Revenue little changed at 12 billion while profit rose slightly to 2 billion. The ceo says Revenue Growth in the Data Center Chips and the internet of things helped offset slumping demand of pcs. Shares are up in afterhours trading. President obama is going to drop cuba from the list of nations that sponsor terrorism. The president notified congress about the move today. It had been a Sticking Point as the u. S. And cuba try to normalize relations. It comes just days after obama met with cuban president raul castro, the first formal meeting between the u. S. And cuban leaders in more than 50 years. The Senate ForeignRelations Committee approved the compromise bill giving congress the power to review a deal with iran. The Obama Administration is now indicating that the president will sign it. Former defense secretary William Cowan says such oversight is necessary. I dont think you can trust iran. They have to earn the trust. They will earn that trust by showing they are committed to an agreement that restricts their ability to break out into a Nuclear Weapons capability. Emily the compromise bill would cut the length of time to 30 days instead of the proposed 60 days. Avon products exploring the sale of its north american operations. The Cosmetics Company is not running a formal sales process but is open to offers. Thats according to people familiar with the matter, who said declining health in north america may deter potential buyers. Avon has posted three straight years of losses. And google has been told it will face charges by the eu for violations. People with knowledge of the matter say a decision will likely be announced this week, after more than four years of regulatory scrutiny on how google delivers internet search. Google gets about a third of its revenue from the region. Aol takes aim at google and facebook with new advertising technology. Today aol unveiled an open programmatic ad platform designed to help advertisers figure out how to spend their dollars best. The Technology Takes all of the various ad tech and puts it into a onestop shopping at platform. It allows brands to measure the effectiveness of their ads. Cory johnson is with me here now. You spoke with the aol ceo, Tim Armstrong. Should google and facebook be worried . Cory they are all going after this market, providing ads not just for their own network but for the web on all devices. And even for television, a very interesting development. I talked to Tim Armstrong about that very thing. Tim armstrong what really is happening is the biggest pivot point in media, to the way internet media is going to be done. The targeting of advertising at a much deeper level across mobile, internet, and today our launch of one by aol is a front product for the next generation of internet advertising systems. As you just described, its the most powerful time for marketplaces in the world. I think aol is stepping up with the most powerful futuristic marketplace for advertising. Its been five years of work, and very exciting externally. Internally we are even more excited, because we know the power of this product. Cory you guys have done so many acquisitions of all these little companies. Is this stitching it all together in one platform . Tim armstrong we had video and Programmatic Advertising and global content brands. When you think about those three areas overall, we have knitted together both of these platforms with some of the most exciting acquisitions. Today when you take a step back, aol is a top three player in video, top player in distributed content on facebook. I would say today for the programmatic platforms, nobody has a more advanced system all the way through mobile than aol. The stitching together of our strategies has been really important. We have not changed in five years and its a 30year strategy in front of us. Cory i think about what clever marketers do. They cleverly did not buy a Super Bowl Ad but they went to the market where they thought they would have the most impact. They wanted to go with a particular kind of ad that would reach a young male customer. They were clever about how they would target individual tv markets and markets on the web. It sounds like youre talking about the shift from demographically focused advertising to results focused. Is it a combination of the two . Tell me how that might work in a real case example. Tim armstrong one easy way to think about it, if you are intuit, youre taking advantage of a very singular trend. Media was built in bulk and sent to consumers in bulk, and now its being built on a singular basis in many cases and sent to consumers on a singular basis. With an advertiser like intuit on our platform across multi device and multiformats can talk individually to consumers. When you think about it, the future of connecting with people is really going to be on a singular basis. Thats why social networking is important and people doing individual searching is important. Our platform is the first to take advantage of the singular nature of singular content going to singular consumers. The fact that almost all human beings in this country are Walking Around with machines in their pockets that are essentially as powerful as a cable box, all of our systems are built to deliver highquality