Transcripts For BLOOMBERG Bloomberg BusinessWeek 20160501 :

We did a story that showed that six major cities had amazon primes oneday Delivery Service was available, but it was not available in predominantly black areas and was not the intention of amazon to discriminate but the results were there were these lines. In boston, it was extremely obvious because the Delivery Service excluded roxbury and was surrounded by areas that were able to get the prime one day service. There was a hoopla and the mayor asked questions and senator markey of massachusetts demanded answers. As of today, amazon have that backtracked and said roxbury will be getting this oneday service now. David in the Global Economic section, an amazing piece about wild cap minors going after amber in wildcat miners going after amber in ukraine. Ukraine is a bit of a mess. They have rebels backed by Russia Fighting in the east. There is a lot of tension still going on in the economy is really bad. In certain areas, people are illegally trying to mine amber , which is made of resin from ancient trees and its the lovely orange gem that is very expensive. They are going in there with their equipment, and whenever the police is around or authorities are around, they scatter and they are trying to make a living doing that because it is so hard to make a living in ukraine right now. David it is a really messy process. It is an messy process. You have to dig into these ancient pools of water and sometimes these gems are getting damaged and cannot be polished properly. In a way, they are making things hard for themselves because the gems are not as valuable, but it is a desperate attempt to replace lost income. David what is the Ukrainian Government doing about it . I imagine it is costing them some money. It is costing them a lot of money. So many of their resources are being directed at other things. They are trying to do something about it but they havent made much headway. David the cover story is about yahoo with bids being tendered and people are looking at the tenure of Marissa Mayers. What is the story about . Ellen the story looks at all the pressure on yahoo and whether the ceo could have fixed it. Yahoo is an old tech company as Silicon Valley goes. It has a ton of problems and a lot of its value lies in its stake in alibaba which will probably spun off in one way or another, and there are tax problems associated with doing a fullfledged spinoff. The question is, could she have fixed this company . She has been focused on creating new products, but it has not really made a dent on its problems. Yahoo , atom line is, company with 9000 employees, all of these services, it weighs you and me end our parents get on the internet. Company,ne part of the and then there is another part of the company that is a stock portfolio. That stock portfolio, all by itself is actually worth more than the entire market value of yahoo because there is complicated tax situations and the fact that investors have lost confidence in the ceo, Marissa Mayer. Carol take us back because at one point it was a successful company. Max fifteen years ago it was the bees knees, unstoppable. It kind of went into decline that starting in the early years during the rise of google. A little bit more recently, around the time of Marissa Mayer took over with the rise of mobile. You who makes money through banner ads and they do not work well on cell phones, and as a result, she inherited a position that was in a lot of ways almost impossible. Carol when she was brought in, everyone thought, what a great move. A lot of people including directors, investors were kind of charmed her star power, and i think they lost sight of how challenging this would be. If you want to lay some blame on the management of yahoo you andt say that Marissa Mayer some for Management Team got taken in by the same, we can do anything kind of feeling, where this was really a troubled company from the jump. Carol who knew that changing coffee at their headquarters would make a difference but a it changed morale a little bit. Its funny to look back at the press when she first took over. She made lunch free and everyone said thats amazing. Wind the clock back just a few months ago, investors were talking about her profligacy and acting as if she has spent all of this money on these perks and nothing had come of it, so really showing you the way the narrative has shifted just in six months. Carol she also went on a buying spree, bunch of acquisitions and paid about 1 billion for one company. Did they make sense . It depends are you ask. On who you ask. One acquisition did not pay off which was tumblr. That did not work out so well. They have written down a good chunk. The smaller acquisitions, some people caught a buying spree, but i think that is open for debate. What she has said, and i think there is some choose to it. God who needed to hire people. They needed to hire smart people, and that is how it is done in Silicon Valley. Strategyhat was the and is sort of worked. Carol what is more a set of meyer running into, that she could to keep the job . Where is this all headed . According to the people we have spoken with, it seems unlikely. What is most likely going to happen is you who will be sold to verizon or a company like it. You have to sort of wonder, even if Marissa Mayer were allowed to keep the job, which you want to . She is a product person. It seems like what is going to happen over the couple years, there would be a lot of cuts, integration, corporate synergy and it is hard to imagine that she is the best person to do that or she would even want to do that. It is much more likely she will wind up at a venture capital. Irm or a startup she is very talented. I think this was a case of may be a benefit. You may have noticed the eyecatching yahoo cover page. We were visualizing