Transcripts For BLOOMBERG Bloomberg Technology 20240714 : vi

The tech involving giant concrete blocks. Well talk to the ceo. Slow downfies chinas amidst a trade war with sales surpassing expectations. First to our top story fresh off offaking waves tfor cutting cloudrt to 8chan flare has vowed to go public. They called the use of its network by 8 chan a risk factor. Gunmanis where a posted messages before the attack in el paso and new zealand. It also included daily storm after the deadly 2017 protests in charlottesville. Critics say in both cases it should have happened sooner. Liana baker is in new york. Also there, cybersecurity reporter will. Walk us through the highlights of cloudflares filing. Like many other tech ipo s, especially in software, it is not profitable. It has a pretty good growth rate, the. Though. Its really trying to look at its competitor that went public earlier this year and is doing ok. There has been some sources of mine who were asking me why cloudflare took this long to get theirs point, ahd nd have filing . They had been preparing since the fall of last year for a public offering. Emily cloudflare is a company that, a we have heard off in about companies that will go public soon. Tell us about exactly cloudflare does. In the case of a company like 8chan, they basically protected it from being taking down in denial of service attacks. Will one of cloudflares most wellknown products is d dos prevention service. It protects the website from a denial of service attack. Anyone looking to attack the website and take it offline. They offer the service to tons of websites on the internet. They think of themselves as a utility. When you have the service, it is the most effective or one of the most effective ways to protect your website from attacks like this. Emily right. And there is where 8chan comes up because cloudflare did not cut off 8chan, despite the site was still operational until days ago after that shooting in el paso, texas. Talk about what cloudflare says about 8chan and how investors might take that. Ne it is listed as a risk and the filing. This has garnered a lot of attention because its relevant in the headlines, but i think that cloudflare was really aiming in its filing today did you show the world how its financials are doing and what its prospects are. I think it did a good job of putting out there this is a solid company, the backbone of the internet. And there is pentup demand among investors for these sorts of companies to hit the market. Went weeks ago medalia public and crowd strike has a good valuation, a couple months after its ipo. Cloudflare today is really just trying to to be a Successful Software ipos from earlier this year. Cloudflare only made news when they made bad news under criticism that it helped keep some of these websites afloat. If you go back to 2017 and what happened in charlottesville at the time, cloudflare was under for for help under fire helping support a neonazi website the daily stormer. It was only after much criticism that they took the website down, cutting off service to it. I spoke to the ceo matthew prince of the time and talk some about their general policy of trying to remain neutral when it comes to content on line. Take a listen to what he said to me that. We turn we turn to the expertsd terrorism and illegal content which is Law Enforcement legislators, regulators. We say, here is this content. What would you like us to do . That feels like due process, that they are actually enshrined politically enshrined organizations that can make these decisions, as opposed to these decisions being made on the political whims oof me or mikes zuckerberg or jeff bezos. Emily when it came to 8chan, more recently, it was several hours after that shooting in el paso that cloudshare said we are cutting them off as well. In a statement at the time prince said, they have proven themselves to be lawless and a cause multiple tragic deaths. Even if 8chan had not violated the law in refuse to moderate their Hayfield Community data created an environment that level is. Hurting at spirit expand on the context. Are seeing Companies Facebook and google struggle with what to leave up and put on their platform. Ill cloudflare is an difficult position. Agent not want to make content decisions. Cloudflare sees itself as utility. It is hard to find other comparable products. So, when you do not have cloudflares ddos protection, it might be difficult to stay online. What that means is cloudflare basically can decide who gets to be on the internet. They dont want to make those decisions. After using they have only made the decision twice and removing daily stoermer and 8chan. When you do things like remove 8chan and remove daily stoermer, then you get people material to say, why not remove this website or whatever other website has vile content on it. I dont think this is a business cloudflare wants to be in. They do not want to be deciding what is on the internet and not. Emily and whats not. Emily the big question is how they will handle these issues as a public company. Thank you so much for that context today. Now lets switch gears to the ongoing trade war between the u. S. And china. President trumps decision to delay 10 tariffs on 300 billion in chinese imports has not stop beijing from vowing to hit back. No choice but to take necessary measures to retaliate. For moe, i want to bring and sammy greater in l. A. The president heading to the camera right now to speak to the press. We will bring that as we get it. There he is right now. President trump the economy is incredible. The consumer above all else is doing incredibly. So, go ahead. Any questions . [inaudible] President Trump i think were going to have a very long period of wealth and success. Other countries are doing very poorly. China is doing very poorly. Intoariffs have bittnen china but the reporters do not want to make it look that way but they do not understand what is happening. The tariffs we have taken in close to 6 billion in tariff money. The consumer has not paid for that. At some point they may have to pay something. They understand that. Who really understands that is the farmer. They know that we had to do something about china and we are doing something about china. That being said, i think we are having very good discussions with china. We will see what happens. We had a deal and he decided not to make it. Now i think they would like to of had that opportunity again, because i think they really would. I think they really missed a great opportunity. They feel they missed a great opportunity. But china very