Transcripts For CNBC Squawk Alley 20240714

Good Tuesday Morning welcome to squawk alley im Carl Quintanilla with morgan brennan. The market is down about 100 points starting with the apple special event set to kick off from the steve jobs theater in cupertino in just under two hours. Josh lipton is there live and joins us with what analysts and investors and reviewers are expecting. Hey, josh. Reporter so, carl, apples biggest day of the year just about to kick off here right behind me at the steve jobs theater. As you mentioned, analysts think they have a good beat on what is coming theyre looking for three new iphones. Faster processor and improved camera and maybe stronger waterproofing and shatter resistance big question for investors is pricing. What is tim cook going to charge for the new model. Ive talked to some analysts who think he will keep pricing basically constant no big change from the kusht lineup which starts at roughly 750 and 1,100 and expectations are muted on the street. Checked in with gene munster and what does he though total iphone will do in the Holiday Quarter and they are looking for 63. 5 million and that is a dip of 1 yearoveryear now in addition to iphones, focus on the wearables were looking for a new watch. Wearables have been a bright spot for this company. Even as the iphone franchise has been under pressure. Apple has sold an estimated 80 million watches now and 50 millionaire pods if you combine wearables and serves according to apple youre approaching the size of a fortune 50 company and speaking of those services it is six months since apple unveiled the new ones and investors still have plenty of questions about apple tv plus, what will they charge you for that service they are considering 10 a month on available and dont sleep on the Gaming Service analysts will tell you there are 1. 5 billion people playing cell phone games so a potential big opportunity. What else might we see in maybe noise canceling air pods or maybe a new apple tv with a faster processor, well timed given the new services and perhaps news on the new macbook pro. Stick with us and lets bring in editor and chief of the verge mella vettel. Who is also onsite. Good morning. Good morning. Let me start with an argument because that is fun with you i would argue that better cameras dont sell iphones Network Upgrades and bigger screens sell iphones so this whole exercise today for investors, take it or leave it yeah, i think the real answer here is in the names last year you had the iphone xr and the x max and this year youll see the 11. Then youll see an 11 pro and 11 pro max. A big question i have is how they differentiate the pro models, if that is what they do, how they differentiate between just it has a third camera which is what the big rumor is and if the iphone 11 is the default iphone, the one they are expecting you to get the real question becomes how many of those services and accessories could they attach. You buy an iphone 11 at a lower asp, will you buy air pods or apple watch or the entire suite of services. I expect to hear about the game service today. That is a interesting play for apple as they kick off consumer marketing it is differentiated compared to the tv service where there is still a lot of question parks. To that point, it is increasingly all about that installed base and leveraging that do you think maybe and even month so than previous september events that weve seen from apple, do you think that the services, do you think that the ecosystem and what the devices could enable in terms of a install base is the biggest focus here today i think they know they have a really sticky installed base as long as were talking to customers in the u. S. , youre not going to leave imessage weve talked about this so many times. You wont leave imessage and stay with the blue bubbles but they have to convince you that the other services are worth it but the goal is a unified vision of what living in the ios vision looks like were stuck in it. And it is good but it could get better but there are some things on the camera as you brought up, googles camera is kind of better samsung camera is good they have to make a big play to say this is they are not outselling the iphone good cameras, they only go so far. Yeah, on the iphone yeah they absolutely only get you so far. It is the ecosystem that keeps you in but they want to beat them on the tech specs too so the balance of we know we got you. Here is more stuff just buy it versus you are the leader and you feel good about the restrictions of this ecosystem. That is the balance they have to strike so nelay, when the journal said they have to emphasize accessories, even though the percentage of overall revenue for the nine months of the year so far that is iphone is down 15 . What is more important right now . I dont think anything is more important than iphone i dont think the huge yearoveryear sales gains will appear they dont have any more markets to unlock, no more giant Chinese Market and market carriers for them but if you listen to tim cook we have to make upgrades and tradeins easier so all of the people still happy with the 6s or the headphone jack and present a compelling case to upgrade and buy the air pods and apple watch and sign up for apple music. It is a lot of stuff to buy if you are happy with your iphone and iphones, and ios 13 is not different than the previous versions of ios. They have to make a sale about all of the things you could do otherwise people will just hold tight. Josh, and i realize were still two hours out from the event and youve covered a number of these over the years what does it feel like and what is the sentiment on the ground and how does it compare to previous events . Listen, morgan, at the events you could expect tim cook to