Transcripts For BLOOMBERG Best Of Bloomberg Technology 20170812

Valleys diversity problem. Lending club could be shaking off its losing streak, Scott Sanborn joins us to discuss their improving fortune and earnings report. First to our lead, disney is once again shaking up the movie industry, saying it will begin offering espn sports programming and some of its family films directly to consumers via two, new streaming services. Underscored sales and profits fell due to the division big cable tv where subscribers and ad sales shrank. We sat down with bob iger and discussed their streaming plans and the outlook for the company as a whole. We have seen a dramatic shift in how media is consumed. It is becoming more appbased. I see it with my kids and grandkids. A lot of the appbased consumption is done direct to consumers. You need the technology to do that as well and that is no easy task. It is not simple. Particularly when it comes to streaming live sports, we have consumption at a high level and all at once. So we bought a third of bam tech a year ago. We have accelerated our purchase of controls that we can move into this space at a faster pace and a faster rate than we initially anticipated, because of the opportunity we see and the marketplace. Combination of brands, technology, and consumer trends. I know the Walt Disney Company, you focus on the consumer and consumer experience. Who is the target audience . Who do you think will use this most often, the espn or the disney pixar . You are looking at the sports fans and at the espn fan as well. Sports is the most popular programming out there. If you look at the top rated shows in the United States, 94 were top were sports. Service will provide an additional 10,000 additional live sporting events in its first year of operation, so we are looking to reach the passionate sports viewers, passionate sports fan who wants to be able to watch sports on mobile devices that you describe as over the top consumer userces with quality interface, essentially that is what we are providing. On the disney side, we have a global fan base. Kids,families, parents, even teenagers and grandparents. Everyone and it is worldwide, not just in the United States. We are going to serve that fan well. Sportsicularly Live Programming has been a mainstay of television, going back to broadcast television. Certainly, everyone knows of it because of cable. Because of that, cable providers have been very reliant upon espn. What do you expect the reaction to be from cable distributors . We are going to continue to distribute the espn linear channels through the cable distributors. Together we have managed to create a highly profitable business. The distributors and programmers alike have been experiencing the disruption that the home market is seeing and multiple businesses are seeing from advances in technology and changes to Consumer Behavior because of that. We feel we have to react accordingly. My guess is that the distributors will look at this a threat over anything else, but it is not intended to be that. We taking advantage of Market Conditions and the passion product we create, and the technology that allows us to reach consumers directly. If you look at disneys businesses, except for the theme park business most all of our , product is distributed to products is touched by consumers through thirdparty distributors. This is an opportunity for us to reach the consumer directly, and that is an important step for the company in terms of growth. When a ceo like you makes an major, strategic decision like , they inevitably have to ask themselves do i build it or buy it. Did you go through that process . Did you decide to buy Something Like a netflix . Why did you decide to build it rather than buy it . Well, in some ways, it is a buy as well. We are buying the Technology Platform that allows us to get into the space as it is faster than if we would have built it. I am not going to look at netflix or other acquisition opportunities we have had. We have the financial wherewithal to do a number of things, but this seemed to be the best step for not only the Walt Disney Company but for our shareholders in terms of creating a growth strategy, really growing the company longterm, taking a longterm view which is very important. But also addressing the nearterm issues we are seeing which is all about the disruption created by digital technology. In the espn app, you have some major sports in here. You have the nhl, mlb, major league baseball, college sports. I do not see nfl at this point, i do not see nba. Are there plans to add those and under what terms could you get them in . Sportsntend to license specifically for this app, beyond the sports that have already been licensed either by bam tech or espn. This creates an opportunity for a steam on in more effective ways through subscription revenue as well as advertising revenue, and all the ways that a direct to consumer relationship can generate revenue. I think we can expect that this product will be in the marketplace for license more aggressively from multiple sports organizations possibly , including the nfl and nba where we have great relationships. I noticed in your release you said you plan to make original investment in a slate of original movies and shortterm content for the disney app. Are