Entrylevel software skills. The first of its kind, students pay 200 per month for the courses, which are designed to be completed in less than a year. At t is offering paid internships to some graduates and a shot at entrylevel software jobs. Dreamworks animation has launched dreamworks tv on youtube. The channel is aimed at younger viewers and will feature original liveaction and animated programming. The project is being led by a company that dreamworks paid 33 million for last year. Now to our lead story of the day, growth is slowing and ali baba, which has some investors worried. Theyre updated ipo prospectus shows slowed sales in the Fourth Quarter compared to the year before, when margins were also down, dropping from 51 in the was earlier as the company forced to spend more to attract mobile users. The amended filing also names the 27 partners that are part of the companys unique governance structure, something that made the company choose to lift in new york over hong kong. For now we are joined by Leslie Packer and cory johnson. They also broke out sales for the first time, one of their first criticisms tom a that the numbers werent there. What jumped out to you . There was not a lot that surprised me quite a bit. We do get an investor reaction, d. You reference we can see the way the market might be thinking about these numbers and what their optimism might have been, which is that of numbers continued to go straight to the right forever, they are not. Shares are down five percent now. Growth is going to slow down at some point, and you can see that in these numbers, but generally speaking those numbers are then passed it. The size is great, the profitability is great, it is not worth anything that we can see it is worth something. Would you echo that . We are seeing a near tripling a profit on an annual basis. On an annual basis the numbers look quite great. You have to keep in mind that the Fourth Quarter, the one that ended in march is seasonably weak for a Commerce Company in china because it is coming off the Third Quarter ending in december, which ali baba hosted 36 billion in sales. The next quarter that comes after that, you can expect to see a dropoff. The slowdown in growth came from the First Quarter sorry, the Fourth Quarter 2013. That was a little bit slower. Once you take into account all of the spending that took lace before that, it is no surprise that you will see a bit of a trailing off there. It is interesting, cory, when you compare them. Taubau, but from tmol is growing faster. If you compare that to amazon, that is just 100 billion in sales transactions. Those of the gross volumes, not what actually flows down. Right, but it gives you an idea of how much business they are actually doing. What we saw was less or reference to the yearoveryear growth rate slows down quite a bit. It is important, you know, i go back and fourth about whether or not they are using sequential or yearoveryear, and that is important because of the seasonality of the business, where Holiday Shopping can be such a big deal. Saw 39 in yearoveryear sales growth, the slowest yearoveryear sales growth we have ever seen from the limited numbers we get out of this business and it is worth noting that it is not up and to the right forever with a lot of acquisitions baked in. There are some ties back to the kinds of acquisitions they have done and the chinese economy, which is a much bigger part than anything is in the u. S. Economy. For example, two percent of the chinese economy close through alibaba. Compared to the. 02 or walmart in the u. S. There is really no better comparison. As goes the chinese economy, so will alibaba. At least so far. We have more information about this 27 Member Partnership that will be electing the board. Any surprises, leslie . Like this is obviously important for investors, this is their version of it youll cost share structure. These 27 members will provide significant control for the company. One surprise was actually that 28. As 27 members instead of in the initial filing they said it would be 28 and that the number could fluctuate, so the final number came out to be 27. In my opinion one interesting aspect is that nine of the 27 were female partners. Something that was a bit of a surprise. Most of the members, of course, our executives within the company. No major standouts, but it is nice to know those names into those people are, their backgrounds, of course. Any updates on timing . When are we expecting this to happen . It is nice that they were able to come out with this filing today, it shows they are on track or a potential august debut. One of the major holdups would be this backandforth with the sec, which we dont see in the public spotlight, we just see the revisions. It is only after they go public that we will see their actual questions about the initial filings. That is one of the things that could you lay it until september. They are of course also paying close attention to Market Conditions. The fact that it came out today means that they are probably still on track to do in august debut as long as the revisions continue in this pace and manner. We have been talking a lot about the public tech markets recently. Is ali baba in the league of its is so big . It or will they suffer the same Market Conditions . When it is too late from anyone for anyone to benefit