Considers a doordash considers a listing instead of an ipo. We will hear from qualcomm Ceo Steve Mollenkopf on the race to 5g. Climbing to a record even as the dow sank following disappointing reports from retailers. Some big tech names leading the way on nasdaq were facebook, broadcom, and tesla. Reports that u. S. And chinese negotiators may link the size of tariff rollbacks to terms set during talks in may. I went head over to new york where Bloomberg Cross asset reporter Sarah Ponczek is standing by. Are we ignoring the trade headlines . Sarah i dont know if we are completely ignoring the trade headlines, at least the good ones. That the u. S. Is softening its stance, that did engage in negative outlook. , ae a day like yesterday bureau chief from cnbc noted that the tone in china is pessimistic. They were unfortunately seeing that the u. S. Was not going to rollback those tariffs. Focused on stimulating their economy. 500 Information Technology index hit a new high, apple hit a. The bad news, as you said, does inm to be ignored, not just tech, but in the Broader Market as well. Taylor i want to show a chart in my terminal, which is apple and microsoft. Exceeding the entire market cap of the entire Consumer Staples index. Out onear of missing this massive rally. Sarah this chart is pretty unbelievable. The entire Consumer Staples and the s p made up of made up of about 30 companies or so. The other comedy combined market the combinedher, market cap. Two companies have a larger market cap than 2000 companies combined. That is a possibility through the end of the year, we see fomo pick up for some of these highflying companies. Apple up 70 this year. Some funds are doing windowdressing. We have seen some differentiation within the whole thing. Apple up about 70 . Microsoft and facebook both up 50 . Ofn you look at the likes google pair and alphabet, amazon lagging. Although it is possible that we pick up for some of these high flyers. Taylor within the idea of differentiation, bear with me as i pull in another terminal chart here which again highlights the market cap of apple more than the entire s p 500 energy sector. This is not a story about apple, to me, it highlights the concerns about growth over a dividendpaying sector, a value sector. Are we starting to see a rotation out of value into growth . Sarah if you look, yes, there are many ways you can measure value and growth, but you look at the value index, growth index. A streak of that sort since back in 2016. When it comes to tech, it is difficult. You have to see it broken into three different industries. Semiconductors, software, and hardware. What is interesting for tech, up 40 this year, the best year for the tech index at large since 2009. You see tech outperforming on days where we see cyclicals and values outperforming but also on days that we see defensive and safer areas of the market performing as well. If you were to look at the beginning of september two just before last week, that is when we did see that value outperformance, cyclical outperformance. In tech, we saw performance and hardware and semiconductors as well. Lately, we have seen that resumption of defensive outperforming like utilities, real estate, health care as well. Technology is still in the mix. I do think that this is an interesting take to be aware of just because we were talking about software coming under pressure. Taylor bloombergs Sarah Ponczek breaking down all of the market action. Toswitch gears from tech tech regulation in washington. A group of Democratic Senators want any data privacy law to include criminal penalties for violators. I want to go to washington where bloombergs ben brody has more. What kind of criminal penalties are we looking at . Ben it is a little unclear. This is a highlevel statement of principle. We have seen a proposal from democratic senator ron wyden which could send these executives to jail for knowing the willful violations of illegal duties. Toldeant to do it, you someone to do it, then it was actually against the law. A lot of prongs for that. It is something that would be hovering in the background, a sort of incentive to keep right with the law. A lot of these are rhetorically aimed at facebook ceo mark zuckerberg. A lot of democrats say that he faced these sorts of incentives, they would not have had as many problems with the fcc over the years. Taylor i wonder how democrat and republican ideas on this different. They differ quite significantly. Republicans dont like the idea of sending them to jail regularly. They dont like the idea of consumers suing to enforce privacy rights, Something Else democrats said really needs to be on the table. I think it is worth saying one orce that they largely agree have agreed over the past year, the is giving the ftc ability to find companies. For the most part, there is bipartisan agreement. Taylor to be given a criminal penalty, you would have to knowingly break the law. What are some of the issues you would have to do to get this criminal penalty . Ben it is relatively highlevel statement of principles, but you would be looking at democrats wanting to allow consumers to, say, opt out of Data Collection or datasharing within a specific company. So if you collect information to improve a product and it goes to advertising. If you have executives knowingly violating that, that is the ron wyden model, you might have a situation where the fcc comes at them and says, we have a lever over you here, you have