There is no doubt, thanks to the steps that we took early on to rescue our economy and to rebuild it on a new foundation we are entering the new year with new confidence that america is coming back. Tomorrow the president heads to phoenix to talk about the state of the housing market. The sec chairman said his Net Neutrality proposal will line a linealign with president obamas vision, meaning no internet fast lanes. He said will be no blocking, no throttling, and no paid prioritization. The proposal will be formally submitted in february. Three of the five members need to formally approve the plan. Tomorrow i will be speaking with one of those members on bloomberg west. Is facebook a serious threat to Googles Youtube . Facebook said the amount of video on its news feed tripled from last facebook has averaged june. More than one billion video views per day. Facebook is looking to take a bigger piece of the online ad marketing space. Now to the lead French Forces are reportedly raiding a site as they seek to capture the gunmen responsible for the terrorist attack at a satirical french newsmagazine. The suspects reportedly fled about 90 miles northwest of northeast of paris. After opening fire at the offices of Charlie Hebdo, killing 12 people, including the Magazine Editor and two policemen. French president Francois Hollande declared tomorrow a day of national mourning. Today is the entire republic that was attacked. Republic is the freedom of speech, core alyssum, democracy. This was the assassins target. It is that ideal of peace and justice that france carries out everywhere, and this message of peace and tolerance that we defend with our soldiers against terrorism and fundamentalism. No one has claimed responsibility, but the attack is believed to be the work of islamic extremists. Joining us is Caroline Connan from paris. Thank you for working so hard on the shocking news. What is the very latest . There are police situations in the city of reims, northeast of paris in the champagne region. At the moment, according to various french media reports there are between 10 and 20 police cars is going around undercover trying to find these three suspects. Journalists have been warned by the police that they have to be very careful because until the suspects are arrested, there may be some more shooting happening. So the story may not be over quite yet. The police lost track of the three suspects earlier this morning in the 19th district after they shot 12 people dead at the Charlie Hebdo headquarters. We also have information about the background of the three suspects. According to several media reports, two of them are brothers, 32 and 34 years old of french and algerian descent who came back from syria over the summer. The third one is purportedly the driver who helped them escape from the Charlie Hebdo headquarters, possibly an 18yearold homeless man from paris. This is what we know so far. The police raid in operation is still underway. What do we know about the city of reims and what that may have to do with this . Im sorry, i did not catch your question . What do we know about the region where the police are right now . What do we know about that area and the people that are in it . The city of reims is not known for especially violent background or anything. It is not what you may have in your imagination. It is further out. It is more the countryside, in the champagne region. It is nothing to do like what we saw a few years ago where you had cars burning in the suburbs of paris. This is not that kind of area. It is much further out, much more in the countryside. The notion these could have been people who fought in syria is sort of the Worst Nightmare of the people leaving, particularly france, who has the largest Muslim Population in western europe leaving to fight and coming back with both possibly the training and ideology hardened by battle. Of course, and the problem is france has been under threat already for the past few weeks. We have already had two smaller terrorist attacks happening near christmas. Some extremists, some terrorists driving into a crowd at a christmas market, also attacking some policemen just a couple weeks ago in different cities across the country. There is this antiislam fear around the country, and this incident will not help the antimuslim feeling. As you were mentioning, with 5 million muslim people in france, the most important thing right now for the government is to calm down and Show National unity and to not mix the peaceful Muslim Community with the terrorist. Thank you very much. For more perspective, i spoke with bob milton. He is retired commander of the u. K. Metropolitan police and asking how this attack may be different from other attacks previously seen in europe. I dont think there is a massive difference. I think the response to the 2005 attacks in london and the response to this attack will be very much the same. The Police Agencies and the intelligence agencies will want to identify these people as quickly as possible and will use a whole range of methods to do that. It is important that the public will be vital to providing information. What we need to do is track these people down, find out who they are, and monitor supporters from in france, are they getting support from overseas as they claim from al qaeda