Others remain missing, 100 homes were completely destroyed. Another 300 were badly damaged. Global news, 24 hours a day, powered by 2700 journalists and analysts in over 120 countries. This is bloomberg. This is bloomberg technology, facebook shares fall after announcing a change to the social network. Mark zuckerberg says it did increase User Engagement. On monday extremism, congress was to hear what facebook, google and twitter are doing to fight it. All three tech titans are set to testify on the once again. , is of a Public Health crisis when it comes to children . We look at why some apple shareholders seem to think so. At first, to our lead, shares of facebook falling more than 4 on friday, turning in the worst performance since september. In a post on the thursday, Mark Zuckerberg said it is residing the newsfeed to them include friends and from family ms from business, print and media and any by making these changes i spent the time people spend on facebook will go down but i also expect the time you do spent on facebook will be more valuable. The ceo made a not too concerned over potential applications advertisement helping social media. Walk us through what happened, what Mark Zuckerberg broke and what led us to this moment. This is all about Mark Zuckerberg bringing race but back to his roots. That is reprioritizing posts from friends and family. He is trying to tweak the algorithms so the stuff you see first will convince you to share, like and write comments back and forth. Maybe a friend asking for advice on a vacation, that will be prioritized over articles that consist of this passive reading and facebooks own internal Research Found that that consumption is not good for peoples health. It makes them feel bad. If you want to make social media feel good again, this follows some quarters where they have been declining consumption on facebook amid this pr crisis of fake news, dissemination of propaganda, suburban really want to redirect the conversation on facebook. I want to bring in brine, joining us from portland, what you make of this, how big of an impact will it have on the experience of facebook and the business of facebook . All remains to be seen, it is pretty clear to my analysis of the data i have that uses per user was already ali based on some limited data but highquality data we have from nielsen for august and september. In large part, this may be responded to trends that were already occurring and to the extent that they are recognizing that there were real problems are the experience, they responded to her, that is positive. From a perspective of the broader ecosystem that is facebook, they have made themselves a critical part of it, this is bad news for publishers in general, at least initially to the extent that they have been relying on facebook or distribution of their content through organic means. Facebook will just be a less important place to go and from an advertiser perspective, it is not clear but if there is less consumption, one might visibly assume that there will be less inventory for ads. That is not entirely clear, there needs there may be the same amount of inventory as before. What you think this has to do with facebooks concerns about User Engagement versus concerns about meddling in the election lies in our putting respective ideological silos and create a more divisive feelings than less. At think it is a combination of them both be connected. Has already been increasing engagements of facebook is responded to that, they need to get those numbers up in the longterm, they were unable to feel safe and make this a place they want to continually engage in. But as brian sent, that could that brands and publishers will turn to other platforms like twitter, snap coupling in. This can be very good for them but i did speak to some marketers that said their clients plan on staying on facebook. Actual is to focus on individuals and people to send a message versus the big public brand profile pages. Doesnt appear this is more morally or business motivated . Think that it is both, i think zuckerberg is thinking about the longterm impact of every decision they make on the platform. As a when they are looking at the longterm hope of the whole enterprise, they are the fee up with a and not so worried about the short term. What are we hearing from advertisers and people who work with . How do they feel about this . s terms of the people hurting the most from this change, there will be Smaller Companies with newer up upstart publishers like buzzfeed and on facebook to spread their their numbers and impressions, i did speak with a start of founder that says they were most of the business through facebook engagement. As a result of this, he realizes his content will no longer be prioritized to users and he will be looking toward other means. As a result of this, a lot of the startups are also very frustrated. A while ago he really change his strategy. What does this before the advertisers small and large at the whims of facebook . There is a couple of ways to look at it versus agile spenders of advertising, it may not change the budgets. They spoke probably does have a fair amount of pricing power. The only beneficiary might be google to the extent that nobody else has anything laced like the skill and skill of facebook, twitter, snapchat quirks to the antitank offensive. I think that there is a shift to spend a paid media, it would be to google properties, if not premium publishers directly. I think one of the things that is not fully appreciated is that anyone who is been counting on facebook for organic reach of consumers now realizes more than ever that they