to work with us. I think that is what the companies are worried about. Taylor we know it is never a slow day when it comes to tech, antitrust and washington, d. C. Today, you were talking about amazon,four, facebook, apple, google, pushing back. What did we learn about what those Tech Companies are saying . Ben one of the most fascinating things that i saw in these documents is amazon basically conceding that it does demote thirdparty merchants if they are offering lower prices on other retail ecommerce portals like walmart, ebay, etsy. That is something, when i talked to antitrust experts, that they say the ftc will want to dig into that and see if amazon is. Sing Pricing Power somewhat of an important admission. Thatnk it is important they say, the reason we do that is that we offer our customers the lowest prices, and there is no competition or antitrust concern. They are offering a robust defense, but i think it was an interesting concession from the company. Taylor thank you for joining us. Coming up, a lump of coal for investor stockings. The retailer gets a bad forecast despite the partnership with amazon. If you like bloomberg news, check us out on the radio, the bloomberg app, bloomberg. Com, and in the u. S. , on sirius xm. This is bloomberg. Encouraging sign for kohls heading into the retail season. Shares dropping by as much as 19 on tuesday after kohls reported thirdquarter earnings missing Sales Estimates and cutting profit forecasts for the second time this year. Our bloomberg retail reporter joins us now from new york. The whole point is the partnership with amazon. Is it not working . That is one thing that kohls is doing but what they said today was they missed on womens apparel, which is a key part of their strategy of being a department store, appealing to women. Y are also launching an launching a lot of new brands. That was some of the reasons that the ceo gave for cutting their forecast. In addition, they are part of a retail environment that is struggling. They are trying to navigate that environment. Taylor it has not been great and part of what you alluded to, having to take on the big ecommerce giants like amazon. Is this really the right time to be expanding that partnership . Jordyn kohls definitely thinks it is. They expanded the partnership earlier this year and part of the idea is that when people bring in retail returns to the coal stores, they stay around to browse a little to maybe buy some of the activewear, the home decor. Today, the kohls ceo said she is encouraged and pleased by the results she has seen so far and that could contribute to some of the operating profits. Not as manyill details as analysts might want to have about how successful that partnership is. Taylor new buyers they are trying to gain with the amazon partnership. Jordyn the amazon partnership, one thing that kohls says it brings his younger shoppers. Kohls is really focused in on the millennial mom, making sure they are offering products for the mom and the kid. They want to bring the shopper into the store, drop off the package, and hopefully stick around and realize, kohls has things for makeup, jewelry, things you might not think about kohls for. It is challenging because there are a lot of other retailers after that same customer. They have to have a value add that other places dont. Taylor any thoughts on the analyst call . Our analyst piece saying a positive catalyst for stocks could be the Digital Store fulfillment, pickup of mobile app purchases. Any sense of how digital fulfillment and those mobile store pickups could help the Company Going forward . Jordyn i think every big retailer, they are looking for the next big thing. By online, pickup and store is a big part of it buy online, pickup in store is a big part of it. There were not too many details around that but it goes along with the amazon partnership. Hopefully they get people in the store and they buy more while they are there. During thee tested holiday season. The kohlsaid ceo said it is a great test for the holidays. Taylor bloombergs jordyn holman, thank you for joining us. Now, how to head to the public market, initial Public Offering or direct listing . Most public Tech Companies are weighing their options but it looks like Unprofitable Company doordash is leaning toward the direct stock listing, and that could be coming as soon as next year. Joining us to discuss, Bloomberg Technologys candy chang. Candy one of the reasons they are considering a direct listing avoids ano is that it investor roadshow. Raisedst week, doordash 100 million from t. Rowe price. Hen i last spoke to the ceo, said the company is wellpositioned, that they have money in the bank, and that he this no hurry to spend it all. Taylor who do they join the ranks of now . Was thepotify last year First Company to use this unconventional method of going public. Slack followed and we have reported that airbnb is next in line to consider this as a way to go public next year. Taylor doordash, such a competitive, capex heavy space that they are invested in, and they have said they are not profitable. How is doordash positioned within this competitive environment . Candy a Consumer Report reported that 35 of Consumer Spending is led by doordash. They have been able to succeed by conquering the suburbs in the United States by partnership with chilis restaurants and wendys as well. Raised 2as in total billion in its lifetime, much of that in the last 18 months. And they are valued