technological changes that have taken place, but we've also doubled our production of clean energy. >> oil futures up after the selloff. diane feinstein wants the faa to tighten restrictions on drone pilots. in a letter, she said recent reports of close calls between drones and commercial planes are alarming. they are proposing criminal penalties. more reason for disney shareholders to smile. they are boosting the annual dividend by 34%, $1.15 a share. disney stock hovering around an all-time high posting record revenue and profit in the last fiscal year thanks to hits like "frozen" and "guardians of the galaxy." and raising $500 million to start a second fund to invest in early growth tech companies. they were oversubscribed three times. the first fund included oculus vr salesforce. partners include gideon, the 49ers co-owner. sasha and a dela is leading his first shareholders meeting as microsoft ceo up in bellevue washington. a majority of shareholders have approved his pay package which could be worth more than $90 million for the fiscal year. an advisory firm recommended shareholders vote down that package, but the board was easily reelected. arguing for more diversity in technology, reverend jackson will be joining us in the studio. cory johnson, you've been talking about the pay package all morning. >> as it relates to other companies and other ceo's, the third highest pay package during this last calendar year. i think it's interesting that iss that represents the votes of so many mutual funds and pension funds, they opposed this pay package. they have had a good year, but they've had a crummy decade. for that reason they oppose this very high pay package for the incoming ceo. >> he's not coming in as the new kid on the block. >> if you look at someone like warren buffett, he is already rich, but he is right in line with the shareholders. satya nadella will be taking home guaranteed pay and bonuses every single year. it's a hard job, but as it relates to how the company is structured, they oppose the deal for those reasons. >> some ceo's will take one dollar a year and the rest of it in stock. >> he's not saying stick with me, i will lead you to the promised land. he's taken some money off of the table and is not ncomparable to other ceo's. the income inequality gap and those people that are driving the buses or the microsoft buses or cleaning their houses or cleaning their office buildings. listen to what president obama had to say about what it means for the economy just a little while ago. >> when you look at the history of this country, when it is good and consumers feel like they have money in their pocket, it ends up being good, not being bad for business. most of you would agree with that. and we have a lot of good corporate citizens. the overall trend lines even as productivity and profits go up, wages and incomes have shrunk as a share of overall gdp. >> nadella, it's not his fault that there is income inequality, but we will be talking about the history of ceo pay and we think about what this means for the country and a world where we see such great disparity. >> we will talk about this a little bit more. talking about apple, and it's day two of the anti-trust trial with steve jobs being a key witness. the video recording of testimony he recorded before his death may be played. jobs said apple, "had a black and white contract with record labels and took great pains to protect them." the head of itunes may testify as early as today. at issue is if apple violated antitrust law by forcing customers to force them to listen to itunes alone and blocking access to music from other services. joining us, the senior analyst just increased as apple target from 135 dollars to $150 share. it would have valuation of $880 billion if it reaches that. why are you so optimistic? >> it's coming from the blockbuster sales trends we're seeing in north america and china. we ran some checks and it looks like in china, we are seeing the same sort of trends. particularly at the high-end, we are looking at two to three week leadtimes. it's a great start for apple and we think it will be a block esther december. >> you have apple holdings? can you explain? >> i do not. >> i think this case is so interesting because it talks about the way that apple works. the accusation, at least, is that apple purposefully kept consumers from using music that they downloaded on other networks and other formats. was it closed for the sake of security and simplicity or was it that we want your money? >> it is almost a decade and if you put yourself back then, we were talking about napster that was burying the music industry. you could make the case that apple saved it. transformed the music industry, really, then went on to transform the apps industry and the pay industry. as far as was it heavy-handed or not, what i saw was them pushing forward. >> apple says we do things to make things simpler for our customers. a lot of them had accounts with real networks where they were buying music legally and acquiring music legally and apple was keeping that music off their devices. is there a difference between the words that apple says and the practices that we need customers off of our devices? >> the music industry was very concerned about digital rights management, so apple had an obligation to protect that content. whether or not it could've played nicer with real or not, i don't know. i do know consumers had other options. but none of them were very good. >> apple could be on the hook for $1 billion in damages. 