from what they were trying to hide or did not want to reveal, or the sec had questions about, those will be worth looking at after the ipo happens. With a cursory look at the numbers, the Gross Margins, which are spectacularly over 70 , did not get worse yearoveryear, the first time we have seen that happen. One of the interesting things about this business is that the margins were Getting Better and on a yearoveryear basis if you look back you will see margins at 74 with a four percent decline in the yearoveryear basis and you can see a consistent trending change. Again, the numbers are so good that they are consistently getting worse. You could see them wondering at what point does price start to matter . With lower Gross Margins reflecting that. Given what cory said earlier about the uniqueness of ali baba and how much the chinese economy actually captures, what are investors saying to you . It is going to be so massive. We are looking at a 20 billion ipo coming to the u. S. Regardless, every investor will have to take a look at it no matter what, because it is so massive that many people will have to look at it in terms of hitting it into their portfolio to reflect what is going on in the overall stock market. That said, people are still very excited about the growth. We are looking at incredible margins, incredible growth, and it is not something that is necessarily a red flag to investors. It will not necessarily scare anyone away right now. Every Company Becomes slow in terms of growth at some point, but it is still the unique play for u. S. Investors in terms of the chinese economy, making them take a closer look. All right, that leslie picker and our own cory johnson, thank you both. Still ahead . Want to work at at t . May besity udacity able to help. On you can watch a streaming your phone, tablet, bloomberg. Com, and apple tv. I am emily chang, this is bloomberg west. Twitter is dealing with a gap in the ranks of departure from its executive. First, Michael Sippy and chris fry, then the twitter coo allie wrote on he resigned from the head of north american media. How will this impact their business . We recently caught up with greylock. Josh formerly served as the product lead at twitter and we got his take on the management mixup. If they are not functioning well, it can hurt company innovation, even if there are just great engineers and designers around. When things dont seem to be going well in some respects, it is such a central role that sometimes changing it out will help you to give a new or different shot. Before that he also worked on the platform at facebook. We asked him what he thinks about facebooks recent purchase of whatsapp. Facebook is a place where we are with our friends in meaningful ways and they are one of the other companies i forget the numbers, hundreds of millions of people communicating with their closest friends and family every day, i think facebook will be able to bring that into the product where one part will be to medication, another part will be sharing photos, stories, and their lives through the core product. Return now to the future of Online Education. At t has teamed up with udacity to offer a new Degree Program focused on entrylevel software skills. They say the new degree will be offered online, 200 per month. Theid internship at at t is payoff for graduates. The cofounder and ceo of udacity opened us earlier today, he is also part of google ask. I started by asking him to explain exactly what a nano degree is. Short degree, very focused, directly meant to employ the skills to find a job. At t is the initial partner here. They are helping us to build these degrees, but they are also putting on the table employment, saying that these disease have the same value as a degree that is faster and cheaper, with the top internships for the program. Who can apply for this degree . Who can get into this program . Anybody can. You have to be good at math and so on with some basic computer science, but once they get to the education they get to a sought after job, a mobile salesforce, so, autodesk, other companies have endorsed this. Do you see partnering with them in doing something similar . What other companies could you partner with . We have a lot of announcements coming up and we hope that this will become an industrywide standard. In this day and age we hope that learning will be lifelong. Things move so fast, you need to stay engaged and put the skill throughout your lifetime. It would normally take 15 to create more nano degrees. Sebastian, you invented the google car and are a founder of google ask. How do you apply that moonshot they thinking to education . Forducation is ripe innovation. Students need more options than they had in the past. We have one trillion tools, college debt, young people not finishing their degrees. More so people in an advanced stage of life have no credentials that allow them to learn from home flexibly and in a focused way. I believe that they can create options for people in all walks of life so that you can have a tremendous impact to society. A lot of people are extremely talented, but to unleash their potential into a new career, they need the dedication that will this will provide to them. Othercifically what industries can you see this idea of a nano degree applied . Given how big the skills gap is. Pretty much any industry. We