A cyberport from Security Company said hackers are using social networks to make friends with u. S. Lawmakers. , defense contractors and therefore struck a fourstar general and extracting data from them. Its not clear if the iranian government is behind this. Google says its not where it needs to be when it comes to Workplace Diversity as it takes a first look into the makeup of its workforce. Google says that only 30 of its employees are women, 91 of workers are either white or asian, two percent are black, three percent are hispanic. Google says there are lots of reasons why they struggle to recruit and retain women and minorities including the fact that blacks and hispanics get fewer than five percent of Computer Science degrees. Apple makes a bold statement about its Product Pipeline with Senior Vice President eddie cue proclaimed great things to come this year. Jimmyiovine. Year, weve got the best Product Pipeline that ive seen at apple in my 25 years. The best in 25 years . Can you tell us about them . I get to see it tomorrow. I have been writing out this guy for two months. Thats a strong statement. You think for the rest of this year, you have the best Product Pipeline u. S. In 25 years. In 25 years, you did the imac, the ipod, the iphone, the ipad, the macbook those are widely recognized as prettied up products. I agree. I believe certainly the products we got coming our great. The appearance came hours after apple struck a deal to buybeats electronics for 3 billion where apple will gain pop gain access to their headphones and the new streaming music service. Tim cook posted this photo of himself sharing a laugh with eddie cue and iovine and dr. Dre. Thank you so much for joining us. Better than the ipod, the iphone, and the ipad . Do you believe him . You dont hear executive saying anything like this. Look, apple is famous for the reality distortion field. Lets discard those comments. We will believe it when we see it. I can see the eyes rolling. Despite the spin coming consummate position of strength for it that got the cash but its a is a weakness. Using his course of the apple franchise target over the past couple of years, the hot services in music are pandora, spotify, and youtube. Apple has squandered that franchise. By buyingbeats they get the credibility of the founders and the hardware and the beats musics of scripts and service. Music is what brought apple back. The ipod is what brought back apple and the ipod on windows is when the growth accelerated. This really shows apple trying to fix a problem theyve got with their old business, not develop a new business. The comments about the Product Pipeline which got everyone they could not invent anything near an ipod or the imac which was the first steve jobs returns product. The ipod, the iphone what could possibly be close to that . Its hard to imagine. Many people were talking about Cloud Services as a way that they screwed this up. As is looking in the rearview mirror. Many people out there criticizing thisbeats deal. They dont think its innovative or the right thing. They think its expensive but beats as an android app. It has a Windows Mobile app and apple has had a limiting orthodoxy of developing just for ios. Having beats and allowing it to have a to develop as a second brand allows them to follow consumers and how they use devices. A lot of skepticism here. Do you agree . I think its easy to be skeptical. There is no question that apple is doing the deal because its a reaction to downloads and the rise of ondemand streaming. Lets not forget that beats is generating 1. 5 billion in revenues. The price tag for the deal came down at 2. 6 billion of cash. It, it is ak at Good Business and its easy to reject it but its a good strong business. Lets not also forget that withbeats, they are getting an established brand that has a cool cachet with the kids. Is importantg that in this world of ondemand streaming is there has been an artist backlash to overall economics of the streaming services. With the beats deal, with jimmy dre coming into the deal, it signifies to the artist minute it a matter. You can make a lot of friends with 3 billion. I agree to that sort of but 1. 2 billion in revenue i wonder what the margins are on the headphones, 10 . I think the margins are actually pretty good. Beats is getting into the automobile market. When you look at the deal, it is extending apples brand into areas where wants to be including wearables. Im not necessarily justifying the price but its easier there is some real logic behind this that is easy to overlook. There is item after item of wyatt does make sense for apple. What about the cultural differences . You can see the difference between the personality of eddie cue and jimmy iovine. At one point he said he did not say anything because he works at apple but he is largerthanlife and outspoken. Hes not your typical buttoned up apple executive. I think apple needed it. Content right now is what is selling hardware. The apple tv the ipod touch you need the content Community Apps and apple has had a limited orthodoxy. Centricad a download model and Consumers Want to get content in different ways. Bneats brings that to apple. You dont think there will be a culture clash . If dr. Dre keeps making those videos, there might be. They are culturally less to similar than you may think. Steve jobs was very much considered to be an artist by manning. Arty many so they approach and a different way. You the marriage of artistry with technology. I think this is an exciting deal to signify this convergence of technology with great content and ultimately content drives take great technology. This deal is seminal for apple in another way. The biggest of before this is when they bought next for formally and dollars. Apple was proud of that. They would never do a deal that was that your than the next