much wants to make a deal. Were talking to them. We will see what happens. [inaudible] two time congresswomens trip to israel. President trump im only involved in the sense that they are very antijewish and antiisrael. You have a list. This is not just a one line mistake. What they have said about israel and jeiwhs people is a horrible thing and it had become the face of the Democrat Party for i put up a strong statement. Languageok at their and you look language and you look at what they said, if i understood it, it would be a horrible month to put it mildly. So, the things they have said, talib, what theyve said is disgraceful. I cannot imagine why israel would leti cannot imagine why il would let them in. Are you worried that a prolonged trade war with china the economypush into recession . President trump the longer the trade war goes on the weaker china gets and the stronger we get. The stronger goes, we get. Ive a feeling it is going to go fairly short. China has lost millions of jobs. We saw that report today. Thousands of companies are closing in china. Maybe they want to do this. Maybe they would love to have somebody like biden who doesnt know what he the stronger we get. Is to i just put a clip where he said we want to build up china, we want to build up china. They gave us a very strong china. China has taken out over 500 billion for many years from our country and that is not going to happen anymore. [inaudible] how concerned are you about a violent crackdown by the chinese and hong kong . President trump very concerned. I put a memo out last night. A man i like very much and i get along with him very well president xi. I would willing to bet if he sat down with the protesters, i bet he would work it out in 15 minutes. I know it is not the kind of thing he does, but i think it would not be a bad idea. If he sat down, them a certain leadership pool, if he sat down with that leadership pool, i bet verywork something out quickly. It seems like things could be worked out very easily. There would have been hell to pay, but i did speak to people over there. China says they are going to retaliate because of the tariffs increase. What is your response to that . President trump if they did retaliate, because i do not think they will do, i dont think they will retaliate but if they did, we have the ultimate form of retaliation. China,w jobs left in because we would be able to step it up. Just so you understand, i have been very mild about it, very mild. There is a long way i can go. And somebody had to take on what was happening with china. We cant allow china to take out of our country 507 billion every year. Not including intellectual property theft and so many other things. So, we are having very good talk for china. I think things will happen but we will see. If they do retaliate, would you want your team to meet with them in september as planned . President trump the meeting is still on as i understand it but september wetly in are talking by phone and having very productive talks. They would like to do something, i will tell you that. The talk we had a few days ago representatives, nobody knew what was on that talk except myself, china and those two people. That was a very good conversation. Do you want jay powell to cut Interest Rates . President trump jay powell should be cutting rates because every country all over the world is cutting. We want to stay evening. I dont mind if we are higher. We are better credit but we are too high. Jay powell made a big mistake. He raised them too fast and he also quantitative tightened. That was a big mistake. 50 billion a month. He put us in a position, and interestly, even with normalized Interest Rates, president obama was saying nothing. We have a much better economy. And you have to look at our economy also from the day after my election, because we picked up tremendous steam the day after the election. That is not attribute of older president obama. They only did that because of us. When somebody says from january 20th. It is from november 9th, the day after the election we picked up. The fact that i won lifted our economy greatly. If i didnt win, it would go rankly, if for some reason that happens in the 2020 election, you will see this economy go down the tubes, i will tell you that right now. Do you have any idea on when china wais going to crackdown on fentanyl . President trump this was part of the conversation that we had. They had a special representative come over and talk to us, a Different Group had a message to me, very strong message to me. They want to start doing that very quickly. Ill be honest. I am not there yet. Not china. Im not there yet. We will see what happens. I really would like to see china in a humane way solve the problem in hong kong. Humanely solve the problem in hong kong. And i think they could do it very quickly. I said yesterday, i really have a lot of confidence in president xi. He sat down with their representatives, i have no doubt he would solve that problem quickly. [inaudible] did you encourage them to President Trump id dont encourage or discourage. I think that if israel allowed normal come in for the reasons other than the reasons, i believe it would be a terrible thing for israel. It would show a terrible time. They wanted to boycotts. They said horrible things about jewish capable and horrible things about israel and israeli. I think it would be a terrible thing for israel to let these two people who speak so badly about israel come in. They have become the face of the democrats. The democrats who do not want to do anything to condemn them. 10 yearsif this were ago worth this were a maybe a different time or different people or whatever, they would be condemned for the things they have said. Some of the sai worst things ive heard them say about israel. How can israel say, welcome. I dont think it would big a good thing for israel. I dont know the situation with steve king. I read a statement that supposedly he made. I havent been briefed on it but certainly was not good statement. W you are going to go to the g7 pretty soon emily President Trump taking questions from the press as he prepares to head to moorestown, new jersey. About to head to manchester, new hampshire, where he is holding a rally tonight. The vast majority of the questions from the press about china. As far as he knows, the meeting in september is still on. Having good discussions with the chinese. Also saying that china is doing very poorly in wants to make a deal. He touched on the situation in hong kong again saying he would like to see that resolved in a humane way. That