a separate one dollar trillion spending bill -- $1 trillion spending bill. the house freedom caucus is backing the latest health care proposal to repeal obamacare. the hard-line members who helped scuttle the earlier bill announced their support. the top ranking democrat on the senate foreign relations committee says president trump's deployment of military assets to north korea, quote, "just heightens the temperature." senator ben cardin says the u.s. needs a strategy to change north korea's calculus on its economy and security. global news, 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. i'm alisa parenti. this is bloomberg. caroline: i'm caroline hyde. this is "bloomberg technology." coming up, the trump administration unveils, quote, "the biggest tax cut in u.s. history." but what's in it for tech? the fcc chairman officially out with a plans to kiln that neutrality as we know it. ajit pai joins us for an extended interview. and a bloomberg scoop. dropbox hits akil moscone -- hits a key milestone on its way to an ipo. first, the trump administration lays out sweeping proposals to reform the u.s. tax system. the plan proposes to cut the corporate tax rate more than 1/2 to 15%, business is big and small. there would also be a cut to the top tax rate. there would be a 1% -- one time tax on moneys currently over sure -- overseas. why there needs to be tax reform -- >> our objective is to make u.s. business the most competitive in the world. we have a 35% corporate rate on worldwide income and deferral. it is perhaps the most comp located and uncompetitive -- most complicated and uncompetitive business rate in the world. not a surprise that companies leave trillions of dollars offshore. caroline: how will the tech industry be impacted? we are joined by lisa de simone, a professor at stanford graduate school of business. with us in the studio, tom giles. lisa, i want to kick it off with you. you have been working with tech companies. you have been looking at the impact of potential tax reforms. will this help tech giants? lisa: absolutely. i don't think there is a question. lowering the corporate tax rate is one of the biggest cuts in history ever. leaving more profits in the hands of companies. i'm sure they are going to be happier, and i'm sure the administration also hopes that, with that extra money, they will invest more, whether it's in innovation, research development, tangible, fixed assets, or even human capital, increasing the number of jobs we have here in the u.s. caroline: certainly, tom, looking at the $2.6 trillion of cash held overseas, tech is a large holder of it. tom: the biggest -- the companies with the most cash overseas, alphabet, apple, microsoft, oracle. the list goes on. these are the companies that are poised to benefit the most. my question for lisa and the people we have talked to, including corporate ceos -- they have said rather than putting money into r&d, rather than bringing manufacturing from abroad to the u.s., what they plan to do with this is buybacks, dividends, m&a, and possibly paying executives more money. so, my question is, what does that do for rmb -- r&d? what was that -- what does that do for innovation? caroline: since the date we saw the new president come in, november 9, we have seen internet technology companies perform the best, up 15.3% in terms of total returns. the anticipation is huge of what money could be brought back and how it could be better served for investors. what about consumers? what about r&d? lisa: the tech companies would argue everybody benefits. they are potentially investing in lower-return acquisitions or just sitting in cash. they can bring it back home, put it in the hands of shareholders, who can then go out and buy or invest in other companies. that's the way we will see this innovation. the tech companies would be happy to be able to redeploy their capital in the most efficient way. the administration appears to be trusting the tech companies will do that as a result of this change. caroline: we've talked about giants, but what about the smaller companies? will this help smaller and medium-sized entities as well? lisa: they are probably less affected by the change in our international tax system on the but they will still get the benefit of the big rate cut. that flows through to not only the companies that have organized themselves as c corporations, but a wide variety of legal forms that are more commonly used by the small and midsized businesses. we are getting the benefit of that big rate cut that they would not have gotten under the previous tax regime. caroline: it's fascinating. prior to this repatriation money, we see some rather creative ways that certain tech giants were using tax loopholes, using tax havens, for example. do we think that might come to a bit of an end? tom: you still have an incentive to have low tax rates overseas. you are still subject to whatever tax scheme is in that country, especially as they moved to a more territorial system. you are still subject to the taxes in that region where you have a receipt. you do have an incentive to keep it there. you wouldn't have that same 35% tax here. that would remove that obstacle. to the point about the smaller to mid sized companies, if you believe that cash brought from overseas is going to be used on m&a, that