they are ignoring problems in the big economy. >> the big thing we are trying to figure out is what a global economy looks like with insufficient demand and very accommodative unconventional policies. what is the endgame? we really don't know. >> meanwhile, oil stocks were up today. the price of oil slid nearly 3% after yesterday's big rebound. ibm signs more cloud computing deals as it tries to boost revenue. the latest deals are with wpp and thomson reuters. they could add $4 billion to ibm's top line. the revenue comes at a crucial time for big blue, which recently ditched its earnings forecast. a federal judge in minnesota refused to toss out a lawsuit filed by banks against target over last year's huge seven security breach. they sued target for negligence, saying they failed to protect systems, and the banks had to reimburse people for fraudulent charges. uber has partnered with america movil. -- america mobil, the wireless company owned by carlos slim. the right sharing app will be on all america movil phones in mexico. -- ride-sharing app will be on all america mobile phones in mexico. uber is looking to raise more money, a move that could value the company as high as $40 billion. back in the day, apple's ipod was king. remember this? ♪ >> ipod, 1000 songs in your pocket. >> those days are back again, at least in federal court. apple is appearing in a decades-old class-action suit over the ipod. the issue, whether apple violated antitrust laws by forcing customers to use the ipod to play music downloaded only from itunes and nothing else, blocking access to music from other services. apple could be on the hook for as much as $1 billion in damages. late apple cofounder steve jobs will play a key role in the trial. e-mails from jobs and a video deposition from just months before he died are expected to be key pieces of evidence. joining us now is robin feldman, professor of law at uc hastings in san francisco. also, a distinguished professor at rutgers law school. what is that state in this case? >> in an antitrust, the damages can be high. but the questions are simple. antitrust, big is not bad, is what you do that matters. the question will be, was apple competing on merit or trying to throw its weight around? >> as it relates to that, there is a lot of discussion about apple saying that they are trying to control their own world with music. i remember when they announced you could not download other kinds of music onto the device. what would make that illegal? >> apple is trying to show that they have a reason for doing what they did, that when they make it harder for users of the ipod to connect with itunes, that there is a reason. if it is a security reason, if they want the best quality of music. that will be crucial. if you have a good reason for doing what you are doing, that gives you a get out of jail free card. on the other hand, plaintiffs will claim there is no good reason at all. the only reason apple linked the ipod with itunes was to hurt rivals and increase price. >> can they make the argument that everyone else says, that -- everyone else stinks and that adding anything would make it confusing for users? >> if it is legitimate, they could say that the itunes store had the best quality music and that if there were competitors out there it would not be as good. it could crash the ipod. they could come up with stuff like that, but they would have to substantiate it. if it looks like there was no such good reason, they could be in more trouble. >> as i understand it, beauty is in the eye of the beholder. if they say it was beautiful the way they had it excluding other services, is that enough? >> you have a jury in front of you. who can tell a story that the jury believes? the question for the jury, was apple trying to do the things that consumers want? greater security, greater products. or where the updates just a way to try to strangle competitors in the cradle? the technology that kept older ipods from playing music from other services, were they doing something legitimate? >> looming large, steve jobs. there is no better storyteller in the history of technology. is the sympathy of a sick steve jobs before his death, is that going to shape the jury? what has the judge done to keep that from happening? >> it is a complex question. the judge has said that apple, the plaintiffs do not get to introduce some sort of inflammatory material that jobs may have said. as long as you don't open the door to talk about what a great visionary he was. one of the difficulties that you face in antitrust litigation if you are apple, steve jobs, no matter what a visionary he was, what a genius he was, said some things in terms of apple striving to be the best and to quash competitors, that through the lens of an antitrust filter do not necessarily look so great. when you say in a business world we will be the best, that's one thing. when you say we will quash our rivals and that is tossed in front of a jury in an antitrust trial, that is something else. >> you mentioned what might be a magic word in this trial -- visionary. the judge has said that if you go back to all the things that have been found to be anticompetitive -- the attempt to roll down wages. the case in new york with book publishers who conspired with apple to fix prices. the whole issue of describing steve jobs is a visionary could trigger some big changes in this trial. >> raising steve jobs from the dead is a risky strategy. the plaintiffs will try to show that he was an aggressive businessman determined to win at all costs. but that could backfire, particularly for a jury in silicon valley. steve jobs still holds icon status here. one does not have to use the term "visionary" to remind people of the type of sympathy he brings in this area. >> this trial is being held in oakland. technology is all around us in the bay area. is it reasonable that the jury would hold steve