take the stage with Jeff Williams and Phil Schiller to bring enthusiasm and excitement to the eent. Youll hear the theater there being live streamed and apple employees. So clearly were at the steve jobs theater here in cupertino, california so the excitement is there well see how investors and consumers react. Like i said, expectations are muted. But on the other hand, there are analysts who say there is still at a lot of people on old iphones, estimated 200 iphone 6er earlier that is potentially a lot of people who may think about upgrading to the faster processor and improved camera system well find out. And once again i would argue and neil im trying to start an argument with you and you are not playing with me such a troublemaker. I like to make trouble. Today doesnt really matter as long as apple doesnt screw it up because next year well get a 5g Network Upgrade with the phone and we havent had that since the iphone 5 in 2012 and that could move the needle if they improve capability and software to take advantage of 5g and if they dont screw this up and tell a story about new cameras and services and tread water, that is fine. Yeah, if you want to argue with me, i dont think it is fine i dont think apple could risk their position they cant take a step back. And it is a bunch of new cameras and expensive, they wont track the number of switchers or upgraders they need and they need to keep the upgrade rate high in order to maintain numbers and position but youre right, theyre taking a sort of year delay versus the samsung and lg and one plus of the world to put out a 5g phone. I think that is phone. The networks are far but ready verizon are announcing we have nfl stadiums it just certain areas of an nfl stadium. They cant even get that much range so the networks are not ready so if apple could hit the big Network Deployment moment with the 5g iphone those are two upgrades that will make it to pay extra for the 5g and get a new phone to address that network. That is a compelling upgrade you are right there. But they cannot take their eye off the ball or iphone 7 this one and put out a phone with the same but a different color theyve got to deliver on a vision here. Especially if they want the Service Rates to go up. I like that iphone 7 as a verb thank you. We still have more to come on apple roger macannie weighs in his expectations and next North Carolina state attorney general josh stein on the antitrust investigation into both google and facebook we have a big show of squawk alley continuing after this break. Dow is down 73 tech stocks are selling off. Stay with us. Improve our workflow. Attract new customers. Thats when fastsigns recommended fleet graphics. Yeah, and now business is rolling in. Get started at fastsigns. Com. Welcome back to squawk alley. Two antitrust investigations under way. 50 states attorney generals launching a probe no google and separately a multistate investigation into facebook as well being led by new york joining us now is one of the state a. G. s involved in both google and facebook probes josh stein of North Carolina. Mr. Attorney general, thanks for joining us today. It is a pleasure to be with you. Thanks for having me. I want to start with google here because certainly advertising practices have been a source of consternation from a number of companies over the years it has been looked at by regulators over the years for that business. And even google comes out and said weve answered many questions on issues in the u. S. And overseas and this is not new for us but it is new for you in a sense. Why now . Why are you looking to probe this business now. Well, thanks. Think how important the internet is to your and my lives. How we communicate with family and friends and how we do our work or conduct business its how we watch tv, sports, get the news it really is the Critical Infrastructure of the 21st century and it is hard to imagine back 20 years ago when it hardly even existed it was just in the absolute infancy. And where we are today, none of us could have possibly imagined. But now we have massive Big Tech Companies with dominance in the markets and they have the ability to really squelch the innovation that weve all benefited so much from through the internet and that is really what were looking at with google and with facebook is to make sure that these massive Market Players and dominant actors are not misusing their power in order to harm consumers and squelch competition. So the president of microsoft brad smith was on cnbc earlier today and one of the things that he talked about in light of the microsoft antitrust woes that took place years ago was that that situation for that company lasted 29 years but still less time than it took for ibm or at t what is your timeline for these investigations, whether it is google or whether it is facebook and are you prepared for it to last for decades well, we surely hope it does not require decades. And i will frankly say that an outgrowth of the microsoft investigation was the creation of google. Because microsoft was in some ways constrained, google saw a Market Opportunity and came into the world and offered their product which so many people benefit from so the whole purpose is when you do the investigation, hopefully in a timely fashion, none of us want this to go on for decades, in a timely fashion reach some resolution should that be the appropriate outcome. Yeah, i think some would disagree about what set google up to succeed. But i wonder what your focus is . Is it on consumer harm from these companies or is it more on suppression of innovation because it seems like those are different standards, consumer harm perhaps having to do more with pricing action and how much people have to pay suppression of competition having more to do with