would benefit the smaller to midsized companies that could potentially become takeout targets. my question again, getting back to this, what happens with the money when it comes back -- the trump administration has talked about wanting this to be a way of bringing manufacturing to the u.s., creating jobs. but if what you're doing is paying dividends and buybacks, does that really create jobs? does that end up in the coffers of wealthy individuals and investors, or does it end up getting plowed back into the economy? that's going to vary from person to person or company to company. there is a big question about that. caroline: lisa, you've talked about how you think money will be more efficiently deployed. it's fascinating. there's a call for more jobs, but automation is one of the key killers of jobs. have you got a sense of whether this will benefit the economy of a whole as tom was talking about there? lisa: i do think it will benefit the economy as a whole. if the focus is to bring back a certain type of job to the u.s., manufacturing jobs, for example -- that's a nontax issue. that is something that needs to potentially be addressed through other types of policies. education being a big deterrent to people moving from manufacturing jobs towards the types of jobs that are available here, like automation. somebody has to program the software and provide maintenance for all of these robots were going to be providing the manufacturing that used to be provided by humans. that's the shift i think we need to make, because i don't think we are going to be able to compete on the wages that are being offered by other parts of the world. that's not a tax play. that is something different. caroline: to that theme that you just mentioned, we've been talking a lot about the repatriation and the money that we might see brought back because of this one time tax holiday, but what about border taxes that have been so talked about? what about exporters vs. importers? are there particular companies that might be worried about what they -- what will happen when they want to import pieces of equipment they need to use? lisa: absolutely. i think that is still the big open question mark that we did not get a lot of answers on today. we are talking about moving towards a territorial tax system, where the united states companies are just going to be taxed on their business activities in the u.s. the question is how you define that. until this point, it has been based on where the profits are produced, where the economic activity is being done, the rnd, the marketing, all those things -- the r&d, the marketing, all those things. now, they are changing the definition to where the product is sold. that will help exporters and hurt importers, who aren't going to be able to take the deduction for imported components. that's going to hurt them. these other companies that are potentially providing those jobs that we want so badly. there are definitely winners and losers, and i think that's why we still don't have an answer on the border adjustment tax. caroline: some answers, still many more questions. lisa de simone, professor. and bloomberg technology's tom giles. now, a revolving door in tech. a prominent venture capitalist says he is retiring from investing. he was an early backer of twitter, instagram, uber, and several other companies, both as an individual investor and through his firm. he could clarified -- he clarified that lowercase will not take on any new investment or raise more money from investors, but will continue to support its current portfolio of companies. coming up, one of those original investments twitter. , shares soared after reports that user growth picked up in the first quarter. this is bloomberg. ♪ caroline: twitter finally seems to be addressing its biggest challenge -- attracting new users. the social network reported that average monthly active users rose 6% in the first quarter compared to the same period last year. this growth comes as twister -- twitter posted a year-over-year drop in quarterly revenue. joining us for a deep dive on whether twitter's user growth will boost ad sales, melissa parrish in new york and bloomberg editor at large cory johnson. melissa, out to you first. i'm looking at whether these numbers are going to be encouraging enough, 6% uptick in users. is that the trump effect? what's behind all of this? melissa: the trump effect -- i guess we have all been talking about that a lot. to some degree, it's a bit of a trump effect, but it's largely more about seeing the name twitter in the press, more than it is growth being directly attributed to the president. the name has been associated with current events more and more and more, especially in this last quarter. sure, i think we can attribute some of it to the political and current events that have been taking place and the conversation around that. caroline: cory, whether it's trump or not, does this lure advertisers to spend more? cory: we know the answer to that. the answer is no. user growth, great. 