Motorola unveil a that. We will take a close look at these devices ahead. There seems to be no end in sight to concerns over the coronavirus. The death toll continued to jump after the epicenter revised a method. Thousands of passengers have been quarantined on a cruise ship in yokohama. Demand dropped this quarter for the first time in more than a decade. For market reaction, paul allen and i spoke with victoria hernandez, chief Market Strategist at Global Market investment. We are watching the headline to see what is driving the market. One of the things we tell our clients is that we want to look through the headlines when it comes to investment and strategy. We want to take a longterm approach. Yes, theook day today, virus has caused volatility in the market. We saw that this morning when they reported the higher cases of virus in china. I think we have to look at it a little bit. The market came back and gained 50 what they lost. A lot of that because the increasing cases was due to a change in methodology and how they were calculating the cases. It included a lot of people who already had the virus. It was not all new cases. Originally, we had a selloff and saw that come back throughout the day. Yes, coronavirus is driving the headlines now. It is battling with some of the fundamental things, earnings, and strong economic reports we are seeing. See small caps bounce today which reversed the trend. What is your theory on that . We know that small caps have a more domestic feel. If a lot of the downside we are seeing in the market is coming from the coronavirus care and uncertainty outside of the u. S. , we can see where small caps are starting to do better because they do not have the same concerns. We will have to see. One day does not make a trend. We will have to wait and see how those things continue over the next couple of weeks. Kayla that was victoria fernandez. The coronavirus is starting to reverberate into the global tech space. Chinesebased manufacturers have begun reopening factories after temporarily closing them but no one knows how deep disruption goes for a tech Company Including apple, samsung, and tesla. Bloomberg Senior Executive spoke with Romaine Bostick. A lot of confusion and uncertainty. The benchmark people look to is the sars epidemic so much has changed since then. It is a more globalized tech industry. China, at the center of consumption, has ramped up considerably. It is responsible for 35 of all Semi Conductor sales. A lot has changed. We know the coronavirus has eclipsed sars in terms of infection and deaths. As you said, a lot of factors are welcoming back some employees after the lunar new year. Foxconn chairman and they told workers of the unit that produces the iphone for apple to not come in. They are clearly worried of the nightmare scenario of an outbreak in one of the manufacturing facilities. I think we are going to see people coming back to work much more gradually than they anticipated. Conn grading must iphones, what are we going to see float over . The one spot of good news is that this is a soft period of the year at least outside of china in terms of consumption. The upgrade cycle is in the fall. The Holiday Shopping season is the big time of year for the Tech Companies. There is a good chance that even if they do slowly ramp up into production, they can make up the shortfall later in the year. We got an email the chairman of foxconn who said he was lowering 1 imates for the year to a to 3 growth. You see companies being cautious in terms of projecting with this means. Foxconn is a great bellwether. Look, there is going to be a hit nobody knows how big what will be. Be on that, we saw statements out of tesla that they were prepared to restart production as planned. Sony also making similar comments. At the same time, we are hearing some of these companies are not going to participate in a conference taking place in spain. A big mobile conference. What is the general sense . Can they get back up to business as normal quickly . Are they willing to do that . Is this just going to drag out . I think will drag out for the foreseeable future. It is a wait and see and following the facts on the ground. Some indications say might be peaking. Some of these companies are looking at it carefully. Ofis easy to pull out barcelona. It is an important conference for the year but the safety of your employees and preventing any unnecessary infections is paramount. Every company is looking at this to see how it plays out. I just want to mention a practicality factor where we have workers coming back from holiday in china and facing transportation blockades, quarantines. It is impossible for them to get back to work. Kayla that was bloombergs brad stone. We just heard several bigname Companies Announced they were pulling out of the mobile world congress. Wednesday, organizer scrapped the event entirely. In a statement they said the global concern regarding the coronavirus outbreak, and other circumstances, make it impossible to hold the event. My colleague paul allen deny spoke about i implications to the companies involved. It is significant in the sense it will have an Economic