are starting with Computer Technology it does it is where Silicon Valley is, but there are other fields that could focus and benefit from a very focused education. You have a partnership with georgia tech. You can get their prestigious pewter science masters degree for 6,600. In the future do you foresee partnering more with universities like that . Didompanies, like you today . We are very proud to have partnered with those companies and at t has been the signature sponsor and lower the tuition fees. But i think you need a lot of creativity around core principles. What is acquired required to get a job . Are lifelong learners, you dont need a four year or two year degree, you need something very focused. By doing it and a focused and fast way we hope to empower people to change their careers much faster. You are a professor at stamford. I recently interviewed john hennessy, we talked a lot about Online Education. He does not inc. An Online Education will ever replace a Traditional College degree. Never a Traditional College degree. How do you respond to that . This is not a traditional degree, it is much more focused on the short much were focused on the shortterm and we should remember that. That we should all remember the days of the libraries, when librarians argued it was important to physically sit and read that book, but the amount of knowledge acquisition and inquiry has gone up to factors of a thousand. There is more potential for people engaged in Higher Education because they dont have to go to campus, for the most part. Tomorrow you might just do it on your cell phone. At was the cofounder and ceo of youth density youthdacity. Credit card hackers may be trying to steal your goal records, next. I am emily chang. This is bloomberg west. The fcc is investigating controversial deals between some of the Biggest Companies on the web. Verizon, and netflix. Reacting to a flood of consumer complaints over the speed and quality of broadband connections and the latest salvo in the fight over Net Neutrality. During this socalled last mile, the fcc is looking into whether consumers are receiving at the higher speeds. This week we are looking at how technology is changing health care, moving medical records onto computers and tablets made life easier for doctors, but the shift poses new security and privacy rules for patients. How secure are these records . Is enough being done to protect them . We have the coverage on siebel six Cyber Security in the digital age. So, hackers want my medical records . Why . Not for the reasons you might suspect. We are all concerned about them accessing our medical records to learn of our medical conditions. It is for your other personal information, to commit identity theft, for the most part using your name and Social Security number. That is all in your medical records. Doctors offices and hospitals are prime targets for hackers. For the same reason they are trying to get our credit card data and Everything Else . We have not seen much use my hackers of the medical information, though you could see while why it would eat valuable, blackmail and things like that. Another shift has been the one to electronic records. Hackers will break into hospital and doctors offices, encrypt the patient records, and then demand payment for the keys to unlock it. It is a new kind of stress that we have never faced before and if you dont do security well enough, you could be in big trouble. How often does this happen . Like that happens rarely, but we have seen it in a few places. Otherwise, electronic records are dangerous in that sense. I think we have all experienced the difficulty that our doctors offices seem to have been shifting to the digital age. Are they adopting better security protections . Is the government helping at all . They are. With the Affordable Care act there are requirements and penalties for not adopting those. We can all agree that the shift promises some substantial gains for improved care and quality of care. I think everyone is on board with that. With that comes security requirements. The government is stepping up its policing and enforcement, which had been fairly minimal before this. It was only the providers themselves and anyone else who had access were not really least , but the biggest threat is almost always going to be the insiders. Identity theft rings almost always have an insider who feeds them documents, information, and access to the computer system. Nowhere more than in the medical profession is that a big threat. How do they get an insider . Usually someone who is corrupt to begin with or did the job is and administrator or as someone with access to sensitive networks. Because the Healthcare System is so big and there are so many players, it can be easy to get access to the system. You will not see target like breeches on the time, but there are lots of cores. Another thing to be worried about. Thank you so much, we will be right back with more bloomberg west. Is 26 minutes after the hour, bloomberg tv is on the markets. If you take a look at where stocks are trading, not much change in the overall market. A bit of an upward iis after reduction numbers Beat Estimates in the rack, wishing higher with oil prices and bringing limitation to the game today. More on the markets in about one hour. You are watching uber bwest, where we focus on the