we talking about an investment we have seen from other Companies Like hbo or netflix . You have got to be careful because netflix, i cannot comment on what an biz on amazon has been investing but it is wellknown that netflix has been investing billions of dollars in original content which they have done rather , effectively. You mentioned hbo, maybe this is a little more akin to that. We are going to produce original movies and Television Series specifically for this disneybranded service. It will be incremental investment to the investments we have been making in television and Motion Pictures in the past. Emily that was david westin speaking with disneys ceo bob iger. Alibaba and marriott are teaming up to feature Marriott Hotels on up for a chinese travel boom. China is now the Worlds Largest source of outbound travelers who spent over 100 billion in 2016 sparking changes over the Global Tourism industry. Coming up, a google employees antidiversity screen raises concerns about diversity. This is bloomberg. Google has fired the male engineer who wrote a controversial memo about diversity in the Tech Industry. James damore authored an internal 10 page memo about gender inequality. Emily chang spoke with the him iny chang spoke with a bloomberg exclusive. It is hard to regret it, because i do believe it. Im trying to make google and the world, in general, a better place. By not confining us to our ideological echo chambers where only one side of the story can be heard and is totally intolerant to other viewpoints and even Scientific Evidence. Emily what Scientific Evidence are you talking about . Because in the followup to your piece, there has been plenty of discussion about this. And discussion about the fact that there is no research to support this idea that there are biological causes for the lack of women in tech or the lack of women in leadership positions. I spoke with megan smith who worked at google, the former ceo of the United States. She says this is a myth. Among psychologists there is prenatalus that testosterone does affect a lot of personality traits. In particular, our interest in people versus things. I am not saying that all men are different than all women. There is a distribution of these personality traits and that distribution differs between men and women. There are very many capable women at google and im not try , to say that any of them are any worse than average male engineers at google. I was just trying to address why we do not have equal representation from the population. Ly steve wood just ski carolyn wojcicki wrote a very impassioned response to this. It said, if the memo was about black people or latinos or the lgbt community, you would not have anyone defending you. How do you respond to that . I think that is a false analogy, and she is trying to lump me in with racists and bigots, which i am not. Racist. A big it or a that seems trying to smear my image rather than looking at the evidence. Barry few responses have been actually looking at the science. They have just been calling me names, or nitpick that the format was wrong, or the original leaked document did not carry any references which my original document did. Emily you are arguing for ideological diversity and inclusion. Tot you think that extends women and minorities and other kinds of people . Google is making products for the world. Dont you need to have all kinds of people making those products . I support diversity and inclusion, and i think also that our lack of ideological diversity has hurt our products. It makes us think, for example, just the stereotype that all conservatives are stupid, for example. That is widely held within very leftleaning circles. That was the former google employees begin with emily chang. We have another statement from google. Our job is to build great products which make a difference in our users lives. The ideas that a group of our colleagues have traits that make them less biologically suited for that work is offensive and not ok. Joining us is ellen hewitt has been reporting on this story and diversity at large. Talk to us about the town hall meeting that will be held with all of google later today. Andhis a rare occurrence what do you think he wants to achieve by this . The town hall meeting is the tgif that typically takes place on fridays. It will now be moved to thursday and it will be a hotly debated meeting. Ahead of time, you can see google is internally vote for questions they want to be addressed at the meeting and it seems like they are very interested in how can we make sure that we make google a place that feels comfortable for everyone . And how can we make sure it is a place where x test employees can express their views without being fired which is a concern , that that former employee brought up in his memo. Do you think there might be some way of issuing and easing the concerns that were even brought up at the Shareholder Meeting back in june or earlier this year, a shareholder brought that they thought conservatives are not welcome at google. If you talk with people who ,re supporters of james damore and he said the same thing in his memo and afterwards there is , this idea that there is a sort of silent minority of conservatives who really do not feel safe speaking of about their political points of view which is because they are not commonly held at google. It totally has implications for how google is viewed. Very powerful Silicon Valley companies tend to lean to the left, and that has had an effect in how they have dealt with allegations like they suppress conservative content. It extends a little further than just one engineer and his time at google. Emily tech was making its debut market. Orporate bond this comes as elon musk is making plans for a more Affordable Electric car. The automaker plans to spend 1. 