in yemen. We are already starting to see a lot of that. In 2005, the smart phones the cameras, the videos everyone carries now are not as prevalent in 2005 as today. We have that today. We have seen pictures of the gunmen. Is that going to help, because these guys wore masks and had this carefully plotted out. What is going to help is all of the video cameras by the members of the public, but more important the cctv cameras will help us track how they got to the scene and how they got away. It is one of a number of things that the police and security people will be doing. I was just picking up something your correspondent set in paris said about paris about the repercussions to the Muslim Community. This is something the police are very much concerned about. Will the rightwing take it out on the moderate muslims were clearly not involved in this at all. You talked about cctv. I know that london is rife with cctv cameras everywhere. Is paris similarly saturated . I should imagine so. I dont have firsthand experience, but we work very closely with europe. Europe learns from what london does, with the u. K. Does with cctv. We have facial recognition software, we have very good automatic number plate readers right now. We can track vehicles easier than in the past. That is how we tracked the london bombers up to the leads. The technical leaps we have now have moved on and hopefully they will help the police in their investigation. What kind of thing will the police be doing right now . We know that the gunmen ditched their car, that they jumped into another car. What will they be doing with that information on the ground right now . Well, the senior investigating officer in charge of this will have a number of key strategies. The first one is to identify who the suspects are. So there will be a lot of work trying to track them back to an address to see where they came from. Is that address a bomb factory are there firearms . We need to neutralize that as soon as possible. We will also be looking at gathering evidence from the witnesses. All the people who saw what happened will be interviewed in the evidence gathered. The video on their phones will be seen. There is a whole range of other things they will do to try to protect the country. They will close borders. We dont want these people escaping. Because europe has a euroborder, the u. K. Is separate, but the rest of europe has one single border, so they will have to work with european allies on this. We have seen a lot of cooperation already. Thank you, bob milton. Bloomberg west will be right back. The future of paytv is a hot topic at the Consumer Electronics show. Dish kicks things off with a streaming bundle, offering content like espn online. And Charter Communications teams up with cisco to offer cloudbased programming that they will be able to update via the cloud despite the set top box. Charter has the content, cisco is providing the networking and data centers. Could this be the future of paytv . I spoke with cisco about this. What we have done with charter is exciting and is really a combination of all the things we talked about. Video is moving more towards a cloudbased video delivery model. Charter is offering a new experience, leveraging the technology element, as well as offering the ability to move towards new experiences both from the software and user guide, but also with the settop box they will deploy. When you say leveraging the technology, what are you talking about . What kinds of technologies are required to make this work that were not available five years ago . Sure, there are a few things. First is the ipbased network for the foundation of what needs to be done. The second is you have to be able to render the video from the cloud. Instead of doing the video transformation inside the home you are actually doing the video rendering from the cloud. That means charter can deliver this experience using any device that they have. The 10yearold device they have been putting inside the customers homes or the ones they have been putting in the past few years or the new ones. Newer devices will be 4k capable with multiple tuners. If you have five televisions inside the home and five programs to record, you can do that with one device. Those are the abilities of the new platforms also. The cloud rendering is interesting. The reason cable boxes render on the box the Computing Power required to turn bits into video is so massive and you can move more along the pipes when it is just digits, now just rendered video. What has changed technologically to make sense of rendering on the cloud . A lot of the video processing capability, the Cloud Computing processing capability, as well as some of the technology about taking video streams and putting in them into ip video streams and putting them into a thin client. You do not need as much Computing Power in the home. You were doing more of the processing in the cloud. In addition, software, downloadable Security Solutions which we can actually deliver to the residential gateway from the cloud. A very interesting capability. Also, Digital Rights management. Both very important for charter and the rest of the industry. Lets talk about the rights issue, because its such an interesting and archaic thing, the way they think about things in the way content providers