Which trains olympians. Global news, 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. Im Alisa Parenti. This is bloomberg. Bloomberg technology is next. Emily im emily chang. And this is Bloomberg Technology. Coming up, paul cant slapped with a massive fine qualcomm slapped with a massive fine. Plus, more highlights from the World Economic forum in davos, including our conversations with bill gates and the ceos of Morgan Stanley and the nasdaq. Intel gets ready to report its fourthquarter earnings. We will take a closer look at the impact to its bottom line. First, european regulators have slapped qualcomm with a 1. 2 billion fine for anticompetitive practices. 201 to 2016, qualcomm paid apple to exclusively use its chips in their products. Qualcomm pushed out rivals as a result. Our decision found that qualcomm cemented its decision by illegally shutting out rivals from the market for over five years. Appealualcomm pushed qualcomm o this decision. The company said, we have a strong case for judicial review, and we will immediately commence that process. Lets bring in editor at large cory johnson. Expand on what the European Commission is saying qualcomm did. Cory the European Commission is suggesting that qualcomm it legally used its market power to pay off apple qualcomm illegally used its market power to pay off apple. Emily why would apple do that . Cory the argument here is that intel, by not having a shot, couldnt have developed a better chip. Go sure the people wanted to at apple wanted to go with the best chip they could at a better price. They were paying off apple to keep competitors out. That not only kept intel chips out of apple phones so many apple phones with one kind of qualcomm chip in it means that two things happen. Qualcomm lowers the price of production. To otherthat shifts phone makers, keeping intel out of the mobile phone business which has been a running, theme for what weve said about intel for the next seven years. Emily they say there will be no repercussions for apple. Why not . Cory apple is getting a lower price. They have decided not to punish apple for being in collusion with this. Were the beneficiary of qualcomms plans. Emily is this something that could they could face a penalty for in the United States . Has taken a much stronger stance in regard to anticompetitive prosecutions. Weve seen cases, particularly against google and now qualcomm, where the eu has taken a much stronger stance than the u. S. Has. Weve seen the eu willing to take on these companies with the notion that competition ought to be better than it is. Qualcomm plans to appeal. How likely is it that would be successful . Cory who knows . Qualcomm is fundamentally built on the basis of lawyers, more than any other big semiconductor. Qualcomm is a company that is fundamentally built on creating technology, licensing that technology, and using lawyers to make sure they extract payment for those technologies. They are designed for a need for speed in the courtroom. Emily what makes this even more fascinating is that qualcomm and apple have recently been at each others throats. How does that play into this . Cory apple wants to continue to get lower prices. Apple wants to continue to fight for the lowest price they can get from any competitor or supplier. They have beat them all up. They will beat up the biggest. Thats where the battle is being waged. Qualcomm is in its own existential battle, trying to fight at hostile a hostile takeover by broadcom. Qualcomm attracts these massive fines. Big problems in pursuing their license agreements. Qualcomm not paying. That has been an ongoing issue for them in china, the most important market for them in terms of where phones are made. Big problems in pursuing their license agreements. It might suggest qualcomms behavior they are so big fromng them separate radcom, they might make the argument from broadcom, they might make that argument. Emily broadcom is trying to buy qualcomm. What does this show for that bid . Cory are they going to have to pay it . Is it going to imperil their business Going Forward . The lower the stock goes, the easier it is for from radcom, they might make the argument broadcom to take over this company. Whether customers will stand for it is a whole different thing. The eu seems to be saying, we want more competition. Selina mer a merged qualcommbroadcom is not more competition. The eu is suggesting they might not be for that for big for that big merger. Emily cory johnson, thank you. The latest revolving door, meg whitman, stepping down at hpe february 1, joining the new mobile Media Business founded by jeffrey katzenberg. Whitman starts as new ceo in march. The company will be based in l. A. And aims to bring quality. Hollywoodquality to videos lookout for new features this spring when apple rolls out a Software Update. What you can expect, next. Technology, five a clock p. M. In new york. 5 00 p. M. In new york. This is bloomberg. Emily emily apple plans to release a Software Update for the iphone in the spring. Animated image he animated emojis, plus a few other features that have been in the works. Mark gurman has all the details. What features are you anticipating the most . Mark this new option to disable the battery throttling feature. Remember the controversy we were talking about . Software update last year that intentionally slowed down older iphones in order to have them not reboot, because batteries, as they age this adds longevity to batteries. Emily a. K. A. , batterygate. Mark whatever you want to call it. Now you will be able to turn that feature off. Emily that means you will what . Mark if you have an older iphone and you dont want it to slow down anymore, you can turn it off. But apple will say youre putting yourself at risk. I think turning it off wont i think turning it off wont expect affect most people in practice, but we will see in a few months from now. Emily there are some new health features. Tell us about those. Mark it allows you to access your Hospital Health records on your phone. Before, you could get your Health Information from the apple watch, from the sensors in already, and thirdparty devices that integrate with things like fit bit. Now you will get information from your hospital, lab results, doctors notes, whatnot, through the health app. There are a few big names across california, new york, pennsylvania. Im sure they will add more hospitals as time goes on. Emily how difficult is it to get these hospitals on board . They need to copy operation the cooperation of the medical field, which has been slow to take on new technology. Mark if you have a doctor in california who has the same server, the same system as a doctor in, say, ohio, you can go andn ohios Doctor Office get all your information, but the key is dealing with different networks. Apple is not going to put a softer update out to 1 billion people that could impede on privacy. Emily new features for reality, correct . Mark they have a arcade 1. 5 have a. R. Kit reality, 1. 5. Say i have an animated version of you and i want to project it on my door. I could do that now. Emily and homepod, which was delayed, is now coming out next month. Mark about a month and a half delay, give or take. Emily not huge, but they did miss the holiday season. Mark they did miss the holiday season. Tim cook told you we would be able to judge it for ourselves in a few weeks. Emily what do you make of the fact that this was delayed . Mark its unfortunate. This is the second year in a row where they had to delay a major new audio product. Two months delay for the airpods, now the same for the homepod. I dont know if this is the start of a new trend for the company. It seems to be isolated to accessories. Every time apple comes out with i feel likeory, there is something going on with their ramp up. We will see if it happens with the next one. Emily mark gurman, thank you so much. Now, to another story we are watching, soft egg is leading another mammoth softbank is leading another mammoth funding round. This time, the investment goes to a littleknown Technology Startup looking to shake up the building industry. A fund which made about 100 investments last year, totaling 36 billion. Joining us now from seattle, dena bass dina bass. This is a lot of money for a littleknown company. Dina katerra is trying to do what they say uber or airbnb did to the hospitality and the taxi industry. They are trying to Bring Technology and software and standard processes to the Construction Industry in an effort to reduce costs, speeds things up. They are doing they basically want to control every aspect of the process, from architecture to interior design, through to standardizing building and construction work on the jobsite, in an effort to make things go quicker and be more profitable. Emily so, what if does this signify for softbank in terms of their portfolio . They have invested in uber and slack. Dina it looks like they are looking for interesting opportunities in a variety of industries that, in some ways, havent changed in many years. Late last year, they made an investment in real estate technology, so that shows an interest in trying to come up with a way to benefit from startups that want to use technology to revolutionize the building industry and take advantage of the real estate and construction boom, the housing boom in many parts of the u. S. Emily what are some of the challenges facing katerra . Dina its interesting. Most people probably havent heard of it, but it has some pretty highpowered backers and founders behind it. Their chairman what he is best known in the Tech Industry for is having built up a company which did something similar in the Electronics Industry to what katerra wants to do in construction. They became this massive company, making Electronic Devices and gadgets for other companies, things like xbox or hp printers. The Construction Industry is similar to the electronic industry. There are a lot of ways in which katerra wants to do the same thing. There are ways it is which ways in which it is much more challenging. The Construction Industry faces a lot more variation than the Electronics Industry in the side. Ing an you have over 1000 100,000ies municipalities with different weather, different requirements. Katerra is trying to preassemble a lot of materials, saying things like counters or cabinets or the exterior and interior wall but they still have to do a lot of construction on site. The Construction Industry is facing a shortage of skilled workers, so thats a challenge for them as well. These projects also take several years. Sometimes they run out of money midstream. Know how, when will we successful softbanks fund is . Obviously, they are making big bets on a lot of companies, really big bets. At what point doing know if this is really paying off . Dina i dont know. They havent even finished off the whole fund. This fund is targeted at 100 billion. They have started making investments. Think itsaterra, i too early to know whether that one company in the fund will be successful. The companys chairman told me they are at 1. 