future of business. The San Francisco giants are leveraging their relationship with the Tech Community both on and off the baseball field. In addition to using technology to track and improved player performance, they are keeping an iron the recent tensions between the Technology Industry and local community. In part two of my interview i started by asking him how recent debates over technology and inequality have impacted the team. Take a listen. As a Baseball Team we have a chance to sort of take a whack at that inequality in the sense that i see our all park and ballparks around the country as kind of town centers, where people come together. During the world series i see Hedge Fund Guys sitting next to 14yearolds from the boys and girls club who happen to be at the game together. I think that what we provide in baseball, as we have a lot of games and have had the ability ats week we have tickets eight dollars. I think that what baseball can provide is a coming together and melting pot, if you will, to take a whack at that inequality. A lot of the bay area sports teams are moving around. The warriors are trying to go to mission bay. Does this affect the giants and giant fans . When we started one years ago, we were the team in flux. We were the team that did not have a home or a future, potentially, we almost moved to florida. We are stable. What is going to happen in the bay area is that with all the economic growth, there is room , a prosperousams nba team and prosperous nhl team. There is plenty of disposable income and Economic Movement for that in this community, but you do have to have a place to play that is compelling. I think that what we found is that in todays world with so much competition for the , if you are inur a substandard stadium or arena, it is hard to take that and make that for our investment. By the time you get on the car get in the car, get in your bicycle or scooter, by the time you go to the ballpark it is an investment in time, so you want it to be a compelling experience. Speaking about sports and affiliate fees, there has been a discussion that fees are too high and that costs are being transported to the consumer does they dont want to pay for things they dont want to watch. Would you be open to a format in which people pay for giants games only if they want to watch them . I think the bungled approach works. You have to be responsible in your pricing. Some teams in some communities are not getting distributed right now, the pricing does not work because the price went to the team and then through the distributor, people have been priced out. Be priced outight if that was passed along, but i think that responsible not reckless, but responsible pricing of the bundle allows the system to work well and there is no reason the bundle cannot work. No, i to that question is dont think we need that kind of a la carte system. What is the way for Major League Baseball to take advantage of this digital age . I think we are doing a good job with Major League Baseball advanced media. We just need to keep moving. If you stand still, you lose. We need to keep innovating and figuring out ways to talk to the 12 to 17yearold. They are getting even younger, the eight to 17yearolds. That is where the habit for the consumption of media is so different than it used to be an we have to make sure that we understand that. Someone working six blocks from our ballpark at twitter is not checking out at 6 00 and going home for dinner and logging in. What they are doing is at eight they are checking on their giants and then checking in on the handheld or pad, wherever, tablet. Got to be able to get that information to them in a compelling, concise, and entertaining way. If that does not happen, we will be sacrificing younger fans. Are you aware and concerned about people circumventing rules on blackout mlb. Com . Look, cord cutting, all of that is part of the fabric. Sure, we are concerned that we want to be able to have packages that are officially and legitimately obtained, but i dont think that the problem is so large that it has been affecting us today. I think we will have to authenticate in real ways so that everyone is patched in in legitimate ways. Question, the niners are doing well, but have not won any championships. The giants have obviously won two in the last few years. Is San Francisco a baseball city or a Football City . When we bought the team in 1993, people said that this was a football town. Quite frankly, we are now in a mode over the last 20 year odyssey with several years of sellouts in a row and a couple of championships that we are as much a baseball town as a football town. That is very diplomatic. It think it is both. It is good to be both a baseball town and football town. The San Francisco giants ceo, larry there. Whether it is new york, cupertino, even london, what does it take to attract top talent and startups to your city . We sit down with Boris Johnson for an exclusive conversation, next. I am emily chang. This is uber bwest, streaming on your phone, tablet, and bloomberg. Com. Bloomberg kicks off London Technology week with a technology summit. Michael bloomberg and the mayor of london, Boris Johnson, sought down with joss for a conversation on the state of the Technology Sector in the capital of the u. K. Top discussed the draw for Technology Talent in europe. Take