Transcripts For BLOOMBERG Bloomberg West 20151022 : vimarsan

I want to dig into the latest numbers. It looks like the spinoff has been a good thing for paypal so far. They are raising their guidance. Joining me live from dell world. You also had a big role at dell world as well. What is your take on some of the numbers . It is impressive. It is interesting, because we are entering this area where we are seeing more and more numbers coming out about online shopping. I just saw a study today about the number of people who will spend online this year is expected to rise by a significant amount. More and more is mobile. Any kind of site that provides that kind of capability is going to be a big deal. The challenge for them is how do you compete against an amazon . It is sort of like the replacement for classifieds. When you think about the role people have a lot of things they need to sell. It is important for them to have a place to sell those things. Ebay is a place to do that. They have brought on a lot of retailers and there are people who do look for alternatives to amazon. There is also a lot of potential growth for them outside the u. S. Emily shares are up 8 in afterhours. What does ebay become without paypal . Is this just an auction site . What is its place in the ecommerce landscape . It is a challenge. It is a great question and there is no easy answer with regard to what they will be able to do. Hopefully, they can carve out a niche for themselves. There is a lot of resale of various items. You can see them offering other types of services and they would expand into other things. That is a possibility down the road. Emily it will be interesting to watch their holiday sales. Thank you so much. As i mentioned earlier today, i got a chance to sit down with michael dell and microsoft and dell are competing more than they ever did before. I talked to two michael dell today about all of the interest dell is going to have to pay as well as his relationship with microsoft. Are they friends or are they for frenemies . Take a listen. Michael the intent is to drive the platform, and we come in with a product that is more affordable, but we can sell 100 times more, great. That works. Emily we are seeing dell make the biggest tech deal in history. Microsoft has done a lot of smaller deals. Why not a bigger deal . Do you think it is too risky . Michael this is the stuff she lives for. Satya that is not the way i think. Emily is it something you would consider . Under what circumstances . Satya we have a very clear vision of what it is we are trying to get down. I want to stay true to that. The biggest bet we have is our organic bet always. Thats true even for michael. On top of that, we will look at any opportunity that fits with where we want to get to. Where is it we can uniquely do . I ask myself each day, i do not want to be in every part of the Tech Industry. I want to be in things where microsoft has a unique contribution to make. That sense of purpose and identity is what makes companies successful, not just doing everything. That is what will drive whatever we do organically. Emily on that note, we have been talking about the unicorns and these valuations which are going up and up and up. What do you see there . Michael there are some Different Things going on. When i. T. Moves just from the realm of making companies more efficient at doing the old things into this digital transformation, it is a game changer for new industries. You see these new companies being created. Are all the valuations making sense, are they all going to work out . Probably not. But there are some fabulous new companies being created. I wouldnt overlook that. Emily say there are 150 unicorns, how many of them are real . Are we in a bubble . Satya both sides of this argument have their point. There is this book that i read, the author has written a fantastic book around the natural Business Cycles of financial cycles that fund technology. It has been true from the Industrial Revolution to today. You have these booms and busts. Nobody wants to be left out during the boom, there is over funding. But the beauty of over funding, lots of ideas get to flourish. Out of that, there will have to be a correction, a bust. But there will be 10 or 15 very successful companies. That is what is great about the american entrepreneurial system. That is what fuels the competitiveness of this country and i think we should celebrate that. Investors have to have caution that you know there is a boom and a bust and the cycles are always going to be true in our economy. Emily where are we now . Satya if i could time that, i would not be sitting here. Emily earlier today. Reddits cofounder is with me here now. You have been doing some panels here in addition to recently going back to reddit fulltime. We are going to talk about that. I want to talk to you about what we just heard. 10 or 15 unicorn surviving out of 150, that is far lower than what i have heard from some of the more skeptical people. What do you make of that . Alexis im an investor in some of those unicorns, full disclosure. I think yes, Business Cycles are a real thing. He is right to have a certain amount of caution. These things are cycles. I really do think that what a lot of these companies are doing is really transformational. We all take for granted the role the internet plays in our lives, and we are only seeing the beginning of the effects. I really think this is what the Industrial Revolution was. This is the internet revolution. Emily private companies and at the same time, we have dell buying emc in the biggest tech deal ever. A company like microsoft trying to transform itself. Are dell and microsoft leaders or are they followers . Are they reacting . Alexis there are only a handful of companies that are doing that kind of amazing, really awesome kind of leader type stuff. You look at a company like facebook. I have lots of issues with facebook, but they are shipping worldclass software, a leader type position. Look, i also say this, at reddit, i think you cannot discount the fact that there are lots of companies that have clearly known what theyre are doing and working at this for a while that will take advantage of the fact that incumbents start losing sight of their focus. The great thing about the free market is that you do not know what to expect. I would not count any company out, even if they arent leaders today. They very well could be in the future. Emily we will be watching. You will be with us the rest of the show. I want to talk about some other things going on in technology today. Slowing growth and rising cost continuing to drive a wave of consolidation in the chip industry with two deals worth nearly 30 billion. Lam research, a 10. 6 billion cash and stock deal. The combined company will have annual sales of 8. 