content and highquality advertising in a singular way into everyones pocket. That is going to be a very significant shift for the entire media and Internet Business for the next two or three decades. Cory there is a technological problem there because smartphones dont accept cookies. How can you track the efficacy of an ad when you cant get that feedback from the cookie . \tim mobile is really about device targeting and for us we have 100 million devices in the United States that we mechanize and understand and crosslink between a mobile device and a desktop and ott. That creates a very powerful union. If you think about the way the consumers consume media newspaper, a broadcast tv network, or maybe on digital and today with aols new system we can cross format target you in general. It actually makes what cookie targeting was in a much more powerful way because it is cross device. When you think about advertising in the future, a lot of people think technology is going to deflate ad places overtime. I would make two bets with advertising one is that it is going to get better and more creative for consumers, and number two is you get ad prices go up. A 600 billion industry where there is a lot of ads for you dont know how they work and people spend 600 billion. Imagine how much they will spend when you know how much each ad to each individual consumer works. Emily aol ceo Tim Armstrong there. Cory, is this something he has been plotting for a long time . It seems like a lot of things led up to this point. Cory they spent hundreds of millions in acquisitions to get to this point. What is interesting is not this way it provides efficacy for advertising and huffington post, or even other parts of the web but the notion that this goes crossplatform to television smartphones, aols and others sites on the web. This could truly be transformative for aol. Emily aol could be telling them where to put their dollars. This is, lets be honest, relatively archaic media organization. Cory what they have been really clever about it doesnt take a rocket scientist, but they recognize they have this great cash flowing but slowly declining business of Internet Access provided by aol. They knew they had a certain number of years as that bleeds its way out. But using that cash to create a network of places to run in and now a machine to run ads across all networks, it is very clever, and it becomes a very new and different kind of Company Going forward because of this one announcement today. Emily a new aol. Cory why not . Emily marco rubio, the oakland as of president ial politics . We will talk about his moneyball strategy to win the white house, next. Emily i am emily chang and this is bloomberg west. Still to come, senator marco rubios moneyball campaign. How he is using the data to woo donors. And a major telecoms possible Alcatel Lucent deal. The imf is keeping its Global Growth forecast at 3. 5 for this year. The imf predicts that the strong u. S. Dollar will boost europe and japan and cause some softness in the u. S. Here is chief economist Olivier Blanchard on europe. Olivier this is leading us to have a higher forecast for the eurozone for this year than last year. The main risk that we saw last year was the risk of recession in the eurozone. It hasnt disappeared but it is much smaller than it used to be. Emily as for greece, he says the greek exit from the eurozone would be extremely painful, but he says the rest of the euro is in a better position to deal with it. Real estate website zillow gives an update on its integration of trulia, a rival website it purchased earlier this year. Zillow says the long ftc approval process has caused hurdles in the transition and will lead to lower than forecast revenue for the year. Zillow paid 2. 5 billion for trulia, including stockbased compensation. The 2016 president ial candidates are already sparring through twitter and youtube, but when it comes to tech and politics, it is not just about social media. Campaigns are now investing in big data come up big time to learn more about voters and their competitors. Florida senator marco rubio announced his campaign yesterday and fundraisers are already calling him the moneyball candidat. To take on cash heavy republican rivals like jeb bush, rubio is turning to Data Analytics and Digital Strategy to run a leaner operation. The optimizer ceo has seen the effect first hand. You were the head of analytics for president obamas 2008 campaign. What is rubio right about the other candidates doing wrong or not doing at all . Dan i think his approach is really clever because he is going against opponents with a huge amount of fundraising behind them using the strategies of his father and brother, raising hundreds of millions of dollars through traditional means. Rubios strategies about investing in areas where they can have a big impact in terms of efficiency. That is where i think using data to make better decisions is critical. Emily areas like what . Dan particularly around fundraising. That is the strength of datadriven decisionmaking right now. If you can think about where the campaigns can spend their time as a candidate, and doing traditional fundraisers through hotels will bring some money in, but if they are able to use optimization