And, antitrust allegations. An online merchant accuses amazon of using expensive the just six to move good, a tactic that could be driving up consumer prices, but first to our top story. One of teslas detractors just got twitter burned by elon musk. After he lashed out, the tesla chief offered him to take a tour on the companys facilities. Discuss, dana hull joins us. A little of the backstory. This has been a longrunning battle. Out anuarter he puts investor letter and e line loves this, looks for this and sent a tweet expressing sympathies. Tear,las stock is on a 40 over the last month. They have to explain to investors how they got the thirdquarter wrong. Tesla stunned everybody with a profit. Remembering something that happened earlier, signofft Elon Musk Twitter . It is important to know that einhorn claps back. He responded and said i will take your offer of a tour of facilities. Lets start in buffalo. Buffalo is where tesla builds its solar panels. The state of new york wrote down the value of the investment the last month. Happen . Ikely is that to buffalo,uld all go to but i think it is just like testosterone fueled. Elon musk vice to enjoy harassing the shorts . I think he enjoys it when he can burn them. They have the ability to shape perception, you talk about burning the shorts, he is offering to send them again. This is sport for him. Basically said we will see. Website thata seems to be chronicling elis exaggerations. Who gets the last word . Tesla had this amazing quarter. What does the Fourth Quarter look like . How are sales in the u. S. . Thank you for joining us. A coalition that includes and cable titans, is going to crack down on password sharing. We are joined by bloombergs lucas shaw. A great article by your colleague gerry smith about this topic. Sharingus about account and how big of a hit is it for netflix and Cable Companies . It costs the tv business somewhere between 5 billion in 10 billion. If you think about netflix, there are estimates that at least 10 of users are using someones password. And you areath looking at billions of dollars. N just netflix alone the challenge here is fixing this in a way that is consumer friendly so youre not asking customers to enter in their passwords every day or every week. What are the techniques available to these companies were they dont end up harassing people . A couple of the techniques are making you change your password pretty regularly to make sure friends cannot just store the password. I have a password to someone elses service that ive had for years and it has not changed. Regularly,nged it they may not be able to access anymore. A also talked about two factor authentication where you get a text message to your phone which makes it only the person with that account can use it. There are more extreme measures like having to use your fingerprint. Season account they think is violating, they will send an email saying is this really your account . Ago remember a couple years Reed Hastings said password sharing is something they have to live with because there are so much legitimate sharing. Has netflix changed its tune . Been fairly consistent in that they dont [no audio]to come backople will and eventually someone sharing will sign on, but netflix has reached a point in certain markets, especially like the u. S. Whether where their growth is slowing and they can squeeze out extra growth if they go after people who are sharing will stop sharing. Will this pushnt people to using illegal methods . I think its a big risk in other countries and to some extent of the u. S. You haveyou have seen it drop is where netflix is possible. You are getting a good service with lots of different tv shows whereas piracy remains very high. Extreme, i think you could see it spiked because if there is a new popular show what people feel like they cant access it without cable, they will more than likely find in the legal way to watch it. The lucas access to shaw netflix account . Friends. Other than my i will confess my mother is on my netflix account. Thank you for joining us. Withg up, we catch up wired chief editor nick thompson. Us, check us out on bloomberg radio. This is bloomberg. Facebook employees repeatedly shape what they viewed as unethical practices by the company. Those concerns voiced in 2012 and 2013 were overruled by senior managers including Mark Zuckerberg who argued the survival of the social network was more important. Were joined by wired editorinchief nick thompson. Thank you for joining us. Glad to be here. So much to discuss and you have written some Great Teachers about facebook over the last year years. Lets start with political advertising and the companys position that private companies should not be policing public speech. He agree do you agree and do you think it will sustain . There so many layers to that question and my opinion is complicated on that. I think in general political advertising on social platforms is a net good and it creates the opportunity for upstart campaigns to challenge incumbents, so i think you should start with the principle that it is a good idea. Policy whichooks is that politicians can lie, but citizens cannot is very weird. Why would you give politicians more of these rights and citizens . I think it is backwards and strange. Do, i think facebook should they should allow political advertisements, but check them just like they do organic content. Public dorsey was very in disallowing political ads on twitter, making the argument prepared for the ways that politicians and their campaigns are abusing free speech. Did twitter take it too far in your opinion . If theres anything that our political discourse is not prepared to handle this twitter, not the advertisements. The biggest challenge for dorsey is making sure we clean up and figure out how to solve the problems on twitter. On the question of advertising, i understand the position and respect the position. It is a clean position. I dont think it is entirely the right