Big offering at ces. Meg whitman and Jeffrey Katzenberg in las vegas. First our top story, the threat of war brings profits for the defense industry, and a risk of Cyber Attacks from iran could shine a spotlight on assets. Take a look at how these firms performed, their shares gained about 8 the last few days. It is indicative that cyber volleys between the u. S. And iran are not going away anytime soon. To discuss what could be next, marcus is a director at an ai security firm. In studio, our reporter. Ingot the attacks from iran physical form. Does that mean we are clear from the cyber perspective . Definitely not. There is a significant distinction between irans conventional battlefield capabilities and where they are on the cyber front. They are never going to go toe to toe with the United States in this realm in a conventional battle. In the cyber realm, they have a greater chance of pushing back more dramatically and having a greater impact in the United States, so even though they have not gone that route in terms of immediate reprisal, it is not out of the question that we will see something else. Taylor marcus, your take on that . I think you make great points. They are moving into the cyberspace. This is the time for them to do it even more than they have. Certainly, i was not expecting to see the immediate retribution, but the cyberattacks and vulnerabilities are significant and we think about those. It expands to not only the government, but the Threat Landscape associated with the private industry and commercial companies. Taylor i wonder why a physical attack first and then a cyber attack . Why is Cyber Attacks seen as a secondary choice . I feel to get adequate revenge, it needed to be something in the physical space they could point to on par with what occurred. However cyber allows them to do it behind the scenes and include something they could attribute. Taylor in the introduction, we were talking about some of the companies that could benefit from this. In your reporting, is it too early to tell . It is hard to say because you have crowd strike and fire eye as the cyber firms listed, but there are dozens of large and small companies. Microsoft offers Cyber Security solutions and Onsite Services when there is a hack. Cisco does as well. There are local providers providing state governments and counting with cybersecurity protection, so i think you can state that it will reach some of the benefits come about what share is hard to tell right now. Taylor we have been talking about this for a few days. Does that mean we are anymore prepared . I dont think the answer is yes. I think you are more on guard. As you talk about the Cyber Security and what they are looking at, i think one area we are seeing a growth is the application of Artificial Intelligence to move faster into that security space more quickly. We have a scarcity on cybersecurity skill sets. There are a number of individuals trying to find them right formula. And getting a more robust Security Team in place. Taylor some of your smart analysis has pointed to an increase in National Infrastructure and cyberattacks. Walk me through both of those. Theres a lot of vulnerability in the u. S. If they were going to strike in the u. S. , it might be against critical infrastructure. I think today we move past that level of escalation, but it remains a vulnerability and something we have to be very mindful of. I know the u. S. Government is focused on it. You have these systems now being more linked into the i. T. And that makes that more ability that vulnerability increased. You are talking about moving away from going after data, grabbing data and causing machines to destroy themselves through a cyberattack. That is significant if we move further into that space, and it becomes mainstream is a viable escalation point. Taylor how good are the iranian coders and how good are we at defending ourselves spirit . How do we know they are getting ahead of us . It is hard to say on a daytoday basis how they are progressing, since stuxnet hit 10 years ago we have seen capabilities mature aggressively. In 2012, they showed an attack on summary aramco and no one saudi aramco, and no one thought they would use that attack again and four years later they were able to attack a broader swath of saudi assets. We have seen smaller attacks that are more incrementally sophisticated in their technology and the way they are using it. That indicates their program is getting stronger. The trouble is understanding what they are capable of and so i guess we will really know what they are capable of when we see what theyre capable of. Scope, dor size and you have an estimate for the economic damage this could cause on any one corporation . Is costingage breach a company 4 million. Looking across the vulnerabilities, i dont think they will stick to traditional errors. They are looking at where is the vulnerability and the greatest impact. Their sophistication allows them to scale to some of the smaller areas. Maybe not the big ones that immediately come to mind. I think theyre looking at all options across Different Industries in the United States. To make access they can act on today or tomorrow. Taylor thank you both for joining. Coming up, our conversation with caspertman and jeffrey Jeffrey Katzenberg of quibi. And if you like bloomberg news, check us out on the radio. You can listen on the bloomberg , bloomberg. Com and in the u. S. On sirius xm. This is bloomberg. Taylor with all eyes on the ces tradeshow in las vegas, it is worth considering something counterintuitive. Venture capitalists like Consumer Technology a lot more. Last year, enterprise Tech Startups raise more cash than Consumer Tech companies for the first time in at least five years. We are joined by Sarah Mcbride