he is concerned about a andent crackdown encouraging chinese president xi to have a personal meeting with the protest. I want to bring back sarah mcgregor. The president was heading to camera to feel these issues. And just as we were talking about china vowing to retaliate which the president says he does not think will happen, yet the chinese just said they will retaliate. First of all, what do you make of the president s remarks just now . You know, it is always interesting when we hear from donald trump and directly from him, the point of view. I thought what was very interesting with him saying the longer the trade war goes on the more it will hurt china. When we saw the markets yesterday in a tizzy, and a lot of, the word recession being bandied about a bit. As arade tensions are seen key driver as some of this economic weakness right now in the world. And thinki, you know, donald trump has kind of positioned this trade war as something that china will give him a deal that he wants. Its going to hurt them more than it will hurt that u. S. That has been brought into question. Used havefs hes really, has pinched china but they have also heard u. S. Importers and they are the one paying these duties for billions of dollars he says that is coming into the u. S. From these tariffs, i think a lot of u. S. Businesses would argue they are the ones paying them. Emily right. Alibaba, a huge Chinese Company with a lot of exposure to the economy, the low expectations with strong sales today. Certainly alibaba not getting hurt in a midst of a trade war. How might the chinese retaliate if they do retaliate . Sarah china imports fewer things from the u. S. Than the u. S. Imports from china, which means there are far fewer targets for china to hit with additional tariffs. In the past they have had agricultural goods, and whiskey from states where republicans have a pretty strong support donald trump himself. Heading into election year, if there is more to tariffs on that that china ise doing the consolation on that and trying to figure out how to hit trump where it hurts politically. In addition, weve heard about rare earth exports coming those off. Also ways of blocking investment. A lot of u. S. Companies love that chinese markets, given all the consumers that, as well as lower cost of production. There is a multitude of ways. Emily all right. Something you will continue to follow as will all of us. Sarah mcgregor, thank is so much. Coming up, the woman accused of hacking capital one accused of breaching over 30 other companies. How did this all go undetected . We will discuss next. This is bloomberg. Emily the seattle woman accused of hacking into cap the ones cloud and stealing personal information on 109 customers also broken to the servers of more than 30 other companies, according to the u. S. Government. A Prosecutor Says thompsons crime, major cyber intrusions that resulted in the theft of a massive amount of data, would in what appears to be 30 Victim Companies only exacerbates thompson has done. This is part of a request to not release her from custody. To discuss the follow from the case we are joined by a Vice President of product management, khris davis. Chris, you worked as a Cloud Security architect for aws and capital one was ud services and you worked at a strategist for oracle. Hopper this woman have hacked into 30 other companies undetected how could this woman have hoppeakcedcked into 0 other companies . At the end of the day it is about identifying the security you have inside the cloud. It is wanting to move everything into that environment and you get to take a lot of advantage of what people are looking for in the club but its in the cloud, but it is that migration and getting that set up and maintaining that overtime and that is a very difficult proposition. Emily is this a failure of the security of these companies or failure of Law Enforcement . I would suggest it is neither. I would suggest security is an interesting beast because all i need is one way to access your systems to get into your systems. A foothold, it is easy to move laterally and see what is next door, what other systems can i compromise. In this particular case, that is what happened. She was able to get access to one system and a hacker only needs one foothold, just one. In, it is a matter of moving around, identifying what target you might have, getting that data and movintg g the data outside of the system so you can have access to it. Emily i know somebody that used to work at aws. This wasnt a failing on amazon part. Ss there was a flying capital one system that said are you concerned is what discret decree consumer and enterprise confidence in the cloud . Im not. Actually in some small way i am kind of glad that some light has been brought to bear on some of the problems, some the misconfigurations people have. If anything we have to have that cloud environment. We need the agility, the technical benefits we are looking for from the cloud environment. Honestly a makes people more competitive. And, from that perspective, if i know i need to move in that direction anyways, i need to make sure i have the appropriate skill set, i need to make sure i have the appropriate controls, safeguards, and countermeasures and that is what im doing. Now i have a big flashlight, if you will, on the problem itself and i can address it. Is going tory were continue to follow what happens with the suspect in a capital one case. Chris davis, thanks so much. We will be back with more of bloomberg tech. Talking Energy Storage investment next. Emily this is bloomberg technology. Softbanks vision fund is betting big on Successful Software<\/a> ipos from earlier this year. Cloudflare only made news when they made bad news under criticism that it helped keep some of these websites afloat. If you go back to 2017 and what happened in charlottesville at the time, cloudflare was under for for help under fire helping support a neonazi website the daily stormer. It was only after much criticism that they took the website down, cutting off service to it. I spoke to the ceo matthew prince of the time and talk some about their general policy of trying to remain neutral when it comes to content on line. Take a listen to what he said to me that. We turn we turn to the expertsd terrorism and illegal content which is Law Enforcement<\/a> legislators, regulators. We say, here is this content. What would you like us to do . That feels like due process, that they are actually enshrined politically enshrined organizations that can make these decisions, as opposed to these decisions being made