5 billion in bonds. It will bolster its balance sheet. They burned through a record 1. 2 billion in cash for the second quarter. Coming up, on the hunt for more deals. What is next for the massive vision fund. Plus highlights from our , exclusive interview with the french finance minister. What he is promising a big change, and what that could mean for tech giants doing business in that country. This is bloomberg. Emily japanese tech giant softbank reported earnings this week. Sprint helped softbank Beat Estimates with an operating profit of 4. 3 billion. That is good news for softbanks chairman and ceo who is on the hunt for more deals and investments. The billionaire is in the process of creating 100 billion Division Fund to speed up investments in technology abroad. The fund was included in the results for the first time. He says he is mulling over various deal offers including from sprint and tmobile. Our bloomberg editor at large and bob odonnell joins us to explore the options. I think that is exactly what we are seeing him do and he has talked about this for years. Ironically, i worked for a company he bought 25 years ago when he first started this vision of building up media. It was a hightech music magazine. Watching him over the years and seeing this vision evolved he is , driving himself to be sort of the tech version of a Warren Buffett. He is creating this conglomerate of all these Component Companies that he sees as being critically important to drive forward this vision into the future. I do think it is a smart plan. Not all of them are going to work but i think he is placing them in good places. Emily cory, Warren Buffett of asia. What you think of that . I mean, come on. Warren buffett is Warren Buffett because he has proven to be successful. Thatis the opposite of taking enormous amounts of debt with tremendous risk on that date debt. If you watched the way the ceos traded in sprint over the years, he would see that it has brought them to the edge of bankruptcy over and over again. These are big swings for the fences. Anything but low valuations, he it. Sing a lot of debt to do to userying very much politics and use connections to try to make these deals happen. In particular, think of the image of him and the trump tower, visiting president elect donald trump talking about the createof jobs he would at the same time, he is still thinking about that tmobile merger that the Obama Administration had said was not good for u. S. Consumers. He felt that his personal appeal to donald trump might get that deal through, and now we are still talking about this. Emily bob, there is some discussion if he could coopt these deals. It is very ambitious. To be clear, im not saying he is a Warren Buffett, but that his goal is to be a Warren Buffett. His approach is not on value. His approach is on building and buying these core components. People do not think about the fact that he owns arm. Arm is the semiconductor rp company that has this incredible amount of inputs that most people do not recognize. He has got telecom, internet, robotics, he is buying a lot of Core Technologies which he thinks can be driven forward. The debt is a big issue clearly, but i think he is being smart in developing a vision. He has what he calls his 300 year plan. Obviously that is a bit overkill, but even having a 25 or 30 year plan is a big deal these days. I think he is making bets based on those decisions. Emily we have been talking about a potential sprint tmobile merger for years. How do you see this playing out . Well, there is this notion of mean. What that will how the landscape of more than half of the mobile phone market is basically between two companies with virtually the same market share, at t and verizon. Now, when it comes to 5g, things could be very different in terms of who has the spectrum and who does not. Maybe there is a chance to sort of rewrite the market share pie chart that you are looking at now in a world of 5g. I also think it is worth noting that he wants to be number one and is not satisfied with being number three. Look at the rear view mirror, number four is not too far behind. I think, as u. S. Consumers, we think about it in terms of how the government is looking at this. What he wants is to be number one. He does not want u. S. Consumers to have the best choices. He does not necessarily want u. S. This is is to have the best options. Businesses to have the best options. So, we could have fewer competitors in the u. S. Providing fewer services in the world of 5g when so Many Technology services will be based on the availability of 5g. If there are fewer competitors, we know prices will be higher. Going to mean for businesses and consumers going forward, and will the Trump Administration care about that and come to a conclusion different than the