Transcripts For KNTV Press Here 20110918 : comparemela.com

down for a dinner with a rather amazing collection of folks. you have probably seen this picture, the first supper with all of these names put together. facebook founder mark zuckerberg on one side of the president, apple founder steve jobs on the other. big names all around. eric schmidt, then ceo of google, easily recognizable. the man though with his back to the camera is steve wesley. >> i'm keeping my options open. i will come back to sacramento in the future. >> reporter: westly probably best known as a former controller and chief financial officer for the state of california, and one-time candidate for governor. that didn't get him a seat at the table. his fund-raising did. when it comes to raising campaign funds, steve westly is president obama's right-hand man. he's also deeply involved in green energy as a venture capitalist. on the board at tesla where he is a major investor. steve westly is so connected to clean energy and politics he was on the short list to be secretary of energy. his close relationship with the president has made him the target of critics who wonder if the administration sometimes plays favorites with green companies. we'll get to that issue. let me introduce john swartz of usa today, mike cray of investor business daily. all kinds of things we could start with. let's start with the solyndra stuff. this is a political football for the obama administration. >> it's important to go back in time two years ago. we have a bipartisan national debate where we decided to invest $700 billion in the stimulus to get this country back own our feet. there was a consensus that a good piece of it should be in clean energy, one of the biggest job providers for the future. secretary of energy chu is doing a great job. went out and with a terrific team with people with private sector experience made over 1,000 grants, loans and other investments in fast-growing companies. a lot of the firms, tesla was one that did well and employs wem over 1,000 people and is the newest auto manufacturing facility in california, the first in 50 years. some haven't gone well. i don't think this is a big striez. i think there were more successes than misses. >> sit a cost of doing business? the chinese are investing more money than we are and they will miss, too. >> exactly right. when you invest in any area as i am an investor in clean tech you have hits and misses. the good news is despite the fact that solyndra was a miss the government had a lot of hits including tesla, a-123 and other firms that have done well. >> and you were not involved in the solyndra deal. you are not an investor. >> no involvement. >> but in green energy at every turn. >> the solyndra thing comes up and it is a black eye for the administration and for clean tech. and political football aside there are a lot of things going on. is there a legitimate concern about the government putting taxpayer money behind green start-ups. should there be a concern there? >> i think it is smart policy but is the government investing in the right companies? hindsight is always 20/20. people say, how did i miss ebay, google? clearly there will be misses. the good news is -- and this is what people forget. the united states is creating a huge number of jobs. two firms have over 95% of the clean tech ipos in the world. the u.s. and china. this is a dead-on race between the two. here's good news. despite all of the concerns and criticisms about china inc. and the chinese government subsidizing solar, the united states today is a net exporter in solar. we have great solar companies including first solar in arizona. we are doing a good job. i hope this company can continue to play a leadership role in that area. it is important strategically to the country and a great jobs employer. >> when alternative energy is inevitable it's something you cannot overlook. not to preach this, but a couple weeks ago i was in portland and secretary chu was on a panel that we were discussing the issue with. they said that in terms of job creation and in terms of innovation, this is one area you absolutely cannot bypass. actually, we were talking about the idea of who is the next steve jobs. he and a panel of deans of engineering around the country said the next steve jobs will be the guy that comes up with energy efficiency ideas and models. >> before you answer that, steve, let me jump in and make an observation that all of steve jobs products are manufactured in china. maybe china should be manufacturing solar panels. they manufacture everything else. the ideas come here and manufacturing goes here. can we beat them in manufacturing? isn't that the issue with solyndra? >> look, we manufacture plenty of things including intel chips close to here. so we will do fine. the u.s. is still the largest manufacturer in the world. but if you go to china it's interesting. everybody there says, my god, costs of manufacturing here are going through the ceiling. we are losing all of our manufacturing to indonesia, bangladesh, india. the fact is china is going through the same curve japan went through in the '60s, korea in the '80s and now china. >> solyndra did have a problem competing with china. it's a lot of other western companies, u.s. companies. can we really compete with china? >> absolutely. solyndra had a product that was out of the money. it was generally costing them $3 a watt to make solar. that's too much. if you look at the leading providers look at first solar, still an $8 billion to $10 billion company, arizona based. america can do it. >> without getting into the types of solar, solyndra had a specialized type of solar that was a bet that didn't pay off. it doesn't mean every solar plant in the united states is doomed. their particular kind of solar was too expensive. >> exactly right. there are another dozen companies right now, no more than a few miles from where we sit, each working on what they think will be the next generation of more efficient solar technology. i want to remind you that when you get down to about $1 a watt, that's when solar reaches grid parity. when you get to the point where you can replace coal, natural gas and not have any of the carbon byproducts, pollution, you have done something extraordinary in this area along with parts of china leading the world in that. even though there were misses, china and the u.s. have made very smart bets on solar. everybody else is racing to catch up. >> just the one political question is should the obama administration have known solyndra wasn't going to work? >> look, the department of energy made over 1,000 loans and