on the political whims oof me or mikes zuckerberg or jeff bezos. Emily when it came to 8chan, more recently, it was several hours after that shooting in el paso that cloudshare said we are cutting them off as well. In a statement at the time prince said, they have proven themselves to be lawless and a cause multiple tragic deaths. Even if 8chan had not violated the law in refuse to moderate their Hayfield Community<\/a> data created an environment that level is. Hurting at spirit expand on the context. Are seeing Companies Facebook<\/a> and google struggle with what to leave up and put on their platform. Ill cloudflare is an difficult position. Agent not want to make content decisions. Cloudflare sees itself as utility. It is hard to find other comparable products. So, when you do not have cloudflares ddos protection, it might be difficult to stay online. What that means is cloudflare basically can decide who gets to be on the internet. They dont want to make those decisions. After using they have only made the decision twice and removing daily stoermer and 8chan. When you do things like remove 8chan and remove daily stoermer, then you get people material to say, why not remove this website or whatever other website has vile content on it. I dont think this is a business cloudflare wants to be in. They do not want to be deciding what is on the internet and not. Emily and whats not. Emily the big question is how they will handle these issues as a public company. Thank you so much for that context today. Now lets switch gears to the ongoing trade war between the u. S. And china. President trumps decision to delay 10 tariffs on 300 billion in chinese imports has not stop beijing from vowing to hit back. No choice but to take necessary measures to retaliate. For moe, i want to bring and sammy greater in l. A. The president heading to the camera right now to speak to the press. We will bring that as we get it. There he is right now. President trump the economy is incredible. The consumer above all else is doing incredibly. So, go ahead. Any questions . [inaudible] President Trump<\/a> i think were going to have a very long period of wealth and success. Other countries are doing very poorly. China is doing very poorly. Intoariffs have bittnen china but the reporters do not want to make it look that way but they do not understand what is happening. The tariffs we have taken in close to 6 billion in tariff money. The consumer has not paid for that. At some point they may have to pay something. They understand that. Who really understands that is the farmer. They know that we had to do something about china and we are doing something about china. That being said, i think we are having very good discussions with china. We will see what happens. We had a deal and he decided not to make it. Now i think they would like to of had that opportunity again, because i think they really would. I think they really missed a great opportunity. They feel they missed a great opportunity. But china very much wants to make a deal. Were talking to them. We will see what happens. [inaudible] two time congresswomens trip to israel. President trump im only involved in the sense that they are very antijewish and antiisrael. You have a list. This is not just a one line mistake. What they have said about israel and jeiwhs people is a horrible thing and it had become the face of the Democrat Party<\/a> for i put up a strong statement. Languageok at their and you look language and you look at what they said, if i understood it, it would be a horrible month to put it mildly. So, the things they have said, talib, what theyve said is disgraceful. I cannot imagine why israel would leti cannot imagine why il would let them in. Are you worried that a prolonged trade war with china the economypush into recession . President trump the longer the trade war goes on the weaker china gets and the stronger we get. The stronger goes, we get. Ive a feeling it is going to go fairly short. China has lost millions of jobs. We saw that report today. Thousands of companies are closing in china. Maybe they want to do this. Maybe they would love to have somebody like biden who doesnt know what he the stronger we get. Is to i just put a clip where he said we want to build up china, we want to build up china. They gave us a very strong china. China has taken out over 500 billion for many years from our country and that is not going to happen anymore. [inaudible] how concerned are you about a violent crackdown by the chinese and hong kong . President trump very concerned. I put a memo out last night. A man i like very much and i get along with him very well president xi. I would willing to bet if he sat down with the protesters, i bet he would work it out in 15 minutes. I know it is not the kind of thing he does, but i think it would not be a bad idea. If he sat down, them a certain leadership pool, if he sat down with that leadership pool, i bet verywork something out quickly. It seems like things could be worked out very easily. There would have been hell to pay, but i did speak to people over there. China says they are going to retaliate because of the tariffs increase. What is your response to that . President trump if they did retaliate, because i do not think they will do, i dont think they will retaliate but if they did, we have the ultimate form of retaliation. China,w jobs left in because we would be able to step it up. Just so you understand, i have been very mild about it, very mild. There is a long way i can go. And somebody had to take on what was happening with china. We cant allow china to take out of our country 507 billion every year. Not including intellectual property theft and so many other things. So, we are having very good talk for china. I think things will happen but we will see. If they do retaliate, would you want your team to meet with them in september as planned . President trump the meeting is still on as i understand it but september wetly in are talking by phone and having very productive talks. They would like to do something, i will tell you that. The talk we had a few days ago representatives, nobody knew what was on that talk except myself, china and those two people. That was a very good conversation. Do you want jay powell to cut Interest Rates<\/a> . President trump jay powell should be cutting rates because every country all over the world is cutting. We want to stay evening. I dont mind if we are higher. We are better credit but we are too high. Jay powell made a big mistake. He raised them too fast and he also quantitative tightened. That was a big mistake. 