Give truckers more time at rest stops . First, to our top story. Wework says job cuts will start this week. The struggling Office Sharing startup said that cuts will improve efficiency and accountability. Bloomberg has learned that about 2000 jobs will be eliminated, some 16 of weworks global workforce. Ellen huet joins us with more. What do we know about these layoffs and where it fits into their broader strategy of slimming down, if you will . Effort that has been going on in bits and pieces but it sounds like based on this new memo that the executive chairman sent this morning, it is going to start in earnest in the u. S. This week. They had already been starting to have some layoffs overseas and there have been some cuts in side businesses like meetup and other side businesses they owned, but it seems like maybe this week is going to be the big time. They had originally scheduled an all hands meeting for tuesday and another part of the memo says the meeting will be moved to friday. In order to, i think, give time for all of the job cuts to percolate through the company this week. On friday, we expect an update on the fiveyear plan of the company. Taylor do we have any update of what that that fiveyear plan will look like . Ellen if it is anything like what is talked about in the memos, it will be similar to that path that is trying to focus on the core business and adding back to profitability. That has been the repeated goal. I think its easier said than done, this is a business that even if they managed to make the right cuts, they will be suffering from employee morale. This has been a really hard few months for we work employees who felt in june or july were on the brink for a successful ipo and now the company has seemed to go through a 180. Many people who, even if they are not going to be cut this week, are choosing to leave. Employees have told me that a lot of people dont show up for work, are openly taking interviews elsewhere. There are people who want to stay but others who feel like it is on shaky ground. Taylor do you get a sense that the 16 , the couple that could thousand start to be getting laid off this week, is that within weworks Office Sharing business specifically or does that also include some of the side businesses you were talking about . Ellen it probably will include side businesses. I think the total number will be up to a little massaging. There will be some Side Companies that are probably expected to be shut down. It also gets a little bit complicated. For example, many of the cleaners at wework were inhouse employees for years, called Community Service associates and other titles like that. Those workers were inhouse for years and it seems like they will be slowly transitioning to being hired by an outside contractor. There is some job shifting going around so that final number of layoffs may be hard to pin down. Taylor it is interesting that you mentioned the ceo and that all hands letter. Because there have been rumors circulating about a new ceo, john legere, who we have learned today will be stepping down from tmobile in 2020. His name in the mix. Why this shakeup . Ellen they have these two coceos who stepped in after adam neumann left. Even though the company said they were not initially going to start another surge, it seems like softbank and or maybe the company as well are starting to ask around and see if there is someone to take over. I think they recognize it will be important for someone to step in with a lot of confidence, ability to set a new course for leadership. It has been so shaky internally since then. They had marcello step in as executive chairman. But notably not in a ceo role. I think the expectation would be that he would work alongside whoever ends up becoming ceo. I am sure this is a search that weighs heavily on the minds of the board, executive trying to find the right person who can lead them out of this tumultuous period. Taylor boosting employee morale can be so key to that strategy. Thank you, Bloomberg Technologys ellen huet. When alphabet started looking into acquiring fitbit, it turned to a familiar name, lazar, the Investment Bank that goes back to the 1800s. It can count on the Silicon Valley giant as a surprising and steady source of business. Joining to discuss is bloombergs leanna baker. I have to ask, why the googlelazard partnership . Leanna it goes back to a decade ago when one of lazards investors, known as being a confidant to bill clinton and d. C. Insider, had a relationship with googles top lawyer, david drummond. They made the connection and it has been history ever since. Google has been advised by lazard on over 22 billion of deals since 2011. They have quietly become googles house bank. Taylor we have learned they recently acquired fitbit. What are some of the deals they have been an advisor on . Liana lazard has stepped into advise google on its most transformative deals. Whether it was nest a few years ago. It started with motorola, almost a 10 billion deal in 2011. They have also been on a looker technologies deal earlier this year that we are waiting for approval from d. C. On. They have done smaller deals. Lazard is on retainer with google so they dont just advise on the largest transactions. They are paid a retainer fee and , about 200,000 