and testing to improve the effectiveness of their website and online presence, that can raise a lot of donations from any small donors. Emily what is more powerful big data or big money . Who would you rather be . Dan big data is potentially a way to become big money. If you look at the history of the Hillary Campaign versus obama in the primaries of 2007 the First Quarter of the fundraising race, hillary used traditional means to raise slightly more than obama but the following quarters, through many small donations, obama is able to beat the traditional tactic of traditional fundraising. Emily i understand hillary this time around is very much investing in a good data. Whose strategy is better . Dan hillary might have the best of both worlds where she has connections to raise big money from the donors but also the grassroots support for datadriven decisionmaking to raise money from many more voters. Emily how big does the Big Data Team needs to be effective and how much does this cost . Dan in 2008 the team was small, about eight people. Both of the Obama Campaign and the Romney Campaign in 2012 invested heavily in optimization and testing and we saw dozens of people focus every day on using experimentation to help make better decisions. Emily are you basically just paying for the manpower . What else are you paying for . Dan i believe the real value comes from having the person on the campaign do what they are great at coming up with ideas to test. And have the technology do what it is great at, statistical inference, and figuring out what actually works. The marriage of both, the creativity and technology, that symbiosis is where you have great impact. Emily give me a sense of how this works. How quickly can you access the information and what does it lead to . Dan it is in real time and it comes down to using the data that the campaign has about somebody to give them a better experience. It can be as simple as coming to the website and realizing you have donated before. If you donated 10 before, the message and experience you get should be different from if you donated thousands of dollars before. In that case you should be asked to come to a Hotel Ballroom or to meet the candidate over dinner. If you donated 10 before, that is not quite as effective. Emily what types of companies will these candidates be turning to . Are there startups out there that are particularly efficient . Dan i happen to know one. [laughter] over the last few election cycles, several companies have emerged from the opportunities to use data to make better decisions, both from the right and left side of the aisle. Emily do you think jeb bush is hip to the change . Dan it will take one quarter of the fundraising where rubio beats him for him to consider a new strategy. Emily thank you for joining us, former director of analytics for obamas 2008 race. Nokia is in talks for its biggest acquisition yet. What will its potential tie with alcatellucent mean for the Telecom Business . Emily i am emily chang and this is bloomberg west. Nokia is in advanced talks to buy French Company alcatellucent. Talks are so serious that the ceos of both our meeting with french president Francois Hollande it today. Such a deal would be nokias largest acquisition ever and could vault erickson as the largest maker of Wireless Network equipment. Here to break it down is editor at large cory johnson. Paint the big picture for us. Nokia isnt the company once used to be. And alcatellucent is a Different Company as well. Cory back in the dotcom bubble, there is no bigger deal than alcatellucent in the world of networking. The french companies, alcatel and the former at t labs, bell labs, later called lucent technology, when they came together it seemed like it would be the dominant Network Business in the world. What happened was it is hard to run a business in france. It is hard to make changes to business in france and the business struggled mightily. But lately alcatellucent is killing it. The number one networking business period out there, top five in all that it serves. As my friend tim savage likes to say, it is really lucentalcatel now rather than alcatellucent because the lucent business is the very best in the world, and they are getting that benefit from market and they really finally put this long, slow slug of our merger behind them and are doing quite well. Emily this could create a rival to ericsson and cisco. But is bigger necessarily better . Cory i think it is a fair question. The quality of their products, the core of people who buy their products, whether it is verizon or at t or any number of Telephone Companies around the world, is topnotch. Cisco is having problems selling in china in part because the u. S. Government products are not widely wanted because of nsa issues. And their products arent widely sold here because of concerns over chinese spying. You can see it in the results and the revenue the revenue has been shrinking on an annual basis as they have gotten rid of crummy businesses, and they had struggles along the way. You have recently seen a turnaround in the profits of this business. The profits in the last six years, the profits in the last six quarters, have started to look a little bit better. Still losing money, but last