whether theyre using their monopoly to unfairly gain advantage over other service providers. And theyre not mutually exclusive. And consumer harm could be more than just the prices you pay although if google were manipulating the advertising power to raise the prices that consumers pay, then there is consumer harm and in regard to prices but we also in terms of the services that are available to us and the quality of those services, do these companies that have such market dominant positions adequately value our privacy . Are they safeguarding our information to the same extent they would if there were real competitors in the market against them so there are other ways to evaluate consumer harm and it related it suppressing competition, that also has an impact on consumers. Because there is a whole wave of possible new businesses out there that want to take the internet in directions that none of us can even imagine that could make our lives better but if they are strangled on the vine, if they never even come to fruition, then all of that opportunity, growth and value is denied to consumers, denied to the people of North Carolina and that is a real concern to the people of North Carolina. So with that in mind, i wonder, is there a fine large enough to satisfy this group of a. G. s because these companies revenues are enormous. It is hard to imagine them feeling that pain unless you get a change if Business Practices is that what you are after there is a range of possible remedies, depending on what the investigation concludes. But i think it really is premature to talk about what the appropriate remedy is, whether it is a fine or its some other type of remedy, relief, until weve done the investigation we have just want to start this work, wanted people to know that were gravely concerned and were beginning this work but lets do the investigation, see what the evidence shows and then go where it leads us North Carolina attorney general josh stein, thanks for joining us today it was my pleasure. Thank you. And coming up, it has been 20 years of alibaba and it is most visible cofounder jack a a is stepping down today what do the next 20 look like without him at the helm. And later the exclusive with the head of google cloud in the first ever broadcast appearance all ahead in just few a minutes. Stay with us at Southern New Hampshire university, we believe in education built for all people. [woman] snhu was the best experience of my life. [man] without snhu, i wouldnt be the leader i am today. [woman] i graduated high school 19 years ago. I still finished. [man] in the military, you feel that sense of accomplishment. Thats what snhu is. You will march from this arena and say to the world. I did it. [woman] you did it. I love you. [graduate] i love you too. Woi felt completely helpless. Hed online. My entire career and business were in jeopardy. I called reputation defender. Vo take control of your online reputation. Get your free reputation report card at reputationdefender. Com. Find out your online reputation today and let the experts help you repair it. Woman they were able to restore my good name. Vo visit reputationdefender. Com or call 18778668555. Welcome back is elon musk asleep at the wheel when it comes to the tesla energy business. This is the narrative from wall street but the growth from the Energy Storage business has some analysts changing their tune phil lebeau is in norwich with the story. Reporter and certainly when it comes to solar city, there are very few who believe that business is being run well given the recent results but when it comes to Energy Storage, tesla in the Second Quarter showed growth of 81 in terms of megawatts installed. We went up to battleboro vermont and the cappy family have two tesla power walls installed in the cellar of their home this is allowing them not to deal with blackouts whenever they happen up in the area and allow Green Mountain power which is the local utility to draw energy off of their power walls whenever theyre needed in that area in fact, the Power Company said the growth in demand for the power walls and Energy Storage is something that theyre looking to expand in the future. With the amount of solar coming on in the region, and in vermont they really do provide a Grid Stability resource. So they really help you orchestrate the energy on this system in a way that is very Cost Effective as well as incredibly reliable. Not just at the home level but at the grid level. Reporter for tesla as a company, energy is still a small component in terms of Revenue Generating just 5. 7 of the companys revenue in the Second Quarter. Analysts look at Energy Storage and say it is a nice business but there are limited opportunities for growth. Tesla has a great electric car business they need all of the batteries they can possibly get. Especially if theyre going to do the pickup truck and the semi so i dont quite understand why it is that they are that they are in the business of trying to do stationary storage. Reporter tesla Still Believes in stationary storage these are some of the power packs here at the solar farm in norwich, connecticut there are 30 power packs here. They have enough power to generator cover and run about 700 homes a year and tesla believes this is just a start of what it can do in the future in terms of commanding its Energy Storage business. Phil, not to change the topic too much, but there are so much discussion about the frank ford auto show and the way europeans are getting into electric. Weve seen musk try to troll porsche in the past week what is the sense of what theyll face in the year ahead reporter i think it is not a whole lot in the year ahead. Porsche is probably the biggest threat and that is on the very upper end. Look, volkswagen said it will have more