John fort still at the mobile congress in barcelona. Kayla and myself at the New York Stock Exchange as the market for a second day now well see if it gets back up again. Were down 2000 points after yesterdays losses. We have been in the red pretty much all morning long. S p below 1900. Crude in the red over 2 . Well keep our eye on all of that. According to the ap apple will tell a federal judge that the fight against the fbi should be decided by congress and not in the courts. It appears the case is already not a one off decision. The doj is demanding apples help in unlocking at least nine iphones in addition to the one used in San Bernardino. He joins us to talk about that and a lot more. Jason we have not taken your temperature on this one. I imagine you have to have some striking views. Yeah, its a very complex issue and its one that we cant let the publics sentiment decide because obviously the public wants to see our country be secure. This is a complex issue. Its not a typical situation where you say this bank god robbed, can you just give us the video tapes so we can find the people that did the crime. This is hey, can you create a back door for us to get into phones and encryption is so powerful today its going to be possible for people to have their communications secured to people of course are saying is apple grandstanding here and is the government overreaching . Probably a little bit of both. The government has done very bad things when they have these tools. We know that from the snoeden leaks and then you have apple which is going to hang its hat on being the antigoogle. Were going to encrypt everything and its going to be dozens of Companies Going through this and the public has about as much fortitude on this as the distance between the last terrorist attack and the intensity of it. This is a country, our country that sadly was in favor of torturing people after 9 11. We get very scared as a populous so when you look at the public polls i think theyre very dangerous because people dont really think through a very complex issue. But the populous has also come to value its privacy to a great degree especially as we learned the extent to which the governments programs have reached and im wondering why you think an appointed judge would be better to decide this than a popularly elected body. Yeah. So the public after we saw the celebrities, you know, private photos get hacked and when Ashley Madison gets hacked the pub hick does become more and more aware each year of the cost of losing their privacy. And people in favor of privacy. You have a 5040 split and something to that effect. Whats going to be dangerous is for apple on a corporate level if we have a republican in office and another ftc investigation happens its a very popular stance to tell the government that were not going to cooperate in terrorism and if you look at google they have been very cooperative according to the leaks and their ftc investigation with obama magically went away and the wall street journal had that incredible story where the ftc leaked apparently information about that investigation. So a lot of this is tied together. These Big Companies are taking huge risks by standing up to the government. Apple is not doing this lightly. But then jason youre saying its complicated. Each side their their own interests. It depends on very shortterm the way the public runs hot and cold regarding privacy security. How are we supposed to make law out of that . Yeah. This is going to have to go to the courts and congress and its going to be a long, drawn out process. And the government is going to keep banking at apple. If theres another significant terrorist attack and its going to be very, very unpopular. The government is becoming very savvy to this and theyre riding the publics desire to see the country be safe. As a group were cowards. We get scared and we want the government to protect attacks. The government is going to pound apple into submission. The discussion will go on for awhile. We know that. On a much lighter note, breaking news from instagram today. Julia is live in l. A. With that. Good morning. Good morning. Thats right. Instagram announcing it now has more than 200,000 monthly active advertisers. Thats up from hundreds in june. 75 are outside the u. S. And the vast majority are small and medium sized businesses. Whats most striking about instagrams advertiser number is how it compares to twitters which has 130,000 advertisers and it opened its selfserve ad platform four years ago. How have they been able to ramp up its advertisers numbers. Facebooks base can easily tack on adds in instagram. Instagram telling me that having so many advertisers now allows it to better taylor ads to users interests making them more useful and more effective for brands. The company also saying that three quarters of users who follow businesses on instagram say that they take action after being inspired by a post. Like a website, searching, shopping or telling a friend. Looking at the fact that facebook has 2. 5 million advertisers and the time that people spend watching videos on instagram is on the wise. We can expect them to start making a growing impact on facebooks bottom line. Over to you. Fascinating numbers. Over to that. Jason, here we go again. Comparing me tricks between a book entity and twitter. Is that a fair fight . Listen, facebook is in advertisers. Twitter is never going to hold a candle to it and facebook has the complete data set. Lets face it. Facebook has all the data of the facebook users they can use to leverage the subset of instagram users. Theyll never be able to compete but instagram is a very unique case. Its only going to work for a Certain Group of advertisers which is people that have big beautiful photos and big beautiful products and emotional collateral. Whats really interesting about it is its very native isnt it . The ad does not look anything like an ad. Nine out of ten people that see an instagram ad do not know its actually an ad. Its a beautiful picture that