Tencents blowout earnings. Sales jumped more than 60 in the last quarter. We will discuss the secret to the companies continued success in asia, and its u. S. Ambitions. Uber has set the stage for one of the biggest private startup deals ever. The service has approved softbanks offer to buy a 1 billion stake. Softbank and other firms will be allowed to invest up to 1 billion in uber, and can buy out up to 9 million in shares. I caught up with cory johnson and Bloomberg Technologys eric newcomer. We have basically everything except the price, which is key. And who the sellers are, we dont know that for sure. Therefore, we dont know the total amount that is up to be bought. But we have sort of a slate of governance reforms, and we have softbank, dragon year and a , number of other potential buyers. But the thing we have been negotiating over for the last many weeks now if those governance reforms and also sort of the process by which softbank would buy the shares. Emily so, talk to us about some of the governance reforms. There were some contentions over Travis Kalanicks role. He made some compromises and benchmark made some compromises. Tell us about those. That travistest is wanted benchmark to put their Fraud Lawsuit against him on hold, and agree to end it at the end of all of this once governance reforms goes through. Benchmark has been unwilling to put it on hold, and really commit publicly that there was going to be any sort of ending of a lawsuit. They came around, and travis agreed to give the board sort of the approval. The board has majority approval if he replaces his own board seats that he failed sort of going for filled sort of Going Forward, so that was the major compromise. Emily cory, what is your take on the hurdles that remain . Cory the way to think about this is in terms of the ipo for the longterm shareholders. This will allow a lot of the longterm shareholders to get out of 8 billion worth of stock. So, but it also really clears up the Corporate Governance questions of who owns what in the company, and what classes of shares of stock may be offered in an actual ipo, in an actual public offer of those shares . Not only would softbank be buying 8 billion worth of shares, but by clearing up the governance structure, which is something that a lot of companies do getting closer to ipo. By doing that it sets the stage for these guys to go to the public markets. I think interestingly, in this sort of marginality, between the lines and eric newcomers wonderful story on bloomberg. Com and the bloomberg terminal, is what we really see happening is with valuation. Softbank has agreed to pay a higher valuation for its first bunch of shares, and then the subsequent shares from existing shareholders. Which is to say, the existing shareholders could say they are paying what everyone else is paying, but they can dribble down to a lower cost to acquire more shares. So softbank is getting the best of both worlds, and the valuation of uber doesnt officially decline, but the overall valuation will decline if existing shareholders sell that top 70 billion market cap valuation. Eric we will know it is less. The blended valuation will probably be lower. We are already seeing the positioning. We had an investor reach out to say, you know, this cannot be too low. And softbank put out a statement sort of saying, this is not done yet. The price positioning is really beginning and that is what cory said. You know, this isnt the last round price. And how low it goes will be a major point of contention now. Cory but here is why that matters because the reason that matters is because what matters is what the valuation is officially set at. If there are ratchet deals, if some of the investors have deals as we have seen in so many ipos where a lower valuation issues more shares automatically, a cascade of shares to anyone that invests before the last round, they would have to do that. They can sort of say, hey, the official valuation has not gone down. So we dont have to issue more shares. There is no ratchet trigger, no devaluation of earlier shares. They wont have to flood the market with new shares as existing investors because they lowered they valuation. The blended valuation will be the official valuation. We will see that in the paperwork. Emily obviously, eric, a lot of Unfinished Business here, but once softbank is officially on board, what can they contribute to uber as a Strategic Partner . How can they help them you know, moderate some of these issues they are facing abroad . Eric hopefully for they can one, stop investing in ubers competitors. I think they would appreciate that. And i think the dream is that softbank can help broker peace in india or Southeast Asia where it has investments and grab. So, that is the hope. I mean, that is not an explicit part of this deal, but i mean, softbank has invested everywhere, and it is in everyones interest, except probably lyft, to see a Global Alliance and the cash burn goes down in india and Southeast Asia. And companies can find a way to profitability. Emily Bloomberg Technologys eric newcomer, and our editor at large, cory johnson. Well, another ridesharing startup making news lyft is rolling north. The Ride Hailing Company will launch in toronto as well as hamilton ontario starting next , month. Lyft is pushing into a territory long occupied by rival uber. About 50,000 toronto residents have downloaded the lyft app this year, even without Service Available yet. Coming up, qualcomm rejects broadcoms history making 105 billion offer. What is next for the potential megachip deal. And how apple plans to ramp up its efforts. This is bloomberg. Emily this week, qualcomm broadcoms 105 billion dollar offer kicking off what , would be the largest takeover battle in history. What is next . I posed a question to bloomberg tech reporters, and bloomberg deals reporter ed hammond. Ed what is really interesting is we know that broadcom was going to get pushback and they knew that as well. The fact that qualcomm rejected, and on the price, saying