jobs in a unique regard? >> juries are human beings. they will remember the impressions they bring with them from what i heard today. steve jobs is a character that is larger-than-life. apple has also been in the news a lot. it has done things tremendously procompetitive, and things that are anti-competitive. itunes itself is one of the most exciting procompetitive moves that happened in recent times. it opened up a tremendous amount of competition in the music industry by allowing individuals to download songs individually and to buy them online. on the other hand, as you mentioned, apple got into trouble with the electronic books by trying to broker agreements among publishers. the question for the jury in this case would be, which side of the divide was the company on this time? >> cyber monday sales are up. but growth has been slowing -- perhaps because all the deals coming out early. we will look at the confusing numbers. you can watch us on your apple tv and amazon fire tv. ♪ >> i'm cory johnson, and this is "bloomberg west." preliminary cyber monday results are in. growth was slow, but sales were up. ibm estimated sales rose 8.5%. shopping on smartphones and tablets accounted for 41.2% of traffic yesterday. how is online shopping changing over the holidays? joining us -- scott, what does your data show? >> we showed that on cyber monday we were up 16.7%. the cyber five, the days between thanksgiving and cyber monday, overall we were up 20.6% for those five days. we saw things shift earlier, so it is important to look at the whole five-day period. >> the "cyber five" sounds like a superhero team. numbers out of amazon showed that saturday had tremendous year-over-year growth, sunday as well. ebay saw a big boost. amazon, not quite as much. what is going on? >> you have to look at the five-day period. on cyber monday ebay outperformed. they held back a lot of promotions for cyber monday. amazon went early. that's why they had a really great saturday. we saw a lot of things out of stock. a lot of top toys and electronic items became hard to find on real shelves and virtual shelves. ebay benefits when that happens. with the auction format, that's where people go when they are desperate to find the one specific item they are looking for. >> so there is a market for that hot tickle me elmo or whatever it is this year. unthinkable i don't know what it is this year. i was struck by the numbers that showed different results. ibm had their numbers. you had your numbers. they were dramatically different. ibm said 8.5%. you said something, 16.7% year-over-year growth on monday. talk to me about that discrepancy, which is not small. >> i want to speak to the ibm data. that is from clickstream data, looking at clicks and that kind of data. we have over 2700 customers, and we measure the transactions they go through a software. so we're not taking a survey or clickstream data. we are looking at our data. we also do same-store sales reports so that we are not limited by customers we gain or lose over a period of time. that's the best approach. what we do, we help retailers buy traffic with search and comparison shopping, and we look at what is happening at ebay and amazon. >> let's talk about how people shop. i found myself in an airport shuttle buying a shirt from a small retailer in texas while i was in minnesota. people are shopping on smartphones and tablets in bigger numbers this year. how has that changed? if people are not waiting until monday, does the whole notion of cyber monday go out the window if people have phones and tablets? >> throughout the year when we look at traffic trends, about 40% of the folks use mobile. on thanksgiving it went up to 50%, the highest watermark we have seen in the u.s. in europe they are well ahead of us there, and certain retailers in the u.s. are ahead of 50%. the numbers are lower because the conversion rate on mobile is lower than on desktop. on thanksgiving, 35% of sales were for mobile. to your point, it is becoming interesting, what we see is a movement for the same thing that happened to black friday, where everyone is trying to move it to thanksgiving or even the week before thanksgiving. everyone is moving cyber monday up. walmart, target, amazon all ran cyber week deals. you ask yourself, does the whole trend of cyber monday even matter anymore? it used to be that we would use broadband at work. it also used to be that the peak hours were 12:00 to 1:00 eastern, then after 7:00 p.m. now we see it later in the evening. 10:00 p.m. was the peak. the 6:00 to 10:00 p.m. eastern window was where we saw cyber monday sales this year. it is not for work anymore. largely the promotions are driving it. interesting almost like after work is when people are doing cyber monday shopping. >> the death of cyber monday, makes me so sad. thank you very much. the fallout from the massive hacking at sony pictures might be just getting started. the fbi is warning u.s. businesses to be on the lookout for disruptive cyberattacks. that story, next on "bloomberg west." ♪ >> i'm cory johnson, and this is "bloomberg west." the fbi is warning businesses that hackers have already used malicious software for an attack in the united states. an unreleased movie starring brad pitt leaked onto the internet after an attack on sony. experts already connected the dots. how many other businesses should be concerned about this warning from the bureau? the vice president of research -- chris, what makes us think these attacks go beyond sony pictures? >> well, i think that the investigations suggest there is malware, common types of malware that have been seen elsewhere. i would suspect they have intelligence that whoever is pervading the attacks is targeting other companies as well. it is, and to use malware to extract information that might be useful in further attacks. >> so these might be -- these are attacks were they will see what they