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tv   Bloomberg Technology  Bloomberg  December 21, 2016 12:00am-1:01am EST

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>> it 1:00 p.m. hong kong. asia-pacific markets have been holding on wall street's overnight highs. hong kong has rebounded. stocks keepna climbing from six-week lows. sydni saying its highest level since august of 2015. he is also filing a lawsuit. india's biggest conglomerate
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says this was moved by the majority of directors. much of northeastern china is covered by thick smog right now. flightscausing canceled , and warnings from people's to stay indoors. they are under red alert for pollution warnings. quality is 15 times above internationally accepted danger level. global news 24 hours a day powered by more than 2600 and analysts in more than 120 countries. this is bloomberg. afternoon trading getting underway in hong kong and china. that 40eeing it snap decline. this is bloomberg. ♪ >> this is bloomberg technology.
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coming up the dow and nasdaq , close at all-time highs. is silicon valley finally joining the trump trade? blackberry has told -- doubles down. a move pays off. we dig into the company. facebook takes on fake news. they have a plan to curb bogus stories. will it work? now to the lead. the market rally in the u.s. and the dow clears a record highs with the latter just a few points away from 20,000. check out my bloomberg. the last few months have been bumpy perspective type -- for tech stocks. cory johnson joins me to break it down. nasdaq underperforming the lights of the dow and the s&p 500. cisco is the worst performing and we have significant tech
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stocks within some of those overall benchmarks. corey: there are legitimate reasons to suspect tech will underperform. for example, if there is a shakeup in international trade, tech companies are big exporters. companies like oracle. you have companies like tesla. over 50% of their revenues were from scandinavia -- or international as well. if there is a disruption in international relations at which -- might start with a tweet or policy. that might affect this. caroline: looking at another key chart situation. you can get into these charts of this one.look at the financials outperforming, on the downside look at that yellow.
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the likes of facebook, alphabet, netflix, google, all have been key underperformers. how much are we still looking at also on fx issue? there is reasonable concern. a lot of this rally has been so strong that some investors are saying i'm going to sell my winners and look for things that are in favor. i will look at infrastructure and energy. selling to those winners starts to make sense as investors are nervous about the rally and looking for places where some things are the most overvalued. wei think it is interesting see the likes of jeff bezos and mark zuckerberg being hit by sometimes and lagging in their own stocks. it does seem to be picking up we , have seen warm words coming from donald trump in the meeting last week. has the rally got further to go, are we going to see a significant catch up being paid,
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will the rally continue? predicte it for me to the markets. the approach of mark zuckerberg and jeff bezos toward their stock is a good approach. own the stock, don't trade the stock, and make a long-term investment in a company that will do well. the long-term development in these companies, the stocks will respond to the economic development of the company or lack thereof. for the case of facebook, they have warranted it, there growth -- there growth is slowing down. that is a big area for concern. that is the big f in the fang right there. we will be looking at one key stocks that did pretty well. >> blackberry is in the midst of this transition but it has been coming really slow. their move to software has been
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coming very slow. this business has already been through one big-name change. i would not be's price is completely down the line we see something other than the blackberry. it is a completely different business. with the blackberry, the company boosted its 2016 earnings outlook very nearly 70%. earlier, i managed to catch up with the ceo from their headquarters in ontario and asked if these margins were sustainable. >> a normal growing software company could definitely do better than 70%. it could do it. >> how about the software revenue growth? you said that would be 30% on track.
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are you aiming for that in the next fiscal year as well? guest: no. the market is growing next year. we committed we will be growing faster than the market. caroline: the belief in the security that blackberry offers. are you seeing a pickup in demand at the moment? >> in a certain way the answer is yes. the answer would have to be is. -- would have to be yes. mobility is one of the biggest vulnerability points. this is where we excel. we are the number one player in that space. where mobile meets security.