need to own a direct relationship to the own asr, they need to much data as they can about customers, investing in the own share and distance, investing in their own web experiences on their own digital properties. That was actually good if you think about it for adobe or salesforce or anyone in that space. Much to look forward to and watch for, it will research, think of her joining us, thank you as well. We are also watching twitter, shares gained, more than 4 hitting the high salt in over two years. Raised their price target to 25 from 35 and said the company is in the early stages of a multiyear turnaround. He added the company may prove to liable to remain independent, the Parent Company of Bloomberg Television produces ticktock, a global breaking news network for sweater. Up, less time google, facebook and twitter on capitol hill, it was all about russia, next year, they will be fighting on that extremism, that is next, this is bloomberg. Alisa jeff bezos is jumping into the dreamer five. The amazon ceo is announcing that they are donating 3300 33,000 toward a scholarship. Bezos was one of the signatories thanjanuary 10 letter more 100 ceos urging lawmakers to pass legislation by january 19. The date the current government under major legislature expires. Capitol hill is far from done with google, facebook and twitter after grilling top lawyers from the tech giant over russian interference and the election. Esent lawmakers want to hear from them again and this time to examine what the platforms are doing to fight the spread of online extremist propaganda. That will be on january 17. Yet joined by someone intimately familiar with the relationship between the government and big tex, democrats are in the Congressional District in Silicon Valley. What do you want to hear from this companys next week . What have they done to address the concerns, today we had facebook announcing that they are changing their algorithms so that we dont have people being exposed to paul spread advertising, what other have they done, thirdparty verification . Are the increasing investments to we do things out . Are they hiring more reviewers . I think they have to be transparent about what went they are what steps taking. What has been unsatisfying about the answers they have heard so far. I think they were slow to a knowledge a mistake, what they should have said is when you have new technology, inevitably, people use that technology, the systems were exploited, we needed to do better, these things happen when new technology and we will eat taking corrective action. I think it took too long to get there, think there was defensiveness when they were first confronted but i think is that they have been more transparent, i think the tone has changed. I think you recognize there is a problem. Quite a few see it everyday response from goal, facebook and twitter . It is funny you say that because anytime i talked to some of these companies they say we will do well but it is the other companies that are messing up and i said that is not how people around the country or on capitol hill look at it, they will not have the finer points of google, facebook or apple, they do this as a tech challenge or a Silicon Valley challenge and everyone is going to be painted with a brush so i dont think it is worth getting into is doing better, i think they all have to do better on Machine Learning and having more human review. Regulation it is necessary here when it comes to monitoring online content or policing how these companies monitor online content . I think there is room for regulation, the regulations about disclosure of political ads, there were a lot of heads we didnt know was paid for them. There may be some regulations needed about know your customers and making sure they know who was advertising and making sure they arent monetizing advertisements that may lead to inflammatory content but a lot some role for congress and selfregulation and standards these Companies Need to do in obtaining the terms of service and their own standards and guidelines. We are coming into elections, what are your concerns with another election season upon us and many of these changes, if theyre going to be made, not yet made. My hope is that we wont lose the positive of social media. There were so many candidates, barack obama, bernie sanders, distant voices that were able to use social media as a platform to get their voice out so there was a lot of good, unfortunately it was also abused by propaganda hate speechech and that was terrible toward minorities or women, how can we fix that without censoring the good parts of the social media, how can we have that balance and i think the companies over the last few months have been working toward that, they dont want to censor the platform but they do it to remove the offensive content. There has been concern about the impact of some of these platforms on children, the idea of facebook addiction, online addiction and these Companies Might be perpetuating that, do think the person is fair . I think is is always the case, i want my son watching television, he is six months old and i try to keep him away from the phones so anytime you have television or new technologies, you have a concern, you want kids reading and playing and having interactions but what i think is important is that these companies have other rhythms that encourage engagement, it doesnt just encourage passive learning and that is what withook has been doing their recent steps, they have been saying their algorithm spends less time online but be more engaged and their stock took a drop because this beta figure for business but it may