a month, and they will weigh in on anything google is looking at. They did advise google when they looked at twitter. Not every deal that they work on comes to fruition. Taylor any sense of how all of those fees you pointed out stack up into lazards broader Business Strategy . Liana according to consultants, lazard has only made about 70 million estimated fees from google. That is not make or break for lazard, but it is this sort of repeat business and Investment Banking that the boutique has come to rely on. They have been in a bit of a shakeup. One of their top bankers left in france a few weeks ago. As you mentioned before, their market share in dealmaking is not what it used to be. Lazard has a ton of rivals that have taken a big share. In Silicon Valley, there are several. Lazard is almost 180 years old but they now have competition in this independent advisory space. Taylor within that Competitive Landscape that you just highlighted, how dependent has lazard become more and more on those Silicon Valley giants, on those repetitive clients that they do have that seemingly permanent relationship with . Liana they have some big names like ibm. But working with google, some rivals of lazard have said maybe they are conflicted out of working with other tech giants. Working with google on every deal, they may not be able to work with, say, apple or facebook. So they are kind of planting a flag on this relationship and they are committed. That is what google likes. They like the secrecy, that they like how lazard is behind the scenes. Until now, they havent really been in the headlines connected to google. Taylor thank you for joining us. The state of california has sued juul for allegedly marketing ecigarettes to teenagers. Authorities say the company sought out vulnerable targets for its products. Juul has become a target of government regulators trying to stop an epidemic of new, young nicotine users. Coming up, waiting in the lobby. Facebook and google spending big to keep regulators at bay. We break down the washington tactics next. If you like bloomberg news, check us out on the radio, the bloomberg app, bloomberg. Com, and in the u. S. , on sirius xm. This is bloomberg. Taylor now to a story we are following, the continued pursuit of big tech by the u. S. Government. Senator josh holly of missouri has introduced a new bill aimed at protecting american data from being acquired by countries deemed to be a National Security threat. For example, the bill says tiktok could not collect user data deemed unnecessary to its business and transmit operations within china. Joining us, bloombergs ben brody and kurt wagner. Let me start with you. What are your thoughts on this bill . I think this represents lawmakers continually feeling that they have to grapple with chinas tech ambitions. And the possibility they could really be setting the rules for the web not just in china where there are one billion plus people, but here in the United States. Do they set the content rules on tiktok, the surveillance rules . I think this is a response by hawley, and he had that hearing where he was very angry with tiktok and apple for not showing up. Youre seeing this question through the government right now. Taylor is this the kind of protection that big tech wants that Consumers Want . Kurt probably to some extent. We have seen facebook in particular but google and others push for regulation. What they really mean is they want to be involved in shaping the regulation. Can have some type of guidelines or rules written down where they can follow those and that solves all of their issues, that looks good for them especially if it keeps potential upstarts or startups from catching up. They have such a strong advantage. Tiktok is obviously a threat, i think, to facebook. If there are certain regulations that might facebook a little bit, but if they hurt foreign competitors like tiktok, they might be on board. Taylor we have you on a day where there seems to be more and more propose legislation coming out. We had a headline today that the ftc says they are looking at multiple antitrust probes underway and that they will review all of these antitrust laws in the wake of these big tech probes. Does this indicate that the size and scope is bigger than we saw before . Ben i think, absolutely. We know that the federal trade commission and Justice Department are doing these wideranging probes into digital marketplaces and they are all doing google, facebook, amazon, and apple. We know the doj is formally looking into google and facebook, we know the ftc is formally looking into facebook. Facebook is subject to both of them right now. What we dont know is whether they are doing those other companies. I think the chairman raise the question today that they may be doing all four of those, maybe two or three. If i were an investor in the company, i would be looking at the question of how intense that scrutiny has gotten. Taylor does this meet the level of the bar that needs to be set in terms of doesnt harm competition . When you look at all four of the Big Tech Companies that could potentially be in play. Kurt facebook has talked about this the most. Primarily because we know about those investigations and theyve talked more openly about it. Their argument has basically