Transcripts For CNBC Squawk Alley 20240713

Where i was over the weekend among the headlines and there were a lot, a warning about potential risk for the u. S. If Tech Companies decide not to do business with the pentagon. My view is if big tech is going to turn their backs on department of defense, this country is in trouble. That just cant happen so we have to, it is up to the Senior Leadership to say i understand these are emotional issues, we dont have to agree on everything, but this is how were going to do it we are going to support the department of defense. This country is important. Meantime, heavily redacted 103 page document that was just made public a short while ago, amazon says President Trump launched, behind the scenes attacks against the company, which led to it losing out on the major jedi contract for Cloud Services that we have been covering so closely. Guys, in general the bottom line from jeff bezos at the event this weekend is amazon, you could make the argument origin, the Space Company looking for National Security work as well is really open for business with the pentagon, with the government he, himself didnt comment on jedi specifically, made comments about a level Playing Field. You want a level Playing Field for monday night football, dont want that for defense and military, voicing that he is concerned perhaps we are losing the advantage we have in places like space that the United States has, right. They want a level Playing Field between them and microsoft, but a distinction although also in that complaint basically suggesting that artificially that everything that happened has artificially leveled the Playing Field for Amazon Amazon and microsoft have both been pretty specific on this that hey, we hear you, that group of employees that says we shouldnt be dealing with the federal government, whether it is with defense, whether it is with i. C. E. , but were going to do it. Heres why we have old line Tech Companies, the likes of ibm and oracle in that camp a long time. The question is google and others, is there going to be more of a shift toward this point of view of we got to deal with the government or not. I think thats the question huge theme, huge discussion all weekend at this forum. I also did a panel with peter teal he weighed in on this, he has been outspoken about google, things like ai and china are concerned, and basically said he thinks that the Tech Community in seattle has been much more in the forefront in terms of working with the u. S. Military, which is the case. Microsoft and amazon thats who were talking about right now. Lets get more on amazon and the tech landscape, talk a bit more about aws joined by goldman, sachs director of Internet Equity Research heath terry. Curious to get your thoughts they say in various parts here, one of the keys despite a clear factual record establishing aws technical superiority over microsoft, including broad consensus among industry and lists and experts that expressed it as the frontrunner. Do you believe theyre technically superior to microsoft . If you look at market share numbers, it would imply that aws market share in the most generous standards is roughing three times that of microsofts within cloud it is clearly a decision companies macon a regular basis. They had the developer conference 120 different products that were announced or talked about at the event. You see independent sort of i. T. Analysts make the claim that aws is that far ahead of competitors in the space, so i think it is an easy statement for amazon to make that they are tech logically superior. It is valued up to 10 billion over ten years in terms of dod contract work, not the largest Contractor Program by any means part of the reason we cover it closely is future government opportunities. Have you punched the numbers, what does it mean for amazon, microsoft and others one, obviously government is the biggest single consumustome. For amazon, it was an opportunity to draw a line in the sand because you had a very Public Record of the administration trying to sway this on twitter and elsewhere and making it clear that they had a view on what amazon, what the outcome of this contract should be. You have the same thing with the Postal Service negotiations a few years ago that led to a lot of Amazon Investment into their own last mile delivery, when youve got something that vocal in the Public Record, being able to suggest there was something more going on behind the scenes isnt that hard. Talk google, alphabet just a few days ago larry page announced he is stepping back. He is still on the board, but not ceo or chairman. Now ceo of alphabet and google a, does it matter, b, does it blow up the reason for the alphabet, google thing if theres one ceo of both . I think it is a realization that ultimately at the end of the day, google is what mattered within alphabet. 