Retail in that country and laying out his plans for indias market. Also gave this extensive interview to india nd tv where he said he could see lowering prices in that country. I recognize that prices are high. What we want to do things that lower that over time to the degree that we can and so we are looking at a number of different things. What we wouldnt do is lower our quality bar. Of course, one of the bigger stories today might be the projections, reported projections for iphone 7 production as has a lot of the suppliers up today along with apple. Yes, indeed. Barrons did a writeup of it about 70 million phones where some had expected mid 60s productionwise. That maybe goes to show apples confidence in maybe what its got in the iphone 7 versus actual demand. What i think is interesting, theres a tension between local manufacturing and local invention versus american patronage. Facebooks Mark Zuckerberg saying people, have free internet, its good for you. A lot of people cant afford it, whats the down side. Indian regulators saying wait a second, we dont want the Strings Attached to that. Now the local manufacturers are saying apple wants to dump used phones here. Thats not good. That will destroy our local markets. Dont allow that. Tim cook still trying to have his way. Is it dumping or just a way for apple to get lower prices without having to lower the price of the new iphones that come into that country . Its a lot of things. Last year apple introduced its Iphone Upgrade Program where you get a new phone. What happens to the old phone . Maybe that could be growth in an emerging market or india which is set to be the second biggest mobile market. Of course, the new iphones are too expensive to sell there. Maybe the used ones are not. Tim is a good politician. I think we have seen that this week. How would you evaluate his world tour so far . Look, he has to pander to these countries. China, india, they represent a massive opportunity for a company thats already topping out in terms of market share in the western nations. There is going to be a lot of focus. As we saw, jon pointed out from facebook, you have to pay particular attention to the marketplaces to placate their particular needs. Market share is only 2. 7 . Android powers so many of the cheap handsets that it makes you wonder what apples goals in india should really be, what the target should be. They are showing up late to this party because in part, the middle class is still growing. Tim cook will point out theres virtually no lte coverage in terms of fast wireless in india. Theres been this local Manufacturing Base in phones, smartphones, that has built up over this period of time that apple has basically stayed out. For them to want to come in now that the market is growing and in effect, crush the local guys with used phones from you and me who are kind of passing them on, you can understand how that might not play well with the very same crowd that didnt like free basics. Apple is smart with the latest garage band update in china, they have these chinese, native chinese instruments that are part of that. They are writing software to appeal to the local crowd but this is that Business Case for diversity perspective, where you got to do more than just give an old phone. You got to give the customer something they couldnt get otherwise. Cook said something interesting. He said not too long ago that he sees india as where china was seven to ten years ago. China is obviously a different market, a lot more interest in luxury there. If you look what they have done for apple, the stakes are very large. They provided twothirds of the Revenue Growth last year for apple. Could india turn into that huge monster china has become . I dont know. We will talk a lot about india, more than we have been in the months to come. The latest twist in the viacom saga, the ceo and a board member filing suit to block the redstone trust. He had been moved from the trust that eventually will determine the fate of viacom and cbs, all part of the battle over Sumner Redstones mental capacity. Have you seen a chapter like this . In or out of meadia . This is like a classic drama that should be aired and would have huge viewership on cbs. The dichotomy of choice could not be greater. On one hand, you have Shari Redstone a nice smart forwardthinking executive. On the other hand, you have philippe dumon, he grew up in new york as phil doman so dont be impressed. He befriends the billionaire, sucks millions out of the company. There are two words for this. Abject failure. If you hold a lot of viacom and cbs stock and when the headlines are about you leaving the company or being stripped of certain powers, the stock goes up, you are between a rock and a hard place, no . Whats crazy, this is exactly the opposite sort of distraction that viacom needs if it will fix whats going on. This is a business that is going to be in decline. Every Business Model it has is going out the door as we turn to things like streaming and on demand and that sort of stuff. Its brands are completely losing relevance with younger people. Mtv and nickelodeon, i dont know, to me it just seems this is the last thing they need right now. Should we be looking at google, facebook, snapchat eventually, controlled companies that could end up in this position in 50 years . Imagine us sitting here as robots talking about the zuckerberg estate drama or Something Like that. Hopefully not. As an investor you got to wonder. Tell you what, the interesting thing to me is the checkmate move that Sumner Redstone played on dumond. Earlier this year he kicks out his girlfriend, takes her off the will and out of the trust. Dumond supports him in that effort. Shes arguing mental incapacity. Two months later he kicks out dumond, neutering his ability to apply the mental incapacity issue. Heres a 93yearold next week who is basically putting so you think its a victory for redstone . This guy is wily as the day is long. I bet he planned the whole thing. You think hes playing chess here . He has all his faculties and is moving the pieces around . Thats exactly what hes doing. All you have to do, look at where they have completely whiffed on digital strategy. Their stock is in the tanks. Compare that to the wonderful job les moonves is doing at cbs. The track record is pretty clear. That will play out naturally in the months ahead. What signs, if any, are there that this ends soon . That there is a neat bow wrapped around this situation and investors get some answers . We will have this drama for quite some time and it will make news for does it mean the execution that dan refers to gets better regarding the Television Product . Can redstone do that better . I think yes, because i think she yurunderstands what some ofe Digital Opportunities and challenges are and is willing to take them on. Sticking your head in the sand is not a viable strategy. Wow. Just to think when the exgirlfriend was taking him to the beach and sitting him there thinking it was weekend at bernies he was plotting this whole thing . Youre right. This drama deserves to be on cbs. We will watch that for awhile. Good to see you. Thank you for coming in. The markets are have been mixed throughout the morning. We are now seeing most in positive territory. We had hawkish fed commentary, dovish commentary out of japan and pmi numbers out of the u. S. And europe that were a touch weaker than expected. The dow is up 26 points, the s p up a fraction of one point, the nasdaq up 16 points. Check out shares of monsanto. German drug maker bayer bidding for the company. 122 a share, all cash deal that would be worth 62 billion. Monsanto up 5. 25 . And tribune shares dropping after rejecting gannetts offer. You can see tribune down nearly 16 . Top tech fund looking for china to boost its portfolio in the second half of the year. Brett singerland will join us next. The growing influence of snapchat. The company has two million daily views more than facebook. Bob peck will join us. And the ceo of Interactive Brokers on the changing landscape of the brokerage industry and impact of financial regulation. A fair price, quality service, and that horrible smells are really good at hiding. Oh, boy. There it is. Ohh. Ooh. [ gags ] so when you need a house cleaner or an exterminator, we can help you get the job done right, guaranteed. Get started today at angies list, because your home is where our heart is. Tech stocks hit hard at the start of the year and with that volatility our next guest sought a new strategy, increasing positions in higher growth Cloud Computing chinese internet names and m a driven Semiconductor Stocks while deemphasizing legacy tech. Joining us from San Francisco, brad slingerland, Portfolio Manager for the Janus Global Technology fund. There was a big selloff especially in names like sales force, like workday, that looks like a really good move. You shifted out of old tech but didnt cut apple. Why . Good morning. Thanks for having me. Yeah, earlier this year in the volatility, we fell back on our fundamental research and modeling to determine that the volatility was really not impacting the long term transition to the cloud which is really a five or ten year decision companies are making. We are seeing significant budgets move away from legacy i. T. Vendors such as oracle, hp, and into the cloud stocks. Companies such as workday, service now, net suite, sales force. Com. So we made that shift out of legacy and into the cloud stocks. Apple was really a separate decision. We are under way apple quite significantly expressing somewhat of a cautious view there. However, it is still a position in the portfolio based on the strength of their installed base that they have on the iphone currently. Big position. More than 6 , i believe. You did trim facebook. That does not look like a good call right now. You still have nearly i think three times, two and a half times, lets call it, as much alphabet as you do facebook. Why is that . Why are you so much more bullish it seems on google versus facebook . Well, we still like both companies and they are still both significant positions. We think google has a lot more optionality around their core business because of what they are doing with artificial intelligence, machine learning, youtube and the shift to mobile. While we still like facebook, we think their fastest growth days are probably behind them although we still expect them to be a significant grower in the future, just albeit slightly decelerating. Also, when we look at the businesses, we think search and youtube and some of the assets that google has are sort of stickier long term user behaviors whereas social networking has been a little more fickle. We see a lot of folks, particularly Younger Generation moving to snapchat in the u. S. Away from facebook and instagram. Obviously twitter has seen usage decline or usage slowing down. Its a little harder to have confidence in social networking long term. Its hard not to take notice that most of the names that you added to at least on the cloud side are those that focus on the Enterprise Service now sales force, work suite, work day. I wonder what Smoke Signals you are seeing from enterprise that you think that is where these companies are going to be spending their money. Yeah. Great question. I was just meeting with the head of i. T. For a large global bank last week. They currently spend zero of their infrastructure on Amazons Web Services and they expect to be at 30 by the end of 2018. A significant multi hundred million of dollars shift and we are seeing that across every enterprise. We think this is an Inflection Point to the shift to the cloud. The legacy i. T vendors have really been sitting on their hands and stockpiling cash, buying back stock, paying dividends, not investing in innovation or r d, or doing the m a needed and