tv Bloomberg Technology Bloomberg December 21, 2017 5:00pm-6:00pm EST
senate before the showdown deadline at the end of the day on friday. the united nations general assembly overwhelmingly backed a measure radical of president recognizecision to jerusalem as the capital of israel. vote came despite of comments.y's on capitol hill, congress wants to use momentum to take on welfare. paul ryan says 2018 is a chance to restructure the safety net. he wants to change good stamps and medicaid programs. in southern california, cap -- firefighters doused hotspots. the huge fire is still smoldering northwest of los angeles. it is 60% contained and now the
second largest in california history. global news, 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. i'm alisa parenti, this is bloomberg. bloomberg technology with emily chang is next. ♪ emily: i'm emily chang and this is bloomberg technology. coming up, we'll take a look at a big year in consumer tech. what worked, what did not and what is worth your money? plus, we discussed facebook's role on the platform for clinical propaganda. is the social network overstepping by helping controversy all world leaders used the platform? ham says the firm
is a tech company at heart. our exclusive interview. advanceddeveloping an hard ponder. is part of a broader push to turn what is a luxury fashion device into a serious medical device. 20% of the population will be using a wearable device by next year. that growth rate is slowing. joining us from chicago, along with a bloomberg tech reporter who broke the story about apple. what exactly are they working on here? ? --already modest your heart it already monitors your heart to a certain extent. moment andin the historical. it shows your heart rate over a. of time. but an ekg, the device they are
, what that is able to do is anticipate future cardiac events. it can see if you are going to have a stroke, or have a blood caught and should see a doctor. it is that preventive medicine and health care which is a huge opportunity for apple, potentially. emily: how does this fit into apple's overall plan? >> the preventive idea is crucial. they have talked a lot about prospects. they are set to grow by as much of a third over the next five to 10 years. they are trying to position the watch toward the health care industry. it senses a great opportunity been just luxury products. waywatch was marketed that to begin with. we do have some breaking news. ofly: the executive
alphabets -- just getting in the full release. google'sidt, who was ceo then became executive chairman. larry page returned as ceo. the then restructured company and became ceo of alphabets and schmidt became executive chairman of apple that. there is likely some more to the story, those schmidt has been at the company for a long time. we will have more on the story momentarily. about appleaking and its health efforts, what is this signify about where apple wants to take the watch, and how much will this help monitor help sales? remains the moment, it something of a luxury. do just asking?
, do you have a watch? they are trying to make it a central part of your life. if you have any concerns about health issues owing forward, you really feel like you need to buy one. emily: nicole, i want you to tell us a little bit about how wearables are doing right now. there was a lot of optimism about the potential for wearable devices but they have not lived up to the hype in terms of adoption. where do things stand right now? nicole: that is exactly the case. back in late 2015, we were very foolish on wearables or it that was primarily because we expected the apple watch to perform very well. when that did not happen, we downgraded our forecast last year significantly. we just updated that again. we bumped it up slightly, but nowhere near where we were at the time. now we estimate that this year, 45 million people in the u.s.
use a wearable at least once a month. next you, that will rise by about 12% to about 50 million u.s. users. emily: just once a month? isn't the goal to be wearing them every day? nicole: most people probably do, but that is how we estimate usage. emily: do you think a feature like a more advanced heart monitoring feature would actually significantly boost sales of something like the apple watch? nicole: like you were saying, they are trying to turn this from a luxury nice to have item into a need to have item. while i think that that kind of health information would be of a lot of interest to some people who have risk factors -- and there are other ways of people watches -- i apple do not know that is something that the mass market will feel like they need. especially at the current price point. emily: so, alex. are talking about how wearables are slowing down and
it seems march speakers are the hot thing this year. they could surpass wearable sales. i wonder if there is a similar question there as to whether they will continue to dominate the market as they are right now? alex: you mean in terms of for the watch itself? i think is interesting with the speaker. when they were first developing the home part, they saw some of the lessons they learned from the watch. they gradually shifted and realized that is how they should market. this is a music device. -- it is interesting the relationship between the two devices. emily: it is coming out early next year. to a lot of competition from google home and amazon echo. alex webb, thank you so much.
