Launching new versions of its chatbot that is twice as likely to answer the question correctly. We discussed with the president. Caroline amazon employees catch a glimpse into work with the future with humanoid robots. We go behind the scenes with a look at the bot named digit. Lets get into these markets. The nasdaq down by. 1 . Notably having some caution after we die just a lot of the market runup we have seen broadly in ai stocks. Golden dragon index. I want to shine a light on chinese stocks. Still not getting a grand focus on stimulation coming from china. And where is the press conference from the premier . Some anxiety around chinese stocks, reflected in u. S. Trading. 10year yield up three basis points. Looking ahead to job data that we get later in the week, fed speak. Bonds trading lower. What continues to outperform, thin liquidity on the weekend, driving up today, 5. 7 higher on bitcoin. Getting closer to that record level at 69,000. Keep an eye on that particular risk asset. Ed another name pushing higher is nvidia. Market cap, 2. 13 trillion, the milestone it reached on friday into monday, now the worlds third most valuable company by dollar cap, passing saudi aramco. One other mega cap, number two company, apple moving to the downside. Down 2. 7 . At one point, the stock was done more than 3 which was a 100 billion market cap drop. This is not only the first eu antitrust fine directed toward apple but it is significantly bigger than we thought it would be. 1. 8 billion euros, 2 billion. It is all about market abuse in a music streaming context that apple plans to appeal. I think we brace ourselves for a lot of litigation to come. Caroline we know who delivers those fines, focusing on big tech, the eu competition chief. Lets see what she had to say about it. The commission has find apple 1. 80 4 billion euros for abusing its dominant position on the market for the distribution of music streaming apps. Caroline lets go to brussels where that news comes from. Oliver crook is with us. When you are looking at apple with hundreds of billions in cash, the money doesnt always matter. It is the president and what changes in behavior that the eu is demanding. This is a much larger fine than we anticipated. The reporting was 500 Million Euros anticipated, so there is a bit of a shock there. It is about abuse over what apps and competition apple was allowing from other people. The eu has said that how apple acted was illegal, they been doing it for 10 years, and they need to remedy this. There is doubt that this will be enough money to change behavior, but it is coming in about what everyone anticipated. Apple saying they will appeal it. But Something Like 20 of consumers who may have adopted spotify did not get the chance to even see it, so this is going into the crosshairs in a week where there is major legislation on tech regulation coming out of brussels. Ed we showed apples response to the fine and announcement, giving a pointed quote, saying, in the context of competition, they feel this decision protects one european company. They didnt name them but they are talking about spotify. When is the debate here . You have the eu saying one thing, apple saying the opposite. Oliver apple is saying how can we have such an effect on this when spotify has had a norm growth, has not suffered . Spotify does not see things quite the same way. She mentioned this in the press conference she held earlier today, saying you dont know how much growth was intentionally available to europe. You will hear this from apple, the united states, but here in europe, they want to stick their claims on being the regulators. The Digital Markets act, we are talking about one company in the app store dealing with music streaming. This thursday, you have Major Companies that will be touched by regulation trying to deal with all of this kind of competition. That is not just in the app store, it is all encompassing. They really want to send a strong message that you need to comply, that they are serious, that they are here for business. When you look at this 1. 80 4 million, it is quite interesting. 1. 8 of that was a lump sum put on top specifically because it was apple, because it correlates to their annual revenue, 0. 5 . This is the eu saying they are here for business. Ed oliver crook in brussels. Tune in tomorrow when oliver will sit down for an interview with e. U. Vice president. Coming up, we will talk about reddits ipo, Artificial Intelligence. A broad conversation coming up with the Citizens Financial Group ceo. I see some breaking news in the airlines. Caroline keep an eye on boeing. American airlines is agreeing to buy 260 new shorthaul aircraft, including 85 787 max 10s, a key vote of confidence. Up to. 3 on american airlines. Boeing still off by. 3 . We will see 85 neo planes from airbus. American airlines spreading the love but it is giving an 85 endorsement to the max 10 aircraft. Caroline cash flow management, not always the sexiest, but ai has a role in terms of it. Jp morgans tool which runs on Artificial Intelligence helps customers. Since launching a year ago, the wholesale payments unit has 2500 clients using the product. This follows other lenders that happens living up there use of Artificial Intelligence with the aim of lifting productivity, reducing cost. Ed one of those banks is citizens. Lets talk about that with chairman and ceo bruce van saun, who is in town for a conference in San Francisco. Jp morgan wanted to add a billion dollars of value, upgraded it to 1. 