98 of revenue, well more than 100 of profitability within that business. So to the extent that sundar was the one running google, effectively running alphabet, running what mattered, running what mattered most to investors. Isnt anybody going to ask how long bf sundar cuts the alphabet stuff does this put them in a worse situation for investment in the future i think sundar is certainly going to take a more serious look at those areas of investment but a company like google has to invest for the future. Things like autonomous driving and investments theyre making they spent 22 billion or more is that roughly right . It is around there. More than at t spenlds, more tha verizon spends. They have profitability levels to put it back in the business you want to see Companies Like that investing if theyre not, you have to question whether or not the future is there. If google snois not investing a those levels, have they run out of good ideas and thats not the way sundar wants to take the company. Theyre considered the leader in the space, certainly not something theyre going to step away from. Do you think amazon, back to amazon a second, in this complaint talking about what they say was the president s intervention in the award of the jedi contract, do you think they raised stakes more, perhaps raised threat to them, given the president made it no secret. Tries to make things difficult for them theres only so much them do, this is the first step in the process, i think theyll see how far it will take them. Talk about sass companies, they took a beating in the fall. Shopify is really a platform do you think that it makes sense fundamentally that those rebounded and the others havent or do they are they likely to come down or those like workday going back up . I am more focused on the internet space if you look at tech broadly, theres a dispersion in terms of outperformers and underperformers, Something Like shopify with exposure to ecommerce that they do, seeing strong numbers out of black friday 20 growth in ecommerce spending you have seen the kind of outperformance across that group, benefitting them as a whole. You have underperformers within tech that missed this kind of rally. The ones that are sort of most exposed to regulation have been central to that. So i think this hasnt been the kind of rally thats been across the market it has been much more Company Specific because of factors like that huge year for ipos, some of them good. A many more underperforming. In terms of the next classes or generations of Tech Companies vorlts need to keep an eye on, what the trends are, what the ipos will entail, what are they . We have seen investment into early stage areas. You look at seed and series a Venture Capital, thats been declining significantly every quarter since q3 of 2016, we have seen it declining as more money has gone into late stage things like mobility, food delivery, you have a lot of that going into areas like ai, Machine Learning has been a huge area for investment. We are starting to see some companies begin to make their way to market. Probably what our classic 2020 will look like also things that were supposed to make it in 2019 pushed into next year. This will be the first year we have seen in a while where u. S. Venture capital was done in q3, chinese Venture Capital was down the last four quarters in a row. Theres a real step back taken because of performance of ipos this year, by Venture Capitalists saying we need to get a hold whats going on with valuations within Venture Capital, need to see if the Public Markets will be there on the other side. Speaking of ipos, certainly this year we think of uber often times, underperformance there. 44 price target, four times enterprise value over sales. Why are you positive were positive mainly because we see whats happening in mobility, right . Were not going back to standing on the street corner, holding up our hand hoping for taxi to pick us up. This is clearly something we all use. People value it, people are willing to pay premium for it. Seen prices for uber and lyft go up on average 20 a year the last couple of years hasnt hurt demand still seeing 25, 30 growth for these services because consumers value it these are marketplace models, should be able to generate 30 plus margins, and those kind of companies typically trade 6 to 8 times sales when growing in this 20 to 30 range. Thats where you see the up side as they get closer to profitability. Spending it on eats and freight, other areas that may eat capital awhile i think they will youll see rationalization around the eats business clearly the amount of Venture Capital, one of the biggest areas of decline is in the food delivery space it is starting to get more rational, not seeing the same coupons and subsidies you saw even six months ago. Thats what happens for it to get to profitability, justify investments theyve been making. Appreciate you stopping by. Thank you. Heath terry. Peter teal was at the Reagan National Defense Forum over the weekend as we mentioned. We will fill you in on investing lessons and what he considers a decade long process. Dont go away. Be right back. Its them, calling us. Its going to be a week before they can get through on these roads shhh, sorry, i didnt catch that. I said ask how soon they can be here right now . Whats now . He says theyre surveying our property now theyre probably at the wrong house i dont see any hovering his name is hovering . Look up . By automating claims with Machine Learning and analytics, cognizant is helping Insurance Companies advance how they serve even hard to reach customers. Cool [spokesman] if youve tried colleg group cheering shed, snhu lets you transfer up to 90 credits toward you bachelors degree. [woman] it doesnt matter how old you are, you can do it, you can finish. [spokesman] finish your degree at snhu. Edu welcome back to squawk alley. Peter thiel, influential and at times controversial name in tech making