
00:16:58,680 --> 00:17:00,680
Speaker 1: or we'll work on the television or whatever, and we'll

316
00:17:00,680 --> 00:17:02,080
Speaker 1: get to it when we get to it, and we'll

317
00:17:02,080 --> 00:17:04,760
Speaker 1: make money when we make money. I think his willingness

318
00:17:04,840 --> 00:17:08,520
Speaker 1: to appear in financial media is pretty good evidence that

319
00:17:08,560 --> 00:17:11,199
Speaker 1: he cares. In fact, some investors may look at that

320
00:17:11,240 --> 00:17:13,600
Speaker 1: and say, you shouldn't care. You should just focus on

321
00:17:13,640 --> 00:17:15,800
Speaker 1: making good products and the success will follow. But the

322
00:17:16,040 --> 00:17:19,640
Speaker 1: reality is he has been I think visible. You could

323
00:17:19,720 --> 00:17:23,200
Speaker 1: argue that buying stock back after getting pressure from certain

324
00:17:23,200 --> 00:17:27,240
Speaker 1: investors also is evidence that he cares versus focusing on

325
00:17:27,320 --> 00:17:31,040
Speaker 1: making the products they're gonna deliver growth to the company.

326
00:17:31,320 --> 00:17:32,760
Speaker 1: It's fine if you want to say, hey, we want

327
00:17:32,760 --> 00:17:34,960
Speaker 1: to make the best products in the world, and we're

328
00:17:34,960 --> 00:17:36,760
Speaker 1: not going to grow our units because we're not gonna

329
00:17:36,840 --> 00:17:39,360
Speaker 1: just you know, come out with something cheap. But if

330
00:17:39,359 --> 00:17:42,720
Speaker 1: you're delivering declining revenue and declining earnings, you're just gonna

331
00:17:42,720 --> 00:17:47,200
Speaker 1: get valued differently. That's the reality. I'm over your tweeting,

332
00:17:47,320 --> 00:17:50,280
Speaker 1: just keep going. If I still wonder why they're not

333
00:17:50,359 --> 00:17:52,080
Speaker 1: using all of their cash to buy things, And if

334
00:17:52,119 --> 00:17:54,840
Speaker 1: you look at like Facebook, which spent nineteen billion to

335
00:17:54,920 --> 00:17:57,440
Speaker 1: or eighteen billion to buy WhatsApp to try to own

336
00:17:57,480 --> 00:17:59,960
Speaker 1: the category of messaging, it's still interesting that the companies

337
00:18:00,000 --> 00:18:03,119
Speaker 1: like Apple haven't stepped in, or even Google haven't stepped

338
00:18:03,160 --> 00:18:05,960
Speaker 1: in with those massive acquisitions. In the what I would

339
00:18:05,960 --> 00:18:09,680
Speaker 1: call the services end of the business. There are there

340
00:18:09,680 --> 00:18:14,960
Speaker 1: are people who, you know, company leaders, who say we

341
00:18:15,000 --> 00:18:18,439
Speaker 1: should do what we're good at, and Apple hasn't proven

342
00:18:18,520 --> 00:18:22,680
Speaker 1: to be good at um creating its own content, so

343
00:18:23,320 --> 00:18:27,320
Speaker 1: maybe that's why. You know, it's just there is this

344
00:18:27,359 --> 00:18:33,399
Speaker 1: whole world of communication services that seems central um to

345
00:18:33,520 --> 00:18:35,960
Speaker 1: their business. You know, Google's obviously trying to make another

346
00:18:36,040 --> 00:18:39,920
Speaker 1: run at communication services with what they're rolling out. Obviously

347
00:18:39,920 --> 00:18:42,800
Speaker 1: Amazon with Alexa. I mean that disclosure last week that

348
00:18:43,000 --> 00:18:46,480
Speaker 1: Amazon's got a thousand people working on Alexa is fascinating

349
00:18:46,480 --> 00:18:48,360
Speaker 1: when you think about how they want to have we're

350
00:18:48,359 --> 00:18:51,720
Speaker 1: communications and tying it to the ecosystem of hardware that

351
00:18:51,760 --> 00:18:54,240
Speaker 1: they're creating and all their other things that they do

352
00:18:54,520 --> 00:18:58,800
Speaker 1: seems central to their long term missions. Alexa. Tom woke up, No, no, no,

353
00:18:58,920 --> 00:19:01,960
Speaker 1: this is this isn't You don't follow Amazon do here?

354
00:19:02,040 --> 00:19:04,040
Speaker 1: I don't officially, but I spend a lot of time

355
00:19:04,040 --> 00:19:08,000
Speaker 1: thinking about complications. Are they the new digital company? I

356
00:19:08,040 --> 00:19:10,800
Speaker 1: mean I'm seeing them everywhere there with with Stillman's Love

357
00:19:10,840 --> 00:19:13,240
Speaker 1: and Friendship movie. They're doing movies, They're doing this, They're

358
00:19:13,240 --> 00:19:18,160
Speaker 1: doing this. Are they the silent digital rich Greenfield? Look

359
00:19:18,200 --> 00:19:21,000
Speaker 1: from a much higher level, every company that we're talking about,

360
00:19:21,000 --> 00:19:23,280
Speaker 1: whether it's Google, Apple, Amazon, they're all trying to keep

361
00:19:23,280 --> 00:19:25,960
Speaker 1: you in their ecosystem longer, and they're trying to create

362
00:19:25,960 --> 00:19:29,080
Speaker 1: products and services that keep you locked in that ecosystem.

363
00:19:29,080 --> 00:19:31,320
Speaker 1: For Amazon, it's to selling you more for apples that

364
00:19:31,440 --> 00:19:34,760
Speaker 1: sell you more to Nelix, succeeding at that. Netflix is

365
00:19:34,800 --> 00:19:36,800
Speaker 1: really succeeding at that. I mean they're creating more and

366
00:19:36,840 --> 00:19:39,560
Speaker 1: more content that's giving and there on every device. So

367
00:19:39,600 --> 00:19:43,199
Speaker 1: they've got universal distribution now globally anywhere you go. You

368
00:19:43,200 --> 00:19:46,720
Speaker 1: can turn on Netflix on any device that's i P enabled,

369
00:19:47,040 --> 00:19:50,080
Speaker 1: and the content they're producing is better and better. And look,

370
00:19:50,359 --> 00:19:53,760
Speaker 1: they're now doing original series in India, they're doing original

371
00:19:53,760 --> 00:19:58,360
Speaker 1: series in Japan. They're copying the model for Netflix. I'm

372
00:19:58,400 --> 00:20:00,760
Speaker 1: suspect we're having a lot of fun. B G. I G.

373
00:20:00,800 --> 00:20:07,440
Speaker 1: Walter Pisa, Ritz Greenfield on the media, Bloomberg Surveillance coming

374
00:20:07,480 --> 00:20:09,560
Speaker 1: up with all due respect. Highlight brought you by land Rover.

