Stocks after starting out looking like it was going to be a rough week. Well see how friday finishes out but things are flat right now. Jack dorsey heading back to the helm of the company. Hell going to run things why they try to find a replacement for dick costolo stepping down on july 1st. Shares did pop on the news yesterday afternoon and you can see theyre up almost 5 in the premarket and as we said we will be talking more about that in a little bit. In addition alstom is defending General Electric deal to officials. The french Engineering Group is trying to sell its power business to ge. Reports of a statement of objection from the European Commission did not prejudge the outcome of the inquiry. Retalked about this on the show but they suggested qe needed to offer bigger concessions to win eu approval it needs to pay for an expanded recall of cars. In other corp. Gnat news we just talked about blackberry may put Google Android software on one of its devices for the first time. Reuters says the change well according to reuters would be an acknowledgment that blackberrys devices failed to win mass appeal. So reuters figured out that no one has a blackberry except becky anymore. Reuters shunned android saying the blackberry 10 line would be able to win back market share lost to apples iphone. Hopefully nobody tweeted anything about you yesterday. When i have my iphone charged i can see it there. I didnt have it charged the other day when you were sending me things. So if you had to pick one to charge and one not to charge. Its the one that i have the charger for and by the way, the iphone runs out of charge faster than the blackberry does. Is it an iphone 2 or something . 5. 6 is a little better. A little bigger and a little better. You have the 5. I have the 6 regular. You do . I do. No i have the six regular. Does that make you superior to me. No. I do not feel anything. I feel completely what have you got there . Thats true. Hes got the six. Yeah i do. My kids bought that for me. You thought it meant something. You thought i was one of those militia types in western jersey in the bunker. On todays squawk planner well have inflation data. The may ppi rising by. 4 and eight ten a first read on june consumer sentiment. A key number for the energy market. The north american rig count will be released at 1 00 eastern. Thats a weekly census of the number of riggs actively exploring for or developing oil and natural gas in north america. By that i mean United States and canada. Mexico. Mexico is part of it. Lets get a check on the markets this morning. As we showed you, the futures are relatively flat but you have to look back at whats going on this week. Stocks were up once again. They didnt hold on to the gains we saw around this time yesterday because there were concerns that the imf said the greek bailout talks had stopped and they werent making these discussions anymore but you did see the dow up by. 2 yesterday. If you add up what happened over the last couple of days its the best two day gains for the dow and s p 500 in a month. Theyre on pace for the last week since late april. The dow snapping a five game losing streak if it can hold on to things today. Take a look at the early trade in europe and you can see modest declines this morning. The dax is down slightly. Ftse is down by. 3 . In asia overnight you saw that the nikkei was slightly higher. It ended up over. 1 . The hang seng up 1. 4 . Oil prices look like they are sitting right around 60. They have given back around 1 . And if you check out the yield, on the ten year note youll see its yielding back below 2. 4 . 2. 39 after touching above 2. 5 . Highest levels in about 8 months. The dollar this morning is up across the board. Euro trading at 11188 and gold prices look like they are slightly lower. 1,000, 179 an ounce. Lets get back to the biggest story of the morning. Costolo stepping down at twitter. Just two weeks ago kara asked him directly if he was planning to stick around. Listen to their exchange for a moment. So youll be there at the end of the year . I have to focus on my job and what ive got ahead of me. I dont worry about am i going to be working here on this date or that date. I focus on my job. And you feel youre in sync with the board. I dont feel like im in sync with my board. I know i am. We communicate regularly. I probably overcommunicate with them and were in sync. He told investors theres never a right time to begin a transition. We want to show you whats going on over the past couple of years here. Look back at the leadership. Theres been a lot of transition and maybe explains a little bit about how they have developed this narrative about how organized it was this time and then Evan Williams stepped in and kicked out jack dorsey out of that role. Someone they trusted. The relationship went sour. This all went down from the height of the financial crisis and then what you had was Evan Williams had been running the company and then he jumped in and took his role when things were not working out there either and well now were back to jack dorsey. I have been making lots of calls. Theres a couple of points to be made. Yes it looks like he jumped but it was it appears that he jumped before he was pushed. He started making noises about this in january that he might want to leave but there were already noises on the board before we started talking about it that he should be leaving. So theres a disconnect of whats going on. One of the things they tried to say over and over again is im leaving and im not taking no severance pay. Because he is stepping down himself. However two things one is they extended the contract to july 1st so he gets 6 million. Thats the day that the shares vest, his last so he gives up 10 murder in the second degree. You can say what you want about that. But the other thing thats the larger point is if you really wanted to leave on a high note you would have tried to sell the company. One of the things i did learn over the past couple of hours yesterday was that they have had talks with people like google and others and its not so clear that google and others want to buy this company. Thats why the market cap is 23 billion. Thats the biggest problem that they face. If you really western being pushed there were a lot of other things that would have happened. He is giving up 16. 