be good for society and i am glad they took those kind of steps. How would you describe the glacier between Silicon Valley and washington . In the last demonstration there was a much cozy relationship, someone say to cozy and there is a greater divide down but there is also a risk to that. I think it is complex, on the one hand, every person would love to have tech in their district and saw this with every congressman and senator betty for amazon, they associate Silicon Valley with the future, prosperity, they were those jobs, they with the technology. Isaiah rogers refers to his region, there is a aspirational quality to Silicon Valley, on the other hand, they have seen the abuse of these platforms, there is a concern that social media is perpetuating most propaganda or inflaming them and they want to make sure these levels are on abuse. As the other point out, our Approval Rating in congress is at 11 . Emily thank you very much for joining us, bridget have you here. Good to see. I reminded that bloomberg lp, the pen, and a Bloomberg Television produces a global breaking news network for twitter. Industry ishe tech still trying to assess the message of vulnerability last week, we discuss how the flaw could weaken the relationship between intel and microsoft, next, this is bloomberg. Emily this was a 30th percent thirdquarter profit surge, is coming on a tax benefit and investments in Digital Technologies for the Indian SoftwareServices Company but the new ceo maintain forecast for slowing sales, is the first earning announcement since they took over the job last week, he assumed the reins after a board room tassel that ushered out vishal sikka. Were handinhand with much of the pc era but news of the vulnerability of the intel processors has driven a wedge between the two. Fourseamer gorsuch to do much of the work to pass security. Authorities are disagreeing over the extent of the possible disruptions to customer operations. But bringing alex. Quite what this means for my result is that they have a chance to continue to show their customers that they are their partners. This helps transition customers to the club, i feel be very important, we have seen fabric be it in relief secure. Learn abouts that these vulnerabilities in january, countries like microsoft have had this information, and done a great expect overall, but we is this will drive more customers to go to the cloud, not less. So how much does this hurt microsoft versus intel . It doesnt hurt microsoft all that much, our conversation suggests that the company has been really good about using Software Workarounds to address some of the potential performance issues on their cloud business, in the scenario where that is not enough and accepted by more capacity, that could impact margins but on the positive side, this performance issues could be more pronounced in order systems, you could see a pc refresh cycle. That could be a good thing for microsoft. What does this before the relationship between microsoft and intel . I think microsoft and intel have had a strong relationship for a well, i dont expect this to really meaningfully impact it one way or the other, i think that over time, as the hyper scale cloud vendors like microsoft and amazon have to differentiate more of the cloud pursueund ai, they may more aggressive paths to design their own chips and all that part of the infrastructure stack. I dont see this an issue to microsoft outside of what we have talked about. How farreaching do think this security flaw is, what actual impact do think customers will see . We think it is very barbiturate, our conversations aninitely pointed as being issue they are looking at, we are not seeing any overreaction on that front, we have talked to doingies, they seem to be fine from a performance standpoint, they have been able to write workarounds and there are certain benefits around, architecture that allow them to mitigate some of these impact. We personally believe this is going to drive more clout adoptions. If you are a cio and your waking up to this january 3 leak and you have to deal with your idea organization patching or making updates, are you in a better position than microsoft or amazon or google that have had the opportunity to do this for six months and as Companies Like them continue to push customers to the crowd, this is going to be another reason why. What is your outlook . Howtex has been on a high, long can this keep up, it still keeps going up with some volatility here and there but what do you think the general trend will be . Topic,ade microsoft the last year was a real catch up in terms of the race the 20 microsoft and amazon, we think this year there is a lot more advanced computing workloads, we think my result is really wellpositioned on the Software Side and enterprise, both of the structure side to partner with their customers and drive much larger deals at much better margins which will lead to much better cash flow so we think that is getting started, is a generational shift that microsoft is at the heart and soul of, so we really like it, that is the short answer. Great be here. Coming up, i. E. Worried about your childrens smartphone screen time, some apple shareholders are. If you like bloomberg news, check us out on the radio, this is bloomberg. Alisa i am a Alisa Parenti in washington. He is a check of your first word news. The u. N. Human Rights Office as president trumps reported use of an expert at to describe african and other countries can damage and disrupt the lives of many people, speaking in geneva today, robert said trumps comments go against unit the universal values the world has been striving to