About synergies and the road ahead. What slowing economy . Chinese Online Retailer alibaba defies the slowdown of missed a amidst a trade war with sales surpassing expectations. First to our top story, it was a big week for tech ipos with fleet work and cloudflare filing to go public. The Web Security Company cloudflare has been in the news lately, given its relationship with controversial message board, 8chan. Three alleged gunman posted manifestoes on 8chan before three separate Mass Shootings in the united states. Cloudflare stop providing services after the latest shooting in el paso, left two dozen dead, largely taking the platform offline. So, is now the time to go public for cloudflare . I discussed it with Liliana Baker and will curtain. Like many other tech ideas, ipos especially in software, it is not profitable. It has a pretty good growth rate though. Its really trying to look at its competitor, fastly. Fastly went public earlier this year and is doing ok. There have been some sources who were asking me why cloudflare took this long, though, to get to this point and prepare their filing. They had been preparing since the fall of last year for a public offering. Emily right, cloudflare is a company, a name weve heard often in conversations about companies that will go public soon. It did not happen until this filing. Tell us exactly what cloudflare does. In the case of a company like 8chan, they basically protected 8chan from being taking down in denial of service attacks. Will right, so one of cloudflares most popular and wellknown products is ddos prevention service. It protects a website from a denial of service attack, anyone looking to attack the website and take it offline. They offer the service to tons of websites on the internet. They think of themselves as a utility. When you have the service it is the most effective or one of the most effective ways to protect your website from attacks like this. Emily right, and this is where 8chan comes up because cloudflare did not cut off 8chan. The site was still operational until just days ago after that shooting in el paso, texas. Liana, talk a little bit about what cloudflare says about 8chan and how investors might take that. Liana its listed as a risk in the filing. This has gotten a lot of attention because its buzzy, its relevant in the headlines, but i think that cloudflare was really aiming in its filing today to show the world how its financials are doing and what its prospects are. So i think it did a good job of putting it out there that this is a Solid Company that serves the backbone of the internet. Theres been pentup demand among investors for these sorts of companies to hit the market. A few weeks ago, medalia went public. Crowd strike has a good valuation a couple months after its ipo. So, i would say cloudflare today really is just trying to associate itself with some Successful Software ipos from earlier this year. Emily that said, cloudflare only made news when they made bad news under criticism that it helped keep some of these websites afloat. If you go back to 2017, and what happened in charlottesville at the time, cloudflare was under fire for helping support a neonazi website, the daily stormer. And it was only after much criticism that they finally took that website down by cutting off service to it. I spoke to the ceo, matthew prince and talked to him about some of their general policy of trying to remain neutral when it comes to content online and the websites that they service. Take a listen to what he said to me then. Matthew we turn to the experts in terrorism and illegal content which is Law Enforcement legislators, regulators. , we say here is this content and what would you like us to do . That feels like due process, that there are actually politically enshrined organizations that can make these decisions, as opposed to these decisions being made on the political whims of me or Mike Zuckerberg or jeff bezos. Emily now, when it came to 8chan more recently, it was several hours after that shooting in el paso that cloudshare said alright, were cutting them off as well. In a statement at the time, prince said theyve proven themselves to be lawless and a that lawlessness has caused multiple tragic deaths. Even if 8chan hadnt violated the letter of the law and refused to moderate their hateful community, they have created an environment that revels in violating its spirit. Will, expand on the context. Very complicated issues. Were seeing companies, facebook and google grapple with what to leave up and take down on their platform. For cloudflare, its a slightly different story. Will so, cloudflare is in a really difficult position here. They dont want to make content decisions. Like i said earlier, cloudflare thinks of itself as a utility. The product is so good and it is hard to find other comparable products. So, when you do not have cloudflares ddos protection, it might be difficult to stay online. What that means is cloudflare basically can decide who gets to be on the internet. They dont want to make those decisions. And as youve seen, theyve only made that decision twice in removing daily stormer and 8chan. Its a really difficult position, and when you do things like remove 8chan and remove the daily stormer, then you get material to say why not remove this website or whatever other website that has vile content on it . So, i dont think this is a business cloudflare wants to be in. They dont want to be deciding whats on the internet and whats not. Emily wework also officially filed for its ipo this week, expected to raise about 3. 5 billion. That would make it this years secondlargest ipo behind uber. Wework revealed a loss of 69 a loss of 690 million in the first month and 3 billion lost in the last three years, along with some unique business dealings by the ceo. Ellen hewitt had all the details. Ellen anyone who has been following wework closely knows they have been giving out select Financial Information quarterly for the last year or so. 2018, they lost close to 2 billion while making revenue of around 120 billion. 