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a lot of conversation, we feel comfortable in where we are and where we sit with the customers. caroline: it is interesting you were announcing yesterday, and new research center in canada, the focus on automation, driverless vehicles. this is a crowded space. you're up against apple and the tech giants and the automakers as well. how do you fight with in this competitive space? guest: i do not fight with them at all. first of all a month ago we announced an agreement with ford motor company. we are providing software to help them build the next generation car. i will let them tell you but we are helping to do that. we had engineering people helping them. they are using our software and this is an example of what the
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driving innovation centers will focus on. all the automakers are going to be customers, they will be our partners, all the tier one like lg and panasonic will be our partners. they have already been our partners and we are proud of the relationship with them. we are not setting ourselves up to compete with automakers. and not competing with tier ones . we want to build the foundation so cars can be safely put together and put on the road. caroline: not long ago we saw another announcement from blackberry. it was a licensing deal. you're getting out of the hardware and letting a chinese partner builds that. how much are relationships with china under threat with the new president-elect donald trump?
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are you cautiously optimistic or concerned with the direction of u.s. and china relations? guest: that is a complex question. let's start with technology. i provide all the software technology. where the majority of all the security, secret sauce is an. in that sense, there is no truth in that if i build my phone in china by a chinese partner than my phone will not be more secure or be less secure, whatever the right english is. our security is paramount. we do not have any issue with that. we control all the software and the security software associated with it. we also have devices in canada. we do not have any interested in outsourcing those things. the net of all that is that i will not be concerned about having us work with a chinese company.
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as related to u.s. government policy and where the trade issue will go, nobody knows the answer to that. i heard a guest talk about putting a tariff on developing countries. i assume the guest is referring to china and the currency manipulation situation. at least they are accused of that. with all that discussion going on with the president-elect. i assume that cooler heads will prevail. >> that was the ceo of blackberry. twitch is taking on the heavyweights. the company looks beyond gaming. we will catch up with the ceo next. this is bloomberg. ♪
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1 uber continues to bleed money from its balance sheet. they lost more than $2.2 billion. in the third quarter it lost more than $800 million and that is excluding the chinese operations it has exited. this according to a person familiar. when they are bringing in sales they are on track to exceed $5.5 billion this year. twitch is stepping into the video live streaming old dress. -- gold rush. it is looking down gaming and branching out its streaming offerings.
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it is taking on some heavy competition from the likes of facebook and youtube. we caught up with the ceo. >> we are always going to love video games. we super excited to expand the platform and welcome a broader array of partners to be part of our community. >> you have but 2 million creators per month. how will this expand, are you using the creators out there and expanding their knowledge base or is it attracting new people to the platform? guess: we have been experimenting with the creative category for more than a year now. we have discovered that while there is a ton of crossover, you do see lots of gaming creators wanting to do arts, wanting to do comedy, 20 to be artistically -- wanting to be artistically creative. you also see new people coming in who have never created before
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and had now feel like there is a place for me. it really is a mix of both. there is slightly more people crossing over that coming in. in a long run we will see a ton of new people creating. that is our goal. we would like to get a lot of new people creating on the platform. caroline: is it investing in marketing, going with the amazon platform? guest: we mostly focus on the product, we like to think that the product should speak for itself and we want to have a great credit for creators that makes sharing the video should -- video and share your passions fund by the other thing we do is we invest heavily in a team. they are finding creators to the point where they can become a partner. they have the opportunity to monetize their channel and they
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get access to special events at twitch. we tried to have a great product and we are out in the community. caroline: how does amazon react to this? guest: we -- the most common -- prominent thing we have done is twitch prime it is a twitch . it is a twitch oriented part of amazon prime. it comes with all the benefits. also on twitch benefits. it is helping money into the pockets and for customers. amazon prime is a great product. we try not to force it. outside of gaming, we're still in the learning phase. i am positive as we grow we will find amazing things to do with amazon. we are focused on growing that's nascent community. the community you have so far