nicole, thank you as well. sticking with gadgets, with 2017 coming to an end, big tex companies are still fighting to win your heart. and more notably, your wallet. the biggest offerings from apple, amazon, and google? it has been a jampacked year for new tech products. all the big players are buying for every part of your life. google is no longer just a search company. amazon is more than a retail channel. apple more than ever is going for the high end aaron they are all trying to fight to be your number one. ,pple is going for the high end the smartphone but the iphone x. without a doubt, this was the most anticipated gadget of the year. perhaps the biggest iphone update in the company's history. so far it has been a hit with consumers.
apple is expecting and $80 billion holiday quarter. google wants to sell you a $400, super loud, high-end speaker that works well with it new pixel to phone. amazon is trying to be everywhere in your room. they have released several speakers. devicen alarm clock and of the future. it integrates services and is a solid holiday gift for the tech lover in your home. apple's home pod, will come out in early 2018 after being delayed. the iphone maker is already working on its next iphone as well as an ipad with a psyd for next year. google is working on a new home speaker with a screen where it
amazon is always working on new echoes. happy holidays. emily: that was bloomberg technology's mark gurman. returning to headlines, we prefer you just a few minutes ago out of that saying eric schmidt is stepping down from his executive chairman role to become a technical advisor to the company. this ending a 17 year senior leadership position at the internet giant. joining us now on the transition, number television editor at large cory johnson. cory: i remember when he got the job. it was an amazing thing to see these entrepreneurs with a new ideas get one of the best people in silicon valley. he was well known for what he did. he came with a knowledge of how enterprise software works so much. he was known for his mind in silicon valley. google became one of the great
companies in the history of the world. as much as it was the founders, it was eric schmidt deeply involved. he was an executive chairman. he was very much involved. nonexecutive chairman is a very different job. essentially it is a board level advisory role. he will still have an active role in the business. , just simplyble remarkable what he has done in 17 years at google. emily: so this from larry page. continuing his 17 years of service from the company he will be helping us as a technical advisor. i am incredibly excited about the product our company is making an about the strong leaders driving innovation. presumably that is a reference to other alphabet companies. corey: think about how much --
bruce comes into google that she will pare down some of these things. company witho the a goofy idea of letting smart people give highs salaries and explore things. one of the most interesting things about his long career in technology was recognizing how the very latest development in technology would be very pertinent in the near future in enterprise and consumer facing technology. from silicon valley and putting his company at the forefront of that. emily: the question remains is there anything more to this story? if he transitioning out because he is ready to transition out or is there more? corey: there have been discussions about him going to all kinds of places. we have to get rid of the kinds of places we read in the past
and higher eric schmidt. this guy a so plug-in and understands technology. it means there are a lot of opportunities available to him. he has been moving away from the executive role at google for a long time with the move from ceo to -- >> i remember when that happened. it was 2011. page came in as ceo and in 2015 he restructured and turned the company into a bet. corey: he has had a remarkable career at silicon valley. he has also been very involved in philanthropy. i would not expect that to stop either. emily: thank you for giving us the more context.
sing has raised $50 billion. cash reserves at $12 billion. raised goesmoney toward autonomous car's and electric car charging networks. coming up, facebook there's a lot about getting influential people on this platform. now the company's practice of working with politicians, some use it to silence opponents is under scrutiny. next. this is bloomberg. ♪
elections worldwide continues to be under scrutiny. it is a politically agnostic tool, but they actively work with hearties and leaders. a teamtiative is run by that is neutral and that it works with anyone seeking or securing power. bloomberg's sarah frier broke this story. fascinating story. what exactly does the facebook policy team do? they do withike celebrities or sports stars, this team trains politicians about live video, how to build a base of followers, and all of those tactics that then when they end up running for of office, they have a very close relationship with them and continues to help them. sometimes they turn it into a campaign advertising relationship. emily: this is no matter what their politics.
sarah: absolutely. dutere was one of them. withhave worked closely the far right party in germany. the scottish national party. this is something that facebook just does that based across all kinds of political parties. they drew draw the line at some very strong extremists. they do not work with the far right for example. this is something that is looking very concerning today because we are seeing facebook's influence and power locally in shaping elections. the fact that politicians are anding special training, they are using it against their citizens, definitely is an uncomfortable position for the company to be in. emily: and you spoke with a formal -- a former member of the team because she was uncomfortable.
