Go to my colleague, Olivia Sterns todays headlines. Adobe systems forecast profits that will fall short of analyst estimates. Fewer fulllling versions of their desktop software. The income for the fiscal Fourth Quarter is 71 . Trading,e first day of the Largest Hotel operator raised 3. 5 billion with a record ipo for the hotel industry. The company and existing shareholders sold 117 million shares. The stock closed above 21. On the flip side, low lemon stock fell the most in six posting below analyst estimates. Had a slowdown in sales in the Third Quarter that has continued into this. This period. Theoments from now bipartisan budget deal faces its first test. The house is going to begin voting on the modest deal that permits another Government Shutdown for two years. But this has done little to address the longterm fiscal challenges of the nation. Peter cook is on capitol hill. Is there any doubt on the outcome of this agreement . There is no real doubt in the outcome. Top republicans and democrats have said that this will pass the house of representatives in a short amount of time and they are backing this bill despite continued criticism from conservative republicans that it does not do enough for the deficit and criticism from liberal democrats who say it is not do enough to help americans who are hurting, particularly those on unemployment right now. Notecember 20 that is part of the deal and there is no extension there. This does avoid the possibility of a Government Shutdown for the next two years and replaces some of the sequestration cuts that democrats and republicans dont want. And they will live to fight another day, this means there is no big fight over taxes and entitlement programs. Paul ryan, the Top Republican crafted this in the house, countered by chris van hollen, the democrat, who stepped up to support the bill. This bill is not what i would like and it is not near the breadth and scope of the budget we passed earlier, but that is how it works in divided government. In divided government you dont get everything that you want. But i think that this bill is a form firm step in the right direction. This agreement is far from perfect. This is not the budget agreement me or my colleagues would have written, but on balance and at the margins it represents a small but positive step forward. Hollen was late for the bill, we also heard from nancy pelosi, the top democrat in the house who says she does not like the bill that she will support this and most democrats will as well. We expected the majority of republicans to support this along with a great number of democrats as well. What about outside conservative groups . House speakerwith john boehner . This is the most fascinating part of the debate, the split between the conservative groups in the house because for the first time in these debates, the House Speaker criticizes those debates and opposing the bill before they read that, and this is what he says about the speaker. I take criticism from the right and the left, i call for a more accountable federal government and this budget agreement takes steps in the right direction. When groups come out to criticize an agreement that they have never seen, you begin to wonder how credible those actions are. Interesting words from john boehner. Very striking on capitol hill, how he has pushed back against people asking, will the challenge of these conservative groups and the tea party element Going Forward. Thank you very much, peter cook. Next i will bring in bill hoagland from the Bipartisan Party center, he worked 33 years in the federal government and was the federal budget staff director for 17 years and joins us from washington. What is different this time . Thank you very much for having me on. What is different this time is for the first time in the budget act over 40 years, we will have a budget agreement where the senate is under democratic control and the house is under republican control. Never in the history of the budget act have we been able to come together with that division. We have had budget resolutions in the past and 1986, the last time we had a bipartisan agreement when the senate was controlled by republicans and the house by democrats, this is a giant step, says mr. Van holland this is a step in the right direction to find Common Ground between the house and the senate moving forward. Has anything changed in the disposition between republicans and democrats since the Government Shutdown . When we went to the Government Shutdown, there was a clear recognition on the part of a number of republicans that this was not the best thing to have done. Maybe it had hurt them Going Forward in terms of the polls, the polls have have the congress at the lowest level this has been since people have kept polls on the congress, and i think there is a clear recognition that there is the need to get some form of working relationship between the house and the senate moving forward, to stop this bickering that has been going on and hurting the American Public. Going forward. What does this do for president obama . I work for republicans for those many years but i have to say that the president is rolely he can play some but not the role that one would have expected. Or that i would have expected with these negotiations. What do you mean by that . Past,id not see in the when i was involved in these negotiations like the shutdown in 1995, president clinton was actively involved, debating, part of this negotiation. I am not criticizing the administration. They put forth a budget back in the spring and some elements of what they put forward as it relates to the retirement programs for federal workers was a strong element of this. This was between chairman mary and chairman ryan. This is