electric vehicles as do other automakers but those are plans at this point. It is not like youll see a rush of electric vehicles coming in the next 12 months and that is why when you look at analysts and theyre asked continually what is the biggest threat to tess le, they dont see it on the horizon. Maybe three or four years down the road but not within the next 12 months. A lot of angles to consider on that name phil, we know youll cover them all. Phil le bebeau on tesla. When can he come back, jonathan mcniemi will join us that touk about to talk about the state attorney generals general investigation. And the dow is down 78 bowel 2960 were back in a minute de . I want free access to research. Yep, td ameritrades got that. Free access to every platform. Yeah, that too. I dont want any trade minimums. Yeah, i totally agree, they dont have any of those. I want to know what im paying upfront. Yes, absolutely. Do you just say yes to everything . Hm. Well i say no to kale. Mm. Yeah, they say if you blanch it its better, but that seems like a lot of work. No hidden fees. No platform fees. No trade minimums. And yes, its all at one low price. Td ameritrade. Apple event about 90 minutes away key questions looming over the push into services our Julia Boorstin is in cupertino with what investors are expecting. We know what john thinks about the content offering so far. What is hollywood saying reporter well, i think that the key thing about todays announcements, carl, is that we could get real insight into how apples push to Grow Services business is going, especially as sales of the core iphones are slowing down now the First Service were watching is apple tv plus. While apple has said that it will launch this fall. We are awaiting an exact launch date as well as a cost for the service were expecting it to cost around 10 a month. And well listen to get details on what content is available at launch plus we are waiting to see whether apple bundles together its tv plus service with the other Services Like apple music. Analysts tony sacka saying weve argued bundling could be a potential solution to apple tv plus scale disadvantage relative to netflix and disney plus the Second Service were watching is apple arcade weve waiting a launch date and a price tag. That is expected to be 5 a month. Now third well see if we get any updates updates on the apple news prescription numbers that partners are not happy how that service is going for them. And the fourth topic is apple card while it launched just about three weeks ago, well see if apple gives us any insight into early signups for the card or transaction activity and well see whether any commanded Financial Services are in the works. Now we have to remember apple is known for sometimes surprising the folks here with one more thing. Well see if they have any of that kind of additional news for us today but certainly services are in focus back to you. Julia, good stuff thank you. Joining us from london with his expectations and morellvation partners cofounder and early facebook and google investor roth mcnamee. Good morning. How are you im good. What do you think is on the line on this apple event day and how does it differ from event days in the past . So, karm, my read of this is a little bit different than i think has been the conventional wisdom i believe that apples big opportunity in iphone is to take market share away from android rather tan to just focus on services i think the Services Play will matter but i dont expect miracles to happen quickly there. What i think theyre trying to do now is to move away from the strategy when the industry was growing which focused on app store and itunes so focus on the place where they have the greatest competitive advantage over android which is privacy. And i think all of this news well talk in a few minutes about states attorney general coming after google and facebook and this news around privacy plays to apples hand. And if we look at ios 13 it doesnt matter what the hardware is that it runs on the advantages on privacy and security are becoming so huge that i think people will not miss them. They will not ignore that difference any longer. And i actually am more hopeful on the apple ability to gain share than is the conventional wisdom but it remains to be seen. Roger, is this a rebuilding year you look at 5g is arguably coming next year and so that cycle should be bigger than this one. Apple has got a stable and loyal base but i dont know that anybody expects this iphone season will blow the doors off even if they do gain highend share from android. John, i think this is exactly right. For people who care about features, android has significant advantages right now. And apple will in 2020 do a lot of the things that android is bringing to market piecemeal in 2019 i dont think any of that is really going to matter i think at the end of the day people will go to make choices on platforms relative to how important they think privacy is and people who value privacy are going to be increasingly iphone adopters and the thing that i discovered when i talk to people in the field is that there are a lot of longtime android people beginning to rethink that as news comes out about what happens to the stuff that you have on an android how things wind up in your facebook account or wind up in other places without you realizing. And so i dont know that apple could be successful with this focus on ios 13 on privacy but as a consumer im really interested in it i think the apple card is a really important step on privacy. Particularly in combination with apple pay. And then apples advantage there is a really big deal but i think, john, the way youre framing this from a hardware point of view, this is probably not going to be a big deal just to dig into