Transcripts For BLOOMBERG Best Of Bloomberg Technology 20240713

Reach. And the u. S. Government says russia, china, and iran will seek to meddle in elections going forward. How vulnerable are we . We get to opinions from ethical hackers. It was a week of reckoning for uber. They posed selling restrictions for early investors lifted wednesday, making it one of the most actively traded stocks shares some record lows, not a good look. The stock is down 40 from its debut. For some perspective, i caught up with guests. A lot of people are just sick of waiting around for it to get better. We saw the stocks fall. Again, there are some questions around when this could continue, considering a number of early investors are not underwater and could see potential upside. Taylor walter, the volatility today, is this a day issue, weeks issue or a months issue . The average daily volume is 15 million shares. As lizette was saying, you are talking about one billion shares coming off of lockup. Some of those shares are probably not going to trade. I dont think softbank, who owns about 2 million or so of the shares, are selling any time soon. They are pretty bullish on rideshare and have a number of investments. But the founders of the company, we will see what they are doing. There are early Venture Investors and a host of other investors. It could take more than a couple days to digest through this. Taylor i want to take a look at a chart for the bloomberg audiences inside the terminal. It is the bearish sentiment around this stock. 1. 4 for every call, showing more bearish sentiment into the into this. Put that into perspective for us. We knew that day was going to come. Do we expect more Downside Risk ahead . What are investors saying . Investors are taking their cue from the results of uber who reported monday. At that time, it was mixed, noisy. And the upshot were a couple of things. One of them was that growth was the slowest at 29 of quarter a quarter than has ever been reported since the Company Began sharing that number. Thats not a good thing. This is a company that has always sold investors on its Growth Potential as it went to 60 plus countries and entered things outside of the core ridehailing into grocery delivery, autonomous driving, helicopters, gig worker matching, etc. So thats one thing. You know, whether it will continue or not, anyones guess. I know that a lot of people focused on the fact that it projected to even be profitable by q4 2021. That is a projection that has never been shared before. It was supposedly to reassure investors, but it doesnt seem like it worked. Taylor walter, does the bearish sentiment line up with the fundamentals we got from the company this week . Part of it, the selloff in these types of stocks, is not happening in the last couple days or weeks. It has been going on for months now. Whether you call it growth or momentum, this has been a disfavor. There is no positive catalyst on the horizon for the company. The incremental competition they are feeling which resulted in a deceleration of growth, which is an incremental negative, that doesnt seem like it would stop anytime soon. I think the catalyst of saying we will reach profitability in 2021 was probably wasted ahead of one billion shares coming off of lockup. It is still questionable whether they can actually hit that target. In the meantime, you have a competitive eats business, you dont have autonomy coming as a potential catalyst anytime soon. Its just hard for investors to own these when you are relying on things like revenue multiples to base your valuation. Taylor i have a little bit of a bone to pick. When we talk about adjusted, meaning the company is profitable, and to be clear we are not talking about net income or bottomline profitability, are you ok with adjusted positive by 2021 or would you see it translate into net income . Im fine with it. Im sure most investors will be fine with it. I know it makes for better headlines to focus on a net income number, but the reality is it is closely associated with the cash in the company. You also have to look if it is a capitalintensive business, which this business is not. If they can get to that positive, you will find a Broader Group of investors willing to invest in this name and put multiples on it rather than relying on a multiple revenue or bookings. Emily that was my chat with bloombergs Lizette Chapman and walter piecyk. We stuck around to talk about softbank, where things are not much better. They reported an Earnings Loss in Companies Like uber and we work. Softbank chairman messier she son Masayoshi Son remained defiant, saying they will make it profitable. He is still up on the vision fund. They have booked up to 15 billion of unrealized gains. This is a big setback that the that went right down in the vision fund and aggregate was 9 billion. It was more than just what was happening at wework. There were a couple of other billion that occurred. Overall, he is still up on the vision fund. He looked at this and said, look, we will have 15 massive winners, 15 awful losers like wework and the rest of them are doing soso. His investment style is more about having massive winners like alibaba, putting in 20 million and its worth however many billion now, in order to drive returns. While they talk about more conservative investments, what he is sticking to what he really wants to do, finding really big winners to find returns. The bigger issue for the company, which is kind of a sideshow, they have a big deal out there right now getting challenged by