Transcripts For BLOOMBERG Bloomberg Technology 20240712 : vi

BLOOMBERG Bloomberg Technology July 12, 2024

Tiktok. Thatow we are hearing thiller. And of 49 fortnite, apple says it is terminated ebix developer account. Developer account. A lot going on. The fed, the prime and a strut japan stepping down. Earnings. The ending of the Republican National convention. Walk us through what has impacted the day. So much and all of it ended in record high for the nasdaq and s p 500, investors encouraged by the fed latest policy shift, the idea that perhaps it is reinflationary in nature, stocks respond in kind. Apple, this is interesting, over the last two days apple is underperforming, down the last two days 1 , closing a little as were mentioning now, terminating the epic caliber account in the midst of the developer account went epic refuses to pay the 30 fee. That apple is standing up for that along with alphabet shows they are forcing developers to comply with roles. It will be interest rules. Im not sure how this would impact the bottom line for apple but it must not be all that much. You mentioned shinzo abe of japan resigning. The yen was up sharply intern and the dollar down one of its worst days and months. You have the australian and new Zealand Dollar up 1 , a lot of volatility. The dollar down cost of liver commodity complex to pop. Caused the bloomberg commodity to pop. Net debt, this is risk on. This is rest on. Risk on. If you take a look at the hightech risk of companies and orange relative to look Tech Companies and orange has started to gain. Selecteds plan if you to raise corporate taxes to 20 , trump passed a tax cut in 2017 and talked about the possibility more tax cuts, this suggests some investors may believe President Trump has a chance of pulling what he pulled in 2016, considering highTech Companies are doing better implies that maybe high taxes are not going to be coming anytime soon . Or higher taxes i should say. Interesting. We have also been following a hot taste for tiktok. Microsoft, oracle, ending the day in the green. We are standing by 40s on this in the next 48 hours. Standing by for news on this. Other companies, centricus and triller, might also be some missing a bit. Talk to us about the backandforth . It is stunning. These tiktok assets, the potential, as you know in the u. S. Only 80 million users and in the whole world tiktok has 800 million. Relative to facebook at 2. 6 billion, so that you have these Companies Going after it was so much theyll points to the sort of potential there is longerterm. Walmarter this week, and microsoft, walmart perhaps wanting in on it emaar, because becausedia more, tiktoks secondbiggest market is india. Oracle and microsoft up on the week and oracle may have the advantage of larry ellis supporting President Trump. The latest consortium that may put in a bid, centricus and tril ler, with the Asset Management giant, possibly a 20 million bid, it seems this story will keep going. It will be interesting to see the result and how soon we get news. Abigail, thank you for breaking that all down for us and have a wonderful weekend and happy friday. Continuing now on the latest tiktok developments. Investors trying to get their heads around a potential partnership with microsoft and walmart. Oracle still in the game. I want to bring in kurt wagner, who been following the story. We have the new development from centricus and triller. We also heard from a source close to the deal that it could go either way this point. Microsoft, walmart or oracle, they have an equal shot, is that what you are hearing . Who you areepends talking to, emily. There are so many people involved now in varying degrees. We are kind of hearing everything. It seems clear walmart, microsoft and oracle are clearly that two front runners. Bidmentioned that centricus we were writing about today. Tot feels like a hail mary me at the station the discussions. It really depends who you talk to. A lot of people thought after while mark came out publicly yesterday to join microsoft that put them directly in the driver seat. There are others to think oracle is there but your guess is as good as mine subject to this administration, the Trump White House that tends to change its mind quickly. Walmart came out yesterday. Emily what about the centricus triller development. Is this solid . It is a real bed. Bid. The challenge will be, does this check the boxes the white house has been demanding . They want a u. S. Company to own the u. S. Business of tiktok. Centricus is based in london, a global firm. Company,is not a large like a microsoft that could come in and handle the data issues that are of concern to the white house. That is something microsoft has an saying that it could protect the data of u. S. Users, that it has those technology set up and running. Those are the types of benefits of going with a bigger player. The bid israel the bid is real. To me, it feels like a long shot that centricus would be a winner here. Emily so, how soon do you think this could be wrapped up . Yesterday was within 48 hours, potentially. Now we have 24 hours in that window. How soon could this happen . It could happen very soon. Ready preparing to get over the weekend in case something were to happen. We were told yesterday it could happen within the week. And the fact that centricus the bid came out today, within the last 30 minutes, is a sign that this is still evolving, right . So it is possible this could take longer. Or are onicipating, call that this could happen quickly. Emily what happens after a deal gets announced . This is where it becomes complicated. My guess is they will announce some kind of agreement, but still have a lot of the nittygritty details they have to figure out. Essentially, what they are doing is creating an entire new entity, right . There is no u. S. Tiktok now. There is the global tiktok. They would be carving out that u. S. Business. So it would be interesting from a corporate standpoint, which employees are going to be coming over with the new entity . Bytedance stay with or other versions of tiktok . What will happen with the Management Team . What is going to happen with the board . These are things that happen when you create a new entity. Simply announcing who wins this deal is step one. All those very specific and important details are going to take a lot longer to figure out. Bloombergsght, kurt wagner on this story with us. We will check back with you on monday for the latest. Now, microsoft cofounder bill gates. When i sat down with gates earlier this month, microsoft had freshly expressed interest in tiktok. Gates said the companys assets would be in good hands. Microsoft is very careful about its data promises. We will try to have strong relationships globally. That aredo things hostile or viewed as hostile. My conversation with bill bloombergan extended studio 1. 