Defining. Chicago, atlanta, newark, jfk and washington dulles. Kleenex and huggies makers cutting up to 1300 jobs. Forecast toullyear reflect costs associated with the spinoff of its health care business. In emerging markets has been a strong point. Cocacola shares are falling the most in six years today. It down more than 6 after the Company Reported sales that fell slightly in the quarter to just under 12 billion. They announced a costcutting aboutnd mounting concerns the Health Dangers of soft drinks in the United States. Deutsche telekoms has teamed the company says it is looking at options for tmobile. A future where tmobile remains independent. But sprint and iliad dropped plans in recent months. Staggeringlling a number of iphones. The smartphone brought in 56 of revenue. The success of the device begging the question, is apple turning into just a phone company . Our marketurn to makers anchor Stephanie Ruhle who has been at the robin hood conference. J cruz at ceo. Withd exclusive sitdown the founder of formation. You just left the stage. You and eric schmitt, two leading minds in the tech world. What was your biggest take away . I have always tried to look up to eric schmidt. Similarto do something to what google did. Its extraordinary to see how he can take that culture and build what he has built. A lot of our friends right now compound from google. Our building is an intersection of old industries. Isnt there an argument to be made the idea of disruption is great. Unless you truly knew the product, is there a bubble . Is Silicon Valley trying to disrupt businesses they dont understand . s people from the outside that come and change it. Building government technology, but we had lessons from companies on how to apply you come in and you figure it out. You have said before that what Silicon Valley can do is solve some of the problems businesses face. The way they are running these industries is not very smart. Like what . Health insurance, for example. There are tens of thousands of people using fax machines. 300,000 people still entering data manually. Its not how the industry should work. It is hard to build a technology culture. Is the mobile payment business getting crowded . Do you feel like theres too many . I agree with you on that. Paypal and i was working for him, everyone knew the Payment Company i have seen thousands of payments companies. There are too many good is there a company right now you are most excited about . The Second Company we built. Doing a Wealth Management platform. A lot of interesting technologies applied to finance we have not seen yet. Whether its Corporate America or the u. S. Government, we are prepared for cyberattacks . We really are not. Theres a lot of new technology coming out thats changing how we see security. A Company Named of the meals launched today. Illumios. What is fundraising like in Silicon Valley right now . Is the money falling from the sky . Theres a lot of lessons from the last 15 years. If you are going to one of the top funds, they are going to be skeptical of most things. Have laterwhen you Stage Companies that people think are hot, people in new york a pretty eager to give the money and that is dangerous. Involved now that joe green is out without zuckerberg, what does the future hold . Zuckerberg is still backing it. The immigration issue is so important. Of our bestg one engineers because his wife lost her work visa. Politicians on both sides want to fix this. This room isn panicked over market volatility. The screens go read last week did that matter to you and your community . You have to be aware of it whiche there is a truth is the call before the storm. Absolutely great having you here. So many wondered why there is a Silicon Valley guy. They should listen to joe. He surely knows what he is talking about. Thank you so much. Stephanie ruhle from the robin hood conference in manhattan. Is apple to dependent on the iphone . The phone is making up more and more of the companys revenue. Im emily chang and this is bloomberg west. Has the dominance of the iphone turned apple into simply a phone company . Apple sold over 39 million iphones in the third quarter. That includes just one week of the new iphone sales. Tim cook called the demand staggering as the Company Forecast record holiday sales driven largely by the iphone 6. Is apple getting too reliant on the iphone which made up 56 of revenue for the quarter . Consider it is the secondlargest product category in the quarter. The first was the mac, which made up just 16 of sales. Cory johnson with me now here in the studio. The phone numbers are staggeringly great. Is there a flipside . We could have done a whole show today on apple. A fascinating quarter. Has long beenich the product apple sells the most of is now well over half of their business. You see how much the iphone dominated apples overall business with 56 of the revenues in the last fiscal year. Moment a donuh , but it points out how important this singular product has become for this company. Two important . We saw the iphone 6 beginning of the guidance for the fourth quarter. What is next . Some people are saying are they ever going to grow from right now . There is talk about apple creating an ecosystem of products. If the phone is becoming so dominant and that is the only product i really need, does that theory makes sense . How close is that ecosystem . Pay the Services Like apple draw people across the product category . When you look at how this stacks up to the ipad which had been the secondbest selling thing in their product line, the number thephones sold compared to number of ipads pales in comparison. Apple has now rolled out apple pay. Allowing users to make transactions at participating retailers with this type of iphone. The system is already place at 220,000 stores. Olivia sterns when out on the streets of new york to find out. Apple says my new iphone 6 is going to completely replace my wallet. I have decided