privacy quickly, roger, a little bit more and you just mentioned apple card which is a good example but do you think apple is communicating enough just how important privacy is and how important it is to the Business Model . I dont think so. I think that is exactly the right question i think apple has been culturally in this metaphor of show and dont tell for so long that at this moment in time when telling actually could be advantageous, they dont have the muscle tone fully down when i talked to people in apple, i think theyre very aware of this issue and i think it is a big company and so it is hard to make that change i wish they would be more explicit about this stuff and i think that the flurry of news last week when google pointed out the security flaw that was taking place and then apple had to respond by pointing out that it was in china and mostly targeted at the uyghur minority in china, that felt like a significant change in apples communication strategy that they on this one issue i think are going to be more proactive so my fingers are crossed as a shareholder that theyre going to be more forceful in making these points because it is pretty obvious that google is going to take advantage of any weakness to criticize apple. Speaking of google. Lets turn to that crackdown on big tech you just renksed. Two of the most successful early investments under pressure as the states attorney general launch probes into google and facebook i wonder what you made of yesterdays announcement weve talked to a slew of these a. G. S. How much of this is grandstanding and how much do you think could be significant it is hard to say how much of this is purely political when it is clear to me that when you get 48 state attorneys general and plus puerto rico and the district of columbia all on the same side of an issue that has not previously been a giant issue for state a. G. S, there is Something Real going on here and there is no real for a. G. S cant benefit politically from doing the right thing and in this particular case the evidence is overwhelming that they should be doing something and in this case it is just an investigation. But it really does matter. Because the stateshave in some cases actual privacy charters in place that do protect consumers in a way that is not true at the federal level. And so for the states that have that, like california, it matters enormously to have them be engaged it is ironic in this particular case that california is not one of the 48. And im not sure what is behind that but what i do know is that for the 48 who are involved, this is an issue that is on the radar of their constituents and it is manifestly a good thing for them to be doing. As somebody who has been an activist on this issue for a long time, i welcome this. I dont know how it will turn out but im just glad it is happening. Roger, do you think this throws cold water on potential acquisitions by google or facebook while under investigation right now, even if the acquisitions are not tied to the businesses that are being probed i hope so i hope so. I mean, these companies have so much market influence today. And their success and Business Models have had a chilling impact on entrepreneurship in particular theyre Strategic Acquisitions of potential competitors theyre use of in google case of the venture operations to keep track of what is going on and steer Venture Capital dollars away from direct competition those things i think are a problem for the economy. And i think theyre a horrible problem for wall street. As were learning with some of the ipos trying to become public now if your trying to stay away from google and facebook you have to go into categories that are really highrisk and very capital intensive and i believe that these companies are at a point now where they should not be allowed to acquire anything until we have a new set of rules to govern their existing businesses. Well you have literally spearheaded this issue, roger, largely on this program have fun in london. Im grateful to you for giving me the platform to talk about this because this will eventually matter a lot to investors and knock wood well come down on the right side of it thank you. Take care. Roger, before i do let you go, quickly on wework and reporting from leslie picker on the ipo which is in flux how much do you think is truly unique so i look at wework and what they did was to revolutionize the way offices are structured in the way leases are structured but there are two assumptions imbedded in the ipo i think we have to as investors look at very, very closely the first is the assertion that they are permanently changing the way that offices are organized and leased that one feels to me like a pretty decent assumption but the second one is that their financing strategy where they essentially take out longterm leases in order to make short leases to their subleasers, that model is incredibly dangerous. Weve seen a lot of examples where you borrow long to do things short but that just blow up in peoples faces and given the vulnerability of Small Businesses to any kind of economic contraction, i worry a lot about weworks model not in the long run but the valuation assumes everything goes perfectly, theyve done a terrible job of disclosure in the ipo and i think the public needs to be hyper skeptical here. Roger, we work as the poster child for this soft bank mentality of invest a whole lot in these latestage companies so that they could grow super fast and outdistance the competition. The idea that they could grow and grow despite whatever Economic Conditions and you cant overinvest. Isnt that what is really sort of what is on trial here, to see not only how this wework ipo goes whether it happens or not and also how long is the runway for this type of company john, i surely hope that is what is going on because if you think about the other companies that we would talk about in that soft bank basket which could include uber for example, they spend 1. 