Interview with a ceo, three years after microsoft acquired the job listing site. Disruption, robots, supply chains, and Data Technology changing health care. We explore big changes coming to medical technology and how to invest in it. But first, to our top story. Up aneys general opened broad investigation into whether googles search and advertising practices violate antitrust and harm consumers. States attorneys general, led by texas, say they are investigating whether the search giants Business Practices are consumers. Harming anthis is not a lawsuit but investigation to look at facts. The facts will lead to where the facts lead. Taylor mondays announcement was closely followed by one that facebooks look into market dominance on friday. I am joined by a guest. She served as an assistant attorney general in the antitrust bureau of new york , ate, and in new york reporter who covers google for us, so lets just start with you. How big of a deal was this . Reporter it was pretty impressive to say 50 attorneys general. California and alabama are conspicuously missing. We will have to see what is missing with them. Lawyers whooup of represent the entire country, ag speaking from arkansas and ags speaking from arkansas and alaska. They need google and need their advertising to get in front of people, so the political tone here is they wanted it to seem like a big deal and wanted it to be a large, national, bipartisan investigation into the company. Taylor sally, what was your take away from the press Conference Today . Sally this is a huge deal. To have 50 state attorneys general, and i know there were some holdouts, but to have 50 state attorneys general, from both sides of the political spectrum, going to gather and give this long, indepth press announcement, where they explain all of their concerns, i think it is a very huge deal, and it just signals a new era against big tex big tech. Taylor this was a bipartisan issue, not just democrats or republicans, both aisles. Is this concerning from a tech perspective . Shouldyes, they definitely be concerned. This is a powerful coalition. It is hard to get things done in america right now because this country is so divided, but they are joining together and sharing the same concerns about Small Businesses being able to have a shot at reaching customers, about google unfairly increasing the costs and using its search monopoly to favor its own websites. Rit, a lot of state attorneys general came out, saying, we support free markets, we support innovation. Is google stifling these . Gerrit google would say they are not, doing Amazing Things to reach people on the internet, and, if course, that is how it started for some that use google and use the internet, but more and more, they are having to do things like pay more and more just to bid on their own brands, their own names, maybe even trademarks that they own. They even have to pay google to make sure that they show up instead of a competitor, so you are hearing more and more. It started out as a lot of grumbling, and you could dismiss some of that, but more and more, businesses are saying, look, this is not working for us anymore. This that works good for us before is becoming a trap, and we cannot keep paying into it just to become a float just to stay afloat, and that is going on. Taylor the Florida State attorney general said the service is not free. We are sacrificing data. Do you agree . Sally definitely. There has been a big deception on the American People that these Internet Services are free, both google and facebook. We are under constant surveillance, and we are offering up content that is valuable, and we are paying a very high price. There are some economists that said in a market that is competitive, we would be getting paid with for the information we are giving up. About sally, talk to me that data. So often in this program and in broader conversations, we talk about a monopoly and an antitrust issue and a privacy issue. Did today do a good enough job, separatet this is two issues . Sally i do not believe they are two separate issues. I think we are seeing a real convergence of privacy and antitrust. The reality is when these tech giants do not have competition, they are able to extract massive amounts of data from users, so i think there is a real convergence, and the other issue is that data is a huge competitive advantage, so as these companies are doing acquisition after acquisition that gives them unique data sets, they are creating barriers to entry for competitors and really fortifying their monopoly power. Taylor sally, how would they compete with big tech in china, lets say . Sally you know, i am really not so worried about china. That is kind of a red herring. I am much more worried about american businesses paying a tax just to be discovered on the internet. A represent asked google a representative asked google, it is true that 50 of searches go to google websites, and google was not able to give no as an answer to that question, so what we have is google taking over the internet because it has such a huge monopoly share. It is able to prioritize its own websites at the expense of every other business in our economy, so i am really not worried about china. Rrit, one of the legal barriers here is talking about how the consumer is harmed. As said, google is a free service for consumers. What about the consumer being harmed . Said, with, as sally consumers giving up their data without being paid for it in a fair way, that is something that google and other Large Tech Companies have done for a long time, and in the United States at least, they have been able to push off some of these investigations, because they were services that were free to the end consumer, but there is the consumer who buys the advertising. They need to bid on advertisement so people can find them online. That is a consumer of the google product, and