Spreeor the buying during chewing dotcoms first day of buying has really been seen since the 2008 crisis. The u. S. Justice department is nearing approval of tmobiles 26 billion merger with sprint. This is according to the New York Times. A group of states sued to block the deal claiming pressure on the Justice Department. Our reporter joins us from new york, what do we know . Has been the doj continuing negotiations with sprint and tmobile about how to approve the deal. Sprint and tmobile have promised to do vest a number of assets that include the prepaid phones. Also some spectrum assets to the sec. The doj torking with potentially offload some other assets. They have a list of buyers the doj would be comfortable going to. Sprint and tmobile are working with them, that includes dish and others. For ahe doj wants is fourth carrier to be set up out of this deal. Even after sprint and tmobile merge, which would take the players in the market from four somebody the doj want to provide vital competition to these guys. Emily how would the fourth carrier work . Would the fourth carrier actually stand a chance . Spectrumhat is why assets are being discussed as something these companies have to divest. The doj wants them to pave the way for a competitive fourth carrier. That is why you see someone like dish in the mix. They already have national infrastructure. They would be more able to build a new network. Dish already has a lot of spectrum as well. The doj is leaning towards buyers who could provide this kind of competition. Emily thank you so much. The u. S. Government is sharpening its antitrust scrutiny of big tech. Could bequiries forthcoming, the Justice Department and ftc have divvied up antitrust oversight or apple, amazon, facebook, and google. Tech leaders are stepping up lobbying efforts. Apple ceo tim cook visited the white house to discuss efforts to develop job training programs. Google ceo touted creating jobs at an Oklahoma Data Center to cnn, arguing bigger can be better. Mcnamee from roger washington. You have been liaising with some of the people who will make decisions, what is your argument to them . Of thethe tone government has changed so dramatically in recent months. I think there is an awareness especiallythat google and facebook but also amazon and apple have issues that really are bad for the economy, competitors, and bad for consumers. You see all of the big four being investigated at the moment. The cases are very different. The one against apple i think is trivial. It relates to the app store and i think could be resolved by them changing the way they price to the developer. The one at amazon is more structural. I think amazon provides a really valuable service in a way that will survive antitrust investigation, even if they have to make pretty profound changes. Google and facebook, the google is completely different. The issues go to the heart of the Business Models. There is no easy fix. That doesnt mean the antitrust investigations will lead to actions. The investigations are going to look really seriously at ways to force change in the Business Model. Emily all we know is the doj and ftc have divided oversight over possible investigations. What is your sense over the investigations and if they will actually happen . Roger i am obviously not in a position to know the answer to that question. I surely would love to know the answer. Here is what i believe. There are signals coming out of ftc relative to facebook that are inescapable. We have heard indications that it might be a 5 billion fine, there would be other actions resulting from the violations of the Consent Decree from 2011. There is more evidence as we saw earlier this week, the wall street journal reporting that there might be evidence that Mark Zuckerberg knew about the privacy violations taking place. If that evidence proves to be valid, this situation i think has become more extreme than even what has been discussed. I dont think a 5 billion fine will move the needle on facebook. I think the market has discounted that. We shouldnt assume that is all there is on that case area on google, we are earlier in the process. The situation is very clear cut in two different ways. ,oogles monopoly in search advertising, and on android are so powerful and so obvious that it is really impossible for me to imagine the department of justice wont initiate some kind of investigation. We have to see where that leads. Emily lets stick with facebook. What do you think would move the needle . Obviously cofounder chris hughes , one of the earliest employees at facebook has argued for breaking up facebook. Sheryl sandberg has impart responded saying china isnt going to break up its big tech companies. Same argument to cnn, bigger can be better and more successful. Pretty obvious that bigger has been fantastic for shareholders. In terms of broad competitiveness and especially innovation, big has been a disaster. The Silicon ValleyEntrepreneurial Community has seen its entire world distorted. You have to avoid every startup has to have a plan to avoid google and facebook. It has driven a ton of money into businesses that are more capitalintensive Like Services your parents used to provide for you. And probablyk lower returns like crypto and transportation like scooters. For doing an investigation is clear cut. I think the china rationale is nonsense. Thee i think that regulation needs to go two ways, you need antitrust to improve the competitive environment. I would look to the way at t was handled where the patent portfolio was put into the public domain. They were restricted to a space smaller they really competed in. Their own infrastructure was used to create competitors. All of those work here. You also have to go after the core Business Model. You have to go after what the harvard scholar calls surveillance capitalism. This notion that these companies or throughacquire surveillance capture and data