Day, al news 24 hours a powered by more than 2,00 journalist and analysts in 27 countries. This is bloomberg. [captioning performed by the national captioning institute, which is responsible for its caption content and accuracy. Visit ncicap. Org emily i am emily chang, and this is Bloomberg Technology. Coming up, tech mobilizes against hate with new game plans in the wake of the charlottesville tragedy. How Companies Plan to draw a harder line without compromising core values. Us cloud flair the c. E. O. Joins us with why the time was now to make a stand. And ali bulbas massive growth fueled bite cloud. The rift on Online Shopping and the monster First Quarter that beat across the board. First to our lead. It has been a chaotic couple of days following the tragic attack in charlottesville, virginia, and Tech Companies of coming together, committed to fight off who use hate speech. Newer startups like uber and air b and b are facing a newer challenge. For more, i want to bring in our bloomberg tech reporter, who covers facebook and other companies. I want to start with facebook and twitter. This is something they have been struggling with for a long time. The rules have been vague. They are still vague, but what are they doing now that is new . Well, these companies have for the longest time try to say listen, we are a platform for people to share their views openly. We may disagree with them, but we will only delete them from our platform if they are olent in nature, if they are inciting hate or something that makes other users feel uncomfortable. That hasnt always been the practice for a the lot of these accounts. A lot of the White Supremacists activity has gone untouched because people havent flagged it as much or there havent been event like this in charlottesville, which really highlight the risk here. Now these companies are being a little bit more proactive. We saw facebook take down eight groups that are were related to neonazi that they thought were prop gating hate. Air b and b are being very proactive. They deleted some peoples reservations because they cross referenced their user names with what they were saying on social media sites. Lets start with the content sites like facebook. Some of these White Supremacy groups have been using facebook to organize events. They have been using facebook for the purpose of coming together. I spoke with a partner at nters sewers about whether content companies should be going into the business of policing. There are some constraint about content, particularly inciting violence, but outside of that, it is a difficult place to be. I dont think companies can censor content legally or prudely. I dont think content should be send i dont remembered. Even if it is not the consent, he is saying these companies shouldnt sensor it. Where will they draw the line . Right now it is subjective. That is one of the problems with policies, is they all happen behind closed do you understand. Facebook says it has always had very consistent policy, those policies tend to be enforced whitner users report them. We were talking about facebook groups earlier. Groups are places that sort of hide outside the moderation on facebook. It is likeminded people talking to each other. It is a place where these kind of stories can go viral. They can go viral there, and then people may not report each other to cause them to take it down. What uber and air b and b are doing, how do you tell us a guest is a racist or a passenger is a racist. We have learned that air b and b actually cross researched the User Accounts with what people were saying outside on social media. It is a very unconventional approach they took where people were not actually espousing these views on the site, but off the site. Air b and b took that too account, probably for the safety of the People Holding them in their homes. Emily we have been talking about paypal cutting off relationships when it comes to payments on their site, apple cracking down with apple pay. Employees yesterday saying i disagree with the president and others who believe there is a moral equivalent between White Supremacists and nazis by opposing those and standing up for human rights. They run counter to our ideals as americans. Where does it stop . I think a lot of the tech leaders are having to come out and Say Something like what tim cook is saying. We saw Mark Zuckerberg yesterday. We saw the cloud c. E. O. Coming out. When you have these ideas prop gated on your platform, you do sort of have to think where do we fit into this . Are we a tool that is helping us grow . And i think a lot of the executives are grappling with it. It is a subjective problem right now, but a lot of the free speech advocates i was talking to say when you have a small set of companies and leaders deciding what should be on the web, there should be a little bit more transparency down the line for exactly how decidings get made. Emily we are going to talk to matthew prince about how he made that decision and what that means Going Forward of the cloud. Thank you so much. We are tipping this conversation, as i said with matthew prince coming up later in the show. Why he decided to cancel the account of the neonazi sigh, the daily stormer. They spoke out thursday between the relationship between President Trump and business leader, this after multiple c. E. O. s left the Advisory Councils when he didnt sufficiently condemn White Supremacy. They spoke about executives in the current climate. It is incumbent upon the Business Leaders here to continue to work on making sure that the things this country needs to be successful over the next few years, that we are still making sure we are playing a role in making that happen. Emily coming up, chinas Largest Online