been none of the accusations are really about harming consumers, that we are being penalized because were big, and that is our only crime. That will be a question we will start exploring, i am sure, as investigations move forward. In the targeted advertising field, when you have facebook, google and amazon getting into that. When you talk about app stores, google and apple having these really dominant app stores. It is tough to say who is being harmed in what way but those are the ultimate questions we are looking at. Taylor i was looking at another story about google and facebook donating to privacy groups and think tanks, and this sort of extends their reach beyond just traditional lobbyists. Lobbying, we understand, sort of a normal course of business. How much does it concern you now that you see big donations from facebook, google, and the like, to these privacy advocacy groups, think tanks, that in some ways appear to be neutral . Ben i think that is exactly the point. This is not traditional lobbying. This is about shaping the narrative, shaping the conversation somewhat as it goes to the public, but also as it sort of appears to the washington class here among reporters, staff, lawmakers. It is always the concern, going to an event, a talk about how balanced is this, who is presenting, do we know their biases . What is disclosed about it . It is always a part of how everyone in washington is weighing the policymaking process. I think these groups will often push back and say, we have lots of different corporate donations and sponsorships, and we put forth the best solutions we think we can. Some groups are even more forthright and some groups are largely captured by these companies and essentially putting forth their agendas in shadow lobbying. Taylor when you were looking at some of the think tanks, companies we know of, cato institute, access now, center for democracy and technology, what stood out the most in terms of the size of the donation and influencing them . Kurt what stood out is it is hard to exactly say because some of these were hundreds of thousands of dollars, some of these were as low as 10,000. What does that really buy you . I think when it comes down to it, this is a play about leverage. This is a play about relationships, as with all of these kind of donations ndc in d. C. You want to be able to make a call to someone, get your point of view across. When you have that existing relationship, it is probably easier to do that. It is a little bit tough to say exactly how much the dollar amount, you could almost set aside. This is about building a relationship with people who have the ear of the media, the general public. Taylor another day, another big tech and focus here. Thank you to bloombergs kurt wagner and ben brody. Coming up, we talk investing in enterprise startups. A Firm Announces a 157 million funding. Bloomberg technology is livestreaming on twitter. Check us out technology. Be sure to follow our global breaking news network on twitter. This is bloomberg. Taylor just eight years ago, new yorkbased venture firm bold Star Ventures raised funds. Now it raised 157 million across two funds. Both tomic Enterprise Software startups. The news comes just days after softbank announced 2 billion funding for its Second DivisionSecond Vision Fund, also focusing closely on enterprise startups. For more on the latest funding, we are joined by Boldstart Ventures partner ed sim. As you look at the landscape with these new funds and fresh capital where you see the best , opportunities and where to invest . For us, its about the digital translation of the fortune 500. If you think of every fortune 500 as a software company, from Cloud Computing to a Developer First atmosphere is an awesome opportunity to invest. Secondly, if you think about it, salesforce is over 20 years old. Tech changes so rapidly, so the opportunity to reinvent and rebuild parts is super impressive. Companies like kustomer are going after zen desk and Service Cloud in a pretty impressive way. Funds focus ono different companies. One is transforming existing companies that are already in play. Between those two, what has been harder to raise money for . Definitely the early stage portion. This was kind of our first Institutional Fund and it took us time to play out. In 2010, we were the First Investor in technical enterprise founders. A lot of our Portfolio Companies have gone on to raise over 100 million since we helped get them off the ground. Eventually the Institutional Investors paid attention. The Opportunities Fund was easier because we can point to those Success Stories and opportunities to invest in future rounds and they had real metrics, versus the prior fund was more about vision. Taylor what question are the Institutional Investors asking you the most when they are handing over capital . Ed they are asking how you frame investing into people and an idea . We are trying to help them understand that, for us, it is about foundermarket fit, realizing things that already exist or have new categories. Walking them through the framework about how we think about the product perspective along with large enterprise. Taylor i have asked this guests and a lot of i have yet to get a solid answer. That is, at what year, on average, do you want