protect their content from potential users and strike these deals that do things like people keep people from being able to watch espn online. Dishes trying to do Something Different like that. When cisco approaches this business, how do you try to get around Digital Rights issues and content licensing issues . From a technology standpoint any service standpoint operators like charter want to be up to take their content and services and be up to offer them on any stream. That is what charter is being able to do. Clearly there are rights managements they have to work through with content players and having the right solution for that makes them available impossible to be up to make these capabilities. A very important issue for the industry that requires a solution that we are working with charter on. Absolutely right in terms of what youre saying. Doing that with multiblasting is exactly what this is going after. I was thought a fascinating part of ciscos business is be feed the new technologies that will sock bandwidth, whether it is the flip phone of yesteryear are this. Is this part of that, showing what can be done so people are just doing more online, more networking, more cisco boxes being slung around the universe . As we go back a few years we predicted that video is going to be very predominate across the industry. Video is becoming the new voice in terms of communication and collaboration inside enterprises, inside the consumer world, and it is gaining more capability even as entertainment video gets delivered. Not just from professionally organized content but even personal content being generated. Whether it is through personal handheld devices or mobile devices or gopro, etc. All of that content is being generated with very high quality, 4kcapable, being delivered to any user on any glass, that is what we are starting to see now. Up next, instacart raises more than 200 million. We will talk with an early investor, next. Im cory johnson, and this is bloomberg west. Instacart is the start up that promises to deliver groceries from your favorite store in about an hour. They have raised 210 million from investors. A personal shopper partners with whole foods and costco, but this latest funding round is interesting. They have some big competition. I will speak with the instacart investor. Instacart is interesting because you have these really important partners that instacart is enabling to deliver. I think of the analogy of the casinos in the early 1980s. The casinos had a lot of people coming in and out and did not know who they were. They actually created cards. Now instacart is able to give Grocery Stores data that other companies cannot capture. A popular company in the johnson household. I also got a instacart delivery yesterday. I did the whole thing, put on the green tshirts, delivered groceries. Its interesting, these Big Companies like whole foods costco are not trying to do this themselves. Why not . Its hard for a Large Company to go out and do it. Instacart has a different model where they are bringing together a marketplace a firsttime shoppers, maybe they have different jobs, more flexible hours, and they are pairing it with different kinds of Grocery Stores. So they are not holding inventory. They are not holding inventory, they do not have warehouses, they do not have employees, they have an uberlike model where they have regular people. It is an open model like uber where the kicker uses a smartphone and uses their own car. Absolutely. They can login and logout. They may have different jobs. What you are really getting is this idea of being able to deliver something to somebody and capture that data and create that customer relationship. The other piece that is a key strategic advantages they are already profitable, but you can also start to spin up newer cities faster. They are already profitable . Really, thats interesting. Is that what you want this early in a company . I dont think it hurts especially in this kind of environment. It does not hurt. Interesting. Look at all the cities that instacart is in, boston, new york, d. C. , portland, los angeles. Im a very smalltime investor, but in the history of knowing the founders, and i have been with them for years, every time they have said something about their ambitions and i thought in my head no way they have proven me wrong everything all time. They think they know a secret about building a big independent company like uber. They are facing serious competition from amazon doing grocery delivery. When i was out yesterday with the instacart delivery, we saw a google delivery guy going by, and there is a lot of that stuff going on with all the other Companies Competing with instacart. Its tough. People want to deliver within the 48 hour window. 