establish since world war ii and the holocaust. These are shocking and from thecomments president of the United States. Im sorry but there is no other word one can use but racist. President trump denies he used foul language. Richard durbin was present in the oval office when trump made the comment. You have seen the comments in the press, i am not one read one of them that is inaccurate. To no surprise, the president started tweeting, design that he used those words, it is not true, he said these hate things and he said that repeatedly. The chairman of the Congressional Black Caucus said the president s statement reinforces concerns that we hear everyday that the president s slogans make America Great again is really good for make America Great again. President trump has canceled later to london to open it will 1 billion u. S. Embassy, avoiding the protest promises. British lawmakers had trouble is now open that after he retweeted videos from a par} group and criticized london mayors following a terror attack last year by the president said his decision was due to concerns said his embassies decision was due to concerns about the embassies move from the mayfair district to a less fashionable area of london. Turkey is warning its citizens about traveling to the United States in a tout retaliation advisory u. S. Travel that one americans about terror threats and arbitrary did to tensions in turkey. Country says the u. S. Travel wanting unfairly portrayed turkey as an unsafe country. Ofvenezuela, two days protest and loaded over Food Shortages have left people dead and 16 injured, cattle business say at least two farms were attacked by moms of people slaughtered cows and opposition lawmakers posted a video on twitter showing a dozen attacking one count and one says we are hungry. The Europeans European Commission president is luckily the Coalition Agreement that was formed in germany, speaking to reporters in sofia today, some club ok john claude called constructive. Global news, 20 were hours a day, powered by 2700 journalists and analysts in 120 countries, this is bloomberg. This is uber technology, i am emily chang, turn to our top story. This is major change to the platforms new split. This may cause a huge problem for publishers relying on facebook for its large user base , Bloomberg Intelligence joins us now with more. How do think this will change the facebook experience . Good thingit is a because over the last couple of quarters, if you see the total time spent on the platform, it has been going down. More people are lying on instagram and this issue of Marketing Content and family content, they sing this issue is great for longterm, in the near time nearterm it will be an impact on revenue. We feel instagram can handle the offset that they need to continue growth. How do you think this will materially change how we experience facebook . Will it feel like different . It should feel that but facebook was first out there with respect to all your friends and family and content that way and hopefully that helps them fight the fake news issue a little bit and from a publisher standpoint, what you might see his produced content and information on facebook and they might have to rely more on alternatives, they might look at twitter, snap, linkedin, publishers are the ones where the risk is higher but some from a facebook effect standpoint, i think is to record help them upset this. Offset this. Emily how much do think this will impact the bottom line . If you look at instagram, the revenue was supposed to double this year. So expectations are on 8 billion and that should help them offset some of this. The other thing to keep in mind is pricing. Zuckerberg has said it is more about quality of time and not quantity of time. So as pricing increases, we can see what type of messenger this is. They have not figured out these. If you can some of these things, it should be a slight impact. That you for your analysis. Sticking with social media and screen time, are such things actually fostering a Public Health crisis for kids . Thats tonight will is what to apple shareholders seem to think. They say there is a wrong body of evidence that for some of the most frequent users, they may be having unintentional they the consequences but there is also a growing societal unease about whether some people are getting too much of a good thing when it comes to technology. At some point, that is likely to impact even apple. Andke to welcome jim stop the founder of common sense media, a nonprofit that provides information and advocacy to families and technology. What you make of the claims that the shareholders are making . They are correct, they are absolute correct. There is a huge issue today and it is a Public Health issue about the nature of cell phones and like facebook, the Previous Story you were reporting on. That to my cell phone use for ourselves is a problem and so they are absolute correct in calling this out. Part of the problem is we dont have a longerterm where we have been using smartphones so that we can see the effect, i know you guys do a ton of research on it, what have you seen about the actual effect on children . Overr Research Shows that 50 of young people feel they are addicted to their cell phones and over 60 of parents think they are addicted. I think the other thing is that you can see there is an arms race for attention, your producer about how facebook was to spend more time on the facebook platform. Also does netflix, so does instagram or snapchat and so the issue is how much time you want your kid in front of the screen. And our Technology Companies intentionally built devices and