that is kind of what the regulatory legal establishment in the United States has realized and come around to that, that there is consumer harm, even if gmail and search seems free for the end user. Taylor the investigation that is ever developing, thank you, sally hubbard, and our Bloomberg Technology reporter, gerrit. The latestit to season of stranger things, netflix has seen a significant acceleration in downloads. The third season of stranger things, a Science Fiction horror series, shares have fallen since july. And coming up, apple is under fire right before its big iphone event, the Company Confirming it violated labor law. What this could mean in terms of its relationship with beijing, next. And if you like bloomberg news, check us out online. You can listen on bloomberg. Com sirius xm. This is bloomberg. Wework has not hit Investment Grade status, but they may taking key from netflix by relying on junk bonds. Bwork has a Credit Rating of from both fitch and s p. And we are watching apple and soft con. It was confirmed they broke Chinese Labor law while building iphones, using too many temporary workers in the Worlds Largest iphone factory. The claims came from china labor watch. The group says it found other labor Rights Violations in the past. I am joined by tom, who currently has a buy rating on apple, enjoining us in the studio, and joining us in the studio is our reporter. Deal . S a big reporter yes, it is a big deal, because apple is at the top of its game, in top of the industry of treating work goals workers fairly, and here, they and foxconn are saving a lot of money by employing temporary workers versus fulltime workers year round. Move theom, does this needle for you when it comes to apple stock . Sure. I do think it is disappointing, and i agree with mark in that regard. It is sad that apple chose to use so many temporary workers in making their iphones, but when i think about the challenges facing technology companies, especially on the terror front, i do think that apple is on a front in an area where it is so big that it can lobby both the Chinese Government and the u. S. Government, but i do think it is disappointing that they would use so many temporary workers for making their iphones. Mark, apple affirmed the claims. What do they do to fix the problem . Irk what apple said, and believe this to be true, when they see challenges in their supply chain, see issues, breaking a law, which they are, they are going to rectify it, and they do not want this coming out again. From what i understand, they are going to be working with foxconn to fix this. This is some thing already being repaired. Then temporary workers, apple, 55 , down to 50 , now about 30 , so instead of that going back up again, i would imagine that is going to come back down closer to 10 . Of this is, how much about the general supply chain, given that apple is in the front battle of the u. S. China trade fight . Tom i do think for any multinational consumer electronic company, sourcing out of china, these are challenging times. We just had our Consumer Technology conference in new york, and so many who were participating were saying basically the challenge in todays environment is you do not know what the rules are from a tariff standpoint. Any day, you could find out that tariffs are 10 . The next day, you could find out they are 20 . I think what you will see over time is more Companies Moving their supply chain out of china. For apple, that might not be a great opportunity. In their case, they could see a lot of their suppliers move their production out of china. I think apple is going to try to continue to navigate the challenges, including the tariff, as it applies to its supply chain. China tom, we know that needs apple and apple needs china, but will we start to see more red tape, more difficulty for u. S. Tech companies over there in china, and that is chinas way of pushing back . Will beo expect there pushed back from the Chinese Government if more companies do, pushbt there will be ack from the Chinese Government if more companies do, in fact, move out. But they are operating from a position of strength, given they are in the exporter to the u. S. , and i do think this is a challenge that is going to take time to unpack, but i think in the case, again, for apple, they are kind of in a class by themselves. They have importance to both the Chinese Government and the u. S. Government. They have the ability to lobby both sides, and i think that puts them in a unique position. Have beend, mark, we ,alking about trade and tariffs since early to mid 2018. How easy is it to move to other locations outside of china, like vietnam . Equipment, it of is actually quite simple. One person at apple who works in the supply chain described it as and paste, copy, moving a supply chain to another company. The problem is the skilled labor. It is the people, having the amount of people, building a production city. That part is more difficult. Taylor tom, we are all looking at the big apple Product Launch tomorrow. What are you looking at . Are basically, i think they in a unique position. When expectation has been so low for a new iphone Product Launch, i would argue in its history, never. I am almost more interested to find out the pricing of apple tv plus then to find out the future of the next generation of iphones. Why is that . Because next year, we are looking for a 5g phone from apple. Owing back to tariffs, you may have consumers who are rushing to buy this generations device in anticipation of paying 10 plus more for next generation, solely because of tariffs, but, again, i think for new product news for apple tomorrow, i am more interested in the pricing for the apple tv plus than anything specific to the iphone. Rk, do you agree . Are low, buttions i think shatter proofing and Water Resistance are exciting. And then 3d cameras and a. R. Mark, thank you