3 billion in bookings, and he predicted it might be 10 billion in revenue in a decade. Thats a huge bet, but it is still early days just for that one company. Add in the other 99 or so companies that softbank has invested in. There are some Big Companies in there, some big names that seem to have a fair bit of success and of the and others a lot of potential. Its a lot of disparate areas as well. Emily obviously, i know we will continue to follow softbank across the map. Dina bass, thank you as always for stopping by. Coming up, more from bloombergs coverage in davos. And if you like bloomberg news, check us out on the radio. Listed on the Bloomberg Radio app, bloomberg. Com, and, in the u. S. , on sirius xm. This is bloomberg. Getting out of the bitcoin business, the Online Payments Company says it will stop processing Bitcoin Transactions on april 23. The company says bitcoin has become less useful, explaining that transaction times and fees have gotten longer for the cryptocurrency. James gorman says bitcoin isnt going away, but he does have some reservations about the frenzy over the cryptocurrency. He spoke to John Mickelthwait at the World Economic forum in davos. Bitcoin is not going away. Its not a fad. But the aggregate market cat market cap of bitcoin globally in terms of you, athey could buy majority stake. Listen, we think we are an important institution, but we dont deserve the kind of price that bitcoin is getting every day. Bitcoin is punching above its weight. It is speculative, filling a need at the moment, but it is not fundamentally you, a majority stake. Changing the global landscape. For the average investor, they are not investing in that kind of speculative instrument. Another big theme youve talked about is automation. All these things people are beginning to ask about. Do you think in Wealth Management and Investment Banking you are relatively safe from that . To the core question of automation and other related topics, i was asked by a journalist recently about how much i focus on competitors. I said, obviously, youre in the same industry, you have some focus, but its not what we get out of bed worrying about. I worry about ai, about automation, cyber risk, digital. All of these new technologies coming to the market at the same time are transforming the way business is getting done. We try and look at each of our businesses, back to your core ,uestion with m a highpriced, highly complex global transactions, it is hard to automate that. Its hard to build an expert system about how to advise aboard. The electronic trading in equities has long been going on. Increasingly in fixed income. With Wealth Management, the evolution of the Digital Space is not new. Since schwab, ameritrade, these firms have been around, they have been providing Digital Transaction and advice for 2. 5 decades. But its going to continue to cause firms like ours to provide both human capability and best in class technical capability. Emily that was Morgan Stanley ceo james gorman. Nasdaq ceo Adena Friedman joined bloomberg, speaking to Erik Schatzker about the Company Working on cryptocurrency futures. Take a listen. With we have been working the industry and with a great partner to look at whether or not its the right thing for us to do. And i think that we are still evaluating that. We have been talking with the industry to say, is this something we have two Bitcoin Futures out there. Is there something different, a different construct . Would that be of interest to you . Would there be demand . If youre going to create a product, you want to know that people are going to use it and use it to differently than how its being used today. We have to selfcertify as a Futures Exchange for this. We would use our slices to do that, but we have to make sure, from a Risk Management protective, we are fully prepared Risk Management perspective, we are fully prepared. Appealing,it seem, regardless what you think about crypto as a meeting medium of exchange or a stored value . Adena i think Digital Currencies and cryptocurrencies will have a role in the global economy. The question is, will they mature to a state used for the transfer of goods. In the meantime, there is a lot of demand out there for that indicative price and that ability to trade it. Its a matter of can we create a construct that is unique enough and different from whats already there. Erik would you think about providing a futures contract for something other than bitcoin . Two exchangee traded notes listed in our nordic markets. Thereum. Other is bitcoin. Holistically,more not just that one. Emily that was nasdaq ceo Adena Friedman in davos. Broadcom created the potential for a giant in global chips. We will discuss the impact on apples supply chain. If you have a holistically, not just that one. Emily that was nasdaq ceo adena bloomberg, check out the bloomberg terminal, tv. Watch us online, click on our charts, and interact directly with us. Go to tv on your terminal. Contact us on twitter. Byck out tick tock bloomberg. This is bloomberg. Alisa im Alisa Parenti in washington, and you are watching Bloomberg Technology. Here is a check of your first word news. Willrump Administration Delay the release of the fiscal year 2019 budget until february 12, a week later than expected. The budget typically arrives in congress by the first monday in february, which falls this year on february 5. Blamed the Government Shutdown for the lost time. A court in brazil voted unanimously today to uphold the corruption conviction of former president lula. Fromuld prevent him participating in president ial elections scheduled for october. Lula leads the polls by a wide margin. His lawyers are promising to appeal. Declaring that france is back, Emmanuel Macron argued it is up to