a listen. That local government can provide lots of the conditions that make it attractive for Technology Entrepreneurs to live here. The crime the rates are very low in london. Mass transportation, lots of things that you can do to make it attractive. And then things that you cannot really do, politicians tried to have the vibe, that is what people come for. You and i, we have to be careful that we dont interfere with the vibe. Creative people want diversity of interests. The fact that london and new york are cursed Cultural Centers is attractive to them. If you go to places that are quieter, with last night versions, you would think that they would be more productive, but that is not where you get the best and brightest. The best and brightest want to be a big fish in a big pond. They want to be able to have access to different cultures, cuisines, religions, languages, different ways to address. They also want to be in places where there are lots of other Just Technology is not enough. Medicine,off fashion, you have to have the whole picture if you are going to be successful and in all fairness, london does, so does new york, there are other cities that do but not to the same extent. They also have great time zones for dealing with a big chunk of the world. They very much resemble each other, like nuclear reactors. There is massive talent. Bloomberg lp founder, michael bloomberg, with the mayor of london this week. Michael bloomberg is the owner of bloomberg television. Why in back now to our the world series, where we look at how technology is. Fusing technology and medicine has allowed doctors to treat patients with the most sophisticated and durable life durable devices available, but it is not always easy or simple to get this equipment. Aptitude, out of texas, is trying to change that. They describe themselves as the amazon of medical devices. And general manager joins me now and our studio along with our editor at large, cory johnson. The amazon of medical devices, what does that mean, exactly . Of business marketplace focused on helping hospitals suppliers come together to do contracts for health care supplies. Hospitals have to source tens of thousands of different products in support of patient care. To manage the costs associated with these products, they use purchasing contracts. The process of adding for those contracts can take anywhere from six months to nine months. This takes a Market Driven approach to inform hospitals where the supply cost of change based on the markets and give them the opportunity to automate the bids and measure the performance of the contracts over time. Process so long because there are so few major suppliers . Striker with 9 billion per year . That they want to get everything under one nonrelative . Obviously, the clinical performance of a product is major in the ultimate decisionmaking around that rodarte when a hospital makes decisions about what they want to purchase. Ultimately the process is long and painful because her choosing data and health care is hard to get a handle on. Hospitals or suppliers . A both. When you look at places where you have standard codes for ordering products, like walmart, knowing how much you are spending, that is difficult to do in health care because of the lack of standardization. Sourceour end how do you this . With Technology Changing so quickly i am sure that options are const we changing. Yes, they are. The Market Driven approach really brings a demand driver. Ultimately when hospitals are talking with sales reps looking at latest technology, that is what they will be automating through the process. The hottrailer trend in hospitals 100 years ago was goat. That so much now. I imagine that you can see the greatest trends. A great question, not one i am an expert in. Ultimately i could say that we see the focus for these categories as extreme, mostly because that is where the cost is. Plant of all devices. Think about pacemakers, spinal implant spinal implants. Ultimately be think that that is where we can help to bring down the costs. Where are you seeing the most innovation with the most rapid taser change in terms of what is available and what providers should be using in terms of products escher and mark in terms of products, types of medical care. The bleeding edge, from my perspective, the divide space. That is where we see the continued tremendous investments, etc. It iss where i think challenging for hospitals, to make sure they have the latest and greatest products with a good price and good manufacturer. How responsible are these hospitals . I am sure Everyone Wants to upgrade, but it is more expensive and an inconvenience. When you think more about business applications, the bar is not that high with relative to easeofuse. We have taken an approach to make it feel like amazon. When we talk about the Amazon Health care supply chain, that is what we are referring to. It is as simple as using your computer at home to buy products. This was built into the system. Meaning you are not taking inventory over. Look, whereen you is the greatest amount of waste . Where do you find the greatest opportunity for margins . You mentioned signing contracts, i bet you could take some cost . We have seen an 80 reduction in the cycle time. I think a lot of that activity is tied to legal negotiations. When hospitals contract rectally for