50 billion a month. He put us in a position, and interestly, even with normalized Interest Rates<\/a>, president obama was saying nothing. We have a much better economy. And you have to look at our economy also from the day after my election, because we picked up tremendous steam the day after the election. That is not attribute of older president obama. They only did that because of us. When somebody says from january 20th. It is from november 9th, the day after the election we picked up. The fact that i won lifted our economy greatly. If i didnt win, it would go rankly, if for some reason that happens in the 2020 election, you will see this economy go down the tubes, i will tell you that right now. Do you have any idea on when china wais going to crackdown on fentanyl . President trump this was part of the conversation that we had. They had a special representative come over and talk to us, a Different Group<\/a> had a message to me, very strong message to me. They want to start doing that very quickly. Ill be honest. I am not there yet. Not china. Im not there yet. We will see what happens. I really would like to see china in a humane way solve the problem in hong kong. Humanely solve the problem in hong kong. And i think they could do it very quickly. I said yesterday, i really have a lot of confidence in president xi. He sat down with their representatives, i have no doubt he would solve that problem quickly. [inaudible] did you encourage them to President Trump<\/a> id dont encourage or discourage. I think that if israel allowed normal come in for the reasons other than the reasons, i believe it would be a terrible thing for israel. It would show a terrible time. They wanted to boycotts. They said horrible things about jewish capable and horrible things about israel and israeli. I think it would be a terrible thing for israel to let these two people who speak so badly about israel come in. They have become the face of the democrats. The democrats who do not want to do anything to condemn them. 10 yearsif this were ago worth this were a maybe a different time or different people or whatever, they would be condemned for the things they have said. Some of the sai worst things ive heard them say about israel. How can israel say, welcome. I dont think it would big a good thing for israel. I dont know the situation with steve king. I read a statement that supposedly he made. I havent been briefed on it but certainly was not good statement. W you are going to go to the g7 pretty soon emily President Trump<\/a> taking questions from the press as he prepares to head to moorestown, new jersey. About to head to manchester, new hampshire, where he is holding a rally tonight. The vast majority of the questions from the press about china. As far as he knows, the meeting in september is still on. Having good discussions with the chinese. Also saying that china is doing very poorly in wants to make a deal. He touched on the situation in hong kong again saying he would like to see that resolved in a humane way. That he is concerned about a andent crackdown encouraging chinese president xi to have a personal meeting with the protest. I want to bring back sarah mcgregor. The president was heading to camera to feel these issues. And just as we were talking about china vowing to retaliate which the president says he does not think will happen, yet the chinese just said they will retaliate. First of all, what do you make of the president s remarks just now . You know, it is always interesting when we hear from donald trump and directly from him, the point of view. I thought what was very interesting with him saying the longer the trade war goes on the more it will hurt china. When we saw the markets yesterday in a tizzy, and a lot of, the word recession being bandied about a bit. As arade tensions are seen key driver as some of this economic weakness right now in the world. And thinki, you know, donald trump has kind of positioned this trade war as something that china will give him a deal that he wants. Its going to hurt them more than it will hurt that u. S. That has been brought into question. Used havefs hes really, has pinched china but they have also heard u. S. Importers and they are the one paying these duties for billions of dollars he says that is coming into the u. S. From these tariffs, i think a lot of u. S. Businesses would argue they are the ones paying them. Emily right. Alibaba, a huge Chinese Company<\/a> with a lot of exposure to the economy, the low expectations with strong sales today. Certainly alibaba not getting hurt in a midst of a trade war. How might the chinese retaliate if they do retaliate . Sarah china imports fewer things from the u. S. Than the u. S. Imports from china, which means there are far fewer targets for china to hit with additional tariffs. In the past they have had agricultural goods, and whiskey from states where republicans have a pretty strong support donald trump himself. Heading into election year, if there is more to tariffs on that that china ise doing the consolation on that and trying to figure out how to hit trump where it hurts politically. In addition, weve heard about rare earth exports coming those off. Also ways of blocking investment. A lot of u. S. Companies love that chinese markets, given all the consumers that, as well as lower cost of production. There is a multitude of ways. Emily all right. Something you will continue to follow as will all of us. Sarah mcgregor, thank is so much. Coming up, the woman accused of hacking capital one accused of breaching over 30 other companies. How did this all go undetected . We will discuss next. This is bloomberg. Emily the seattle woman accused of hacking into cap the ones cloud and stealing personal information on 109 customers also broken to the servers of more than 30 other companies, according to the u. S. Government. A Prosecutor Says<\/a> thompsons crime, major cyber intrusions that resulted in the theft of a massive amount of data, would in what appears to be 30 Victim Companies<\/a> only exacerbates thompson has done. This is part of a request to not release her from custody. To discuss the follow from the case we are joined by a Vice President<\/a> of product management, khris davis. Chris, you worked as a Cloud Security<\/a> architect for aws and capital one was ud services and you worked at a strategist for oracle. Hopper this woman have hacked into 30 other companies undetected how could this woman have hoppeakcedcked into 0 other companies . At the end of the day it is about identifying the security you have inside the cloud. It is wanting