news this weekend, speaking at a panel i moderated in simi valley, california he was investor in spacex had lessons of cofounding and funding palintir in both cases took wickedly long time, close to a decade, to start getting significant contracts from the u. S. Military and you know, in some ways they were not conventionally venture fundable eel on personally funded spacex, gotoutside capital maybe six years in to both businesses, so if you have something where you have a six year gap and can only get funded by someone putting in tens of millions of dollars as a sort of slightly quick project, thats a tricky template to repeat i think the lessons are learned from palintir and spacex, we made a lot of mistakes, made ways to sort of develop these things more quickly, mature things faster. If you have a decade long process. No time line when palintir may go public. It is one investors are watching closely. Also saying on that topic, one of the challenges of taking Companies Public thats a danger when it comes to Tech Companies, he sees it as almost a coup by the accountants and lawyers when youre still innovating fast and hard, but basically reaffirming at some point in the future he expects palintir and spacex to go public. A companys bigness may be its weakness, according to peter thiel who cofounded paypal. When i started paypal years ago, very different context. I was asked why cant a big bank do this. I never had a good answer to that, in theories banks have scale, longer time, capital, a lot of talent. I think the general answer is that it is just the internal politics are unbelievably bad, and this is true not just of large parts of the government, also true of a lot of large corporations, become incredibly politicize in ways that arent good for innovation. You can acquire a Technology Company at that point where you dont need to innovate any more. So if it is a fully formed thing, maybe thats a point it makes sense for prime minists to acquire them. He also did weigh in on as we talked about at the top of the hour, the fact that google pulled out of its military work with project maven last year in u. S. While continuing to have its ai Research Capabilities in china, talking about that, reaffirming this notion of ai, Artificial Intelligence as dual use technology, one that could be first applied where defense, National Security and military is concerned, why he sees it as such a cause for concern he weighed in on this idea of reframing this ethical debate, saying it is not an ethical debate, but around companies, american companies, Tech Companies working with the u. S. Military, but so did the rest of the panel. It was an allstar panel theres a notion or theme that came out throughout the weekend of this idea if youre not working, sure, you need guidelines and regulations, if not working with the u. S. Military, theres a civil, military fusion thats happening with china. If you think what the u. S. Government is doing at the border, say, is fundamentally immoral, sure, theres an ethical question there, not saying which way people should come down on that. Im going to ask a hard question youre a smart person, talked to smart people there thank you, jon. And i am not smart on this stuff. What is the u. S. Cultural or academic advantage in military Technology Going forward versus the likes of china or russia how much of it depends on immigration, on being a place where smart people want to arrive, how much depends on policy and how much is home grown in u. S. The immigration piece of this i dont think was talked about enough it was touched on on this panel from josh wolf from luks capital, the other vc funding startups in the space, touched on this, this idea of this idea of he didnt use this word, but almost like patriotism and being beholden to the country, the fact that Silicon Valley has its roots in Electronic Warfare that so much that came out of Silicon Valley, earliest funding was from the u. S. Military, but the immigration piece is involved because when you have engineers, we have technologists from other countries to come and work and maybe go back to their countries, they dont have that same feeling they want to work for the u. S. Military. One of peter thiels friends, maximum lunchen, the paypal, sergei grand, so many of the companies we are talking about even involved in the military issue, immigrants. I suspect youll hear more of the piece of the discussion, and especially at a company like google i think the majority of Silicon Valley, mike brown, head of the Defense Innovation unit, was on this panel, former ceo of symantec, he finds the vast majority of companies in Silicon Valley are not like google in the Tech Community but perhaps youre going to see more scrutiny of the types of employees that are within ranks when National Security is part of the debate. Chinese nationalists, for example, at a time theres an idea of an ai arms race, innovation arms race or socalled tech cold war playing out. Okay. Well see as we head to break here, look at two big deals in biotech, another part of technology sanofi buying synthorx these are deals for seiaesntlly what is science. More squawk alley when we return johnsbut were also a cancer fighting, hiv controlling, joint replacing, and depression relieving company. From the day youre born we never stop taking care of you. Welcome back, everyone i am sue herera. Heres the cnbc news update at this