375
00:20:09,680 --> 00:20:11,080
Speaker 1: If it's in your nature to cast off the every

376
00:20:11,119 --> 00:20:13,200
Speaker 1: day and seek adventure, the Discovery Sport was built to

377
00:20:13,200 --> 00:20:15,320
Speaker 1: help your search. Visit landroverer Ye state dot com or

378
00:20:15,359 --> 00:20:18,440
Speaker 1: called one Fine for DVD for details land Rover Above

379
00:20:18,480 --> 00:20:27,720
Speaker 1: and Beyond broadcasting live to New York, Gloomberg eleventh to Washington,

380
00:20:27,800 --> 00:20:32,840
Speaker 1: d C, Bloomberg to Boston, Bloomberg twelve hounds to San Francisco,

381
00:20:32,960 --> 00:20:37,960
Speaker 1: Bloomberg to the Countries, sees Exam Channel one and around

382
00:20:38,000 --> 00:20:41,520
Speaker 1: the globe, the Bloomberg Radio Plus Appen Bloomberg dot Com.

383
00:20:41,600 --> 00:20:45,360
Speaker 1: This is Bloomberg Surveillance the morning, eight thirty on All

384
00:20:45,400 --> 00:20:48,639
Speaker 1: Straight and Michael McKee along with Tom keenar economic indicators

385
00:20:48,640 --> 00:20:51,080
Speaker 1: brought you by Commonwealth Financial Network. When it's time to

386
00:20:51,160 --> 00:20:53,600
Speaker 1: change the conversation, talk about the broker dealer r I

387
00:20:53,760 --> 00:20:55,920
Speaker 1: A that's ready to listen Call eight six six or

388
00:20:56,000 --> 00:20:58,760
Speaker 1: six two three six three eight or visit Commonwealth dot

389
00:20:58,800 --> 00:21:02,040
Speaker 1: com to Lord war video. Dell Judas is at the

390
00:21:02,080 --> 00:21:06,360
Speaker 1: First Word Desk, making himself very productive. Michael. Yes, News

391
00:21:06,359 --> 00:21:10,000
Speaker 1: from the Labor Department. Revised data on non farm productivity

392
00:21:10,240 --> 00:21:14,440
Speaker 1: down point six percent in the first quarter as forecast,

393
00:21:14,720 --> 00:21:17,720
Speaker 1: not quite as sharp as decline as in the initial estimate,

394
00:21:17,920 --> 00:21:21,400
Speaker 1: which was down one percent. Unit labor costs meantime up

395
00:21:21,440 --> 00:21:24,439
Speaker 1: more than forecasts, up more than the prior estimate, plus

396
00:21:24,560 --> 00:21:27,719
Speaker 1: four point five percent in the first quarter. Later today,

397
00:21:27,960 --> 00:21:31,000
Speaker 1: Federal Reserve data and consumer credit at the Bloomberg First

398
00:21:31,000 --> 00:21:33,720
Speaker 1: Work Desk, Vidy Dell Judas. Let's go back to New York. Mike,

399
00:21:33,800 --> 00:21:36,560
Speaker 1: you are good at this. I'm not, but we are

400
00:21:36,600 --> 00:21:39,360
Speaker 1: remissing the media that we don't go beneath the headline

401
00:21:39,440 --> 00:21:44,800
Speaker 1: data and productivity. Mike, I've just gone to compensation per hour. Boy,

402
00:21:44,880 --> 00:21:49,680
Speaker 1: that's a good statistic. Three point seven percent compensation per

403
00:21:49,680 --> 00:21:54,600
Speaker 1: hour is a awfully good number given the gloom of productivity. Well,

404
00:21:54,720 --> 00:21:58,800
Speaker 1: it's got to continue. Yeah, see that grow there. It

405
00:21:58,920 --> 00:22:02,159
Speaker 1: is a two correction surveillance corrections. First of all, with

406
00:22:02,320 --> 00:22:05,119
Speaker 1: US Walter Pisk and Rich Greenfield of b T I

407
00:22:05,160 --> 00:22:07,600
Speaker 1: G as we look at the media this entire hour,

408
00:22:08,280 --> 00:22:11,800
Speaker 1: a surveillance correction. I previously suggested that Mr Greenfield had

409
00:22:11,800 --> 00:22:16,000
Speaker 1: spent time in jail over some security analysis of a

410
00:22:16,040 --> 00:22:19,240
Speaker 1: year ago. I misconstrued. I was so dazzled by his

411
00:22:19,320 --> 00:22:22,360
Speaker 1: Twitter dam and stardom. I what I meant to suggest

412
00:22:22,440 --> 00:22:26,320
Speaker 1: was people would like him to go to jail. Which

413
00:22:26,400 --> 00:22:29,560
Speaker 1: which conference call you're not allowed to go on? Right now?

414
00:22:29,840 --> 00:22:32,000
Speaker 1: My god? The list is growing by the day, Tom,

415
00:22:32,000 --> 00:22:34,440
Speaker 1: It just keeps growing. They don't even know why I

416
00:22:34,520 --> 00:22:37,200
Speaker 1: bother dialing in it. If they ever done that, is it?

417
00:22:37,400 --> 00:22:39,000
Speaker 1: A company ever said to you you can't go on

418
00:22:39,040 --> 00:22:43,240
Speaker 1: a call, um now? But you know, Disney said that

419
00:22:43,320 --> 00:22:47,119
Speaker 1: they take into account how analysts have treated the company

420
00:22:47,119 --> 00:22:49,160
Speaker 1: when they decide who gets to ask questions. There's plenty

421
00:22:49,160 --> 00:22:52,280
Speaker 1: of examples where I've hit star zero asked the operator

422
00:22:52,359 --> 00:22:54,119
Speaker 1: and say how com on my questions not getting well

423
00:22:54,119 --> 00:22:56,520
Speaker 1: the company has asked you not be allowed to ask

424
00:22:56,560 --> 00:22:59,080
Speaker 1: a question to call and the other issue, Mike as

425
00:22:59,080 --> 00:23:01,840
Speaker 1: I just took a cheerful photos for Twitter in the

426
00:23:01,840 --> 00:23:06,720
Speaker 1: glorious glow of our world headquarters. The picture that Walter

427
00:23:06,800 --> 00:23:09,199
Speaker 1: Pis put out on Twitter looked like we're in a

428
00:23:09,280 --> 00:23:13,560
Speaker 1: crypt and twelve century church. It's not that gloomy, folks,

429
00:23:13,560 --> 00:23:16,240
Speaker 1: for those who look at your Walter Walter b t

430
00:23:18,240 --> 00:23:21,120
Speaker 1: It's somewhere in the middle. So let's go on Netflix.

431
00:23:21,160 --> 00:23:23,399
Speaker 1: What are we gonna talk about, Michael Netflix. I I

432
00:23:23,480 --> 00:23:26,479
Speaker 1: quit getting Netflix because the movies I wanted on it

433
00:23:26,520 --> 00:23:29,920
Speaker 1: we're never on it. I'm in the minority, right, Yeah,

434
00:23:29,960 --> 00:23:33,280
Speaker 1: I mean I've noticed that. Okay, that's fine. I mean

435
00:23:33,320 --> 00:23:36,960
Speaker 1: there certainly is a less there's less fresh movies today,

436
00:23:37,400 --> 00:23:39,919
Speaker 1: and by fresh meaning nine month old movies because you know,

437
00:23:39,960 --> 00:23:42,600
Speaker 1: you're still subject to all the different windows that are

438
00:23:42,720 --> 00:23:45,119
Speaker 1: that everyone else like HBO and Showtime are subject to.