4% sequentially year-over-year. the user growth has been pathetic all the way back to the ipo. 27% user growth over 3 1/2 years. that is not a big growth business. it's better than it has been. it still stinks. it is still on a small base compared to facebook, instagram. those user numbers are pretty weak. when you add to that their ability to monetize -- with all the data they said they were going to get about users, with all the ways they were going to find the poll numbers out of that, what is the revenue base? how fast is the revenue base growing? the revenues were weak, down on a year-over-year basis for the first time ever. the value of a twitter user is going down a lot. how much they can charge for each user is getting worse and worse. they can't blame it on international. international is still about 79% of the users. advertisers just are not willing to pay to reach twitter users, and that's a real problem for this business. caroline: to cory's point, there was a great quote in the bloomberg story, saying when facebook grows at four twitters per year, that tells you there is something really wrong here. is there something really wrong, or are we seeing a bit of a change in how they are going to be charging? will revenue eventually pick up? melissa: i'm a marketing analyst, rather than a financial analyst. when i look at it, it's true. revenues have been declining, and that's scary. they are doing things that will be more appealing, that will make them more appealing to advertisers in the future. they are doing some hygiene, ettinger rid of some products they know don't work. -- getting rid of some products that they know don't work. they are cleaning up some measurements. these are small things, admittedly, but it looks like they are going in the right direction. are substantial changes really needed? yes, i think so, both in terms of the core product and the ad products. i think we need to see some real innovation rather than some of the incremental changes. from my perspective, the moves they are putting in place should make them a bit more palatable to advertisers in the future. cory: these minor changes -- a bit more, i would agree. it's not quite lipstick on a pig, but a bit more, incremental changes. 2% user growth. we showed you the percentage of the change. what is the dollar amount? $1.67 this year for quarter. that number should not be going down. they should be earning -- learning more and more about their users, find better ways to use data, have closer relationships with their advertisers. when you look at the value of a twitter user on the dollar basis, going from $1.92 a year ago to $1.67 in the quarter the announced today, that's the wrong direction. maybe it's because they cleaned something up getting rid of some advertising vehicles that they didn't want to have around anymore, but losing the nfl contract -- seeing these numbers go down in all the wrong places, it's a real concern. the stock was up today, but it's way down from where it was, because what twitter could someday be -- it's becoming clear twitter is what it is. caroline: the shares are still lagging near a record low for twitter. last question. you talk about the cleanup and how autoplay video would be less to charge for than other ways of video. what do marketers really want to see? what could twitter due to really start to lure in the advertising bucks and make each of us who are on twitter more valuable to the company? melissa: data is a big play. they are making some big moves in their platform, cleaning it up. i think they will be able to monetize that cleaned up, more hygienic, more accessible datastream. that doesn't solve the ad revenue problem. i think we need to see some really robust, new ad products. monetize that cleaned up, more it's not going to be about autoplay video. it's a nice move to see, but i don't think that is the end game for twitter, if they are really trying to be profitable in the long term. i think it's something we haven't seen yet. i wish i had a good idea. i would happily share it. i think it's going to be some -- it will need to be some new products that we just haven't seen yet, or else they are just going to continue to lumber along the way they have. caroline: melissa parrish, great to have you on. bloomberg editor at large and the birthday boy in the house, cory johnson. give him some twitter love. he may be casting aspersions on the company, but you are great on twitter. cory: much love for twitter. caroline: paypal shares popping in after-hours trading. investors are starting to embrace the company's strategy of converting the online payment platform into a digital wallet. the ceo's strategy is working as the company raised its annual forecast. joining us tomorrow is paypal's cfo. coming up, google's parent company is set to report earnings thursday. the numbers wall street will be focused on explained. and a feature we would like to bring to your attention, our interactive tv function. find it at tv on the bloomberg. watch us live and see previous interviews. you can become part of the conversation by sending us instant messages during our shows. this is for bloomberg subscribers only. this is bloomberg. ♪ caroline: espn will cut about 100 staffers this week in an effort to save money. that's according to a person familiar with the matter, who says the leader in sports tv is coping with rising costs and fewer subscribers. the espn president says the disney-owned network is determining who to cut from the current payroll. also out with earnings thursday, google's parent, alphabet. it closed at a record high in the