Impact on the city of barcelona which is everything it can to support the conference. The city becomes the conference for that week. It is going to put a delay, for halt, on a lot of business meetings and potential deals between carriers and suppliers. At the end of the day, this overall impact on technology besides a small financial headwind is not going to be significant. Thankfully, we are in the year 2020 and these things can be rescheduled whether another place or videoconference. What were we expecting from the conference . We were expecting a lot of hoopla around 5g and the back room deals. From a consumer perspective, i know motorola was set to announce a slew of new 5g phones. If you other companies were going to announce new phones. None of the major giant. You are not going to see anything new from apple, samsung, but the big players who talk about. We are not missing out on those. We are in the time were lots of Tech Companies like to make big announcements on their own timelines. Opportunityive an to give important people in the same place talking about development. Is this going to have implications for things like 5g rollout or other deals . Yeah, deals certainly of any major importance are going to be rescheduled. I feel like if there was any missioncritical meetings, it would have happened already. I know personally if i really need to meet with someone to get something done, that is going to happen asap instead of at a to be scheduled conference. Qualcomm had a major meeting scheduled, they could have just done over the phone or met separately. I think that is more fantasy than reality. Kayla that was bloombergs mark gurman. Plenty more still to come including breaking up a tech. Regulators are demanding companies turnover data on their acquisitions both big and small. That is next. If you like bloomberg news, check us out on the radio. You can listen on the bloomberg app, bloomberg. Com, and in the u. S. On sirius xm. This is bloomberg. Taylor the u. S. Federal trade Commission Wants to know more about big tech and some acquisitions. Specifically ones that may have eliminated emerging competitors. Ftc told Large Companies to provide information about deals that were not reported to antitrust agencies. The companies include alphabet, amazon, apple, facebook and microsoft. We discussed this with Senior Analyst for internet and media, michael levine. It is probably facebook for the top of the list. I am looking at that in conjunction with hearing they were going to seek an injunction toward the end of last year trying to stop facebook from time to messaging platforms. If you think about, where that to be the case we had written a know about this at the end of the year there would be more revenue disenergy. What acquisitions would we be talking about . Are talking about whatsapp, instagram . I think that is it. Those are the ones. What are the implications . Ftc is one the thing. And antitrust action is another. What is the reality of real action . Even if they bring a case, it would take years in the court to play its way through. We obviously have gotten more negative on the stock on the basis of fundamental work we have been doing combined with a disappointing q4 and outlook 4 for the year. One of the things that have kept us on the sidelines in regards to multiple and that will be in overhang. Right on the fundamentals, you will see the multiples grind lower. Michael, is it possible there is nothing to see here . More broadly, is Regulatory Risk come with the territory of investing nowadays . I think there is something to say. There is clear dominance in the social space and one of the things that has been so remarkable about facebook is the ability to leverage data across different platforms. They are the most mop in the monopolistic. We are positive on google. I dont want to brush under the cover i think you would have issues around the doubleclick unit. We have also been reading between the lines and you saw chapter a couple of weeks ago chatter a couple of weeks ago that it may be used in our opinion is a way of appeasing the regulators. We think that would be a pretty big win. Taylor that was Pivotal ResearchSenior Analyst michael levine. Haveile and sprint emerging for two years. This week they got a step closer to reaching the finish line. The two Companies Said they expect a close as soon as april 1. We got reaction with Senior Analyst jennifer reed. I think this was a surprise particularly amongst the antitrust lawyers and analysts who had been looking at the case. It was an unusual decision. Rather than taking each of the companys defenses to an anticompetitive deal, based on combined market share and what we call the hhi index which is used to assess a deal, the defense no defense on its own met the test that was set forth in the department of justices guidelines. What this judge said was if you take them all and put them together, take in together they rebut this presumption that it is anticompetitive. The judge accepted the remedy that the department of justice imposed to divest assets to dish and set them up to be a competitor in the market. Who needed this deal more sprint or