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that loves the gaming side of thing, are you worried about moving beyond that? >> we worried about whether our community would embrace their -- that or not. we recently ran a survey to ask people what they think about twitch adding non-gaming content. than 70% of our creators either agreed or strongly agreed with the statement very i think twitch adding more content than just gaming will not only be good for me but the whole platform. your're looking at particular platform. what about live streaming on facebook? the? competition is fierce. who are your main competitors we try not to be super competitors. we try to focus on the creator. i think today our greatest competitor is still cable news and cable tv in general. much as peopleas
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talk about the death of tv, it takes up a huge number of hours in the day. if you account people watched which where they're are coming in for many hours at a time, that behavior looks a lot like cable tv does. andr internet platforms entertainment. the biggest single service of people spending their time for entertainment is still television. that is our biggest competitor. >> that was twitch ceo. is gettingfacebook help from pointer. we will speak with the director of international fact checking next. and twitters revolving door keeps swinging as the ceo tweets he's out. what this means for the company. this is bloomberg. ♪
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>> since the u.s. election, facebook's outlook on fake news has evolved dramatically. they pulled a 180 turning to third party fact checkers to flag false stories. is this enough question mark we spoke with the director of an international fact checking network to discuss the strategy and their involvement in it. they developed a code of principles for nonpartisan and independent fact checkers. facebook decided in order to be a third-party fact checker as a minimum condition you will have to sign on to our code of principles. caroline: facebook is the arbiter of who is the third-party fact checkers. >> it requires transparency of all kinds. it is a necessary but not
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sufficient condition to be a fax checker -- fact checker. caroline: they had been pushing for mark zuckerberg and facebook to take new steps. are those enough? >> we are in the very early days. i hope you do not think i am dodging the question. we are going to have to wait and see for a few weeks how this works out. i think it has been a lot of pressure on facebook to do something. now it has acted. we need to see how this works out in practice. in theory, we think it is a welcome choice. it may or may not be effective. caroline: in terms of where it could be tackling those stories that are obviously false, the more misleading articles potentially that come around and
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catch wildfire, do you think that will be able to be blunted to some extent, will we see some misleading stories pushed out? >> it is important especially in the first stages. facebook and the fact checkers are aware of this. that the concentration beyond the 100% totally fake fabricated stories. the pope endorsing donald trump. those stories are the ones that did really well by the social network this year. those are the start of where the fact checking can have an effect. when we start going into the grayscale and the half-truths it will be more complicated and there are other platforms to do that. i am convinced that this experiment could have already a very beneficial impact if it t the out -- weeds ou totally fake stories. caroline: we have had the u.s.
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election in 2016, we have germany, france, the netherlands, a wide range of political events happening next year. how is the institute preparing itself? guest: nice campaigns we've seen a lot of totally fake stories do really well on social media. in the italian case it was ballot boxes allegedly stuffed and have a million votes found in an imaginary town. i think this is a problem of international scope and i believe that facebook is looking to roll this out internationally. the network has members from across the world and they are eager and keen to see this
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rolled out cautiously and carefully but in other markets beyond the united states. caroline: should other media or large social networking companies be adopting this, what about the likes of google and its unit youtube. how will other social media giants potentially tackle this? guest: google announced a fact check tag. it is looking at ways to help more accurate information surface to the top in search. it famously had the problem after the elections with the false story of donald trump winning the popular vote reaching the very top. caroline: coming up. it was another green day for u.s. markets as the dow approaches 20,000. yet some big tech names are lagging behind the broader market since the election. we will discuss next. this is bloomberg. ♪
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you wouldn't pick a slow race car. then why settle for slow internet? comcast business. built for speed. built for business. it is 1:30 p.m. here in hong kong. i am angie lau with an update of your top stories. lawmakers have been asked to raise the public borrowing limit by as much as $21 billion. they say that used to be at least $31 billion to solve the country's bad debt crisis. the body of the murdered russian ambassador to turkey has now been flown home. moscow said they will not allow ties to be broken by his murder, which is being linked to the bombing get of aleppo. been bombing what it calls islamic extremists.