at nearly 13 billion. Taylor cash on hand, much simpler, avoid the roadshow. Bloomberg technologys candy chang, thank you. Coming, popular Vaping Company juul is being sued by new york state for allegedly breaking laws. And Bloomberg Technology is livestreaming on twitter. Check us out technology. This is bloomberg. Taylor new york is suing juul for allegedly violating state laws by targeting teenagers in its ads. The ecigarette company is also accused of misleading statements about nicotine content in its products. The lawsuit announced tuesday comes just one day after california filed a similar complaint against juul. Joining us to discuss, ellen ellen huet. Where does that leave juul . Juul is under a ton of pressure right now. The new York State Attorney general and California Attorney general, back in may, a similar suit from the attorney general of north carolina. Probes and inquiries from the ftc. The cdc. It seems like every agency you can think of that might have some connection to juul is taking action to show, we are not just going to sit idly by while we see this epidemic, as the fda has called it, of youth vaping. Taylor what is the guest concern here, the fact the guest concern here, the fact what is the biggest concern here, the fact that they were marketing to teenagers or the nicotine content . Ellen this idea that some teens or children may not know that there is nicotine in juul products, but that is a concern i have heard people discuss and that is something coming up in relation to some of the advertising that juul has done. More recently, there are also these Marketing Tactics around both using advertising that has sort of a youthful look, colorful color schemes, a young model. In one of these, the california of shipping accused products to customers that may had names that were obviously not real. One of them filled out their name as beer can. They were saying, they dont want you using their products werenteems like they putting in an effort to stop it. Taylor from the new York Attorney general, it seemed that juul took a page from big tobaccos playbook. This . S juul able to do what is it doing that big tobacco wasnt doing . Why is juul now all of a sudden in trouble. Ellen over time, they have been more regulated in terms of what you can advertise. You dont see the big the same advertisements for cigarettes as 40 years ago. That being said, people are looking at the way ahead juul the way that juul has employed some of the same tactics that tobacco did years ago such as going into schools and doing Education Programs about addiction and ends like that, but then being sponsored by juul. Hasor for their part, juul come out and said they are continuing to be committed to resetting the vapor category. I wonder, from a business standpoint, they had a partnership with altria, but the all triaphilip moore but the morris deal has been called off. Ellen i have been sensing that they have been trying to put their public message, we really want to be compliant, careful, we want to earn back the trust of american consumers. This has been an interesting pattern. You mentioned the vaping deaths have been a big part of the headline. Theairness to juul, many of vaping deaths have been related e thc vapes that have vitamin and other additives that juul says is not present in their products. They are getting a lot of heat because they are the biggest ecigarette company. Taylor bloombergs ellen huet, thank you for joining us. Qualcomms ceo says it is important for the u. S. And china to Work Together to make 5g an international standard. This is bloomberg. Whether youre out here on lte. Or here on a wifi hotspot. Xfinity mobile has more coverage to keep you connected to what matters most. Thats because its the only Wireless Network that automatically connects you to millions of secure wifi hotspots and the best lte everywhere else. And now get 250 off when you buy a new Samsung Phone during Xfinity Mobile beyond black friday. Plus, you can save up to 400 a year. Click, call or visit a store today. Taylor welcome back to Bloomberg Technology. Im taylor riggs in san francisco. Lets get a look at todays top tech calls. Disney up to 100 75 a share. The analyst cited faster than for disneygn ups plus streaming. An internal survey suggest high awareness of disney plus and that a High Percentage of users will stay on the service after a one week free trial. Shares of at t fail after being downgraded with the 30 price target. One analyst finds it hard to imagine the recently updated for your guidance can be achieved. Intel raised their price target to 65 a share on their Pricing Power. The endless said intel was getting aggressive on cutting prices and that could position intel to aggressively compete. Aftery Rating Increased announcing a new graphics processing unit. Thats a look at your top tech calls. Qualcomm has been front and center in the development of 5g networks including a partnership with apple and some of chinas Biggest Telecom companies. A ceo set down with Caroline Hyde to discuss his views on apple and how china is doing in the 5g race. Is focused on the things the companies naturally do well together, which is work on products. When you get engineers talking to engineers, things work out pretty well, and thats where we are today. Caroline so the 5g relationship will mean more for you, do you think . If you look at what 30,000 people do everyday, its work on products. When they engage with the