Pushing shares of the Company Higher on friday. We bring you our conversation with the ceo, bob swan. But first to our top story. After years of critics piling on facebook, blaming it for altering the news industry, the social network is trying to make nice. On friday, facebook launched its news tab. It will feature articles chosen partly by employees and the company says it will be free from editorial guidance from facebook. There are more than 200 publishers on board. Some, being paid more than 1 million for their involvement. Speaking in new york, Mark Zuckerberg outlined another way for news organizations to make money. You can run your own ads and get 100 of the revenue or you can use our ad network, which we have a lot of engineers and people trying to build a really advanced technology for this and there, we give the vast majority of the revenue to the publisher, but what we have really unlocked here is a Business Model where it makes sense for both parties. Taylor the Senior Vice President to discuss in washington, it is Daniel Coffey, Senior Vice President of News Media Alliance studio, kurt wagner, who covers facebook for us. Give me your first thoughts. This is like the 10th time that facebook has attempted to make nice with publishers. Studio, kurt wagner,all these s to try and make publishers feel like they are getting something in return and not just putting stuff on facebook for free. I think we heard a little from Mark Zuckerberg about the business. I think there are two potential lines of revenue. I think that is better than some of the efforts they have made in the past, but you have to understand a lot of publishers have been burned multiple times in the years before, so everyone will kind of look at this through a skeptical lens. Taylor danielle, from your take being involved in the news media, what are your thoughts . Danielle please view this as a step in the right direction and valuing the quality news that have fueled their ecosystem and allow them to flourish and make a tremendous amount of money, but is this adequate enough to sustain the news industry into the future . No, we dont believe it is. I dont even think facebook believes it is. It is a step in the right direction. It does not cover all the local communities and local coverage that goes into a national story. It is a step in the right direction, but it does fall short. Taylor a step in the right direction, but kurt, talk to me. How does this help facebook besides helping its image . Does it help the bottom line . Kurt i dont really think so, other than it keeps publishers trying to have a relationship with the network. You see bloomberg, washington journals, New York Times lead leave facebook, i think that could hurt the bottom line. It is certainly a goodwill gesture. We hear you, we believe in journalism, we believe in the mission and as a result, we want to help you out. I dont see a financial benefit for facebook here and in some ways, that is a good thing will stop we should full disclosure Bloomberg News is a publisher in facebooks news tab. Danielle, let me bring you in again. How does this help the image of the company because frankly, they need it. Danielle sure, there was no secret and you were just talking about the bottom line as to whether it helps facebook. Of course it does, it helps the readers consume content or data based on the readers that they gather off of us. That is essential to their current and future Business Model. When they proposed to the terms they did, it was in a way that you would never conduct a normal negotiation. When it is take it or leave it, and it is done in secret and publishers cant talk to one another, that is not a traditional that is not a functioning Business Model, so it does serve their bottom line and it serves their ecosystem, but what we are looking for is how it comes back to us, the originators of the content. Taylor well, and theres a lot of National Organizations participating in this. Zuckerberg did talk about how it may or may not impact some of the local coverage hit hardest. Take a listen. Local papers have probably been hit hardest. Also, one of the other products we are working on is we were building a separate tab called today, including local news. Earlier this year, we announced a 300 million commitment to journalism and helping a number of publishers, but a special focus on local news. I dont pretend that any of these steps will be enough or we as one company will be able to solve this issue. Taylor danielle, your thoughts on if it goes far enough to help some of the local coverage that has been hit the hardest. Danielle it is difficult to determine whether the traffic that comes in is specific, but he today and or not, but the monetization that you get from the advertising Business Model is pennies. Portion of what is coming to us because of the broken system that the house is looking into, but as far as what we are experiencing, we are not getting adequate return because the traffic that generates the advertising dollars is not enough to sustain the news content that we generate. No, it does not help the local communities and coverage that we do with local newspapers that need to be able to get a sufficient return on their investment and with the news tab, it did not cover everybody. It covered the markets and while we are happy about that and it is a step in the right direction, is it covering local communities where they need it most . It is not. At the Daniel CoffeyNews Alliance and kurt wagner, thank you both. Pg e is telling customers that they may lose power and this comes