days trading. the company's been hit by an advertising controversy, with some companies withholding spending, citing concerns about videos their ads ran alongside. julie: alphabet closing at a record high, one day before it is set to release earnings. the company was hit by youtube advertising controversy as companies at one point halted spending, citing concern that their ads would run alongside offensive videos. let's to get -- look at alphabet. it's google division dominates the digital ad industry along with facebook. the two of -- google owns about 40% of the market. together, they own about 60%. a lot of people call them a duopoly. google advertising makes up about 86% of alphabet's revenues, a big chunk. advertising, the white line, above and beyond, higher than the others. google's properties like youtube and google search have played a major role in the rise of digital advertising. when combined, internet ads on mobile, the orange bars, and videos him of the blue bars, are set to surpass -- and videos, the blue bars, are set to surpass tv advertising. the spread gets wider. outside this category, but increasing conservation from cloud services should continue to support alphabet's revenue growth in the first quarter. the group has seen a surge. don't be surprised by earnings. each year since 2012, alphabet has missed consensus sales estimates in the first quarter. while analysts don't expect the recent advertising controversy to affect the results, they will be watching for comments on how executives are solving that issue. we will be following alphabet pasta earnings -- alphabet's earnings after they are released. caroline: that was bloomberg's scarlet fu earlier. coming up, fcc chairman ajit pai calls for a review of net neutrality. defenders vow a tsunami of resistance. we'll hear from chairman pai. if you like bloomberg news, check us out on the radio. you can listen on the bloomberg app and in the u.s. on sirius xm. this is bloomberg. ♪ ways wins. especially in my business. with slow internet from the phone company, you can't keep up. you're stuck, watching spinning wheels and progress bars until someone else scoops your story. switch to comcast business. with high-speed internet up to 10 gigabits per second. you wouldn't pick a slow race car. then why settle for slow internet? comcast business. built for speed. built for business. did you know slow internet can actually hold your business back? say goodbye to slow downloads, slow backups, slow everything. comcast business offers blazing fast and reliable internet that's over 6 times faster than slow internet from the phone company. say hello to internet speeds up to 250 mbps. and add phone and tv for only $34.90 more a month. call today. comcast business. built for business. >> it is 11:29 a.m. in singapore. i have the latest first word news. the bank of japan has kept policy on hold as expected. they have warned core inflation will have its 2% target ending in 2020. they have upgraded their economic output. an increasing trend and expansion turning towards moderate or it they say the mentum is not yet firm enough chinese president xi jinping has called for better financial security, saying it is the foundation of a stable economy. by meeting was also attended the president and authorities. they will have a review of online finance. they reiterated china's risks are controllable. is easingic momentum although others remain up to mystic. the manufacturing index monitors industrial act 70 it edged down coming suggesting the growth may have peaked. expectations rose for a third straight month in april. its current is the most positive ever. global news, 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg. >> we are waiting on the ecb's decision. it was barely a blip following the boj announcement. they would only have more wiggle room if it from some before that happens. they are keeping stimulus unchanged. they are signaling a 2% target remains distant. tailing -- take a look at the equity space. japanese shares maintaining their downbeat tone. the topics easing the days declined so far. snapping a five-day rally. time we saw a rally of this sort was in december when the topics gained for six straight days. take a look at the nikkei 225. the readings have dropped there, falling almost 10%, along with the likes of mitsubishi falling the most in five months. the outlook is looking dismal as well. we do have the likes of toshiba down 3.4%. lots of earnings to digest. caroline: this is "bloomberg technology." i'm caroline hyde. now, there is a major showdown brewing in washington. cracking open the net neutrality debate. fcc commissioner -- chairman ajit pai introduced his plans for rolling back net neutrality. the net neutrality rules aim to prohibit internet service providers like comcast, at&t, and charter from favoring or discriminating against online applications, content, or services. ed markey responded to chairman pai's repeal, saying it makes no sense. we cannot keep the promise of net neutrality without the rules that ensure it. chairman pai and the trump administration should expect us to not meet of resistance from the grassroots movement of americans. pai and his backers say the rules have hampered the fcc's efforts to close the digital divide. joining us is the federal communications