state ags. Tmobile is trying to bribe ash bride buy sprint, tmobile is burning cash. They have to go to court. If they lose that, they are kind of stuck with sprint. If that deal can get approved, if tmobile can buy sprint and get that off of his back, it removes the debt from the balance sheet. Hes got a great asset in tmobile that he can borrow against and invest in the vision fund. I think it gets softbank back on track. A lot of what softbank investors should be looking at right now is how the sprint court case is going to go with state ags. That can be a catalyst for the stock. Taylor rightfully so, second sentence of your note hot off the press says the sprinttmobile deal is the biggest catalyst for the stock this year. Is that what you need to see to sort of, not save the company, that sounds too drastic, but to at least get the stock to move to the next leg higher . Softbank has a lot of things going for it in terms of investment. Other things can help. Two thirds of the investments in the portfolio, they were the last guy that invested in it. If through an ipo or another round of investing in the private markets, you can get thirdparty validation for investments, i think it would also help softbank. Maybe if uber, like we talked about in the last segment, if gene uber can stabilize the eats business, that would provide more credibility. Right now, they are losing a couple billion dollars. Any validation of investments, any validation of the evaluations set on investments, or a favorable turnout in terms of tmobile being able to buy sprint, either of those things i think would be a positive catalyst for a stock that is really still trading at probably a discount. No matter how conservative you are, probably still trading at a discount. Lets not forget alibaba is still a massive investment that softbank has and supports the overall valuation of the company. Taylor your general thoughts on softbank and the vision fund sort of decision to put more money at wework some people have called it putting more money at other bad money. Your take . Masa was insistent today that it was not a bailout to save a bad investment, but it certainly looks like that. You took a Company Valued at 47 billion and put new money in at less than 8 billion. To me, that sounds like a company that was pretty desperate. I dont think its a good sign in terms of the investment. It was softbank making the investment as opposed to the vision fund. That tells you the vision fund partners, which they are hoping to sign up to the second vision fund, were not willing to come in as the investor to effectively bailout wework. They were effectively willing to let the investment kind of go. This money came from softbank. The question is lets say sprint faces the same issue. Lets say the tmobilesprint deal fails. Is softbank going to come into sprint and have to write another 10 billion check . Sprint is a company burning money that needs to invest in the network. Should we expect more . Thats a slippery slope for a company. You dont want putting more want to be putting more money into bad companies. You want them to put that into new Growth Companies that can be among the 10 or 15 names he thinks can be huge winners five or 15 years from now. Taylor coming up, choose your spin. Peloton beats estimates but there are questions about the cut about the path to profitability. They say it is part of the plan and hopes wall street can look to the long game. Check us out on the radio and in the u. S. On sirius xm. This is bloomberg. Taylor peloton posted a loss with higher than expected subscribers and revenue growth. Still, concern exists over how fast the company is trying to expand. John foley spoke to us after the report. John it will be profitable over the next couple of years in the u. K. And canada. We dont need to launch more to get to profitability. We may choose to invest in those things over time but it not needed for profitability. Taylor did his comments and vince analysts . Convince analysts . I got an analyst on the phone. The company did report an impressive quarter. Objectively speaking about the numbers tell a good story. They are growing year on year five quarters in a row. They have a stable growth margins on the subscription side of things. Things are trending in the right direction, make no mistake. But given Investor Sentiment, as we talked about with uber, investors want a pathway to profitability and what they are telling investors is that they will invest heavily this year, bear with us, and year, we will show real progression. I think it is just about patience, how patient investors are willing to be in willing to accept the story today. On top of that, you are selling a very expensive product. We dont know how large the market is. A year goes by, and if we are in a macroeconomic slowdown, then what happens to the pathway to profitability . That is the worry investors have and are unwilling to stick around with the patients john is asking them to have. Emily are you sticking around . The ceo did say we could be profitable tomorrow, if we wanted to, we just want to invest in growth. Are you comfortable knowing that . Over the longerterm, i feel we would be comfortable. But today, given Investor Sentiment and heavy losses and that the company just acquired manufacturer in taiwan, they are overburdening their cost structure. Investing in a lot of things and we will wait on the sidelines. Taylor does it come for you that comfort you that the ceo said they dont have a lot of competition . I would take the other side