can find in the maybe later exploit those? >> that is the typical way it goes. you are not that far off when you say phishing attack. the most common way to get malware on systems is to use phishing, sending e-mails to fool people into going to sites hosting malware. sometimes they will target high-level executives in the company to get them to install malware. once that's installed a number of different things can be done. destructive malware, which essentially destroys all the information on the hard drive, makes the machine inoperable, and simply deletes everything it finds. there's spyware that tries to observe what the user is doing, capture keystrokes or files. botnet, all different kinds of malware can be used to extract information. >> there's speculation that the james franco and seth rogen movie that somewhat ridiculously has them as leaders in a plot to assassinate the leader of north korea, it's said they got north korean hackers to attack them. the fbi is suggesting this might not be the case, and is a broader phishing expedition. should the world be afraid of seth rog is really the question hereen. -- afraid of seth rogen is really the question herein. [laughter] >> it makes a good story that there is a movie coming out, so north korea is doing it. not a lot of specific information is tied to that. generally speaking, all companies are being targeted. anyone with viable information, sensitive information, cardholder information, all the breaches we have seen, make most large companies very lucrative targets for attackers. so it's not unreasonable to think it would go beyond sony. >> chris eng, thank you very much. coming up, sting speaks out, the latest to weigh in against spotify. the new threat to the music industry, next. watch this streaming on your tablet, phone, bloomberg.com, or your apple tv or amazon fire tv. ♪ >> time for bloomberg television "on the markets." get you caught up on where stocks traded today. a little bit of a rally pushing the dow jones industrial average to an all-time high, 102 points up. johnson. >> you are watching "bloomberg west." i am cory johnson. it came of age at a time when there was no such thing as itunes and spotify and became one of the world's best selling artists, sting. sting still has millions of potential revenue at stake in streaming. betty liu set down with the 16 time grammy winner and asked him where he stands on the changing music business model. >> the model is changing obviously and i don't think the model we have at the moment is necessarily the one that will be there in 5-10 years. we need something with a little bit more equity for musicians. musicians need to be paid for their work. it's fine for me. >> you have made your money. >> i am have made my money and i am well-off. those beginning their career, the idea of making a living from this business is tough and increasingly so. whatever model is created needs to be equitable. the streaming model is a good one but they also need to be paid. >> you are on streaming services. in some ways you support these models? >> i think they are evolving. i was interested in the taylor swift stand. i thought it was a brave stand and she also brought it into public debate. it was good and people me to talk about this. what is good for music? music is important to our society. it must not die out. it is a vibrant part of society. >> so you agreed with her move. >> i thought it was good to get the debate out. whether she goes back to spotify or not is up to her. to raise the debate is a good move. >> when that happened, that created some seismic changes. >> some people have no idea there is any issue. but musicians need to be paid. >> i would hear from people who said why should artists feel they have any rights to be making tons of money like they have in the past? >> not tons and tons of money, it's making a living. in this industry, you can make a killing but it's hard to make a living. it needs to be more equitable. >> do you think mark artists should push back like taylor swift? >> i think the streaming companies have gotten the idea and they are working as best they can, i suppose, to make it better. it is evolving. every day is different. i am intrigued by where it is going. i'm glad i am starting out in the music industry now. that would be a tough one. >> would you be able to make as much money as you have if you started out today? >> no, i have no guilt about making extravagant amounts of money. i did that at the time. but i worked hard for it. i'm still working hard. i enjoyed it. >> you are still taking risks. >> >> yes. >> what do you think of the new artists today? you have made comments about justin bieber. >> i feel sad sometimes when people leave school and they have a hit on "x factor" and then they get involved in this crazy world without any kind of thing to compare it to. i don't know how you stay sane in that. the pressures are enormous. unless you have had some grounding in real life, it must be very difficult to survive. >> should the music industry be more responsible towards that? is there anything that can be done? >> you cannot entirely blame the music industry. the media is responsible and society generally. you put people in these positions that are difficult to sustain. when you are a young person and you suddenly become famous and successful, you think you're entitled to that forever. entitlement doesn't help. >> you don't let that get to your head? >> no, because i had a real-life before and i may not be possible in this era. i'm glad of my time. >> that was a former schoolteacher, sting. speaking with betty liu. for more on the changing music model, paul sweeney joins me from new york. he has done work in the music industry. with streaming industry, there has been a big change with different artists fighting against and suddenly they are fighting against spotify and their increasingly dominant model. what do