1. 8 billion. There were some surprises we got more details about some of the loans and complicated financial structures that go on between adam newman and the company. We have gotten some knowledge about this before. He was famously been a landlord but we also got information about loans the company has made the Succession Plan that would , happen if he could no longer able to serve as ceo. Emily our colleague, shira ovide, called the Office Leasing company on steroids with a complicated corporate structure. Theyre offering three classes of stock. One with 20 times voting power as another. Which takes it even a step further than what Mark Zuckerberg and the founders of google have done. Ellen right, there are actually three classes and two of them have 20 votes per share. Class a has one vote per share. As you would expect, thats a great consolidation of power. Its largely in the hands of adam newman. He has a lot of voting control over the company. That is kind of by design. People who support the structure think that adam has the right vision, the boldness, and the leadership to take wework even farther than it has been. For some of the people, they will look at that and raise their eyebrows thinking that might be too much. Emily now, the other thing thats interesting is that they laid out exactly how many of the buildings are fairly new. 30 of their locations are mature. 70 are two years or younger. The vast majority of their space is incredibly new. Ellen theyve changed the definition of that metric of a mature location. It used to be 18 months, they have expanded to 24 months. Even with that, its only 30 of their Office Location have been open for more than two years. They look at that as pointing to highgrowth. Exactly. Exactly. Like, look how fast we are growing. But its also interesting because a lot of the most stable Unit Economics they like to highlight are focused only on mature locations. They say these are where we no longer have to rely on marketing to fill the buildings. But when you start to realize thats only 30 of their portfolio, it starts to raise some questions about how sustainable their growth is and how easy it would be for them to get to profitability if they stop growing. Emily and they say they may never be profitable, which is similar to what we heard with uber and lyft. How are investors feeling . Are they excited . Ellen we see a lot of activity on twitter on both sides. Some people think the growth is exciting and others cannot wait for it to go public so they can short it. It will be a divisive stock. Well see the price will be decided soon by the public markets. I think a lot of people are looking to see if it will meet that 47 billion private valuation. Emily so how quickly do we expect them to get to market . When does the roadshow launch and all that . Ellen sometime in the next few weeks. We expect and have reported that we expect a september ipo. Thats just around the corner. Emily that was bloomberg techs ellen hewitt. Coming up, thumbs up. Redstone cements her status as the most powerful woman in u. S. Media with cbs merging with viacom. And if you like bloomberg news, check us out on the radio. This is bloomberg. Emily cbs has merged with viacom. The deal unites the mostwatched u. S. Broadcast network with the parent of Paramount Pictures and cable channels like mtv and nickelodeon. It followed a marathon negotiating session and the two sides hashed out a price. Hi got details with lucas shaw. Lucas they finally realized that after two or three years are going back and forth that whatever misgivings they might have had, they both just needed to get bigger so they can compete in this streaming war. Over the past two years, we have seen at t by time warner and time warner sell out to at t. Weve seen fox and the murdochs sell a lot of their assets to disney. And now most of the companies that are playing in Media Entertainment are Companies Worth 100 million, 200 million. If you count Companies Like apple and amazon, 800 billion, 900 billion. Cbs and viacom, even combined, theyre worth only about 30 billion. But by coming together, they have a deep library that will get much stronger. Emily so, how does this position, this now combined entity, against all of the other newly merged now larger Media Companies . Lucas you know, its still small in comparison. Most analysts and investors believe there are probably more deals to be made. I spoke to the ceo of the combined company and he acknowledged that more m a is likely. Theyve been linked to Companies Like lionsgate, discovery. Its possible they might merge with one of them. Its also possible that the redstone family, who will own control the combined company, say its now time to cash out. They might take a couple assets weve seen, but it might be stronger and might be able to entice some Larger Company to scoop it up. Emily that was bloombergs lucas shaw. After details on the newly merged companies and strategies, we heard from viacoms ceo who sat down with bonnie quinn in vonnie quinn new york. Bob we were thrilled that we announced the combination of viacom and cbs, creating a leading platform. When you look at the assets, it unites the powerhouse cbs, a station operator, a syndicator, the studio with Paramount Pictures, one of the most storied studios in hollywood. Global brands in nickelodeon, mtv, comedy central, and bet. They have shaped culture for 40 years. And, of course, showtime. Pushedum service that is the boundaries of storytelling. Weve created an incredible asset base. This was a deal that was negotiated by two special committees and went