grants. they are going to miss a few. venture firms miss a few. everybody misses some. three years after the bet or two and a half years after the bet, everybody says, ho-hum, they should have known. it wasn't clear back then. a lot of smart people worked on this. should they have known better? probably. >> one of the underlying concerns with not the technology but teng nears. that's one of the big problems and the administration talks about it. they are aware of the idea that we graduate 120,000 engineers a year from the united states versus a billion for china and india combined. that may be the bigger issue that's sneaking up on us. >> when we talk about a deal loans and you were the first to point it out but as the viewers advocate one of your investments, tesla took one of these loans as well. when you speak of this you are speaking as the beneficiary of the department of energy as well. >> my job as a venture capitalist in clean tech is to find the best companies to get the best return for pension funds, endowment and so on. we made close to 30 investments. we have invested in some of the firm that is the d.o.e. -- >> we talked about favoritism in the obama administration. is it possible that supporters of the obama administration lean toward green energy? >> that's always the case. the key is, is the d.o.e. making smart bets and is there a thorough process. having watched what happened with tesla, three-year process, thousands of pages of documents, the d.o.e. is thorough. will they have miss? absolutely. everybody does. you will find when the story is told they did better than most. >> talking of tesla and green tech and clean tech with tesla there is a lot of flash, certainly a great branding campaign and a lot of promise. no doubt about it. the bottom line question is, is there a business model that will make these companies profitable. are these companies going to be profitable? tesla loses a lot of money. >> it's a great case. tesla makes money on every car that comes off the assembly line. >> a profit. >> a profit. we should be proud of that. these are the cars of the future. this is the first company, with all the automakers in the world that has solved the problems electric cars have had. the new car goes 300 miles on a charge and has better performance than most bmws or other sports cars. >> steve westly let's talk more about green energy in a minute. we'll be right back. we are talking even over the break with steve westly. you are a major investor in tesla. we were talking before the break. it is more than a motor car company. that's where the safe bets are. i don't know if five years from now there will be a tesla, but they have investments with toyota and other companies where they will make stuff. >> that's right. a lot of people, not just in the silicon valley but people like warren buffett said the majority of cars made in the world in 20 years will be electric. why? electric cars are over 50% cheaper to operate. this is a big deal. one of the things i think is terrific about tesla is may that i can great cars, a five-seater coming out in 12 months, but they provide batteries and power trains for big companies like toyota and daimler. that's a big business. >> i think that's where the money is. >> people aren't sure where the company is. $200 million this year to over $600 million next year. this is a real company. >> solyndra laid off about 1,000 people just like that. tesla has a new plant and a couple hundred employees there. what's the ramp-up in jobs for tesla? how many jobs is tesla adding? do you know that, steve, how quickly and how soon? >> i have stepped off the board. we sold our position in the company. so i don't know. i can say that i'm proud that the newest auto manufacturing facility in the united states is manufactured in the business friendly state called california. >> unfortunate time called fremont. >> you will get mail about that. >> i know you have questions about social hour here. >> we saw the back of your head at dinner with the president. i know it was you. i wonder, we didn't hear much about what was discussed there. i wonder if you can touch on a couple of topics. one i was curious about was energy. you have google and facebook there. they are consuming a ton of it through data centers and servers. can you give us a little bit of an outline of what happened? or what was discussed? >> the dinner discussion was off the record. i can say everybody came to the table with a very detailed, provocative question for the president. everybody walked out thinking, good god. this guy has complete conversancy on my issue. it's unique that he's come to say, give me your advice on how the president can continue to be the world's innovation leader. the other issue you touched on, data centers, is a big deal. most people don't realize that to run things like facebook, twitter and linkedin requires huge, huge buildings with literally 32 million servers in the world running our data centers. there is another firm samsung which is korean but has offices in the silicon valley that has a green chip which saves a quarter of power in the servers. it will save more energy than argentina and thailand together generate. this is an example of how innovation is changing the world, making the plan greater. >> there was a statistic that google runs a quarter of a nuclear power plant. it would be one quarter of the output of a nuclear power plant. >> and growing all the time and the same thing for facebook. that's why when samsung can show we can make greener products to save power, great thing. >> we have three minutes left. this amazon sales tax thing. you used to balance the books for the state of california. >> correct. >> should the state of california be tax iing out of state internet purchases? >> in my opinion they should. i helped take a firm called ebay public. i am all in favor of online commerce, but there is no reason in the world that the ebays and amazons of the world should not have to compete on an even playing field with the book sellers. >> is this something states should do or be federally mandated? >> it should be a federal law. i'm hoping the congress will act quickly to say online retailers should have to pay the same taxes as everybody else. online retail is a great thing, but everybody in america ought to play by the same rules. >> you're in a unique position with both sides of the coin. ebay, controller. two years ago your answer may have been different, i'm guessing. two years ago would your answer have been the same? >> no, i said the same thing, took arrows in the back from my friends, but the fact is in america everybody