year losing only 118 million. That is a significant turnaround. While sales have come down a little bit, losing less money, selling a little less and losing a lot less money is a significant improvement for this company. Emily could the proposed time warnercomcast merger impact this at all . Cory yes. They will spend less and are an important customer in this arena. It is worse for all the competitors, certainly nokiaalcatellucent. Emily what does this mean for nokia . Does it mean more customers in the United States . Cory it is a very big deal for them. Emily cory johnson, editor at large. We will keep watching to see how the talks unfold. Coming up, ibm makes a big bet on health tech. How supercomputer watson is moving health care to the cloud. Emily this is bloomberg west, or we focus innovation technology, and the future of is this. J. P. Morgan chase reports a 12 increase in firstquarter profit, beating estimates. Trading revenue rose in the First Quarter for the first time in five years. Here is jamie dimon on the current environment of banking. Jamie dimon Banking System is much stronger to start with. Just trying to think through the effects of some of these things. Were looking at it as a warning shot across the bow. What happens in a stress environment . People Pay Attention to what is going on in the markets. There might be some changes down the road. Emily he says the banks valuation is hurt by uncertainty about future legal talks. . 10 lost 11 billion in market value after the chairman cut his stake. It left him with a 9. 5 percent stake. Shares surged, boosted by the rally in chinese stocks. Tencent operates a number of platforms across china. A Software Startup is the latest member of the 1 billion valuation club, doubling its valuation from just a few weeks ago. The Company Raised 95 million led by Venture Partners along with new investors like goldman sachs. Docker is a platform for building, shipping, and running apps. The notebooks of alan turing have just sold at an auction in new york. He wrote in the notebooks from 19421940 or while leading the team that cracked the enigma code in nazi germany. Sales and restaurants overtook sales in Grocery Stores in march for the first time ever, according to data from the commerce department. A recent Gallup Survey shows that over americans are less willing to spend at restaurants and bars, while younger americans are. Watson, ibms supercomputer, perhaps best known for its appearance on jeopardy, is bringing health care to the cloud. Ibm has established an open platform for doctors researchers, insurers and other companies focused on health. Group also announced a partnership with apple, Johnson Johnson and medtronic and the acquisition of big Data Analytics companies. Joining me to discuss all the newss Senior Vice President mike rhotin. Thanks for joining us. Watson can do so much more than when jeopardy these days. What specifically has watson helped do that United Health are mayo clinic cannot do . Mike we spent the last are working on the knowledge side of this and with watson understanding all the research material. Now what we are doing is bringing together all the structured information, the data that comes from the devices that we carry around, the consumer and medical devices. The amount of information that humans are going to collect through our lifetime is reaching the point where its equivalent to 1100 terabytes of data, or about 300 million books about each and every one of us. This is an enormous amount of information. We will deal not just with the knowledge of medicine and research, we will deal with the big data around all of our individual health. And you together in the cloud environment. Emily give me some examples of what watson could do for me as a patient. Mike you might be collecting your information about your health, you will have the option to share that information with your doctor and they can keep track of the information about you come about your care. For example, you have your Blood Pressure checked on in frequent basis by your doctor, but what if it is being checked all the time and you are taking medication for Blood Pressure . That would be realtime evidence to help your doctor better care for you. Emily how do you protect individual privacy . Mike we have the ability to secure a hipa compliant environment to store the information in a safe way to make it available for researchers. In addition to being able to share from your devices with your doctor, you can share it with researchers around the world. Todays new generation likes the idea of sharing for the greater good. Being able to share your Health Information with researchers is a way to do that, as long as it is anonymous. Thats what this is all about. Emily the gathering of this information takes time. How long until we see the results from Something Like this . Mike what of the important things was the acquisition. We have been starting off from a big place already. Emily how do you monetize this . Who are watsons customers in the future . Mike we are targeting the idea of patient centered health being able to reach out and involve people more in their own health care. Bringing in the partnerships with medtronic, we can monitor data on insulin pumps. With