partner, whoever that would be, thats a very natural relationship for us. Everyone is so interested in driving 5g, and there is a long roadmap to do that. Theres a lot of natural discussions going on in the product area and thats a comfortable place for both companies to be in. Caroline what about the discomfort in the fact that they bought the intel modem part of the company . How long do the do you think the partnership at last . We think a long time. Were not accustomed to dealing not unaccustomed to dealing with these partners. What we find is if we are competing in the areas we are very good at, and we are certainly very good at the modem, we would figure out a way to continue to expand our business. That has been true for a decade plus for us and i dont think it will be any different here. Caroline what about the competition coming from china, and huawei becoming more selfsufficient . You have a relationship with huawei how is that relationship and with the partners in china at the moment . Steve its driven by the same things were talking about at the moment. 5g and the worldwide expansion of the opportunity of cellular. We have a very strong business in china, a lot of partners, including huawei, and it continues to be a big opportunity and a big business for us. I would say in some ways, it has we are insulated from some of the trade discussions. Theres a lot of expansion happening worldwide with 5g in china. Qualcomm is a big piece of that. Its a classic story of if you have technology that people want or need and you are the strongest partner or a strong partner, you have the ability to figure out ways you can winwin. That has certainly been the case for us. Weve had a little bit of a change in the structure of the chinese market, as the Huawei Business has retrenched into china. Bit,s changed the share of and what people have done in reaction is they have said going to accelerate my 5g plants and not spend so much time on 4g. So what has really happened is it has accelerated the intensity of the 5g rollout, and not just at the highend. It has come down into several tiers below the premium tier, we are spending a lot of time getting the chinese partners successful. Caroline do you think china is ahead of the u. S. On 5g . Steve not from the technology perspective. Were all working together to make 5g an international standard. Otherwise you miss the opportunity worldwide. You are not seeing that. Youre seeing people cooperate in terms of the technology. But if you look at deployment, the speed at which base stations are rolling out, china is growing quite fast. I made some comments about 130,000 base stations by the end of the year and a million in china alone next your. Those are tremendously large numbers if you put it in comparison with what you see in the u. S. , that doesnt mean the u. S. Isnt growing quickly as well. The first time in cellular youre seeing china and the u. S. Launching in the same calendar year. They used to be separated by two years or five years. Now everyone worldwide is trying to figure out how to get to 5g quickly. Those whowhat about have had years of negative revenue in terms of growth, is 2020 the turning point . Steve we think it will be a good year for the topline and bottomline, really driven by 5g. A lot of things people know about our business, they will see happen throughout the year. We are pleased to have that opportunity. Caroline what do we know about your business . Steve its the opportunity we handset space. E we need to have a tremendous Technology Pipeline as a result of being strong in the smartphone space. That technology is valuable for us to disrupt these Big Industries that are being disrupted by 5g. Opportunity to have to figure out how we leverage that Technology Pipeline into these new industries. I think as people learn about that and they see what we see, they will be very excited about it. Caroline what about the share price . Steve were very happy where it is. You need to always Pay Attention of the fundamentals of how the business continues to grow. It is reflected in the share price but sometimes its not. We finished a large buyback, one of the largest in corporate history, we bought back 20 plus percent of our shares because we thought they were undervalued. It seems like that will turn out to be a good investment. We keep driving 5g and we hope it will be reflected in the share price. That was the qualcomm ceo. Oracle has delayed its decision to replace its ceo mark hurd, who died last month after taking a short medical leave. Oracle Succession Plan is to lead control in the hands of chairman larry ellison. Ellison has put forth five candidates but none have emerged as the frontrunner. Coming up, from competition in the cloud to competition in gaming, google is looking to take the number one spot. Well discuss how google plans to take on gaming consoles by switching to the cloud. Thats next. This is bloomberg. Taylor google is taking over a chunk of vodafone state operations to help the world secondbiggest mobile phone company identify cost savings using artificial intelligence. Vodafone will shift out of processing and storage from its own premises to google cloud. This comes as google continues to compete with both amazon and microsoft for dominance in data centers and cloud computing. Joining us to discuss is alistair barr. Amazon is the leader in the cloud and microsoft is second. Google is a relatively distant what theyre good at pioneering is