0 airs tonight 7 30 p. M. Eastern, do not miss it right here on bloomberg television. Coming up next, a lesserknown beneficiary of the pandemic come of the Cloud Computing company, opta. Its stock doubled since march. We will speak to the ceo, todd mckinnon, next, okta. This is bloomberg. The covid19 pandemic, for all its human and economic tragedy, has spurred a huge opportunity for tech innovation. The Cloud Computing company okta is one Success Story fueled by the work at home boom. The Company Reported strong secondquarter results and the stock has doubled from the start of the pandemic. The ceo who became a billionaire on paper in the last five months since our headwinds ahead. He joins us for an exclusive interview. Todd, thank you for joining us. Taking a step back what are the main drivers for growth you have seen over the last five months . The last five months, it has been an amazing, crazy right for everyone. The main part of our business has been what is driving us for many years. More companies. Are using more cloud applications they are using technology to transform their own customer experience, make better websites and mobile apps. They want to do it securely. We are able to help them do all three of those big important things which is why we are in the fortunate position we are in. Emily lets talk about the headwinds. You did say on the call there were some headwinds ahead. What, specifically, are those headwinds in the second half of the year . Well 11 of our customers are in what we call directly impacted industries. Things like entertainment, resorts, cruise lines. Those companies are having a hard time with covid19. That is a headwind. That has been offset with everyone else rushing to support remote work. For example, we were able to in 36t fedex in a go live hours, where they moved 85,000 employees onto okta, so they could effectively execute their company and support Remote Workers lockean to keep the business running. Remote workers logged in keep the business running. Like everyone else if we look out the next 612 months there are macroeconomic questions. What happens to the economy, as things evolve . We are being prudent to make sure we make the right decisions in that context. Emily i talked to your former boss, marc benioff of salesforce. He says it is the end of software. Everything is moved to the cloud. What you agree . Would you agree . Companies want fast time to value and flex ability. Flexibility. If you thing about covid19, theres no better situation to them a trade the power of the cloud. No can work anytime better situation to demonstrate the power of the cloud. You can work anytime everywhere. Oktas marketly, cap hash sword, 27 billy has soared, 27b. What are the white spaces in your portfolio you may be looking to fill and would you be open to significants ideal . From a we look at m a customer centric viewpoint, we have always been that way. At the Company Involved we listen to customers. What we have innovated. A big innovation we have done recently is we turn to the okta identity cloud into an extensible platform. Customers want to be able to use different components of the identity cloud to support different business processes, employees logging into critical work applications, our customers logging into our customerswebsites. That is our approach to m a. We are looking for things that benefit customers. One of the Mistakes Companies make about m a is a look at it from a financial spreadsheet perspective. They do not look at it in what is good for customers. What will be better for customers if it is delivered by okta combined with Something Else . That is a powerful lens and that informs our perspective. Plan toou have said you let employees work from home permanently, if they want. We are hearing from some ceos that they are not open to this. They want their employees to come back to work. What trends are you seeing in worker productivity . Our workers as productive at home . Are workers as productive at home . Emily, one interesting thing we have seen as we monitor our service in nature it is rely blend scalable, we can see the aggregate usage patterns of users. We have seen incredible things. We saw 27 increase, post cobit over precovet of people logging in at 4 post covid19 over precovet 19, of people logging in at 4 00 a. M. And we have seen people at the end of the day, at the other end, 30 of people logging in at 1 00 a. M. So people are working very hard. And they are doing this, they are also taking care of family response melodies. We have seen a decrease of family responsibilities. We have seen a decrease of logins and the 1 00 p. M. 5 00 p. M. Area. You talk about people rallying and trying to make the best of a tough situation, we are seeing that flexibility the cloud can bring to give people the adaptability. That is that interesting phenomenon we are seeing. Now, while preparing for a spate of tech ipos later this year, airbnb, pelletier, palantir, asana. Im curious what he think about companies waiting to get out of the gate . Two long . Too long . Do you think we will see the pendulum swing back were companies go public earlier . We have in public three and a half years and i remember when we were making the decision to go public. I was the word or rumor or concert people had was that once you are public or concern people