commission's chairman, ajit pai. wonderful to have you with us. first of all, i want to ask about how you intend to take on the tsunami of resistance. have you braced yourself? chairman pai: this is going to be a political debate that will engage millions of people. we will stay focused on the facts and the law. americans believe in a free and open internet, but they also want to have infrastructure investment. they want those next generation networks to be built out. we don't need heavy-handed regulations that saddle businesses with a lot of rules that this incentivize them from building those networks. that's going to be the course we are charting henceforth. caroline: have you had commitments from the internet service providers that, if these rules are repealed or changed, they will invest? i'm looking at the profits of at&t, $14 billion, $8 billion if you are comcast. shares have risen since that original ruling of net neutrality. they don't seem to have really been heard. chairman pai: they are down 5.6% for the top 12 broadband providers in this country, and that doesn't include the smaller providers who aren't included within that statistic we have heard from a number of providers, cable, wireless, telephone, and others, who have told us these regulations are impeding them from executing on their business plans. they are not spending as much. they can't get as much financing. 22 isps told us that title ii hangs over our business is like a black cloud. that's the kind of regular -- regulatory overreach we want to remove. every american deserves better, faster, and cheaper internet, and i am committed to delivering it to them. caroline: how can you ensure that rural areas are indeed provided for? chairman pai: the net neutrality regulations take us in the opposite direction. they reduce competition and increase digital redlining. anthony's have more of an incentive to look at -- companies have more of an incentive to look at rural or urban areas and say, let's not deploy. we want to make sure that everybody has the internet access that they need and want. i have a very proactive, proconsumer agenda to promote internet access, especially for those on the wrong side of the digital divide. caroline: you say you are taking some replacement regulation advice. you are looking for suggestions. what do you think will come to the fore when you ask for this sort of advice? chairman pai: that's precisely the reason we have started this conversation. this is the beginning of the discussion, not the end. we want to hear from the american public, what is the best way to preserve those core values of a free and open internet, more competition, greater investment and infrastructure? i'm confident that we are going to be able to find a way that will appeal to consumers. caroline: you're talking a lot about consumers. you're going to hear their voices. you've already heard the voices of perhaps smaller startups that might be affected by this. others have voiced their discontent. the letter that you received that said rather than dismantling regulations, it would allow -- we urge you to focus instead on policies that would promote a stronger internet for everyone. how can you allay those sorts of fears? chairman pai: i think a free and open internet has delivered unparalleled value to the american consumer. 20 years ago, who could've foreseen the companies like google and facebook and netflix would have become household names not just in the united states, but around the world? they thrive because of the light touch regulatory approach that started in the clinton administration and proceeded through the obama administration. that will promote startup entrepreneurship everywhere in this country going forward. i'm committed to giving them a chance to succeed. title ii does not allow them or others the ability to do that. caroline: why are they so worried? chairman pai: a lot of people have stirred up hypothetical harms and hysteria based upon what they think will happen. if you look at the 2015 decision, you would look in vain to find any example of systemic market value or where providers were acting to block access to lawful content. we want to take a very fact-based approach and figure out the best way to preserve this -- those core values, a free and open internet that allows entrepreneurs to thrive and increased competition. those with a -- are the kinds of things that will allow everyone in the internet economy to benefit. caroline: the argument is more competition will promote the likes of at&t and comcast to play by the rules and make it a fair and open internet for the content providers. is there anyway way that you think this could or should be measured? are you going to look for any site of oversight? i know you don't want it to be heavy-handed, you said. chairman pai: we will be asking for public input on what the regulatory framework should be. we know title t is not the right answe -- title ii is not the right answer. i will be publishing the text of my entire proposal tomorrow. we tee up a number of ideas. we asked the public, is there anything else we should be thinking about going forward. we will try to find the best way. caroline: therefore, when you go out and start discussing -- trying to bring some republicans as well as democrats into your line of thinking -- what