software to make your addicted and that is a very big issue so i think it is very important when shareholders call out Large Tech Companies about their responsibility because that is what this is ultimately about, it is about the Tech Industry, whatever the company, taking responsibility for the health and wellbeing of their consumers. What are the Tech Industry do . They can say we make these products, we can change an impact how you use them. Three things, one, they should change the design, youre just doing a story about how facebook is redesigning his platform. The Tech Committee should be redesigned their platforms to make them was addictive and urge you to take time off and not spend 24 hours looking down at your phone. Emily what is the incentive for them to do that when they are running a business . Your and my lives. The fact that you have a broader value than just shareholder value although in this case, shareholders are calling up companies asking them to do more. I think the second thing is that we spend under lien and a half years alone on research and that is a tiny fraction of what should be spent but there is almost a lot of money spent on these issues. So we should be researching the impact on brain development, mental health, etc. The third thing is, in apples case, this should be a Publication Campaign that is focused on here is how you use the device wisely and in a balanced way. So i think this is a clarion call to the Tech Industry, brother that your users do love your product, they provide a lot of benefits but there are serious consequences here as well and you need to be responsible and accountable for the downsides as well. That is a positive message, particularly about kids and families and common sense. The statement you made about sean parker, got only knows what it is doing to our childrens brains, this is talking about facebook and social media, the thought process that went into building these applications, facebook being the first of them, it was all about how we consume as much of your time and conscious attention as possible. You wonder if you are the person that is building this business, the people that are building this business, how they can make a compromise that would actually be worse for the business. Is a thing, all good businesses dollars Public Interest with their bottomline profits, Mark Zuckerberg just talk about his two Young Children and how important it was that he build a society that was good for them. About softwareng for your children, that is a day of reckoning, whether it is sean , ink and some of the more addictive these are things that need to be faced. At common sense media, we are happy to work with Companies Like apple or facebook or google to change the way that they both design upon us but also urge their users to use them in moderation with balance, at the end of the day, you are a mom. To grow up kids taking advantage of the technology but also not being that ultimate sons who are addicted to and controlled by Technology Platforms and there is a balance in the middle which is where we should be heading as a society and with the Tech Industry, having the responsibility to let us go. I also have a question about youtube and youtube kids specifically, there was a very well done medium article about some of these videos being suspect, some of them seeming to have no point like that is that surprise children by opening incredibly long, license up cap uptake. Peppa pig. What do you think you two should be doing about these . That is a great question and since the story came out with susan who runs youtube and the other people who run that platform, youtube is the biggest pain point they have because of the fact that kids run into many unsuspected surprises on you to, including the youtube kids platform. What they are doing is devoted a lot more human resources, and in hiring a lot of people to combat platform and make sure that there arent inappropriate surprises, here is the deal, in a world where all rhythms as opposed to human beings and values, you run into a problem, i think this is the beginning of a much larger societal discussion. Whether it is facebook, google or any tech company, as the bells between the best, coolest, passive technology and profits with what is in the best interest of humanity. That is a very important conversation for all of us to have. Common sense media ceo and founder, taking so much for joining us, jim. Is bostonbased company trying to change the effects of agriculture and the impact on environmental and human health. How indigo plant on doing this with the latest funding round, that is next, this is bloomberg. The u. S. Trade Representative Office has put alibaba on his notorious markets list for selling counterfeit products online. They said the actions are insufficient, the decision is considered a blow to alibaba plus gogol global expansion. Reflect the protection efforts and cause the u. S. Process deeply flawed televised, and politicized. The bostonbased hybrid cultural tech form is dedicated to helping them sustain the planet. The Company Works to apply natural approaches and grow healthy food. Million in a 47 funding round of this after 156 milling dollar grant to push the company to a unit or status in late september. So how will the indigo use these funds . , joining us now from boston, david perry, thanks a lot for joining us, how will you use these funds . During the business broadly, a lot of votes will be increased r d spending. The carved core of the company is microbiology and applying that to agriculture and a lot of our investment goes into r d spending. Alisa talk to us about how the