439
00:23:45,720 --> 00:23:48,680
Speaker 1: But the TV contents exploded in terms of the amount

440
00:23:48,720 --> 00:23:52,080
Speaker 1: of content. There's basically a new show, series, or special

441
00:23:52,160 --> 00:23:55,320
Speaker 1: or movie that drops basically every single week of the year,

442
00:23:56,000 --> 00:23:58,920
Speaker 1: and that's led to the average household. So they've got

443
00:23:59,040 --> 00:24:02,400
Speaker 1: their closing in on sea million households or fifty million subscribers.

444
00:24:02,720 --> 00:24:06,160
Speaker 1: The average subscriber is streaming over two hours per day

445
00:24:06,160 --> 00:24:09,520
Speaker 1: across the family. That's a pretty crazy statistic when you

446
00:24:09,560 --> 00:24:12,560
Speaker 1: think that the average household watches call it eight hours

447
00:24:12,560 --> 00:24:16,440
Speaker 1: of TV a day historically, so two hours for Netflix.

448
00:24:16,800 --> 00:24:20,199
Speaker 1: The amount of video viewing shifting to Netflix is significant

449
00:24:20,240 --> 00:24:23,040
Speaker 1: and it's leading to lower and lower churn. And Mike,

450
00:24:23,040 --> 00:24:25,480
Speaker 1: do you want to make thirty per year over the

451
00:24:25,520 --> 00:24:28,879
Speaker 1: last ten years? I mean, you know it's held up

452
00:24:28,920 --> 00:24:33,280
Speaker 1: well least are they properly priced? In other words, given

453
00:24:33,480 --> 00:24:37,600
Speaker 1: how much streaming they're doing, can they raise prices on people?

454
00:24:37,840 --> 00:24:40,960
Speaker 1: Will Sonny? You mentioned Game of Thrones before, and you

455
00:24:41,000 --> 00:24:45,040
Speaker 1: know who's gonna get executed next? Hopefully it's not Walter Um.

456
00:24:45,080 --> 00:24:46,920
Speaker 1: But think about it. What's the second best show on

457
00:24:47,040 --> 00:24:51,520
Speaker 1: HBO right now, Tom, second best show on HBO, the

458
00:24:51,600 --> 00:24:56,560
Speaker 1: second most iconic show. Yeah, that shouldn't be. That shouldn't be.

459
00:24:56,640 --> 00:24:59,320
Speaker 1: And so HBO is fifteen dollars a month and you're

460
00:24:59,359 --> 00:25:03,400
Speaker 1: essentially right now paying for one amazing show. Yes, Silicon

461
00:25:03,480 --> 00:25:05,879
Speaker 1: Valley is good, and Veep is there's a bunch of

462
00:25:05,960 --> 00:25:08,440
Speaker 1: second tier shows that are good, but they're certainly they're

463
00:25:08,440 --> 00:25:10,960
Speaker 1: they're failing to find that next iconic show. They've just

464
00:25:11,000 --> 00:25:13,920
Speaker 1: had turnover in the programming department. They're struggling to find

465
00:25:13,960 --> 00:25:16,560
Speaker 1: that next show. So I think Netflix, having just raised

466
00:25:16,560 --> 00:25:18,600
Speaker 1: price or in the process of raising price, to ten

467
00:25:18,640 --> 00:25:21,439
Speaker 1: dollars a month, with a suite of shows that people

468
00:25:21,480 --> 00:25:23,840
Speaker 1: could name right now, whether it's House of Cards or Bloodline,

469
00:25:23,920 --> 00:25:27,200
Speaker 1: or Oranges in New Black or Narcos, there's enough shows

470
00:25:27,240 --> 00:25:30,000
Speaker 1: the price value. I think they could raise price further.

471
00:25:30,400 --> 00:25:32,360
Speaker 1: I mean, I think they're probably under priced right now

472
00:25:32,720 --> 00:25:35,200
Speaker 1: at ten dollars a month for the amount they're delivering

473
00:25:35,520 --> 00:25:40,400
Speaker 1: and the ease of access across platforms. What becomes of

474
00:25:41,200 --> 00:25:45,560
Speaker 1: conventional they're basically a TV network now with the ability

475
00:25:45,600 --> 00:25:48,720
Speaker 1: to access all the reruns. So what becomes of the

476
00:25:48,760 --> 00:25:52,080
Speaker 1: conventional TV as we know of the ABC, CBS, UH,

477
00:25:52,240 --> 00:25:56,160
Speaker 1: NBC and Fox and their affiliates and all of that. Well,

478
00:25:56,160 --> 00:25:58,760
Speaker 1: I saw a chart, actually tweeted it out. I think

479
00:25:58,760 --> 00:26:02,520
Speaker 1: ad Age had done it showing TV linear TV ratings

480
00:26:02,520 --> 00:26:05,760
Speaker 1: of the five broadcast networks over the course of the

481
00:26:05,880 --> 00:26:09,600
Speaker 1: last ten years. And you know, it's a pretty dramatic decline.

482
00:26:09,960 --> 00:26:12,920
Speaker 1: I mean, consumer behavior is shifting away from live linear TV,

483
00:26:13,160 --> 00:26:17,200
Speaker 1: but the numbers that they still get aren't they higher

484
00:26:17,240 --> 00:26:21,040
Speaker 1: than what a Netflix gets In total? There's obviously still

485
00:26:21,040 --> 00:26:24,440
Speaker 1: more time spent watching broadcast TV, but those numbers are

486
00:26:24,440 --> 00:26:28,800
Speaker 1: falling fast, and advertisers are increasingly concerned about it. You're

487
00:26:28,880 --> 00:26:31,480
Speaker 1: you know, advertising he's doing better this year because we've

488
00:26:31,520 --> 00:26:34,359
Speaker 1: got this crazy election going on, we've got the Olympics.

489
00:26:34,400 --> 00:26:38,000
Speaker 1: But the the overlap, the underlying trend of ratings is

490
00:26:38,080 --> 00:26:40,480
Speaker 1: really a problem. And that's the problem that all these

491
00:26:40,520 --> 00:26:42,520
Speaker 1: media companies are facing. It's why the stocks I mean,

492
00:26:42,680 --> 00:26:44,879
Speaker 1: pull off the stock charts on any of these companies,

493
00:26:45,240 --> 00:26:47,199
Speaker 1: and they're really struggling. I mean, this has not been

494
00:26:47,240 --> 00:26:50,200
Speaker 1: a good last twelve months for this sector. Okay, let's

495
00:26:50,200 --> 00:26:53,720
Speaker 1: continue Rich Greenfield and uh Walter pisk with the thrill

496
00:26:53,800 --> 00:26:55,359
Speaker 1: they have them from B T I G. As we

497
00:26:55,359 --> 00:26:58,400
Speaker 1: look at the digital media, we're gonna touch upon one

498
00:26:58,400 --> 00:27:01,200
Speaker 1: of the dramas of media, uh when we come back,

499
00:27:01,240 --> 00:27:04,720
Speaker 1: and then also a larger broader discussion of where they

500
00:27:04,720 --> 00:27:07,320
Speaker 1: think all of this stuff that we're doing is heading.