Obama Administration saw . Emily bob, this would not just be another big tech deal, but it could impact directly hundred of millions of customers. Yes, it could. Clearly he is going to need to get all of those pieces together. As well as piece tmobile and sprint in order to be competitive against the other two. So, there is that question of if he can really pull it off. I think in the Current Administration there will be less governmental pressure than previously. There clearly are going to be challenges to the consumers or other Governmental Agency entities may step into this to say this is too big to make happen. Cory, we heard talk about that Division Fund still being raised. What did you see about how this is going to be spent . It is way too early to see. We are going to start to see perhaps some fees. How they recognize those from an accounting basis. If you look at the history of sprint, you will see a couple of bets which have paid off fantastically from the venture side of things. Whether it was investment on the game side of things or alibaba in china or yahoo japan, there were such great returns from those investments. You can see what he has some stars in his eyes and that he wants to pull that off again. Whether it is money from other investors or sprint itself. Emily that was bloombergs cory johnson and bob odonnell. Coming up, an exclusive interview with lending club ceo Scott Sanborn on the companys latest earnings report. How they were able to turn the corner after the surprise ousting of their former ceo. A reminder all episodes of , Bloomberg Technology are Live Streaming on twitter. Check us out at bloomberg tech tv weekdays, 5 00 p. M. New york, 2 00 p. M. San francisco. This is bloomberg. Emily welcome back to the best of Bloomberg Technology. Im emily chang. After the san franciscobased Company Posted its second highest quarterly revenue in history, seeing that spike 35 yearoveryear to 139 million. The improved figures come a year after the former ceo was ousted after the board found problems with lending practices and his lack of disclosure surrounding a personal investment. Scott sanborn joined us for an excuse of tv interview to discuss the future of the company. An exclusive interview to discuss the future of the company. It is about putting in the right controls and bringing investors back in the platform. A critical piece is banks and we announced in q2, 44 of our money came from banks. Emily when it comes to the scandal, do you feel like the company is back in a good place . I think both the results we delivered this quarter and what i just talked about, having our investors back on the platform, are clear signs that we are looking ahead. Emily your main competition is credit card companies. No small opponent to take on. Where are you gaining ground . If you look at the broader market, there are over a trillion dollars in outstanding Credit Card Debt. Over half of americans have had Credit Card Debt in the last 12 months. If you have not paid off your Credit Card Debt and you have a loan it is probably not a good one. We make it easy for them to save on average 24 on interest versus that product. That is the core audience were going after. Emily lending standards could be getting looser where do you think we are in the cycle . 100 trillion in outstanding credit card balances is as much the financial crisis. It is higher. One of the powerful things about our motto is we make all of the performance on our loans publicly available so investors can see every loan we have ever issued over credit attributes for that loan. What is it look like but what is the payment history . What we are seeing, we did see deterioration in credit performance about 18 months ago. We talked about it and took swift action. What we are seeing now is a stabilization and performance and our loss rates and our forecasted returns for investors remain in line. Emily when you think we will see things turn . Will we see things turn . That is hard to predict. What you are hearing now is in certain markets, the auto market is starting to see signs of deterioration as is credit card. On the flipside you are seeing a like forthings to macro consumers unemployment is , low, inflation is low, oil prices are low. Household formation is up. These things are counterbalancing the thing to watch is consumers ability to service the debt they have accumulated. That has moved away from mortgage and moving into student, auto, credit card. Emily what risks are you being vigilant of as you grow, from origination . It is critically them porton critically important for us to be good stewards of credit performance. They are aided by the data we generate and we are the largest provider of personal loans. We have been doing this for 10 years. We have a lot that we can see and compare. 