hour. The Supreme Court leaving in place a kentucky law requiring doctors to perform ultra sounds, show fetal images to patients before abortions the justices didnt comment in refusing to review a ruling that upheld the law the aclu had challenged that law. Russian president putin arrives in paris ahead of a summit in finding a way to end the war with ukraine theyre holding a series of meetings to try to revive a 2015 peace deal thats gone largely ignored. Young climate activists demand gains from Climate Change from leaders and negotiators at a global summit in madrid. The importance of involving indigenous communities in combatting climate crisis. It is so incredibly important that we listen to Indigenous People because they are suffering and their rights are being violated across the world and theyre also among the ones who are being hit the most youre up to date. Back downtown to squawk alley. Jon, back to you thank you, sue. And when we come back, Teslas Cybertruck hits the town we check in with kara swisher on elon musks latest drive and a lot more when squawk alley returns. Woman my reputation was trashed online. I felt completely helpless. 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. Introducin beep, beepdelivery, just in timwwrrrr e holidays beep, beep ssshhhh beep, beep errrrr bading shlrrrp bark, bark beep, beep sshhh shrrrp ding crrrnch, crrrnch beep boop errrr hey get free ingarage delivery from key by amazon when you connect your myq app or get the universal smart garage hub, now just 29. 98. Welcome back to squawk alley. Amazons jeff bezos speaking over the weekend at the Reagan National Defense Forum, defending big techs role in the pentagons war business saying, quote, we are the good guys, end quote. Defending the tech giants mission and corporate culture. Take a listen. High in competitor compensation, but we have not created that country club culture where you get free massages, whatever the kind of perks of themoment are, and i have had a bit of skepticism about those perks. You worry people will stay part of your company for the wrong reasons. You want people to stay for the mission. You want them to stay, you dont want mercenaries, you want missionaries missi missionaries carry about the mission. Joinings us, recode cofounder, cnbc contributor kara swisher good morning good morning. In a way, both of these things that bezos tackled, how Senior Leadership should respond to employees concerned about government contracts and hey, were not cod elg employees, both of these have to do with culture. Do you think his view will prevail in the long term well, there is that element of dont be big babies, you get everything, youre well paid, if you dont like it, move on he has been different his whole career amazon is not known as a company that coddles employees nor is it known as a company that tolerates anything but jeff bezos way it is in keeping with what he has done the entire time he has been running and founding amazon it is not unusual for him to say stuff like this. It is a point of view others agree with, a lot of Silicon Valley employees have perks that arent really the point. At the same time, theres an element employees should be able to speak out if youre critical employees about what youre making and have a say in it. Silicon valley and tech does encourage this by stock options, all kinds of ways. Theyre saying employees are owners if youre owners, you get to Say Something about it i cant help but recall steve jobs had a similar position on these sorts of things. Apple doesnt have a ton of perks, free food you have to go to cupertino and buy your food, but google and facebook have more keep them on campus, give them the goodies, and they have big employee uprisings now. They trained them like that, not just that, they have meme generators, tgifs where they can talk to the ceo and strongly in a lot of cases, less of a top down culture thats why you get that. That said, apple campus is gorgeous, people that work there have a beautiful place to work it is gorgeous i wish i worked at a lovely place like that. Same thing with amazon in their dome, they have the pleasure dome they created in seattle so i think it is a question of what kind of leadership you have you have a more microsofty and amazon, apple culture where leadership is really what they say goes or you have a more inclusive culture. I think in both cases it is fine if the employees speak up, and it is fine if management says dont, pipe down, dont be a big baby it is fine to have these discussions. And you know what youre going to get when you work at a jeff bezos company, this is the way he wants to run the company. When he says go, thats fine too. The fact that were having the conversation, companies that do offer some of the perks versus others like amazon maybe that dont speaks to how tight the work force is, and particularly when it comes to things like engineers and some of these potential tech employees that have the skill sets needed for next generation capabilities a, how much does the fact that you are seeing Companies Like amazon, like apple, facebook, continue to expand beyond just Silicon Valley and San Francisco, speak to that need, thirst for more people to enter their fray, above and beyond that area, and how much does it speak to the fact that at a company like amazon where theyre looking to take on more National Security type work, they feel like they