for joining me on all things apple. Coming up, a luxury firm ramping up competition with amazon, taking a day off its free delivery service. We bring you this, next. This is bloomberg. Twoday shipping quickly enough . Verishop does not think so, going further, allowing all customers to benefit from this without a membership fee, subscription, or minimum gochase, but is it enough to against amazon . Lets discuss. , also from snapchat. Great to have you. Freews from the day, shipping. Why the change . Customer first, employee second, and shareholder third, we are focused on how we can make our customer life better, and we focus on different shifting. We saw the positivity from our customers, and we want to make tongs better, and we want it get to you in one business day. Customers you say before shareholders. How are shareholders responding to the increased cost that this will cost the company . Imran i think if your customers are happy, they will keep coming back to you and become very loyal customers to you, and there is a significant lifetime value of customers. We are a very young company, less than one year old, but the way we are orienting the company and what we are getting everybody focused on is longterm and how we should think about the longterm value of customers, and we believe by delivering happiness to customers on a daily basis by delivering the product faster, having the best selection, having the best quality, and having the best Customer Support, let, we have our Customer Support phone number on the top of the site. Increaseso, we will the lifetime value of our customers, and we focus on that, and if we do that, that will create longterm shareholder value. Taylor amazon and walmart have also come out with 3, 1day shipping. How do you compete . Imran first of all, i think we have to recognize that ecommerce is a very, very large market. It is about 1 trillion. Only 10 of that is online, so retail by far is one of the biggest Market Opportunities out there, and Online Purchases are still pretty low, so we do not think it is a zerosum game. Weare really focused on how can sell to our customers better. We are focusing on categories like men and womens fashion, beauty. We recently launched kitchen, and we are focused on how we can service our customers better, and we believe the market is big enough for multiple players to do well. Taylor and are those types of consumer products, the categories, the ways in which you think you are able to differentiate yourself from someone like amazon . Journey,e customer from coming to our site to getting the product, so when they come to our side, we make it incredibly easy for the discovery of the product. We have things like responsible shop, where you can easily find sustainable, ecofriendly products. We have a lot of filtering options to find rate products. We have one called taste makers, so you can find your favorite ndeduencers recomme product. We scan for quality. We have people who talk to different vendors, and we source the product. By doing so, we have thirdparty sellers, so there is the quality of the product and the authenticity of the product, and then how we provide the after Customer Support. We are really focused on making sure customers find all of the premium product in one place, and they get it quickly, and they have a great experience if they have any questions. I keep wanting to go back to it is a very large market. Only 10 of retail is ecommerce, and we think multiple players will serve the customers better. Taylor what is the pressure in the room to be profitable . Imran i think we are very lucky to have a group of investors who really see the opportunity, and we are focused on driving the value for the customers, and i think the other thing is we really, really want to build a company, so i think anything that would not make our customer life better, we do not try to spend money on that. We are focused on customers. As a company, you have to make choices, and we are making choices for the customers. That is how we are orienting the company. We want to be profitable. I think the business can be profitable, significantly. A lot of Retail Companies are incredibly profitable. In the United States, our goal is to drive the lifetime value of customers. Taylor quickly here, any plans to go public . Imran we are way too early. Ceo imran, verishops khan, thank you for joining me. And our conversation with facebooks privacy officer is next. This is bloomberg. This is Bloomberg Technology. Im taylor riggs. Back to our top story, the increasing probes into alleged antitrust behaviors by big tech companies. This time, google was in the spotlight. 50 attorneys general opened a broad probe into the companys certain advertising practices. This followed fridays turn of events, new yorks attorney general announced she is investigating whether the social network was stifling competition. I sat down with facebooks former chief privacy officer chris to get his thoughts. Chris it was almost inevitable that Big Technology would be in the crosshairs of too tough a concept to imagine here. There are a lot of questions that have gone on in the number of different areas and a lot of them are getting swept up into antitrust type of conversation. There is challenges to that we need to talk about, but more than anything else, when companies touch peoples lives in so many ways, there is inevitably a question about whether they are always laying fair. Taylor this is the state attorney generals case, facebook fined 5 billion from the fec. Did that find not go far enough . Chris there are some people that argue that. There are different questions of privacy and antitrust. The ftc and doj at the federal level have an antitrust investigation going targeting facebook and google apparently. Given the effect these companies have on the economy, it is a pretty natural thing for this to happen. It does not