where we have to pass that legislation, and so i am not criticizing the president that thisly suggest is where the negotiation had to take place. This took place in congress. Is this consistent with the with what the administration has taken so far with the first and second term . What the president put forward, a budget that he worked strongly about. They reflected many of the president s requests coming forward. This was an effort on the part of, what we can get done, and show, working in the bowels of that capital up there, they can show the American Public that we can have republicans and democrats working together. I think that for the president we avoid another Government Shutdown, at the beginning here. The difficulty that i have to highlight, which i dont think thiseen highlighted, relates to the statutory debt limit, which we will still need in february. I dont think we will have a Government Shutdown if this will pass the senate later next week, probably, but we have not addressed this specific issue. They will still be against that in february and march. We are not completely out of the woods here, as it relates the fiscal situation next year, but we have made a major step in not having government, if this does pass through the house. We will see a real reduction in the difficulties that we went through with the Government Shutdown in october. Would passage of this budget bill hoagland, will this allow passage of other issues like Immigration Reform . This is part of the charged political environment we deal with, to deal with things on a bipartisan basis. We will have a bipartisan farm bill when we come back at the beginning of the new year. This shows that we can work together. Each individual piece of legislation faces its own problems and issues, i will not suggest that this necessarily makes everything easy, Going Forward on Immigration Reform and health care reform. I think we will still see those issues being debated, but on the fiscal front we have a small step forward in dealing with the Government Shutdown, a small effort in reducing the deficit out into the future. This is nothing to write home about, but this does show that we still have the opportunity to define the working relationships between republicans and democrats and this may be a small element of the opportunity to work on larger pieces of legislation. All right, ill hoagland bill hoagland. From small acorns to large oaks grow. What are the uses of those little buttons on your smart phone or computer, the mobile apps. Fore is a Marketplace Developers to find out what their applications are worth and how they can cash out. Archie manning and the heisman presentation is saturday, he will be here to talk about college sports. Recentlyple app store announced an inventory of milestone, one million titles. And 6 billion downloads all around the world. With numbers such as that, apps are big business and growing. My next guest has worked to bring App Developers to app buyers. Jonathan kay is the foudner of online marketplace for apps. How do you describe that to people who have no idea what these are, but know about those buttons on their smartphone . There is a developer behind each one and they need to make money. Some of them make less money. We have a market that provides an exit strategy for those developments. Facebook,is sold to and there are one million apps in the app store. There is a way to cash out. What happens is you find out that you put this into the app tooe, and you didnt do well and want to go on to the next thing. What do you do with that . You connect all the different accounts to us. Your ad Network Account you let us understand exactly how you make money. We have an investment page of one page we have tens of thousands of buyers. They constantly come to our website looking for opportunities. They know that we value all of this data about your app. We try to lower the barrier of entry to get into the app store. What kind of money are we talking about . 10,000, 50,000 . Andhey sell between 100000 200,000. The sweet spot is between 5000 and 7000. What can you get for that . The most popular ones are the casino apps. Slot machines and blackjack. What happens after you buy this app . You dont have any you dont have any expertise but you want to get in on the business. You are buying the code and the design and the assets. You are taking it out of one developer account and putting this into your development account. Of thismaking money off app, and we recommend that you look into improving monetization. Most developers are good at building apps, but not good at buying the apps. They may only show these to u. S. Customers and all the customers are coming in from spain. When someone buys an app, does the original creator get any residual rights, like an author or a musician . Under the completely standard agreement, they do not. Most developers dont want this. This is like their child. They will spend maybe one year with this and they want to move on and try something new, and dont want to deal with customers and the headaches, so the times that we see when shares in residuals is with the apps where they want to have a big part of the upside. You have mark cuban, who is a big backer of apptopia. He is the lead investor. Kiev. , new york, what is that boston, it is hard to start is a community that, we dont want to outsource you. We will give you equity in our company, we will treat you as well as anyone will treat you, and we built a team of completely devoted developers, that kind of lead bleed apptopia. Have you found an app coming to your store that you want to buy . There are many of them. What kind . He sold one for 41,000, called instalaker. On instagram you want people to like your photos. This