Johnson Johnson, we can provide coaching to enable people to get ready for operations like hip and knee replacements, and then coach them through the therapy to rehabilitate after the surgery. The same data can be used by researchers that are using anonymous data to look for patterns to develop new drugs and new therapy. All the information is available back to your provider, should you choose to make that available. We will bring together the whole continuum of care from the patient to the doctor to the research to the insurance companies. Emily terms of your partnership with apple, what has been the reception from apple customers to these products . How many people are using this and how are they using it . Mike we are still in the early days of connecting to the application. Apple has done a very good job of managing the privacy of that information on the devices and making sure it the choice of the consumer as to whether they want to share the information or not. A new initiative started this year that will appeal to a lot of the millennial generation who believes that life is more about just themselves, its more about contributing to the greater good. Emily so you are saying not many people are using them just yet . Mike many people are using them. We are starting to connect the data back to the health system. That is really the next step here. Emily interesting stuff, thanks so much for joining us. After the break, we talked to visa about how they are using smartphone location data to cut credit card fraud. That is next. Emily this is bloomberg west. I am emily chang. Still to come, visa fights back against Identity Theft with new location technology. Details, coming up. First, a check of Bloomberg Top headlines. Activision is reviving guitar hero after a fiveyear hiatus. This time the game will be available to play on tablets and mobile devices. Its the latest attempt to take advantage of the fastestgrowing segment of the videogame industry. It cost 99 and will go on sale later this year. General electric is developing a documentary series to air on the National Geographic channel this fall. It will feature ge employees exploring topics like alternative energy and aging. A handful of hollywood heavyweights including ron howard and Angela Bassett will direct. Hbos game of thrones attracted 8 Million Viewers for the premiere of its fifth season on sunday. Thats a 17 gain from last year, even after several episodes were leaked online. According to one information site, it was downloaded more than 100 thousand times. Have you ever had your credit card blocked while you have been on vacation . Now they can use your cell phone location to analyze your transactions. The last thing im going on a big vacation is to remember to call my Credit Card Company to tell them i am traveling. Cory this is an interesting thing. Its called mobile location confirmation. It can track your phone and see that you are with your phone. Its a clever way to cross check the location of you and your transactions and make sure its the same person. We have visas Senior Vice President of risk. Mark its important for visa because we look at the authorization data, and we see a lot of declines when people travel. We dont like declines at all. We can take advantage of Cell Phone Technology to say this phone, i know that is a good transaction. I can approve the transaction. Cory so its not actually taking my credit card to buy whatever im buying, when you can see my phone is here in San Francisco. Mark people have a little more confidence now that i can match my cell phone location with where im spending or using my card. Cory im more likely to lose my card than my cell phone. People spend more time with their phone than any other device or anything in their lives, including their family. Mark as soon as you lose your phone, youre going to call and say, i lost my phone. Cory why is this technologically hard . Mark its hard because of the time we have to evaluate a transaction. We have less than one millisecond to look at over 500 data points to determine if this is you. Just getting the speed of processing is difficult. Weve designed a new way whereby as soon as you turn on your phone and you land in paris, that can send information to visa. Later in the day when youre shopping, i already know that you are in paris. So when you use your card in paris, we can have access to that data. Cory give me an example of the things you look at. Mark just like velocity, how many times you use your card in a day, what is your average spend per day, the distance between merchants. If i have a transaction today in San Francisco and an hour later i see a transaction in new york city, it will look suspicious. Theres a lot of general conditions we look at. Cory vacation velocity might be different than home velocity. Is that just a matter of having someones data to recognize the pattern . Mark we processed 66 billion transactions last year. We can determine what is normal behavior for someone particularly if they are traveling somewhere. We have access to a lot of data we can use to analyze and determine the likelihood of problems. Cory i would imagine im working on the english language. This data you get is one data source, but its a lot of information. What