mark played boosted its ecommerce. Well break down the results next. This is plerk. Emily u. S. Stocks sold off today. Posting nd s p 500 their worst day since mid may. Tech weighed on the major averages, apple, microsoft and amazon were all laggards. Investors concerned over the terror incidents in barcelona and the controversies surrounding the trump administration. Alibaba hit a record high after posting record quarterly earnings. Revenue jumped 56 , and profit nearly doubled in the june quarter, fueled by a core ecommerce business. Joining us to discuss these ner ers, the managing part at capital and one other. Are you impressed that a company of this size can continue to post such strong numbers . Of course we are being impressed with the growth at this time. We also feel very vindicated, because for the last two years we have been stating that alibaba was going to be great. A lot of people had skepticism given the china downturn in economy, the stock market crash from two years ago, and alibaba has continued to grow and grow. I want to look at how Revenue Growth has progressed. Btv t your bloomberg z 474. It shows how revenue has grown over the last several quarters. They have spent time on the call talking about a new retail strategy, another area we are expecting significance growth. What does that really mean . Alibaba, like amazon and many other giants have been talking about how really the future of commerce is when you k9 offline shopping with Online Shopping. So alibaba wants to leverage the millions of consumers it has as well as data to deliver a mobile and that offers a seamless experience when you are in a brick and mortar story. They have had billions of ollars poured into this oliver this off line commerce. They have rolled out more than 10 stars around china. Basically you take the app, download the app, walk into the story, scan the goods with the bar code, check out with ali pay and you can have your own seafood there, cooked on the spot there or delivered to your home in 30 minutes. The executives are betting on this type of strategy to drive growth in the future. How do you compare what alibaba is doing here with these super market stores, which double as warehouses for orders. How do you compare to what they are doing with amazon . Trite now china, ecommerce is roughly 15 . That penetration rate is growing by 1 year on year. For alibaba to grow 3 on the year, they need to figure out how to tap sbe the other 85 of spending. Ey are doing that by combining off line with online. You look at what has happened ingentleman. You go to tokyo, you go to osaka, you see the high speed rail and subsway stations and tons of stations in there. In tokyo, you can check in your luggage at the airport, and it will get sent to your hotel. China has learned from that and applied that to ecommerce. I find it that alibaba is taking on grocery the same time that amazon it. Amazon did it after alibaba. How do they compare. You look at the mobile Payment Market in china. 2016 it is about 790 billion. That is seven times the american market. Chinese consumers are used to paying with the phone. They go to a story and see something they like, they can make a purchase. If the inventory is not available, no problem. The warehouse can send take to their home in the next po minutes. That is something we dont see in the u. S. You will see it happen more and more in china Going Forward. Cloud, another biand growing part of alibabas business, but they are losing money there. Talk about what is happening when it comes to Cloud Computing . They reached a milestone. They had more than a million paying customers, but we do see growth slow down. Digital media entertainment, we saw growth slow from triple digit growth to just 30 , which is still good. But in comparison to previous quarters, it is considerably less. A lot of the reason for the grows costs in those areas is because with the cloud area they need to spend on data center and with the entertainment division, they are spending heavily on content. Ere is a big war being waged between companies. They are bidding higher and higher prices for con end it. It is likely the prices will continue to widen. Hans shares have been on a tear. Is it warranted . I think there is a chance that ecommerce in china will move from 15 to 30 pass over the next to years. That will be a Good Foundation area for growth for alibaba. We will have to check in with you in two decades thank you hans and salena. Coming up, we bring you a company with big plans to take Digital Currency to the stars. How they plan to do it, next. If you look bleering news, check us out on the radio. On the app, Bloomberg Talk and sirius seniors, this is bloomberg. Emily facebook has proven to be popular among message fund. So much so that 52 of the fund have more than 5 of their snowsed Equity Investments in the stock. That represents 2 with respect of shares. Facebook peers have an average of five hedge funds that own more than 5 . Well, bitcoin showing no signs of slowing down. The Digital Currency climbed above 4,400 and hit a high on thursday. The rise coming despite the recent split resulting in the emergence of bitcoin cash. We sent it to Caroline Hyde in lone do not, who is joined by the head of a company with plans to take the Digital Currency to new heights. Great to see you. And new heights in every since sense of work. I am here with ad. Is a bitcoin infrastructure coy. The move allows them to offer a free satellite conditions to offer service to the Bitcoin Network even without an internet connection. Ad, wonderful that we can catch you while you were passing through london. First of all, lets talkle the emerging Market Element of all this. His is often cited as a utopia of bitcoin. It is