of that. From a competitive stand point, there is nothing like the bike on the market with the integrated ecosystem content, bells and whistles. But when you look to where can i work out today, where am i willing to spend hundreds a month, there are a lot of options. Also, there are a lot of platforms. So i think if you take a broader view of the options that consumers have commit it is getting more and more saturated have, it is getting more and more saturated. We have not seen longterm delivery of that yet. Maybe peloton will show that pathway, but we have not seen that yet. Emily that was m km partners rohit. Lackluster performances mixed with the implosion of we work all make for examples of investors shunning moneylosing startups. The Banking Sector is feeling the sting as David Solomon made clear this week. Goldman sachs has investments in we work and uber. He spoke to matt miller in berlin on tuesday. Is important you have a Business Model that can generate profitability and there is more market discipline coming into play and i think that is healthy. Emily i asked our correspondent about the notion that markets are becoming more adept at discerning whether companies have a clear path to profit ability. I think the markets have been really irrational for a number of years. Frankly, this irrational type behavior that is driving these skyhigh valuations has to come to a reckoning. Guess what, everyone is not amazon. Finally, people are starting to tighten the reins. It only took one major flop for people to turn around quickly. We have had the head of Investment Banking and citigroup at citigroup tell us that for Bloomberg Television as well. People are already starting to tighten the reins earlier this summer. The talk is getting a lot louder for banks like goldman sachs, j. P. Morgan, that stuck with a lot of these companies through very tough times. Taylor talk to be more about jamie dimons comments, saying private markets are not real valuations because you dont have a price discovery, you just have an investor telling you what it is worth. Sonali jamie dimon is saying something similar to David Solomon, that one investor does not set a valuation. A market of investors sets a valuation, so things can be volatile until then. Jamie dimon also said something that softbank is also addressing, which is changes in corporate governance. That is something we have been waiting for forever here. Softbank, right now, according to the financial times, is thinking about tighten the reins tightening the reins in terms of corporate governance. That is something you heard jamie dimon also address. Taylor you know, another story that caught our attention here as we look at the tech landscape has been robin hood markets. There was a story coming out that said basically, put down a little bit of a deposit on margin and you get infinite leverage. There is a glitch in the system. What is it . Sonali basically, you have a certain set of robin hood users who are selling calls and that money is being counted in that users capital. And so, this is such a timely story. A week away from money 2020, thousands of people were meeting about the future of fintech. Once we are borrowing from a firm, youre becoming a bank and a personal hedge fund. You are sitting here and having to deal with issues as you scale and grow. Robin hood, as we know, is trying to not only grow but has considered a banking charter. This Never Looks Good in between, but they do say it is isolated. That said, the users that have been doing this say they have levered a 4000 investment into a Million Dollar investment. They are pretty insane trades we are seeing that a lot of people are bragging about. Taylor coming up, chipmaker qualcomm reports earnings as details looking up even as trade tensions continue. We explain. This is bloomberg. Taylor qualcomm gave a strong forecast when they reported earnings wednesday. They indicated smartphone demand maybe picking up after a prolonged slump, also projecting Strong Revenue growth with 5g technology which debuts later this year with samsung headsets. Theres also wall street optimism over a renewed relationship with apple for future versions of the iphone and 5g. Ian king filled us in. The whole conversation was about their outlook for Smartphone Markets year. They are saying it will return to growth again, as much as 1. 8 5 billion devices being sold. More importantly, 5g devices will be shipped next year. Taylor we also know they are looking could be looking at another year of declines. Is that due to the Smartphone Market and could we start to see top and bottom line growth . They could be back to growth year on year as early as next quarter, but it has been rough for them. There has been this hideous dispute with apple that took away big customer and a dispute with huawei that has not been solved. And on top of that, you have people getting bored with their smartphones and not seeing anything exciting to the point that they did. They are saying that phase of the Smartphone Market for them is over and things are going to come back. We spoke to an analyst who says that is maybe optimistic. So far, people like what they see. Taylor how much of a tailwind is apple . It means on getting paid on licensing already. Even though they are not in the iphone at the moment, they are getting paid because their technology is, right . They already won that one, but it really wont cut it in terms of a chip unit until some point next year. Probably this Time Next Year when apple comes up with the next version of