10 years in the making? >> i like apple is pushing back against this. you don't want frivolous lawsuits coming up because they are aggressive about innovating and transforming industries. they need to resist this one. $1 billion is a drop in the bucket. this case in and of itself from a financial perspective does not look material to us. >> the highest price target on the street. thanks for joining us. we will be right back with more "bloomberg west" after this quick break. ♪ >> amazon ceo jeff bezos has a succession plan for the company's next stage of leadership. he would not say who exactly that person is. this news coming from the ignition conference in new york this week. bezos also talked about the "billions of dollars lost on his failures" and how the e-commerce giant doesn't consistently turn a profit. so what's in store for amazon's future? i want to start with you. who could replace jeff bezos? we know who's on the bench. who's at the top? >> there are a few names at the top, including jeff wilke. he is one of the highest-paid executive at amazon, runs the overall consumer business. other names including jeff blackburn. there are a few names kicking around, but what i want to point out is that bezos is 50. that is below the median age for ceo's in the s&p 500. i wasn't going too crazy over this little nugget of information. >> god forbid he gets hit by a bus, life is what life is. you want to know that this company is so focused on one individual's idea that it is the culture of jeff. you either love him or you don't work there. >> and at the conference, he tried to minimize that. how the culture is so ingrained in the institution that it would carry on without him there. even the chance of him getting hit by a bus, he talks about how much he hates to travel and how much he loves being at work. he is younger than the average ceo -- >> exactly. he's not staying in one location all day long. we were speaking about pay compensation. jeff bezos takes $81,000 a year? huge difference there. >> obviously, he is the founder and his pay structure is more in line with what you saw for steve ballmer and bill gates. they have such a big stake in the company that the incentive for them is driving the stock price. >> he's got a founder's pay package, but the other guys, the guy that runs amazon web services, his pay package is $160,000 a year. the amazon culture is a cheap culture. >> the amazon executives, their salaries are generally low. there are other executives and they do get equity and they do have a certain stake there. going back to the satya nadella situation, he did not have as big a stake as steve ballmer. but what they gave him was a big stake with a lot of incentive to really drive performance. he won't receive a majority of it unless they outperform the s&p 500. again, on an annual basis, it's something where the equity package is going to be heavily influenced by the amount of stock he's getting that will of course be driven by the value you can get driving the microsoft share price. >> i'm sure he will share a lot of it with people that need it. >> thank you both. after taking on uber, senator al franken questions lyft. ♪ >> welcome back to "bloomberg west." senator al franken has sent a letter to lyft asking them to clarify their policies. we spoke with cofounder and president john zimmer and asked how they plan to respond and what privacy changes might be in store. >> we further limited the number of employees that have access to personal information. a customer service representative may need to access the information if they lost their phone in the car or say, can we check this last trip? there are other individuals that don't need access to that information and we make sure to review who has access and put additional limitations in place. >> ever since this controversy grew not only over privacy but the retaliation that one of the executives had uttered for negative coverage, i heard that your usage has spiked. is that true? >> we have better and better weeks, and the rides are on the rise. year-over-year, they are up. obviously there is a lot of competition. staying focused on our vision and what we are about has worked very well for us. >> you are both fighting for market share in various cities. huber has just launched the pool service and you launch this back in the summer in california. how do you feel about uber pooling rides to undercut your market share? >> i think new york is a great example of a market where public transportation actually works really well. you can get a two dollar ride pretty much anywhere. there are other markets that public transportation does not work very well. it takes twice as long. and just having a product is kind of one stat. and building a peer-to-peer type service. it is the corner of what we've done. it gives us a strong advantage with share ride. >> you have yet to really expand overseas. what are your plans their? >> there is a massive opportunity in the united states specific to the car ownership market. they are creating a better taxi. that is not what we are about. $2 trillion every year, what we are building is an alternative to owning that personal vehicle. that used to be a symbol of freedom in the country. in the united states, the surface is being scratched. it starts from, hey, i'm going out and i don't want to drive. that is kind of the taxi replacement. now they are using it to commute to work every day. we are excited about how it is performing. >> you said there is much ado about the rivalry between uber and lyft. executives speak directly about it. they openly admit that he tried to thwart your fundraising efforts earlier this year. and i want to read for you a quote from the article. he told investors, "before you decide if you want to invest, make sure you know that we are going to be fundraising immediately after." >> that strategy didn't work. we raised 250 million. what we are doing has worked really well. when a competitor continues to name you and calls investors, i think there is concern about what we are doing and how it is succeeding. we are excited about it. >> john zimmer there with betty liu. we will be back after this quick break. ♪ >> time now for bloomberg television "on the markets." go ahead and take a look at the major indexes. green across the board. the dow jones industrial average up, and tech stocks making the big gains of the day. ♪ >> i'm emily chang and this is "bloomberg west." what is the secret for success? it is their nimble startup culture that helps drive innovation. can large companies learn something? you have been doing this now and i am curious about your progress. you've worked with several companies, from ge to intuit. >> nobody was more skeptical than i was. getting calls that we want to implement this entrepreneurial management system. i