5 billion this year because of the work they are doing in ai. Do you have a similar goal that you are working on . Bruce may 1 lesson zero on some of these numbers, us versus them, size wise, but we have a similar product called cash flow essentials which helps Small Businesses forecast their cash flows, rolling out this year. Great expectations for it. Ed you come to town three years after getting your tech vertical set up through jmp. Is there one clear ambition you have this week, the conversation that you will have . I know these events, some dealmaking going on as well. Bruce well over 100 companies presenting, both private and public, several hundred attendees. It is staged at a very good time when the markets are starting to look more promising starting to see some green shoots around ipos, which is terrific just looking at the u. S. Economy and how tech is powering all industries, how ai has huge potential going forward, its a really good time to have People Exchange their thoughts on that. Ed lets jump in on the ipo situation. Reddit is important for you, talking a lot about them. Talk about how that came about. Bruce we had a long relationship with them, so we will be one of the comanagers on the transaction. They have not filed yet but huge amount of interest, great company. Caroline lets talk about whether or not that spurs more green shoots. You cannot just have one deal. Are we elected to see a reopening . At the end of 2023, arm outperforming. Others have done well. We thought this was the reopening and then it shut again. Bruce it has required some patients the last couple years. When we acquired jmp, it was the Fourth Quarter of 21 and the markets were red at that point. As rates went up, the economy wobbled a little bit, that basically cut the interest a little bit in ipos. This year is the year that we will see a breakthrough. Caroline do the breakthroughs have to talk up Artificial Intelligence, the data it within reddit, expertise within different Industry Groups . Bruce i think ai is top of mind for the market but there are plenty of Great Companies around security, Different Technology services that i think will also see a lot of growth. That is what the market focuses on, what is the growth trajectory. That extends beyond ai. Caroline lets talk about your growth trajectory with citizens financial, how the market is supporting other regional lenders and banks such as yourself. A year ago that we were in the crux of the anxiety when it comes to regionals in the u. S. , explosion of Silicon Valley and the spillover effects. You managed to weather that storm, but your share prices are still under pressure, still pressure around commercial real estate. How are you seeing appreciation for your business at the moment . Bruce last year was a challenging year, for sure, with the idiosyncratic bank failures. Things have stabilized since then. Deposit position is very strong, Strong Capital position. Last year, we focus a lot on defense, making sure that our Balance Sheet was solid, putting away reserves for areas like real estate, where those losses are manageable for us. You cannot just wing playing defense, you have to play offense, as well. We have some rain initiatives. We have the citizens private bank, where we live to do bunch of folks from jp morgan. We are committed to this region of northern california. We havejmp. Best in class bankers. We are connected to the whole innovation economy, the seaworld, all the folks creating wealth here. We also have a big effort going on in new york where we acquired two bank franchises a couple years back, making great inroads in the new york market. The third thing we are high on is just our ability to Serve Private capital around the country. We build out an m a capability, sponsored coverage capability, so we are really anticipating, when private capital kicks in, you will see more deal flow in p e. Our pipelines are looking strong for the year. Ed a lesson i learned from a year ago, Silicon Valley bank, is how concentrated the access to working capital was for technology companies. Smes essentially. What was the one take away, permanent change of the last 12 months resulting from that saga . Bruce people were a bit envious about how Silicon Valley had locked in a lot of that customer base, First Republic also. Now the demise of those create an opportunity for folks. It is all about talent and commitment, its about strength of offerings and keep abilities. We are marching right into help fill that void. Caroline you will hear from those businesses, sectors at your event this week. Bruce van saun, chairman of the Citizens Financial Group. Coming up, lets talk about legal ramifications. Musk suing openai. Why this lawsuit matters. This is bloomberg technology. Hey you, with the small business. Whoa. Youve got all kinds of bright ideas, that your customers need to know about. Constant contact makes it easy. With everything from managing your social posts, and events, to email and sms marketing. Constant contact delivers all the tools you need to help your business grow. Get started today at constantcontact. Com constant contact. Helping the small stand tall. Caroline lets return to look at the elon musk lawsuit against openai file last week, alleging the company violated its founding mission, putting profit ahead of benefiting humanity. The vc community weighing in. Lets get a legal perspective for you. Christina gagnier is with us, and she focuses on intellectual property and areas that have caught the technology sphere and its focus. Is this some sort of a distraction, legal implications for openai, or will they for some sort of transparency as to whether or not Artificial Intelligence should be grown in a closed environment or indeed an open one . Christina the complaint is interesting because it sets out this framing of, openai was open source, nonprofit. That was this thing that helped it to thrive. This is not happening in a vacuum. Theres a lot of history between the parties. This is really about open source, nonprofit, and you see it across the Technology Space over the years. Interesting technologies came from the nonprofit space and remained open source. If there are issues with the technology that needs to be fixed, you have researchers, academics that have access to it. The idea that it is not for profit, commercialized, deviated from the