501
00:27:07,359 --> 00:27:09,920
Speaker 1: Rich Greenfield is single bust buying Netflix and Walter Pins

502
00:27:10,520 --> 00:27:14,120
Speaker 1: talking up Apple as well. Features up six have given

503
00:27:14,200 --> 00:27:18,360
Speaker 1: way futures now well might help me? Here, my, my,

504
00:27:18,359 --> 00:27:22,880
Speaker 1: my Bloomberg screen is amended. I have to it's amended. Yeah,

505
00:27:23,000 --> 00:27:25,440
Speaker 1: it's what did you do? I? I was so razzled,

506
00:27:25,480 --> 00:27:29,440
Speaker 1: dazzled by having the young futures up three points for

507
00:27:29,680 --> 00:27:32,320
Speaker 1: the SMP Dow features up thirty one, the stock six

508
00:27:32,400 --> 00:27:39,200
Speaker 1: hundred is up four points in Europe. This harrish havannens

509
00:27:39,240 --> 00:27:41,400
Speaker 1: brought here by b MW Mount Kisco is at BMW

510
00:27:41,600 --> 00:27:45,080
Speaker 1: mount kissco dot com. Here is John Tucker with news headlines.

511
00:27:45,400 --> 00:27:48,520
Speaker 1: And Hillary Clinton had secured the delicates required to claim

512
00:27:48,560 --> 00:27:52,320
Speaker 1: the Democratic presidential nomination, putting further pressure on Bernie Sanders

513
00:27:52,359 --> 00:27:55,520
Speaker 1: to exit the race in a battle. Donald Trump urgently

514
00:27:55,600 --> 00:27:58,480
Speaker 1: rallied his most visible supporters to defenders attacks in the

515
00:27:58,520 --> 00:28:02,520
Speaker 1: federal judges Mexican ancestry during a conference call up Monday,

516
00:28:02,560 --> 00:28:05,120
Speaker 1: in which he ordered them to question the judges credibility

517
00:28:05,440 --> 00:28:09,679
Speaker 1: and target reporters asking questions about it top officials. As

518
00:28:09,680 --> 00:28:12,400
Speaker 1: a car bob attack targeted the police vehicle in Istanbul,

519
00:28:12,680 --> 00:28:15,440
Speaker 1: killing eleven people. At least thirty six were hurt. The

520
00:28:15,520 --> 00:28:20,000
Speaker 1: dead included seven police officers no claims of responsibility, and

521
00:28:20,160 --> 00:28:23,000
Speaker 1: the first government report on student absenteeism shows more than

522
00:28:23,080 --> 00:28:25,880
Speaker 1: one out of every ten students mrs at least three

523
00:28:25,920 --> 00:28:30,160
Speaker 1: full weeks of school every year. Global News twenty four

524
00:28:30,160 --> 00:28:32,640
Speaker 1: hours a day, powered by our twenty four hundred journalists.

525
00:28:32,640 --> 00:28:34,680
Speaker 1: He had more than one hundred fifty news bureaus around

526
00:28:34,720 --> 00:28:38,600
Speaker 1: the world. I'm John Tucker, Mike and Tom. Thank you John.

527
00:28:38,640 --> 00:28:42,040
Speaker 1: Time now for the lander Er Percippany Bloomberg NBC Sports

528
00:28:42,120 --> 00:28:46,160
Speaker 1: Update with good Morning, Mike and Tom. The Yankees, they

529
00:28:46,160 --> 00:28:48,200
Speaker 1: made us wait until the seventh inning. They were down

530
00:28:48,240 --> 00:28:51,040
Speaker 1: to nothing before those baths came alive. Brian McCann and

531
00:28:51,160 --> 00:28:54,560
Speaker 1: Starling Castro tied it with solo shots. Carlos Beltron out

532
00:28:54,600 --> 00:28:57,480
Speaker 1: of Homer in the eighth, came from behind for a

533
00:28:57,600 --> 00:29:00,320
Speaker 1: five to win over the Angels in the old winning

534
00:29:00,320 --> 00:29:02,640
Speaker 1: game of the series, and the Bronx massa Harol Sanaka

535
00:29:02,800 --> 00:29:04,479
Speaker 1: put him in position and when he gave up two

536
00:29:04,560 --> 00:29:06,640
Speaker 1: runs and seven and He's Andrew Miller struck out the

537
00:29:06,680 --> 00:29:08,840
Speaker 1: side and the eighth to earn the win, while Rold

538
00:29:09,160 --> 00:29:12,280
Speaker 1: Chapman notched his tense safe series continues Tonight, David huf

539
00:29:12,360 --> 00:29:15,280
Speaker 1: squares off against Michael Pineda. Skipper Joe Girardi gave us

540
00:29:15,280 --> 00:29:17,320
Speaker 1: a much needed update on Mark to share his knee.

541
00:29:17,400 --> 00:29:19,720
Speaker 1: Our goal is to try to get him baseball ready

542
00:29:19,760 --> 00:29:22,200
Speaker 1: in three weeks, okay, to see where we're at. I

543
00:29:22,240 --> 00:29:24,240
Speaker 1: can't tell you it's gonna be three weeks, but that's

544
00:29:24,280 --> 00:29:27,320
Speaker 1: our goal through treatment and all the other things that

545
00:29:27,360 --> 00:29:29,680
Speaker 1: he'll go through. And when I say baseball ready, that

546
00:29:29,680 --> 00:29:31,920
Speaker 1: would mean that he would be ready to play in

547
00:29:31,960 --> 00:29:35,080
Speaker 1: the game. To share it last played on Friday in

548
00:29:35,160 --> 00:29:37,720
Speaker 1: his one for his last eighteen Mats and Pirates. He'll

549
00:29:37,720 --> 00:29:40,040
Speaker 1: play two in Pittsburgh as mother and nature got the

550
00:29:40,040 --> 00:29:42,440
Speaker 1: best of him. On Monday, Stephen Matts and Jonathan Nice

551
00:29:42,440 --> 00:29:45,080
Speaker 1: and the Matinee, followed by Jacob de Graham and One

552
00:29:45,160 --> 00:29:48,120
Speaker 1: Nicasio on the ice Stanley Cup Final. Penguins one win

553
00:29:48,160 --> 00:29:50,680
Speaker 1: away from capturing their second Cup in the last decade.

554
00:29:50,680 --> 00:29:54,000
Speaker 1: They dominated San jose A three to one. Coach Mike Sullivan.