the iphone. Taylor a Morgan Stanley analyst coming into the call said the Fourth Quarter, which is what they reported, looked good, but it was really next quarter that might have been too optimistic, but if shares are rising, do you get a feeling maybe they were not too optimistic . Are investors pretty happy that maybe that next quarter is right in line . I think theyre getting some credit for having been conservative about the quarter they just reported and proved through their own execution they actually did better, so that buys them credibility when they go out and say things are getting incrementally better again. Obviously, people like that. People want this company to go back to growth. Taylor finally, management naming a new cfo. How big of news is this . This guy has been with them a long time. He has been in the chip division, basically the head of finance for that chip division. On the call, he answered a lot of questions. He was very entrenched in the company. He understands the Business Model. Theyre not getting an outside model. Theyre not getting an outside perspective, they are getting somebody who knows this company. Taylor coming up, disney gets ready to unleash its streaming service but its earnings were on the radar this week. We get perspective on a global scale next. Bloomberg technology is livestreaming on twitter. Check us out and be sure to follow our global breaking news network at tictoc on twitter. This is bloomberg. Here, it all starts with a simple. Hello hi how can i help . A data plan for everyone. Everyone . Everyone. Lets send to everyone [ camera clicking ] wifi up there . Ahhh. Sure, why not . Howd he get out . a camera might figure it out. That was easy glad i could help. At xfinity, were here to make life simple. Easy. Awesome. So come ask, shop, discover at your xfinity store today. Taylor welcome back to best of bloomberg technology. Im taylor riggs. This week we adjusted the clocks and fell back in the u. S. And we now have the opportunity to check in with our colleagues at bloomberg daybreak australia. On thursday we focused on a company that is arguably the most global in reach and investment, disney. The media giant reported its Fourth Quarter earnings thursday. The last Earnings Report before the highly anticipated launch of its streaming platform. Kathleen hayes joins me in getting insight from their managing partner porter bibb in new york. Porter the movie industry and the theatrical movie industry is not going to last more than five or 10 years, but where disney has positioned itself, it will be the dominant content producer, distributor over the top and streaming. And the market has finally caught up to bob iger and realized disney owns that space. Taylor porter, we could talk about the Earnings Call and numbers. Frankly, no one cares. What numbers do need to see to feel confident they can take on netflix . Porter they are going to lose money for at least four years, maybe a little longer. They are talking about reaching by 2024 bob iger has said we will have 50 million paid subscribers. The very smart thing he did right away was price it at an irresistible level. If you are a parent and do not subscribe to disney plus, i think your kids will probably leave home. It has got so much recognizable and irresistible content. No one can touch the huge amount of Library Material bob iger is making available for 12. 99 a month. Kathleen a bargain. Porter its a real bargain, and hes thrown in espn and hulu. So for that amount. Kathleen how can you go wrong . What kind of revenue, what kind of profit and positioning can this earn for disney . Porter it will become the biggest profit spinner four or five years from now, but right now, its going to lose money. It lost almost 1 billion last year just in the start up and each year until it breaks even, it will lose several billion dollars. But that is development cost, and that is actually money well spent. Taylor porter, we are hearing on the Earnings Call from ceo bob iger, who is coming out and saying there is no floor in sight for cable subscriptions. How much of a headwind from cable subscriptions can be offset, frankly, from a rise in streaming . Porter it is not the cable porter it is not the cable subscribers that are the concern. It is the retransmission fees that are worth billions of dollars to disney and other content providers. Just on abc alone, hes going to start to lose literally billions of dollars from retransmission because of the serious cable cord cutting that has been ongoing and is only going to accelerate. Kathleen so you are still very positive on the stock . Is this a stock you own . Is this a stock you would buy . You are positive on online betting. Porter we have been in and out of disney, and i think what has happened is disney has gone from a day traders stock and market influence, rumordriven stock to being a value stock, and that is where the market is going to find a huge appreciation in investing in disney over the long haul. Kathleen as you said, it never hurts to have your brand, your logo, mickey mouse, it is known by so many children around the world. Porter here is a little number you ought to keep in mind disney has a p e today of 17 times. The only other Media Company of any comparable size and content quality is comcast. They are also 17 times. Netflix has a 92 p e. That suggests that since they have announced they are going to spend 15 billion this year and more next year, they are not going to make a profit, and at 92 times, somebody is going to pick them up. Taylor