tv Bloomberg Technology Bloomberg June 4, 2019 11:00pm-12:00am EDT
♪ emily: i'm emily chang in los angeles and this is bloomberg technology. coming up in the next hour, hanging by a thread. why the threat of antitrust elation has silicon valley and tech investors on edge. plus, rating uber. after a rocky ipo performance, uber's underwriters are defending the stock with bullish calls. but a big tax investigation is looming. chinese citizens continue to push back on censorship.
just how high can the great firewall in china really go? but first, to our top story, the u.s. government is increasing its scrutiny of big tech companies. on top of the department of justice and federal trade commission dividing oversight for possible probes into google, facebook, apple, and amazon, the house judiciary says it will spearhead its own investigation into possible antitrust practices. house lawmakers plan to hold hearings on the matter, a move endorsed by house majority leader nancy pelosi, who had this warning. "unwarranted, concentrated power in the hands of a few is dangerous to democracy, especially when digital platforms control content. the era of self-regulation is over." joining me to discuss is our bloomberg tech correspondent. what is the latest development today in all of these potential
or actual investigations? the only sort of publicly confirmed new investigation is the one you mentioned coming out of congress. the doj and ftc have not even confirmed reporting that we and others have put out there that they have divvied up the four big tech companies. and they are preparing their own antitrust investigations. the companies have not confirmed it either. the companies have reached out and are trying to figure out what is going on. i have reported about exactly what is going on. at this point, we should probably be careful and not necessarily say that this is the new microsoft antitrust case or the new big at&t antitrust case. but it does feel different. just the way that the conversation is coming around. if you look back at the last year or two years, politicians on both sides of the aisle are talking about antitrust. it is just obvious that these point -- at this point that these agencies want to do
something about it but we are not sure what it will look like. emily: certain sources i have spoken to, legal sources who understand how this work, say it is more likely that these agencies could take a look at these companies given that they have divided oversight. but also given that they which are the responsibilities. but do we have a sense of how much more serious really these potential investigations or potential actions could be today, now 24 hours into this? gerrit: i think dividing them up is a sign that this is real. over the past few months, reports of meetings, conversations, lawmakers asking agencies to jump into this. it shows that those requests and theseheard organizations are getting the gears turning toward these tech companies. the questions come down to how are the tech companies responding? they are in a bit of a wait and see because they don't quite
know what to expect yet. emily: let's talk about alphabet. alphabet has been the target of various investigations in europe. they have paid i believe three huge fines. there has been some speculation that alphabet could be the most vulnerable here given what we have already seen in the eu. is that the case in the united states? gerrit: i would hesitate to say that alphabet is the most vulnerable. when you look at some of the public rancor, i would say facebook has borne the brunt of some of the attention of both politicians, advocates, as well as consumers. it is true that alphabet has had to pay upwards of 8 billion euros in fines, that is nearly 9 billion or 10 billion in u.s. over the last few years. dollars they have also kind of honed their playbook. the big question is, you had that nancy pelosi quote was talking about these companies being big and their economic power being dangerous in it of itself. the last years in the u.s., that really hasn't been an issue.