can recruit more people outside of the valley no, amazon doesnt have as big a presence in the valley, theyre from seattle jeff made it his thing, he worked on doors. Everybody got a door, not a desk, whatever somewhat of a stunt. That we are a tougher workplace, put our shoulder down compared to Silicon Valley. A lot of companies outside of Silicon Valley, microsoft and amazon which are up in seattle were different in their tonality, they had an easier time of finding a work force in Silicon Valley, the employees have the upper hand, there are so few of them and these companies will expand and encounter all of the regular parts of running any company, in this case employees are owners again, theyre going to speak up, they feel like they can. And again, thats fine and by the way, just as much as employees can take it from jeff bezos, jeff bezos can take it from the employees if they object to whatever he wants to do, they can do that by leaving or just speaking up. All right lets move on, talk about elon musk bump in the road for him over the weekend, taking the new cybertruck out for a spin in los angeles this weekend, wearing manufacturer plates, and had a little moment of drama, seen hitting a traffic marker, not a road sign but traffic marker in the road as he exited a restaurant parking lot kara, elon musk, he is just like us, hits the orange cones. Overall, decent few days for him, right yeah. He won in the Defamation Case which was a twitter fight gone wild he shouldnt have said it. He apologized. I think the outcome is probably the way it should have been in this case. He shouldnt have done it, he apologized shouldnt have gotten to trial should have ended sooner i love that he drove the truck, good for him, showing off the product. It is a big truck. I guess he is sort of getting used to it i dont want to comment on hitting things, i have done that before, which is why i dont drive cars any more, im certainly not driving that truck, i would run over more than a traffic cone. It is good that he is out there. He is such a i dont want to call him pt barnum, but he is a showman. He is going to take it out, show it off this is typical of him to do so, and i like it. I think this is the first high profile case where somebody with a huge social media following has been accused of defamation what do you think the legacy of this is, are we going to see more of this as long as youre vague, maybe you cant be pinned down for defamation, or is this like wait a second, digital stuff is real, may have to show up in court several days it is a waste of time for a ceo of several companies to have to appear incourt, not that theres anything wrong with having legal proceedings, he made a stupid mistake, should have immediately apologized, done something for the guy first of all, should have not done it, but thats besides the point, this is elon musk whose trigger is a little shorter than the rest of us so you know, it is a waste of time for everybody, but certainly i thought the trial was kind of okay, which was essentially a twitter war. It was a rude remark that he made and paid the price for it by having to appear. This guy got his day in court. It was well aired. I think it ended exactly the way it should have ended he should be more like you and me i am terrible on twitter. I cant believe were not in court more often, jon, you and i before we let you go, kara, a hearty congratulations to you and the media team recode decode named the 2019 pod cast of the year, thats a big deal. Yes, thank you. It was great i love doing podcasting, started five years ago when nobody was doing it really. And i think it is an amazing medium it is on a growth trajectory, there are issues around so many of them, but it is an exciting medium, great way to communicate with people. The other one, pivot podcast with scott gallaway, but it is great. A great medium, great way to communicate. We love our fans and appreciate the award from ad week there will be no living with me any more really pretty much. Thats about it. You have so many jobs new york columnist, cnbc contributor, a few podcasts. I am well employed. Mom theres a big job. It is thank you, kara when we come back, t mobile and sprint in court to defend the 26 plus billion dollar merger we discuss when squawk alley returns. Into formation. Flying south for the winter. They never stray from their predetermined path. But this season, a more thrilling journey is calling. Defy the laws of human nature. At the season of audi sales event. 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. I am scott wapner. Heres whats coming up top of the hour we are at one market in San Francisco taking stock of a year, where money is likely to be made in 2020. Brad gerstner is with us, and fra the cofounder of octa is with us find out whether Software Valuations are too high. That and more when we see you at noon from San Francisco on the half morgan, 15 away or so. See you then looking forward to it, scott. In a mostly redacted filing, amazon taking a shot at the administration, saying President Trumps attack on the company led to aws losing the pentagon cloud contract to microsoft. This weekend ahead of the filing, exclusive conversation on the sidelines of the Reagan National Defense Forum, brad smith in a wide ranging interview did touch on jedi, alluded that overconfidence may have led to amazon losing out. We are best serveed being humble