yahoo s last ditch effort to save itself envisioning selling the company. What is interesting about the state of affairs, is everything you associate with yahoo , the entire company, the nostalgic feelings you have toward it, all of that is a negative asset. We tried to put that sort of desperation in a form that people would recognize. David did you come to this immediately . We arrived at it pretty quickly at one of the early meetings. We knew we wanted to scratch out the whole rummage sale, firesale, cheap aesthetic of little bit. What we ended up with was something classic, business week, good, mean fun. Carol up next, the high cost of battling the fcc. How one man lost everything. Unionizettling to tmobile. Carol the man that couldve been the biggest influence on how capitalism involved evolved. Yes, its Alexander Hamilton. David all that is ahead. On bloomberg businessweek. Carol welcome back. David this weeks feature section, an investigation as to what brought down lab m. D. Carol and yes, hacking was involved and we spoke to the editor about the man who led the fight. He had a Small Business doing ng and he lost it all when his business was hacked and the hackers try to sell him protection from people like them. Carol nice of them. He declined to buy their protection and the hackers turned him into the ftc which try to make an example of him. David he fought back against that and thats with rare about his story. The ftc, in terms of what it requires and what you have to go through, it is so onerous he alleges that many others would just settle flat out. Every other Company Caught in things did settle. There are 60 cases in which the ftc brings these data privacy cases in. Its an extension of a obligation under hipaa. In every other instance, the business did the math and decided it made more sense to settle. Carol he got a second lifechanging call that made him realize he had been had. He got a call from somebody who worked for the hackers. Carol richard wallace. Right. This person said, i was engaged in taking that data from your company, reaching into your network, that was me. I did that in other instances as part of a campaign. That is what he said. That finally changed the story, change the game. Without the testimony he called him over a series of years and he testified to the same things before congress and a subcommittee, a house subcommittee, and finally made the same testimony in the ftc court. Carol that was a long track. He lost his entire business in the process. Carol in this weeks industry section, a look at how unions are challenging tmobiles inhouse workers. Cwa, the Communications Workers of america, when they supported the move by Deutsche Telekom, the German Telecom giant, to take over the predecessor company, they had some hopes that this more Union Friendly Company Coming in would mean this would be an easier company to organize, but instead we have seen a decadelong struggle between the union and the company in which the union, and in some cases the National Labor Relations Board prosecutors have accused the company of not following u. S. Labor laws. We have seen for Deutsche Telekom some heat from politicians in the u. S. And germany and some investors over these alleged violations of labor laws. Decademeantime, cwa, a into their campaign has not been able to get collectivebargaining contracts for any more than a handful of the 45,000 employees there. Are really talking about a handful, just dozens even . That is right. Ens ofare doz employees that say they want to be a part of cwa but they have not been able to get contracts for more than a few dozen workers at tmobile. Do they have grievances with tmobile and Deutsche Telekom, or is this more blanket, we want these employees to be unionized . The concerns they have raised workload,sure, people being told to wear a dense cap if you do not get your work done in time, or people shaking chairs to get the work done faster. This what is novel about is what tmobile has done here, rebuffing the efforts for these workers to unionize but also trying to find a new way to voice some of these grievances and workers are kind of skeptical about that. Weekseveal in this bloomberg businessweek, a new fight that seat of ui is alleging tmobile has taken a page from American Companies in the 1920s and 1930s i illegally setting up a socalled company union. It is a Labor Organization that looks and sounds in some ways like a union and that it is made up of employees and deals with management on workplace issues, but in fact is controlled by the company. This is an Organization Called tvoic that they rolled oute last year and described in emails to employees that it is made up of representatives and it is their voice. Tmobile has sent communications tvoicers crediting with changes it is made in workplace perks like wifi or cell phone charging stations, and so from the perspective of the union, this is illegal and misleading. Rather than having an organization you deal with with worker representatives elected by workers, youre having an organization that you tell employees is their voice, made up of representatives chosen by the company. David up next, a coalition of companies any together to fight antigay loss. Carol if you are looking for the perfect beach this summer, we have a travel guide for you. David welcome back to bloomberg businessweek. This weeks politics section. Carol the Corporate Coalition fighting 2000 antigay bills are being considered across u. S. South. You have what is going on in North Carolina, the backandforth as they try to get the legislature there to resend the law. You also have tennessee and South Carolina which seem to have acted out and they do not seem to be pushing this far forward. You have mississippi, considering a set of rules. You have missouri considering a set of rules, and they are all