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berlin police said stepped up the hunt for the truck driver that attacked shoppers in a market in berlin. he is -- the original suspect was released without charge. they followed him as he left the scene, but there is no recording of him in the truck. is in long beach for that port. liquidation is following its bankruptcy. it approved the sale of the 54% sake -- stake. dayal news 24 hours a powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg. let's get a check on how the markets have been trading in the asian pacific today. >> a much better day than what
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we saw across the region yesterday. some of the geopolitical risks have been put to the side. positive coming through in new zealand. we have seen a turnaround in the nikkei. ying that's the yen strength and against the dollar. a good day in shanghai, up by over 1%. we are seeing a little bit of bargain-hunting coming through here. also a positive day on the hang seng index. 6/10 of 1% gain coming through in hong kong led by some of these casino players. still seeing this weakness coming through in development stocks in hong kong. a little bit of mixed movement coming through in southeast
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asia. solid issue coming through today. this is bloomberg. >> welcome back to bloomberg technology let's get back to our top story. it was a record-breaking day for the u.s. market, dow as nasdaq closed at new highs. our big tech names feeling the lift after a bumpy few weeks after the u.s. election. our guest joins me from portland, oregon. the dow on the 30 stocks, one of the biggest losers was cisco and another was microsoft. tech seems to not be taking part. guest: there is a lot of moving parts in the names i cover, facebook and google among them.
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the individual issues going on, you have currency issues that will always be at play in the context of the postelection environment. maybe an inflationary economy might be helpful but on the other hand, you have more uncertainty which may restrain spending by advertisers. you have issues around whether or not you have to place people outside the u.s. to build your business. more or less regulation difficult to anticipate. it is a complicated mess. caroline: we can show this complicated mess rather prettily on bloomberg. i know you cannot see them, but i will spell it out to you. it is showing you we're moving across to the likes of facebook. they have been underperforming, nasdaq has been underperforming, the rest of the rivals. you cover facebook and alphabet. are we going to start to see any
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upward trend going forward as as stock continues and they look for what has not caught the wind as of late. guest: it is interesting and maybe because i do not look at the entire fang sector. let alone the market. maybe i do not see quite the same uplifts trends. the comedy specific factors seem to be more dominant. i think through investors lenses as well. we have a number of potential headwinds. the measurement issues that have been coming to light recently are problematic. maybe constraints growth but the bigger issue is they are expecting on the buy side, they are expecting more robust growth. it is a fascinating phenomena. even though you have a company that is eating the industry and taking share, it may not be
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meeting expectations so that holds off some of the growth. google has similar issues where investor expectations have gotten so robust that as other investors come back to her thin terms of their expectations, it holds down the stock. these companies are so massive now, some of it is the law of large numbers in terms of how big they can get. caroline: we have plenty of headwinds hitting the likes of facebook and we have had negative headlines regarding the news, potentially not acting quickly enough on terrorist content. notably digging into one key headline saying that they are accused of misleading the eu. how much could this be a hit, they are facing a fine of up to 1% of their annual revenue. guest: it is not an unimportant story i would save.
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it is probably not one that investors will pay too much attention to. it matters more to be clear at a business level in the long-term. it looks like a he said she said story at this point. it is difficult to state where it plays out. there is a bit of an issue where european regulators want to make sure they have the ability to assert their authority on the u.s. dominated industry. so there is an element of the eu being as aggressive as they can toward facebook and google. the reality is facebook and google are eating for lunch of everybody who sells advertising in europe as well. if you are a domestic player there, you're worried about their dominance. probably have not reported on, i have not seen it referenced in the english language press but france has introduced a you tube tax. things like that will happen
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more commonly in europe. caroline: also digging into one of the laggards of recent months. twitter dumped 23%. it is not a pretty sight. and yet more for headlines coming out. the exit circle continues. we are reporting that the vice president of product is leaving as well. how concerning is this? >> the defense against the dark arts chair. the head of product role at twitter has been quite a place. the rotation out of that division is something that i think worries investors. when they are not so fortunate as to have a full-time ceo. maybe one day they will. that contributes to the problem. it is difficult to be positive about twitter and i call myself one of the [indiscernible] bolds.of the bolts --
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expectations were not realized. expectations were always overblown i think at the earliest days and they came back down to earth are you the probably crashed a little too hard and things like this do not help. you can always point to anyone person's choice to leave a company is coming down to individual career development, better opportunities elsewhere, their view of the upside of the stock. it is very systemic there at this point in time. caroline: more on the place of jack dossey. it is great to get your perspective. thank you for your time. since president-elect donald trump met with tech leaders last week we have not heard from the attendees trump has not had a strong relationship. tim cook is speaking out about the meeting.