555
00:29:54,120 --> 00:29:56,280
Speaker 1: When they just play within themselves and they take what

556
00:29:56,360 --> 00:29:58,200
Speaker 1: the game gives them, and when the plays aren't there

557
00:29:58,240 --> 00:30:00,480
Speaker 1: to be made, they make simple plays. That's and we

558
00:30:00,600 --> 00:30:02,880
Speaker 1: as a group become more difficult to play against. We

559
00:30:02,920 --> 00:30:05,680
Speaker 1: don't feed our opponents transition game. It would be their

560
00:30:05,760 --> 00:30:09,280
Speaker 1: fourth Cup with four different coaches. Game five Thursday at

561
00:30:09,320 --> 00:30:12,440
Speaker 1: the Igloo and n n A ratings Champ Campbell Slice

562
00:30:12,480 --> 00:30:14,959
Speaker 1: has died at the age of forty two of heart failure.

563
00:30:15,200 --> 00:30:18,040
Speaker 1: He was scheduled to fight in London this July. That's

564
00:30:18,040 --> 00:30:21,320
Speaker 1: your NBC Bloomberg Sports update, Mike Ton, thanks so much,

565
00:30:21,320 --> 00:30:24,080
Speaker 1: greatly appreciate like a little bit of hockey here. It's

566
00:30:24,160 --> 00:30:28,320
Speaker 1: really subsided because the NBA is such, you know, two huge,

567
00:30:28,400 --> 00:30:30,719
Speaker 1: huge teams in the NBA, and it's hard to generate

568
00:30:30,760 --> 00:30:33,920
Speaker 1: a lot of enthusiasm for Pittsburgh. Other than that's true.

569
00:30:34,000 --> 00:30:36,600
Speaker 1: The seat opposite me in the studio, that's true. I

570
00:30:37,440 --> 00:30:39,320
Speaker 1: could say that. But but it's fun to watch and

571
00:30:40,160 --> 00:30:43,880
Speaker 1: close games, and uh, it shows a difference between big

572
00:30:43,880 --> 00:30:47,520
Speaker 1: market small market teams. Now it grabs the nation. I mean,

573
00:30:47,560 --> 00:30:51,000
Speaker 1: it would be very different if it was New Yorker. Well,

574
00:30:51,040 --> 00:30:53,240
Speaker 1: she got a big market in the NBA. But there's

575
00:30:53,280 --> 00:30:57,280
Speaker 1: a storyline there. Everybody likes the Lebron story, so everybody

576
00:30:57,280 --> 00:31:00,920
Speaker 1: pays attention. Our storyline is Richard Greenfield and enterprise with us,

577
00:31:00,920 --> 00:31:04,440
Speaker 1: we're gonna come back and talk to them about truly,

578
00:31:04,600 --> 00:31:07,280
Speaker 1: I mean where Rich Greenfield says he's never seen this.

579
00:31:07,920 --> 00:31:11,320
Speaker 1: That's a big deal on the never seen this of

580
00:31:11,360 --> 00:31:14,120
Speaker 1: the moment, Walter Pick and Rich Greenfield and b T

581
00:31:14,280 --> 00:31:21,960
Speaker 1: I g stay with us. Bloomberg Surveillance. The sports apart

582
00:31:22,000 --> 00:31:23,760
Speaker 1: brought to you by Lander Over Parcipiti. If it's in

583
00:31:23,760 --> 00:31:25,640
Speaker 1: your nature to cast off the every day and seek adventure,

584
00:31:25,640 --> 00:31:27,720
Speaker 1: the Discovery Sport was built to help your search. Visit

585
00:31:27,800 --> 00:31:31,840
Speaker 1: land over Parcipiti dot com or land Roman Above and

586
00:31:31,920 --> 00:31:40,640
Speaker 1: beyond Global business news twenty four hours a day at

587
00:31:40,640 --> 00:31:43,680
Speaker 1: Bloomberg dot com, the Radio plus Mobile lapp and on

588
00:31:43,720 --> 00:31:47,600
Speaker 1: your radio. This is a Bloomberg Business Flash and I'm

589
00:31:47,640 --> 00:31:50,000
Speaker 1: Karin Moscow. This updates brought to you by van X

590
00:31:50,080 --> 00:31:53,240
Speaker 1: Vectors et F. Expect more from your muni's target tax

591
00:31:53,240 --> 00:31:56,360
Speaker 1: exempt income by maturity and credit quality. OH with a

592
00:31:56,480 --> 00:31:59,440
Speaker 1: low cost e t FS visit Vanech dot com slash

593
00:31:59,520 --> 00:32:04,520
Speaker 1: Muni Vanek access the opportunities. Stocks are rallying with emerging

594
00:32:04,560 --> 00:32:07,360
Speaker 1: markets as investors added to bets that US interest rates

595
00:32:07,400 --> 00:32:10,040
Speaker 1: will stay lower for longer, keeping growth on track. But

596
00:32:10,200 --> 00:32:12,880
Speaker 1: checked the markets every fifteen minutes throughout the trading day

597
00:32:12,920 --> 00:32:16,520
Speaker 1: on Bloomberg SNP Emni Future is up about three points now,

598
00:32:16,600 --> 00:32:19,440
Speaker 1: DOWI many futures up thirty three now, is DOCU many

599
00:32:19,480 --> 00:32:21,680
Speaker 1: futures up five and a half. That acts in Germany's

600
00:32:21,720 --> 00:32:24,120
Speaker 1: up one and a half percent. Ten your treasury of

601
00:32:24,200 --> 00:32:26,840
Speaker 1: six thirty seconds, the yield one point seven one percent.

602
00:32:27,240 --> 00:32:29,680
Speaker 1: Nimex s crude oil up one percent or fifty one

603
00:32:29,680 --> 00:32:32,440
Speaker 1: cents to fifty dollars twenty cents of barrel Go Mix's

604
00:32:32,480 --> 00:32:35,000
Speaker 1: gold is down seven ten percent or eight dollars forty

605
00:32:35,080 --> 00:32:37,840
Speaker 1: cents to twelve thirty nine. Announced the euro at all

606
00:32:37,880 --> 00:32:40,440
Speaker 1: our thirteen fifty two. The yen one oh seven point

607
00:32:40,600 --> 00:32:44,880
Speaker 1: six zero. Ralph Lauren is down ten percent this morning

608
00:32:44,880 --> 00:32:47,440
Speaker 1: after the company predicted a percentage sales decline in the

609
00:32:47,440 --> 00:32:51,040
Speaker 1: low double digits this year as it closes stores. Biogen

610
00:32:51,240 --> 00:32:54,080
Speaker 1: is down almost nine percent after an experimental drug for

611
00:32:54,200 --> 00:32:57,200
Speaker 1: multiple sclerosis, which had held that hope of altering the

612
00:32:57,200 --> 00:33:00,280
Speaker 1: course of the disease, failed in a mid stage aisle,

613
00:33:00,600 --> 00:33:04,840
Speaker 1: and Valiant Pharmaceuticals International cutting its twenties sixteen profit forecast.