through a diligent and thoughtful process. And again, the critical thing is we got the deal done because it positions us to do great things. Vonnie no question it was a phenomenal deal for both sides and there was a willingness to get it done, yet some shareholders are nonplussed that viacom is not valued more. Would cbs have given in eventually . Bob again, this deal was conducted by two independent committees of independent directors. When you need to focus on is the value created potential. These are two companies valued at particularly low multiples. A lot of that was due to the uncertainty hanging over them. Also, a lack of clarity on the path forward. Starting yesterday, we started talking about a threepart Growth Strategy really building a significant business through a combination of cbs subscriptions, where they have millions of subscribers between cbs all access and ott. Plus, viacoms ad supported structure with pluto tv being the leading Free Tv Streaming Service in the u. S. Up 50 since we bought it. Putting those together, you have an ecosystem. We love that and will be a very significant partner with ads, distributors, and a huge content supplier. Very exciting Growth Strategy going forward. As that tracks out, people will see the material value here. Youve also identified 500 million in cost savings. Some of those will be job eliminations. Can you give us any more detail on how many and where . Bob sure, when you put two companies together, people talk about synergies. Those numbers you reference is a cost number. It includes organizational costs and sourcing benefits. Some real estate benefits. Beyond that, we havent gotten into it. I think the more important thing to focus on is the power of this combination is going to create incredible value for all of our stakeholders, including the incredible employees of viacomcbs. They will shape the future of media. I think thats what people need to focus on. Emily viacoms Ceo Bob Bakish there. Coming up, softbanks massive fund makes its first ever Energy Storage bet. We find out what energy vault is with the ceo. This is bloomberg. Emily softbanks massive vision fund made its first ever Energy Storage that, investing in energy vault. This company stacks concrete blocks in a tower that can store and release energy. It is presenting the system as a bigger and more affordable solution to lithium batteries, claiming it can supply grid 24 hours the a day. To discuss what this means for the Energy Storage market, i sat down with the ceo. Weve designed a very new, innovative system tower. It includes a six arm crane and 35,000 metric ton bricks that are all orchestrated and raised and lowered with a proprietary software stack, so thats the whole system integration. What we do is we take excess energy from solar or wind when its produced and not needed. That energy is used to raise the blocks. And when the energy is needed by the grid, we lower those blocks and discharge the energy. Emily and how widely deployed is this . It says youre on four continents. Robert correct. Weve had a working model for the last year in switzerland. In addition, were building our first commercial scale unit in the Fourth Quarter in the north of italy. As we announced, many, many customer engagements on many continents. Were excited. Emily what do you think the draw is for softbank . Robert they share our vision for renewables and understand how important Energy Storage is to make renewables real and make renewables solve the problem of our reliance on fossil fuel. They own an energy company, so how important Energy Storage is they own an Energy Generation company, so they understood this beyond just being an investor. They share our passion to be to solve this problem. Emily so this system, as we saw there, relies on this giant Automated System that has to work reliably outside in the elements year after year after year. It seems like a lot of moving parts. Do you have concerns, or is there a risk that some parts might not function properly given all that exposure and throw the whole things off . Robert actually, thats one of the beauties of innovation. The technology were leveraging fundamentally is proven physics. Were leveraging unique material science working with one of the Largest Materials Companies in the world, so were actually not using normal concrete. Were using a material composite for 95 of these bricks and raising and lowering them, so the fundamental core physics is known. Where innovation comes in is with the proprietary Machine Vision software that fully automates the tower, as well as a lot of other innovation we thought of from a sustainability perspective. This last point is important. So, in not only the materials, we can use the soil right from the site we excavate locally to make these bricks, so we dont have bring in trucks, materials. Were not spewing omissions with emissions with trucks coming in or other transportation elements coming in, and from a sustainable perspective, we use some of the suppliers in a Global SupplyChain Ecosystem that exists today, so we can do it now. Emily now, weve seen lithium ion batteries start to be attached to the energy grid, but often they can only supply energy for hours at a time. How long can your system . Robert sure, thats another one of the innovations, longduration. So, while we can support four hours of storage, we can also do 812 hours. Why is that important . We cannot only meet the time requirements of utilities but think about manufacturing companies. Industries and industrial processes that rely on the power 24 hours a day. Desalination plants are a great example. They need power to make Drinking Water 24 hours a day and we can now provide them for the first time that power. Emily now, weve seen a lot of pushback from local communities against giant solar power plants, large wind