tmobile . Taylor absolutely sprint. Tmobile would have been able to go ahead and continue with a profitable path. It may have been more difficult as it needed what sprint had but sprint was in a difficult spot. They had reputational problems, network problems, debt. They were really in a position where especially 5g they were not going to get themselves to a point where they could compete with the other three, verizon, at t and mobile. I definitely think sprint is the winner. I just wanted to build on taylors question. They have had a wretched year. At think this was really needed, this deal. They should thank john legere for this deal. I have to say some of the genius and the force of his personality definitely came through and how the judge assessed evidence. The judge decided that the maverick and carrier strategy and the Corporate Culture john built into tmobile was going to continue even when it was a Larger Company combined with sprint. Was really lucky in this decision given what they have been going through. Of the visionms softbanky are urging to buy back and improve transparency. Does the completion of the deal make it known some of that will happen . I would think so. It is straining a little bit out of my area but yes, i would think so. It looks like the completion of the deal will put things in place for softbank. Taylor that was jennifer reed. Came out theft results that beat expectations. We will dive into the numbers next. This is bloomberg. Taylor lyft came out with results narrowly beating analyst estimates. It was not enough to impress investors. The company said it could not promise profit sooner. We broke down the numbers with eric newcomer. You ever had the advantage of having earnings first and got the surprise investors by moving up its profitability . I want to be clear, we are talking about the adjusted profitability. It cut out a lot of things. The stock these companies are spending they are spending a ton of money. Lyft is still growing. They got to 1 billion in revenue in the quarter. They have the disadvantage of being smaller and uber has had more time to become a huge business and start earning the levers to try make a profit. Uber is focused on business customers which could help it get to profitability. Does not wantlyft to commit to the same timeline. Taylor i think you hit it spot on when he said the profitability is adjusted. It is not down to net income on the bottom line. Two analysts care it is supposed to be easy profitability . You take out the other expenses not yet being included. At some level it is shocking to be talking about uber getting profitability this year when we look at 2019 losses. It was something above a billion dollars on a net income basis because they have 4 billion and other expenses. Uber is a company that loses a ton of money but the reason we focus on the even numbers is it gives analysts and investors somehow to get their head around how the Company Makes money. The framework the markets are paying attention to. That is what we have been talking about. It is important to remember there have been huge stock expenses and other expenses that will be a problem for these companies. Eric, part of the problem is that the market is saturated. You cannot encourage consumers to take more rides. Start looking at ways to make money . They have been growing into a market bigger than the company. You are seeing a growing to active riders which is a good sign. Call, you heard they were going to face the law of large numbers. They were just going to run into the top size of the ride market. Uber has gone into food and other industries in the way lyft has not. Lyfts message has been they are not going to veer from that. It seems like they need to show they can run a profitable ridehailing business and make it work as a smaller company. How about on the cost side . Jobs. Aid it will cut 90 is this just the start . Corporate jobs matter. Certainly symbolically but at the end of the day what matters here is price competition and how uber and lyft are digging into prices to gain ground relative to each other. I think that is why the stocks have traded and have been related to each other. Investors react to one announcement for the other because there has been a price war going on. Be peak loss. Ould that has the competitive dynamics. But the big question is if subsidies come down, what is the Addressable Market for ridehailing . Does that limit the number of people who will take a ride . Taylor that was eric newcomer. Simpson unveiled its latest device in San Francisco this week. It is a foldable phone the y zpany named the galaxie flip. It is smaller in price and size. It is a signal that samsung is committed to developing a global business. Also i with the new offer motorola. We got our hands on the new razor. This is the new motorola razor. 