whether you win or lose there will be protests, they come and go. I think there are a couple of interesting lessons for all of us to think about as the dust settles from this. In any technology race, if you think that youre so far ahead that you cant possibly lose, youre probably going to lose. Thats what weve learned time and time again because this procurement lasted 13 months, it wasnt about selling a product that stood still, didnt need to stand still, and theres a second lesson, the lesson we tried to apply to ourselves never conclude that youre so far behind that you cant catch up if you work harder than your competitor we put more and more engineers on this working pretty much seven days a week for thirteen months to constantly create a better product so by the time the contract was awarded, we didnt know if we would win, but thought we had caught up. And we also know that we need to keep Going Forward every day or well fall behind. That is the real essence of any technology race. Those comments in response to andy jasse over at aws smith saying theyre continuing to do work for this program, on this program right now as i mentioned, it was a wide ranging interview. We sat down to talk, he has a book he coauthored, tools and weapons, and was on a panel there, focused on the idea of a technological cold war he was focused on the idea of interception between tech and National Security. We talked about things including china and on that where ai was concerned, he said ai fueled by data just the way a Combustion Engine is fueled by gasoline any country with 1. 4 billion people will create more data than another with 3 billion. Thats why he believes we need some sort of u. S. Alliance around ai with our allies and partners when you look to the future, think to the future, the Role Technology will continue to play in National Security. That is interesting i cant get over that sickest of tech history burns, microsoft telling amazon, if you think youre so far ahead you cant lose. I thought he would have reaction. Thats the story with so many microsoft stumbles anytime microsoft says you have to check yourself before you wreck yourself, thats like the tech version of that phrase, which i know you know well, david, being a new yorker. I do. I do tried not to wreck myself too often. Done well. Holidays it is tougher with all of the parties not to wreck yourself. That full interview is on cnbc. Com for folks to check out. Another quick programming note as well as we go to break, dont miss my exclusive interview, bob bakish. Heading uptown for that. First interview since the deal closed last week, around 1 00 p. M. Eastern. Quk le wl rht back hnson 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 taking care of you. Welcome back to squawk alley. Sprint, t mobile head to trial in a manhattan courthouse up the road from here the number three and number four u. S. Wireless carriers will defend the 26. 5 billion merger, contested by 13 state attorneys general and district of columbia joining us with more, with moret mobile founder and former ceo of that Company Great to have you back on. Thanks for having me. Good to be here. So much of this seems like its going to hinge in court on this idea of if these two companies merge, the creation of a new fourth wireless carrier with the assets that dish is going to take over, you certainly have a dog in this race, given the fact that you would like to be able to perhaps be able to buy some of those assets over dish, where boost is concerned, how would you expect this to law out . I think thats an important point. The point you have to look at when you see how the process is played through, the department of justice disagreed with the fcc. The fcc said the divestiture of boost alone would be enough. The department of justice said we dont think there is enough we want a fourth competitor. Its when john got on the phone to charlie and said i need you to stand up a Fourth Network the whole matter comes down to one thing, and that is, the judge is going to be looking at this as you said and rightfully said, is dish truly going to be able to be a fourth competitor the first answer to the question is from the day that merger closes theres no way in the world they cant, they can put that structure up in place so now the question why not well, i mean simply cant put up a network the day the merger closed these guys will need until 2021, 22, i would argue 23. If i believe the merger is going through i have to believe dish is going to be the fourth competitor and if history is a lesson thats a big question and the problem you have with the question is that the jump will have to say there are 9 million prepaid subscribers, 30,000 employees in the dealerships and small independent dealers that have to come along for the ride and take the risk that charlie and dish can do this thats too big a risk for them to take. Right i mean not to mention the capital outlet hes going to have to commit to and the numbers a lot of people say dont add up all that said sounds like youre a sore losers. Would you have done any better with it and been a fourth competitor were you going to get the money . The interesting thing to say im the to loser out of this is a little bit disingenuous i said sore loser, not fourth loser. If you look at us being a sore losers the losers in this are the dealers, are the networks i have a great family and life i will go on