kind of just moving day today day, simmering backandforth determining which of the laws are going to be the one they are focused on at any given time. North carolina will be prominent and then it will switch over to missouri or mississippi or tennessee. It all depends on what someone is doing at a given day. We are looking at 30 plus states and 200 or so bills, so he could pop up anywhere at any time and we are nowhere it knew the end of it. Carol you know who is not sitting quietly are a lot of the wellknown, best wellknown corporations around the country, u. S. Corporations . What are they doing . Names inf the biggest businesses are writing letters, coming in with active meetings with their staff to talk, especially in cities where they have a big presence. If you have a salesforce particularly active in indiana, where they have a lot of people in georgia, a lot of people in your shift to use the paypal bringwas considering to people into North Carolina where they are active, disney active the georgia based on some things with entertainment. You can see the Companies Getting involved where they have people, and that is clearly starting to become maybe not enough. Carol not enough, so that means what they are doing is actually opening up the wallets, right . Now this funding is starting important on be how they are going to move for. It needs to be coordinated. We need people to say we need another 50 signatures on this letter. In many cases, the right 10 companies at the top of the letter mean the next 200 companies will sign on because this is a new space for american businesses. Carol what is next in this fight . Is there another state that is the next battleground . We are still waiting to see what happens in mississippi and missouri, and you look around the country and they are some states with 20 potential bills, but what they do not know is when something will suddenly pop. North carolina, no one knew it was going to happen until it basically happened. Charlotte said we are going to let people who are transgender jews the bathroom of their choice, and a most overnight the legislators say, no you are not. More time andhad the duo is coming, and the practice at last year in indiana do get a sense of how things should be done. Is a game of waccamaw whack a mole. David i asked the editor about travel being highlighted in the issue. Airlines like american and qantas have introduced daily nonstop from San Francisco and los angeles. Its understandable. It is an incredible food scene. Even in sydneys winter it is place told or in the go. David its a long flight. We have a couple of suggestions. You can stay in los angeles. You can do one that screens movies on the roof. A lot of fun. But also qantas and american have some pretty awesome firstclass lounges. If you are actually not flying first class you can still pay to use them and they are actually worth it. David you present an alternative, it will town north of cancun. Yes. It is 26 miles of mangrove. It is also carfree. Which is really nice. Isla holbox. You can find accommodations that range from 100 a night up to 400 a night and you can snorkel without sharks. Beach can just sit on the and you do not have to fly for 15 hours. Carol up next, more from the travel guide. David plus, the mississippi town that may end up regretting ooing the atlantic braves. David welcome to bloomberg businessweek. Im david gura. Carol and im carol massar. David still ahead, why minorleague ballparks are rarely a good idea for small towns. Carol and how amazon developed its hit, the echo. David and how to vacation like a king on the company dime. Carol its all ahead on bloomberg businessweek. David im here with ellen pollock, the editor of bloomberg businessweek. So many mustread stories in this issue. Lets start about the opening remarks about Alexander Hamilton. Secretary treasurer jack liu is going to keep Alexander Hamilton on the 10 bill. This is an historical figure who is been really lionized in Popular Culture over the last year or so. Ellen our economic correspondent peter coy takes Alexander Hamilton off of the broadway stage and actually talks about his economic policies. His contribution to economic thought in the u. S. And now it has had an impact even today. One of the things he did was sort of question laissezfaire attitudes of adam smith and really stressed that the government needed to be able to tax, and that the government needed to spend money. He said power without revenue is a bubble. Im not sure what that means, but i think it is really important. He also stressed the u. S. Needed a Manufacturing Base so it could compete with other markets. David in the markets and finance section, you will get look at snowbirds, folks who live in canada been on Vacation Property here in the u. S. A huge percentage of vacation homeowners from overseas and the u. S. Are in fact, canadian. That is starting to change. Why is that . You have to understand that canada is cold in florida is warm. Its been a natural place for canadians to invest and have second homes. Now, the Real Estate Market in florida is getting kind of soft. In the canadians desire to sell and take their gains is part of it. One of the things thats motivating the canadians is the strength of the u. S. Currency. Their gains are not looking quite as good and they are paying maintenance fees and other kinds of fees, property taxes in florida. And taketrying to sell their gains and invest them elsewhere. David does politics play into this . They are. We have to talk to a canadian family that owns to vacation two vacation homes. Theyre going to sell one of them, and one of the things that worries them is how this election is going to end up. Its not like they are for one candidate or another, its just the craziness of the selection is just worrying them. David the feature piece in this