would have normally been shared by michael kors is the famous example but what these brands get in addition to the ad is people click on the account and follow it. You get this lift of i can ingreece the number of people following levis. Following michael kors, or target or whatever it s. Its a pretty powerful medium. What im hearing from people is its been very weak. I think for brands like lulu lemon or travel its going to be a juggernaut so its replacing the magazine business. Something that would be in vogue or vanity fair, perfect for instagram. Not perfect for instagram. Whats also unique about the instagram ads is they have the arrow on top of the picture that lets you click through. Thats something you obviously dont get in a glossy magazine. You bring up the important point which is that these ads are big and you might be able to have 200,000 advertisers but once you get to that point theres a question of how much ad load that type of network can support. But how much do you think instagram itself could support . So yeah theres really two issues now. One is how much can each individual handle . I would argue if the ads are targeted properly, users will be able to handle a lot of ads like they do on television which is one ad every couple of swipes. Thats good news for instagram. The user base for instagram is very interesting. Its very popular in urban areas and in the hip hop community. This is a really Influential Group of people that move culture. If you look at nikki minaj or people like that on instagram and they get hundreds of thousands of likes. Amber rose is another one. This is a very unique moment for advertisers to reach young people, millennials and the urban community. I think its going to be a juggernaut. Its amazing. Sometimes youll hear about a star and they have so many followers on instagram. Its sometimes hard to believe. Moving on very quickly jason. The video of the morning were calling it. Googles boston dynamics and this shows atlas walking inside and outside and the ability to open doors. Can get up after falling down. Ill tell you jason, you look at this and vr and its clear that were in the early innings of technology. We probably dont even comprehend yet. Yeah. This one is a video Everybody Needs to watch right now. What you see in the video is the boston dynamics team, you know, the proctor taking a package and having the robot pick the package up and put it down and then in truly boston fashion he takes a hockey stick and starts moving the box around and fracking with the robot. You can see it getting a little bit upset and knocks it down with the hockey stick and i can tell you be careful because computers have very long memories but whats really interesting is this is really the end of manual labor. When you watch this video hes walking through the snow and wobbling but he gets back up and he is picking up packages or she i dont know why im calling it a man. It is picking up packages and this is the end of manual labor. I just invested in a company in hong kong thats going to replace every barista in brooklyn and San Francisco with a robot that can make coffee perfect and without having to, you know, get upset at you for putting sugar in it. Although, theyll find something even more artisal to do with their coffee that a robot cant do. Id like to see the outtakes from this video. I want to see the robot fall down. I want to see it do something wrong to help me sleep at night. You have to admit theres a little bit of this that is pretty eerie. Its super eerie and, you know, in ten years, 15 years the idea is going to be would you let this, put your kid to bed or change your kids diaper because thats how fast this is going to advance. Its picking up packages right now. These things are going to be walk down the street in 10 to 15 years delivering pizzas. Theyll be in your Office Moving packages around. Manual labor is going to end in our lifetime and you can see how close we really are. Its a huge issue with jobs but a huge lift in terms of efficient of companies that nobody expected. Already this one looks like a human but the robots in the amazon factories dont look like humans but theyre doing very similar tasks. What you see here is a platform. This thing is going to be very easy to program and in five or ten years when they make it out in the work force and the programmers get to work on the apis theyll be flawless and more human than human. Lets hope they cant read a teleprompter. Or talk stocks. It gives you a feeling of what our grandparents and great grandparents must have thought when the idea of flying in a plane came about. Its something entirely new. We have to get our heads around it. When we come back the government hoping it can enlist hollywood and Silicon Valley in the fight against isis. Well tell you what it has planned plus xiaomi getting ready for a major expansion. And were still watching the markets. Dow is down 220. S p 1896. Oil under pressure again. Were back in a minute. Executives from Tech Companies and Hollywood Studios set to meet with white house officials to talk about the fight against isis. Aman is live with that story and they have a lot to talk about. They really do. Theyre calling todays meeting the Madison Valley wood project because its bringing together executives from madison avenue, Silicon Valley and hollywood. Theyre going to meet at the department of justice at 1 00 this afternoon. The goal here is the counter violent extremism in the media and in the internet. And according to a copy of the agenda for that meeting that i obtained from a source last night theyre going to break up into groups of 8 people at a time. Theyre going to go through strategies and plans for how to combat isis on the internet and in the media around the world. The idea here is that the United States can leverage some of its strongest strengths. Silicon avenue, and hollywood against isis which has been so active on twitter in particular and very effective at recruiting teenage supporters around the world. This idea they can