and continue to live the great life and family and a great business outside of america. But you know who wont have a great life, 30,000 employees, the 5 to 6,000 dealers, and the consumers in prepay. I sit here fighting very, very hard it was a long shot for us to be able to get boost back in the first place. Im a realist when it comes to this we were willing to step up with my own funds, time and money both the commercial and professional costs to me to fight for these consumers. We now have a judge sitting there, hes going to get rid of the hype the pink wearing magenta tshirt will be left out of the room and he will look at the facts and if you look the a the facts it comes down to one thing and one thing only, be that is, is the consumer going to be better off from this merger and the way it sits today theres not one person in the industry in the media or in that court thats going to be arguing yes, its going to be better off peter, no matter which way this goes, isnt the most likely scenario that we dont have four healthy, viable competitors in the u. S. Wireless market i got real questions about whether sprint can make it if this deal doesnt go through and you have raised questions about dish, right . Yeah. Absolutely youve got two very weak options. The question becomes is what is the weaker option of the two and you got to look at it, thats got to be dish. I sit back and go, okay, sprint has assets you know why, because theres a company in seattle that has promised the world to get this merger through, when most smart businessmen would have walked away from this merger they stayed with it they stayed with it because it has value. The same value that t mobile sees you cant tell me comcast, charter and other Cable Operators and Tech Companies arent looking at that same value. The synergies are enormous for them, the numbers, would be nowhere near that for any other potential merger partner acquirer. I will take you point remove the spectrum and argue would they be taking this based on synergies alone and the answer is no synergies means job losses and Closing Stores so if you look at the sipper ingys theyre talking about its one of the febtss you have there. Make the clear this is all about one thing. They want to get their hands on that they launched the 5g network with 20 increase in speed, theyve launched it with prepaid 5g, its a thousand dollar phone which they discounted to 800. The naivety to think that its an acceptable level for someone to come in, telling them they have to buy the golf member of the club, by the way, you can go and play the game for fre once you ponied up the money. All of this is to me a farce and the judge is going to see that and look at this and if he truly believes in keeping the consumers in mind, the way that it sits today it simply cant and wont work. Given the conversation were having right now, peter, i mean if you think about the broader i guess theme or push here around 5g, and the u. S. Being a dominant player in the adoption of that technology and those capabilities, it almost sounds like were talking about dammed in you do, dammed if you dont in terms of competitiveness on the world stage and in terms of rolling that out whats the solution . The solution is simple, there is no race going on today with the carriers internally. Its a marketing hype. 5g is nothing more than a marketing term theres no one set standard. Theres mid, low band spectrum, weve got, you know, buildings, you dont have buildings, put a tree up, doesnt work. There is so much hype going on the consumers are just getting confused and frustrated about what is 5g even if 5g became the holy grail they say it is i dont think consumers will buy it because they dont know what it is because theyve been confused. Peter, always great to get your thoughts. Thank you for joining us today. Thank you as we head to break take a look at the markets. S p, nasdaq, about flat. The dow down more than the others, being dragged a bit lower by apple, eibong and gordon sondland. Squawk alley returns in less than three e company. But to businesses, were a reliable partner. We Keep Companies ready for whats next. man we weave security into their business. second man virtualize their operations. woman and build ai customer experiences. second woman we also keep them ready for the next big opportunity. Like 5g. Almost all of the fortune 500 partner with us. woman when it comes to digital transformation. Verizon keeps business ready. Welcome back just getting a check on where we are with the markets right now slipping back towards session lows the dow, the s p and the nasdaq are all red. The dow down 69 points, back below 28,000 in todays trade. Thats a little bit red though just a little bit. Fractional. Given the positive news that apple is getting, reviews on air pod pros and impact on the stock surprising that will do it for us to the judge and the half. All right guys, thanks so much im scott wapner welcome to San Francisco where the Halftime Report is looking ahead to 2020 in Silicon Valley and where your money will work best in technology and investing in the year ahead. As you know its been a volatile year out here with high profile booms and busts. A wild year for tech and Venture Capital. A flood of ipos. Lyft popping more than 8 . Uber set to make its public debut. A blowup sparking questions about valuations in the valley. Coworking Company Wework will withdra