sarah: right, my colleague spoke with her. she said the team was -- has started to help to create democratic relationships within societies and evolved into an election nearing strategy. she said she did not like how it was turning. emily: back to the question, if facebook is a neutral platform, why do they need to help politicians learn how to use it? everyone else learns how to use it on their own. what are they saying about their role here? sarah: i think it goes back to their long-standing competition with twitter. we have seen twitter become the bullhorn for important people around the world. our president included. naturallyas never been that kind of place for politicians and leaders. so they have had to train and ease people into it. they have been very successful in getting these politicians to get massive followings on their
network. from that perspective, it seems like a good idea. when you look at it from the context of -- now you're helping the people in our, but the citizens in some of these countries may be new to the internet and not as digitally savvy. it creates a power imbalance. frier, thank you so much for sharing that with us. we will continue to follow. coming up, facebook is not only dabbling in politics it is making a push into music. signing a multiyear deal with universal music. how it ends up the competition with youtube, next. this is bloomberg. ♪
songs of the universal label and share using through facebook instagram, and the art technology. joining us from l.a., lucas shaw. lucas: four , they have great ambitions in video. in recent years, any video that is included a song, say you are at your wedding and you dance to that video gets taken down because you do not have the right to use that song and facebook does not have the right to host videos using that song. it has been a source of frustration for users and facebook. this solves that problem for them and in the long, give them the potential to -- improves their relationship with the music business so that it could get the right to professional video in the future. for the music business, it has
been irritating for them to have videos violating copyright on facebook. it helps them establish facebook as a competitor to you to. -- two youtube. emily: do you expect we will see a deal this with other record labels? lucas: yes. facebook has been talking with sony and warner for several months. i do not know if they will announce them or how, i would be surprised that they did not have deals with all three of the majors in the next three months. this signify to the competition, whether it is youtube or spotify. lucas: what you have seen in the music business is there have been growth recently because of paid services like spotify, apple music. free has been an untamed wilderness. youtube is where everyone goes. the music business is trying to bring order to what people can
and cannot listen to for free. universal music, made a deal with spotify that gave them greater control over what music was available for free. with youtube, and a deal announced earlier this week, they got greater control over what music was available for free. if they get to a point with facebook where they spoke is hosting full songs, they will exert a lot of control over what is available for free. you canl want to say listen to any feature you want if you pay. if you are not going to pay come you can only listen to certain songs. they have made a lot of progress this year toward that end. emily: quick question, only 30 seconds left. mark dribbles about a spotify ipo. what is the latest we know? lucas: a report in the wall street journal said the fcc was leaning toward approving their direct listing. it is not a huge surprise, but we had supported earlier the fcc
running for three more weeks. the bill still has to clear the senate before the shutdown deadline on friday. 188.ure passed 231- it would maintain current spending levels through january 2019 and provides emergency funding for missile defense work as well as other pentagon expenses. authorities say the driver of an suv who drove into a crowd is an australian citizen with a history of mental ole miss and no known link to terrorism. vice president pence has outlined president trump's strategy in afghanistan. pence says trump has put pakistan on notice that the country has much to lose if it continues to harbor terrorists. says -- he says too often
they provide safe haven to terrorists and says those days are over. the department of homeland security's internal watchdog says his office will investigate how a small says aws was lanes of dollars in contracts after hurricane maria. he said he would look into why a bronze star llc never delivered the emergency tarps and plastic sheeting as promised. the supplies were needed to cover homes damaged by the storm's wind. i'm alisa parenti. this is bloomberg test after 5:30 p.m. here in washington. it is already the weekend. 6:30 in hong kong. we are joined by sophie with a look at the markets. sophie: already the weekend we are gearing up for a happier friday as we close out the penultimate week of 2017. investors react to the latest
down. the transition and a 17 career -- eric schmidt is stepping down as technical advisor to alphabet. investors large and small are determining how much technology will in florence the market. the company has made strides such as ai and voice recognition to improve the banking experience for its customers. moynihan sat down with us in an exclusive interview and talked about the transformation. >> since i have been ceo i have been trying to do something. we are about $25 billion in coding. that is a lot of feature functionality and improvements. it's about 2.5 to $3 billion per year and a little higher when you'd do mergers and stuff. it's a talented group of teammates and a bunch of huge
computer technology systems and frameworks. that is what we do. money is digital. activity is digital. together for our customers and teammates is huge. what will happen between improvements in voice recognition and artificial intelligent, ada storage and retrieval and wi-fi networks, being able to transmit on a wi-fi basis times of data without having a battery go down in 10 seconds, all of that is important. having all of the data in the world unless the person is going to act on it, which requires storage, analytics, and distribution, the last part you hit a note. the question is you have to have it all come together. the advances are tremendous. when we think about a voice or text artificial intelligence -- >> for bank of america
specifically question mark -- >> we think customers want to get the answer quickly. it takes high-tech. we have millions come into our branches every day, we have to do a great job there. --have to do a great job of erica in that old build and it will interface alexa and other things. what it is really using all of those things -- the number one thing is you can't put it ahead of the customer. all of the digital wallets we android take,y, there is still a small percentage of it. it is growing, and a decade from now it will be a big number, but you have to have it in order to make it go there. year, grown 100% per
year-over-year. it is still a minor amount of payments that go out of customers' accounts. it is a tremendously great project for customers, we just have to drive it out there. without human adoption, we have lost out on that before. we think of ourselves as a technology driven company. when you put it all together, at the end of the day we are high touch and high-tech, because you can't do one without the other. >> in five years, only people work here and how many of them will be -- we would call them tech able now? is there a shift in the balance? ryan: it is hard to say, because it'sve a lot of -- brian: a little hard to say.
