Embassies in africa. I am Alisa Parenti. This is bloomberg. Bloomberg technology is next. Cory i am cory johnson and this is Bloomberg Technology. Befores its final stop the big ipo planned for later this week. Investors question its growth. Warren buffett takes a bigger bite. He has purchased more than 100 million shares of apple. Spacex shoots for the moon. Two a name to citizens have put money down for a lunar mission. As wall street prepares for the first tech ipo of the year, snapchats Management Team make s its final roadshow in San Francisco. Investors are pitching the company to investors. Million users but growth has slowed to 3 . Joining us now, sarah frier. This user growth issue to me is one of the biggest issues with this company. When you look at the sequential user growth, is slowing down. Sarah it has been a top question for snap executives at the roadshow. And in new york, a lot of people we talked to who went to the roadshow expressed skepticism. Their answer to the user growth issue was it was due to some issue with their android product. Worried maybe are this is because instagram copied snaps product in august. Exactly when story happened is when their user growth started taking. Sarah that is one thing prequel worry about. Snap said they see instagram is a different case. Calm theirt seem to fears about growth. That was at the roadshow in new york. Cory they were in San Francisco today trying to pitch that story to investors. ; it is a lot of stock but there is lazy of demand. This is the first big tech ipo in a long while. The last big one was twitter. These are companies that people wait a long time to get into. If it is a facebook situation, even if it has a rough first year, it could be a Good Opportunity over the longterm. If it is a twitter situation cory it is hard to imagine what the negative growth margins, theres a great deal to be had. I started building a model of the company this weekend. The cost of goods, the money spent historically. I put together a chart to show this. The cost of serving each user. The cost of goods sold compared to have the users they get. Over time, you see the opposite of what you want. They are spending more on every user every quarter instead of less. Since they dont own their own servers and rely on google, that seems to be an issue for them. Sarah it is definitely an issue in the minds of investors. They have aed different cost structure that we are not as used to. They are not in the business of building servers. That is their response to that. Question is, are they going to be able to increase the amount of money they make . Are they going to be able to scale the advertising business to the point where it becomes profitable business . Cory what is the timing of this deal . Sarah we are expecting it to price on wednesday and lift on thursday. Cory price wednesday, trade on thursday. There should be excitement. We will have you come back on. Great stuff. Sarah frier from bloomberg news, thank you very much. , the annualthaway letter was a great thrill. The company doubled its stake in apple. Warren buffett says it now owns 133 million shares. Katherine chiglinsky joins us now. Is this Warren Buffett or other Money Managers as well . On cnbc earlier today to talk about the investment in apple. He more than doubled his stake in the technology company, which is a lot more than we learned at the end of december. He mentioned while he manages the bulk of the investment, it is one of his deputies that pitches the other bit. That is interesting because he is adverse to technology shocks. He showed his flip phone on tv today. He is not that into technology. It shows the growing influence of his two investment deputies. He did not clarify which one it was, but it is an interesting sign that he is willing to plow into the company. Cory it is interesting to me because one thing i noticed in the letter was up all of the stocks they listed was of all thehe stocks they listed, only loser in all of his holdings is ibm, a company he has lost money on and has been invested in for many years. Three or four years. There was no commentary in the rest of the letter about that holding. He has taken some heat for being so bullish on ibm for a while. That stock has done much better. It rallied the past year, especially since the election. He started to exceed the cost of purchasing that stock. He definitely took some heat when it was not doing well, sticking with it proved ok. It is interesting that now he is like ibm was good and apple might be even better. Cory it is interesting we have seen so many tech leaders over the years who seem to have a great love of Berkshire Hathaway and understand that business regardless of its lack of overt technology. If you look at the railroad, if you look at so many of the holdings, all of these companies are being transformed by technology. He is Buffett Knows spending money to make these Companies Better through technology. Definitely. You cannot avoid that conversation forever. He mentioned on cnbc today is budgetary mentor questioned some of his bets a little bit. He said i cannot avoid things forever. Things are changing. That does happen. I think that is what he is saying with some of these different bets, with apples, with airlines. They had a bad First Century but they are doing better now. I think he is willing to change his mind. Cory airlines is one he has always hated and regretted. Katherine chiglinsky, thank you very much. Executivethe chief opens up about president trumps expected tax overhaul and gives us a look at how complicated taxes can be for businesses in technology. This is bloomberg. It cory softbank is said to be working on a merger with a satellite company. Softbank invested 1 billion in december according to a person familiar with the matter. Talks could still fall apart as other options. The transaction could be valued at 18 billion if successful. Reports results on wednesday. Details are expected before a joint session of congress. May comes to the multibilliondollar videogame business when it comes to the below multibillion videogame business, it is not easy. The new tax policy could have unintended consequences. I think the biggest opportunity on tax policy is the repatriation of cash trapped overseas. To be clear, that is not a take to issue. 