48 hours, it is really how to get something soon. The instant cart model starting with groceries is how to get something to you in an hour in more cities. If you look at the footprint of google shopping express now, amazon express now, its not the same as instacart and that is because the model is different. I was also impressed with instacarts quality of produce touching the bottom of the pear to see if it is ripe yet. Those are the things that make a difference. They have people who are trained. Thank you very much. We appreciate it. Bloomberg west will be back right after this. This is bloomberg west. Im cory johnson. French antiterror forces are raiding a site northwest of northeast of paris hunting for the gunmen who opened fire at a french satirical magazine killing 12. Various reports from french media says the suspects have been identified, two brothers in their early 30s, another in 18yearold. Leaders from around the world condemn the violence, including david cameron. Here are some of Angela Merkels comments. It was a very moving moment when we where able to address this, both of us, the french president Francois Hollande. We assured him that we would do everything to help them in this very desperate hour. We stand by the french people in all of those who feel committed to freedom of the press. We stand up for freedom of the press in such a resolute way. These are the basic freedoms that we hold dear in all of our countries. Vigils were held in paris and other cities, People Holding signs saying that they stand in solidarity with journalists. Closer to home, i sat down with the former mayor of San Francisco, willie brown. San francisco is the sister city of paris. There are deep ties between the two. I started off by asking willie brown what his reactions were to the terrorist attack . It is as if it happened to San Francisco. We are a sister city. 2009, the mayor of paris celebrated my 75th birthday with a blacktie party at city hall in paris. There is an interlocking relationship. Some of our educational systems, many of our schools. One of the languages spoken at our schools, one of the best schools, a frenchamerican school here in San Francisco. When that sister city is hit, it hurts us as well. I realize you have not been mayor for a while, but the sense San Francisco police reaction. What will a city due to this kind of thing in paris . I was reading today about what new york did after the london bombings. That was quite a while ago almost nine years ago, yet more new york city sent detectives immediately, within an hour, to learn about what happened there. What will San Francisco do . San francisco, of course, has been responsive to emergencies as a result of the earthquake. We have a set of protocols. We have a series of things we do. We have a facility, the 911 center in which all of the respective people who have any responsibility for running the city gather. Each of them know their defined roles. They know their departments. We have Communication Systems that interlock with the general Communication Systems for broadcast purposes. We pay close attention to the school district. Then of course with the coast guard and the water access that people would have, we are required to do all of that. All of those things go into motion immediately and it becomes almost seamless. So this city will actually decide, hey, we should be a little more on alert because of this attack in paris and who knows what is next. No question, im sure the chief immediately activated his entire intelligence unit, those officers, to make sure this city is under protection. And im sure he interacted with Homeland Security for america for that purpose. Other interesting changes going on here in San Francisco in relation to what is going on with technology and the boom the city has seen, like we have not seen since 1999. When you look at the employment numbers and their arm or workers are more workers in business in San Francisco then there have been since 1999, is that worrisome . Is that a great thing, having gone through the bust of the past . What have we learned from that . It is what every marion mayor in america would love to have. That is a problem that you want. You want unemployment under 5 . You want helpwanted signs all over town. Coupled with that is the need to make sure that affordability is not totally and completely ignored. You need to make sure that the gap between those who are earning and those who need it are in fact coming closer together. So the city and county of San Francisco, when they are saying jobs, jobs, jobs in his first term, he is now talking affordability in his second term. Believe me, that is a far more pleasant response than to worry about trying to create jobs. What lessons you took the city through the dotcom boom and bust. What did you know when you left the city 10 years ago tomorrow. What did you learn . There was no question the day that i left it was clear the concept of all this newness and all this new economy were almost where almost no products were produced was simply the foundation of what we are now benefiting from. We have all kinds of things going on. Throughout the world, there is a working relationship and there is a product being produced. That did not happen in the first boom. Only the creativity and the brainpower was there. In addition, in the first boom people did not move from Silicon Valley and relocate to San Francisco. That is a thing that is very interesting to me, this is very much in urban phenomenon, not a suburban campus phenomenon. Correct, and therefore the people want to live in San Francisco, they want to work in San Francisco, they want to spend their money in San Francisco. Suddenly, you are not in the boom or bust cycle as we were in the old days. Yet we still have a Football Team setting up in the suburbs of santa clara. And i think that Football