to see profitability from these companies . Ed i have to tell you the truth, when we invest in companies, we are only investing in Enterprise Software companies so from a gross margin perspective, we dont have to think about what that would be because it is high gross margin. From a profitability perspective, we dont invest to think when this will be profitable, we have to think when the total gross margin is potentially massive and if the founders in the beginning can execute on product. They need to focus on building the best product, finding the first user and dozens and dozens of users after that. If you focus on that first in the beginning and have a great product, you will be able to win customers. Taylor softbank recently was looking at raising their Second Vision Fund and they were looking at Enterprise Software. How overvalued is this space now with too much cash chasing too few opportunities . Ed that is an interesting and leading question. I frankly think there are some companies overvalued but we are still in the second inning. If you look at Cloud Computing space as a percentage of overall i. T. Infrastructure spend, i think it is about 10 . If you take that number and look at the next five or 10 years, i think no matter what Economic Cycle we are in, there will be lots of opportunities for enterprise technologies. Whatever the value is today, i still think three or four years from now, we will be in good shape. Taylor how much is softbank a threat, seeing how overvalued Companies Like wework became . Do you fear that comes into your area as well . Ed there is always a risk of companies being over capitalized. I was on your show in august talking about money is not the answer to winning. You still have to build a solid business, have a balanced growth versus growth at all costs. I think with wework and consumer Type Companies you wont see , that in the enterprise space. I think most enterprise advisors are more practical. Its hard to just turn on the spigot and spend money and grow. There is lag time of selling into these large enterprises. Taylor Boldstart Ventures partner ed sim, thank you for joining us. Coming up, apples latest iphone is scoring early success in the second largest market, china. Why shipment growth is up while trade tensions between the countries amidst trade tensions between the countries. That is next. Taylor this is Bloomberg Technology global link where we join daybreak australia to bring you the latest in global news. Paul allen is in sydney and Kathleen Hays in new york. Lets look at those stories. Taylor i will start with softbank. They plan to combine yahoo japan Internet Business with messaging service. That will become a joint venture in a deal that will not close until next october. Andcombination is driven global giants are increasing their hold on the tech industry. Down. Le ceo is stepping he will stay on the board. The move is a long planned transition. Mike sievert has been the brains shind many of tmobile popular initiatives. The board of has rejected the takeover from xerox. The bid is too low. Hp says it is open to exploring a merger, but there are fundamental questions that need to be answered. Todayse a look at global tech stories. Chinese consumers are rediscovering their appetite for iphones. Numbersg crunched the to see that apple has shipped 10 million iphones to china. With a 6 increase from a year earlier, that confirms the iphone 11 is selling more strongly than its predecessor. What is driving the demand. That is a good question. This is an upgrade cycle, people coming from the iphone x. Last year the iphones were considerably not big upgrades, or too expensive. Prices were very high with very little additional features. Now there is a more significant update. It makes sense that improvements downminimal would be compared to this year. It looks like they worked on the battery life. Give us more details on what it means to what they have to do for the future . Camera. Upgraded the there is a triple lens system to take wideangle photos. Orstead of a photo being 1x 2x, you get more content in the frame. Life, itional battery is popular. Ways they are doing the upgrades. They are making money in other ways too. I was surprised given the trade fight, they were not buying huawei phones to retaliate against the u. S. Is there a sense of nationalism when it comes to phones . China thenerally in iphone is not doing as well as it used to do. We have not had large gigantic iphone sales that we used to have. 20142016 was the peak of the iphone in china. That forr issue is consumers in china in many cases, the offerings from huawei are more capable and integrate better with chinese consumers. That is the issue, not the trade war. Do . Hat do they have to they are not luring chinese consumers away, but when you , but dothe next year they need to do . They need services that are specific to the chinese market. What people do not understand if you do not live in china is that it is a different world. Much anne is a very american device. In china, with the functionality they have, apple needs to better integrate with those services. When you need to come to competitors to strongarm the chinese market. Where does apple forecast their market share in china in the coming years relative to