100 quarter we had over Institutional Investors purchase from us. They had analysts giving us feedback. The signs are looking for are the consumers that appeared to be accumulating debt and not doing what they intended which is to pay down or pay down or pay off the debt they took on. Emily your board includes people that have weathered the financial crisis. Whether the. Com bust weathered the dot com bust, what are they telling you about risk . It is an exceptional board there been useful to guide the company and set the course forward. Looking to illustrate what the risks are in terms of the market and make sure we are executing deliberately. Our execution in q2 is about product experience and marketing experience. It is not related to credit. Emily he launched the first securitization how big was the funding . The loans contributed were loans that have taught historically. In terms of the overall funding mix, it remains a small percent but what it does do is introduce us to a whole group of investors. We had over 20 new investors who participated. That was great to see. It showed a lot of demand for the lending climate. Lending club asset. Emily that was lending clubs ceo, Scott Sanborn. Continuing Global Expansion centering on southeast asia, the Worlds Largest provider of shared workspaces says it will invest 500 million in the region and will acquire a singaporebased startup. This comes on the heels of the announcement to expand to china, japan and a third location in seattle. Bob odonnell joined us to break down the details. The acquisition is the first time that they have acquired another type of coworking space. The previous acquisitions have been for related services. With this accusation, which was likely not very large, they are getting a local team with local expertise. Space mob is based in singapore. The company says they wanted to do this acquisition for the talent and local expertise. They have been expanding rapidly. Theyre taking this approach where they are finding people who are already there and have expertise and finding investors together so they can rapidly scale in the region. I interviewed the head of spacemob last year. Listen to what he had to say. Lines are blurring, even being thise offered. Is a way for them to be flexible as learn how to be nimble small companies. We are helping companies, small to become vague and for Big Companies to remain small and nimble at the same time. Emily 20 billion here. It is impressive they have gotten this far. I have done research and there are a lot of concerns people have once they started actually do this. What you find is they are very noisy environments. It is hard to get work done. When i look at trends of where people expect to be working, those wework type of situations were growing but then stalling. That is the concern. The other big concern is that this has traditionally been a u. S. Business, tech focused attraction. You find a lot of u. S. Based Tech Companies working in these environments. Whether that can transfer culturally and in other industries remains to be seen. Emily Tech Startups are not the only kind of new businesses out there. How is wework addressing concerns . Wework have a very high valuation and they need to live up to it. Are rapidly expanding globally. A lot of concerns are that this is a cyclical business. When Tech Startups are doing well they will have a lot of business. They also made changes in their strategy to incorporate enterprises and larger businesses, that microsoft like microsoft to want a Flexible Working space. They are trying to diversify their revenue stream globally and with their existing coworking strategy. Emily uber is said to plan on unloading its subprime car leasing program. According to people familiar with the matter, exchange leasing, a whollyowned subsidiary, is unsustainable and should be sold or consolidated to a smaller unit within uber. Its 40,000 car fleet has an estimated loss of 9,000 per vehicle. The board continue to wind down continue to wind down the program last month after cost revealed to be much higher. Coming up, facebook is bolstering efforts in combating hate speech. We dive into the tech giants latest move and possible impact. Netflix makes its first ever acquisition. We talk about why the streaming service sought out a comic book publisher. This is bloomberg. Emily facebook is doubling down on efforts to combat hate speech. Theyre adding 500 content control staff in germany. This comes amid pressure in the country to crack down on offensive posts. The countrys lower house recently passing legislation that threatens fines of up to 59 million. That fine would be levied on large social networks that fails to report hate speech or remove illegal postings. I caught up with Caroline Hyde from london, and asked what was behind the uptick in staff. We heard as recently as may and more recently in june that we would see a beefing up across the world of content control people that would be working on behalf of facebook. That they would be expanding by 3000 new content control staff. To beef it up to be 7500 worldwide. Notably, most of these people tend to work in outsourcing companies. This is what will be happening in germany. 500 being added in the west of germany. They have already got 700 and in the capital of berlin, working for a different outsourcing company. It is notable that germany has hatred forman hate speech. They have been tough legislatively. The Immigration Crisis of 2015, you saw neonazi sympathizers taking to social Networks Like they spoke to put antiimmigration views across. This is why there is focused to tackle this in germany. They have a key election about to happen in september. Emily what you make of how facebook is handling this issue now . I think they are trying to do the right thing. 