had is once you are public investments are constrained or it is hard to innovate. And i have found that to be not true at all. Our experience as a public company, we are in strong alignment with our shareholders. We have been clear with them and consistent we are going to invest for the long term. That we have a stable, predict will, reliable business. I think it has been and a it should be public. You mentioned m a, and we have been able to raise a significant amount of capital to give us a sick nick at war chest for m a. A significant warchest. Ceos for companies that i stable, predict will, rival businesses, is there are a lot of stable, predict will, reliable businesses is that there are a lot of advantages to being public. Emily todd, ceo of okta, thank you. Scooping, nerd wallet up a u. K. Startup, later this hour. Four of Bloomberg Technology after the break. This is bloomberg. The Consumer Finance resource destination nerd wallet is making a leap into International Waters buying know your money, a u. K. Comparison website. Tim nerd ceo wallet ceo is with us on the phone. How does this expand what nerd wallet can offer . Our vision is a world where consumers make Financial Decisions with confidence. We are growing and profitable and thought disobeyed opportunity to expand into the worlds second biggest market. In u. K. Is wellversed financial comparisonshopping already. We thought there was a big opportunity to bring content and helpful tools and calculators to the market. About what to us insides you are getting from consumer behavior, based on information you have about customersfinancial moves now . Are in a time defined by the pandemic, as well as government stimulus. We are seeing interest in things like life insurance, refinancing as Interest Rates come down, especially on the student loan and mortgage side. We are also seeing a big headwind in terms of interest, and travel credit cards, and things like that. The other trend we are seeing is a huge amount of interest in getting into the stock market. I think the stimulus checks and rise and fall of the stock market is having an impact on retail demand. We see record numbers of people signing up for free trading accounts available now as well. Emily what are your plans for future growth, especially given that if there is only one thing we know about the future is that there is more uncertainty ahead . Yes, theres more uncertainty ahead. But we are seeing a pull forward in this offline to online trend, and consumers finding Financial Services online. We think there is many more countries ahead for us, and we are thinking more about getting deeper and the verticals we are already in. We think there is a lot of opportunities to make money easier for a lot of people. Emily so, what do you see ahead. Obviously there is a lot we do not know. What are you planning for as you map out your strategy and scenarios for the companys future . Always felt was important to maintain financial discipline, in terms of how we invest. We have only done one round of financing historically. We tried to run at a healthy margin. I think that is important. 2020, we canlike be more opportunistic about finding great investments, and finding teams with aligned mission such as know your money. So we are active in thinking about what is next. We are also investing heavily in our memory some experience. We think theres a big opportunity to democratize Financial Advice to everyone. That starts with understanding more about our consumer, so we cannot them when they should do smart thing so that we can nudge them when they should do smart things with their money. Emily what about your global ambitions given this new acquisition . What does this look like . It is going to be a long road ahead. We have a longterm orientation. We are thinking 102030 years ahead. We are going to learn a lot of lessons entering the u. K. , our First International market. There are many other markets, each different. Theres a big focus on Car Insurance comparison there, as well as energy shopping, which are less prevalent in the united states. There are differences in other markets as well we will keep an eye on those. Ceo all right, tim chen, of nerdwallet, thank you. Apple taking a tough stance in the dispute with epic games. Terminating epics developer account, the developer of fortnite. This is bloomberg. Emily welcome back. Back to our top story on the Battle Royale between apple and epic games. The iphone maker saying it has terminated epics developer account in the midst of a lawsuit. I want to bring in mark gurman who covers apple for us. Tell us about this latest twist. Isk yeah, the latest twist apple following up on the threat it made two weeks ago to remove the developer account for epic games. It means in addition to fortnite no longer being on the app store, epic wont be able to do updates or new app submissions. It means a few other games and applications on the app stores will also no longer be available as of today. Lastly, it means users who already have fortnite will not be able to make in App Purchases through apples system. We knew this was coming but now it is interesting to see apple went ahead and did it amidst the lawsuit. Emily so, what does this mean for epic . Is this a blow . Mark this is definitely a blow for epic. I think its another showing from apple that they are not just being all talk. They are actually following through on this. What apple is saying today is that any other developer who would have violated the guidelines would have been given the same 14 days to comply with the app store and they would remove their account. Not removing epic would have been an exception. Theres a one win for epic. Apple did not remove a second developer account that epic uses to develop unreal engine, which is gaming frameworks that epic uses for its titles with other developers use not only on the iphone but others as well. The judge ruled earlier in the week that apple would not be able to remove that account. Apple complied with the judges ruling and did not remove

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