essentially built a community that says, if you like my app, i like your app. You can get credits to get more likes for your app. These for get one of your anniversary and customize this yourself . Jonathan kay, chief operating officer of apptopia. Next, we have the gentleman behind the Architectural Design of the top Business Schools and microsoft is said to consider molencamp as a potential chief executive. We will have more on i am pimm fox. Taking stock. Do you remember the days when you squirmed around in class, if an uncomfortable chair that was attached to your desk . This was last century in this does not exist, courtesy of graham wyatt. He is a partner at robert a. M. Stern. He has revolutionized colleges around the country, the zoning 17 buildings for Business Schools, with Rice University and wake forest and now he joins o talk about how Design Architecture and learning. We know people can go to school to learn to be architects, but how has architecture and Design Change to accommodate this . The basic premise is the way in which one works in the Business World has changed. In order to be effective you have to learn in a different way in Business School to be prepared. That, what are some of the physical differences that exist for these cases . I have been in your office, which is entirely open, background noise and people collaborating, this is no longer sitsuation where everyone in a row and listens to a professor. This day is done. Is this already the day of the cluster . How does that fit into this conversation . The idea started at harvard Business School where they took the auditorium lecture hall and curved it around into a horseshoe, so the students could speak with each other during class. That is part of the harvard Business School case study, but the next step is to bring the class down to the sub groups so the individual teams of people will work on a project and then they will all report to their professor. That is what this new classroom facilitates. What is the biggest challenge in presenting this new Design Program for what is such a traditional campus outcome . There is a lot of conservativism in the educational field. People like the classroom they are familiar with and are nervous about a situation where they are not in control, so it takes a bit of overcoming that but the most effective way to do that is to take people to see a classroom where this is working. Give us an example you are proud of. The first one was at Rice University, this has become a Tourist Destination in the Business School world, people go down to look at these classrooms and they see how the teamwork that takes place in the classroom is different than it was in the old lecture style classroom. William mary . The big advantage there was having the full integration of whiteboards and projection boards so that you can see both at the same time and increasingly, professors work on tablets, so free agents are Walking Around the classroom. Expensive toy more do this kind of building . The technology is a bit more expensive but the classrooms have a big advantage because during the offhours, this kind of classroom is used. I want to thank you very much. Graham wyatt. A footballe manning, legend. Is taking stock, i am pimm fox. Lets go to mark crumpton. Onin mexico they have voted an end to government control of oil reserves, which will change mexicos charter to allow Companies Like exxon and chevron to develop in the area. According to a report by jpmorgan, this could improve benefits by 15 billion annually. General motors is selling their stake in a french automaker that they received last year as part of an alliance to find savings for both companies in the european market. According to someone familiar with the matter, they will sell at 10shares of peugot euros, to 10. 5 euros per share. Raising 725 million in rke companys ipo arama sold 32. 5 million shares at 25 each. By a groupcquired including Goldman Sachs and j. P. Morgan. The Winter Olympics are just a couple of weeks away. We will look at sponsorship for the Upcoming Games and the pressure from gay rights activists. I will be joined by the founder and executive director of an organization looking to end homophobia in sports. This is at 7 p. M. New york time. I hope to see you then. Mark crumpton, talking to us. Archie manning built a life in football, with 14 years in the nfl. Now he is the chairman of the National Football foundation, and was named the coach of the year in the fourth subdivision of ncaa football. I talked about what he learned as a rebel at the university of mississippi, and the perks of fatherhood, raising his sons, eli, peyton, and cooper manning. We just try to raise good kids, and somewhere around the line, they loved playing sports, with aa lot of sports, goal to play College Football. Peyton played at tennessee and eli at old miss, and they were able to play football. As a former player, and as a father, what about this whole field . F injuries on the tackling in football right now, i understand this. I have some good friends who have dealt with concussion issues, people who have been affected but i think in all aspects of football they try to address that and the nfl is doing everything they can to make things safer. I think that colleges are doing the same thing, with high schools and youth football, to make sure that we get back. I think football is a great game and there are a lot of life lessons there to play the game of football that the game has to be safe. In the highart schools, getting back to teaching the right way to tackle, not just missiles and spears and the headtohead thing. I think that football is addressing that. As they try to get that right, has the environment of playing football changed to the