7500 sounds like a lot of people focused on this, but if there are 2 billion people on the platform. If a good percentage of them are saying things periodically that are not very sociable, it will possibly take more than that. The are also focusing conversation and comments that these people ought to look at. Focusing on germany is actually very smart for them. It is the country of all on the planet that is most sensitive to this issue. Maybe china for other reasons. I think they will learn things there that they need to learn. Emily caroline, will other countries be doing the same thing . Will we be seeing this elsewhere . We have heard in the United Kingdom and in france, talk of bringing in legislation themselves, fines, themselves. This came after the terrible london,in manchester, and the atrocities in paris. We saw france and the u. K. Announce that they would be doing an antiterror campaign that was announced in june. Much of it was focused on social networks, on facebook. In fact, Sheryl Sandberg came to the u. K. And spoke to the home secretary a couple months ago and had just been in Silicon Valley talking to the social networks and how they could crack down. Really it is germany that has , led the charge. Emily david, social networks, facebook, google, they have thousands of workers around the world not just dealing with , hateful content but offensive , content, inappropriate content. They have been criticizing for outsourcing this work, some of the hardest work, to other countries where maybe employees dont have the same protection. What do you think of that . Ive never been a big critic of outsourcing. Jobs are jobs and people if they are capable should be allowed to do work. The one question here is, does facebook have sufficient control and guidance capabilities over the people who technically work for outsourcing companies . I suspect they do. Those people in many cases are extremely talented and well trained. It is hard work. It is the kind of work that americans dont want to do. It involves looking at things over and over again, looking at pornographic photos, looking at awful things. They talk about the need to give these people psychological counseling to do the work. I dont criticize them for using outsourcing firms. I criticize them for maybe not having enough people and making fast enough action but i think they are trying they just need to try harder and they know it. Emily caroline, what do we know about the resources these employees are given and what sort of counseling or psychological help that they are also receiving . Concrete evidence is few and far between, emily. I went back to the post that announced this hiring in germany and three times they mentioned the need for necessary support. They clearly realize there is this concern when people are staring into the abyss of human depravity, what support can you give to these people from a psychological point of view . They have spelled out time and again they will be giving them canceling. There will be plenty of training available. These are people that are eventually hired by contractors. How much control of the have . The contractors are based in germany and will be working closely in a network, but it is hard to know exactly what sort of a support system these people will have . Emily david, 30 seconds. In germany, in the german language they will now have 1200 of their 7500 people. Think of all the other languages happening around the world. If they were to have a proportionate number of people working on this problem in every language, it would probably be hundreds of thousands. Emily Caroline Hyde and David Kirkpatrick there. Out of europe, tech giants have taken advantage of tax loopholes in the region. Lowering costs and grabbing market share from local competitors. Speaking exclusively to saying the country is gearing up to proposed new rules that could have big implications for the Tech Industry. It is always the same strategy based on the same roles for everyone. When you are doing business in france or europe you have to pay taxes. You cannot take the benefits of doing business in france or europe without paying taxes that other companies, french or european, are paying in europe or in france. The same holds for all companies and all states. Does that mean that you want to Lower Company tax to 25 everywhere in the eurozone . We would lower the Corporate Tax from 33 to 25 , in 2022. The second step, we want to have tax harmonization among members of the eurozone. 19 members of the eurozone one currency, the euro and you have 90 levels of taxes. 