supplies, you have to get the lawyers involved. Lawyers are adding to the cost. They certainly have overall. Takes a market approach. We establish a prenegotiated procureonditions to under. With that we are able to come together much more rapidly. All right, thank you so much for joining us. The amazon of medical devices. Well, dreamworks may be known for its animated films, but today they Just Launched a new Youtube Channel. We will tell you about their egg push into digital, next. Welcome back to bloomberg west, that was shrek in his new role as a blogger. Dreamworks tv, a Youtube Channel and that young viewers who are not touching traditional television. Jon erlichman joins us from l. A. With more on todays new hollywood. Following the dreamworks purchase . Right . Definitely. It was just over one year ago the dreamworks acquired awesomeness tv, which basically brings together all sorts of different Youtube Channels to create a multichannel network. Obviously, there has been a lot of focus on where people are watching television these days. In the case of dreamworks it is a company that has been viewed thinking about the future of its own business, which is why they have been fairly proactive in finding new homes for their content, striking deals with netflix and in acquiring awesomeness tv they were trying to make a bet on the future to figure out what it will all mean for them. One year later there had been some discussion that with the help of awesomeness, knowing a lot about teenagers, they would launch a traditional cable channel, but in the end they went online. Who knows, maybe they build an audience here and they can take it to cable down the road. Disney also recently bought maker studios. How does this all come together . It is fascinating to look at these deals. They tell you that hollywood is thinking a lot about the future. Whether it is dreamworks or the disney acquisition of maker studios, or even warner bros. , who took a significant stake in a gamb Gaming Network channel called machinima. You realize that hollywood is interested in the new landscape and the key players, these youtube stars, are just as equally interested in hollywood and the media. If there is ownership from big media they know that there are new ways for their voice to get out there in bigger ways, to make more money. I can tell you there is a growing list of youtube stars making their way from the bedrooms where they were bloggers to hollywood. John, of course youtube has been trying to cultivate more of these channels and get more companies to focus on Youtube Channels. Specifically how has that in working out terms of the is this of youtube . All of this stuff is generally good for youtube. Generally speaking, youtube has embraced all of this. They loved to see these new networks, what are being described as these new cable. Hannels being worn on youtube i think there is still this issue of frustration from content creators and multichannel networks. At the end of the day, youtube, if it is an advertising business, youtube takes a huge cut of the advertising dollars, alternately. We have seen some push from these players to maybe build an audience through youtube then go elsewhere with it. There have even been discussions of yahoo , for example, trying to launch its own youtube kind of service. All right, jon erlichman. Hang on, time for focusing on a. Umber that tells us a lot this is a big one. 6,915,000,000. The current enterprise value of time warner telecom. Separate from Time Warner CableTime Warner Cable . Right. They kept the hbo business years ago, but now they have spun off. This is an Internet Service provider focused on business. Vehicle ira, level three, is one of the largest internet act companies. This was long thought to be a target of comcast. Direct tv might be happening, level three acquiring this telecom means that one of the biggest backbone companies is trying to acquire one of the biggest Internet Service providers. More consolidation within the industry, allowing one company to control things from stem to stern in terms of innovation across the internet. Much movement happening in this debate in the arena of Net Neutrality and the sec looking into the spot between netflix and verizon. How much are people in hollywood paying attention . They are watching. Cbs, nbc, they are all customers of level three. The reaction to the deal was that it was good for level three, but what the businesses part of theng is same conversation that netflix might have about what they have to pay comcast for access to broadband. Imagine netflix or hulu, looking at it and saying that you have a deal to get information out faster to get ahead of us, now we can pay level three or we lay pay level three to get those services out beyond that. That is the kind of thing that a get this to allow to deal approved. All right, george cory. Ohnson, thank you thank you all for watching bloomberg west. We will see you later. From bloomberg or when bloomberg World Headquarters in new york, im Mark Crumpton and this is bottom line. Iraqi forces fight militants as mr. Almaliki says his army is gaming ground. Highlights of tom keenes interview with Christine Lagarde is gaining ground. The audi r8ok at sports car. Viewers here in the United States and those of us joining us from around the world, welcome. We have full coverage of the