brainstorm and come up with strategies for that. Its not clear whether theyll succeed or not but theyre getting together guys. It will certainly be interesting although have to say Madison Valleywood is not a covert code name if thats what they were trying to do. Thank you. Up next, chinese smartphone maker xiaomi to make an expansion into europe. And were still watching these markets. The dow falling down 237 points. Markets moving on the back of oil but the next thing that could move sit the close in europe. Thats coming up in a few minutes when squawk alley returns. Here at td ameritrade, they work hard. Wow, that was random. Random . No. Its all about understanding patterns. Like the mail guy at 3 12pm every day or jerry getting dumped every third tuesday. Jerry every third tuesday. We have Pattern Recognition Technology on any chart plus over 300 customizable studies to help you anticipate potential price movement. Theres no way to predict that. Td ameritrade. After a busy week mobile World Congress is wrapping up. Big announcements today. John fort has more on both. Well, kayla, patrick stopped by to talk with me today about atlas. Its a new initiative theyve got that allows start ups overseas to incorporate in the u. S. Thats important because the infrastructure exists for them to do Business Online in ways that they couldnt before. What about fraud . What about terrorism . I asked him. Take a listen. Stripe will be conducting kyc. They have to be invited by somebody we trust. And so if youre some kind of out to do something, its an easier path for you. I also talked to the international vp at xiaomi. They announced the 5 phone today. Its going on sale in china march 1st. Its the new flag ship of the company that had such a big impact in emerging markets but its interesting. I also talked to him about the Business Model because they dont so much make profit over the hardware. Its about the services and software behind the hardware. They have 750 people. Their biggest investment in software and services and i asked him how is he going to extend that outside of china . Its their next big market. Take a listen to what he told me. We have done a lot of sophisticated things just offering content. So well bring these ideas to other markets. For example were thinking about what will content look like in india with 4g Networks Coming of age. So a lot of exciting evolutions which will allow us to bring our Business Model inside of china. With those two things together its clear they know that they cant be a content provider in the same model outside of china but they have lots of ideas include a new video app that theyre releasing not just on their operating system but also outside of that. Theyre going to release a version on ios as well. This is a company stepping out as a Software Company looking to sell experiences and this is the beginning of it right here in barcelona at mobile World Congress. Back to you. Im wondering what the reception is like for xaoimi. Its the first big public event when so much of the mobile world is critical calling them copy cats. I wonder what its like to have them all in the same room. Well, i asked hugo that. This is a really well intended precede precedent. They developed their own design language. This is in a way that samsung arguably copied. They managed to get the camera flush with the device in the back which is something others havent been able to do before. And also they have done some things along the front with the curving of the glass. Thats some things that samsung has done. They have a very hard material thats going to prevent scratching. Theyre really pushing innovation here. This also the snap dragon 820. Its a very important launch. Theyre really pushing the message of speed. The other oems are going to have to keep up. Her going to have to adopt that snap dragon 820 as well. You covered so much whether its intel or squall come. Whats going to be the headline out of this congress. Now that smartphone growth is over what are the tactics that Different Companies are going to have to do to make Virtual Reality into the next big thing or on top of it. Its still about reaching for that. The next 18 months or so well start to see a shake out. Is htc as good as their by product is . Be able to stand up to oculuss juggernaut. Were going to start to see it. Johns ability to do a live shot. Thats multitasking at its best. He got his exercise for the day for sure. When we come back. Former fbi special agent joins us to talk about the governments fight against apple and what to expect next. Stocks in the red. Close to session lows down to 225. The next thing to watch t close in europe. Thats next. Good morning, everyone. Here is your cnbc news update at this hour. House Speaker Paul Ryan says republicans in the house of representatives are preparing legal action. Yesterday the president unveiled plans to close the facility. Meanwhile, texass highest criminal court tossing the second and final felony charge against former governor rick perry. They dismissed the abuse of power charge which was filed after perry carried out a veto of state funding for a group of public corruption prosecutors after the democratic head refused to resign. They began delivering much needed aid to the remote islands d devastated by a cyclone last saturday and tiger woods posting a video of himself practicing his swing on twitter with the comment progressing nicely. This comes after rumors were swirling and denied by his agents that woods could barely sit up in a car after back surgery. I dont know he looks pretty good there. Thats the cnbc news update this hour. We wish him a speedy recovery. He sure silenced a few critics. He did. Thanks so much. Europe is closing and pretty much right across the board. Europe is very much worse than the United States. I would point out that in a very broad based decline you have seen the italian and the Spanish Banks come back with a lot of negative moves as well so it sli moving to the down side with greater force. Almost 3 . Almost