Newsmakers in the world. Not just in technology, but in the world. Inyahu net and y in Silicon Valley, trying to make better connections with Technology Companies. We spoke to him exclusively. It was an interesting conversation we had about that. An interview with eric schmidt. With eric schmidt, the executive chairman of google and jericho and. Cohen. Jericho we started by talking about what is happened the last what has happened in the last year. The paperback is out this week. Since they wrote the original , i asked if anything had changed their conclusions are predictions. If he read the book a year ago and you read this version and you look at the epilogue, a lot of things we talked about is happening. He talked about the dangers and issues around old leaking. That has occurred. Most interesting thing has been the unpredictability up local change because of technology. At the time we wrote the book, we really do were unsure that the revolution in egypt would produce a pseudodemocratic government. We are back to square zero. If you look at ukraine today, no one has a proposal for how to do it. What we have learned is there is some kind of limit to technological optimism. You can empower people thats our position. Ultimately, the gun kills peace. I was just on the Syrian Border about three weeks ago. One of the things we had written about in the book is, governments in the midst of conflict will become so concerned about empowered citizens that they will literally set up check winds to complicate phones or see whats on them. From my i hear friends and syria . The government has set up checkpoints and they ask you for your phone. If you are not going to give them your password, they hold a gun to your head and ask you about it. Checkpoint sawhe post on his wall that was sympathetic to the revolution and the signal came from the checkpoint up to the rooftop of a nearby building which then resulted in him getting shot in the head. This is very real. Re areot just that they Cyber Security issues. Are ine citizens that virtual and physical crossfire. There are videos coming out. It what eric was saying come ultimately, the world is still governed by militaries. The country is not willing to step up and intervene and the situation will continue. We are entering an era of uncertainty. We are in a beautiful spot thats very peaceful. A few kilometers north bus, between a horrific town involving 35 People Killed and houses being burned. Horrific stuff. We are reading about this. Theur view of the world, internet should be a moderator and allow you to say, we understand your culture and we are more accepting of you. The internet was used exactly for the wrong reasons. It was used to inflame the passions on both sides. We are in a danger zone in countries that dont have proper societal tolerance or educational systems or rule of law where the stuff can be misused. Technologies used on all sides. By government and protesters and hackers. How does that play out . In the early days of the protests in ukraine, the first instance in which it was spelling trouble for yanukovych was when he made the decision to shut down channel five. He cannot do anything to stop social media. All it did was give people an additional thing to complain about in the various microblogs. Once he lost the information environment, he lost the military. With an explosion of grievances against the autocratic regime we do have breaking news. President obama speaking about at the white house. The sovereignty and territorial integrity of the ukraine. Or for stealing the assets of the ukrainian people. According to my guidance him of the state department has put in place restrictions on the travel of certain individuals and officials. These decisions continue our efforts to impose a cost on russia. Those responsible for the situation in crimea. They also give us the flexibility to adjust our response Going Forward based on russias actions. We took the steps in nation with our european allies. Ive spoken to several of our closest friends around the world and im pleased that our International Unity is on display at this important moment. Readye moved together all to announce substantial assistance for the government in kiev. In brussels, our allies took some steps to impose costs on russia. Im confident that we are moving forward together. United in our determination to oppose actions that violate international law. And hes a poor the government and people of ukraine. That includes standing up the for the principle of state sovereignty. Wouldture of crimea violate the ukrainian constitution and violate international law. Any discussion about the future of ukraine must include the legitimate government of ukraine. In 2014, we are well beyond the days when borders can be redrawn over the heads of democratic leaders. While we take the steps, i want to be clear that there is a way to resolve this the interestsrves of the Russian Federation and ukraine people. Ensure the rights of all ukrainians being respected, including ethnic russians. Confrontations between the russia and ukraine. Russia will maintain its base in crimea provided by its agreements to respect their sovereignty and territorial integrity. Support the people at ukraine as they move to elections in may. That is the path of the escalation. Kerry is involved in talks with all parties to discuss those acts. With this violation of international law, the result will be the United States and our allies and the International Community it will remain firm. We have taken steps to reaffirm our commitment to the security and democracy of our allies in eastern europe. And to support the people of ukraine. One last point, theres been a in congress about these issues. Im calling on them to followup on these words of action. Specifically to support the imfs capacity to lend resources to the ukraine and provide american assistance for the Ukrainian Government so they can ilizeer the storm and stab their economy, providing a smooth the pathway for the elections that have already been scheduled in may. Today, the world can see that the United States is united with