regulators have not been concerned with size, they have been concerned for prices for consumers and consumer welfare. these companies have helped consumers, helped bring down prices for services. things like google search, gmail, they are free. in terms of products, they are great. we of course pay with our data. the question of consumer price is sort of up in the air. what we are curious about, has the u.s. legal system, government system change the way it is thinking about antitrust just go after these companies for their size rather than their effect on the end consumer? emily: in the meantime, google also has an app store, the most popular operating system, the android operating system. that said a majority of users use it. that said, we saw developers sue apple for antitrust. apple is under the microscope intentionally from the doj but also senator elizabeth warren has called out the app store and whether or not that model is anticompetitive. tim cook, the ceo of apple,
pushed back on that today with cbs saying we are not a monopoly. in fact, apple only has 30% of smartphone market share. what is the difference between the apple app store and the google play store? gerrit: in some ways they are similar. they face the thing challenges. they charge that same 30% fee to anyone who wants to sell anything on their marketplace. they are the two main app stores , at least in the united states, and other western countries. there's a lot more when you go to china but that's a different story. in the u.s., they obviously are the only way to download apps. there are some more kind of complicated ways to download apps but most people download them through the app store. and if you want to sell on those, you have to pay to 30 for -- that 30% fee. i think a lot of outside observers, that 30% fee is likely to come down. it's really difficult to keep justifying it. emily: we will keep following these stories. bloomberg's gerrit de vynck will
have more later on the show. salesforce gave a quarterly estimate with top wall street estimates that they will continue to see rapid growth. marc benioff has just new markets to reach an annual revenue growth of 26 to $28 billion by 2023. salesforce continuing to expand by hiring more workers in the u.s. and around the world. tracking productivity and data integration. coming up, uber has had a rough start as a public company but the ceo of the private equity firm general atlantic thinks it's still a critical milestone. has to say about the transition from private to public, next. this is bloomberg. ♪
emily: some would consider uber's ipo to be a bit of a disappointment but bill ford, the head of the private equity firm, said it wasn't despite the plunge in sales. he spoke with our erik schatzker. this is that the bloomberg invest in new york conference. bill: i think the lesson is, or what is happening, is more of the growth of these companies is happening in the private market rather than a public market. uber, if you step back and talk about a $60 billion-plus valuation, what an incredible accomplishment. so much of that happened in the private market. i think it is a reason why so many institutional investors and retail investors say i have to get exposure to private markets if i want to participate in the most interesting innovations, and with the most interesting entrepreneurs. investoras an uber
dating back to 2015. you enjoyed some of that appreciation while the company was private. do you look at the ipo and call it a disappointment? bill: i don't. i talked about it as a milestone of companies development. they still have to work their way in the business model for profitability. they talked a lot about that on their earnings call. the end of theas road, i see it as an important milestone. i think it is an important achievement making that company available to public investors. i think it has got a long rate -- long way to go. >> if you could re-edit the movie thus far, how would it look different? bill: the only thing i would have probably done differently is maybe push the governance transition in the move to a professional ceo a little bit earlier. i think some of the challenges that they are dealing with today, or they dealt with over the last year would have been
dealt with a year or two earlier. the on that, i think they have done a great job. erik: you raise an interesting point about an ipo for a company like uber being a milestone. at the same time, we have acknowledge, at least under the current construct, so much more value is created well the company is private. what future does that leave for the public market? it raises some existential questions about the purpose of the public market and why people would participate there and if you had a choice, why you would want to be in the public market if you can be in the private market? bill: if we go back, when i started in the business 25 years ago, the public market was a source of capital because the private market was small, the growth equity market was smaller, and the buyout business was growing. the publicappen in markets. if you wanted a two-year growth to the future. now, capital is widely available in the private market.
what ceos are realizing is that they can accomplish a lot more as a private company, and forestall the distraction of quarterly earnings, meeting with investors, that management time that gets taken away to manage being a public company. that is a shift. i think there are positives and negatives. emily: that was bill ford, ceo of general atlantic. sticking with uber, in the wake of washington's antitrust, we've learned about yet another investigation. the internal revenue service is now examining the ridesharing company's taxes for 2013 and 2014. according to a company filing. we are joined by bloomberg tech's eric newcomer. who of course covers over. how serious -- uber. how serious is this investigation? eric: i think it shows that regulators have looked at every
piece of uber. in 2013, 2014. it is hard to know how serious it is. uber has a very interesting financial situation. it lost $10 billion in operating losses over the last few years. this is a money-losing company that was very new, they had to figure out how to do its accounting. we will have to see over time what the irs finds. it speaks to a broader array of inquiries that this company has faced. we don't know definitively where they netted out, if they did. emily: does this mean they could eventually pay more taxes in certain jurisdictions, or that they could end up with a huge fine? eric: there are lots of questions about uber's taxes. a lot of it is the carryforward. they are losing so much money
now, and the hope is that the day they turn a profit, they can use a lot these losses to mitigate future taxes. a lot of the questions are around those carryforwards. they set up their taxes in the netherlands trying to avoid some taxes and the rules have changed. it is a constantly shifting ground for uber. the question here is, with those profits so far away, the tax situation when it does turn a profit is filled with a lot of uncertainty. emily: we heard from the ceo of general atlantic, who also happens to be an uber investor, talking optimistically about uber. we had some analysts coming out today rating the company as a buy. some of the has slipped. some analysts are signaling preference for uber over lyft. eric: i think it is hard to read too much into it.