to move everything into that environment and you get to take a lot of advantage of what people are looking for in the club but its in the cloud, but it is that migration and getting that set up and maintaining that overtime and that is a very difficult proposition. Emily is this a failure of the security of these companies or failure of Law Enforcement<\/a> . I would suggest it is neither. I would suggest security is an interesting beast because all i need is one way to access your systems to get into your systems. A foothold, it is easy to move laterally and see what is next door, what other systems can i compromise. In this particular case, that is what happened. She was able to get access to one system and a hacker only needs one foothold, just one. In, it is a matter of moving around, identifying what target you might have, getting that data and movintg g the data outside of the system so you can have access to it. Emily i know somebody that used to work at aws. This wasnt a failing on amazon part. Ss there was a flying capital one system that said are you concerned is what discret decree consumer and enterprise confidence in the cloud . Im not. Actually in some small way i am kind of glad that some light has been brought to bear on some of the problems, some the misconfigurations people have. If anything we have to have that cloud environment. We need the agility, the technical benefits we are looking for from the cloud environment. Honestly a makes people more competitive. And, from that perspective, if i know i need to move in that direction anyways, i need to make sure i have the appropriate skill set, i need to make sure i have the appropriate controls, safeguards, and countermeasures and that is what im doing. Now i have a big flashlight, if you will, on the problem itself and i can address it. Is going tory were continue to follow what happens with the suspect in a capital one case. Chris davis, thanks so much. We will be back with more of bloomberg tech. Talking Energy Storage<\/a> investment next. Emily this is bloomberg technology. Softbanks vision fund is betting big on Renewable Energy<\/a>, and announcing it is investing 110 million in an Energy Storage<\/a> startup. The companys system uses cranes to stack concrete blocks and a tower that can store and release energy. It is presenting the system as a bigger and more affordable solution to lithium batteries, claiming it can supply electricity to the grid 24 hours a day. How exactly does this Technology Work<\/a> . Design of their new innovative system tower includes a newly designed crane. It includes 35,000 metric ton bricks that are all orchestrated and raised and lowered with a proprietary software set, so that is the whole system integration. We take excess energy from solar or wind when it is produced and not needed. That energy is used to raise the blocks and when the energy is needed by the grid, we lower those blocks and discharge the energy. Emily how widely deployed is this . It says you are on four continents. Correct. We have had a working model for the last year in switzerland. We are building our first commercial scale unit in the Fourth Quarter<\/a> in the north of many,and, as we announced many customer engagements on many continents, so we are excited. Emily what do you think the draw is . Softbank gekko they share our vision for rubles and understand how important it is to make renewables real and make renewables solve the problem of our reliance on also fuel. On fossil fuel. They understand beyond just being an investor. They share our passion to be part of the solution. Emily it relies on this giant Automated System<\/a> that has to work reliably outside in the elements year after year after year. Do you have concerns, or is there a risk that some parts might not function properly given all that exposure you can thats one of the beauties of it. The technology we are leveraging his proven physics. We are leveraging unique material science working with one of the Largest Materials Companies<\/a> in the world, so we actually are using a material composite for 95 of these bricks and raising and lowering them, so the fundamental core physics is known. Our innovation comes in with the proprietary Machine Software<\/a> that fully automate the tower as well as a lot of other innovation we thought of. This last point is important. Not only the materials, we can use the soil right from the site we excavate locally to make these bricks, so we dont have bring in trucks, materials. We are not spewing omissions with trucks coming in or other transportation elements coming in, and from a sustainable perspective, we use some of the Global Supply<\/a> is in a supply Chain Ecosystem<\/a> that exist today, so we can do it now. Emily we have seen lithium ion batteries start to be attached to the energy grid, but also they can only supply energy for hours at a time. Another one of the innovations here is long durations. Hours. Do eight to 12 think about manufacturing companies. The power 24 hours a day. Then you the power to make Drinking Water<\/a> 24 hours a day and we can now provide them for the first time that power. Emily we have seen a lot of pushback from against the Solar Companies<\/a> because of the fact that they dont look attractive. Do you run the risk of that as well . A large concrete tower, while it might not work, it might not be what Companies Want<\/a> in their backyard. For most of the markets we will be building this system, it is out where there are farms. Wind farms, where theres already turbans sitting up high, and the off grid applications which are pretty important for us to get power to remote farms, villages, etc. , two areas that need power that cannot get it from the grid. In those locations, we dont see a lot of problem. Emily does not a lot of companies that do it this way. What do you think is the most challenging what other company is working on this that might be the most challenging idea what you have proposed . The big thing that has not been solved until now are for the economics. How do you get Renewable Energy<\/a> price . Down to thats the major innovation. We have done that the material science we have done that through the material science and sustainability. That is what we are solving that no one has been able to solve. Emily you have other competing, crazy, bold ideas. Obviously a lot of paths to get to the best results and create the most amount of energy at the cheapest price. What do you think makes this better than all of those others . Three main reasons when we designed this, we did not want to have this dependency on