19 different economic policies. We cannot go this way anymore. That is why we are advocating for tax harmonization. The first step of that on the european level would be a tax harmonization between france and germany. Im quite convinced no later than 2018, we should be able to have a common Corporate Tax between germany and france. This could be the basis for harmonization of all Corporate Taxes at the level of the 19 Member States of the eurozone. What concessions do you expect from the germans to further this european integration and in exchange would you accept a german as the head of the ecb for example . Be patient. We are in 2017 and the decision must be taken in 2019. It means we still have time before deciding who will be the next chair of the ecb. We should not wait before taking decisions as far as integration of the eurozone is concerned. I think we should be able at the end of 2017 to make the First Step Towards more integration within the eurozone. Emily that was the French Economy and finance minister in an exclusive interview with caroline connan. Coming up, a move 20 years in the making, why netflix decided a comic book publisher was the right pick for its first acquisition. If you like bloomberg news, check us out on the radio, you can listen on the radio app, bloomberg. Com, and sirius xm. This is bloomberg. Emily David Letterman is making a return. Teaming up with netflix for a series that will feature interviews and field segments. There will be six hourlong episodes which will premiere on netflix next year. Letterman spent 33 years as a talkshow host. Netflix has made its first acquisition. The Company Announcing it snapped up millerworld. The acquisition is the latest bolster its own content rather than just licensing it. This comes as other companies become wary of providing content to streaming services. We discussed netflixs next move. A big part of it coming off that disney segment, disney, time warner, they have pipelines of comic book materials from which they can use. Right now, all of the tv shows and movies that netflix offers are from disney. Tv shows that marvel owns and produces, movies that netflix licenses after they appear in theaters. Netflix wants its own pipeline original comic book material that it can own, exploit down the road if it wants to make tshirts or lunchboxes or themepark rides. Emily what is your take bob . Is this a smart deal . I think it is. You mentioned netflix as a media company. That is different than netflix as a streaming company. For them to become a media they have to buy and create Company Original content. , if you want to create stickiness in your service, that is the kind of move you have to make. Amazon is doing that for prime, netflix is doing this, i expect we will see more of this. I expect this is a challenge for apple who has talked of doing it. It is not clear what their commitment is yet. Timy when i spoke with cook after earnings last week i asked about video and original content. He said it was very experimental. What do you think this means, lucas, for other big Media Players and unconventional players like apple . The traditional guys, disney, fox, time warner, viacom, they are intrigued by this. They are sure what to make of it. A few people asked me to explain it. Netflix has never bought anything before. As you said, this seems like an outlier. It doesnt mean they will be buying a bunch of libraries but it opens the door to that possibility. It reinforces that netflix wants to be ready for a world where no one is going to license them. We have seen these companies retrench and revise their strategy because they felt like they were giving their valuable ip away to let netflix build its service. As for the new players, we report on Companies Like apple and facebook and google but we have really reached a point where in terms of media creation , production, ownership, and Development Netflix and amazon , are on another plane. Netflix and amazon are making as much tv as the Biggest Media Companies out there. They are streaming over the world. Apple and facebook are still dipping their toes. Emily hulu just had its first hit, the handmaids tale. After many years of trying original content. That amazon and netflix are so far head, does that mean that no one else stands a chance . The content creation business is tough. There are decades of history about how difficult it is to make that successful. It is a hard skill to acquire. You are seeing a lot of efforts, a lot more of the Tech Industry marrying up with hollywood. Bollywood, other places trying to come up with original content. The notion of all of that content being given to netflix, licensed to netflix to use, that may go away. They have to be prepared if they want to survive longterm as a media company. We have to start thinking of them in that regard. Emily lucas shaw and bob odonnell there. That does it for this edition of the best of Bloomberg Technology. We will bring you all the latest in tech throughout the week. Tune in each day. 5 00 p. M. New york, 2 00 p. M. In san francisco. All episodes of bloomberg are now Live Streaming on twitter. Check us out at bloomberg tech tv on weekdays. That is all for now. This is bloomberg. Got you outnumbered. The dinosaurs extinction. Dont listen to them. Not appropriate. Now im mashing these potatoes with my stick of butter. Why dont you sit over here. Find your awesome with the Xfinity Stream app. Included with xfinity tv. More to stream to every screen. Coming up on bloomberg best, the stories that shaped the week and business around the world. Heated rhetoric between the United States and north korea sending a chill through the markets. President trump they will be met with fire and fury, like the world has never seen. The rhetoric continues to ratchet up almost by the hour. South africas president of president surviving a political challenge, and chinas tourism boom spurs a surprising partnership. The marriage of online to online, or online to offline. Sheryl sandberg saying that facebook is committed to use its power for good. We are not per