our allies in upholding a international law. That is what we will continue to do in the days to come until we have seen the resolution. Thank you very much. President obama speaking at the white house, pushing for a diplomatic solution in ukraine. To our washington correspondent. What do you make of the president foster their . Points here two key was tried to touch on today. The sanctions and visa bans that were put in place by the administration this morning. He signed executive order this morning. What the u. S. Did with that was took the lead. Shortly after the u. S. , the eu started following as well. When it is there is a visa ban on russian citizens with visas that were anyway involved in what is going on right now in crimea. They are proved they approved a sanctions regime that will be put in place raided the president made very clear the reason for his public remarks today the referendum by the russias about joining and leaving ukraine entirely. The government in kiev has already said that this is ridiculous. Ceu and the u. S. Have come out and said absolutely not. You cannot undercut your own central government. This referendum that is in place upon the folks in crimea to leave the ukraine, that is the big issue right now. It is causing concern. They have made it very clear moscow doesntat response would be considered legitimate unless it has the signoff of kiev. You will hear more and more in the days ahead about the fact that this is something that needs to deescalate. To move over into russia would be considered an escalation. That is why the sanctions regime was set up and approved today. Russiaimposing costs on without using the word mean we wills that see sanctions escalate your . I think thats the threat. That is the hammer they have right now. The point it ministration officials have made is, look, there will be punishment for what has happened already. That is where you see the visa bans. The citizens that were involved in whats going on increment a right now. The sanctions are not in place yet. In whats going on in crimea rainout. In crimea right now. At the white house, thanks so much. It john kerry about to speak in rome. We will be following that as well. We will be right back with more after this quick break. This is bloomberg west. Back with an interview with eric cohen. T and jared the most important topic we discussed, nsa and edward snowden. What is the state of googles relationship with the nsa . What relationship . [laughter] they didnt knock. They didnt call. They didnt send a letter. They just visited. [laughter] the latest revelations from towdon that the nsa colluded intercept and save images in yahoo video chat. What are the chances that happened to google video chat . We look forward to more disclosures from the nsa on this matter. You guys, facebook have gotten together with Different Technology companies to petition changes in washington. Confident are you that they will do that . There is section 215 through a series of legal arguments, it allows the recording of metadata of american phone calls, roughly 350 million american phone calls. Every call you make recorded in these databases to target 56 people of watch one was a suspected terrorist. If that isdetermine an appropriate use of government power and so forth, that is what they were doing. The group that google was a part off took the position that this made that metadata collection was not appropriate. This issue is problematic. Because of the possibility of things of future leaking. The president announced in january a committee which i am actually on to try to figure out what to do. He said to the nsa that he does not want them to keep the data but he wants others to keep the data. We are working on what the choices are. Ill take the president s word again. He is sincerely trying to address this in the balance of interests. In the book, we say quite a bit about this. In particular, we say that democracy will have this debate. Now that we know it is going on and you will find the right balance of this interest. And i askedaround the question, what rights or privacy would an american give up if there were a terrific terrorist attack once a year . Me,average american says to im fine with that. You ask the same question in germany and the answer is, we are not fine with it. You ask the same question in britain and they say, whats the problem . You ask the question to israel and they say, what when it or lane and are you on . In the book, we say that governments have to have this debate and find that balance. There was no cilantro. Recount a 5. 5, we interview a 5. 5 hour interview. He was under house arrest in the u. K. Come wearing the ankle bracelet and everything. The conclusion we came away with was that bulk leaking will continue. Made ithe arguments we is, who appointed these individuals to the role of determining what should be public and what should not be echoed this is particularly complicated because who can possibly read through 1. 2 million documents and make that determination . They pointed themselves. Is not a good idea to have random people to decide to leak large months of data without some kind of oversight. Is he a traitor or hero . Lets say this was a large collection of health care data. A large collection of tax data. Its also in databases that could be impacted in late. You are better off in a democracy having a system which allows whistleblower behavior that does not ultimately cause to beta permanently revoked. Once it has been made available to everyone, you can. People could actually be harmed. More common next. Welcome back. More of my interview with google executive chairman eric schmidt and jared cohen. Schmidt, of all the things google is working on, what is the most important thing . Take a listen. I think the biggest thing that will change is the development of more generalized Artificial Intelligence. Because of the amount of competition that we can now assemble millions of computers to work on your behalf we can begin to transition from you asking questions to making suggestions that are quite relevant to you. The ability to do generalized