original mission of what openai used to be, present some interesting issues. This is not happening in a vacuum. There are regulators across the globe looking at Ai Technologies right now. The themes of this lawsuit feed into that concern about the stewardship of the technology. One of the complaints is that the board itself of openai started out as this depth of knowledge about Ai Technologies, and one of the allegation is that the new board doesnt have that depth of knowledge. There is a larger stewardship question. The general consumer public, ai is still very new. Chatgpt is there. Ed christina, lets just hit the brakes for a second. You are an experienced technology lawyer. I dont think anyone really understands the root of musks complaint here. He is saying it started as a nonprofit for the best of humanity. Now he is saying that is not the case. What legal grounds does musk have, if any, to make that complaint, and what is he trying to change . Christina he is bringing a breach of contract claim, the basis of the lawsuit. I dont know what grounds there are. They complain is around this framing that the articles of incorporation as well as communications over the years, more on the basis of a founding agreement, that there has been a violation of that agreement. This was just filed last thursday. There are some issues as to whether or not there is standing in the case. That will be something that remains to be seen as the case progresses. The other thing that this lawsuit filing could also be is a device to get information. The parties have a long history. If the case were to survive a motion to dismiss, discovery could give the parties access to information they normally wouldnt have. It remains to be seen if this suit is really a betterment of humanity, openai lawsuit for the stewardship of ai, or whether or not this was a device to get information. We will see what happens over the next couple weeks. Caroline have you ever acted on the legal arguments that take issue with the fact that ultimately a company completely pivoted . Whether or not it is a pivot of business application model, nonprofit becoming profit, have we any precedent for that . Christina Many Technology companies that start as nonprofit remain so but part of this is transparency. Throughout the complaint there is reference to the transparency of the process, transparency between the opensource model and what we find today. A lot of this comes back to things that were well tread ground over the last year in terms of the transparency at openai, communications coming out of the company. I think this brings up some interesting and timely themes around stewardship of ai generally. Ed christina gagnier, grateful for your expertise. We will continue to track that case. Lets get back to the reddit ipo. The Company Seeking a 6. 5 billion valuation, according to bloomberg sources. We are jumping around here a little bit. The last private round, 10 billion, then the ipo may target 5 billion. We are up to 6. 5 billion. What do we know . It can be hard to guess exactly where the market will be when reddit debuts, likely later this month. They were valued at around 10 billion in 2021, but that was also the peak of the private tech market, so Many Companies are expecting they will be valued less when they go public. We heard early talks had them valued around 5 billion but now it is looking like ahead of the roadshow, bankers think they can get 6. 5 billion for it. Some of these things raise or even lower during the roadshow depending on how demand looks from Institutional Investors. Caroline is it Institutional Investors will be the mainstay for reddit . A lot of this will be trading on the exuberance from retail. It is a key retail name in so many ways. I am sure reddit would love to have those kinds of investors but bankers really target these large into two shall investors to hold the stock because they need large anchors that they can trust will keep the stock for a while. During this roadshow, they will market reddit to these investors, trying to get a sense of how much demand is there, and then set the price accordingly. Caroline we will keep an eye on all of those discussions. Meanwhile, we will keep you up to speed on the latest on a product iterations in ai. And announcing a model three family. More on that next. A discussion on ai applications and the safety of them. Bloomberg technology. Its easy to get lost in investment research. Introducing j. P. Morgan personal advisors. Hey david. Connect with an advisor to create your personalized plan. Lets find the right investments for your goals okay, great. J. P. Morgan wealth management. Ed welcome back to bloomberg you dont have to worry about things like changing tax rates or filing returns. Avalarahhh ahhh technology, in San Francisco. Caroline in new york, let us get entered on the markets, a little bit of give in the overall perspective of the nasdaq and s p 500. The s p 500 taking money off, a bit of calmness ahead of the jobs data later this week and continuing to build the narrative from the federal reserve, let us call it the s p 500 down about. 10 , record highs have been hit. Give up, a particular runup in the asset type, 4. 7 , we continue to push towards the alltime high of 69,000 all the way back in november of 2021. We have a look at the individual movers were keeping an eye on because apple is down 2. 7 but this is a big hit to the overall benchmarks, one of the magnificent seven and apple giving away significant amount of market value since the start of the year and questioning some of the sales that are going on and of course we continue to see some of the overall downward trajectory of apple and how it is splitting apart from the s p 500 and the weakness we are seeing from china. Weakness we see from china when it comes to tesla is based on the narrative, one of the key movers in terms of points as we think about the supply chain over there and demand