things like geology or geography or topology. Dams, for example, rely on mountains and things. We want to be able to deliver this everywhere, the problem we are solving. Second, sustainability. , howcal Battery Companies<\/a> they get the material, the batteries degrade immediately when you install them. Our system doesnt degrade at all. You have to install the sciquest material science, across design, and thinking of sustainability. Emily thank you for joining us on your trip through san francisco. I know youre headed back to switzerland. A prominent chinese venture companys expects the new ai subsidiary to go public with indeed of years, revenue topping 100 million from that time. He spoke exquisitely to our own selina wang. We dont plan this ahead of time. I think based on the trajectory of high innovation, it is today fair to say it is the fastest to 100 million Revenue Company<\/a> in the world for ai. Selina where are you now . We are not there yet, but by the time we project will get there it will be the fastest to reach 100 million in revenue. A lot of socalled unicorns are not even at 100 billion of revenue. I think it can get there pretty. Ritical pretty quickly at that point, it should be well over unicorn and can be listed publicly. What is your timeline for an ipo . I think that would be close to time. 100 million revenue at a price ratio of 10 or so, which value so it company at 10, would not be far from now. Less than two years from now. In your bookrote that the era of technological discoveries over and now is all about implementation. How do you see this business continuing to evolve . A very earlyll at stage in commercialization. We are still at kind of the equivalent of early internet portals, back when everybody was using yahoo and there wasnt even a google yet, nor amazon or facebook. Theres a lot of room to reap rewards. Selina we are seeing venture deals fall dramatically. Longtermnk this is a winter, or is it just a healthy shortterm place to bring valuations back to heavy levels . On the negative side in an economy that is slowed down, everything slows down, including venture capital. What will happen is there will definitely be a shakeout. The top d. C. s will continue to thrive. I think many of the smaller first time vcs that may have raised money using unconventional ways are going to get in trouble, so that is one part of it. The Positive Side<\/a> is if the economy is challenging and the valuations are down, theres a good chance for us to go shopping. There are reports that some chinese ai companies, including some that you are invested in, could be added to that blacklist, which means they would be cut off from u. S. Technology. How do you see that playing out . Does it have an impact on chinas ai industry . Ai companies are largely that on Software Stacks<\/a> are domestically developed, so i think the impact would be much less than, say, a company like intricateich has Hardware Software<\/a> products built with multiple dependencies. Beena the u. S. Has lamenting deals and many investors have been scaling back. How does this impact her company in the shortterm and longterm . In the shortterm, it has no impact. U. S. Investment has always been less than 5 of our total. , so itgoes from 5 to 2 is inconsequential. In the long term, i think it is a pity if we have to really cause a total separation of two couldies because one argue that Artificial Intelligence<\/a> got to where it got to because the whole world has been able to work together. Emily coming up, first the operator becomes a robot, and now the internet has bots replacing Customer Service<\/a> reps everywhere. We will look at who is creating these automated answerers next. This is bloomberg. Emily fashion designers, interior designers, graphic. Esigners bloomberg looks at one Company Creating<\/a> automated tools that are in almost every corner now of the internet. Now there is also the chatbot designer. Bloomberg looks at one Company Creating<\/a> automated tools that are in almost every corner now of the internet. [telephone rings] around the world, businesses eachhundreds of requests year. We want our flights changed, a purchase refunded, a claim reviewed. That takes the labor of millions of asians who tend to our every need millions of agents who tend to our every need. But technology is taking over some of that in its tarts with the painstaking work of this 23yearold and it starts with the painstaking work of this 23yearold. You probably know the Dominican Republic<\/a> for its beaches, but further west in the capital santo domingo, there is a bustling help of call centers for american businesses. Some of their inquiries are headed by traditional agents over the phone. Others are handed handled by. Ontact Center Agents<\/a> last year, the company introduced a third kind of agent a bot. For threeseas bots u. S. Clients, and they greet customers looking for assistance online laura oversees bots. They solve simple queries on their own and the more complicated questions get escalated to a human representative. Me as an agent, i used to say these conversations are just one call at a time. With bots, you dont have that limitation. Alexa, will i need an umbrella tomorrow . It might rain tomorrow. Theres a 54 chance. Bots today are everywhere, so the people who design their speech are in high demand. The job is kind of like writing a very dry screenplay with a choose your own adventure element for the many ways customers will respond. The hardest part comes once the bot goes live. Often, prescripted conversations do not work out the way laura and her team hoped they would. They are constantly tinkering. The way to start a day with a how it did to check on the previous day. I go into analytics and my favorite one is this. These are the moments when the bot did not know what the customer wanted . Exactly. I can also see how many times icked the first or second button. If my visitors are not interacting with the menu, that means maybe somethings not right. You used to be coaching human agents, and now you are coaching a robot. Is that easier or harder . Easier. You dont have to worry about hurting a bots feelings. You are not emotional about it. Doing what you need to do for getting their response to work. Laura started out as an entrylevel agent when she was 17 and worked her way up. Was chosen to manage her companys first and todaye chat bot makes eight dollars an hour which is about four times what she earned when she first became an agent. The transition to work on chatbots took about three years to learn various aspects of the job including training and special software that does not require her to code. Immediately saw the benefits. A bot is never late. A bot doesnt get sick or pregnant. Those are specific human situations that you cannot fight. Automation is able to take that out. Emily still ahead, alibaba out with earnings. How the company is faring in the midst of global trade tensions and the economic slowdown next. This is bloomberg. Emily trade war . What trade war . Alibaba shares surged after the ecommerce giant posted betterthanexpected results, earnings, and revenue despite economic and geopolitical headwinds. Alibaba saw quarterly revenue rise 42 to 16. 