avatar. Really a date a voodoo doll for each person in the population. They use that for their own gain over the objections or without the knowledge of the consumer. That Business Model is extremely dangerous. We are going to need a different kind of regulation. One that is new to this kind of economy. It will probably take a while. That is a very important thing to do. I think regulators are aware. Is one thing,ion a breakup is another thing. Do you think facebook and google should be broken up . If so, how . Roger i think there are lots of ways to look at this. Most of the discussion to date has been about the merger activity that shouldnt have happened. Therefore, unwinding things like instagram and whatsapp. Unwinding the mapping products at google and some of the other things google has acquired. You have to look at all of the alternatives. When they broke up at t, they broken up horizontally, by region. You have to look at every possibility. At the end of the day, breakup will not be helpful if you do not go after the Business Model. What the professor calls surveillance capitalism is itself a very severe problem for the economy and especially consumers. It is the reason why we face threats to public health, democracy, privacy, and competition. You have to go after that. You cant just break them up and leave it alone, you have to do with the Business Model. Emily roger, you are sticking with us. We will be talking more about this through the halfhour. Coming up, perhaps no industry has more at stake than semi conductors in the u. S. China trade war. We are already seeing the impact of the cut sales outlook. Shares are plunging. We will discuss next. This is bloomberg. Plungedroadcom shares to 5 wiping out most of this years gamin. Other chip stocks went out with it. Broadcom was a major supplier to huawei. The chipmaker also provides chips to apple, which could be under threat of president after the g20. For more on the impact we are joined back again by roger mcnamee, cofounder of Elevation Partners. Nobody knows what President Trump is going to decide. Based on what we know so far, how devastating do you think this dispute is going to be for u. S. Companies . Roger the problem with this whole thing is we have no visibility. There is nothing about this trade war that makes any sense at all. We have the extraordinary, symbiotic elation ship with china. It was based on a goal of giving consumers the broadest possible choices in product at the lowest possible price. Overlook atext we lot of espionage and clear manipulation of markets that was detrimental to some american vendors. It worked out great for tumors. To me, it is ok to make a change in that larger context to say we are going to optimize the needs and will tolerate some price increases. That is not what is going on. What we are going on is selfinflicted. We are unwinding globalization. We are unwinding this constructive symbiotic relationship without replacing it with something we understand no one can plan for. I look at this and see nothing but downside. In my mind, i dont know what huawei is going to do. This will engender competitors to broadcom. Maybe it doesnt last that long but people arent going to look at trade with the u. S. The same way after this. They will need to. They will have more leverage for negotiating. What a waste. Emily the skeptics would say the trade relations with china have been very unfair, stealing intellectual property from the united state. They have been the benefactors of a massive trade deficit that the u. S. Has suffered from. Does something need to change . Could that change perhaps be better than the change that the administration is pushing now . Roger lets unpack that. The first part of it is it is demonstrably true that Technology Vendors in particular have suffered a lot of industrial espionage. Some brands have suffered from counterfeiting. Obviously has been a prioritization of the needs of consumers. You going to walmart and 90 of the products are made in china at incredibly low prices. If we are going to move off of optimizing for consumers, that is totally rational. You want to do it with a clear plan that everybody understands and agrees to. China understands and agrees to. Have thectly happy to conversation about reoptimizing for american corporations over American Consumers area what im not prepared to do is buy into the nonsense that the trade deficit is a problem that is what drives the incredibly low inflation we have had for so long. It is about the fact that we have this symbiotic relationship where we use our capital, our highvalue currency. We use our vine buying power. We take advantage of china investing a ton of money and infrastructure. If we want to change that, lets do it with a plan, not with kneejerk activity that leaves businesses with no way to plan and consumers with higher prices and event. Emily lets talk about apple. Tim cook was meeting with the president this week. There has been this threat of tariffs on apple products for many months. It has not really hit apple, yet. There certainly could be a sentiment change in china where chinese consumers decide not to buy apple products. Said they could manufacture u. S. Pound i found iphones outside of china. You have analysts saying a potential hit has already been built into the stock and if the trade war is resolved apple could bounce back. Roger i think this is a really important set of questions not just for apple shareholders but everybody in the tech sector. Apple took a massive hit just a few months ago. The business in china for iphones has slowed down dramatically. You have to believe there is no way it could read on as hard. It is what it is. Smartphones are mature, they will not come back. Apples best opportunity in smartphones is to convert form from selling them to be 1000 apiece, to be a subscription where you pay monthly. They have the Balance Sheet to do that. I think that would allow