Drive global trade. Problem. Ids, a the vast majority of children are not watching. The Smartphone Market taking a huge hit in the trade war. Apples iphone could be seen weaker than expected demand, especially in china, and huawei gave a doomsday estimate for smartphone sales. The company is ready for a drop of up to 60 in International Smartphone shipments. Founder expects to revenues by 30 billion to slash revenues by 30 billion over the next few years. International shipments that go outside of china account for about half of Huawei Smartphone sales, and that is a chunk. He talked about the revenue hit. They dont want to resort to mass layoffs, they dont want to sell off parts of the business, and they dont want to reduce research and Development Spending it people close to the spending. People close to the situation tell me they have been looking for that dropoff in smartphone sales. This is something weve been talking about, talking to partners, customers across europe, saying theres a dropoff because people dont know what will happen in this company and what does it mean to me if i cant access Android Services and products on my smartphone . It is a big deal in europe, which was a big growth driver for them outside of asia. Emily huawei sales account for about a third of the Smartphone Market. Could they make up the shortfall in china . Mark it is possible. If we believe people in china will stop buying smartphones and products from american companies, those sales will have to go somewhere. It is possible huawei could pick up a little bit in china but i dont think the differences will be too drastic. Have ameantime, you number of analysts coming out with grimmer outlooks on iphone sales, not just because of china but seemingly globally. What are they saying . Mark theres a lot of speculation, not only because of trade war with china, about iphone sales, analysts and investors not being us optimistic. Apple used to come out with a big iphone redesign every two years. But we have seen in the last few years, the changes yearoveryear have not been that dramatic. What we will see for the new iphone coming out is a design the same as this year and the one before that. E are before that the same asng about 2017 and 2018. Software updates are making are available to more and more older devices. The combination is not lethal to apple but it does pose a longterm challenge. Emily obviously there is the greater Economic Uncertainty that is affecting the entire Smartphone Market in general. Tom the trade war is taking a toll, and you are seeing in different ways. Chipmakers, their products. Theres concern about the 5g rollout. We are on the cusp of this massive technological upgrade where we will have this ubiquitous internet service, the internet of things. Huawei is a big provider of that equipment. To the extent that you will see people cutting back on purchases gear, that slows the rollout of 5g and of services, hardware, other things that will be accompanying that rollout. Mark, asterestingly, you reported, apple wasnt planning to reveal a 5g iphone this year. Huawei is the leader in 5g. Couldnt that have given huawei market . In the mark thats a good point. Apple is one of the biggest phone makers in the world so apple not coming out with a 5g device is going to mean that some components makers, partners, arent going to rollout new things to be competitive with 5g until apple is there. I think this whole 5g push will 2020. ,ven bigger deal in 2021. Way was planning to huawei was planning to unveil a foldable phone this month. They have delayed that seemingly delayedsamsung has their foldable rollout due to issues with the screen. Mark huawei was planning to launch a foldable phone soon but they saw how samsung essentially embarrassed itself by launching a phone worth 2000 that by removing the Screen Protector can damage the phone. Huawei is taking a different approach, waiting the extra few months to see if they can mitigate any problems, probably using the next few months to put it through further testing, and then they will not launch the device until it is ready. Right, lots to continue to follow. Andmberg techs mark gurman tom giles, thank you. A new china region chief. Stanley chen, former general manager of google in taiwan will take over running operations in china. Google takes in about 15 of its revenue from the asiapacific region even though it pulled its Search Engine from Mainland China and 2010. Coming up, Companies Looking for a backup plan for the trade war. Intel ceo bob swan looking at the Global Supply chain. If you like bloomberg news, check us out on the radio, the bloomberg app, bloomberg. Com, and in the u. S. , on sirius xm. This is bloomberg. Emily intel is reviewing its supply chain amid growing uncertainty with the u. S. China trade war. In an interview sunday, ceo bob swan said he is encouraging both companies to engage in dialogue to mitigate tariffs on phone companies. Bob we have a lot of customers there, a factory there, lots of brilliant engineers in china. It is a good market for us. Weve been focused on encouraging the governments on both sides to engage in constructive dialogue. We do not believe tariffs is an effective way to drive global trade. That is where we think we can have some influence. We obviously dont have control. What we try to do with our customers and partners is try to mitigate any consequences of tariffs that could be in place that impact the free flow of goods around the world. Our customers need product and some of our Global Customers have big Assembly Operations in china. We need to work constructively with them to mitigate these. These implications. Your peers like google, starting to shift production out of china, apple with some kind of plan b in place, intel isnt considering in the back of your mind a backup plan should something