The city is home to the alberta oil stand, the thirdlargest reserve behind saudi arabia and venezuela. The Environmental Protection agency is accused of being almost 30 years late in issuing rules for the handling of wastewater from oil and gas expiration. Environmental groups are suing the agency and seeking a court order compelling the epa to adopt measures regulating the disposal. The Transportation Security Agency is adding more screeners and bomb sniffing dogs to congested airport hubs. Securityestimates of this summer. Global news 24 hours a day, powered by the 2400 journals and 150 news bureaus around the world. I am mark crumpton. Emily this is bloomberg west. I am emily change. Chang. Coming up, investors shift tesla shares in the high gear. Expectedr than loss. Two top executives leave. We will break it all down. The beats go on. At apple the tech giant changing the tune of its music with a remix of its user interface. We have a deep dive later this hour. Tivos second coming. The pioneer that became a victim of its own success is back in the game after a 1 billion acquisition by robi. Whats in store for the second act . I will speak to both ceos ahead. Tesla shares popping in afterhours trading after the company reaffirmed plans to deliver 80,000 to 90,000 cars this year. Tesla beating estimates with an excited loss of . 57 per share in the First Quarter and it is adjusted Gross Margins of 21. 7 . The news comes hours after two top executives said they are leaving the company. Here to discuss in more details is true cars vp eric lyman and our niedermayer. I will start with delivery. Tesla says yes, we can make these deliveries this year but there seems to be a lot of skepticism around whether or not they can actually meet this delivery target. What is your take . Well, yeah, there are definitely some times that there may be some issues with making deliveries. Sales last month did not look particularly good according to what ive seen. It seems like it is always a question of is a demandside . Is the model x a dud . Is it tapped out . As usual, tesla is saying production has a sleeping bag in the Conference Room off the assembly line. A lot of this gets back to production. Emily it sounds like typical. Elon. Eric, would you reiterate what ed just said . It,ou could put money on do you think they could deliver that many this year . Eric i think they could. They have had a rash of some setbacks. There are lots there is lots of chatter online about the build quality of the vehicle. Obviously, they had an 18 month delay with the model x. It has not been a clean launch by any stretch for tesla with the model x. Emily ed, lets talk about overall numbers. Deliveries aside, what are your big takeaways . Ed i think it will be a huge challenge for them to deliver. They are looking now at potentially 100,000 to 200,000 orders here in the second half of 2017, which is just a huge aspirational target r elon musk. And you have got that while you have the head of manufacturing and production leaving the company. It seems interesting timing, right when they need some expert s to understand the manufacturing and production process for tesla the most. They will be absent with this ambitious goal coming on the horizon very quickly. Emily one of their highest paid executives, as well. How big of a loss is this . It is massive. They are accelerating for model 3. I think there is already skepticism about whether or not they can get that out on the previous timeline as they never really met those timeline targets before. Another accelerating on the same day that they lose two top vps for production, elon musk was just on the call talking about how they have some announcements lined up about who might be stepping into these production and manufacturing jobs. They say all these things and have this ability. But they keep losing all their talent. And their salaries are some of the lowest in the car business for the same positions. Its definitely a huge risk. But plugging one person and to replace another, you can do all kinds of things with that. The history of the industry proves is that it is culture. That drives Quality Manufacturing toyota has proven that. Tesla still has not shown it can really develop a longterm focused culture that makes these improvement. We see this backandforth and people coming and people going. Emily what about the model 3. Does it seem like they will be able to stick to that price of 35,000 . I think they have to at this point. What i have heard is that some of the orders, the majority of the orders on the reservations online are coming in well above 40,000 or 45,000. Whether or not they transacted a lower price we saw a similar phenomenon with the model s. People were really upping their purchase into a higherpriced class, which is a great opportunity for tesla to present price that at one at a different price. They are certainly committed to that 35,000 price. Emily what about the powerball, the tesla battery, and were starting to see the first reaching customers . What are the reviews so far . To be honest, i focus on the automotive side, so i really dont have i have not read a lot of reviews. I am sure they are hoping that will provide enough volume to get the gigafactory running. Its a huge plant. They have to get the production of a model 3 up to meet that production they will be doing. If the demand is good for these power walls, that will help a lot. The problem is there is a lot of competition. Its a commodity business. Toy are certainly not going margin out of this power walls. Unless they are really blowing people away, which i have not seen, its hard to get too enthused about a Stationary Battery as a product. Im not confident it can do it it to do forneed them. Emily ive never heard of a battery plug anyone away, but an interesting point. Ed niedermayer, thanks so much for joining us. Staying on earnings, shares in zynga are surging after the Gaming Company