technology works. Sure, microbes evolved with plans overtime over hundreds of doing to beers to help those plans by our stress and that could be helping them feel that it would lack of water or it could be helping them resist attacks. Modern agricultural practices have decimated a lot of those beneficial microbes. This is by the abolition of application of pesticides. It discovers those microbes that were originally evolved to help plant. We add them back to plants so plants yield more and need your chemical particle eyes chemical fertilizers. What is next . What is the hope . We are ableis that ,o grow agricultural crops improve yields in order to be able to feed our growing population and do so in a way that is more environmentally sustainable. So we use less of our freshwater supply, we have less letters and runoff in that one supply and we create your Greenhouse Gases through the abrogation of chemicals. Explain how all of this factors is your business model. Microbes to coat theseeds and most of modern agricultural crops, this is going to the run. These go and get taken up by the plants, they multiply when the the plant and produce positive impact on the plan. We shall both treated seeds which improve the plant performance and we contract with farmers to grow more sustainable crops at a premium for the farmer so the varnish for money and we are empty cell is to people who are interested in more sustainable sources of food and fiber. How many crops do you plan to offer . The five largest crops in the world are corn, wheat, soy, cotton and rice and that is the five we started on, we believe this technology will work on major agricultural crop and we expect to expand over time. Was david perry, thank you very much for joining us. Coming up, we wrap the biggest trends in las vegas, what you may have missed, next, this is bloomberg. Alisa vottos fund is said to be investing in financial tech startups, the private Investment Firm is backing acorns grow, the stock investing at the last client that have less than 500 on average to invest in eps and managed copies like vanguard and black rob. Ashton kutchers sound avengers and kevin durant are also acorn backers. Been bloomberg has been live at the show in las vegas. From aring new gadgets headsets, lasses and vehicles. Whatattended the event, did you set out question mark that was the talk of the town but in all seriousness, it was basically, the reemergence of virtual reality, were both at cs about the ins and outs of the our nar, br we looked at it as a dime platform over the last year but now there has been a shot in the arm, oculus has this 200 headset that is going out in a few months. Same time, in the back room deals, we have apple, snapchat, other chinese makers, lenovo, samsung, lg, google, any company you can name, amazon, theyre all working on ar headsets but those are years away, that was the backdoor talking. Products donds are think are the most promising . Augmented reality, everyone you talk to who understands technology and where the industry is going recognizes that vr will be a niche player, a very successful niche player until augmented reality comes down the road and becomes a Successful Technology on its own. We are releasing the very early stuff, the underpinnings of what is to come down the road. It is a big, open question, how much will a are change our lives and how we experience the world. Dream of these companies, amazon, apple, google, classes that are as lightweight as what you would wherefore reading or anything else, it has cameras and a front, i can look at you, get information about you, your Wikipedia Page and then i get a text message, or a phone call, i see very much google west island but cheaper, lighter and more effective. What about when it comes to connected ones . I know that is a big scene, what you see on the horizon in 2018 . Been, this was the Car Electronics show, there were a lot of booths related to cars, toyota announced that they partnered with alexa to have a dashboard populated by a lecture alexis optionality. I think what we was he is google assisted functionality and optionalitye corp. In other carmakers vehicles, apple has car play, that we have alexa and android auto, this will be hundreds of different cars, you have android facing your car, you have more of this technology so think ive for the third or fourth year in a row, it will be the connected car strategy. What is to come in 2018 . What are marker men looking most forward to . It will be interesting to see what apple does in the. They pioneered this back in 2014 but i think they have since blown that lead to both amazon and google, who had this home pot delay. In the home pot comes out, we will see if the conversation backed to appa apple be on top. Im really excited to see and we will find out what they have up their sleeves because they have to be doing something in the connected home market. Alisa thank you so much for that roundup and your great covers this week and surviving the blackout, thank you, i know it was not painless. That doesnt for this addition of bloomberg technology, we are Live Streaming twitter, check us out on technology, ive p. M. On the art, 2 00. San francisco, have a wonderful weekend everybody. This is bloomberg. What was the strategy that you used. I was determined to recapture my Parents Money that i lost. How do somebody raise 5 billion question mark you have an image of being a person that strikes fear in a lot of ceos, some people afraid that they will get a call from paul singer. , if some of the investigated what rate of return with a have compounded . People without recognize me, was livid this way