decision. Thepeaking of facebook, company is rolling out a new tab. Cap do you think that will make a difference in the way people consume news on facebook . I dont think it will make a huge difference. What we have seen with those tabs features, people will continue to read in the Central Place they read. In general, i think the news to tab is a good thing for users. Unless it becomes an excuse for removing news from the main feed, i think the overall net positive, but a small net positive. Bloomberg is part of the news tab. [indiscernible] do you think this is a game changer or needle changer for the News Business . It is neither a game changer or needle mover. Earlier, i referenced another asset of facebook which is that a trove of internal communications were leaked and they show the executives disagreeing back in 2012 and 2013 over the extent of which facebook would allow competitors, at that point it included whatsapp to advertise on the social network and Mark Zuckerberg was saying no, why would we allow our competitors to do that, but some of his top lieutenants disagreed that it looks bad. Have . Mpact does this i think of this point we are immune to old facebook documents shocking us. I think they dont paint facebook and the most attractive light. Zuckerbergs position that the platform should not be a tool for competitors is something that some engineers will disagree with, but i dont think his position is a terrible one. We holdll be where lieutenants and they wills poll lieutenants and then it will disappear. What i think it shows you about the thing that stuck out the most for me is they were quite cynical about privacy. What we have seen is facebook saying lets make a decision that is in our business interest and justify it by saying it is in the user interest and that wears me out. Weirds me out. You are celebrating the magazines 25th anniversary. Anaw you asked patrick interesting question on stage. You asked him if he was still optimistic on technology and i want to put that question to you because wired has typically been optimistic. Are you optimistic . I am optimistic. I think one of the things power tog today is the actually make things better, but i think there is a fundamental difference between the way i see wired and the way our early founders saw wired. I dont think the role of the magazines to celebrate and promote the industry because the position in society has changed and the role is to investigate. Say that moment with , the fastest talker and one of the smartest people we will ever converse with. I think he caused. It was a wonderful moment. Give us one more highly afternoonay this or tomorrow. I am talking to the ceo of slack. They are an Interesting Company because the whole philosophy is to make organizations more agile and so one of the things im looking forward to asking him is doing have any evidence of that working . Or is it just another way to organize workplaces . Also tomorrow morning, a run with marathoner nick thompson. I give my regrets on that, but i wish you luck on that. It is not just me. In olympian will be there and olympian an olympian will be there too. [no audio] late friday, lawyers from the filedent said they will papers with the u. S. Supreme court to take up the issue. They will fire paperwork by november 25. Coming up, Sun Microsystems cofounder says people should accept that they have no data privacy. That is next. This is bloomberg. Further is considering cuts to subsidies for allegedly ago purchases. Regulators have been discussing the proposal, but holding off until they can look at sales data the next few months. It could deal another blow to a worlds a once burgeoning industry that is dealing with a slump. Sun microsystems cofounder is concerned about how congress is approaching regulation of the tech sector. He discusses his views earlier today with david westin. Government here to help, i cringe. I have watched the federal billion torom 70 4. 7 trillion next year. Onhink we need to cut back regulation. I think Congress Moves at the speed of congress and not the speed of the internet. I dont want to see private companies being managed and free so i haveng managed, not been a favorite of breaking of facebook. That is not the issue. I said a long time ago you have some you have no privacy, get over it. I dont believe if youre getting a free product like you should have an expert edition that your data will be free. I said anything that gets digital digitally is a tattoo and very hard to erase. The only people who have been able to erase anything are the clinton 30,000 emails. Breaking it up is not going to be the problem and trying to regulate, i always get frustrated with the phrase hate crime. I think all crimes are hate crimes. Crimes. We need to get the political discourse off off of social and i have suggested we need to forte an equivalent of npr that political conversation. We are talking to the cofounder of Sun Microsystems. Lets put aside that and talk about innovation will stop one of the things that has been expressed is if you get too big [indiscernible] if you go back to standard oil, that was the concern. Are you seeing a curtailing of innovation and success . That is a great question and hernych question because really, what does facebook keep me from doing in my life . There are lots of ways to take a picture of my dinner and ensure that so i dont feel like im having loss of choice. I have lots of ways to communicating with people and the people that might be upset our advertisers because digital itertising, three fourths of is google and facebook and they are gaining share so they might have a beef, but the consumer, you dont have to use facebook, you dont have to use twitter or google products. Innovation is stopped in biotech or Autonomous Vehicles or anything because of those vehicles because of those. That was scott mcnealy. Coming up, the week in tech. Lockup. Estors fleeing that is next. This is bloomberg. Brad this is bloomberg technology. Im brad stone. Now to our weekly look at the top stories in tech. A terrible week for softbank. Their investment down to wework and uber triggered a 6. 