do you think will be the best way of getting certain democrats who are so against this on board? what's your key line of clarity? is at the moment? you want to stick with the facts? chairman pai: we are going to be doing more of a fact-based approach than we did previously. the bottom line is the arguments i am making today are precisely the arguments that were made by president clinton in the 1990's, the arguments that were made by president clinton's fcc chairman in the 1990's. this is not some radically political fringe argument that i'm trying to make. it's a light touch approach that served the united states well under democratic and republican administrations alike. i want to take up a little heat out of this argument to the maximum -- i want to take the political heat out of this argument to the maximum extent possible. americans are best served by a light touch framework that focuses on the facts, adheres to legal principles, and respects the basic principles of economics. the more heavily you regulate something, the less likely you are going to get more of it. caroline: would you prefer congress to step in here? would it be better to have congress and a legislative compromise so that we don't have this back-and-forth every time there is a change in administration? chairman pai: three years ago i suggested the best solution would be for congress to sit down and tell us what the rules of the road should be, and that would take the fcc out of this business of trying to shoehorn the realities of the modern marketplace into an 83-year-old legal framework that was designed for ma bell in the 1930's. if congress speaks, if our elected officials tell us what they want the fcc's role to be in the internet economy, i will respect that. what is the best solution going forward. caroline: fcc chairman ajit pai. thank you so much. we wish you well. chairman pai: thank you. caroline: coming up, our exclusive interview with dropbox ceo drew houston. the company's latest milestone. this is bloomberg. ♪ caroline: now to our exclusive conversation with dropbox ceo drew houston. the cloud file sharing startup has been touting financial milestones as the company inches towards a public offering. dropbox is cash flow positive. they are also ebitda positive. i spoke with drew houston this morning. drew: it's been great. we have 500 million people around the world using dropbox. we have 200,000 paying business customers. a lot of milestones that we are proud of. in january, we crossed $1 billion revenue run rate. it turns out we are the fastest company in history to reach that milestone. last year, we shared we are free cash flow positive. today, something we haven't shared, is that we are also profitable on an ebitda basis. that matters because it's a rare combination. it's rare for software companies to be operating at our scale, our level of profitability, and to be growing at the rate that we are. so, we are really proud of that. caroline: the enigma --profitability. how did you achieve it? how have you managed to scale to that? drew: it starts with our customers. people love dropbox. i think it's a testament to the strength of our business model. inside the company, we like to say we have 500 million salespeople, because all those millions of people have dropped -- dropbox -- brought dropbox into millions of businesses, and that's how we grow. the vast majority of our revenue is self-service. you pay with a credit card. which means our sales and marketing costs are a lot lower. you combine the scale and efficiency, those are the ingredients. caroline: it's interesting that you have helped lower the cost of business to other industries and areas. where do you see these sorts of efficiencies going in terms of technology in general? i'm interested in your viewpoint on whether you are an optimist or pessimist as to whether technology is pushing forward and helping efficiencies work. how do you feel that silicon valley is adopting that? drew: when you zoom out, technology is progress. there are a lot of great things about that. the humanity in our evolution. when you zoom back in, one thing we talk about is that, for every problem that technology solves, it feels like it creates a new one. so, things like email and thumb drives -- at the time -- were these great inventions. when you look at it another way, they were kind of holding us back. a lot of these pain points become opportunities for us, whether it's frustration around thumb drives -- it's representative of a broader problem we are working on. when you add up all the time we spend looking for information, something like 60% of our time is spent on this overhead, work about work. we are trying to put a dent and knock that number down as much as possible, because it is a huge waste. when you think about tech, more broadly, i think we will end up in a good place, but at the same time as technology, whether consciously or subconsciously creates new problems, we have to be mindful of that. we have to be solving those issues, too. caroline: do you mean something for entrepreneurs and business leaders to be looking at? how much should the administration be looking at it? drew: we are a company. the company and the government -- we are part of a broader community. i think it's something everybody has to look at. caroline: when