The mexican president wants to legalize gay marriage. Today he signed initiatives to amend the constitution and the federal civil code. Gay marriage is already legal in some parts of mexico. Bernie sanders looks to continue his winning streak in todays kentucky and oregon primaries. Kentucky is considered the bigger prize. Front runner Hillary Clinton has a significant delegate lead. Donald trump and londons first muslim mayor have taken verbal shots at each other. But he extended an olive branch. He invited donald trump to london to meet his family and the british public. Global news 24 hours a day, powered by her 2400 journalists in more than 150 news bureaus around the world. Im mark crumpton. Next is bloomberg west. Emily im emily chang and this is bloomberg west. Coming up, mr. Cook comes to mumbai. Ceos is on the apple itinerary for the very first time. Will britain stay or will it go . Sidesoft ticks picks in the great brexit debate. Company chairman John Thompson joins us to explain. Shares took another dive. But first, to the lead. Apple ceo tim cook set his sights on the massive market potential of india. He kicks off his first visit to the country wednesday. Besides an unconfirmed meeting with the prime minister, hes pushing for opening of his first retail store in the nation and announced an Accelerator Program for ios developers in bangalore. So why now . India is clearly a market to lucrative to ignore. First salesd its decline in a decade. But indian shipment rose 66 . Its described as where china was 10 years ago, saying there is great opportunity there. The opportunity could come in the form of one billion smartphone shipments thats up for grabs. Joining us is David Kirkpatrick, delprawford democrat at. You guys have been doing a lot of work on the potential of the indian market. How big could this market be for apple . It could be very large for apple. When you look at the largest market, india in the last quarter alone, with over 560 million shipments, and apple, like a lot of other markets, was focused on the premium end of the market. They ship 90 of their units at price points over 525. The huge part of the market they are not participating in. Theyre going to need to go down market to penetrate Companies Like lenovo. They have some work to do, but what they are doing is targeting a market where they can grow, but they will have to alter a couple of parts of their strategy to target it. Emily why did it take so long . It is a huge country, that is obvious. Why did it take so long for tim cook to visit india . They had a great run in china and they have been busy there. India is a country where there are a lot of barriers to entry. One of the things cook is trying to negotiate is to expedite the process of being allowed to open new apple stores, which the government has to approve. They have a lot of laws that prefer products made in india. Apples products are not currently made there. There are a lot of barriers that exist there. Its a very nationalistic kind of government, but i think the opportunity is huge. But price is a gigantic challenge for apple. Emily part of the hope is that apple can open apple stores in india, but what difference will it make if the phones are four times more than what customers are willing to pay . Thats why they have to play the game across multiple dimensions. They do need stores because it is an aspirational brand. Western brands can be very popular in india, but they will be most popular with the richest people and the most demanding customers. What they need to do beyond that , as weve developers seen in western markets, specific use cases that indian customers have. This is something nokia did very well 15 years ago. With things like life tools. They helped farmers understand realtime prices for crops so they could eliminate waste when bringing products to market. Nokia did that and got a loyal base in india. Apple needs to do the same thing. They need to get developers to study the local use cases. The last part, they need products well below the lowest point where they are today, which is 525. They need to be 150 and 200 longterm to really penetrate the market. Emily connectivity is still a huge problem in india. You still have so many people who are still not online. How much of an issue is that going to be for apple . I think connections and broadband and wireless generally is growing very rapidly in india. No country is going to be left behind, especially one as savvy as india. It has a very smart government in terms of understanding that connectivity is key to economic growth. I dont think that will be the primary Thing Holding them back. For apple to build a product for under 150 is a gigantic ship shift from anything they have done. I dont see why they cant do it, and ive often said that in a lotwth solution of other countries where they are hugely aspirational. The middle class is coming up, but price is going to be a big deal and apple will have to make a fundamentally different strategy to achieve that. Emily last question, we talked about the Smartphone Market in china as well. Can india make up for that or are they on a completely different scale, india versus china . India is on a large scale. In terms of total units, they are about half the size, but theyre still the secondlargest country. From a total available market standpoint, they can provide a Growth Engine for apple. Last quarter, apple grew over 50 . Apple can definitely grow in that area. Let me say, other premium smartphone vendors are growing. Xiaomi is almost twice the size as apple in india today. It can be done, they just need a wider range of products to do it. Emily crawford, thank you so much, and David Kirkpatrick, for speaking with me. Speaking of good well trips, jack ma had lunch with president