they are basically whistling past the graveyard while the cloud vendors are going to take all of the i. T. Dollars going forward. Interesting. Bezos made a comment last week where he said the biggest competitor to aws, actually companies who want to create and maintain their own cloud. How does amazon fit in what you just talked about . I think they are very well positioned. I dont think its going to be a monopoly in the cloud. Amazon currently by most industry estimates has 85 to 90 market share. We see that Network Effect they are building, continuing and we think they growing to continue to garner the lions share of the shift in infrastructure spending. I think we are increasingly seeing companies decline to build their own clouds, decline to go with whats called private cloud and actually embrace the public cloud which is platforms like amazon and in second place would be microsofts azure pratt fo platform, a tenth of the size. Where will the margin be in this . You dont think amazon will be a monopoly. Clearly microsoft is number two and gunning for increasing cloud share. They have this legacy of office apps and other software that businesses tend to need. Amazon doesnt have that as much. Three to five years from now, who is going to be extracting a disproportionate amount of value out of this cloud shift . Do you expect it to be amazon from its current leadership position or microsoft from its sort of rear guard but Software Strength . I think we sort of see a barbell where one side of the barbell is the infrastructure where aws dominates and azure is trying to build a business as is google. On the other side of the barbell is the very high value add applications, some of the companies i mentioned like work day. What we see as sort of the carving out of the middle. We think theres enough margin for an amazon like Business Model and jeff bezos is infamous for saying your margin is my opportunity. We think they can survive and do very well. They are currently reporting a mid 20s operating margin that. Could be tougher for microsoft. We think thats one of the reasons there has been some concern on microsoft recently in terms of margin pressure. But microsoft also has the high value Enterprise Applications around office and exchange. They do. Its going to be a battle royale. Good call earlier this year. We will see how it continues to play out, Portfolio Manager for Janus Global Technology fund. Thank you. Meanwhile, the layoffs continue at ibm and they could reach more than 14,000, according to one analyst. Is that costcutting now good news for the stock . And the ceo of a company that provides charging stations for electric cars on the reality of that technology becoming mainstream. Squawk alley will be right back. Ibm is continuing rayoffs this week after big announcemen announcements. The company declined to say how many jobs are being cut. One analyst estimates total job losses could reach 14,000. Meantime, ibm continues to hire for its Cloud Services and Data Analysis businesses. On friday the company said it had 20,000 open positions there and of course they still have more than 350,000 employees overall in an i. T. Business thats challenged with often having too many people versus cloud resources. Its a struggle they continue to manage. Certainly not alone in the struggle, either. The head of the tsa warning of more long lines with memorial day just around the corner. Phil lebeau is in chicago with the details. I know i will be at the airport this weekend reporting on how the tsa is handling whats expected to be a busy memorial day weekend and really, all summer because we will see record levels. We are going to see long lines. The good news is over the last couple days we have seen shorter tsa lines reported at a number of airports around the country. The tsa is adding staff and overtime ahead of the memorial day weekend and then going into the summertime. Some critics have called for more private contractors to run Security Operations at different airports. Thats going to take some time before that eventually happens, if it does happen at certain airports. The head of the tsa says be patient, they are adding staff. Its not just chicago. We are doing this at each of the nations largest airports and will continue to do so over the course of the summer. The recent reprogramming request has allowed me to push a significant larger staff increases out across the nation as well as to push k9 teams where we need them. What about the people applying for precheck . If you do not have an appointment but just show up at one of the locations and there are about 370 around the country, there was a line last week, people waiting several hours just to apply for tsa precheck. Remember, the goal is to get 25 Million People into the precheck program. Right now they have just 2. 7 million. In fact, its not going to be until 2019 at the earliest that they hit that target of 25 Million People in the precheck program. The frustrations continue. Although at some busy airports the precheck lines can be longer than the regular security lines. Unclear whether it really helps the problem. Phil lebeau taking a respite in the studio. See you back at the airport very soon, im sure. Snapchat reportedly generating ten billion daily video views. How the rise of the messaging app could impact twitter and facebook. Bob peck joins us on the other side of this break. My mom loves giving me advice. She even gives me advice. About my toothpaste and mouthwash. But shes a dentist so. I kind of have to listen. She said jen, go pro with crest prohealth advanced. Advance to healthier gums. And stronger teeth from day one. Using crest toothpaste and mouthwash makes my. Whole mouth feel awesome. And my teeth are stronger too. Crestpro health advanced. Is superior to colgate total. In these 5 areas dentists check. This check up . So good. Go pro with crest prohealth advanced. Moms right. Again im sue her