ai. Theyve used ai for a lot of other things in the past but they have turned that technology into service over the cloud and over theen productized last two years. The vodafone deal is a good of getting access to the ai and one of the ways they can do it is by renting it to Cloud Service for google. Taylor you mentioned that google was a relatively distant third. Does this move the needle . Alistair if they keep doing deals like this, it could begin to move the needle. They have a massive amount of data and they have huge data centers for other purposes. So it is a very big deal. Maybe 20 more of these deals and they might start to catch up. Taylor how are they getting these deals over at amazon or microsoft . Withair they started different ways of pricing which made a lot of processes running in their data centers cheaper. Most cloud users are not necessarily looking for call for cost savings, theyre looking for other benefits like scalability and things like that. If you want to be a real competitor with amazon especially, you need a broad offering of Different Things that have to work with a lot of different software. So ai has to fit into a much broader strategy. Taylor and you said along the lines this week, they need another acquisition within the Cloud Company of cloud simple. So you have to find more deals to keep up. Right, andhats cloud simple is really quite complex. Its a classic example of what google needs to do since that company serves big Enterprise Companies and they have data in their own data centers which they manage in a quite traditional way. They want to move some of that data to the Cloud Service, it could be amazon or google, and cloud simple handles all that. So they have enterprise customers that google really lacks right now. So when they do a deal like that, theyre not only buying that technology but the customer as well. Taylor i wonder if all these deals antagonize lawmakers and regulators who have been talking about antitrust . Alistair i dont think the cloud simple deal was huge, but there was another one that was well over 2 million. And then there is the fitbit one which isnt really in the cloud but it was about 2 million. Alistair barr, thanks for joining us. Sticking with google, the company has finally launched its longawaited cloud gaming service. It allows users to stream and play games via smartphone and web browser, ditching the old clunky console. Some are calling at the netflix of gaming. Others are not totally sold yet. I want to bring in arcadia president kenny rosenblatt. The company has developed over 100 titles across pcs and browsers and mobile devices. Was it successful . Is a longterm play for google. Coming right out of the gate, there are a lot of naysayers out there, but on the positive side, it is a very advanced technical solution. But Technical Solutions dont sell game consoles. What sells game consoles or games. The lineup that stadia came out with leaves a lot to be desired. Taylor so what do you want to see from the game lineup, given your history in that space, to help boost the appeal . Kenny you need exclusivity. You need games that are exclusive to the platform. If you think nintendo coming think about mario and luigi. Microsoft, you think about halo. What is stadias exclusive content that will make users and players want to come to that platform . Games at they have 22 launch that you can play just about anywhere else. Taylor i was reading some of the reviews online and they are not entirely positive. I wonder what inning you think we are in, if this is a nine inning series, or we really just in the early stages . Kenny stadia should talk to their friends at microsoft and asked them about their entrance into the Gaming Market. It needs to be a longterm play for google. Were talking 10 plus years, not just because of the technology option that needs to occur, but they need to get their feet wet in developing content. Nobody thinks of google as a content company. They really need to forge relationships with developers. They need to really understand what it means to foster a Gaming Community and they need to build on this. This is not like a 10 year plus commitment if it is not a 10 plus commitment, then they are just throwing their hat in the ring. Taylor how do they differentiate themselves with their target audience kenny one of the problems is, they dont know what their target audience is. They are trying to be everything to everyone, and its just confusing. A lot of people are saying it is the netflix for games. In netflix, you dont actually pay for the games are going to watch. In stadia, you have a subscription and then you have to pay for something. We are sending a confusing message to the market, which is why a lot of people have a waitandsee attitude. Taylor i am not a gamer just yet, so describe to me how big this Market Segment is. What is the potential that google sees . Kenny what i love about googles move is that the Gaming Market is over 150 billion worldwide. It is bigger than television and movies combined. I like that they are going after a really large market, but they have to stick with it for years to come. Additionally, this is a market that is growing. Theres mobile devices in everybodys pocket. Market has grown over 9 just from last year. So they are on the right trend, they just have to stick it out. Taylor who is the next competitor . Kenny amazon is definitely going to run into this space. With the acquisition of twitch, that