who wrote about this. What is starting to change . A lot of things. For a start the Tech Companies , have a much shorter path to ipo and profitability. One tech executive who says he thinks he can get to 100 million in revenue as an enterprise company. Enterprise used to be super boring, to staff accounting software. It has helped to drive that and a littleumers lost luster these days. Taylor what does that say about Consumer Tech . When you were an ipo, maybe a big company could come in by ul. Buy you out. What does that mean for the future given that there is less amount for little startups . The smartest young entrepreneurs tell me they are just not interested in Consumer Tech anymore and a big company like facebook, google or apple will come by you before you have you before you have a chance to get going and if you say no, they will crush you and try to develop whatever you are doing inhouse and then you are just it is a nowin situation. Enterprise companies cant really do that. If they try to replicate what you were doing inhouse, it will probably not work out very well. Taylor do you still see ipos being favored versus being bought out . That is right. The outcome will be smaller. If you make it to the ipo stage as a consumer company, it is probably a blockbuster giant ipo. So that is not necessarily the same for some of these enterprise Tech Companies. It will be a smaller ipo, but a much higher chance of getting there. Taylor i think a lot of concern in this business, there is so much cash chasing too few good investments. Right, for enterprise, the creativity is astonishing. People keep coming up with very clever ideas with how to make businesses better, so while a sound the Companies Similar to each other, theres actually incredible innovation on the market for the product, so as long as that keeps happening, i dont think it is a question of tou much cash chasing too few companies. Taylor we will have to see if that trend continues and 2020. Sarah mcbride, thank you for joining. Earlier, we caught up with quick quibie Ceo Meg Whitman and Jeffrey Katzenberg, and talk about how mobile content can change the future of streaming. We talked about a new Technology Platform which is part of our differentiation of streaming services that will allow mobile viewing to be extraordinary and enable creators to tell a story i hold tell stories in a new way with a mobile phone. We think people will be on quibie during the day, on the go where they have a chance to watch very fantastic hollywood Quality Content in short bites a technologyoduced today that is fullscreen video that allows you to see content in ways never before. You just closed a second round of funding, 400 million that will carry you through the spring launch in april and beyond. I want to get more of the details here. 175 new original shows, 86 episodes of quick bite content, this is a crowded field. Who exactly are you targeting with this content, and how do you convince them to pay another 4. 99 on top of netflix, hbo go and disney plus . Our content is quite unique, very differentiated from anything anybody is making today. We are relying on this Incredible Technology that is quite revolutionary in terms of the quality of what we can deliver, and yes, there is a tremendous volume of content. People want quality but they want quantity. We will publish three hours of original content every single day. That is 35 more than a broadcast network. Were not competing for the television set. All the things going on today are all focused on what people are doing in front of the tv. Less than 10 of viewing on netflix, hbo, disney, any of aem are actually on telephone. We are only on a telephone, so we are highly differentiated are we competing for the same dollars . Yes, we are, but we are offering something that is new and exciting and unlike anything they have seen before and our bet is it will be highly appealing and unique. Can you talk about the cost to get up to speed were just get the content out there. We mentioned the fundraising you have had so far. We would be the First Streaming Service to launch without a library. You cant just take an hourlong show and chop it up. Everything is new because the platform is new and viewing experience is completely different. We think with 175 shows, 86 episodes, it is a unique content strategy and theres a lot of content. As you know, we had the the fund raise for this one and thisll turn right through the middle of 2021, so we are wellfunded and well see how we start off. We feel great about the amount of content. Ceo megthat was quibi whitman and Jeffrey Katzenberg. Coming up, a bump for bitcoin. It reaches the highest price since november. Tensions between the u. S. And iran might be the reason. We discuss, next. This is bloomberg. Taylor bitcoin has climbed to the highest level since november after breaching the 8,000 price threshold. Concerns about an escalation of the conflict between the u. S. And around are seen attributed to bitcoin which is not run by a government. First, i want to take a look at a chart here. It is a technical chart, but the theme really is we have been in this trading range and we are not overbought at these levels. We could be breaking out of this trading range. Do you see this as technically driven . Yes, great question. Again, highfrequency tradings really drive bitcoin and anytime you have an unforeseen circumstance like what happened , that adds new buyers, and that bumps it up. It really drives it to be up 20 . Taylor im shocked it is moving higher with gold and seen as a safe haven. Every couple years we have these events. We see that happen a lot now. I dont know if people went and sold their ge stock and bought bitcoin. A little bit of people started buying bitcoin, and that makes it go