no way this deal would ever get done. That was actually seen as relatively positive by the market. You saw that reflected in qualcomms shares, which has initially gone down and went up when the bell opened. What happens next will be really broadcoms call. They have shown already a willingness to go directly to the shareholders and go hostile. I think we see a continuation of that strategy. They are probably going to launch a slate for the qualcomm board. I think they have to do that sometime by december. Then it remains a question of how much money can they really put on the table . Almost certainly they will go above the initial salvo of 70 a share. Some talk around whether they could go in the mid80s, maybe even 90 a share, but a lot of that depends on the feedback they are going to get now and when they next make a move from qualcomm shareholders. Emily if you want to keep negotiations friendly what , happens now . That is a very good point. The assumption by the market is this is just about price. If you look lower down at that statement, there is a fundamental difference in how you run a chip company. They say the good times are over and no more growth to be had. We need to batten down the hatches. Qualcomm Still Believes it can grow and move into new areas and that is absolutely not what he does. Emily he has gotten a lot of what he wants lately. Could this be the one thing he cannot make happen . Ed it is the biggest thing he has tried. Look, everything he has done, emily, has been friendly. This guy is a deal machine and built this company up through acquisitions, most notably the deal with broadcom. This is a hostile, a different order of magnitude from anything he has tried. I think even if he does get the shareholders of qualcomm on board, which is entirely possible, i think one of the real issues will be whether or not this passes muster with the regulators. You are seeing qualcomms existing deals they are trying to put through in europe is being held up by the e. U. , who is taking a very careful look at this. Even if this deal gets over the line in terms of the companies deciding to dance, whether it gets through the regulation hurdle is another story. And one that will play out over years. Emily ian, how much is qualcomm really worth at this point given the headwinds it is facing, given the potential of losing apples business . Ian it depends on who you believe. If you believe qualcomms management, it might get a bit of time. We go back to this lucrative licensing model. Get that extra 2 billion of revenue a year. It is worth much more than this, especially if you bring in xp. If you believe the detractors, they are worth what qualcomm would want to pay. Emily now to a bloomberg scoop. Apple is planning to take another step towards turning the smartphone into an augmented reality device. According to people familiar with the matter, apple is working on a 3d small rear facing system for the iphone by 2019. I spoke to the man behind this the scoop, alex webb, and our editor at large cory johnson. At the moment, what you have at the back of the phone, is two cameras if you have got the iphone x. It is not terribly accurate. What apple is looking at doing is the 2019 iphone, adding the depth perception on the back, which allows them to do a lot more complicated, augmented reality things with the rear facing camera. Emily would this impact any of the current technology, the face id, or is this something completely separate . Alex it is something separate. If you are a laser maker, it is probably good news because there are two lasers on the side of the screen, which allows face id to work. There would be another one on the back. The example i think of is if you take a monopoly board, a virtual monopoly board, you can play virtual monopoly on this table with the ar kit. If you put your hand in the field of view, it does not know there is a hand there, and ruins the illusion. Adding a 3d sensor can allow you to pick up a virtual top hat and move it to the next space. It would appear like that on your screen. [laughter] cory i want to hear him talking about english monopoly. Emily it is not surprising apple would already be pushing forward on technology one, two, three generations out, but what do you make of this knowing what we know now about apples broader ar strategy . Cory well, i think apple looks at what has happened in the pc industry. We have seen people just decide that we have gotten to a point in pcs where there is no compelling reason to get a new model every year or every other year. And the replacement cycle has slowed down for pcs and tablets. We see people replacing their tablets, but at a much slower pace. And they are worried about that in the phone business. People want to get a new phone after the 18 month or 12 month period, but they dont want to slow down and they need to find something compelling enough to get people to want to upgrade their phones. And this is that kind of thing that is a big leap in one direction. Alex i think the thing is interesting in that particular context is there are two production from out at the moment that have this kind of technology already. Kind of shows apple is taking the advantage because it wants to milk this cycle and the next cycle, rather than bumping all the technology into the phone as soon as they can because it leaves them little to room to advance the next generation. Emily apple working on ar headsets. How does this tie into that . Alex it can be seen as a Foundation Stone in some ways. We have seen their ar kit and there are increased numbers of augmented realitybased apps. The problem with augmented reality glasses at the moment is there is not a huge amount of content out there, which makes it worth people buying. Now if apple is building a whole Ground Foundation of ar content, hopefully they would parlay that into smart glasses in three or four years time. Cory they have the ability to do a lot of things with ar using air pods as well. This augmented reality stuff with the air pods with some