have been really surprised. the companies you mentioned as well as the hot up and coming startups. once you have a successful product, you update. and you have one other person working for you. how do we teach people -- >> a company like microsoft, they arguably missed some of the big technological shifts of the last 10 years. >> it's about if you are willing to change the whole blueprint. many companies are built around functional silos, not getting close to customers. if you want to foster that kind of innovation, you have to be willing to set up internal startups. >> i have been thinking about amazon a lot this week. amazon is this culture of pizza box teams, that you don't want a team starting a project that is more than one late-night pizza session away from being too big. that is part of the culture. they are cheap, small teams that work fast. what about when that approach is wrong? >> i believe culture comes from the process. the way people get promoted. if you want to have a culture of small teams, you find a way to break it into smaller problems. you have to set that process decision from the top. when i go to corporate america, i meet with teams with a 25 or 30 person part-time committee. everyone got assigned there. there is no ownership. you don't get assigned to a startup one day. >> diversity, we have seen a lot of dismal numbers coming out from apple to facebook to google. what kinds of things -- where have you seen progress? we know these numbers are bad and we want them to be better. >> diversity is the canary in the coalmine. you ask yourself if this was really a good selection process. >> if you walk into a room with straight white dudes like me and say you did not get the best people possible, you didn't even try? >> the odds are extremely low. just do the math. i think companies are starting to take this seriously, but it's a slow progress. i believe the process we use determines who shows up. people don't apply when they don't think they will be selected. >> the blind screening process. they have a low number of women even though they are concerned about the problem. take a listen to how they've changed their process, but won't go so far as to blind screen. >> how have you changed the interview process in subtle ways to make sure that you are getting the best people and you're not discriminating? >> one thing that has changed recently is that we have a female partner in every one of the interview rooms. >> why not completely blind screen everyone? >> i could not observe their interaction. >> they feel like they don't get a good read on someone if you don't meet them. >> i couldn't agree more. a lot of the selection processes are multi-staged. how about review the written applications? that is what we do. we have people submit the written form and create videos. we make sure everyone applying has to go through the same process. and do work to make sure people understand how the process works. >> any companies doing this well? >> i wish i could. i would say most of the companies that talk to me about this, they talk about the problem, but not as interested in talking about solutions. >> not one single company? >> i could not name one. i wish i could. >> it is something to aspire to. >> your startup conference happening this weekend. thank you for joining us and having us back on the show. reverend jesse jackson is pushing for more diversity in technology companies as well. he is meeting with microsoft and amazon and is with us coming up. ♪ >> you are watching "bloomberg west," where we focus on innovation, technology, and the future of business. the majority of microsoft's workforce is male and white. no surprise there. the numbers tell a broader technology story where companies like yahoo! and facebook have similar percentages. the founder and president of the rainbow push coalition, reverend jesse jackson, has been meeting with tech ceo's. he joins me now from seattle. cory johnson is still here. you met with satya nadella. what did he have to say when it came to diversity? this is a guy whose big public mistake was saying that women should not ask her raises. >> i think he regrets having made that statement. they will see that for those locking down people of color represent market and not the cost of doing business, it is achieving growth. while we focus on stem and engineers, beyond that, 60% to 70% of jobs -- the whole range of workers can be employed in these industries. >> is it interesting to have a conversation with a guy of indian descent? >> in microsoft, an indian president, female cfo, and african-american members of the board with a white attorney in terms of mr. grant. i think they do get it and they see that the market is like that. so is talent and creativity. we also take a hard look and begin to invest in stem development. 600 children studying stem. they need their school to do just that. there is a pipeline to start with a pipeline. the chairman of the board where they teach computer science and they teach engineering. with florida a&m and other schools, they must see the value in such a relationship. we are overconsuming and buying the product. >> we were speaking with -- they say tech executives can't blame this on a pipeline problem when the pipeline has changed. amazon executives, they tell us who they are meeting with and what is your message with amazon? >> amazon has been the most reluctant in contrast to microsoft. amazon is all white, eight men and two women. i mean, they have a lot of shovel-ready talent on the market right now. for people like luke capital and williams capital to be part of the offerings. we have a talent surplus. we want to connect with them and it's not a zero-sum game. >> one of the things that make silicon valley work is not just the innovation, the ideas, and the people, but the university of california at berkeley, stanford, also the peninsula. bringing students to the workforce. with tuition rising, it seems more people of color and more women out of those schools are not able to pay for those. how does that lessen the possibility of having workers of color? >> that is a problem and should be the forgiveness of student loan debt. it would end