knowledge means that we can not only discover facts by looking at them up, but figure out the things that you care about. We talk about this in the book. The evolution of this today come on your tablet or phone, you ask a question and you get an answer. He evolution of this is a device that will be this infinitely intelligent personal assistant that travels with you and helps you figure out what you need to do today and what you should know and briefs you ahead of time and make suggestions and keeps you entertained. All of that is possible with todays technology with enough hardware scale. Its a better form of search were i dont have to ask a question . We suggest things that you might be interested in based on the context of what you are doing. This is all often. This is all opt in. You wake up and you are in your and itu determine determines which minute to wake you up. Has the coffeemaker working and so forth. You look at the wall and you say, do i need to get up . The wall looks back at you and says, no. It calculates that you needed the sleep and you get 19 more minutes subject to the rem cycle. Will you use that service . You bet. You want that 19 minutes more. How do i feel about that . People will use that. Google is buying a lot of robot companies. What are you doing with them . We are experiencing with what automation can lead to. Will becomerobots much more presence in our lives. It in a good way. They will help us with this and that. They will replace a lot of repetitive activities that people are tired of doing. Much of manufacturing has been icized. F si est . Ow about nast you are watching bloomberg west where we focus on technology in the future of business. I am emily chang. Has the man behind the coin finally been found . A magazine has concluded that 64yearold wrote the initial bitcoin paperback in 2009 under a pseudonym. He then reportedly created the software that serves as the backbone of a Virtual Currency system. He was a former Defense Industry and government employee. Broadcast Companies Like sinclair and Nexstar Broadcasting Group be forced to give up tv stations under a new proposal from the fcc. The chairman wants to ban some arrangements that allows companies to own more than one tv station in a local broadcast market. Companies would have two years to comply to the change should it be approved. Is Music Streaming Service spotify going public . In the u. S. , the swedenbased company is talking with Goldman Sachs about obtaining a new credit facility, according to people with knowledge of the matter. Spotify has acquired a company that analyzes listening behavior. Yesterday i spoke with google executive chairman eric schmidt and the director of google ideas. More of that conversation now. We talked about mobile and the future of selfdriving cars, as well as the google plan to bring broadband to places around the world. There are more than 1. 1 billion users, and we activate Something Like 1. 5 million a day. That number is growing dramatically. It is a huge life form success. It is free and is extraordinary. You now have a battle between the iphone and the Android Phone , and that fight is producing enormous costsavings and volumesavings. On the cell five and driving cars or the driverassisted cars on the selfdriving cars, it is much more likely that youll be driving the car, but the car will be smarter. It will be a long time before cars are going to be driving around without anybody in them. I have been in a google selfdriving car, and it is an estimate and it is fascinating. Do you have any idea when this could be made mainstream . It depends on the level of bugness. It is important that these cars not have a lot of bugs in them. [laughter] yeah, we are very close. But that last little bit is hard. Speaking of connecting the world, why didnt google team up with facebook for internet. Org . Youre asking an industry question again. I think facebook and google agree on the goals of getting the world wired together. No disagreement on that. Google is working on broadband balloon. Tell me about that. Facebook is reportedly buying a Drone Company which could also bring broadband to earth. But it is this idea of giving people access we have a product called google x which is doing very interesting new development. We invented a technique where you have highaltitude balloons or provide Data Services am a but they are moving in the stratosphere. We have demonstrated this work when we had a number launched. It is important you have permission of the countries when the balloons go over them. That signal has to terminate somewhere. It is in the research stage. What about google fiber . Talking about connecting the United States you have had success and a couple places and challenges elsewhere. Comcast is buying time warner cable. The landscape is changing. Do you see this as being a potential for the business . It seems to me that everybody here would enjoy having that kind of internet connection. Provide it,es not your competitors should provided. Win with increases in bandwidth around the country in the world. It is a very good business, but we benefit when people have very high speed connections. It is in our interest as a company and your interest as a consumer. We went to provo, utah to cover the fiber rollout there. Everybody is very excited, but there are big challenges ahead. How do you overcome those challenges . It is a very established infrastructure. I believe at t is trying to prevent you guys from using their poles in austin. Those are workable problems. The simple answer to regulators is you want to say to a regulator is there a true it for your tra consumer . If the regulator produces only one player, that is probably the wrong approach. Figure out what is preventing a second entrance, whether it is pole attachments or frequency issues. The history of incumbents writing the rules is in favor, and it is important for the competitive market. You look at internet been with globally, it is competitive it is approachable, fast in places where there is either absolute commitment to have highspeed or where there is a competitive mark