90 of our caches domestic. It is a broader issue for our economy. Cory we have had the tax repatriation holidays. In the past, that has gone to stock buybacks and special dividends. One can argue it trickles down to the economy. One can also argue it does not. Has not gone into hiring and spending. This administration has talked about job creation. I think it is the primary goal of the administration. It seems you could tie favorable treatment to repatriated tracked cash, to whether that is invested in the economy as opposed to buybacks or used to pay dividends. You could tie them in the same way exchanges in the real estate business have obligations and timing restrictions to generate tax benefits. Cory as it relates to the gaming industry, the border tax rules are interesting. The way you develop software, you may develop some in canada, a lot in the u. S. Some of the same software in the u. K. How do you tax what is made in canada versus what is made in the u. S. . It is all lumped into one game. It is possible to do it. The question is is it something that benefits our economy. Generally speaking, erecting trade barriers is not something that generates value in our worldwide utterly major collection matrixengaged system. Our industry is especially interested in low or no barriers to trade because we are an exporter. We are one of americas largest exports, india came in general. I think we are the entertainment in general. I think we are the second largest after aerospace. Having as few barriers to free trade as possible benefits our industry and certainly our country. From our point of view, we want people working at their highest and best opportunities. Is a trainederica economy. We like the fact we have worldwide engagement and can put jobs where they belong. We are a big domestic employer of course. Cory as the products are more digital, you can play that out to entertainment, movies and so on. As they are increasingly digital , what you are selling is bits and bites and lines of code. Where it is written may determine if it is made in america or not and how the tax policy works. It has to be confusing for condos and the white house to figure out what that means. There are certain rebates triggered in foreign jurisdictions. There are rules around what constitutes local work. I have no doubt one could make rules and make those work. The question is, would it enhance or detract from productivity, achievement, and the overall Macro Economy . I am suspicious we can be so smart in centrally planning trade restrictions that it is a net positive. Generally speaking, free trade is a net positive. Cory it also seems that valuation placed on the i. P. Versus the actual creation of the code is a balancing act. Is the a. P. Is owned by a u. S. Company but the code is written in ireland, where is the work and how will it be taxed when exported . All the questions. Cory how do you help Congress Figure that out . We encourage congress not to erect trade barriers. I think that is the focus we have. I think at the end of the day, because the sitting legislature is republican dominated and typically republicans are believers in free trade, that ultimately there will be negotiation with our president. I think we will end up probably in the right place. Cory where is your development intak take two . We have people in california, massachusetts, baltimore, canada. We just acquired a company in spain. We have a bunch of people in the u. K. , some Czech Republic and china. Cory these are interesting challenges. Absolutely. Way it is possible in a you could not have done before with teams working roundtheclock. Everything is connected electronically. In dont need to be sitting next to someone to work collaboratively with them. Cory that will increase in the future. We should avail ourselves of expertise where we find it. If we are smart in america about increasing our engineering talent, which is a big issue here, through improving our educational system and focusing on engineering, those are very highpaying jobs and we and all of our competitors are hiring hand over fist. We all have open positions. Cory taxes. We are talking about taxes. That was strauss zelnick. On tuesday, we will have special coverage of president trumps address to a joint session of congress. Toing up, we will take you techs biggest showcase. The Samsung EuropeanVice President of mobile and how they plan to bounce back after the note 7 saga blew up. Our interactive tv function is right here. You can watch us live. You can see old interviews. Look at bloomberg functions and become part of the conversation by sending me a message during the show. Feel free to interrupt me as much as you can stand it. Free for bloomberg subscribers only. This is bloomberg. Cory everyone who is anyone in mobile is in barcelona right now. What you will not find in barcelona this year, a Flagship Smartphone from samsung, the largest maker of phones. The v. P. Of the European Mobile division. We have been through a big challenge with the note 7, one of the Biggest Challenges in our history. Learning, andof we want to demonstrate today that quality is part of our mission. We want to thank all of the customers that stayed with us the noteembraced more 7 in the past few months. Stillemonstrates we are wellington with our customer base. We owe them more innovation and quality the future. That is what we are showing today. Will you refurbish the note 7 . Many loved it. Many seem to be taking it back. Will it be going back on the market . To findnk we