the boomerang situation. soon it can be a big deal. and also we find that we cannot just limit it to those schools. john comes from florida a&m. the papers for the founding of google, david drummond is an african-american. there is no talent shortage. working on an insecure basis, they can learn stem. we will be in this for the long haul. >> are you saying you are against the program? it's costing african americans and people of color jobs in silicon valley? >> they are not using workers and training them at home. that is the real point. >> i want to ask you about your conversations with tim cook, because you have been speaking with apple specifically. we have been speaking about satya nadella, a hefty pay package. what about your interactions with apple and tim cook? >> we hope to meet with tim cook soon. they've had the pleasure of having offshore tax havens having the tax breaks brought back home. they have not been as sensitive as they must be. we're working with truckers and advertising agencies and marketing. we are in this area. equal employment can be used here as well. >> thank you for joining us, president of the rainbow push coalition. pandora shares have taken a beating this year. will a new look help refresh growth? we hear from the music streaming services cfo next. ♪ >> welcome back to "bloomberg west." i'm emily chang. music streaming service pandora is getting a new face. the company rolled out a redesign for its mobile platform available to 3% of iphone and android users right now. but it will take effect for everyone over the next few months. we talked to michael herring at the technology conference in scottsdale, arizona, and started out by asking him about the latest update. >> we are really excited about this new rollout. it's a brand-new u.i. about personalization pieces inside the product. it helps you look and identify how you find songs, stations, really discover new music. change the way you establish your profile. it really services a lot of innovation that we've been doing for years behind the scenes, driving the music that we play for listeners, and now you can see what the personalization looks like. >> and this predicts user growth? >> we see a lot of growth in our service. we are at 5 billion hours a quarter now, 76 million users. the hours are the lifeblood of our ability to drive our business. by engaging people more often and through more devices, it helps us build loyalty to a product and helps build the business. >> mobile is big for pandora and so is automobile listening. spotify signed a partnership with uber so listeners could listen to music driving in uber cars. why is listening to music in cars so important? >> it's a big part of the auto experience. half of all radio listening occurs in the car. our strategy has been addressing in-car listening through personal automobiles. we have been working for years, we have over one third of all autos that will be sold this year coming with pandora integration, and so that has been our strategy. from a business development perspective, we have a lot of partners. there are a lot of different experiences out there. spotify is a very different service. pandora really addresses what is ideal about auto listening, turn it on and let it play. >> the hiring of sarah clemens used to run m&a for linkedin. what will we see for strategy for pandora? >> sarah has a broader mandate. she is the chief strategy officer and looks at a lot of different things pandora can do. we have the best music listening lean-back experience that can be offered. so how do we take that and add on capabilities to enhance the listener experience and the connection with the artists themselves? artists can improve their own careers. she went and hired lars murray to run that. it allows labels, managers, and artists to use the platform of pandora to betterr plan their own careers. we try to help with the music ecosystem. we will look at other kinds of content, and maybe there is m&a involved in that, maybe it is mostly organically developed. how do we stress the opportunity with pandora. >> do you ever envision pandora being part of a larger organization? part of microsoft, facebook, a bigger tech company to become more competitive? >> i think we are very competitive as is. i think it is way too early to think about that. we are at the beginning of the opportunity. the mobile advertising market is just emerging. we think 9% of radio in the u.s. will grow substantially. we've hired a full management team and it's all in place, ready for the next phase of pandora's growth. i think as an independent company we can do a lot of things that you couldn't do if you had other masters or other things. all we care about is the music experience, the best listener experience we can possibly provide to our listeners. we're not trying to sell you a phone, we're not trying to sell you an operating system. we are just trying to play the right music for the right person at the right time. >> and it is time now for the bwest byte, where we focus on one number that tells a whole lot. cojo, what do we got? >> 3 million. 3 million people worldwide have motoro neuron disease or quadriplegia like stephen hawking. intel assigned a team to improve the sensors that professor hawking uses to communicate. it's so well-known because of stephen hawking. intel is announcing free software to help the more than 3 million people with that affliction. >> he said the human race is at risk because ai could become so advanced we could not keep up. >> the systems were not advanced enough for him, but intel was able to help him out. intel is now making it free to the world. >> that's an incredible story. thanks for watching this edition of "bloomberg west." we will see you later. ♪ >> the following is an important paid program about humana paid medicare plans. >> welcome to medicare. the program that guides you through the medicare options available from humana. there are many different medicare choices available today, but are you sure you have the right medicare plan? are you with the right company? do you wonder if you could save money with a different plan? 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