614
00:33:04,920 --> 00:33:07,800
Speaker 1: That's a Bloomberg business flash, Tom and Mind Karen thanks

615
00:33:07,840 --> 00:33:13,040
Speaker 1: so much on Wall Street. The following is from Bloomberg

616
00:33:13,120 --> 00:33:17,320
Speaker 1: View opinions and commentary from Bloomberg columnists. I'm Megan McCardell,

617
00:33:17,520 --> 00:33:20,280
Speaker 1: columnist for Bloomberg View. The universal Basic Income is an

618
00:33:20,320 --> 00:33:23,560
Speaker 1: idea whose time has not yet come. Associated Swiss and

619
00:33:23,560 --> 00:33:25,680
Speaker 1: a referendum this weekend in which the idea of a

620
00:33:25,680 --> 00:33:28,520
Speaker 1: basic income ground was overwhelmingly rejected, with more than three

621
00:33:28,600 --> 00:33:31,720
Speaker 1: quarters of the population voting against. Maybe that's because UBI

622
00:33:31,840 --> 00:33:34,800
Speaker 1: has some problems as a policy. The idea is that

623
00:33:34,840 --> 00:33:36,960
Speaker 1: it fixes many of the problems with the existing well

624
00:33:37,080 --> 00:33:40,040
Speaker 1: verre systemlike the distortions inherent in giving people in kind

625
00:33:40,080 --> 00:33:43,160
Speaker 1: benefits like food stamps rather than cash they might rather

626
00:33:43,200 --> 00:33:46,680
Speaker 1: spend on something else. Moreover, the income cutoffs for all

627
00:33:46,680 --> 00:33:49,720
Speaker 1: those various benefits can create absurd marginal tax where it's

628
00:33:49,720 --> 00:33:53,520
Speaker 1: even climbing over we're working more or getting a raise

629
00:33:54,000 --> 00:33:56,520
Speaker 1: literally means you lose more in benefits than you gain

630
00:33:56,560 --> 00:33:59,360
Speaker 1: in salary. The UBI is supposed to solve those problems

631
00:33:59,400 --> 00:34:02,120
Speaker 1: by creating a single benefit that goes to everyone, regardless

632
00:34:02,120 --> 00:34:04,720
Speaker 1: of income, and in theory, by providing a safety net,

633
00:34:05,160 --> 00:34:08,280
Speaker 1: UBI can free potential entrepreneurs and creatives to take risks

634
00:34:08,360 --> 00:34:12,000
Speaker 1: chasing their dreams. Unfortunately, policymakers trying to crafty U b

635
00:34:12,120 --> 00:34:14,279
Speaker 1: I end up with an impalatable choice between creating a

636
00:34:14,280 --> 00:34:16,920
Speaker 1: benefit that's useless or one that's too costly to pass.

637
00:34:17,400 --> 00:34:19,560
Speaker 1: In the US, for example, a benefit of it's just

638
00:34:19,600 --> 00:34:21,719
Speaker 1: a thousand dollars a month, which most of us would

639
00:34:21,760 --> 00:34:24,600
Speaker 1: not consider a viable income, could cost two points seven

640
00:34:24,680 --> 00:34:27,160
Speaker 1: trillion dollars a year, will being less generous than what

641
00:34:27,400 --> 00:34:30,919
Speaker 1: say as typical Social Security recipient now collects. The number

642
00:34:30,960 --> 00:34:33,080
Speaker 1: is different by country, but the math is still the same.

643
00:34:33,480 --> 00:34:36,160
Speaker 1: You can have generous benefits or you can have universal benefits,

644
00:34:36,239 --> 00:34:38,800
Speaker 1: but it's very hard to have both. On Megan McCardell.

645
00:34:38,880 --> 00:34:40,560
Speaker 1: For more of you, please get a Bloomberg View dot

646
00:34:40,600 --> 00:34:43,319
Speaker 1: com or view. Go on the Bloomberg terminal. This has

647
00:34:43,400 --> 00:34:46,920
Speaker 1: been Bloomberg View and Bloomberg View commentaries can be heard

648
00:34:46,960 --> 00:35:01,120
Speaker 1: hourly weekdays on Bloomberg Radio. And there's the music. No,

649
00:35:01,360 --> 00:35:05,560
Speaker 1: it's not about King's landing, it's about the future of viacom.

650
00:35:05,600 --> 00:35:09,360
Speaker 1: Walter pis with this rich greenfield of bt I G.

651
00:35:09,640 --> 00:35:11,719
Speaker 1: I mean it is out of Game of Thrones, which

652
00:35:11,760 --> 00:35:15,120
Speaker 1: you were saying earlier. You've never seen anything like this

653
00:35:15,200 --> 00:35:18,200
Speaker 1: with Mr Redstone and in the heritage of his company.

654
00:35:18,560 --> 00:35:22,680
Speaker 1: I mean, you've got the family essentially fighting the board

655
00:35:22,719 --> 00:35:29,279
Speaker 1: of directors, Philippe dem suing the majority shareholder. This is

656
00:35:29,680 --> 00:35:31,600
Speaker 1: there's nothing like this. I mean, this is a pretty

657
00:35:31,600 --> 00:35:36,120
Speaker 1: crazy battle for control of essentially two public companies. And

658
00:35:36,280 --> 00:35:38,960
Speaker 1: we we also we talk about Viacom, but remember whoever

659
00:35:39,000 --> 00:35:42,840
Speaker 1: controls whoever controls the sum near Redstone Trust, the SMR Trust,

660
00:35:42,840 --> 00:35:47,359
Speaker 1: and National Amusements controls Viacom and CBS. That's exactly where

661
00:35:47,360 --> 00:35:49,720
Speaker 1: I wanted to go in your research. Note. I'm shocked

662
00:35:49,719 --> 00:35:53,000
Speaker 1: at your silence on Mr Moonves. What does he want

663
00:35:53,120 --> 00:35:56,439
Speaker 1: and what can he do? We think it's pretty clear

664
00:35:56,520 --> 00:35:59,719
Speaker 1: that less one is Philippe gone, and that ultimately the

665
00:35:59,719 --> 00:36:02,160
Speaker 1: two companies will get merged back together and less would

666
00:36:02,239 --> 00:36:05,839
Speaker 1: run both companies. We think that's the simplest solution that

667
00:36:05,880 --> 00:36:09,080
Speaker 1: protects value and Viacom, and let's less control in a

668
00:36:09,200 --> 00:36:13,200
Speaker 1: larger platform and hopefully try to begin the process of

669
00:36:13,400 --> 00:36:17,799
Speaker 1: maybe not fixing, but at least improving Viacom's longevity. I

670
00:36:17,840 --> 00:36:22,400
Speaker 1: think the risk is is that um Sharry loses Philippe

671
00:36:22,440 --> 00:36:25,120
Speaker 1: actually wins, which I think is slim odds at this point.