there was so much excitement ahead of the ipo. i think there are a lot of people who still buy into the story we were talking about before uber struggled on the public markets. the banks and many who worked with uber on this ipo are coming out and giving it a buy rating. obviously there's a lot of thought that goes into that. figuring out the uber investment, there is this huge trade-off between buying into the belief that the transportation industry will change overall versus a closer analysis of the losses. that is a big bet to make. emily: bloomberg tech's eric newcomer, thanks for stopping by. coming up, the trump administration may have secured a new weapon in its fight against huawei. how european customers are helping the u.s. turn the screws on the company.
emily: as big tech companies brace for increasing regulation in the united states. our own scarlet fu spoke with cofounder and chairman about whether he thinks bigger is still better in the current landscape. take a listen. >> by and large, i am very bullish on u.s. trade. there are a lot of things we do with the u.s. u.s. are a lot of companies whether it is planes or software. i am very optimistic about the future of u.s. trade. scarlet: it may be a bit rocky getting there. >> fundamentally it is good.
scarlet: if i recall correctly, infosys relies on the u.s. for about 60% of its revenue. does this impact you directly? nandan: not really. we are hiring 10,000 people in the u.s. we are setting up six innovation hubs across the country. a terrific response from local governments, governors, even from the federal administration. i think the fact that we are working on creating jobs here, hiring young people, training them, that is working very well, and i think we have a great reputation for job creation in the u.s. scarlet: do you feel like you have an open line to the government to make sure visas are a two way street? and it's possible to bring talent over? >> i think the fact that we are so -- doing so many things are working out. scarlet: i want to get your thoughts on the u.s. increasing oversight on various technology companies. we have been hearing about how
facebook, google, apple, perhaps even amazon are caught up in this. we have seen europe tightened its grip on these industries. while this shape the landscape for big tech companies overall? nandan: it is early days yet and we don't know exactly where this will go, but it is true that there seems to be more interest in these issues. but i think it is very early to comment. scarlet: is being big a good thing or bad thing in this day and age? nandan: i think being big is important. scale benefits. we have platforms that have billions of users. it is important to have scale. scarlet: let's talk a little bit about prime minister narendra modi's victory. last month saw a landslide victory for the prime minister. how do you see modi using his mandate? nandan: i hope it will be used for economic reform. india is well-placed for reform
like simplifying labor laws, getting the banking sector back on track. creating jobs. a lot of the things we have dealt with. i am hopeful that with this majority and a clear mandate, they will do that. scarlet: what kind of timeline? nandan: very quickly. all governments have to do reform within the first few weeks and months of their tenure. emily: that was nandan nilekani, infosys chair and co-founder. it has been less than three weeks since the u.s. cut huawei google's android system. in europe, people have been trading in huawei phones. in a press conference with theresa may on tuesday, president trump said the u.s. and u.k. will find common ground on huawei. take a listen.
pres. trump: we will have an agreement on huawei and everything else. we have an incredible intelligence relationship and we will be able to work out any differences. emily: joining us from washington to discuss, our own sarah mcgregor, covers trade. will there be an agreement on huawei between the u.s. and u.k.? sarah: we will have to take trump at his word he is working towards that. it will suit the u.s. interests if europe and other countries are looking a little less favorably on huawei. if sales are dropping. the u.s. is jumping up and down, trying to get attention from the europeans. they are saying huawei is a security threat. a key way to cut them off is obviously the u.s. market but also to look abroad places like europe and the middle east. huawei cells are much more significant and have been making inroads. it might be good news for the trump administration if sales are dipping and people are questioning their purchases of
huawei equipment and cell phones. emily: if u.s. actions on huawei -- there is the blacklisting and trying to convince other governments around the world not to use their equipment. if we see huawei really take a hit from some of these actions around the world, will this fire up the chinese even more to retaliate against the united states? sarah: i guess the risk we are looking at now is the u.s. blacklisting american suppliers to huawei. americans give some of the key components into some of their cell phones and equipment. once there is a 90 day grace period that ends in august. that could affect the operating systems that huawei works on. it might not get the same parts that it uses. it is probably scrambling now to diversify its supply chain. , they arer huawei trying to develop their own operating system and i think the
chinese government would say it is full steam ahead this is its crown jewel. this is its biggest telecommunications company. it is sort of the future that china wants to have, leading in innovation. emily: president trump is also trying to convince the u.k. to get on side about a possible trade deal. if they come to terms on a trade agreement, how would that affect the global dynamics between what is happening with the u.s. and china now? sara: the first step in a trade agreement, which the u.s. and u.k. have been working towards, they have created some working groups and got some groundwork. of course, for the u.k. to leave the eu so they have that baton, and it is able to ratify and hammer out trade deals. that is a big first step. after that, there's a lot of things up for grabs. trump brought in the possibility today that the national health system of britain needs to be brought into one of the