5 billion loss, but ceo Masayoshi Son is sounding hopeful about the office space provider. Time will solve the wework problem. We will make money once the weworks building portfolio is allowed to ripen. How . Stop the new Building Development and profitability will improve and we will expect a cost to go down by half or more. It is that simple. Brad part of a plan to profitability for wework is to sell off the noncore businesses. The plan was confirmed friday. Joining us from new york, author techont be evil how big betrayed the founding principles in all of us. Thank you for joining us. Guest thank you for having me. Brad Masayoshi Son sounding embarrassed, saying he made mistakes with wework. But then you see a cfo doing interviews, saying nothing will change with the vision fund. What is happening at softbank and what kind of lessons have they learned . Rana it feels like 1999 to me. It feels very frosty. I think the fact a fund as big and bloated as softbank exists in its current form is kind of a marker of where we are in the Technology Sector at the moment. There is so much debt out there in the books. Softbank, a lot of people think this maybe should have been bigger. I dont think just saying we are going to cut some costs and wework is suddenly going to become profitable is really realistic. Its interesting because wework is actually taking Collateral Damage where the real estate was located. You are seeing property prices in london and parts of new york being affected by this. I see this really as a Tipping Point for the sector in general. Part andt is parto parcel of company staying private for a long time, having their valuations bid up and up by larger venture capitalists. It is amazing to me these large funds are still being raised. I think at this point, investors are looking around and saying we kind of like the idea of profit. This whole idea of grabbing market share and worrying about profits later is over. Brad lets talk about another company that has been affected. Uber. Shares after the lockup period expired are at an alltime low. What is happening to uber . Is it fundamentally the same story or does th is it the struggle of dara and the Management Team to move this company to profitability . Rana uber has had governance issues specific to that company, no doubt, but i think it is a fundamental Business Model question. I think the Business Model for a lot of big tech unicorns has been to go in, grab as much marketshare as possible, get data as much as possible and worry about the profit model later. Once you go public, that logic does not really work anymore. What worries me is i think that Business Model has distorted the entire tech sector. I think not only is it raising questions of regulators in terms of antitrust issues what you are hearing more and more about from the right and left, but it is really killing innovation. It is really hard when you are coming up against a firm like uber or wework or any of the big players that have eaten there sector to compete. It is a real problem for innovation. It has taken the valley away from where it started out. Brad another highlight or lowlight of the week are those communiques from facebook executives, just battling over whether rivals, whatsapp at the time and others, should be allowed to advertise on facebook. What does it tell us about the relationship between the Big Tech Companies and their employees . Rana i think that is a fascinating question. Two thoughts. One, this is not unique. There have been people in Big Tech Companies from google to facebook raising alarms about Different Things for some time now. They often have not been listened to. But, i think we are reaching a a Tipping Point where there is almost a civil war in these companies and that will ultimately affect valuations. Where does their value come from . It comes from data, intellectual property and human capital. Their talent, their engineers if you start to feel that people dont want to work at facebook or google because they are concerned about how the company is being run, that will have a big impact on their bottom line. I have seen some letters from Institutional Investors that have been raising concerns capitalow, how is human within these companies being managed . Brad i want to make sure we talk about your book. I was such a fan of your last book, which argued that wall street and the financials asian of the American Economy was really biased against mainstream. Here, you turn your eye to silicon valley. Talk about what brought you to this new book and silicons valleys responsibility for the social ills we have seen today. Rana i always like to follow the money. I noticed there was a big wealth transfer the last 10 years from the Financial Sector to the Technology Sector which led the markets up over the last decade may lead them down, i think. You see tech growing incredibly wealthy. A lot of that money has been offshored. Share buybacks. A lot of the things that a lot of people feel have not really benefited main street but created a lot of inequality, a lot of debt. A financialized growth but not the real deal. At the same time, you have these big stories around election manipulation, the cognitive effects of social media and platform technology. What i wanted to do in my book is chart the 20 year history of how the valley went from utopia to dystopia and connect those dots between economics, politics and brain science. Kind of shed some light on where we should maybe go. I think a couple of things we really need to consider is a should this industry still have the opt out clauses for liability that were carved out in the mid1990s . I would say no. Do we new need new thinking about antitrust . Absolutely. In an age where data is the new oil and transactions are happening in barter, i think the whole antitrust thinking should be thrown out of the window and w