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techcrunch obtained an internal memo where he explains why he attended the meeting saying we engage when we agree and when we disagree. you do not change things just by yelling. president-elect trump's note stranger to a bit of yelling on twitter. could his war of words lead to a national security crisis? we will discuss next. this is bloomberg. ♪
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>> twitter has been lauded as the tool that helped donald trump when the white house. that win the white house. it has seen its fair share of twitter wars launched by trump. as he prepares to take the highest office in the country, can those off the cuff tweets
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spur a genuine national security crisis? bob anderson joins me and rob ta vron. i want to direct a question to you first bob. these off-the-cuff comments, the fact foreign agencies can already be discerning something about his character, is this a worry from a security point of view? >> from a security point of view anytime data leaves a secure environment in today's world, people are looking at it. there is no doubt that countries and organizations are looking at our new president-elect but as he starts steering toward the oval office there will be a lot of global intelligence firms and also the government helping him steer to a much more secure manner in communicating. caroline: when we are looking at
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international diplomacy, look at some of the tweets we have seen over the weekend claiming china stole a u.s. drone this weekend, announcing he spoke directly with the taiwanese president and we have the tweet showing what he can let go of. you you agree this can be reined back once he comes into office? >> i would be looking at the numbers. if you look at his numbers he has reined it back. he averaged 30 or 35 tweets a day in october. in december he is back to about five today. they are a little more benign as he has shifted from campaigner and marketer from preparing to govern. you gave a couple of exceptions this weekend where he threw the chinese off guard with a couple of different tweets. caroline: the hackers that have potentially been widely
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concerned about the dnc, could we see hacking getting into the likes of donald trump's very own twitter account, is that sort of a threat possible? >> you have to look at it as a threat but i will tell you when it comes to national security and national security assets especially around the president, there is a lot of organizations making sure that that information and the way the president to indicate stays safe i think it is one thing that we all need to be on guard about nowadays whether it is the president or people in the suites of private enterprise. security is something we talk to clients about. caroline: give us a sense of what happens to the media within all of this. the middle man seems to have not been needed. this has been going straight to the consumer.
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will he have to start chatting with the media rather than boycotting them? guest: he tweeted back in december, he wants the american people to hear him and not hear it through the lens of the media. fdr went to the radio directly. reagan went to tv directly. this is a very savvy president-elect who will take advantage of social media. he needs to be security conscious and -- i do not think will abandon his ability to talk with the american people. >> what does this mean potentially for evidence that maybe we get misinformation at times, we saw a tweet saying that the popular vote went to hillary clinton because of millions of those who voted illegally. perhaps not completely truthful. what do you feel is at risk here, is transparency of positive and the risks being
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perhaps some misinformation at times? guest: was the information on purpose, was there a strategic reason, or was he taking the story and running in a different reaction? he is adept at changing the subject. he will take whatever story is running, when the steve bannon issue was happening he pivoted and tweeted about flagburning and had the entire media pivot with him. he has a unique ability to give it the story. finding a way to do that when he is governing will be difficult. there are not very many minutes in the day he will tweet. what will he have time to do? caroline: have there been any positive reactions and things that have swirled around the fact that may be donald trump as president-elect can go direct to
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the voter but direct to those he is in diplomacy with, is there any upside to the president having such a direct point-to-point with those in the community? >> i think it is a first. we are all witnessing something that has not been done before. until he settles into the presidency and i agreed to see how long he keeps this up or settles into more of a traditional role, there is no doubt that he has used social media to his side and what he wants to communicate, kind of cutting out the middleman telling a story. caroline: wonderful to have your points of view. coming up, we take a look at which tech ajit's are said to be -- gadgets are said to be the holiday winners this season. this is bloomberg. ♪