8 but hell still get a different 5. 6. You say that comes down to giving up 10. I think its closer to giving up 10. They use a 17 million and then 5. 8 million. Because theres 5. 8 million that comes due literally in just a couple of days. Right. Nonetheless anyway i will just i have serious questions about the narrative of how this happened. I also think they began looking for an ceo two or three months ago. Theres feelers been put out by Board Members and other things. Whats interesting is dorsey is not on the committee. And another thing is somehow he says if i leave the company right now then it makes the transition easier. Wont be rumors and speculation and well be able to operate our company. Hes staying on the board, right . Hes staying on the board and now that jack dorsey is in this role it will happen anyway. Hes not on the Search Committee and Evan Williams is. Thats true but does that change the dynamic in terms of the rumors and speculation of who is going to take over the job and what its going to do to the company . They can ask dorsey to stay . They could. But he doesnt want to pursue a different strategy than the current strategy thats already laid out which isnt working. I dont know if its not working but he lost a lot of its hard to work for costolo it seems like. Right out of the gate with him. Some left on hill. Some of them he pushed out. Anyway the decision to leave twitter at the end of the month causing a frenzy of tweets. Whats next for twitter . The person thats got the answer this morning, she knows more about this than all of us combined, she is in los angeles this morning. Good morning to you. Jack dorsey back as the interim ceo o ceo. He is sticking with the companys current strategy. One of the reasons that im stepping into this interim role is because of the belief i have around our direction and our strategy and specifically around the product. I have a lot of context for it as chairman as talking with the Management Team running its and i believe its right and i dont anticipate any change. He will remain on the board as twitter begins its search for a new ceo. Former ceo will be part of the Search Committee. Now internally there are two names in focus. Adam bain currently head of global revenue and partnerships. Hell well liked in the Advertising Community but criticized as not having product experience. He noted the companys cfo is said to be too much of an outcider to Silicon Valley as a former wall street banker and lacks that product experience. This management shake up is likely to fuel more m a talk. A long timeshare holder saying that twitter would make a good fit for google and on the press call he said while the board would evaluate any offer the po cuss is on maximizing twitters value for shareholders and theres no reason that twitter cant do that as an independent company. Thank you julia. Join oing using us with more is anthony. Hes security senior analyst. You heard our discussion earlier. What does the company need and who is the person that could theoretically do that . They need someone very product focused. You have to think about it in terms of user growth which is stalled and then in terms of modernization which is decelerating. Can it be a financial person . Can it be the cfo . Its more likely and probably most likely to be a product person. Somebody that can convince the mainstream what to use twitter for. How do you keep regular people coming back to twitter . Right now theres a lot of Internet Properties charger than twitter in term of users. Facebook, marijuana, instagram, more than likely a product person. If youre not in the use business like us i dont like tweeting very much. But i like once in awhile instead of going to a news service ill see it there. Thats where i found out about the Boston Marathon bombings. All of that. You see it all there. But if i wasnt a news person i dont know whether id want to hear what someone was saying and i dont know if id want to say anything so that everyone else can hear. Id go to instagram if i wanted to share pictures. What is going to attract people. When twitter was founded there was a conversational element it was real time public tweeting and conversation with celebrities and political figures and things of that nature. Messaging apps have taken a bit of the market share of that use case and twitter has become a broadcast in a lot of cases. Its for big events. Lets hit twitter for the latest real time information about that. That has value but most of us would like to connect with our family and friends and thats the case for book. Twitter has one fifth the users of book. Is it because the market capitalization is at 23 billion . Are they being coy . Thats a factor. We know they had interest in it in the past and the valuation of twitter has come a long way and its long rumored that google could be interested. They already Work Together in two major ways. The search agreement that was forged and the double click deal. Once you have that agreement in place you actually need to own the company. Yeah. Youre already leasing what you need. Why buy it. Right. So once people admit im going to stay on it how do you get somebody to buy something based on using it . Thats the second thing. Now i understand i get promoted tweets. But theres this idea that eye balls will translate into some positive thing that happens to people that put stuff on it. Im not convinced it does that. Thats a tough sale too. The monetization part. They did hit a wall in the First Quarter in terms of the ad growth. Its about direct response advertising. So these are commerce based ad formats that twitter has on its feed and the engagement rates on those ads are quite low and that suggests the engagement with the content is low. If youre not going to favorite it youre not going to click on the tweet. Then its less likely youll engage with the ad and that really puts a lid on the monetization. Do you get those things and i see it and its like what is this . And then i hit it