them to gain a lot of market share. That is the single biggest thing for investors to look for. I have no reason to believe it will happen or not happen. It could happen and is really a logical thing for apple to do. It is so hard for android to respond. Relative to apples other things going on, apple has done a really good job of maintaining good relationships with the Chinese Government and with our government. I think apple has worked really hard not to be a source of conflict for anybody. There is no way they can of a change tsunami in trade strategy from globalization to nationalism. At the moment, we are heading in that direction. That makes beaded me very uncomfortable. Emily we will be talking more about facebook in particular after the break. Facebook saw a pop in shares on friday but the company is still facing a losing battle despite the spread of its misinformation around the globe. This is bloomberg. Emily emily as we head into the 2020 election facebook is facing controversy over fueling hate speech in myanmar. Ignored it over suggestions it was leading to violence. The New York Times reports they have spread to india, where facebook has 340 million users. All of this impacting recent elections. Cofounder of Elevation Partners roger mcnamee, this is a prom you been talking about for a long time but this latest of this onehe hate particular group has spread to india has impacted elections. Some of the stories are incredibly horrifying. Facebook says it has stepped up efforts to combat this particular issue. Have you seen much progress . Roger the really sad thing is there has been no substantive progress on any of these issues. There is a basic reason why. Facebook and google are in the business of first gathering our attention and holding our attention. It turns out for most human beings, the things that stimulate our engagement and keep us active and emotionally stuffd on context are that appeals to our lizard blade brain, hate speech and conspiracy theories are amazingly constructive for the Business Model of these companies. This is why they go out of their way to say things that make it sound like they care deeply. They move very slowly on substantive change. There is no way you could use moderators at the scale of facebook or google to protect users. You have to change the way that the algorithms work. You have to recognize that it is not a freespeech issue we are talking about. It is an issue of amplification of the worst voices in society. They have the means to do this. For business reasons, they have chosen not to do so. They keep hoping that the fear and anger that we all feel over these things will pass. The problem is, there is just too many of these stories. Every day is something new. They cannot help themselves. They keep stepping in it. Emily this deed fake video issue seems to be getting under the skin of congress, nancy pelosi hasnt returned a couple of calls from Mark Zuckerberg. Spoofed markave zuckerberg in a deed fake video. Both of these videos they said we will leave this up. We will do you prioritize it, flag it, is this a different issue . It is part and parcel the same thing. It is completely ridiculous area their position is indefensible. What we are talking about with deep fakes is context that has no social purpose. In thehan Princess Leia star wars movies, i dont know if there has been a constructive use of a deed fake. I dont understand why Stanford University and other places develop this stuff. This is like human cloning. It is obviously a bad thing. Peopleld not be enabling to develop this. We surely should not allow platforms to host this. Right now, the platforms are saying you should only regulate the people who create this stuff. That is nonsense. The platforms have to be responsible. If they dont have an incentive it will keep coming back. It is really hard. They will have to put their best people on it. I view this like Chemical Companies in the 50s which work amazingly highgrowth and profitable. They could pour waste products, mercury and other things like that to pollute freshwater without any cost or consequence. What is going on with google and facebook is they are creating digital spills because they dont have to pay the cost. It is way past time to make them pay. They still do dumb stuff. Facebook released a product called study where they pay people in order to spy on them. Get a grip. That stuff is totally inappropriate. I have about a minute left but i have to get your thoughts on facebook potentially launching a new cryptocurrency. How optimistic are you about it . Roger what could go wrong . Cryptocurrencies have had all kinds of issues. Coins that disappear, fraud, all kinds of challenges. People ofbelieve the facebook are smarter than the people that have done crypto elsewhere. This Company Needs another like itry more ash needs a hole in the head. Their ability to understand this ,s a time to clean house einsteins definition of insanity was doing the same thing over and over and expecting a different result. Emily running into a commercial break. Would love to continue this conversation but we have to let you go. Thank you so much. We will be speaking with facebook coo Sheryl Sandberg next week. Tune in the Bloomberg Television for that. We will ask her some of these tough questions. This is bloomberg. Emily this is bloomberg technology. Continuing our look at the u. S. Government versus huawei. The Trump Administration assured Congress Federal agencies will meet on the band with deals. That means the government cant enter into contracts with huawei or buy from them. This deal prohibits those bills was passed in 2018. I support that decision because i think this is a Critical National security issue. In all my conversations with the intelligence community, they made clear that if huawei is allowed to dominate the 5g infrastructure, the future around the world, that will compromise our National Security intere