posted firstquarter results that Beat Estimates. They said Consumer Spending on games rose 8 from a year ago. This is the First Quarterly report under the new ceo who replaced founder mark pincus. He was brought into excel innovation. The company says he shares a common vision on the direction of social gaming. Tears were down about 14 before wednesdays close. Coming up, fitbit out with earnings, and shares are plunging in extended training. Earnings guidance on per share. What does the company need to show investors . Emily and the oneyearold streaming service, apple music. Can a makeover help apple reclaim its dominance in music . That story later in the hour. Emily now to ellen pao. It was launching a new initiative called project include with other Silicon Valley women. In my conversation yesterday, she told me some companies have already expressed interest in the project. She is working on a book that will chronicle her experiences in Silicon Valley. Conversation, i asked her about Michael Morris at Sequoia Capital who once told me the firm would focus on hiring women but he would not lower the firms standards to do so. Later on he clarified and said there are many qualified women and they are working hard to find them. Listen to paos reaction. To his comments. Ellen it is hard for people to change. There is a system that works well for them, and they dont have the ability to think outside the system. For us, what we are trying to do is bring in all these different views. We have eight women that have not phenomenal things, each a tremendous leader in tech. These are recommendations. You can not think about them and continue to live in your world, or you can open up and really hear other peoples ideas and think about what are you missing by having the static system . Emily that was my exclusive interview with a former junior partner at Kleiner Perkins and interim ceo at reddit. You can check out the full interview at bloomberg. Com. Fitbit shares are sliding after hours as the Company Issues weaker Second Quarter guidance. The company reporting a firstquarter revenue of 505 million, beating wall street estimates and profit of under 11 million. Their first year as a Public Company has been rocky and the stock is down over 14 since its june ipo. What will it take for the company to prove itself to investors . Joining me from boston is ramon lomas, first of all, what you make of this miss . Ramon i think it is a pretty big miss but we are looking at this moment in time. They key Going Forward is fitbit is not the kind of company that will stay still. We have a lot more development and a lot more product and a lot of other experience to look at right now. If we can just be patient and say lets look at how the run that develops, i think we will see a lot more than what we see here today. Emily lets talk about their new activity trackers. Alta and the blade. How well are the new trackers doing . Ramon if you look at the counts they made, altogether for all the devices, they sold about 5 Million Units. Alta for about 1 million and blade for another million. Aside from them just being devices, take a look at what fitbit is doing. They are bringing out devices you can actually wear when you are working out and waited you were going to be out on the town. You dont always have to look like youre going to the gym. Look at these two devices and keep in mind these are not launches from the start of the quarter. They were staggered out. To have one Million Units in less than 90 days, i would consider that rather successful. There are other companies that would like to duplicate a kind of success as well. Emily from your perspective how good are they doing against the apple watch . By some estimates fitbit already has more than 60 of the wearable consumer market. Ramon we are looking at two different kind of companies here. If you look at just fitbit, a very tight focus on health and fitness. That is been their dna from the very start. They tell you how many steps you take, calories burned, sleep at night. That is what they are focusing on. Apple with the watch is trying to be many things, all things to all people. Communications device, a place to play applications, games, social networking, communicate backandforth. A lot of people look at the device and say do i really need this right now . I still have this great smartphone in my pocket. The walk as a whole, a lot of people are trying to figure out what can it do that says to me i really need this . So to have these two companies butting heads, i dont think that the right way to look at it. I think there is still space in the market. There is a very nascent market that really started coming up a couple of years ago. There is a lot of space to grow. For fitbit, its been around for several years and they are developing and doing rather well at that. Apple, this is a firstgeneration device. We have to take it warts and all and theres some terrific things about it. Come 2018 or 2019, we will look back and say the number one fitness trackers looked like back then . Quaint. Oked really emily we spoke with james park a few month ago and heres what he is able to longerterm vision. James the longterm plan for fitbit is we are not just a wearable company, we are Additional Health company. We are helping people achieve their goals. Work with stress. Wearables. To help people address those goals emily ramon, how successful do you think fitbit can be as a digital Wellness Company and selling a broader range of services . Ramon i think that is where the market as a whole is going to go. We have got to start thinking about wearables as a device you slap onto your wrist. Eventually it will be targeting Everything Else in your house. With fitbit the arty have wifi enabled one they can talk to you, whether you like it or not. Consider this. If you had your fitbit or whatever other device and it talked to your refrigerator or your hvac, more about how