672
00:36:25,320 --> 00:36:27,319
Speaker 1: But if that happened, the question would be would you

673
00:36:27,320 --> 00:36:30,279
Speaker 1: still emerge them together? And would Philip fire Less? That's

674
00:36:30,320 --> 00:36:32,640
Speaker 1: the scary scenario for Lesson. So I think the reality

675
00:36:32,680 --> 00:36:35,080
Speaker 1: is there's only one winner here. This is gonna be

676
00:36:35,080 --> 00:36:37,399
Speaker 1: a winner take off for the two companies. Like this

677
00:36:37,480 --> 00:36:41,000
Speaker 1: is the important thing what Mr Greenfield just said, which

678
00:36:41,080 --> 00:36:43,880
Speaker 1: is Mr mound Is isn't in charge of his destiny,

679
00:36:43,920 --> 00:36:46,959
Speaker 1: which I think a lot of people would be shocked by. Yeah,

680
00:36:47,000 --> 00:36:50,439
Speaker 1: to have a record like he's got. But but why

681
00:36:50,520 --> 00:36:55,080
Speaker 1: would Domo want to get rid of less given his

682
00:36:55,280 --> 00:36:57,320
Speaker 1: track record? Well, I think if you are going to

683
00:36:57,360 --> 00:37:00,320
Speaker 1: emerge the two companies together, if that's the safest action

684
00:37:00,400 --> 00:37:04,480
Speaker 1: to protect Viacom's value, I don't think philippin Less can

685
00:37:04,480 --> 00:37:07,359
Speaker 1: work within the same company. So there's probably only room

686
00:37:07,400 --> 00:37:11,839
Speaker 1: for one ego within that boardroom. And so what's sort

687
00:37:11,840 --> 00:37:14,479
Speaker 1: of like you and Walter now now we work pretty

688
00:37:14,520 --> 00:37:18,399
Speaker 1: well together. Walter's over there looking at the Verizon meeting. Walter,

689
00:37:18,600 --> 00:37:20,719
Speaker 1: is there any nuggets on Verizon today that we need

690
00:37:20,760 --> 00:37:23,399
Speaker 1: to know? They just gave some more details about UM

691
00:37:23,400 --> 00:37:26,479
Speaker 1: what this strike impact was in terms of learnings per share,

692
00:37:26,560 --> 00:37:30,160
Speaker 1: five is seven cents, losing some stuff that was generally expecting. Okay,

693
00:37:30,200 --> 00:37:33,200
Speaker 1: I want to get back to the one single word ecosystem, Walter.

694
00:37:33,320 --> 00:37:36,000
Speaker 1: Let me start with you. Apple has an ecosystem. I

695
00:37:36,000 --> 00:37:38,600
Speaker 1: believe you think it's undervalued. Do they need to go

696
00:37:38,719 --> 00:37:42,440
Speaker 1: find content to help with their hardware ecosystem? I think

697
00:37:42,440 --> 00:37:45,840
Speaker 1: they've tried to do that unsuccessfully. It's been difficult to

698
00:37:45,880 --> 00:37:47,960
Speaker 1: do that. There's many other areas they can extend their

699
00:37:48,000 --> 00:37:50,759
Speaker 1: brand and their presence, and you know, everyone's focused on

700
00:37:50,760 --> 00:37:53,239
Speaker 1: the self driving car of the future and and the

701
00:37:53,520 --> 00:37:55,000
Speaker 1: moves that they have to make to do that. There's

702
00:37:55,040 --> 00:37:56,759
Speaker 1: a lot of R and D going in. There's been

703
00:37:56,760 --> 00:37:59,839
Speaker 1: discussions of them actually making a car. Um, but maybe

704
00:37:59,840 --> 00:38:02,160
Speaker 1: they need to find companies that are that are actually

705
00:38:02,200 --> 00:38:05,280
Speaker 1: operating these cars, like Uber or you know the investment

706
00:38:05,320 --> 00:38:09,680
Speaker 1: that they made in China, which is the Uber competitor there. Well,

707
00:38:09,719 --> 00:38:13,120
Speaker 1: I was just gonna bring a different company into it here.

708
00:38:13,640 --> 00:38:16,799
Speaker 1: Because of what you're talking about self driving car, all

709
00:38:16,800 --> 00:38:19,560
Speaker 1: these things that are not Apple, you know that you

710
00:38:19,560 --> 00:38:24,160
Speaker 1: think of as Apple, and that's alphabet Google, Um. These

711
00:38:24,160 --> 00:38:27,799
Speaker 1: guys have a different sort of belief. They sort of

712
00:38:27,800 --> 00:38:30,800
Speaker 1: throw money at the wall and just see what sticks.

713
00:38:30,800 --> 00:38:33,439
Speaker 1: I mean, there are in a million different areas. Uh.

714
00:38:33,600 --> 00:38:35,799
Speaker 1: I think Facebook's copying that type of model too. If

715
00:38:35,880 --> 00:38:38,880
Speaker 1: you look at it, trying to do planes in developing

716
00:38:38,880 --> 00:38:42,360
Speaker 1: parts of the world to deliver Internet, obviously making massive

717
00:38:42,400 --> 00:38:45,439
Speaker 1: acquisitions like What's App that don't even generate revenue right now.

718
00:38:45,760 --> 00:38:48,759
Speaker 1: I think placing big virtual reality with oculus. If you

719
00:38:48,760 --> 00:38:51,359
Speaker 1: look at Facebook, I think you know, Facebook and Google

720
00:38:51,440 --> 00:38:55,880
Speaker 1: are making some very very big, long term bats. It

721
00:38:56,000 --> 00:38:58,040
Speaker 1: kind of gets it seems to what you were saying

722
00:38:58,040 --> 00:39:00,200
Speaker 1: to us off the air that nobody in me DA

723
00:39:00,280 --> 00:39:02,880
Speaker 1: has any idea right now, no clue what's going to happen.

724
00:39:02,880 --> 00:39:05,080
Speaker 1: They're buying backstock, they don't, you know, they're trying to

725
00:39:05,160 --> 00:39:08,640
Speaker 1: basically live out the next few years while their contracts

726
00:39:08,719 --> 00:39:11,319
Speaker 1: keep paying them ridiculous amounts of money. I mean, if

727
00:39:11,320 --> 00:39:15,640
Speaker 1: you look at the look the top twenty media executives,

728
00:39:15,719 --> 00:39:17,800
Speaker 1: so the top twenty CEOs in American in terms of

729
00:39:17,840 --> 00:39:19,480
Speaker 1: pay in New York Times the other day, I think

730
00:39:19,520 --> 00:39:22,440
Speaker 1: Media had seven of them despite awful stock performance. So

731
00:39:22,480 --> 00:39:26,120
Speaker 1: there's been no connection between compensation for media executives and

732
00:39:26,160 --> 00:39:28,960
Speaker 1: stock price performance. And the reality is all they're doing

733
00:39:29,040 --> 00:39:32,319
Speaker 1: is buying backstock without any None of them has any

734
00:39:32,360 --> 00:39:34,399
Speaker 1: way of figuring out how to get onto the most

735
00:39:34,400 --> 00:39:37,239
Speaker 1: important device and consumers lives, which is mobile devices. And

736
00:39:37,280 --> 00:39:40,600
Speaker 1: that's where all of media right now is failing. Can

737
00:39:41,280 --> 00:39:43,840
Speaker 1: do me as this Walter? Can they do it? Is