showcased the excitement about the market. Here, so has long been there is a lot of cloud Gaming Companies out there that have deep roots in gaming that i think have a really good shot of taking a large percentage of this market share, but the race is on. Lets see what happens. Taylor i like that. Thats kenny rosenblatt, thanks for joining me. We are getting an idea of what alibaba shares are expected to start trading at. The chinese ecommerce giant has set share price is around 176 hong kong dollars to be trading is expected to begin next week. Goes ahead, warby parker daily. They want to bring contact lenses directly to you. We will have the details next. This is bloomberg. Entrepreneurs the they werees olympic growers. The company they bought lets people buy Digital Collectibles with the credit card. Terms of the deal were not disclosed. Can you make contact lenses cool . Thats what warby parker is hoping for. They are one of the pioneers of the direct to consumer craze. Theyre hoping for hundred 40 a year daily contacts will be as appealing to shoppers as the ceo hopes. Were super excited to introduce the daily contact lens at a much better price point than you can find elsewhere in the market. It is really the first opportunity for contact lens wearers that have been wearing or monthlyere, to lenses, the first opportunity to enter into an affordable daily contact lens. Taylor i want to bring in austen car who has written about this and this weeks edition of bloomberg businessweek. It seems like a seamless vertical strategy from glasses to contact lenses. Thats correct. There was a big question about what would warby parker do next . They pioneered the direct to consumer products. There have been a lot of knockoffs. There was a big question if they would spread into other product , whichls or double down is what they have done. Taylor what is it about the company, is it the marketing, the seamless website, the coolness factor . How is the company able to just get it done . Its almost impossible to describe. Intangiblet these Customer Experiences that just transform it from a transaction to a more emotional experience. That might work with glasses, which are a trendy fashion item, it becomes a part of your identity. The ones i am wearing are warby parker. Can have thethey same impact with customers and retail shops when it comes to contacts, which are an invisible commodity. Its really a piece of plastic that you put on your eye. Thatarby parker convey same brand affinity for something that just disappears on your face . Taylor and so much of that ran revolves around the marketing campaign. What is the Current Marketing or advertising plan, and does that change with contacts . It definitely does. Shop, itsnto their very bespoke and fun to try on. They have an online experience where you get five pairs at home to try for free and just pay for the ones you like and send the others back to warby parker. A doctor forto see prescription before you get contacts. Its more about custom fit. Theyve hard more optometrist on rooms,nd built out exam exam suites in their stores to simplify the experience, so people can get there prescription at the same time they meet with their eye doctor. They want to simplify the process to make it less dull than going to your traditional eye doctor. Taylor how much of a Regulatory Burden is this . I was surprised to read that contacts have the same oversight as hearing aids or pregnancy kits. Its a significant more challenge, as they move more into telemedicine. The idea that you can update your prescription just by phone at home. You can do a vision test on your laptop and verify with your phone and submit it online to a warby parker doctor who can verify it. The optometry community is a little concerned about the technology and where it is heading. Warby parker now just uses it for glasses, but they hope to bring it to contacts. Weve seen other eyewear makers it into trouble for doing that with customers. There has been talk of infections and things like that. The big challenge will be whether they can streamline and do it safely. Thats what theyre trying to do with this launch. Ease, where are they at with those at home i tests . Could you repeat that . Taylor where are they on the convenience with the at home i tests . They want to bring more shoppers through the door which is why theyre bringing more doctors into their stores as well, to make it and into in Retail Experience that spans into the medical space as well. Taylor austin car, handling that curveball i just threw him very well. That does it for this edition of Bloomberg Technology. Twitter,vestreaming on and be sure to follow our global breaking news network at tictoc on twitter. This is bloomberg. When it comes to using data, everyone is different. Which is why Xfinity Mobile is a different kind of Wireless Network that lets you design your own data. Choose unlimited, shared data, or mix lines of each and switch any line, anytime. Giving you more choice and control compared to other top wireless carriers. And now get 250 off when you buy a new Samsung Phone during Xfinity Mobile beyond black friday. Plus, you can save up to 400 a year. Click, call or visit a store today. Good morning we are under one hour away from the market opening. Im kathleen hays. Close welcome to daybreak asia. Our top story this wednesday, the senate moves to support hong kongs protesters seeking annual reviews and sanctions for those undermining freedoms