happen to shift some of the production out of china . Bob in light of tariffs, we need to think through with our customers and our own operations how we mitigate the effect that tariffs or anything else could have on our businesses. Higher tariffs ultimately end up in higher prices for consumers around the world. We work to mitigate those. You are not there on thinking of shifting anything out, or you are not worried about a backup plan. You are focused on mediating . No, i think there are multiple things going on. We are working with the governments to encourage them to get to a resolution. Secondly, weve been working since the tariffs started last year both with our manufacturing operations as well as the Assembly Operations of our customers. Weve been working to mitigate the impact for more effective ways of the movement of goods around the world so our products will be more expensive will not be more expensive at the pointofsale. Mitigate . Es it mean, bob products assembled in china and shipped to the u. S. Mitigate means, how do we move goods . Sometimes our customers move their operations. Less product coming from china to the u. S. That will be subject to tariffs. Mitigate means at we work with the Global Supply chain to reduce the impact of higher costs arriving at consumer shelves . So that does involve some moving around . Bob absolutely. Moving on to economist cars. Today, i think you took your third ride in the Autonomous Car and tried a new system that will be part of a ridehailing service. What are your thoughts . Bob i went on the streets of jerusalem, traffic going both ways, the on and off ramps, people walking across the street, and doors opening. To watch how far mobile Eye Technology has come. The gentleman behind the wheel that took me on the drive, not once did he have to put his hands on the wheel. The most impressive thing is to see how far they have come in each one of the successive drives i have gone on. Believe announced i last year that they plan to rollout a ridehailing service. What is going on with that and when can i hail down a cab . Bob last year, we announced with volkswagen and champion motors that volkswagen would build a car, mobileye would build the Technology Inside the car, and champion motors would help assist with the Technology Inside the car to bring the services here to israel in the 2021 timeframe. We are extremely excited about what that means about bringing safe security to address two fundamental problems on the highway in jerusalem, traffic and safety. We think we are going to the able to deploy Mobility Service over time here and then expand to the rest of the world. Emily for more, i want to bring in bloombergs ian king. First, what he said about china. How big a hit will this trade war be for intel in particular . Ian intel is one of the companies absolutely in the crosshairs here. China is the largest market for computers, semiconductors. What he was talking about with mitigation is basically stopping that china to u. S. Import, or minimizing that as much as he can. Intel has plants in this country, assembly and china, devices it is going to in china. It is really difficult so that is why he kept saying, we are looking into it. Nobody knows the answer. Emily are they able to redivert, redirect . Goes on inof what china cant easily be relocated and why should it be if a large part of your market is in china as well . Emily robo cars, how important could this be to intels business . Ian mobileye has been a bright spot for them. It is something they have spent a lot of money on. A lot of cars on the road with mobilEye Technology. At this point, it is still a relatively small business, still only a few hundred Million Dollars per quarter. Emily if these cars take 10 years to get to market, then what . Concernt is the overall not just for intel. Is this market going to develop as fast as they want it to . Emily how are their efforts in self driving cars compared to other chipmakers . Ian they are on the road. A lot of other companies right now are talking about test programs. Intel got in early, the drivers assistance level. They are generating data, generating experience. In that sense, they are ahead. King, bloombergs ian thank you for that extra context. Coming up, amazon is sharpening its approach into the 130 billion videogame industry. And bloomberg tech is livestreaming on twitter. You can check us out technology. This is bloomberg. Emily apple ceo tim cook gave the commencement speech at stanford over the weekend. While he discussed the virtues of Higher Education and stanford in the tech community, he also doubled down on his critique of some of the biggest issues facing big tech right now. Tim every data breach, every privacy violation, every blind eye turned to hate speech, fake news poisoning our national conversation, miracles in exchange for a single drop of your blood. Too many seem to think that good intentions excuse away harmful outcomes. Whether you like it or not, what you build and what you create define who you are. Emily meantime, at a time when most tech giants are jumping in to the videogame industry, amazon is finetuning its approach. According to the wall street journal, amazon laid off several dozen employees to its division that develops video games. It is struggling to develop a blockbuster game of its own. Many people may have not quite realized that amazon is working on its own Blockbuster Video games. What happened here . Matt they have been developing a couple of games internally for several years. A lot of those are sticking out into beta but none of those have been fulltime releases. I think they see value longerterm in cloudbased game streaming but they also understand, to be successful, they need exclusive content, so they are trying to build out their own content so that when cloud streaming