Team is now having second thoughts. After all, you will notice their fortunes were not nearly as positive as they were when they were playing at candlestick. Thats right. [laughter] finally, does this feel different to you then 1999 . Dramatically different. It feels different because those who are the ultimate beneficiaries are actually the ones you are investing. They are buying, they are spending, they are being part. They had their kids in the schools. They are doing the kinds of things that you need to do with the give back and tipping points and other organizations of that nature. It is dramatically different. Former San Francisco mayor willie brown on the 10th anniversary of your victorious leaving from city hall, thank you very much. We appreciate it. Im cory johnson. This is bloomberg west. The manhunt is underway in france for the gunmen who opened fire at a french newsmagazine. Killing 12 people in the deadliest attack in france since world war ii. How can Technology Help us . Joining us is a professor whose work includes biorecognition. He helped identify one of the suspects from Law Enforcement video. This job looks harder these guys were wearing masks, covering a lot of the parts that would make them easier to identify. Thats right, ive been watching the coverage the past hour and i dont see much clue in terms of face recognition or even Voice Recognition because they hardly spoke, only a few sentences, and the voice would be muffled because of facial covering. I think biometric recognition in this case is very difficult to use. And then there is the requirement of recognition is the suspects must be in government databases, for example drivers licenses passports. Unless they are in a database, it is very difficult to do the recognition. Where does this start in terms of pattern recognition . Kind of patterns do they look for . There is an amazing story that says they went into the wrong door, as some workers where the best asked some workers where the magazine was, killed one of the workers, then moved on to perform their horrible task. Are those the kinds of things that fall into this pattern of recognition about who these guys are, with a new, and where the information came from . I think what would be most useful in this case are the network traffic, whether internet traffic or cell phone traffic, to find out who is communicating with whom. There also might be forensic evidence. For example, if they left a piece of clothing in their car or even the bullet casings which are left at the crime scene. Perhaps those casings could be linked with previous crimes. Think the most promising information is either from the internet traffic, mobile phone communication, and possibly human intelligence. I think the video footage just does not contain any information here. And what we know that human intelligence is often the most powerful tool, but this is bloomberg west, so im thinking about technology. I wonder what different technologies are available now than in 2005 with the london bombings or madrid before that. It depends on what is available. If for example there have been advances in facial recognition the past 10 years. But if the subject is not cooperative, as in this case because the subject is wearing a hood on the face, then it is very difficult to use that information. If the biometric information is camouflaged, it cannot be used. Then one has to go back to other forms of records. Forensic evidence, there have been great strides, whether dna analysis or bullet casings in this case. Again, in order to do a dna match, that suspects dna must be in some forensic database. That database is only growing, it is not extremely large at this point, so one has to rely on the human intelligence of the network traffic. The network traffic, what is referred to as social media information, there have been great advances made in Data Analytics where the data can be analyzed linking specific events to determine what was made leading up to this incident. That is interesting. Give me an analogy where we have seen big data take those massive things like web searches or all the cell phone calls of a certain area to give us information about something. For example, if there had been some purchases made of the rifles used in this case, if there were some people who were recruited to conduct this operation, if there was money transfer, if there was a signal that was sent between the known terrorist organization. These are the kinds of information which potentially could be linked to this. Its not an easy job, but at least the Computing Power as well as well as the data analytic techniques are now available which willing to these which will link these seemingly disparate events to form a plot linking to this event. So one has to start with known terrorist cells, look at the communication factors between patterns between them, and look for some specific words. It is a difficult problem, but given the huge amount of Computing Power and the Network Analysis techniques, i think it is something we have to rely on. Interesting stuff, from the east lansing, michigan professor, thank you. Coming up, we will head to c. E. S. To look at new Security Solutions, next. Im cory johnson, and this is bloomberg west. With almost every device going online from refrigerators to smart