after kevin newsom declared a state of emergency for the counties of sonoma and los angeles because of the kincade and tick fires. Coming up, you cannot deal what is there. That is the approach they are taking to protect your data. We here from the ceo how they can achieve that. That is next. This is bloomberg. Taylor securing Customer Data online is a hot topic across the globe and one company says it has a unique approach to handling sensitive information. Very good security lets Companies Access that information without ever needing to hold on to the data themselves. It just secured a 35 million funding round led by Goldman SachsMerchant Banking division. For more, i want to bring in the ceo and founder. Talk to me about the funding. Congratulations. What are you using the money for . Thanks so much, taylor. Is a pleasure to be here. We are very excited to partner with goldman. Both marshall and i are very thankful, but really the big idea is to completely democratize best in class data and Privacy Security for companies of all sizes, so the funding is going to follow where we will invest in r d and hiring sales, marketing and expanding on our growth that is happening growth. Taylor and huge investors, horowitz, Goldman Sachs, bigname backers, why are they interested in you . They see a shift in the market coming. One of the biggest issues we see is previously, you had to release data going and an out of data centers and that approach 10 years ago, 15 years ago, but now data, which we called an asset before, is becoming increasingly a liability, so when they see a shift happening, how do you catch up with data in advance and build a solution that can catch the market with data all over the place . Is this purely a data privacy issue. Have some of the investors, namely Goldman Sachs, because they have talked a lot about Digital Currencies and making a play in that area as well. Mahmoud we are very excited to partner with goldman. Theyre obviously a very respectable partner. I cant comment on a specific initiative, but i can say there are a variety of good reasons why they took an interest in us. Taylor you started out this conversation by saying you are a classic Silicon Valley company. Talk to me about valuation and if you are cash flow positive in and when you can expect to see some profitability . Mahmoud we can be profitable if we choose to, but we purposely do not. Toare looking for funding accelerate growth. We took the funding and wanted to move faster than if we had just been by ourselves and so the idea is that next year or the year after that, we could be profitable, but what happens if youre able to get to that position today . The reason we took that money to accelerate two years, three years of our timeline, so we are not too worried about cash flow volatility. We can be, but what we want to do is capture the market today. Taylor you want to see that path to profitability. Thank you. Shares of amazon in the red in an Earnings Report in order to increase spending for getting packages out in one day. That is something that investors were trying to reassure be reassured of in a column on wednesday. The cost side, throughout density and other things, will other things will improve over time, but for now, there is some startup pain in adding capacity. Taylor brad, talk to me about this. It was the profit decline everyone is worried about, but are you shrugging it off because you know every time they invest, revenue eventually follows . Well, taylor, i think it is safe to say the market is shrugging it off. The stock is down 1. 8 , well above the market lows after trading yesterday where it was down like 7 . This is a movie that a lot of these longtime amazon investors have seen before and it is a happy place. People were worried that Amazon Retail was slowing down and now it seems like next day delivery has reaccelerated it. Yes, the profit miss, but amazon didnt have profit for years and that is nothing to the longterm investors and analysts. As to whether pays off, it looks ike next day shipping didnt think it was much different from sushiday shipping, but so Many Companies like walmart and target have caught up with sushiday shipping, so amazon is trying to go further and read a gets competitive mode around its main business. Taylor if one day shipping was so good, why did they come lower on crucial holiday sales on the top line . I think the history frankly on this revenue guidance is they are always conservative. I dont put much credence in that. I think the topline surprised this quarter and we will see what it does for the holidays. A smaller than average couple of days between thanksgiving and christmas and how some holidays abroad including india, some of that went into the Third Quarter. We will see. I think the pattern is next day shipping does make a difference. Is unit growth at amazon slowing down and bounced back up by several Percentage Points so the evidence so far is next day shipping moves the needle but we will see. Taylor you are also going to the sooner than you think conference. Im not cool enough to call it by its acronym. You are out there next week. What are you looking for . We have this conference three times a year. Once in asia, once in europe, and wednesday it is in brooklyn. We try to take a different approach instead of the same executives of the same companies saying nothing, we are talking about solutions to the moment that tech finds itself in. We talk about the antitrust investigation into the big tech companies, panels on privacy focused design and security inside companies. We have