are trying to disperse the products in the most responsible way. We are working to find the most responsible. Samsung has been known to , sometimesation putting out equipment early in the lifecycle before they have been practiced. Do you agree . Do you think you always wait until it is at the best possible moment and then release . I think sometimes we are early. We are ahead to drive the market. One of our responsibilities as one of the biggest dealers in the industry is to drive it forward. We have demonstrated this last year, actually a couple of years ago, with the big event last year to bring it to the next level. Yesterday, we also announced in the vr, the new controller which will bring a new dimension to the vr experience. I think we like to say we are early in the technology and bringing new technology and democratizing them to a wider audience. Vr is very hot. A. I. Is very hot. Is a are coming is a. I. Coming . Can you elaborate . I wish i could elaborate. There are many things in the labs in the moment. We have acquired companies in different areas. We Leverage Technology the best we can. Wille now announcing we tune speakers on the new tablets with one of the most Famous Brands in the sound industry. We definitely will use all of our technology. 8, will it sell more in terms of quantity . We are always confident in our products. That is why we make them so attractive and sell them to as many people as possible. Demonstrates the innovation is relentless. We launched with the tablets yesterday. Some of the features introduced another manifestation of how innovative we can be. We created it with the first note several years ago. Now it is in the tablets as well to give more experience to our users across our portfolio. When you dont launch a phone here, everyone starts to look at who is. We have been shining light on lg. Another wants to eat away at yours and apples market share. Does it worry you and they are coming out with new phones when you did not . We always recognize there is competition in the market. I think it is good for the market. It is good for us as well because it pushes us to bring more innovation. It is not just about launching a new product, but serving customers with experiences. Samsunghe strengths of as a big company is we can deliver not only a true portfolio but a full because one size does not fit all. Cory that was samsungs Vice President of the European Mobile division. Coming up, we check in with the godfather of Net Neutrality, tom wheeler. His view of the future of internet regulation as some of his rules are being undone by his successor. That is next. Elon musk aims for the moon with the surprise announcement he has significant deposits for a Space Tourist Mission around the moon. We will check with our spacex reporter later this hour. This is bloomberg. I am Alisa Parenti and you are watching Bloomberg Technology. Lets start with a check when you first word news. Mexico says it will cut off renegotiation on nafta. The economy minister tells bloomberg the moment the u. S. Says it will put a 20 tariff on cars, he is leaving the bargaining table. The french president ial candidate has opened up his and has pulled within two points of Marine Le Pen according to the latest polls we have seen. Macron commanding a 25 piece of the french electorate. His surge is said to be pushing by increasing endorsements. Both surveys show le pen losing in the second round. Theresa may is preparing for battle in the house of lords overheard draft brexit law. She and her team have demanded lawmakers in the upper house of parliament not rewrite the legislation while debating it. May remains opposed to a second referendum on scottish after reports scotland is preparing to call another vote. Scottish leader has repeatedly said another referendum is likely. Police wass secret involved in the killing of kim jonguns brother according to the New York Times citing south korean intelligence. The killing is being described as statesponsored terrorism. Global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. I am a lease of karin bloomberg. It is just after 5 30 p. M. In new york. I am Alisa Parenti. This is bloomberg. David, good morning to you. Feeling the tail winds blow across the pacific in singapore. You look at early indications. It does seem we will be shaking off the dull session on monday. Features for japan and australia open in 30 minutes pointing to a higher open. Yields in sydney higher. Lots of data to latch onto for traders. The big one is india gdp, largely expected to reflect the negative affect effect of the demonetization efforts. Pleading guilty to one count of wire fraud. We are talking to the president of universal robots about this new wave of Automation Across Industries and countries in the asiapacific. A lot to talk about today. Im really excited. Singaporeingles in with more from Bloomberg Technology. Cory this is Bloomberg Technology. I am cory johnson. Our top story this hour, snapchats Parent Company continues its roadshow. The highly anticipated ipo set to price on wednesday after the market closes. They are continuing to pitch the company to investors and explain away the phone growth. Who is us, alex barinka very excited about this deal. Crawford del prete also excited. What is your take on this deal . This is a tough one. Snap likes to say they are a camera company. And then they go on to talk about how they compete with anthonys like apple and facebook. I would argue snap is an that has oneompany key case one demographic is interested in. They are struggling to add use cases, to add features that will get the growth accelerating. That is the problem. Alex, youhat point, have been talking to people doing these roadshows. I assume you have talked to people who invest in ipos. What are they saying about this deal . Crawford is hitting it on the head. They are trying to figure out how to make money off the millennial gen