deal. Archer from the old orthodoxy and it shows that apple is willing to take bets to complement its product and services in areas where it is weak. It is important step the company. The cash the still costs, it generated from the time the news leaked. The cash creation at apple is massive. Thank you so much to all of you. Google is kicking itself driving car into high gear and we will hear from two of the people in charge of that project next. Bloombergback to west. Google is moving at full speed on its self driving our project. It will build more than 100 prototypes of the cell driving car complete with no breaks, Steering Wheel or gas pedal. Production will begin late this summer. The creators were on with charlie rose to talk about the challenges of getting these cars on the road. We have had our vehicles on the road and we dont about 700,000 miles of driving. We have gathered that data and how we can use that data to have to learn what people look like when they change elaine and learn where the cyclist is about to move in these kind of predictions are what the human brain does constantly and this is what the vehicles have to do. In artificial intelligence, thats a long road. How does it distinguish between what might be person versus an animal . Thats great. We look at the shape of the object. We look at how its moving. There is a lot of these different very complicated feature vectors that the engineers designed and then we throw a whole bunch of data at this machine and it figures out that this collection of features mean thats means thats a personal thats a tree or thats a car. When its wrong, what do you do . It has to be robust to be wrong. It will be conservative. One thing we program it to our vehicles is to be a defensive driver. That means it is living extra space. It is aware of blind spots on the vehicle. So it allows it to have a margin to deal with situations where it might miss classify things. What worries you most . Your experience has been in safety. For me, its making sure that we do everything we can to do the testing necessary to prove to ourselves and there is commitment at google to do that. Just making sure that adequate testing is done google is already tested 700,000 miles autonomously now and all that data has been collected and we are able to use that to simulate scenarios and keep adding to our scenario database. We are in a strong position to make sure we have it right. The former head of the operation was here and he set an interesting thing put too much intelligence in a car and becomes creative. To much that means with information inside, it begins to take chances . Im not sure exactly what he meant by that. We do use a lot of Machine Learning but we do that offline. And we have this amazing system that allows us to review where the car has driven in the past and how it reacted and then how it would react given whatever new thing it has learned. We can predict a lot of the behavior of the vehicle. It still needs to be generalized. You will not see the same cyclist at exactly the same place every time. You learn enough and get enough confidence that will behave the way you would want to. The car cannot detect a driver trying to get into a lame lane or merge. It cannot understand the language of urban traffic, true . Thats fair but whats interesting we learned this early in the project there is a lot of myth around this. That you have to make eye contact. It turns out that you can send a lot of a message with how you position the vehicle. Once your car starts moving forward, that signals to the other people around you that you will go. We have been thinking about how to do that in a safeway that allows other folks to get that the car is moving. How important is what google has done for mapping to this whole process . I think it is vital and distinguishes what it is doing from all the other companies. This map allows a company to know exactly where it is in the world at all times and know what to expect as a nose with on that map help to figure out a lot of the difficult issues and the environment is operating in. But it has to be far more precise than what google maps does today . Yes, its more precise. The features and the geometry and the detail are necessary in order to know all the things youre looking for to drive safely on the road. You can catch that full interview tonight at 8 00 and 10 00 on Bloomberg Television on charlie rose. Over 2000 social media accounts of government officials may have been compromised by an iranian Hacking Network. We will look at the social media Cyber Espionage campaign when we return. Welcome back to bloomberg west. How can tweets and tags and timelines become fodder for Cyber Espionage . Report, ano a iranian Hacking Network has been stalking strategic government targets for the last three years using social media platforms like facebook and linkedin. These hackers created a Fake News Organization on their website, news on air. Org and connected fake journalist to target defense contractors and military officials. Cory johnson is back with me and joining from washington, d. C. Is Michael Riley who wrote the story. How did they do it and how do we know theyre from iran . It is a pretty clever operation. Stood up a virtual Media Organization and created a bunch of journalistic personalities online to go along with it. They would fill the webpage of this Media Organization every day with articles that effectively listed laces like reuters and other mainstream Media Organizations and was put under the name of these fake journalists and then they would have this corps of journalists use their persona to get close to u. S. Lawmakers and military officers and defense contractors and others over a long. Of time until they got to the point where they trusted them enough to click on a link that would download Malicious Software