that was mediatech Technology Partner porter bibb with my colleague Kathleen Hayes in new york. Expedia stock falls after the Company Posted its latest Earnings Report citing google algorithm difficulties. We hear from the c. E. O. , mark okerstrom, a little later. This is bloomberg. Taylor with just under a year to go until the 2020 u. S. Election, facebook c. O. O. Sheryl sandberg told Bloomberg News on thursday things wont be the same this time around. Sheryl we think the 2020 election is a massive test for us, and it should be. Elections have changed. We have changed as a company. If you look back to 2016, of course, we were prepared for state actors. What they did was hack in and take information. This new, more insidious stuff, we were totally unprepared. We never thought of it. We missed it. Everyone missed it. Thats different now. Taylor now with elections on the mind this week, state and local voters headed to the polls tuesday. This as we began the oneyear countdown to the 2020 president ial election. How vulnerable are our election systems to hackers . It depends on who you ask. The u. S. Government says russia, china, and iran will seek to meddle in u. S. Elections going forward. Hacking was one of the topics we covered in a special election series. Joining me wednesday was a pair of ethical hackers. Alex from the university of michigan Computer Science professor successfully hacked voter machines in the past to prove vulnerabilities, and harry, the Founding Partner of Cyber Security form nordic innovation labs. The biggest risk is that much of americas election infrastructure is badly out of date. There are many states that still dont have a paper record of every ballot and many states that wont check those paper records where they are present. So there is a risk that sophisticated foreign hackers could break in and actually change the way votes are being counted. Taylor harry, do you agree that is also the biggest risk . It is one of the biggest risks. The other part of this is the u. S. Voting machines generally dont keep forensic evidence. If there is a false claim, knees these machines cannot prove that everything went right. In case that really requires in order to have regain the public trust, that it can prove the results are the correct ones. Taylor harri, how do we get proof . Proof really is all about all the Voting Machines we have today and in the foreseeable future are something which we can hack. They are literally computers, and thats why everything will be hackable. The question is not to audit the machines. The machines have to be as good as possible. Really it is about auditing the results and making sure that the public can trust that the results are correct. It is all about auditing. Taylor professor alex, do you agree that we need to improve our auditing skills to ensure the security of the elections . Thats one of the key components. We have to make sure that state and local governments implement basic Cyber Security hygiene and best practices. We have to make sure there is paper backing every single ballot, and we have to do audits that are robust enough to give us a high probability of detecting any outcome changing fraud. Taylor alex, you mentioned paper voting twice now. Give me your thoughts on paper ballots versus electronic voting. Electronic voting unfortunately was very popular a decade ago. You had computers that just maintained every single record of the vote in a digital database, but all of those records unfortunately can be changed if a cyber attacker is successful in penetrating the Voting Machines used in a jurisdiction. With paper you have a physical record that just cant be changed in a cyber attack. In this day and age, it is just common sense you want to have that kind of physical backup to be safe. Taylor harri, talk to me as we look forward and try to make sure these Voting Machines are secure. What role does technology play . Do we look at block chain to help secure a. I. , better Cyber Security . What role does technology play in securing those votes . First of all u. S. Elections are uniquely complex. U. S. Elections cannot be conducted without using technology. However a lot of technologies are very much unproven and unsuitable. Block chain is a solution looking for a problem. One of the problems is not elections. We have a lot of documents and peer reviews showing and studies showing why block chain is incompatible with elections. We dont have technology for internet voting. It is a hard problem because of the requirement of having secret ballots and auditability at the same time. We dont have any other technology other than paper ballots and then audits to make sure things work how they are supposed to work. Taylor alex, your take on the world of technology . Could you have Something Like block chain . Something that is not hackable . Block chain is really good for certain things. Achieving a Public Record of past events that everyone can agree on. In voting, i would like to say that block chain solves the problem of stolen votes just like bitcoin solves the problem of stolen money. It doesnt. You can still have bitcoin stolen if someone breaks into your computer and steals your password or compromises an exchange. It is the same when it comes to applying block chain to voting. Taylor that might be the quote of the day. Quickly here, a question to you both. Alex, facebook and twitter in the fight on political ads, who is right . I think twitter has it right. The safer thing to do now is make sure that were keeping political fights and