7 billion and will become the secondlargest chip equipment company. That deal was dwarfed by western digitals purchase of sandisk. Western digital is paying close to 19 billion. It is a buyout that gives western access to the market for memory chips. In the last year, we have seen almost 100 billion in deals in the semiconductor sector. Still the calm, my oneonone with michael dell. He tells us why he is never getting into mobile phones and how he feels about carl icahn. As we had to break, i will leave you with one stock on the move today, and that is twitter, sales fell more than 5 today. Morgan stanleys license price target Morgan Stanley its price target. Twitter reports earnings after the bell on the 27th. Elizabeth holmes stepped into the lions then to defend her start up. Elizabeth i read what was written in the article and we think it was misleading and false. I know what we have done, which is the decision to voluntarily work with the agency. We have chosen to take a path that is hard and i believe in it strongly because it is the right thing to do, and i personally worked very hard to change the law in arizona to allow individuals the right to order lab tests directly and i cannot do that without knowing that the tests offered are of the highest quality. Emily she did not pull any punches, calling the journal a tabloid and said the paper failed to provide the proper context for the way theranos measures the effectiveness of the tests. The journal is standing by its story. Questions remain about how real and progressive their technology is. Is leaner really better . Hp finalizes its split, dell is taking on tens of billion dollars of debt to buy emc. That prompted meg whitman to criticize the mega deal. In an interview with me earlier today, dell fired back. Michael hp spent more than 4. 5 billion on dividend and interest expense. If hp were to go private, it would spend 2. 5 billion i am talking about the whole hp as it exists today. Before they split up. It would save 2 billion that it could reinvest in research and development. Her argument is actually ridiculous. I think if one goes and does the math and compares what companies are spending today on share repurchase, interest, and dividends, i feel very comfortable with the decisions we have made an even more so on a taxadjusted basis. Emily will we see dell making mobile phones . Why not . Michael this has been a very difficult sector. One of our competitors got in that space and lets just say there is one company that does really well in mobile phones and a whole bunch of companies that dont. Emily you must be talking about apple. Michael we are not planning to get into the mobile phone business. No plans to do that. Emily you took this Company Private two years ago. Is there one thing you miss about being a Public Company . Michael no. I am sorry, there is nothing i miss about being a Public Company. Emily why not . Michael it is so much easier to operate a private company. I will point to couple of things. We do inside dell with our customers a survey. It is called nps. Our net promoters scores are at the highest they have ever been in our companys history. We also do an Employee Survey across all of our 100,000 team members. It is called tell dell. Those scores are at the highest levels ever in the 15 years we have been doing this. When you line up the investments we are making, innovation, r d, with our leadership and ownership and they are completely aligned and there are no disgruntled activist shareholders telling the company what to do, it is extremely powerful. Our people are very energized. We are growing. We are investing. We are tremendously excited. Emily what do you think of the carl icahns of the world . Michael there is a role to play for activists in investing. I think that anything taken to extreme can be a bad thing. I do not have a particular fondness for mr. Icahn. Emily when you went private, you went to a slimmeddown board. How does the board change . Michael there will be changes as our filings, now. That will be detailed. Emily i mentioned carly fiorina. She is remembered for that deal. Hewlettpackard and compaq. How will we remember michael dell . How will we remember this moment in time . Michael i think this is the second act in what i am pretty excited about as our future. Hopefully, you will come back next year and the year after and we will have some interesting things for you. Emily my interview with michael dell earlier today. Credit cofounder with us at this moment in time, he is trying to pull out the biggest merger in tech history. He is staying in pcs. Other companies are spinning off their pc business. How will we remember dell . Where does it go from here . Alexis we started building read it. We started building it on a dell laptop. It will always have a soft spot for me. Emily a lot of people who had dell laptops do not have them anymore. Alexis he has the ability to try Something Like this and actually make it work. Publicly traded companies have to make those big kinds of acquisitions happen and they rarely go well. But when they do, they can end up being very successful. Michael is not a guy i will bet against. Emily he did tell me that he is all in. We will be watching. We will talk to you a little bit more about reddit after this quick break. Reddit launches its own new site. Is it an attempt to take on content giant buzzfeed . Emily reddit became frontpage news this summer when ellen powell tried to clamp down on harassment. Reddit recently launched its own new site. Back with me is the cofounder, now back at reddit fulltime. I want to start with upvoted. It has only been a couple of weeks. How is it going . Alexis our editor has done a great job. In two weeks we have generated over 900,000 unique visitors to the site. We are well on track for our goals for the first month. We wanted to prove a straightforward thesis. We know that one third of americans love the content and visit it every month. These aggregator sites have really built businesses out of harvesting this content. How can we do that faster and better . Giving credit to the users and adding value. Emily you have jack at twitter trying to reformulate the product, make it more mainstream. 300 million plus users. How do you see yourselves in a world where twitter exists . Alexis both platforms have a role to play. One of the things that i was particularly enamored with was just seeing how when you bring that founder mentality that, you can reinvigorate folks. One of the things that has been so great was just seeing this Company Start growing, doing the things we should have done over the years. Reddit has managed to grow to the 10th biggest site in the country. We hire the most awesome people possible to come help us grow this thing. Im excited to see where it goes. Emily ellen powell made clamping down on harassment a huge priority and it did not work out with her at the helm. They brought back you and steve. I see how that sends a strong message about founder ceos, but what does that say about diversity . The Tech Industry has a harassment problem and a diversity problem. Alexis we are still only 70 or so people. Around this time next year, we will be able to publish our first report and it will be reflective of the kind of site we want to be, the kind of company we want to be. Diverse as the hundreds of millions of people who use it. Emily where do you see reddits place in the social media ecosystem . Alexis wordofmouth is where everybody wants to influence. It is why we buy advertising at the super bowl and do what we need to do to get people talking. In the day, it had to be around the water cooler or around the dinner table. Today, it is reddit. The most genuine realtime discussions are happening on that front page. We want to the best job we can to get as many people as possible joining those discussions. Emily we will be watching. Great to have you on the show. Thank you so much for watching us. We will have a lot of earnings tomorrow, dont miss it. The following is a paid program about humana paid Prescription Drug plans. Welcome to your medicare, your decision, the program that guides you through the Medicare Options available from humana. There are many different medicare choices today. But are you sure you have the right plan, are you with the right company . Do you wonder if you can save money with a different plan