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jumpingadvisor shares five cents and were one of the best performers in the s&p 500. the signed an agreement to let customers book on trip advisor. this deal follows a similar one made with priceline. trip advisor had been struggling to shift its revenue model for one weird gets paid a fee for referring its customers to other websites where users can reserve directly on its platform. it is crunch time for holiday shoppers. the smartphone becomes the dominant electronic. we take a look at which other gadgets are expected to be the biggest winners and perhaps the laggards of the season. with the smartphone being our one-stop shop for all her scheduling and fitness tracking needs, other gadgets are having
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trouble gaining traction this holiday season. alreadyd fitbit have cautioned investors by lowering their holiday forecasts. in september, fitbit rolled out two new wearable devices, the charge 2 in the flex 2. soon after, the company issued weak holiday sales guidance and lost one third of its market value. about 30% of people in the u.s., u.k. and australia who had wanted a fitness tracker no longer use the device. gopro told investors it expects a lousy holiday season. the ceo defended the demand. >> there is a misconception that demand for gopro has been waning. it is a misconception because they sell through at retail has never been better. >> both fitbit and gopro our young hardware companies that have fallen short of their promise.
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virtual assistant like amazon and echo and google home are jumping in to compete against smartphones' personal assistance. oppenheimer estimates 10 to 12 million virtual assistance could sell during the holiday. painting a potentially rosier picture for the devices than gopro or fitbit are offering. let's talk tech gadgets. first of all which home gadget should i get to solve all my you -- all of my bills -- my ills when i am at home? >> there are two options, google home which came out a few weeks ago and then the amazon echo and the cap. it comes down to which ecosystem you are in. if you are on an iphone, you can tap into both. you can use the echo or the google home with an iphone. would probably want to get
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the home device or google because that can take advantage of some of the android functionality and the whole google ecosystem. >> if i was a bit of a gamer, i was at the christmas party playing away with the vr, should i be getting into virtual reality, what is out there that i can purchase this holiday? guest: vr is super early. the oculus rift, you have to hook up to a pc. if you are just a consumer like you and i, i would not have one. over time, those things are going to shrink. you are going to be able to wear them, buy them on the shelf. for consumers, a smaller kit than the oculus rift. google has their own, it is the fabric headset, less than $100. you can connect it to the new pixel phone. that is where consumers are going to get a vr/ar experience.
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we are going to see more advanced the our equipment in the next couple years. we already reported that apple is working on their own. there is a lot to come. >> talking about apple they are , looking more at the vr and the inside of cars one key product you are writing about. guest: we had a big story about the mac. and there is a lot of detail in there that the mac is taking a backseat to ipads, iphones, apple watches, other products. given that the mac is 10% of revenue while the iphone and ipad combine for over 75%. it makes some sense. but don't forget that mac users are a key group of people that rebounded apple out of the brink of bankruptcy in the late 1990's. it is an important market and people should expect that a
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company as rich as apple and resource-filled as apple should be able to walk into gum at the -- and to gum at the same time. they should be able to get a new iphone out the door every year and they should be able to get new macs out of the door but they have been lagging and people are taking notice. they just came out with a new macbook pro in early november. they are doing some upgrades. a new imac with ports and graphic cards and a new version of the imac pro as well as the 12 inch macbook. >> thank you very much. i wish you well on the holidays. that does it for this edition of "bloomberg technology." we will continue this conversation. that is all for now. this is bloomberg. thank you for watching. ♪
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manus: intensified search for the burning christmas market attacker. islamic state claims responsibility for the assaults. exitsa may moods a transitional phase and suggests be made withinld six months. and lawmakers set to vote state aid for italian banks. said to be failing to laura investors. ♪


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