is real, they will be able to compete in that market. Emily how significant are the layoffs . Matt probably insignificant. In the videogame industry, for every game that gets released, there are probably a graveyard of dozens that never get seen. This is just the nature of the creative industry. You have a lot of projects and you have to cull them early in development if they are not going to be successful commercially. Emily we know that amazon bought twitch. How has that been going and how does that fit into what amazon is trying to do . Matt they havent architected what they are trying to do. It is still the biggest livestreaming form for gaming. Will basicallyey make it a way where you can buy games while watching somebody play and then jump right into them. Google is trying to do exactly that with stadia and youtube gaming. Amazon is in a good position because they have the eyeballs on twitch. Over the next few years, amazon and google will try to take a slice away from microsoft, sony who control the console industry. Emily even if they havent exploited it, how much of a relative position is amazon and compared to google working on a streaming service, apple, sony . The competition landscape is going to change dramatically in the next couple of years, isnt it . Matt content is king. I think the game makers realize they will not make the mistake that the video creators did. Theys a scale economy, can games that are so much larger. 100 millione budgets these days. The scale to create great games and have the content and developing teams, microsoft and sony working together will probably when the cloud. Probably win the cloud. Emily do we have any idea what kind of games amazon is working on . Are these like firstperson shooters or the farmville or angry birds . Matt they are more firstperson shooters. One is like a civil war era came. Warave stash er civil era game. The games that allow you to live inside that environment are the ones that have the staying power. They want to engage with the social element they have with twitch, for sure. Emily things for weighing in. Coming up, money gram and ripple have reached a deal. Will it bring the cryptocurrency that much closer to the mainstream . And youtube kids video site has a problem. Kids are leaving. Why they have struggled to hang on to younger viewers. This is bloomberg. Emily this is bloomberg technology, im emily chang in san francisco. Is bitcoin getting a facebook bump . The crip toe currency crossed the 9,000 mark, coming as the world awaits the launch of facebobbings own Digital Currency this week. Ripple has Just Announced a partnership with the Global Payments provider moneygram. It will let ripple serve as a cross border payment and Foreign Exchange settlement option for moneygram. To tell us more, ripples c. E. O. Is with us, joining us from ripple h. Q. In san francisco. God to have you back with us. Moneygram owns about 5 of the global remitance market. How will this deal work . Brad emily, its great to be back, thank you. The deal is a big step i think for ripple but even a bigger step for the overall industry. As you know well, theres been a lot of excitement about around what blockchain and crip toe can mean for the and crypto can mean for the industry. We havent seen much beyond experimentation yet. We are the Market Leader because we have mature aid agressively and are solving real problems for real customers. Moneygram is just the manifestation of that as the second Largest Global remitance company were able to have a big impact with one customer and one partner in this emily as i understand it, Western Union tested ripple but it ended up being more expensive than its current network. Is moneygram saving bun my using rip snl brad what Western Union said, theyve been around for decades they said in our beta time, the time the product hadnt launched they said we matched the efficient soif what they were already optimized my view is theyd spent decades getting to an efficiency we matched with a beta product, i was pleased that Western Union could come out and say we are already as good as their decades they had invested in building out that capability. With moneygram we know out of the gates we can make their system much more efficient. And the key reason is today both Western Union and money gram, they prefund accounts around the world so they can make payments. So moneygram and Western Union have negative working capita what our products allow the companies to do is not prefund and just shoot payments in realtime. Thats a massive savings in terms of efficiency, not just in terms of what is the cost and f. X. But the capital cost. Its a dormant asset when you prefund those, sitting there waiting for people to make payments. Thats the transformational thing that xrp is an extremely efficient Digital Asset allows for the asset. Emily how much equity did ripple get in this deal . Brad we committed to invest up to 50 million. Well end up owning between 6 and 10 of the company. They decide how much of that 50 million they want to call down. At close theyve called down 30 million at a price of 4. 10 per share. So were excited to be shareholders because we think that actually its been an undervalued asset. As you may know, a company tried to buy moneygram a year ago, blocked by cfius. But we think its an undervalued asset in the overall landscape. We couldnt be more excited to have a shared vision of how this can work. Emily a potential blocked by the u. S. Government. Do you have plans tie to the tie o gain share in other existing Money Transfer services . Brad whats next for us is to continue to build out and expand the number of corridors where we are today. We work with over 200 banks and Financial Institutions today. If this new product, were enabling liquidity into the mexican peso and the philippine pay tso. Weve on