you been doing since your last appointment, there is golden that. If fitbit will be a will to realize this kind of vision, it will require a lot of software. It will require the hardware, and he have to build the network out to talk to all these devices and people and systems. Its entirely holistic so the by the time you put it on at the start of the day, not only are you going to see what youve been up to, but all this data is being shared to all these devices and systems. Think a much better life can be if you have a kind of information. Emily ramon, we will have to leave it there. Ramon, thank you so much for joining us. Up next, a match made in tv heaven. Robi and tivo prepare for a monumental shakeup. We will hear from the ceos of both companies next. Emily youtube could be coming up with its own pace of Fiction Services for a bundle of tv channels by early next year. The project is called unplugged. Its one of the biggest priorities right now and it has been developing since 2012. Executives have discussed the plans with most major media companies. Including viacom and cbs. They are said to be any for a package price of less than 35 a month. A subscription would complement what is already the largest ad supported video site in the world. Now, staying in new media rovi and tivo are taking on the industry that is changing faster the Convention House of cards. Last week rovi agreed to buy tivo in a deal valued just over 1 billion. Its at a time when they maybe more important than ever. Joining us now to discuss the deal is the rovi ceo tom carson , who will lead the new company, and tivo interim ceo naveen chopra. Tivo is known for dvring. Rovi is the guide that tells us what is on. What is this combined Company Going to be known for . What is your focus . Tom, we will start with you. Tom thank you for having me on. We just came back from a meeting. Excitement is incredibly high. The combined companies have an incredible arsenal of technologies for allowing consumers to get to the content they want. So for us this was all about the product side of the business and helping us formulate a company that is just better from a product perspective than either ourself. Can be by emily tivo has seen the march of technology in this space for now a couple of decades. The sec may be opening up the settop box market to more competition. How would it affect you guys if google gets into the market, if amazon, apple push even further into the settop box market . Its kind of all speaking to a lot of the rationale behind tivo and rovi coming together. The world of television has changed phenomenally of the last two or three years. As you pointed out. A lot of new players coming in, Consumer Behavior has changed substantially. We see this as an opportunity to take what tivo has done, which many view as the best way to watch television and the gold standard, and bring it together with a lot of these smart plumbing that rovi provides the that help make all possible. To the extent that the sec is able to create more opportunity for opportunity in that arena. We think the combination of these two companies positions us even more strongly to play with a lot of very large Silicon Valley companies being a part of that, as well. Emily right, so you guys have a powerful portfolio combined. We have seen these companies in litigation with the likes of comcast, netflix, google over patent licensing issues. Are we going to see more of that . Tom this deal was really not about acquiring additional intellectual property. Sometimes rovi gets a reputation for being more of a patent bully. And frankly, the reality is we work very hard with our prospective licensees to come to an agreement that is fair in and mutually agreeable. Less than 2 of the agreements we have actually end up coming from a litigation. So the vast majority of the license agreements are done amicably. So this is really again this is about the product business. Earlier, this is a great team of two companies that really do in their respective areas have great product technologies that want to combine to twice the size. Emily some of these guys are developing their own ip for tv channel guides as well. Do you have ip that they need . Tom i think the way to think is someone doing a search for video content in whatever way, shape or form they are doing it has a high probability of needing a license under the rovi patents. Even in cases where we have a agreements with our discussions with prospective licensees, what we find is that they have a very high interest in a lot of the product technologies because the Product Technology we have between the two Companies Really is the best of the breed. It allows the dynamic of the discussion to be not just on an intellectual property but on cutting Edge Technologies that they might need for their own products. Emily we will be watching the future of settop boxes as a rapidly evolves. Rovi ceo tom carson and tivo ceo naveen chopra, thank you so much. Coming up, a year later apple music has not gone platinum. Details on their plan, next, and if you like bloomberg news, check us out on the radio. You can listen on the Bloomberg Radio app, bloomberg. Com and in the u. S. On sirius xm. More of bloomberg west up next. Emily top stories this hour, project agents with china slowly falling, but to the outbreaks pessimism. Pmi came at 51. 8, down 4 0. 4 . The China State Council meeting said more must be done to promote growth in private investment areas the aussie dollar jumped more than expected after the march tray data after the imports and rising iron ore prices. Ed twocus on this shrink dollars over 3 billion, it was a month earlier. Up one. 4 . Ions the biggest recall in the history, double in size. U. S. Regulators ordered takata to replacement 35 million. Recalls will take place in five days between now and the end of 2019. More deaths have been linked to the faulty deflator is. Those are some of the headlin