738
00:39:45,160 --> 00:39:47,960
Speaker 1: media as we've thought about it, something that can be

739
00:39:48,000 --> 00:39:50,960
Speaker 1: scaled down to a mobile device. I mean, I think

740
00:39:50,960 --> 00:39:53,359
Speaker 1: it already has. You're seeing if anyone has kids or

741
00:39:53,400 --> 00:39:57,560
Speaker 1: anybody how people are watching content the TV is off,

742
00:39:57,640 --> 00:39:59,319
Speaker 1: or even if it's all on the focuses on the

743
00:39:59,360 --> 00:40:02,040
Speaker 1: screen that's in front of you. Um, you know, it's

744
00:40:02,360 --> 00:40:04,279
Speaker 1: it's been perceived a short form. But there's been some

745
00:40:04,360 --> 00:40:07,400
Speaker 1: data that's come out of sand Vine about beaks people

746
00:40:07,440 --> 00:40:11,680
Speaker 1: willing to to watch five minutes of content on devices. Okay,

747
00:40:11,680 --> 00:40:13,960
Speaker 1: so Richie and I go to lunch at Michael's today

748
00:40:14,239 --> 00:40:19,359
Speaker 1: over wherever it is. I thought you like Bill Bill,

749
00:40:19,840 --> 00:40:21,800
Speaker 1: But we go to Michael's and we have a power lunch.

750
00:40:21,800 --> 00:40:24,279
Speaker 1: Where's that lunch going to be in five years? I mean,

751
00:40:24,320 --> 00:40:28,080
Speaker 1: where is is TV per se in five years? If

752
00:40:28,360 --> 00:40:33,120
Speaker 1: Mike's and my kids aren't watching? Uh, you know, I

753
00:40:33,160 --> 00:40:35,120
Speaker 1: think I don't think it's gonna happen in five years,

754
00:40:35,120 --> 00:40:37,240
Speaker 1: but I think over ten years, I think the concept

755
00:40:37,280 --> 00:40:39,600
Speaker 1: of linear TV is going to fade away. I think

756
00:40:39,600 --> 00:40:42,680
Speaker 1: they'll be events that are live, but I think there'll

757
00:40:42,680 --> 00:40:44,480
Speaker 1: be a dramatic you know. I think all content is

758
00:40:44,520 --> 00:40:46,400
Speaker 1: going to be in an I P on demand world,

759
00:40:46,840 --> 00:40:48,600
Speaker 1: and you'll watch it when you want to watch it,

760
00:40:48,600 --> 00:40:50,759
Speaker 1: when you have time, on what device, where you are,

761
00:40:51,160 --> 00:40:55,440
Speaker 1: and you'll tune in for events like the NBA Finals.

762
00:40:55,560 --> 00:40:59,000
Speaker 1: Will sports stay on live free TV or are they

763
00:40:59,040 --> 00:41:01,400
Speaker 1: going to be we'll s Courts has already moved dramatically

764
00:41:01,400 --> 00:41:04,080
Speaker 1: off of free TV. I mean the NBA Finals obviously

765
00:41:04,120 --> 00:41:05,920
Speaker 1: all of the lead up to the NBA was on

766
00:41:06,080 --> 00:41:09,360
Speaker 1: T n T, which was obviously pay TV. You've got

767
00:41:09,400 --> 00:41:12,200
Speaker 1: you know, the NFL has Sunday night games. I mean

768
00:41:12,360 --> 00:41:15,200
Speaker 1: more and more content is moving the Actually the n

769
00:41:15,239 --> 00:41:18,000
Speaker 1: c A Finals March Madness was only on cable this

770
00:41:18,080 --> 00:41:20,080
Speaker 1: year for the first time ever, and so more and

771
00:41:20,080 --> 00:41:23,000
Speaker 1: more content is moving off of free TV. I think

772
00:41:23,040 --> 00:41:25,839
Speaker 1: that trend continues, and I think the reality is all

773
00:41:25,920 --> 00:41:28,200
Speaker 1: that you actually have in terms of quote unquote live

774
00:41:28,840 --> 00:41:31,400
Speaker 1: our events, whether it's the Oscars or whether it's the

775
00:41:31,400 --> 00:41:33,520
Speaker 1: Super Bowl. But I think Beyond that, the idea of

776
00:41:33,560 --> 00:41:38,040
Speaker 1: linear TV to our kids makes Facebook Live has got

777
00:41:38,120 --> 00:41:40,440
Speaker 1: certainly a great platform. You can see, you can engage

778
00:41:40,440 --> 00:41:42,839
Speaker 1: with your friends when the Sunday night game comes on.

779
00:41:43,360 --> 00:41:45,840
Speaker 1: Rather than clicking the television button you're clicking your Apple

780
00:41:45,880 --> 00:41:48,000
Speaker 1: TV or Real coup or whatever it is, bring up

781
00:41:48,000 --> 00:41:51,440
Speaker 1: a Facebook app watching the same exact game, same quality,

782
00:41:51,840 --> 00:41:54,480
Speaker 1: with the added benefit of seeing your friends commented on

783
00:41:54,600 --> 00:41:59,319
Speaker 1: via Facebook Live. So how does you technically could The

784
00:41:59,320 --> 00:42:01,440
Speaker 1: problem is the right are locked up for a long time,

785
00:42:01,719 --> 00:42:04,319
Speaker 1: But technically sure, I mean it's it's you're gonna see

786
00:42:04,320 --> 00:42:06,480
Speaker 1: on Twitter, right. Twitter is gonna have NFL games next year.

787
00:42:07,120 --> 00:42:10,680
Speaker 1: Seconds Disney by hold self sell it's the most overvalued

788
00:42:10,719 --> 00:42:13,760
Speaker 1: company in the space. Numbers, I think Bloomberg shows consensus

789
00:42:13,840 --> 00:42:16,360
Speaker 1: right now of like six seventeen, six eighteen numbers have

790
00:42:16,400 --> 00:42:18,719
Speaker 1: started to come down. We believe they can't earn six

791
00:42:18,760 --> 00:42:22,359
Speaker 1: dollars as as they As numbers come down, everyone's got

792
00:42:22,360 --> 00:42:24,799
Speaker 1: to lower their seventeen numbers. For Disney, they can't make

793
00:42:24,800 --> 00:42:27,319
Speaker 1: those numbers. The stock is gonna be nine year less.

794
00:42:27,480 --> 00:42:30,560
Speaker 1: Let it go, Let it go. I love that. I

795
00:42:30,600 --> 00:42:34,759
Speaker 1: thought fade the forced force. Rich Greenfield, thank you so

796
00:42:36,320 --> 00:42:39,359
Speaker 1: you so. This has been fabulous with be T I G. Again.

797
00:42:39,400 --> 00:42:41,680
Speaker 1: We protect the copyright of all of our guests. We're

798
00:42:41,719 --> 00:42:44,640
Speaker 1: not gonna send you out, But what time field on

799
00:42:44,840 --> 00:42:48,080
Speaker 1: by a cop This is Bloomberg surveillance.