potential disinformation at a distance from social media. Especially when the political ads are a potential Revenue Source for the companies involved. Taylor harri, political ads. Does twitter have it right over facebook . I agree with alex. We dont have a human firewall. We lack a training for the voters to have the capability of filter and use a source critic to the advertising we are shown. At this point in time, keeping it out is the best way. Taylor that was Alex Halderman of the university of michigan and harri hursti of nordic innovation labs. As for politics and social media, we covered the big line drawn ahead of the 2020 u. S. President ial election, also part of our electioneering series. In one corner, facebook and c. E. O. Mark zuckerberg spent a lot of time discussing why the social network will not police the accuracy of ads, citing free speech. In the owner corner, twitter and c. E. O. Jack dorsey with a total opposite stance. Last week, he banned all political ads on twitter. With insight into how politician leverage social media, i talked to Jason Rosenbaum. He was Hillary Clintons digital ad director and a member of googles political ads team. I also wanted perspective from tim cameron. C. E. O. Of flexpoint media, a former chief digital officer for the National Republicans senatorial committee. I think facebook is right here, and largely the reason why twitter decided to get out of the political ads is a financial and not a moral one. They only made 3 million last election cycle which is basically a rounding error. Of all the online ad revenue that there is in politics. This is an embarrassingly low number for a company that is arguably the most political social network in the world. Taylor jason, your thoughts . I think both companys approaches are actually problematic. What were seeing here is a certain abdication of their responsibility. This is an issue that we have dealt with other forms of media for decades. What we are lacking is a legislative and regulatory approach to provide some guardrails for social media paid advertising. Local tv and radio stations for years have been prohibited from running factually incorrect advertising. And political advertising should be no different. So what we need is for congress and regulatory agencies to implement some kind of guardrails for this technology. The obvious first step would be to pass the honest ads act, which would provide true disclosure for political advertising so we know who is spending what and where. Taylor tim, i want to take a step back and take a look at facebook in particular who has taken a stance on this. Part of their ads are really hyper targeted. When you talk about this, we want to distinguish how do you make sure that within those hyper targeted ads that they are accurate . How do you go about doing that . Should we not do hyper targeted ads . Should we . Tim i dont think hyper targeted ads are any more risky than broadly targeted ads. You can disseminate wrong information to a small group or large group. This is the cost we pay for living in a free society. To quote former Supreme Court Justice Anthony kennedy, the remedy for false statements is the truth. That is the cost of living in a free society. To protect the First Amendment and to be able to get out there without prior restraint, that is something that is important. Because if we start prohibiting ads, and you look at somebody like Elizabeth Warren who is completely in favor of facebook taking on this role despite saying at the same time that they are way too powerful, you risk potentially republicans from being blocked from saying that her plan on medicare for all will raise taxes on the middle class. You know, maybe not this election, but down the road, that could lead to tyranny. Taylor jason, in your earlier comments, you brought up some local Media Coverage or radio where they are not allowed to run false ads. Im wondering if part of the problem here is the ads on facebook or other sites are not clearly marked as ads. Do we need to do a better job of presenting these ads for what they are . Paid for by, and make it clear these are ads . Would this solve part of the problem . Jason we do have that. Federal election law requires that paid political advertising be disclosed, that there is a disclosure on those advertisements, and we should have that. We should also have checks in place to ensure that political candidates, political organizations cant run factually incorrect advertising, knowingly do so. These are checks we have had in place for over 50 years for broadcast television and radio. We have a new technology with social media that is still in its infancy and has proven to be remarkably powerful in its ability to change peoples opinions. We have to ask ourselves, are we going to provide some guardrails here . If we are, and i believe we should, are they meaningful . I dont believe either banning political advertising or throwing our hands in the air and saying candidates can run whatever they want is meaningful reform. Taylor tim, in response to some of those comments that jason was making, i also wanted to bring up a quote from Trumps Campaign manager talking about the 2016 and the election and the role that facebook played in that, where he said i think facebook is how we won in a lot of ways. I think President Trump won. Facebook is a. 01 that delivered that message. If facebook didnt exist, it would have been a lot tougher. Your take . Tim i think that is absolutely true. It is a big reason why they won and a big reason why a lot