1500 razorrolas reboot. Remember the razor from 15 years ago that everyone had . Instead of being a normal flip phone it has a full touchscreen. It is a smartphone. This phone has plenty to like. It is minimalistic, it has hightech features all modern smartphones have but there are drawbacks. The technology is still super early. You can feel bumps and lumps in the electronics as you rub your finger across it. There is a notable soul sound when you open and close the phone. The hinge mechanism opening and closing. Even though it is 1500, it does not feel super reliable. This could work for six months or a year. Longterm we will see how long it goes. It easilyy to make accessible, the nostalgia, but the drawbacks just being a period where it is more accessible to pull it out versus needing to open and shut the display. The cameras are behind the time because of the thinness of the mechanism. The hinge makes the noise and you can feel the electronics. We will have to see this in longterm. At this point, it is very cool. I dont think the technology is quite there yet especially for 1500 but we will see where the future goes. Taylor that was mark gurman. An unlikely duo. Making changes by activist investor paul singer. Bloomberg technology is trimming on twitter. Check us out at technology and follow our global breaking news onwork at quick take twitter. This is bloomberg. Sometimes your small screen is your big screen. And with the Xfinity Stream app, which is free with your service, you can take a spin through on demand shows, or stream live tv. Download your dvrd shows and movies on the fly. Even record from right where you are. Whether youre travelling around the country or around the house, keep what you watch with you. Download the Xfinity Stream app and watch all the shows you love. Welcome back to the best of bloomberg technology. I am taylor riggs in for emily chang. We had more tech earnings out including alibaba on thursday. While revenue beat estimates, the cfo said revenue and growth for the Current Quarter will be negatively impacted by the coronavirus. The epidemic has already caused significant delivery delays for the chinese tech giant. Paul allen and i spoke with john freeman. My takeaways were that it was a pretty good quarter. In terms of revenue growth, it was higherthanexpected at 38 . User growth was particularly impressive. 60 of the new users coming from the rural areas. There were a couple of hundred more users that could join their. Re. The story is really about the coronavirus and what that is going to do to Overall Economic growth. To whatng to degree that will impact their revenue and earnings going forward. Harry, i wouldt, like to bring you in. Willng forward, maggie saying the overall revenue will be negatively impacted. How negatively . They did say negatively impacted. Probably low to mid single digits. The main reason as to why revenue is impacted is first, they are seeing a lot of supply dislocation. Movement ofot of goods and people being difficult. Second, there supporting the infrastructure in terms of remedial effects. Theyre providing medicine at a fair cost. Theyre providing Logistics Services and food for the doctors and hospitals. Third, there helping the ecosystem by producing the platform fees, providing discount and logistic fees. Building theare ecosystem and more importantly, one thing we walked away with, consumers are beginning to trust the Digital Services more. As you know, movement of goods and people is severely curtailed. Servicesly digital which i think bodes well for the longterm growth of alibaba. Havey, the data point we from the sars virus, we think this epidemic will be cured and we will see a spike in growth over the long term. You have to go through a shortterm but be positive on the longterm. Some of the changes championed by paul singer. This after the Japanese Company reported a Second Quarter of losses from startup investing. Matt months joined Romaine Bostick and scarlet fu. Things sound amicable. Use plain lipservice to what singer wants. Governance, and corporate changes, he nodded to the fact we might address and improve these. He is saying the right things elliott wants to hear and saying it in a favorable tone. Describe singer as an important partner. He described himself as the largest shareholder in softbank. They are naturally on the same page. Masa did not say he would do the same thing which is the 20 billion buyback. Do you think what he did was enough to ease some of those tensions between investors in the firm . We are in the early stages. They move at their own cadence. Ago and heoke a week did that because earnings were coming out. It is going to take several weeks for them to continue engaging. Was it enough today . I dont know if we will see that particularly on buybacks. They said they are open to the idea of buybacks but the time and size of that will depend. He also said in terms of transparency, we are open to having transparency in the deficient fund but then what disclose the value of the private companies because covered in jollity agreements. My take away is that Masayoshi Son is going to do what he wants to do. Feared activist shareholder. Has been able to work out deals with the companys it targeted . Does it always tend to get adversarial . How is he described . They called him the boss who tells bosses what to do. When he puts his weight behind something, he often gets his way. I suspect things are amicable and you will get a board seat or two. It