ought to play by the same rules. there is no reason in the world the retailers on main street should be disadvantaged. >> so -- >> i think it's going to catch on. >> when we started ebay people said, how big can this business be. 50 million, 100 million? it's a $40 billion business, bigger than people thought. >> thanks for being here. up next, amazon. we have reaction from keith g raffle when we return. welcome back to "press: here." ikea last week made a slight change to its line of bookcases and this is not something that would normally dprab our attention. the bookcases ikea decided should be deeper so that people can better use them to display prized items and choch keys instead of just books. the economist magazine jumped on the fact as proof the world was moving away from traditional books in favor of kindles and ipads. that idea was tweeted and retweeted. ikea said it really hadn't thought of the change that way, but bookcases aside, there is no question the book publishing industry has been disrupted. the kindle is the best selling thing on amazon.com. and now amazon is reportedly looking into a subscription model for books. all you can read for one set price. keith raffle is best selling mystery author whose latest book "drop by drop" is only available on e-book. he's a former start-up ceo, former chief lawyer for the select committee on intelligence and vice president of a company mapping the human genome. i was thinking of getting the sprinklers fixed in the front yard. knock it off. this is your second time on "press: here." knock it off. you're making the rest of us look bad. >> i have a short attention span. i say i have career add. >> apparently. you have done everything. and a harvard grad on top of it. joined by john swartz and mike craig. your latest book, e-book only. why? >> i'm a silicon valley guy as you alluded to. how can i resist trying to ride an e-book wave? at the same time it gave me an opportunity to try what i call literary portfolio diversification. i had two manuscripts. i said to my agent. here, take one and do it the traditional way and sell it to a new york publisher. i will take the other one and put it on amazon, barnesandnoble.com and the i-bookstore and we'll see who does better. >> are you telling me nobody would print your book? >> my agent says different. in the internet age we try to business mold. >> how has it worked in terms of the industry? do you need a publisher to market your e-book? what's the cost difference there? >> it's astonishing. one of the things i learned is that the book "drop by drop" i did is selling for $3.99, which is a good value, i like to think. at the same time i get a higher royalty on that than on my traditionally published books. it's a win-win. >> are more people reading it because of the format? >> it's only been out a couple of months. i'm confident at the end of the year i will have sold more books than i do the traditional way. what happens in traditional publishing is that there is an enormous wave when it comes out. it is featured in bookstores and it goes away. what's happening with "drop by drop" on the different sites is that sales are going up month by month. exciting. >> it helps to be an established author. i tease you about nobody will print your book, but you have, in fact, many a book in a bookstore and they have sold well. if i want to read more keith raffle i don't care if it's on e book or not. >> some people do care, but, yes, it helped. >> you are an established name. >> yeah. there are a bunch of people kept saying when is the next book coming. when i got an e-mail, tweet or anything i kept it and told them, okay, i'm back. it's an e-book and several people said, oh, i better buy a kindle or a nook. >> you know you're a killer app when somebody buys a kindle just to read your book. >> i'm not a kindle person. i am a big fan of keith's. i bought and read "dot dead" a year and a half ago. >> god bless you. >> i read "smasher" two months ago. the new one, i don't have a kindle or the phone or -- i have a computer. >> you can order them online, you know. >> it's interesting. someone said, you know, i don't want to buy a new device. i said, you can read it on your p.c. or mac. someone said i don't want to do that either. someone read it on an iphone and wrote back and posted the review on amazon and said, wow, it was a real screen flipper. >> people are getting used to the little screens. >> the kindle has come down in price. $125 or something. >> $129 or something. >> it's not a minor expense but it's not the end of the world. >> if the screens get larger on an iphone like we hear the iphone 5 may have a larger screen, people are accustomed to reading things and digesting things on a smaller screen. i work with somebody who reads books on an iphone. >> at the same time there is a fight about whether you would rather read on an ipad or kindle. as an author, one or the other, i don't care. >> you get the money either way. do you? >> yes. >> regardless of apple or amazon selling it, you get the same money. >> yes. >> do you have any statistics as to how it is doing on apple compared to kindle as compared to whatever else? >> since we are not far from apple head quarters here i'm reluctant to say it, but a vast majority of the books have sold through the kindle store. that doesn't mean they are not being read on an iphone or ipad or something else. you can buy a kindle after them. the vast majority is on amazon. >> kindle users read a lot of books because, hello, they are kindle users. ipad users may or may not read on the ipad. >> that's media consumption for an ipad. >> even the ones who are reading on the ipad often times download the kindle app and buy it from the kinldle store. >> is this book another tech thriller? >> you're so nice. tell us more about your book. >> okay. forget the question. you ask the questions. >> scott was making fun of my resumé to open the session. >> whether it was the harvard education or the millions made in silicon valley or being part of the select committee on intelligence, i was definitely making fun of you. >> thank you. >> what i did was, i was interested in knowing if i could do this. i spent four years working for the select committee on intelligence. i wanted to get back in mind that material. it was a while ago. i didn't know if i could get back there but i went to my favorite cafe, put on my noise cancelling head phones, drank the green tea and ten minutes later i was right back in washington again. it's a thriller that opens in the valley. but most of the action is in d.c. >> was that the

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