point where this is a commercial enterprise first, and a sport second . The nfl is very successful. If you look at their brand and their product and the number of people that go to games, the corporate people and box suites, to entertain the people, the super bowl and the television ratings, this was huge. The nfl has a great job and College Football is a great institution. I live in the south and a hundred thousand people go to alabama every weekend to watch a college or game. 107,000. Inmany parts of the country texas, they have 140,000 people watching high school football. This is a wonderful institution that has been under but college and the professional level, this is big business. It has created the debate about whether college at leeds should be compensated in some way. I can understand people bringing that up. I am not speaking on behalf of Liberty Mutual. I personally dont think the players need to be paid. Ishink the College Education its own reward and if players go to college and slow down a little bit. Enjoy this college experience. Most players are not going to go into professional football. This is a big journey to play College Football. Enjoy that, your teammates and your coaches, trying to have those good experiences, but the main thing is to get a degree and a College Education and do something later in life. The relationships that you formed in college foot allstate with you your whole life . Four of my best friends and life are guys i played College Football with. I talk to them every week. We didnt win the championship in virginia, but we spent four years together, most of us started dating our current wives at that time, we have a wonderful experience with good traditions at old miss, as far as football. Studied,o class and we and now our kids are friends , ih each other, so this was think that College Football is under attack a little bit but this there are far more rewards than danger. Respond to the notion of the Single Player first is the team. You have to understand that 18 game. Bsolutely this is not always because of one person. I think it is good for kids to play a lot of different sports. I dont think you should specialize at 10 years old. And lets you are a prodigy in tennis. Parents should not get involved in this, trying to train their kid to be the next Michael Jordan because he is good at 10 years old and basketball. If you play a lot of sports this is good. Along the line, if you are playing tennis and golf, these are individual sports. You have to go out there and compete with baseball and basketball and hockey. These are team sports and that is one of the great lessons that you learned in sports, teamwork. Most of the time, that is what we are in the Business World. You are on a team. The people who dont know the concepts or appreciate the concepts of teamwork and leadership, they are not going to be successful in business. My thanks to nfl legend Archie Manning. Vote for the Liberty Mutual coach of the year award, this is open until december 22 at coachoftheyear. Com. Watch the second part of my interview tomorrow, on Archie Manning and his plans to coach in the nfl, and how he caught Peyton Manning and eli manning to be leaders on and off the field. Next, online avatars. Friends,you and your my producers, and me. All of us. Talksfounder of bitstrips about how the instant comic craze became a digital hit. First, bloomberg. Taking stock. I am pimm fox. We have more on microsoft and their attempts to find a new executive. Theyre looking at qualcomm and their chief officer, steve mollenkopf. I want to bring them bloomberg editor at large cory johnson to tell us more. Chipmaker,from a an ip company. One thing that microsoft has screwed up his mobile. They just havent gotten the strategy right and as the world moves away from desktops and onto computing on telephones, the phones have more power than for personal computers or supercomputers from the 1980s. Microsoft has not of alt with this but one company that has is qualcomm. They are a little bit below or little bit above intel, s longterm partner. Steve ballmer has looked down at qualcomm as a company that has changed itself to a company that dominates the mobile computing universe. This is a big, complicated company with an increase in mobile technology. Ceo search, we see the different idea that microsoft has about their future. Alamo was still in the running but the excitement has cooled. They want to suggest someone who will fix the company and get the right priorities. They are thinking of the future andomputing is in the cloud a genius within microsoft can still run microsoft. Qualcommwe hear about in the mix and we think about the future of mobile, outside of our business. Is this usual to have such a public bakeoff about who will be the next executive . She has really powered in the pavement to find out what is going on with these discussions. Acrosoft has given itself full year to find a new ceo, when the call went out in august or september but they want to get this done before the holidays. There are other outside candidates and we dont know who they are. If anyone wants to call me and tell me, just between us, it would be helpful. One way that they can lobby to be the chief executive, any of these individuals is follow the french politicians where they use the online comics. There is a company that does such a thing. This is a company that hit it big on facebook, a company known as bitstrips, is blowing up. Users have created 30 million avatars of themselves on this service. Itstrip . A bat joining me is the cofounder and chief executive, jacob black stock, known as bob. This is a nickname i have had since i was six years old. Been doing these comics since you were six years old. How did you get to