huawei . Where do they forecast . They do not give forecasts on specific markets, and they do not forecast iphone unit sales. They talk about their overall forecasts for revenue. In terms of the chinese market, it will be stable and you will see between 5 and 10 yearoveryear increase similar to what we saw from september through october. It will be more of the same. Selling the iphone is 9 yearoveryear in the previous quarter. Taylor thank you for joining us. We will have a lot more when we come back. This is bloomberg. Taylor the public is waiting for driverless vehicles, but waymo thinks there is a part of the market that will get rolling first. The ceo told reporters before we see robo taxis, it is most likely to be driverless trucks like those waymo is testing in california and the southwestern United States. Joining us to discuss in half waymos, california, chief officer. We see driverless trucks will we see driverless trucks before taxis . Excited about the trucking opportunity. The line of demand for it, there is a foundation for the economy. We have been working on this since 2017 and we have done a pilot with google. We are shipping data center parts. Generalhow has the rollout been going in phoenix and shoot driverless vehicles . The rollout has been going really well. I am excited about our progress. We started in 2017 and had 20,000 people sign up. Nowadays we have thousands of riders. Over the past few months we have phoenix who can hail a ride and have a car show up that has no driver, and take various trips with us. Taylor when will we see a bigger rollout nationwide instead of in select cities . Globalefinitely have ambitions. Our mission is to make every mile safer. We want to get everywhere as soon as we can. We think the rollout will be city by city, incremental. E will expand from the next we have driven in 25 cities and are testing in new ones. We recently started testing in miami and los angeles. Oneor have you written in and what is it like have you ridden in one and what is it like . I have, it is part of the culture at waymo. It is an incredible experience. It brings that bit of independence about privacy, that time to yourself. It is a whole new product. Taylor how quickly or how much have concerns over safety forced you to slow plans where safety is more of a priority . We have always had an approach of launching this incrementally. That is the most safe and responsible way. If you look at the history of our projects, we had the first self driving ride in austin, then a fleet of vehicles in 2017, then our waymo one launch last year. We have been doing that incrementally for a while. Taylor when can we expect to see driverless delivery . We definitely are excited about the number of applications of what we call the most experienced drive. As we talked about, we have ride hailing, long truck hauling, and delivery as well. We are interested in cars. Our partners are interested in that as well. We will roll those out over the course of the next year. Taylor the Technology Behind us has been difficult to get up to this point. There have been a few setbacks. Why is this the best use of your technology . Convinced around the social impacts and benefits that Self Driving Technology will have. We will look at road safety that is core to the mission of waymo. 1. 35 million lives are lost on the roads every year on a global basis. As one of the leading causes of death, and even in the United States, that number is going up. Over the last five years it has increased, so for those reasons road safety and other benefits on the environment is definitely the right focus. Societalithin the impact, what do you say to people who say you are taking jobs away from taxi drivers . It is an important question, as things change in the world changes, we want to be part of the solution. One of the things is that this change will be incremental. It will take time to rollout. We want to be part of treating jobs. In phoenix we are seeing that happening. We are creating categories of jobs that never existed before. Technician. V the other thing that is not discussed is around how mobility is an important part of employment. Giving people access to jobs is how they will get those jobs. In the United States, 20 million to 30 million adult americans licenses, soivers between the creation of jobs and getting access, those are ways we hope to be heart of thi the solution. The techttending economy conference, the founder of wpp. I spoke with him earlier to get his views on political ads run by Tech Companies. Any medium is responsible for the content that flows through their pipes or on their pages or on their screens. The basic question is whether Tech Companies or Media Companies in this area and other areas, or whether they are Media Companies, that is the big question. I did an interview at cannes 10 years ago and had four Tech Companies including google, facebook, microsoft, and the first question i asked, are you Tech Companies are Media Companies, and they all said Tech Companies. We know they are responsible for their content, and to be fair, those platforms have moved their model. 