you think? >> the music business once again is changing and it's really going from a business where consumers actually own content to where they just rent it. no longer are people buying albums. we have known that for over a decade. if you look at the apple results, they talk about how their itunes sales were down last quarter. people are actually renting music and streaming music and i think the artists are saying this is a bigger part of the business and we need to make sure we get paid adequately for our content on these services. as sting phrased it, a more equitable pricing policy is what i think a lot of these artists like taylor swift are pushing for. >> it's interesting that there has always been a battle within the music industry of the songwriters versus the performers and who will get the most money. you can make a killing but you cannot make a living said sting. has that balance of power change in the world of streaming? >> it has. an interesting company's live nation, the largest concert promoter in the u.s. one of the stories they tell is that for performers, it's very difficult to make a living producing content where the performers really make their money is on live events. that's why the concert business remains a vibrant business in the music sector. it's really a challenge as consumers change the way they consume music from owning lots and lots of music and building libraries of music to simply renting it on streaming services and it makes it difficult for the artist throughout the food chain to get paid. >> it was great hearing that interview with sting. garth brooks is another supersmart guy has been talking about this lately. he had an interesting tweet -- he said "songwriters are hurting and i applaud ms. swift and everyone for standing up for the songwriters." pandora continues to say they will find some way to lower their cost by getting ascap and lower their cost of providing music to pandora. >> what you've got is a very classic standoff between the content creators, the talent, the artists, and the big media companies come in this case the streaming companies. one of the biggest costs in streaming is the royalty payments you pay for the content for the music. we have sting calling for higher rates and yet the streaming services are really pushing to lower the rates or to keep it cap on the rates they are paying. >> paul sweeney, thank you very much. startups may be tempted on not going it alone but a new business model for venture capitalist might offer a longer runway for sustainability for startups. we will talk about that next on "bloomberg west." you can watch a streaming on your tablet, phone, and on amazon fire tv. ♪ >> i am cory johnson and this is "bloomberg west." how can founders to the rent while growing startups? there is a solution to this big problem. there is a firm that is a new model combining pure mentoring with staying afloat. the cofounder joins me right now. great to see you. tell me about how this idea came about. >> i was having breakfast with john patella and he was telling me about his company he was building and some of the issues he was having building it. it struck me because i had for startups and i was feeling some of the pain he was having. being a professional and trying to grow a company quickly is stressful and the stress is equally big on the personal side. the thought was, is there a better way to help founders growing these very fast-moving companies and not only think about how to do that better but also solve some of the personal issues that put stress on them and distracting from building the business to its full potential? >> i think we are talking about founders who have founded many companies and of done this a few times but the financial stress on the families on an individual when you've got this business in his early days will lose a lot of money. >> the other thing is these companies are growing faster and using less money than before. as a result, they are staying private longer. what used to be four or five years, you are looking at the 10-12 years for these companies staying private. a very long time. >> the big payout than is further out for these founders. what kind of companies are you trying to identify? >> we wanted to focus on companies that have evidence proof of amazing product. if we were focused just on companies that had similar issues, we could be way more helpful. >> these are some examples -- dollars shave club. ebay. what do they have in common? >> we call it breakaway growth when a company has a minimum of $40 million in minimum growing at 40% per year and 40% gross profits. >> top line at 40% is probably not profitable. but they could make money someday. >> exactly, these are category leaders. >> $40 million in revenue it seems would have a lot of choices for another round of fund raising. >> they do. the problem we are solving is not with a company needs for many times these companies are profitable where the cash flow. the real issue is they've got people who have been working their tails off for five or seven years that have student loans they need to pay and they are trying to buy their first home in the bay area and have other issues built up over 5-7 years. we like to think about it -- >> it's an approach to buying the private shares while they are still private? >> that's kind of a broken model. it is not really align with the company. to build one of these really amazing companies is like running a 26 mile marathon. we are the water station at mile 21, giving a peptalk and learning and a little bit of a boost to help these founders push through. >> one thing they are fighting for his liquidation preferences, how does that change? buying company shares put you in the back of the line. >> it does not matter to us. we are focused on his breakaway growth companies. by definition, there is a lot of enterprise value that is built up in the business