phones, Consumer Privacy is a major concern. For more, brad stone spoke with a chairman of the fcc at the chairwoman of the fcc at the Consumer Product show. Its not so much staying out of the penalty box at the fcc. The real question is how can the internet of things not sacrifice Consumer Privacy and consumer security. I think Companies Need to do the following three things. First and foremost, they need to be thinking about security by design. What i mean by that is companies at the very outset, when they are designing a product, they need to think hard about how to embed security. Secondly, they need to think about longstanding privacy principles about data limitation. Minimization. It means Companies Need to be thinking hard about whether they need to be collecting as much data. Even if there is a theoretical business use in the future for keeping it. Thats right, you need to think about if you really need it. If you collect and store a lot of data, it increases the risk of intrusion down the line. Thirdly, giving consumers greater control over their personal information is key. I think those three steps are both the potential for making essential for making i. O. T. A successful business model. In the nearly two years you have been chairwoman, you have spent a lot of time with technology, with snapchat, apple, amazon with inapp purchases, at t with thirdparty billing. Why the focus on Tech Companies . As a group, do you think they are too aggressive when it comes to matters of Consumer Privacy and protection . I dont think its so much that as we need to be where consumers are, and technology is planning an increasing role in consumers lives. In light of that fact, we are just monitoring the marketplace and taking action where it is necessary. We also see a lot of new companies entering the Technology Space and its important to make sure that those Companies Understand basic Consumer Protections that exist in the brick and mortar world also exist in the technology right now. In october you brought a very instant case against at t for interesting case against at t for throttling data, limiting the data of customers even when they had unlimited data plans. How prevalent is that practice among isps and why does that constitute an unfair and deceptive trade practice . I cannot really speak to the prevalence across the industry. Prevalent this is across the industry. What we found problematic about what at t was doing is they promised consumers are going to be getting unlimited data and they broke that promise. Certain consumers simply were not getting unlimited data. They were limiting data if it went beyond certain thresholds. We are protecting consumers and companies who need to fulfill promises. And they settle that, that was a mea culpa . Actually, the case is being litigated right now. Interesting. In november, president obama came out in strong support of Net Neutrality and said that Internet Access needed to be regulated as a utility under title ii, which would mandate that the fcc would have a larger role regulating Internet Access. Im wondering, what does that do to the ftcs jurisdiction . Does it limit your ability to have Consumer Protection on the internet . Let me first say that i agree with the president and i also agree with the chairman that we need an open internet. How we go about achieving that is something the fcc is looking at very closely right now and we will be hearing things. We do have an exception when it comes to our jurisdiction, we do not have authority over common carriers. That affect our jurisdiction, i think will be up to look at those things. Do you worry about that . Can you bring cases against at t for throttling if Internet Access providers are reclassified as a common carrier . It will affect our jurisdiction, but at the end of the day, the issue of an open internet is really complicated. It deals with economic technical, legal kinds of questions. Im looking forward to seeing how the fcc does that. Let me just press, so his title ii is problematic because it limits the fccs authority . I would like to see the common carrier exception eliminated. I think it is an outdated exception. We would like to see that happen and perhaps the congress will Pay Attention to that an address it. Chairwoman, thank you very much. Thank you. That was fcc chairwoman edith ramirez. At the Consumer Electronics show. The bwest byte, one number that means a whole lot. Joining us now is brad stone. Brad, hi, how are you . How you holding up . Hi, cory. Im well. I was a little conflicted today about todays bwest byte. 150,000, the number of attendees at c. E. S. Could go with 20,000, the number of new products. What do you have . Im going with 4, the number of hours of sleep i got last night. I feel your pain. I have been at that show hustling, hustling. All they want to know in new york is what youre doing, why havent you done more. You have been giving us great stuff, separating the signal from the noise. Great stuff. Lots of cool stuff. For me, the coolest things are the automated cars. How they drove from Silicon Valley all the way here to las vegas and an automated car. Really an advance. Brad stone, thank you very much. We will have more on bloomberg west from the Consumer Electronics show, and also headlines. They are online, your tablet everywhere