and it says get rid of it tweet is irrelevant. It gives me choices for why im getting rid of it. Whenever anyone that i dont follow tries to i feel violated and i do tweet is irrelevant and it goes away. Youre happy again. Im happy again. Thats a sponsored tweet. Not only am i not buying what theyre sponsoring but it annoys me. Maybe what some might say is that google or facebook have come a long way in terms of number of advertisers, their add technology, their ability to measure the effectiveness of those adds could strategically help twitter in terms of the adds. Whats the value of this company . Somewhere in the low to mid 30s. Thats a premium from where it is right now . Yeah the thing about it is it does have unique characteristics in terms of that news broadcast use case but it has a history of volatile management. Thats lower than where it is. Thats lower than where it is. Its at 37. Im neutral on it. Youre thinking 23 million market cap. Stock price. Im talking market cap. You think below where it is right now. So the question really is because of the volatility in leadership is it worth more in the hands of somebody who has a greater tool of advertisers to draw from who has better ad technology. Thats a hard question but its the question well ask. Roger was here and he said last week that look its great product. Somebody could do something with this but you sound less convinced. You can do something with it but not from here. Its an excellent niche product for the use case that were talking about this morning. I think its unlikely that it becomes Mainstream Media reach product the way Network Television is. The way the ambitious statement of the company lays out. I think it has a place and its a very valuable place but its less of a mainstream audience. A great line yesterday, sarah lacy wrote his biggest problem is he was the coo of a company while book exists which is basically its not book and it never really will be facebook. Yeah. Even though they sort of built this argument and arc that they could become facebook one day. They do have something that facebook doesnt have. They do have a use case thats unique and different but they havent been able to grow those users. 302 million users and facebook acquired whats app and that has north of over 700 million users. I know. Facebook messenger. Wheres the audio guy you said it. You brought it on yourself. I stopped doing that to you . He used to get so mad. Thats amazing you guys pulled it up that quickly. Cannot we get it up quickly buddy . Am i right . Or am i right . Thank you. Thanks for having me. Programming i got that. Got to be quick. Got to be quick. Thats for sure with you. Youre quick. I know that. Anyway. Kidding this squakward moment is brought to you by joe kernen. I disagree with that. I vote in favor of you. Im going to get more awkward here. David faber will be joined by this is amazing, dick dick costolo and jack dorsey at 10 00 a. M. Eastern and then an exclusive with rupert murdoch. Im kidding. He broke that news and now hes going to have these guys this week. Did anyone over at the other organization mention that cnbc broke the news about thats embarrassing isnt it. I dont know what organization youre talking about. Thats a little embarrassing to have to in your report say cnbc first reported. Its complicated. It s. But he doesnt have rupert. By next week maybe. Lets hope. What did you say earlier, hope springs eternal. I saw the other night the person that coined that term and i forgot who it was already because im old. They did say that and i cant remember. Ultimatelyall about the markets. Its good to be hopeful rather than give up. Morning in america. Morning in america every morning. Whats up . See you later. Come back. Will you come back . Absolutely. Well talk about netflix. Coming up when we return shocking new numbers on cell phone saturation and how much data well all be using just a few years from now. We got the ceo of ericsson thats going to join us next. But first heres a look at this date in history. Implths welcome back. Smartphones are a tapel in our every day lives but is this just the tip of the iceberg. Ericsson is out with a new report of revealing findings on our obsession. They believe by 220 70 of the worlds population will use smartphones and carry the equivalent of 4. 2 billion movie downloads. Lets hear more from hans who is the president and ceo of ericsson and joins us from stockholm. Thank you for being here. Thank you. The numbers that i just shot off, what does that mean . How much growth do you think well be using in term of the data we pull off the Network Every day by the year 2020 . Its staggering numbers. Well see exponential growth in the next 25 years. We need to remember its 500 million subscriptions in the world on 4g and the majority of the mobile subscriptions in the world are still on 2g. So the next five years theyre being built up but the prices of hand sets coming down makes this in the Biggest Technology that has ever been deployed so this will have not an impact on people like you and me having a smartphone. Well see industries being transformed and of course society where impact is going to be on everything from health care education, et cetera and thats what were going to see and well already see a lot of disruption based on whats going to be so vastly deployed all around in the world. We had localities of discussions here in the United States about how were going to handle all of that data. The networks need to be built up substantially to be able to handle that. How does that play out for people in terms of paying to access broadband . Who pays the networks and are we up to the task of being able to do that . So far thats what we believe in the future. The data will grow. We believe its going to grow nine times the next five years and three ways were going to solve it. One will come out more spectrum in the world. Second every new technology from 2 g to 3g or to 4g is more efficient and finally we constantly innovate new ways of sending all of these data bits in the air. Were spending 5 billion u. S. Dollars in research and development every year to innovate that. Those three toge