by the time we are intersecting. we are trying to do things that work naturally with investors and the company and the founding team. >> you don't demand those kind of liquid options? >> that's right. it's a great way to solve the problem. we sat in every third is and have been on the board and been on the founding team and understand the company issues and for you to do something unnatural and demand things of these companies that are clearly breaking away does not make sense. a great example is what we did for kabam. kevin said we are seven years into this and i think we should stay private for another couple of years. my team has been working hard, can you help me? they wanted more liquidity with the employees. so they can own their stock and ultimately build the business. >> there are a lot of interesting issues there. fascinating answer to a complicated problem. thank you very much. retailers are battling to get packages to your doorstep the fastest. how companies are turning to tech to win the shipping wars next. ♪ >> cyber monday is over for the shoppers, but the delivery rush is just beginning. with brands offering same-day delivery, it is a war to get the packages to your doorstep. how are e-commerce companies turning to technology? what do you guys do? >> we help businesses ship like amazon. so we help them easily integrate the carriers like fedex and ups and all the major carriers to their existing infrastructure so they can have a scalable shipping and logistics infrastructure. >> this is part of ebay that has the same services but of also incorporated warehouses for online retailers. how is what you do different? >> it's similar but we might be the next generation of that. it is easy to do. we have client libraries in major languages and can tell any companies and help them get integrated with their shipping integrators as quickly as possible. >> this is a software solution so how big is your business? >> we ship millions of packages each month and have hundreds of customers and those customers range in size from hundreds of thousands of packages per month down to hobbyists. it is customers want to have dynamic shipping integration. we set them up with whatever carriers they need from day one and they can build on top of that like tracking updates to customers and insurance and address verification. all the services you need from the carriers. >> let's talk about what is happening with cyber monday. we are hearing about cyber week, not cyber monday. is this cyber monday substantially different than the past couple of years? >> i heard it was up 7% to up to 30% over last year. online retailers are trying to push more into this week. they are trying to extend it past monday and the carriers are trying to push retailers to ship earlier. if you get your orders and early this week, you don't have to rush during christmas. it's a strategy from both of them trying to get the orders in earlier so they get more successful deliveries. >> i spent yesterday at an amazon fulfillment center. i watched them use robots. it was fascinating and they crammed 70% more stuff into this building. if you were a target or walmart and you looked at this, these guys will have more capacity at their warehouses, how can we compete? is amazon becoming the standard of the world? >> i think drones are cooler. robots are cool but -- >> this stuff is happening right now. now they're going to expand. >> that's a big part of the reason that walmart is still running their online operations at a loss. they had a record day on cyber monday but it's very expensive and amazon keeps setting the bar higher. the rest of the market is struggling to keep up. >> so it's really amazon that is driving this. >> it is but you cannot get everything on amazon. there is a huge portion of the market, 75% of the market, that will not sell on amazon and they do their own fulfillment. the battle is getting the other companies up to amazon standards. >> maybe you offer the opportunities for small and local businesses that have to compete in some way to at least be able to be in the fight. >> absolutely. >> fascinating stuff. we really appreciate your time. the bwest byte is one number that tells us a whole lot. i have no idea what it is. >> the number is 2015. that is the year that so-called internet pirate kim.com will bring his internet party to the u.s. he said today in a tweet -- >> does this involve a disco ball or is this political? >> it will stir things up and he says he will be hillary's worst nightmare in here is a guy who 2016. tried to do this in new zealand and did not get any seats in parliament and the september election. he has not been that effective so far. he also tweeted to this -- he said he will help with the public relations area he has hundreds of thousands of twitter followers, but the u.s. is trying to make him a flight risk. they want to keep them out of the country so i don't know how this will work. >> it sounds like kim dotdom has more to do. is this serious? is he going to try to do something here? >> he will certainly put his money behind it. he has donated more than $2 million of his own money in new zealand. he says this will be an american run operation. he does not plan to be a huge part of it except for the engine behind it. >> a fool and his money are easily separated perhaps no more so than in politics. thank you for that ridiculous kim dotcom story. we love them. you can get the latest headlines all the time. on your phone, your tablet, and on bloomberg radio. we will be back with more "bloomberg west" tomorrow. ♪ >> this is a paid advertisement from the new face of time life, star vista entertainment. ♪ >> it is the music that transformed america. ♪ smile on my face >> the beat of a generation. ♪ the same old song ♪ but there's a different beat since you've been gone ♪ >> the soul of a nation.

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