to put apple pay to the test. Lets see how much shopping i can get done. My first up, the disney store. Perfect. Thank you. The disney store was easy. One touch and i got all of these. That doesnt mean i dont need a handbag. I think we have a winner. That took a bit longer than i expected. Apple pay did not work. It did work when i read my card as a credit card. Either way, i did not have t o sin. Have to sign. A 35 ostrich egg. Heres the deal, apple pay worked very well. So smoothly its a bit anticlement kick. Anticlimactic. Some things like the ostrich egg and that went very smoothly. Apple pay does save transaction time. For people like whole foods, anything you can do to move customers more quickly is going to mean a lot or business. After allore stop this shopping, my feet are killing me. I have to get some aspirin. That is everything. Im out of money and out of time. I have to get home. For that, im going to uber. Do you take apple pay . I have no idea. No . At least uber already has my credit card. Sterns, apple pay is out. I want to handbag. The reviews are in. How did apple pay go on day one for Apple Partners . You guys are a partner with apple pay. What are the numbers so far . Its too early to say. We are really excited. A good step for you was on the day. The newmes more people customers getting cards. Is this a new business where are trying to get people lets say i have a chase credit card and a wells fargo credit card. Is this a chance for you to win share with customers . What it allows us to do is help them use it in a mobile way. Can you move the card from the back of the wallet to the front of the wallet . I dont think its a singular option. Its more of a holistic option. A consumers my digital experience with chase is better and we can give them different offers and the experience is we recently rolled out our chase mobile app. Centric. Digitally 40 of our customers log into their mobile app once a quarter. Helping me work in a digital world. Getting any arent data out of this transaction because thats how apple has structured it. To use, its simply one click and i can buy something with apple pay. I wonder if it could boost ecommerce and boost the number of transactions we are seeing because consumers dont risk the abandonment. Thats an excellent point. One is the point of sale, which we just saw. Its almost anticlimactic. Buyingpt transaction, stuff using an app on your iphone. It is really simple. It pops up with your credit card of choice and shipping and billing information and you are done. Bettert people to than any other experience. What are the friction points that might be different . I cant talk about what our creditors do st talk about the crummy iie one. When you put your card in, its really simple. As opposed to having to go through multiple steps. Getting verified and calling call centers. There is email verification. Some banks have more steps than jpmorgan. Some have different steps. Sure our digital platform is simple. Have you had any conversations with google . About what welk are talking about with different workers. There is interest in the market about tokenization. People are excited about the services we offer. And helps remove the credit card out of the consumer device. Use the tokenization system that is being used by apple pay today. One of the problems ive had with my chase credit card i have had problem with security and ive had my credit card over stolen and used multiple times. Do you think this will help with that . Im sorry that happened to you. Chase is constantly looking at monitoring all the different fraud systems. If we see anything unusual, we let you know and you can call us anytime and we will be more than happy to take care of anything fraudulent. Will tokenization help . We think it will. A single payment code is used for each transaction. Somebody goes to intercepted, that number will become useless after one transaction. Expect are you certain that fraud levels will go down . It is too early to say. We are really excited. It looks really good. It just happened today, so. Thank you so much for joining us. Executive director at chase. Well test less sales be banned in the home of the u. S. Auto industry tesla sales be banned in the home of the u. S. Auto industry . Welcome back to bloomberg west. Michigan Governor Rick Snyder has until today to either sign or veto a bill banning the direct sale of tesla vehicles in the state. Tesla has reached out with michigan suppliers rallying them against the bill. We might even have dealerships. Its not something we need to do right now because we are selling a medium volume car. We dont need car lots. If michigan decides to ban the tesla sales, it would follow the lead of other states like texas, new jersey, arizona. Sales are being challenged North Carolina and massachusetts. Qualcomm, teaming up for a Virtual Reality startup. A streaming on your phone, tablet and bloomberg. Com. It is 26 minutes past the hour. Bloomberg tv is on the markets. We do have a rally going on. The s p 500 still up about 1. 4 on the strength of the earnings reports. About individual never spirit Harley Davidson reporting thirdquarter earnings that beat analyst estimates. Shares rising by the most in almost two years. A chipotle better than estimated thirdquarter results. The company says the growth is going slow and the shares are down. Youre watching bloomberg west. Im emily chang. Augmented reality can make wales fly and elephant fit into the palm of your hand. The secret of startups is working with google and qualcomm , raising 542 million. Obviousvestors include centers. It will commercialize its mobile wearable system. What could it be working on and why are tech giants wanting to be a part of it . The codirector of the augmented Reality Center at miami university. Leapsu seen Magic Technology . Ive seen their vision. I hope they can deliver what they are promising. It looks fantastic. Has half a Million Dollars half 