will be another win for him. Up, mike rogers a former chairman joins us to discuss how he things the u. S. Human the global race to deploy 5g. Ceo to rings and a new turn itself around. This is bloomberg. Taylor the Trump Administration wants to develop a cohesive 5g policy but there has been widespread disagreement about how to get there. Last week, william barr dismissed a white house led effort to build 5g using homegrown equipment. He said the government should work with nokia or ericsson to counter the threat of huawei dominating the next generation network. Rogers. With mike to Chinese Companies act by the government are not dominating the market. China wants data dominance by 2025. In order to compost that, they understand the need for building out networks. The government of china has invested in rnd which is Government Investment as well as financing deals. Zero down, zero payment for three years and we cover the buildout and engineers. No western company can compete. We should be asking ourselves, why do they want to do that . It is really to control data as it moves through the network. Taylor should we be investing in our companies the way beijing has been investing in their 5g . William barr had an interesting take on it. Sure nokia and ericsson we want them to compete. We want them to win contracts. I would do it a different way versus the government tried to get 20 billion to buy a company headquartered in finland. Could we not help them on the grants to overcome the massive Chinese Investment . Second, how about financing deals . Low interest loans, pay back loans, zero interest loans that would allow them to compete against Companies Like huawei around the world . To me, that is a better way to get the money back and make sure we have western valued telecommunications companies. Taylor how concerned argued that the u. K. Did not ban huawei . I think that is a terrible decision. Parliament is going to get a weigh in on this. One of the things this allows is huawei there is a crazy notion that they can protect the core but all the Edge Computing 5g is but Edge Computing. That is how your ability to commune quickly is going to happen. I dont know anyone that believes that is possible. What it means is that is going to change the way the Intelligence Services at the United States share with our greatest partner Great Britain we share more with them than any other nation. Even the other five partners. That is going to change. Not only that, you have given china the ability to turn off things when there is a disagreement. Why would you want any foreign adversary to have that capability, that leverage, anywhere in your network . You cannot keep them out. Theres an old saying in the intelligence business it is not where you get into a network, it is how you move once you are inside. That lateral movement. Once youre in the network anywhere in the country, they can move around to places you do not want the chinese intelligence to move. Taylor that was mike rogers. Work hasnt been new ceo. She tooktate veteran ggp out of bankruptcy in 2010. He was also ceo of Brookfield Property partners. After failing to go public in september, we work has been remaking its Management Team and added its first woman to the board. I spoke about the new strategy with da davidsons Senior Analyst, barry oxford. I wrote reports about we work and how they struggled with the company. I feel this is one of their positive moves. They have been through a couple of ceo changes but i think you hit the nail on the head when they have a real estate person. This is a Real Estate Company but not a tech company with a real estate event. This is real estate first. I think sandeep is the person to lead the company as far as getting them to profitability. Taylor what can you glean from sandeeps previous work in turning around some real estate companies, pulling them out of bankruptcy, that you can glean forward into future work he could do at wework . Sunday being the ceo of a being company sandeep the ceo of a public company, he is the person to lead this company. Eventt think it is a 2020 but i think sandeep is the person to bring the company public. He has the reputation and credibility with investors and i think softbank has funded enough money from wework that they can complete what is needed to be done already in the pipeline as far as lisas being sent leases being signed. Day is his first february 18. What should be his number one job on day one . Is it getting out of unprofitable businesses . Is it focusing on the ipo . What would you like to see him do . Ipo has got to be fifth or sixth on his list. The first is getting out of the extraneous businesses that adam got into. Ind those taylor this is bloomberg. Taylor sevenyearold maverick has a rare genetic disorder that limits his vision. Scientist and gene therapy had developed a medication that has the potential to improve his site sight. Genes effects of retinal cause a devastating form of childhood blindness. Gene therapy is at the forefront of treating retinal degeneration. There are over 20 Clinical Trials addressing various diseases and ways we did not think possible before. Having