kinds of things have you learned that you didnt know you were going to learn about locations . Mark what we have really learned is that it is a good source to determine if its a genuine transaction. We know in general when you are traveling and we can compare that to merchant locations. Cory how long does it take you to understand an individual client . Do you have certain types of people that are similar in some ways but different in others . Do you have a handful of prototypes . Mark we have a profile for every single card in the system. We create a profile for every single card. Thats what we used to calculate it. Cory when i first had kids, i got a lot of dings, because buying diapers was not a big part of my life for a while. Mark profiles change over time. Were constantly modifying the profiles. Cory at a certain place, youre going to do Something Different . Mark were looking at more patterns of fraud. Where are we seeing fraud hotspot . As we see your patterns become a little more unusual, its when we start to determine if its the general consumer or not. Cory what is the predominant type of credit card fraud today . Mark it is from large data breaches, from well organized crime rings that get hacks to tens of millions of card numbers. Our Chip Technology is going to hopefully replace a lot of the fraud that is happening from that. Cory really cool stuff, thanks a lot. Emily after the break, over 40 million music fans watched snapchats coachella video over the weekend. What does it mean for advertisers . That is next. Emily this is bloomberg west. Im emily chang. Snapchat doesnt share a lot of information on User Engagement and growth numbers, but the ceo let out a little tidbit yesterday in a tweet. In a tweet, he said more than 40 million users watched the coachella video over the weekend. Thats more than double the number of viewers tuned in for sundays final round of the masters golf tournament. So how massive of a platform could this he for brands to advertise on snapchat . You were at coachella, you saw the video. We cant see the video because it disappeared, but what was so special about it . The difference from what you get on our story and the other things you could view, coachella was widely covered, fashion blogs were there snapping photos of people. It was covered on live stream. On the live video that you got on our story, it was a very different experience, a much more intimate experience. It was people videotaping their friends dancing, some crazy things that people found on the festival grounds. It was a different perspective. Emily and snapchat weaves it all together . Sarah yes, they have people when people take their snap video, they can decide whether they want to submit it to be a candidate for the life story. Emily put it in context for us. How do we know that this is good . Sarah its more people than watched the olympics Opening Ceremony last year. Its a huge number. Its more people that watched the oscars. Emily how does it compare to facebook and twitter . Sarah facebook doesnt have a super bowl size audience every day on the lat form. Advertisers have to consider the fact that all of this is appears and is not something that can have a long life the way something on youtube can. In some ways it makes it more special, more invested in the moment for the people who are watching it live. Emily so obviously a huge potential for advertisers here. Sara advertisers have told us they can get about a Million Viewers a day on discover. Thats pretty good for a show. Sometimes they have sponsored content. Emily so are advertisers interested in this . Sarah they are experimenting. Ads now are more expensive than some of the other leading video app providers. Sometimes double what you would pay for hulu or youtube ads. Its in research and development right now. Its all the lineal viewers, the kinds of people who went to coachella are the kinds of people on snapchat. Emily i wish i had seen the video, i missed it. Now its time for the bwest byte, one number that tells a whole lot. Cojo, what have you got . Cory 957,000 apple watches were sold over the weekend in the u. S. The notion that they soldl just a million watches was the headline. If you extrapolate that number across the globe and imagine what they would have sold if they had sold the same amount in asia and europe, you can get to a number of about 2. 3 million watches sold right off the bat there. That is a tremendous success for apple, right out of the chute. The average selling price is probably high because of the 70,000 gold watches, it was probably a pretty good weekend for this new device to control your phone and do a lot more. Emily and a big wait if you want one of those apple watches already. The storewide Developers Conference is coming up in june. We will see the next generation of apple software. Cory were also going to see a lot more apps coming to the watch now that we know what its going to look like. Developers will see that and say my device is more likely to get used. Emily cory johnson, our editor at large, thank you. Thank you all for watching this edition of bloomberg west. All the latest headlines all the time on your phone, tablet, and bloomberg. Com. We will see you later. The following is a paid program