1 billion worth of stake in it. What do you make of the interest in this company . , usermented reality interfaces are going to be huge if someone can finally deliver a system that is usable. Isgle believes magic leap going to succeed at that. I think qualcomm investing is a great sign. They have been one of the main benefactors and one of the main suppliers of augmented Reality Technology for several years. Magic leaps technology differ from Something Like oculus . Magic leap clearly wants to give you a wearable that can go out into the world. Meant to be cheap, everyone can have it in their home connected to their game machine. Magic leap is about going out into the world. Some lightweight wearable that will let you experience have experiences in your everyday life. Glass, itgoogle projects the image directly onto your i. What are the applications of that . Be able to going to make the device a lot smaller and a lot lighter. This has always been the direction the technology was going to involve. Google glass was a nice first step. You can look around and see people wearing them a year ago are not wearing them anymore. The packaging and the usefulness of it was not sufficient. Magic leap is looking to make that step. They like to call it cinematic reality. What is the real difference . Its a bit of a cynical answer. When i say augmented reality to someone, no one knows what that means. Cinematic reality gives a much better, intuitive feeling about the kind of experiences they are trying to design. I love their video with the submarine in the sky. Communicates their vision better. What are the future possible applications of this . Is this purely for entertainment . It reminds me of something id see on game of thrones. It is definitely not going to be just for entertainment. A set ofrking on technologies, enhancements for people that have vision deficiencies. People are working on augmented reality applications for teaching people how to do tasks like repair a vehicle or repair a reactor core. Those kinds of technology designs have been worked on for a while. What we lack is a nice platform to deploy them. Magic leap has some interesting open positions for people with phds in optics. Abouto those jobs reveal what they are working on or their approach to it . That theylls me really think they are going to need some custom hardware, custom optics. They are hiring someone who has experience making highperformance graphics cards, people makingd custom circuits. They are working on some kind of wearable that will have custom optics and some sort of laser technology. It will have custom integrated circuits. It sounds like they are in the process of building a whole bunch of highperformance Specialized Technology to make this work. They wont be able to take off the shelf parts. When facebook bought oculus for 2 billion, there were a lot of skeptics out there. In terms of the future of cinematic reality, how ubiquitous the uc this kind of seeity coming do you this kind of reality coming into our lives . Will it be something occasional . Think it is quite possible that everyone will have one. Whether we wear it every minute of every day, i would not expect that. I would expect it to be as or an as a game boy tablet. Itsng to give you going to open up possibilities you wont have any other way and it will open up possible applications in entertainment. Its a question of making the Technology Work and getting the price down. People are going to want this. What kind of research are you working on . What work remains to be done from your perspective . I think the biggest part of the work is, once you have this technology platform, what are the great uses for it . We remember how terrible webpages where when the web first came out. We are going through that same period. A lot of what my Research Group focuses on is trying to develop that areons fo useful to people. Anave a student presenting assistive device for people who are colorblind. We have a prototype we are working on that will allow First Responders to see around corners in a building. We send in a fleet of camera heads and the person has a mounted display that lets them look around and explore the environment without having to physically walk through it. We will see a ton of applications. Your target figure out which ones make sense and which ones dont. Fascinating stuff. Thank you so much. We will continue to watch how this field develops. Up next, what happens when you combine technology with wall street finance . Product looking to disrupt the brokerage business. Im emily chang and this is bloomberg west. Your investor strategy might be good. Betterment could make it even better. Disrupting theis brokerage business. The companys straightforward investment approach driven by technology to deliver results. Of newlooks in part two hack city. Ed kitchen, old and seemed meeting spaces. People say it looks more like a second grade reading room. Im ok with that. At the new york headquarters, Silicon Valley culture meets with wall street finance. Cap the company has a tech background. Half the company has a tech background. The startup is trying to rewrite the rules of investing with userfriendly technology. Compared way 1 fee that some traditional Money Managers charge, betterment clients pay zer 0. 15 . We use a Smart Technology to automate a part of your life. The founder and ceo quit his job at Financial Services and launched betterment in 2010. I built this product for me and my peers. On client investment goals, betterment uses software and algorithms to manage their money. We do things like balancing, dividend management. All better than you could do on your own. You get a better return on your money and less time and more peace of mind. Disrupting the brokerage business isnt easy. But betterment is expanding rapidly. Company manages nearly a billion dollars in assets and it to grow four times per year. Itno one else has reinvented from bottom to top. It all