the world of technology . I have always been interested in technology and comics, i have been making animation since i was a little kid. Friends, we with my put each other into comics, to embarrass each other or get each other in trouble at school, and basically, that led me to the idea of why can everyone have that kind of fun that we are having. Eventually, Technology Got to the point where they made it possible for everyone to put each other into comics. The experience of art is so often in a dark room, a solo practitioner. People if the darkest have ever met. Everyone has left that out. Say that i want to do a comic using your physical image. What would i do . I would come to your website . We would have to be friends on facebook, you can only use your friends characters. You visually communicate and interact with your friends. Lets assume we are friends on facebook and i have gone to the app store. I have gone to the app store, this is the place i go to download this. This has helped your business . People have districts and their bitstrips in their pocket and if you are at the coffee shop or trying to hail a taxi, you say that this should be a comic. Do that lets you instantly and because of that nature it has gone viral across the world. You take the picture from your phone and it converts into an illustration . You have about 2000 scenes we are adding to every day, and if you and your friends like the classic man on a desert island. You are the man on a desert island. How do you make it look like a person . You get to choose every different person. Children can decorate different individuals and the haircolor, eye color. You can create an avatar. This can be however you want. This is not just a drawing of like ais like over living, breathing character. You can really use this to convey anything that you want. But this is not comics when it comes to investing. You have horizon adventures. We were just announcing this today, we closed the first round of funding and the private Investment Firm of lee caching shing, their pedigree of investment includes things like facebook we are not we could not be more excited to be part of this. You have been on facebook for four or five years. Bitstrips has been around for five years and we Just Launched on facebook one month ago. This is amazing. Andaunched this on iphone this became the number one app on the app store. Months,ted number 1, 4 becoming number one in 40 countries around the world. With 90 countries and in less than two months we saw 30 million avatars. Have you considered revenue . We have ideas for that but right now we are focused on making the experience the best possible experience. We were in stealth mode when we launched and did not tell anyone about this. I can tell where the comic is going to go. You can put cory johnson in that one. The bitstrips executive jacob blackstock. Known as bob. And this is cory johnson. Coming up, we tell you about the restaurant with a fiveyear waiting list. You have never heard of it until now. This is next. This weeks bloomberg businessweeks etc. Section features a restaurant that is no longer a secret. Emma rosenblum joins me to unveil a secret. This was a secret, you have to book five years in advance to get into this restaurant . This is booked up for five years and you can send an email to them to get a reservation but this is hard. Tell me about the name of this restaurant and who is damon barrell. This is in upstate new york about three hours outside of manhattan. Damon is the chef and the owner and the waiter, who does and gets allmself the food from the land he owns, he makes this in his yard and serves 18 people every night. What do they eat . Molecularnto gastronomy, using dehydrated ingredients and advanced techniques. He is not trained as a chef and has taught himself to do all of this. He realized his career in the world of motorcycles was not going to take off because he was injured. He decided to move into this spot. He has been rewarded with several awards and is highly rated by culinary experts. Sinces has been going on 2006, he has had the bistro. Now the larger food world is starting to take notice. He has an independent spirit award this year. He serves a kind of ice cream or sherbet of some kind, but he takes this from the roadway that is outside of his house. He calls this an acorn ice cream cone. It takes one year to prepare. He forages the acorn and submerges the ministry and for a few months, he takes them out of there and does some other things before they get dehydrated and ground into a powder that he uses in this cone, and he puts an eggplant thing on top of that. He does things with stems of them. S, liquifies he uses this and other presentations. Celebrities come in and try to get reservations. Wantingas are reservations. He is very protective. Jerry stewart and seinfeld are big fans. And there is a fiveyear waiting list. The food that you eat may be preserved somewhere for years or never made. What does he say about, if this will be a job for him in the future . He is 51 years old so he stopped taking reservations past 2018, he is not sure that he may retire. You may want to try to get in now. Thank you very much. Rosenblum. Um emma 104, theones is down s p 500 five spice six, and the nasdaq falls by five. Live from pier 3 in san francisco, welcome to the late edition of bloomberg west, where we cover the Global Technology and Media Companies that are reshaping our world. Im cory johnson in for emily chang. Our focus is on innovation, technology, and the future of business. Lets get to the rundown. We have just learned a new candidate to replace steve ballmer, not exactly a household name. Johnnycomelately, that is
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