of campaigns have won. It is not the singular reason, but it contributed. Everybody is looking at this from the perspective of the president ial campaign and the implications go much further down. In fact, you know, a lot of what these social networks do is enable city councilmen and statehouse reps and smaller candidates to gain traction. The move twitter made by banning political advertisements is it is going to have a distinct impact on smaller, under the radar candidates like, say, andrew yang who suffered underneath a media blackout for months, and to prevent them from getting the message out. We have to think through what the longterm implications are, because this is bigger than the 2020 election. We are talking about the First Amendment which is something that is fundamental to our society, and hopefully will be here for centuries to come. Taylor jason, finally, as we take a look out at the landscape and the democratic committee, where are they in catching up with online spending . We remember barack obama was very tech savvy. Came out and was able to get that niche, younger audience in part because of technology and social media. Where is the Democratic National party on this today . Have they done enough . Its been written a lot that President Trump is spending significant amounts of money online. Hes the incumbent and he has a large warchest right now. The Democratic Candidates are spending significantly on early states and across the country. And, i think i believe still are far more sophisticated than many of the republican candidates in the field. Taylor that was Jason Rosenbaum of Seward Square strategies and tim cameron of flexpoint media. Coming up, expedia shares fall after the Company Misses on earnings. What is ahead for the Online Travel company . We hear from the c. E. O. Next. This is bloomberg. Taylor Online Travel Companies Got our attention this week as trip advisor and expedia reported earnings after the bell wednesday. Both companies blame poor earnings on decreases in Google Search results. Expedias Vacation Rental business saw a decline in revenue growth. Its president and c. E. O. Mark okerstrom joined bloomberg thursday to discuss strategy and outlook. Mark we did have a difficult quarter. That said, theres a lot of great things happening around expedia group. We had a lot of highlights. Volume from room nights are up 11 . We continue to see great strength on our Expedia Partner Solutions business. We continue to make great efforts on our customer centricity initiatives. We did see direct channels up more than the overall business. And weve got a long way ahead runway ahead of us. Guy lets talk about whats happening with the shortterm rental business. There seems to be a concern that you are struggling to make your message heard on google. How do you reduce your reliance on Google Search . Mark i think overall, whether its our alternative accommodations in business or vrbo or other core brands, a lot of it is the strategies we have in place, which is making sure we have great products for customers, that we build a Loyal Customer relationships, weve got incredible loyalty programs. Hotels. Com, for example, just hit their 50 millionth loyalty member. Expedia has a good rewards program. Its about building incredible rewards and services for customers and thats what we are aimed at doing. Vrbo itself, the alternative accommodations brand, has relaunched its new brand. They are looking at launching that in other regions around the world. Ultimately, we have seen good strength there. The vrbo brand itself has been up nicely doubledigits. We will continue to move along with our multichannel strategy that really isnt a strategy that is solely dependent on google. Vonnie how much more are you going to spend on marketing with vrbo . It is taking time to have this rebranding accepted and known by the public, particularly now with this new challenge of google putting hotel finder above the likes of vrbo in search. That makes it much more difficult for you. I think the street and investors want to know when that will happen, how much it will cost for that to happen . Mark we will do it in a balanced way, which is the way that we have always done it. We have that and digital television. We are seeing good results. As we roll out internationally, we will continue to do it in a balanced way. But our alternative accommodation strategy isnt just about vrbo. We recently brought our partner facing teams closer together. We are now just over 650 alternative accommodations offerings from vrbo available on our core brands. International expansion for us will be a real combined effort. Taylor that was expedia ceo mark okerstrom. That does it for this edition of best of bloomberg technology. Well bring you all of the latest in tech throughout the week. Tune in each day, 5 00 p. M. In new york. 2 00 p. M. In san francisco. Bloomberg technology is Live Streaming on twitter. Check us out technology and be sure to follow our Global News Network tiktok on twitter. This is bloomberg. Tom he is known as the ambassador of silicon valley, speaking to congress and the white house on issues that matter to the tech community, issues such as privacy, regulation, or the 10 million pentagon contract that microsoft just won. Having spent 26 years of his career working at microsoft alongside bill gates, steve ballmer, and now satya nadella, brad smith had a front row seat to some of the companys biggest milestones. He is now focused on spreading the message beyond microsofts campus with a new book, tools