10,000 people,d facebook has 30,000 people to monitor the content. My view is political advertising yes as long as you monitor the content and make sure it is statistically correct. And that it is not misleading, just like you would see in the u. K. That the content is monitored for inaccuracies. Wrong too facebook is run political ads but not Fact Checking them on their platform . My view is you are responsible for the content. As i said at the conference a few minutes ago, you cannot claim you are digital engineers and not responsible for the information that flows through the pipes. You have to take the spots ability, and to be fair i think generally in on one particular area, political advertising on facebook, you see it in the results, their margins by costs are being affected the fact they are taking on people to monitor the content in a more responsible way. They have moved the needle significantly toward responsibility. Is end of the spectrum responsible, and the other end is irresponsible. Taylor should they be under review . Are these companies and expansion of the Chinese State or not . The questions are raised in the context of huawei and its connections to the pla or not. They say they are disassociated from the government and the pla. Do i think it should be subject probably not, because i do not think they are the threat people think they are. Question for huawei, it is about whether we in the west are prepared to accept the rights of china. Taylor still ahead, ford is entering the electric Vehicle Market with confidence as it introduces its new batterypowered mustang. That is next, this is bloomberg. Taylor lets take a look at todays top tech calls. Analysts said there was a clear path to profitability. The analyst is incrementally and ave on lyft shares, clear path to profitability. Salesforce Analyst Group optimistic with several firms been updated target by the software company. The price target was raised to 195 per share and they expect management to balance revenue growth. Tmobile ceo is announcing plans to step down in may of 2020. It is not a big surprise, according to analysts. He believes the successor will take a public role and has a strong track record in the wireless space. Ford is reinventing one of its marquee models. The mustang muscle car has a batterypowered crossover. Ahead of the los angeles auto show, the carmaker unveiled the mustang. Confident in the profitability. We have a price point in the mid30,000 with the federal incentive in the United States. It will be attractive to customers and make a contribution, a great story. Taylor ford automotive president sat down with us to discuss whether ford has been late to embrace electric cars. Sure weve been making take our time until the time is right. The mustang extension of the brand, we want the cost right and get the charging network right. Locations,r 12,000 and want to get that right. Marginll be contribution positive. We will make them in mexico because a big horse and of the volume is going to europe. Portion of the volume is going to europe. We stopped building the fiesta sedan, and that plan can be converted to make battery electric vehicles. Europe, howbout much will be sold in the United States and china . No question china is a big market for electric vehicles. We will build it here and ship it to europe. The volume will be about half, and we will explore the opportunity to build the vehicle in china at a later date. How does this fit into the overall restructuring of the company . We announced an 11 billion plan for electrification. Vehicles we have launched recently, the explorer and escape have hybrid versions. Alexa vacation will be part of that portfolio elec trification will be part of that portfolio. In the background you are saying a movement away from our sedans and many more suv and truck offerings. Make cars, how to one thing i have read is with electric vehicles, you need fewer workers. Is that true . That is true. The body shop and paint shop are roughly the same. Most of where the labor is, half the floorspace requirements, 30 less labor to build an electric thecle largely because of wiring, connections, fluid in the combustion engine. You want to build a vehicle so you can take advantage of the footprint size. It allows us to bring in Motor Assembly and do that in the plant as opposed to somewhere else, and use that space efficiently. How big is the market for electric vehicles . Is a small portion of the fleet. 3 of the sales are electrified in total in the u. S. Last year, but we think that will grow over the next five to 10 years. We think the timing is right for us. We will maintain options for the customers, but by 2030, at least half of our vehicles will have some electricfication in the marketplace. Taylor that was fords automotive president. That does it for this edition of Bloomberg Technology. We are Live Streaming on twitter, check tictoc technology, and on twitter. This is bloomberg. This is bloomberg daybreak middle east. The university siege continues in hong kong, carrie theonce a peaceful and to situation. We will have the latest. President trump and jay powell have their second facetoface of the year. The u. S. Leader called for lower interest rates. From global to local, saudi ofmco cancels the london leg its roadshow, the latest sign of scaling back its international ambitions. Is reversing decades of middle east policy, declaring israeli settlements in oupd