and still credentials and get access to emails. It was a pretty clever operation. We know they are from iran becausethey worked on the iranian were scheduled . There were certain close . Clues . Theres a lot of evidence that points back to iran, the iip addresses are based in iran. They used iranian words as passwords, the hackers and things like if you chart the activity of the hackers, its imprecisely with typical iranian work week even to the weekend were they took off starting thursday afternoon and started again on saturday. Its a very professional organization. Whatmossad would do if they were behind us . You can always make it look like somebody else. You can do it in ways that is hard to detect. In this case, a lot of the targets were israeli and or israeli officials. You can always fake this kind of stuff but it looks like emma from a combination of targets and all the other clues, he gets at it back it gets back to iran. On some level, this has to be hypothetical if you cant tell who was at the keyboard. My friend who wrote mystery novels wrote a book about a cia agent in afghanistan that goes undercover and does this same technique. Is social media the weak link in spy networks . Of the things that this campaign shows is if youve got enough resources and patience and time, the vulnerabilities created by social media are pretty large. One thing they did is by creating a persona, they gave them a lot of interesting back stories and created an owner for this news organization, the journalists interacted with the owner, and they began to friend people around the targets. Over time, it created a trust where it made it easier to get people who would otherwise be trained not to click on these links to click on them. If you get a video from someone who you friended with and have been interacting with on facebook for months or maybe longer, thats a pretty hard thing to avoid. You say this indicates that perhaps the iranians and the government there may be escalating their hacking efforts to the level of china . They would put that much resources behind it . Certainly, the shows that they are really trying to play on some level with the big boys. The u. S. , china, russia put a lot of money and effort into this. Iran has clearly been trying to up its game in terms of ciber as been eisen being able to do more destructive attacks. This may be the biggest piece of evidence we have so far that they are actually getting close to doing the kinds of largescale campaigns that some of the larger countries do. Michael riley, thanks so much. The sale of the l. A. Clippers could fetch 2 billion but are they worth it . We ask the owner of the clippers biggest rival next on bloomberg west. By six percent of the blumer television is on the markets the indexes are up for the fifth and sixth day. Individual movers for you solar city says it will offer solar installation discounts by a coupon site groupon in order to get massmarket adoption. The shares are up 4. 7 . You are watching bloomberg west. The sale of the Los Angeles Clippers is drawing interest from the likes of former microsoft ceo Steve Ballmer and former nba allstar grant hill. With a price tag that could be 2 billion, what do owners have to do due to see a return on their investment . Jon erlichman has more from l. A. Amazing thatty this clippers story has put valuations front and center and San Francisco, the fact that the Golden State Warriors are building a stateoftheart facility, another reminder of how big is businesses. Of Mandalay Entertainment Group a group that acquired the wires back in 2010 for 450 million which many people say would be worth now is with me. Lets start with the building of this facility. What goes into a project like that . What are some of the challenges . A lot of golden a lot of drama and a lot of suspense and a lot of planning and its always a long and arduous and somewhat uncertain journey. You try to create certainty by doing it correctly and you engage with the community and engage with the people who are the architects and the people financing it. There is a lot of constituencies that have to land. Its like having 12 bulgarian jugglers perfectly aligned. No doubt, speaking of the community, its a large tech community, you have talked about building the Madison Square garden of the west. You want this also to be a very tech savvy facility. Have you spoken to Companies Like apple or google about ways their technology can be integrated into the facility . We have to have a click and mortar strategy. We have to be digitally fit. We have to create a venue and the platform that allows people to interact and participate in the experience of the game and the arena and the site. Their participation is what generates the enthusiasm and ultimately the money. Not speaking to the people in Silicon Valley and in San Francisco who are the leaders in this market, who know how to engage audiences and no how to interact and create that environment, would be insane. We will draw upon that heavily and have been drawing upon that. This Los Angeles Clippers story has raised so much attention to team value. There are reports that there could be offers on the table north of 2 billion. Do you think the Los Angeles Clippers are worth it . Things are worth what people are willing to pay for it. The people bidding on that team are all extremely successful, extremely smart, and they did not get there by accident. They will measure of value in what they pay for it and what they think they can add to it. There are valuations of life, locationbased entertainment which is even to an spectacular and thats very valuable in this age. Its something you cannot imitate easily. You cannot just dvr, you have to be with it. That gives a very vital value to that asset. We own the dick clark company. We have a Live EntertainmentCompany Great we own sports te