to make a decision on his behalf has been a real struggle. This treatment could change our lives. This could stop a truly terrible disease. As we tackle the problem of childhood blindness, this is going to be a breakthrough in our ability to change the course of the disease and a way we never thought possible. Maverick is my firstborn child. He has been the most amazing child to raise from the day he was born. I did not have a lot of expense with babies before i had him. I noticed he had a blank stare. I checked his tracking vision and it was nonexistent. We went through the genetic testing and it came back positive for libor scandal ebers amarosis. The eyes do not allow for light perception. He is legally blind with specifically lowlight blindness. He also does not have peripheral version or vision below his waist. It is almost tunnel vision. I need a pair shoes. Help me. [laughter] room and thesey this is my eyepatch. It has to be the right lighting for him to see. Once the sun goes down, his world is very dark. We take them inside, turn on all of the lights until it is time. Or bed mavericks condition is degenerative. There is no timeframe of when the degeneration will take place he it is a wellknown fact will be completely blind in later years. A torched landscape. In december 2017, the fda approved gene therapy for mavericks specific condition. We went and talked to dr. Naegele shortly after was approved. Maverick was six years old when i met him and the family, for a long time, struggled with getting a diagnosis. We are very excited to hear there was a treatment. We deliver a healthy copy of the rp 65 gene. Virus whichion is a has been modified so its only job is to deliver the genetic material. We deliver this virus with a very fine needle underneath the retina. Then we have a healthy copy of the gene that has been missing in the cells that normally make it. Disease,tely with this the cells that absorb the light are constantly generating degenerating. There will come a time when they will just cease to function. Even if we were to deliver the gene. It makes sense to treat earlier. When young patients have the normal cells and just need the copy, make it function again so treatment is the way to go. At the Childrens Hospital los angeles we have treated 17 patients. We have data the treatment is stable without any loss in function. Five years ago, there were no treatments for this disease and for the bulk of retinal degeneration these patients if they were lucky got a diagnosis but beyond that, there was not much we could do aside from getting the most of the vision they have. Since the fda approval that has opened the door to not just treating this relatively rare degeneration but any retinal degeneration. This has been probably the most difficult decision i have ever had to make in my entire life. It makes me very nervous because it is so new. It does not go well, it will be my fault because i chose to do this to my child. I honestly feel like i hit the jackpot when i had maverick. I dont know any other sevenyearold kid that could handle everything he has been through with such appreciation for life. He is willing to do or try anything. After today, our lives could potentially change forever. I love you. I love you, buddy. He may go back home and for the first time have fun with his friends by the pool after dark. Right his bike at desk, go trickortreating, these are the improvements that change a childs life. The confidence that comes with interacting with the environment in a way that could not before really has lifelong consequences. It takes seven days for the corrected dna to be absorbed. At seven days, he could potentially see again. It just comes in very small doses and it could take up to four months they said. Had his two surgeries and we are home. The first day that i really noticed something was different was riding in the car and he said mom, i am just looking outside and i am seeing what is outside the windows. I have never been able to see through the windows. It seemed small but it was lifechanging for him to be able to look out of a window. Ready . Listen to me. One more game of tag. Coming you e [laughter] in the past seven years, we dont come in the backyard at night. This is a true miracle. You cannot stop me. I got maverick. Illow, come here and get him conquer anything given to him. Taylor that is part of prognosis our series on the future of health and the business of health care. For more, to bloomberg. Com and follow bloomberg tv by using the terminal function tv. That does it for this edition of the best of bloomberg technology. We will bring you the latest in tech throughout the week. Tune in each day at 5 p. M. New york and to be in San Francisco. Bloomberg technology is livestreaming on twitter. Tech is at a technology and be sure to follow our global breaking news network at quick take on twitter. This is bloomberg. Jason welcome to bloomberg businessweek. I am jason kelly here at bloomberg headquarters in new york city. This week, as coronavirus spreads we measure it strain on chinas debt heavy financial system. A huge fan of trumps steel tariffs, he is now suing over them