higher faster. Taylor what are some of the fundamentals of bitcoin going higher in 2020 . A year ago i was on the show at the same time, and i predicted it would hit close to 15,000 and it did. This year, i think it passes the alltime high and goes past 20,000. Taylor how . What is driving that . The supply of bitcoin will go in half. Bitcoin goes up high when unforeseen things happen. This year, things like china, india, russia could authorize bitcoin. The American Government could do something. Fundamentally, we have seen the large Tech Companies getting into the space, i think youll see that, but it will be the on the unforeseen thing that itpens every year and makes go up fast and far. Taylor libra, seen as a competitor but does it get into give legitimacy to the space . Option,r is a payment which is what bitcoin has been trying to do. It libra can make a go fast because it has Brand Awareness with 2 billion users and a facebook platform. If libra gets approved by the government, you will see people cryptocurrency, and when they are in it, they can go to bitcoin, and it adds new people to the environment. Taylor does the regulatory scrutiny that libra and facebook brought help or hurt . It has helped because governments are saying to libra, why cant you be like bitcoin . It is getting a lot of attention, and governments have realized we need to regulate this in some way. Launching their own digital coin comparative to libra. Taylor do you see china and russia as legitimate competitors to taking on the u. S. , taking on a cryptocurrency, taking on bitcoin . Do you see that as a real issue in 2020 . Im not sure russia has my. I am not sure about russia that much. , and irican government offer myself to me trump in the white house to explain what the value of cryptocurrency is and what the role of the government should be. The last thing you want is a Foreign Government to take control of this market. Taylor one of the worries about , is the volatility. Rendy lu expect to see reduced volatility in the wild swings we get . Platforms get involved uying. Stitutional b you are saying 20,000 on bitcoin, when . Sometime this year we will pass 20,000, but sometime this year. We will have you on then. Thank you, chief commercial officer at bitpay. Major security flaws in the video app tiktok have been revealed. We will talk about them next. This is bloomberg. Taylor this is bloomberg technology. We join bloomberg daybreak australia. I am taylor riggs in san francisco. Lets take a look at the top global tech stories of the day. Lets start with the u. K. , a warning from a regulator has ebay and facebook cracking down on fake reviewers. Facebook took action against 188 groups. The action came after the competition and Market Authority demanded changes in online reviews. Companyoreignexchange has contained the Ransomware Attack that crippled it new years eve. The cyberattack forced the firm to suspend services. The hackers claiming responsibility demanded 4. 6 million. Leadershinas flowering people from delivery to home cleaning is seeking a u. S. Ipo of nearly 2 billion. It is chinas equivalent to craigslist and is backed by tencent. Those the top global tech stories. Taylor the u. S. Government says tiktok is a National Security risk, focusing on how the popular viral video app could allow the Chinese Government to access peoples data. Securityts are major flaws that would give hackers plenty of ways to get users information. Tiktok says it has patched the fall. s headjoined by tiktok of engineering, Jeff Schwartz. Your report was alarming, page after page getting more nervous. What are some of the major security flaws you found . Two allowed a bad actor, a malicious user to modify urls for login that would result in code being run on the victims devices. Based on that code being run, account takeover activity is capable to be leveraged against onceictims device, and that account is taken over, there is modification of videos, deleting videos, marking videos that are private as public, and a subsequent vulnerability that allows for api access into the personal data of the account owner, that was being maintained by tiktok. What are the weaknesses in infrastructure that allow this to happen . Aboutou informed tiktok this, they deployed a patch for it. We notified them through responsible disclosure, and they were cooperative with these issues. But the research is a much larger concern, and that is the fact many applications are deployed on consumer and enterprise devices that are susceptible. These are the discovered vulnerabilities that we know of, and when we consider what we do not know, and the applications that have not gone through the level of Extensive Research we have done like last year with whatsapp and this year with tiktok, we consider the surface exposure area on the number of devices, both consumers and enterprises have not sufficiently taken qualitative preventative controls into a account in securing their devices and information. Taylor you mentioned other Tech Companies you have looked at. Within the vulnerabilities you unusual,tiktok is this or is it to be expected in every highgrowth tech app . It could be a combination of things. It is difficult to say if this is it high product of human error or development cycles, or there was malicious intent. , it would behaps more appropriate to comment on Something Like that, but i think it is indicative of larger issues that applications have exposures, the operating systems have a live on have exposures, and the hardware has exposures itself. We consider this in aggregate, there are things we do not know, and the best course of action is to have preventative trolls that can mitigate these in realtime. As an individual or an enterprise, you will not be able to monitor the