the democratization of finance. How can people as far away as africa access bitcoin . Today, we take it for granted in the western parts of the world that we can spend is00 or less a month or things. That kind of staple infrastructure often doesnt exist in emerging markets so cost of participation is high. With satellite note work, we are bring the cost of participation down to basically free. Goes from 100 to less than 20 by renting satellite tv conviction. It is important when perhaps your foreign currency is not that. I am thinking nigeria and venezuela. Is this where you see a lot of the demand coming from . Right. There happens to be a coincidence of countries with weak infrastructure or poor network services, and maybe political instability, and also having weak currencies or currencies suffering hyper inflation. There is also a purpose it could be used in the developed world as well. Sometimes the Internet Connections arent always that great. It is not unheard of for Internet Connections for whole countries to go down for hours when a fishing boat digs through a transatlantic cable. For bitcoin, it is important to have a view of the global ledger. One way in which you can do that is have redundant connectivity. Satellite is an independent form of connectivity. Today we have three satellites and four coverage zones. But the additional satellite are going on by the end of the year to cover the full globe. Today, it is 2 3 of the worlds surface, but by the owned of the year, full coverage. We end up with a ring of satellites where each satellite is able to retransmit data to a previous one. Are you doing this out of the goodness of your hard . Block stream is a block chain infrastructure provider. We provide services to companies. By boot strapping this, we can grow the ecosystem. The companies that provide substance to users will buy mauer technology from us. It is interesting that you are just supporting bitcoin here. Is the theorem not up to it . Is your view that bitcoin is his going to be the digital assess of choice . It has the best track record. When people think about money, digital cold, they are looking for stable, predictable conservative k9 of things. I kind of things. It is fine that people are experimenting with new technologies, but bitcoin is the key. We are focused on that element, and we emphasize block chains, and because of dependability and security record, we build stability to build contracts. You have always made bitcoin more flexible in the ways in which it can be used. We have seen a volatile year. Suddenly a spike in the prays because the Underlying Technology has been upgraded, and everyone is following along with it. But there is an upgrade under debate. Does that mean bitcoin will forever be dependable . I think bitcoin is a bearer technology. Ultimately it is the users and market that defines what bitcoin is. The miners are a very important party. Ultimately they provide a service to the mark. It is the market that decides. As a user, you hold your own candidates. If you run a full mode, which is what the block stream satellite is about. What is that . If you want to participate directly in the Bitcoin Network, you should run a noticed that listens to the transactions around it. If you use a simplified client to the network, you are actually relying ton a third party. By using your own form of software, which is what Bitcoin Companies do, you are not relying on anybody else at all. In that circumstance, it is not really possible for somebody to make a change to your ownership or force a nonoptin upgrade to you. You have to opt in. Ad, great to have ad, great to have you. He is the c. E. O. Of block stream. To you in san francisco. Yoiment thank you. Coming up, standing up for principles or censorship . Matthew prince joins us on cutting ties with the neonazi site the daily stormer next. And a feature i want to tell you about, our interactive tv function. You can watch us live, check out old interviews, playing along with the charts we bring you on air. This is for bloomberg subscribers only. Check it out at tv go. This is goldberg. Got you outnumbered. The dinosaurs extinction. Dont listen to them. Not appropriate. Now im mashing these potatoes with my stick of butter. Why dont you sit over here. Find your awesome with the Xfinity Stream app. Included with xfinity tv. More to stream to every screen. Lets begin with a check of news. The Associated Press cites a Senior Police official who says neither of the two suspects detained in todays deadly van attack in barcelona is driver. 13 people were killed and 100 others injured when a van jumped the curb and mowed down pedestrians in barcelona, in what officials are calling an act of terror. The death toll is expected to rise. Islamic state has claimed responsibility. Police say troopers also killed a man inside a car that hit two officers at a traffic blockade. Some Harsh Criticism today of President Trump from Tennessee Republican center bob corker. I do think there need to be some rad caggiula changes. Some radical changes. He has not coyote. Able to demonstrate the ability nor some of the competence that he needs to demonstrate in order to be successful. Senator corkers remarks came two days after the resident declared that White Supremacists dont bear all the lame for this weekend. President trump called senator flake called him toxic and weak on borders. He called him a principled legislator. It is just after 5 30 p. M. Ear in new york, 7 30 friday morning in sydney. Paul allen has a look at the markets. Good morning, mark. No surprises really that futures in the Asian Pacific are looking weak. We have nick futures down nicka futures down. All weighed down by the political scene in the u. S. Mixed earnings, and