the great design emphasis from google talking about how we can have a more productive relationship with the technology and your colleague caroline will be cohosting with me, and we designed a deepfake video involving her and she is going to get into deepfakes and the impact they are going to have on our culture going forward. Taylor this is also notable because it is in brooklyn and not san jose, San Francisco, not in Silicon Valley. In all your years covering tech, have you started to see this shift . Are we losing a little of the tech to the east coast . Brad this is more about connor programming. There are plenty of conferences in california. We thought we would experiment with an event on the east coast and we have the ceo of the next mets coming to talk to us and the nba is interested in a nba posh interesting relationship with one of its most important partners, china. San francisco and Silicon Valley, still the center of the tech universe. If there is a threat, it is an in asia and beijing and shenzhen, but look. Tech is growing and i think it is more dispersed across many cities including new york and washington, d. C. Than it has been historically. Taylor as long as it is in San Francisco, we can keep our jobs another day. That was Technology Editor brad stone. Coming up, gains for intel after on friday after the company gave a profit forecast. We hear from the company posh ceo bob swan next. This is bloomberg. Taylor intel gave an update for the Fourth Quarter, improve demand for Semi Conductors that power cloud computing. Bloombergs paul allen and shery ahn spoke with bob swan earlier. Take a listen. We outperformed in the quarter and we expect about 200 million of that was pulled from the Fourth Quarter in light of games idea about availability to products, so not a whole lot of it, but some of it, but despite that, we did take up our fourthquarter outlook as well. In june, you said you were reviewing your supply chain in the context of the trade disputes and the u. S. Entities. Im wondering if you could share any insights from that review. Are you making any changes . I think for our customer base, we have china is a large market for us in terms of customers for china consumption, but also for global oems that have more of their assembly and test operations in china, so what we are saying in light of the debates around tariffs, we are trying to work with our customers to ensure they can get their product most effectively by leveraging our Global Supply chain to diminish the impact that tariffs could have on their supply for global markets, so we have a wonderful Global Supply chain and we work closely with our customers to be able to deal with the dynamics we are wrestling with. I would say that we are encouraged that china and the u. S. Are talking because we are a strong believer in global trade and we dont find tariffs to be a constructive mechanism for global trade, so we are very encouraged that the two sides back to the table. In the meantime, we will leverage our Global Supply chain competencies to mitigate the impact on customers around the world. What are your shipments of huawei looking like . They has been blacklisted by the u. S. Bob we dont really get into talking about specific customer demand. I would say huawei has been an important customer of ours and we continue to see them to be an important customer going forward, but at the same time, we have to adjust and a doubt to and adapt to the laws in the markets we serve. We will continue to serve them to the extent that we are allowed to. Under the current entity lists. Are you getting temporary waivers and licenses to supply to huawei at the moment . Bob i think the Semi Conductor industry, we have put applications and to get licenses to ship, but we have not heard back yet. We hope to hear sometime soon, for we have not read back yet. Taylor that was intel ceo bob swan. And another ceo is aiming to take its popular music stream is he spoke toer us from the new york stock exchange. At a time when the Management Team is mature and the company has a leading advantage on the market, then we can make the decision whether or not it should go public. Taylor despite the trade tension, they still chose to go public in the u. S. Following in the footsteps of its parent, which went public on the nasdaq in 2000. Bloomberg caught up with the ceo following the companys debut on the new york stock exchange. Our Parent Company has always been a u. S. Listed company and we really like the markets because they have treated us well. There has been a lot of return for u. S. And chinese investors all over the world, and for us, we think at least we are not doing trade related business and education i would expect it to be a very good way to connecting the u. S. And chinese people. One of my last questions, what was your reaction to the opening price, about 20 lower . Then the ipo price. Do you think investors are pricing the right value . I think we operate for the longterm. Getting to ipo is an exciting step for us and it is a very good way for us to attract that better talent, to be a a more respected company. We think it is the right move and we are very confident in our plan, so we think this is a new starting point. Taylor that was the youdao ceo at the new york stock exchange. Coming up, we recap the biggest stories in tech. Amazons disappointing forecast. Fourth Quarter Court past, zuckerberg defending libra and capitol hill and the downward spiral that is weworks valuation. All of that is next. This is bloomberg. 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