3 billion, surpassing the highest analyst estimate. Net income also beating. , kevin us to discuss carter and in beijing, selina wang. How did alibaba defy gravity or expectations . In spite of the trade wars, in spite of the tariff talks, the real story in china and emerging markets is the billions of consumers that are moving up and they want stuff more and better food, more and better clothing, appliances, etc. That has been the story. That remains the story. Even as growth has slowed in china, retail sales and consumption continues. In emerging markets, that consumption is going online onto a smart phone, just as it is here, but there is a leapfrogging going on because the traditional infrastructure was never developed in china. Emily alibabas cofounder talked about demographics and growthation driving this despite what was happening macro economically and geopolitically, but i guess the question is how long can that keep up . You are right, the question is how long can this support alibabas burning amid this macroeconomic slowdown and trade war that looks like it has no end how long can the support alibabas earning . The developed markets are reaching the levels of consumption of developed markets around the world. In addition to that, they are cities, andr tier they are starting to pay off. It shows that they are really able to go headtohead with competition with companies that are focused specifically on these lower tier markets, and they say that they are planning to invest more in these areas, that their market share is, in fact, growing as well. This is a big trend in china that seems to be defying the broader slowdown. In addition to that, they are investing a lot in personalization, in targeting these types of consumers better with better algorithms, as well as investing in sales promotions. That altogether is helping boost that china Commerce Business<\/a> by 40 , almost twice the amount of Online Retail<\/a> sales in china. Emily with this lead you to believe that ecommerce in general as a segment will not be impacted by trade tensions in china would this lead you to believe . I think is probably the sector that would be affected least. Emily why . The trade war is about Agricultural Products<\/a> on our side, manufacturing goods. Qq and ecommerce, its about 500 Million People<\/a> in china that still dont have a smart phone. As soon as they get that, they are going to connect with their friends, play games, shop. The secular trend of ecommerce is a one direction or thing, and its not really part of the trade war. That point, jd. Com results,rted strong showing that alibaba does have strong competition. What are the headwinds alibaba faces a head . Beena alibaba has admitting competition from the likes of jd. Com, but we do some areas of challenge in that Cloud Computing<\/a> segment that still has negative operating margins. We also started to see growth decelerate in that area. This also losses in the Digital Media<\/a> entertainment sector that have narrowed, but they are facing increasing regulatory issues. Something worth pointing out is not it isis based off of advertising. It is not truly an Ecommerce Company<\/a> in the way you would think of amazon as an Ecommerce Company<\/a>. While we saw tencents Online Advertising<\/a> really take a hit, alibabas business has maintained strength there, so they are doing things to keep their customers engaged and improve the advertising return on investment for their customers. Emily if the trade war drags on, and it appears it is going to drag on we dont know how long what do you think the fallout will be in china more broadly . I think it is like the impact on the chinese economy. It is like the impact, the sectors that are part of the story, the export sector, the manufacturing sector, but i would like to think that the intofs are not going to go effect. Mathematically emily there are many already in effect. Thats true, but the new ones that were proposed that were pushed out until december, i would like to think this is just a negotiating tactic. Ae mathematics we had trade skirmish with china 10years ago. We put a terror on chinese tires. They responded by putting a feed. On our chicken that was put in under the obama administration. It lived for three years. Going back and studying it, is saved 1200 American Tire<\/a> making jobs at a cost of 1 million per job, and it also cost three jobs in retail for every job is saved, and the american taxpayer funded that. I would like to think the mathematics of this are clear enough that we wont really do the things we are threatening. The market i guess is voting now that we will have likely a recession in our country, and i, frankly, think it could be bad if we go ahead with tariffs as described. Emily what is that mean you are placing your bets . Emergingmarket Internet Companies<\/a> are not really part of the trade war. Its about people all over the world consuming, wanting stuff, using their smartphones. Emily thank you for joining us as well as selina wang on an Early Morning<\/a> in beijing. That does it for this edition of bloomberg technology. We are Live Streaming<\/a> on twitter. Check us out there. Follow our Global News Network<\/a> at tictoc as well. This is bloomberg. Paul welcome to daybreak australia. Shery im shery ahn of bloomberg World Headquarters<\/a> in new york. Sophie in hong kong, were counting down to me asias major market opens. Paul here are the top stories we are in the next hour. Procession recession fears down. Reasury levels","publisher":{"@type":"Organization","name":"archive.org","logo":{"@type":"ImageObject","width":"800","height":"600","url":"\/\/ia801007.us.archive.org\/27\/items\/BLOOMBERG_20190815_210000_Bloomberg_Technology\/BLOOMBERG_20190815_210000_Bloomberg_Technology.thumbs\/BLOOMBERG_20190815_210000_Bloomberg_Technology_000001.jpg"}},"autauthor":{"@type":"Organization"},"author":{"sameAs":"archive.org","name":"archive.org"}}],"coverageEndTime":"20240716T12:35:10+00:00"}