you looking at the current administration in the u.s., there's been rolling of eyes and exhaustion coming from silicon valley, whether it's the travel ban, the visas -- how have they hit your business, if at all? drew: it's been an unpredictable 100 days or so. a lot of the positions that the administration has taken, things like the executive orders on immigration are really troubling. my cofounder, his parents emigrated from iran. if that kind of thing was in effect now, there would be no dropbox -- or when we started. so, tech -- we are all rallying together and figuring out what we can do to engage. caroline: rallying together in silicon valley. is silicon valley at the best place could be right now? some of the reputational damage that is happening, do you think -- drew: i think it's always complicated. we focus on the things that are in our control. we see, when we talk to our customers, there's a lot of problems out there that no one is solving. that's where the bulk of our attention goes. caroline: and i want to get a little bit of insight as to where you tell other entrepreneurs to go now. those that are wanting to be the next ipo, one in see their business scale such as yours. have you got one or two recipes for success? drew: when it comes to a lot of these problems, one thing that was surprising to me is it's actually easier to go after big problems than small ones. i thought it would just be harder, because the challenge is so much bigger. what happens is people are really motivated. they are inspired to take these things on. it's easier to attract great talent. my advice would be to set your sights high. caroline: that was ceo and cofounder of dropbox, drew houston. coming up, china's ride-hailing app has neared the close of a massive funding round. details, just ahead. this is bloomberg. ♪ >> right -- ride-hailing gett has announced it is buying juno. juno offers its drivers company stock and better pay, helping it gain a lot of ground in the new york market. sticking with ride-hailing firms, one is close to a milestone. it is near an agreement to raise $5 billion to $6 billion in a deal that would make it the most valuable startup in china, surpassing a smartphone maker. the round will lift the valuation to about $50 billion, up from $34 billion, after its acquisition of uber's china business. lulu chen has the story for us. give us the details, the nitty-gritty on this funding round. we know the valuation could be significant. they have some big bc' -- vc's that have already read -- backed this company. lulu: they are close to closing the fund. the main investors, silver lake , soft and, and like you said at $50 billion, they are china's largest startup. caroline: what is didi going to be doing with this money? is it going to take on its former rival or frenemy more? lulu: there's a lot of areas they can explore. this money is coming in a very timely fashion. the past few months have been very tough on the company, especially since the chinese government issued the stringent regulations that hampered the main revenue stream of theirs. this buys them more time to develop more revenue avenues and delay a possible ipo, which was floated as an idea last year, according to people familiar with the matter. in terms of other areas that they can explore, driverless technology, they are locking heads with uber and google. didi still has global aspirations. they still have an ally with -- in southeast asia and india. still competing with uber on those fronts. caroline: talk to us about some of the other regions they have been looking to get in. has it been a hard slog? lulu: didi has basically taken an approach to partner with the local competitors, local operators. they are not actively building out an organic business on the ground there. same case with southeast asia and also regions like south america, which they said they also have interest in expanding in. caroline: fascinating. we could see an ipo coming from china, perhaps faster than we see uber going public. talk to us more about the regulatory hurdles they had at home -- they have had at home. which revenue streams have been hurt? lulu: the majority of their revenue still comes from their private car-hailing service and their fastcar service, like uberx. the chinese government has issued these regulations across dozens of cities across china, especially beijing and shanghai. they have limited the number of people who can drive on the road to only local residents, higher requirements for cars as well, so this has cut down on their revenue stream in those sectors, which has probably been their main revenue, area for profit. what investors were looking forward to when it comes to talking about a potential story for an ipo of the company. caroline: the rode for ride-hailing company's never runs smooth, it seems -- ride-hailing companies never runs smooth, it seems. that's it for this edition of "bloomberg technology." earnings season continues thick and fast on thursday. we will have full coverage and analysis. this is bloomberg. ♪ ♪ anchor: next stop is the ecb. no policy changes, traders are watching for hints on a qe withdrawal. waiting president trump's tax proposal. details are sparse but there is a one-off levy absorbed. opec ministers to

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