kind of glasses as well could be somewhere they go. I think the fundamental of this is one of the development tools. If you think about what they do with pokemon go, it was really groundbreaking stuff, but they had to build that from the first ones and zeros to the top. Now, developers can get a head start and we might see real advances quickly. Emily new technology can be hard to imagine how you would use this. As with pokemon go, if somebody explained that to me, i do not think i would have understood it until i played it myself. Cory now you cannot quit playing. Emily alex, give us some ideas about how i as a regular user might benefit from this kind of technology. Alex ikea, which has an augmented reality app, it allows you to place a virtual sofa in the image of your living room, i and walk around and see how it might look. What it cannot do is hang a mirror on the wall, or a picture on the wall. It is very good dealing with horizontal planes. It is not as good dealing with vertical planes. It adds that some of perception to it. You have seen the walking dead cap where you see zombies Walking Around your living room. The moment a person approaches a zombie does not know the person , is there anything place an interactive thing with your friends saying hit them in the face or god knows what. Emily bloomberg techs alex webb and editor at large, cory johnson. Coming up, our interview with will hearst about his decision to launch a brandnew print magazine in the era of digital complications. And later, amazon takes ai to a whole new level. The tech titan prepares to launch the first Cashierless Convenience store. This is bloomberg. Emily vanity fair has named its next editorinchief. Rudica jones comes from the New York Times, where she served as the editor of their book department. She is well known in the literary community, but lesserknown in hollywood. She will be the first fema editor of vanity fair since tina browns tenure in the 1980s. Staying with media, william hearst, iii has unveiled a new magazine called ulta. It focuses on culture, politics, and the big issues impacting california. But traditional print publications have been facing headwinds, to say the least. Just last week, conde nast announced it was closing teen vogue and limiting other monthly issues, like glamour. The publisher, whose family has had a legendary place in journalism from more than 130 years, sat down with us to discuss the current state of media. William i think, when you are starting a new business venture, particularly something in the area of culture and the arts, you dont want to be in a super crowded field. So i think announcing a new blog or new website, we would have been lost, whereas a publication has a certain permanence, it is quarterly, so we dont have to keep up with news. We kind of reflect on things that are happening. I was modeling what we did with a little bit of vanity fair, and a little bit of the new yorker. They come out more often so they have to stay closer to the news. Whereas, we are interested in things that last a longer time culture, politics, technology, trends, larger scale movements. And we just thought print would be an easy way to do it. Nowadays, a print publication is mostly electronic anyway. All of the editors work in different places. The copy comes in electronically. The printing is just the last step in a process. So, we are very ready to do anything we are doing in the Magazine Online almost simultaneously. Emily so what do you think is , the state of the magazine business business as budgets are business as budgets are getting cut, people are being laid off, magazines are being canceled . William well, it depends on what you are doing, you know . If you want to do a mass pop magazine, i think it is very difficult because that group has moved largely to the web. But if you have a very focused audience and delivering something of value to them, like the economist, i dont see that as a failing business. The New York Times has had a giant search in attention because of the interest in politics. The Washington Post, i remember when jeff bezos bought it, most publishers were thinking he had a secret technological idea. Something to do with molecules and transistors. And jeff bezos had an unusual idea run it like a newspaper. Report the news, get it straight. Underneath the nose of the Washington Post is washington and politics. The Washington Post newspaper in the old days sort of wanted to be the New York Times. They were opening bureaus in singapore, trying to cover the world. And they were a little bit disdainful of something as greasy as politics. And under bezos, they are covering what is under their nose. Washington to cover politics, San Francisco should cover technology. If youre not covering what is under your nose and trying to be someone else, youre entering a crowded field. Emily what you think of Radhika Jones as the new head of vanity fair . William it is an interesting choice. It is kind of a literary choice, i think a book choice rather than a popculture choice. I will be interested to see what happens there, but i suspect they will continue to have very good writing, very good photography, and maybe a little more culture, and a little less politics, but that is just a guess. Emily great in carter obviously Grayden Carter took a very tough stance against president trump. You wonder what voice she will bring to the Political Part . William she knows how to mine old criminal cases and modern stories and meld them into a unique conversation conversation. I think graydon himself thought that things were changing. Emily right, budgets are getting cut. Maybe the big, glossy pages, maybe they wont survive, we dont know . What was your advice . William they were also lifestyle issues in the conde nast organization. Big black cars for everybody, fancy restaurants. The Hearst Company is in the magazine business, too, and we run a little bit more of a businesslike operation. I think that is where conde nast will trend, because they have to. It is a