you have to realize we are investing and as we downsized ranches we upsize a number of people. everybody is technology oriented. the company has to be. if you go downstairs in the branch you can see they are working off ipads and doing what you can do yourself, because it is the fastest way to do it here coding? no. but they are serving customers there is anlogy, so automated rebalancing based on risk perception, which is growing quickly. it is a piece of technology, but still people need to get behind it. customers never appear, they want to know that i do the right things, did i do this right. we have financial advisors in the branches. david: does it going have a
future in bank of america's existence and what is it? brian: when you separate this question you have the block chain technology. that is most important and i think we have 37 patents already. ways --stry uses it in we have to figure out ways we can verify very complex transactions where a lot of information and money is moving together. when you are talking about is the movement of money, one half of the money move today is moved digitally tiered when you get to anonymous currency, that's a different question. and that is a policy question whether we want an anonymous currency out there and that is where you see people struggle. david: do think we do? brian: i think we wanted. the reason why the largest nomination is $100 bills is to make money harder to move. i think that is what the western
economy learned over time. the ability to find the money is to have it come through in a huge -- in the industry does. it helps you find all kind of interesting things in that is important for law enforcement and other kinds of things. the speculation on what other people reflect on -- you see great debates on it here at the idea of digitizing money is not new. the wire system is a digital system. what is exciting is when you can walk around bryant park and be able to tap your phone or something like that as opposed to carrying dollars. those are exciting things. that's how you and i exchange money if you and i have lunch together. that is exciting. at the end of the day after the expenses, five of them will be
moving coin, currency, and checks around the system. if i can take that down in a safe, verifiable, know your customer -- that is a very valuable thing for us. we could pay them to reprint the money rather than having to cycle it back in and out because it was cheaper to move it around. emily: that was a good america ceo brian moynihan speaking to bloomberg's david westin. disney lost their bid with fox to keep sensitive documents out of the anti-trust case. disney bought to shield the information as well as data on revenue, pricing, and subscribers. the u.s. government seeks to interview as many as 60 witnesses ahead of trial. at the biggest
theory him, to light going, the value of the current he exploded in 2017. one of the biggest players is going base, an online -- is coin base. it almost tripled its base this year now standing at 13 million accounts. he caught up with the ceo talk about the growing interest in cryptocurrency. >> there has been an influx of
interest in digital currency. heart of it has been driven by institutional money getting interested in the space. --have seen large curative large derivatives space. that has driven a lot of interest. it is a signal that traditional institutions are starting to move into digital currency here it -- digital currency. emily: what does that mean for you? does it create new challenges? >> this is an asset class more and more people are going to trade. but we offer spot market data and we are discussing it with them. largest digital institution in the country. we are offering custodian products where a lot of investors need a place to store digital currencies on behalf of their lps and their clients and we lost a product on that called
going base -- called coinbase custody. are you concerned people will go work with more traditional companies and coin base? brian: due to currency moving so fast i do think a company dedicated to it with 200 people will do not industry knowledge over the last five years will have a sustainable competitive advantage. are -- the irs is asking about profits. what are your customers saying about this? unprecedented.y we pushed back strongly. we took it to court. the judge gave us a big vote of
confidence in they ,educed the request of the irs it wasn't down to zero, but it was a partial victory. i think if we look long-term, we want to help people pay all of their taxes on digital currency gains. i think this should look like fidelity or charles scwab where everyone gets to 99 statements. we are working with the irs where everyone can pay their taxes, but this is a new technology that doesn't fit into the existing remark perfectly, and we need to work with everyone. emily: are you giving advice to your clients about how to report their game to the irs? brian: we try to stay away from tax advice. that is not what we do. but we do provide them a cost basis report they can send to their accountant. that's it we have in place until
there is something like 1099s. emily: let's talk about some of these other currencies. what do you see happening with ethereum versus bitcoin in the future? brian: they have sort of evolved down different paths. bitcoin have come down quite a bit, 50 or 60%. bitcoin is ending up being a little more like digital gold, kind of the oldest digital torency, the one people flee and times of uncertainty, but it hasn't become a payment network to paper transactions like people might want. if the rim has grown to do that and. doingng -- ethereum is more transactions per day then bitcoin. it is much more programmable than bitcoin. you can send a to b, or subtract lead to a.