50 or 2 to generate 1 of revenue and the crossover point to profitable are so far in the future you have to have significant uncertainty of whether they are ever profitable i look at this and i think part of what is wrong in our economy and our politics is this notion that there was one metric growth that matters and nothing else matters it doesnt matter if you make a profit, it doesnt matter if you treat your workers well, it doesnt matter if your honest about what you are doing and i think that behavior, you see that same thing going on in our politics and i surely hope wall street will show the discipline to say, wait a minute, things dont grow forever. Lets get back to basics lets remember that there are a lot of great businesses out there and there is no reason you have to have this rid pursuit of growth when you dont even know there is a real business underneath it. So just to top it all off or cap it all off, roger, do you think there is a bubble brewing in the private markets right now in this quest for yield . It sure it surely looks like that to me. But markets get to make their own choices on that so for myself i stepped way back and im looking at this and going the Public Markets look pretty good right now because youve got relatively easy fed policy, youve got a relatively trong economy and people in very defensive position so it is not crazy for me to imagine a big spike upward in the stock market in the short run but youre at tail end of a very long Economic Cycle and i suspect therefore toward the end of a market cycle and Companies Like wework if they go public inside of the range, that is a signal that were closer to the end than we are to the beginning. If wall street shows discipline now, that says you have more runway. Roger, appreciate it very much Roger Mcnamee covering the big topics in tech this morning. Thanks for being with us. Speaking of wework leslie picker is bringing us reporting all morning long and nor weeks about where we stand with this road show. Leslie reporter that is right so im told by two people there was a meeting last night to talk about the status of the deal for wework and there were conversations about launching a road show at the end of the week but it now appears more likely that it wouldnt be before monday or beyond as our david faber was reporting earlier. Also worth noting that just because you launch a road show does not mean the deal will ultimately happen. My sources were cautious about that im also hearing there were discussions about making some Corporate Governance changes to apiece investors but it is unclear what those are and whether theyll ultimately come to pass. Now against this back drop in the meantime, soft bank wants to put weworks ipo on hold accorded to separate sources muted investment demand would force the company to debut at a far lower valuation than soft bank had expected that could spell problems for soft bank which had put capital into wework at 47 billion valuation. Bernstein said in a note today soft bank will need to write down its Holding Value of wework if the ipo is below 25 billion. Sources say that wework and advisers have been speaking with investors about a valuation that is just onethird of that level. Now a huge markdown of wework could be trouble for soft bank they are aiming to raise 100 billion for the second fund to invest in startups the controversy surrounding wework plus the performances of other soft bank backed Companies Like slack and uber could turn perspective vision Fund Investors off and that is that is why they are looking to cut off the losses but wework systems all go for the ipo and another 6 billion through a credit facility, that is contingent on the deal closing guys leslie, i wonder, soft bank has been a big inflationary force in Silicon Valley and tech and beyond could this be a sobering impact not just on soft bank but on startup valuations in general think a lot of people in Silicon Valley and the east coast have looked at the 100 billion vision fund they have and when you have that much capital to put to work it could provide a reckoning when it comes to valuation so something years from now well look at a case study and be able to fully assess but were starting to see cracks now for sure. Leslie, thanks for keeping us honest on an important issue leslie picker. Squawk alley is back in a minute were down 68. But sophies enthusiasm cannot be dampened. Not even by a runaway donut. We powered through it in our toyota prius. Because a stars got to shine, no matter what. Its unbelievable what you can do in the prius. Toyota lets go places. When didwhen i needed ton . Jumpstart sales. Build attendance for an event. Help people find their way. Fastsigns designed new directional signage. And got them back on track. Get started at fastsigns. Com. Should always be working harder. Thats why, your cash automatically goes into a Money Market Fund when you open a new account. And fidelitys rate is higher than etrades, td ameritrades, even 10 times more than schwabs. Plus only fidelity has zero account fees and zero minimums for retail brokerage and retirement accounts. Just another reminder of the value youll only find at fidelity. Open an account today. Im scott walker here at one market we have another big show planned today. Coming up, brad gersner and bill gurley, two big hitters out here in the valley willjoin me as cohosts for the hour. Well talk wework and uber and the big names in technology. And counting down to the apple big event. One noted investor said tim cook must go. And well be joined by the next door ceo sara fryer. Her