obama on tuesday. Although the meeting was not on the public schedule, reporters spotted him on white house grounds and a spokesperson confirmed the closeddoor meeting. They had previously shared a stage last fall and discussed Climate Change and Government Support for entrepreneurs. The latest meeting comes just days before obama leaves for a trip to asia. Coming up, my interview with microsoft chairman John Thompson. What he thinks about the brexit. And, his advice for Marissa Mayer. You dont want to miss it. Emily microsoft has chosen a slide in the brexit debate. It says the country should remain in the eu. Brits will vote on whether to stay or go. I spoke with microsoft chairman John Thompson about the decision and started off by asking how he thinks the ceo is doing given that thompson led the Search Committee that hired her. None of us couldve possibly imagined back in 2013 that the perception of our company would have changed as profoundly as it has in just a little over two years. I think a lot of it has to do with satya himself, the fact that he is a very brilliant but very humble man, the fact that he is a very effective communicator who is willing to engage, as well as listen as much as talk. I think the commendation of combination of those things have made a remarkable difference in the world perception of microsoft. Emily how has he done when it comes to changing the culture . What has worked and what has not . It can be hard for a ceo to singlehandedly change culture. John i dont think he has done with the cultural change but i think hes made the right starting position. First, its about thinking horizontally about the companies capability to share those things more broadly. Next, its about creating an ecosystem for the company that candidly invites people in who heretofore mightve been viewed as competitors or archenemies. Third, its about encouraging our team to take more risks. Encouraging them to think outside the normal box of microsoft, to push the edge. He did that when he created azure. He did that when he was in the ng business. A lot of the things he had is practical experiences in prior roles really set the foundation for how he would like for the entire team to operate. Emily what would you like to see the company focusing on in the coming years . I think the focus is very good right now. Were focused on cloud and the hybrid model of the cloud, the Application Services that we can deliver not just in the cloud but to mobile devices. If i would like to see something change, its more about pace. From my days at ibm, we never seem to be running fast enough. That is always the case with an established enterprise. While you believe you are moving fast, you are not moving as fast as of the start up who wants to eat your lunch. Emily how aggressive would you want to be in terms of monetizing the cloud, which seems to be the future . John its not common to have something of that size and scale in triple digits, but it could grow at twice that rate. , given that there seems to be a titanic shift going on in the industry where everyone is moving to the cloud. So why should we not capture more of that . If we invested more, how much more would our Revenue Growth be . That is a topic of discussion we are always going to have. Are we moving fast enough to take advantage of this Incredible Opportunity thats ahead of us. Emily how do you see the cloud war is playing out . If you look at history, what you see is that in a category typically there are two or three leaders in that category. We find ourselves in the interesting and lofty position of being one of the one or two. The leaders in the cloud space right now. The question is, can we sustain that position and move further toward being the number one in the space . Emily can you do it . Amazon is giving you a run for your money. John we have a lot more work to do to catch up. The question becomes, of all the players who want to be number three in the space, can they catch up not just with microsoft but pass microsoft and amazon . We are not going to sit idly by and rest on the past success. We have got to double down as a company to make sure they do not catch us. You are also a big startup investor. How important is the Cloud Strategy to the livelihood of any start up today . John it has to be cloudbased. No one is looking for a perpetual license model anymore. I can remember, Mark Thornburg said to me years ago, i only invest in annuity revenue streams. I thought that was odd. That was five or six years ago. Well, guess what . If its not recurring revenue, they are not interested, because it has a predictability that once you capture that customer the sustainability is pretty powerful. I dont think there will be significant investments made in hardware any longer. Hardware will be necessary because all applications run on some hardware layer, but proprietary hardware solutions, i am not sure that is to say sustainable any longer. Emily microsoft came out saying they are against the u. K. Pulling out of the eu. Hq has said the same thing. What are the implications for u. S. Technology companies if brexit happens . You dont want any more geopolitical instability. We have enough instability in the Global Economy as it is. To the extent that there is a Material Change in the eu consortium, that creates geopolitical instability and that is not good for the environment, be it the Business Environment or the citizens of the european community. Emily what about china . Have any Technology Companies cracked code in china . I think you know the answer to that, and it is no. Were trying to hold to our standards and principles as a company, but find a set of things we can make as concessions to the Chinese Government that gives us access to the billions of users that are there. It is balancing the standards we have and the consistency we want as we run our business with the interests that we have been having access to those users. Emily could india be a Replacement Market for china . No. It certainly could be a supplemental market, but you something that is 1. 