ethereum is like a programming language you can run on a globally decentralized computer here at it is a mindbending concept, but it is much more programmable. emily: when it comes to the price, how do you see bitcoin versus ethereum playing out? do you see the bitcoin spike continuing? do you see ethereum surpassing like some say it will? brian: yeah. in broad strokes how i think of it, bitcoin does have a scarcity built in. if something is more scarce, the price can be driven up. if the rim has taken a different approach, which is there may be a moderate inflation curve like they may target a 2% to 3% inflation rate per year, if the rim is not gold like bitcoin is.
it is -- ethereum is not gold like bitcoin is. one broad thing you could look at is where are the users going and where are the developers building the new apps,? i see developers building more on it. today. be's --hat was going going base ceo. news, a big blow to spanish prime minister. these are live pictures from barcelona. towardsextent independence for catalonia in spain. we will be right back. this is bloomberg. ♪
emily: let's keep taking a look back on some of the biggest interviews of the year. amazon says a switch to the cloud is just beginning. i sat down with amazon's the eeo and asked if he growth of the unit has surpassed his wildest expectations. certainly grown fast and i don't think any of us would have had the audacity to predict it would grow as fast as it has, but i think we always believed it had a chance to be a significant business, and that is because just inside of amazon, we had a lot of internal development teams that want help moving fast on top of a technology platform. the fact that amazon wanted it made us think that a third party would have wanted it. i don't think we would've predicted it would be a $15 billion business growing
quickly, and i don't think we would have predicted we would have the several times the business of the next 14 providers combined or that we would have millions of active customers or a six to seven year head start. all of those things were surprises to us. emily: of course now your competitors want this, too. how do you stay in a leading position? >> it is not a surprise to us that a lot of tech companies want to replicate what we've done. fors a great value customers, that is why it is being adopted so fast. i think there are the differences between platforms. the big thing is there is a lot more functionality by a large amount and anybody else and we are also iterating at a faster clip. there are different ecosystems around these platforms. it is not just the thousands of system administrators, but most
isp providers will work on one platform. some do two, very few have the time to do three. and it all starts with aws. i think the maturity of platforms are in really here we haveces this expression internally that there is no compression out rhythm for experience. that's because you can't learn certain lessons until you get to a different -- of the scale. a lot of the competitors have not learned the lessons yet. emily: you just added ge as a customer. tell us about the length you are going through to not just get new customers, but keep the customers you have. of active millions customers. -- the best way
to think about it is we have millions who have use the platform in the last 30 days. the most big successful startups have completely built from scratch. like interest,es airbnb, robin hood, over the last three years the enterprise and public adoption has dramatically increased in the cloud and aws. you see every meaningful vertical business in aws. has, capitalp, service -- financial service capital one, manufacturing, ge. they have an -- they have been working with aws for a long time. even though we compete with them in our video business. haver public sector we
♪ >> 7:00 a.m. in hong kong and we are live from bloomberg's asian headquarters. i am yvonne man. welcome to "daybreak asia." top stories this friday, separatist have won the election in catalonia. the national prime minister's own party struggling for support. in asia-pacific market yet to try gains on wall street, u.s. equities breaking a losing streak as traders assess the tax cuts. from bloomberg global headquarters, i'm betty liu in new york where it is just after 6 p.m. nike stepping forward around the world, domestic sales have lost ground to rival adidas. eric