company just got a new investment and a new board member well ask her that about and her companys plans to go public when and if that may happen coming up at noon on halftime by the bay. Well see you in a few. Exciting afternoon, scott see you soon and today marks 20 years of alibaba and chairman jack mas last day and stepping down on his 55th birthday. So what do the next 20 years look like without ma at the helm adrian bosa has more from San Francisco. Reporter i think it will look certainly a little less flamboyant, less brash and charismatic. Who could forget jack mas Michael Jackson performance for 40,000 employees there is the anniversary celebration. Today is the 20th anniversary and it wrapped up moments ago and jack was a little more subdued. [ speaking Foreign Language reporter to close the show, he performed a rock ballad in chinese and nobody could take his place but he does leave behind a well benched season of executives tasked with finding new channel growth and there is daniel jong who is credited with creating the singles day bonanza and maggie with you and joe xie and the second largest individual shareholder after ma and steve john leading the exploding Cloud Strategy and these are some of the names you need to know when jack does hand it over now all of these people have been at the company for over a decade at least. Jack ma last year gave notice he would leave as chairman but he does plan to stay on an alley baba governing board what is next is uncertain. They launched in 1999 and they had fewer than 9 million interviewers and today there are more than 800 million user anz and expected to top abou chinas economic slow down, trade war, protests all the while making big bets. After the break, an exclusive with the head of google cloud. Were back in less than three. Session highs here. The South China Morning Post says china is expected to agree to buy more american ag in hopes of getting a better trade deal. Well see if the s p can erase a ninepoint loss. Back in a minute. When did you see the sign . When i needed to create a better visitor experience. Improve our workflow. Attract new customers. Thats when fastsigns recommended fleet graphics. Yeah, and now business is rolling in. Get started at fastsigns. Com. S Johnson Johnson is a baby company. But were also a cancer fighting, hiv controlling, joint replacing, and depression relieving company. From the day youre born we never stop taki care of you. S. Josh lipton sitting down with google cloud. Josh joins us now with the highlights from that interview. Google announcing the high Profile Partnership for the Cloud Business. Google cloud is going to secure store and manage the mayo clinics data. I spoke exclusively with google cloud ceo. I asked him how is the partnership going to improve his Competitive Position as he battles the big rivals like amazon and microsoft. We have a unique set of assets. We have the worlds best information analytics. We have material advantages in how a. I. Can be built on top of data. We have a platform that allows people to ingest clinical data, genomic data and other patientrelated data and build clinical work flow on top of it. We talk about the emphasis on sales. You have been acquisitive. Do you think, though, with increasing regulatory scrutiny on google, does that hamper your ability to do more big meaningful acquisitions in the future we dont see that, no. Why not i think the different businesses. There is a business in the consumer space and enterprise space. The Cloud Business in the enterprise space. We are focussed on delivering our own solutions and choosing areas to pick off the best complimentary partners to compliment our solution. Google has come under fire. Peter teal is saying reportedly fbi cia should investigate. Very tough words. Youre a high ranking google executive. We have tripled just because of the demand we see from Public Sector customers. We have a number of projects going on. We had a significant project with the state of arizona and other with the city of memphis. We have a project going on with cyber and defense in new york city. We are very committed to working with the u. S. Government to supporting them. We have many, many projects and many people at google working with them. Important part of this partnership, too, is who controls the patient data. Chris ross cio made it clear to me they do. The data will be protected and controlled by mayo clinic in the interest of our patients. So if you think about this as were using google cloud platform, its a safedeposit box inside a bank vault where we own the keys. Now, i did try to pin down how much is this deal actually worth . He wouldnt give me a hard number. He did say it is very important financially. Guys, back to you. Were going to watch that closely. I noticed tim cook has been tweeting about the event today, taking a photo using the hash tag shot on iphone. Maybe this will be camera centric event. Certainly looks like it will be. I would caution cameras dont seem to be moving the needle much in terms of helping any manufacturer to gain a ton of share. We have the dow down just 14 points after these headlines about trade talks with china and china possibly buying the president tweeted he has fired john bolten, no longer needed at the white house. We will watch that along with the ten year yield. Lets get to San Francisco. Im scott wapner live here in San Francisco as we continue our look at whats happening in Silicon Valley, whether your money can still make big profits in technology. We are of course counting down to the big apple event. We will see tim cook on stage. There is our count down clock. Today, we are joined by more very special guests. The founder and ceo of bill is the general partner of benchmark capital. And sarah frier is the ceo o