8en people being billion people big and growing at 7 . That is down from 11 12 , but you cannot replace china. You can certainly augment china by having a stronger focus in india, but you cannot replace it. Emily you were ceo of semantic for many years and youre going through another ceo transition. What you think about what is going on there . Its a huge personal disappointment. I spent 10 years there and i thought we were on a very good path. Obviously we were not. I think its time for not just the team of the company but the board of the company to do a little self reflection on, have we made the right calls . Have we made the right calls on people, have we made the right calls on ourselves . Its time for a lot more self reflection, but i dont know, im not involved in the company at all. Emily yahoo is going through another existential crisis. What would you say to Marissa Mayer right now . John hang in there. I had activist investors engaged at semantic, but only for a brief time. One of them was carl icahn. Fortunately for us, because of the volatility of our stock, carl icahn bought low and sold out. We never really got the public exposure that Marissa Mayer has gotten. I think she started with a tough hand that was dealt to her and quite frankly, she needs to play it out. Dont let an activist push you to do something you dont strategically believe in. To the extent that her board supports her, then hang tough. Emily diversity is an issue we have talked about a lot when it comes to the Technology Industry and the lack thereof when it comes to women and minorities. Given how many years you have spent in the industry, where have you seen the most progress and where is there still the most work to be done . Some of the more established companies have clearly done a better job. Older Companies Like ibm have done a terrific job of at least raising the issue and trying to do something about it. It ultimately comes down to the numbers, not the words. Numbers dont necessarily support the words right now. I was quite shocked when i came to the valley in 1999 and everyone was so enamored of the fact that i was the highestranking africanamerican in the valley. Im like, whats the big deal . I now recognize that it is a big deal. We need to do a better job of diversity and inclusion. I think Companies Like microsoft and google are working hard at it, but they have to double down or triple down to make real progress. Emily that was John Thompson, microsoft chairman and longtime tech executive and investor. I now want to bring in our News Reporter who covers microsoft. What do you think is the most important thing he said in that conversation . The scorecard he gave for microsoft is very similar to what investors would. Particularly with regards to the Cloud Business shared they must do more and faster and the Cloud Businesses have to continue to grow at an increasingly rapid rate as some of the traditional businesses start to decline. This is still a Company Whose revenue is in decline. Emily obviously the cloud is doing well. A lot of those businesses are still reasonably small, compared to microsoft overall. They are behind amazon in cloud infrastructure. As he mentioned, they are growing more than 100 , but they need to be a larger percentage of the microsoft revenue because Traditional Software businesses are starting to atrophy. Starting to turn into a situation that is going to stop growing. The question for investors has them thew do you make future. How do you deal with the competitors who are trying to catch up in the case of google and ibm. Emily John Thompson there, and deena bass. Thank you so much. Coming up, its no secret that americas infrastructure is crumbling. How will a fleet of autonomous robot boats help . Emily a story we are watching. Pandora under pressure to put itself back on the block. A hedge fund managed by carl icahns protege has taken nearly 10 stake. Making it the largest shareholder. In a letter to the board, he suggested pandora should explore the potential value to shareholders that can be realized in a sale. Pandora was said to have them the help of Morgan Stanley earlier this year but with the reestablishment of Tim Westergren as ceo, the idea appeared to be off the table. It is full steam ahead. Emily he said he was surprised by Tim Westergren returning to the helm of pandora. Shares closed 6 higher in tuesday trading. Coming up, will the fiasco spell of lending club spell trouble for the wider online lending space . And if you like bloomberg news, check us out on the radio at bloomberg. Com. More on bloomberg west, next. Show me top new artist. Ah, ha ha. Show me top male artist. My whole belieber fan group. Its not a competition, but if it was i won. Xfinity x1 lets you access the greatest library of Billboard Music awards moments, simply by using your voice. The Billboard Music awards, live sunday may 22nd, 8 5 pacific, only on abc. The top stories in this hour. Asian stocks have fallen after strong eta fuel the case for more hawkish policies. Have going s gone from losses to gains. Oil is extending its sevenmonth high. Chineses spread to more cities last month. Places climbed in 55 cities. Beijings thirdhighest ranking official says that hong kong should actively participate in chinas development as part of a belt in road initiative. In an audience of political leaders. Hong kongs prosperity is important to china. Those are the headlines from bloomberg news, powered by 2400 journalists in around the world. Here is juli