negotiating tables. it needs to be one of the issues they discuss. the u.k. said that is off the table for them. it's great to say you want to negotiate a trade agreement, but what are the parameters, what are you actually negotiating? will you cover services or trade? there's a lot of things they need to figure out first. emily: all right, sarah mcgregor for us on trade in washington. thanks for that update. coming up, the u.s. government sets the stage for formal inquiries and escalator pressure on big tech amid criticism that practices are harming competition. who's got the upper hand? we will discuss. this is bloomberg. ♪
emily: this is bloomberg technology, i'm emily chang in los angeles. back to our top story. the u.s. government's potential probes into antitrust behavior by the likes of google, facebook, amazon, and apple. we have also got the house judiciary committee getting in on the action with hearings and an investigation. so what is the difference between the agency's actions and congress? the former assistant attorney general in charge of the antitrust division explained that earlier on bloomberg. >> that process will play out publicly and is unlikely to have a major impact on what the
federal trade commission and doj will be doing if they decide to investigate. those tend to be highly confidential, non-public, on the merits. and divorced as much as possible from whatever political debate may be going on on the presidential stage. emily: to discuss in washington, we have charlotte, the policy counsel for public knowledge, a washington nonprofit focused on shaping policy for an open internet. prior to that she worked in the anti-competitive practices divisions of the ftc. also in washington, bloomberg senior analysts jennifer read. charlotte, we are wondering what this division of oversight actually signals about the intentions of these agencies. does this mean they will investigate? does this mean an investigation is imminent? or is this procedural? charlotte: it is simply procedural but it indicates an
investigation is likely. this is the type of process they don't often go through if they are not going to open an investigation soon. but it could happen that they end up not opening an investigation here. emily: jennifer, how are the agencies different? is the objective ultimately exactly the same? jennifer: ultimately, both would be conducting broad investigations. when i say both, the law-enforcement agencies, the doj and the house judiciary committee. but the ftc and doj are looking at conduct to understand if these companies have engaged in conduct that goes beyond just aggressive competition and crosses the antitrust line, and has harm to the competitive process and consumers. congress can look at little bit more broadly. we look at not just conduct, but how the economy has changed with technology and whether or not the antitrust laws can handle policing these companies.
and whether legislation is needed, or some sort of a change to the antitrust laws to rein in the power of these big tech companies. emily: the doj has oversight into an investigation of apple and google while the ftc takes facebook and amazon. i am curious about the role of congress here. is that just for the public to have these hearings and do this investigation? or could that lead to policy and regulatory changes? charlotte: i think that is why the congressional process will be crucially important. the agency process as bill baer said earlier is going to be secret. the public is not going to have a lot of insight into what is going on. i think is a good chance that there are additional problems caused by these companies that are not antitrust violations, but different types of problems. we do not have an expert regulator for digital platforms.
having a more public process in congress could build a record to have some new legislation to address these problems. are any of these four companies a bigger risk than any of the others, or at bigger risk for being broken up, or being regulated? jennifer: i think it is difficult to say because antitrust investigations are always very fact intensive. so really, it depends on the facts and what the conduct is that the federal trade commission or department of justice finds that they don't like. and what the proper remedy is to fix that problem. usually these remedies are narrowly tailored. but for instant, if there is legislation like the type of legislation that elizabeth warren is talking about where a company cannot run a marketplace and also be a participant in the
marketplace, then a company like apple or amazon would have a bigger risk because they are companies that run a marketplace and compete on that marketplace. emily: what could the possible penalties be? i know this will take years to play out. what are the scenarios at the end of a 5, 7, 10 year plus road? charlotte: at the ftc, we like to say remedies, not penalties. the goal is to promote competition. it is often not actually intended to be a penalty. course iremedies, of think divestitures will be on the table. it may be significant divestitures like a breakup. unlikely, it is seen in the courts as a very severe remedy. another remedy might be interoperability requirements. that is a major way of promoting competition. these markets are characterized by network effect.
the more people connected to the network, the more valuable it is. if you make that network open up, and allow other competitors to interoperate, that can address the network effect power and create more competition. emily: we know about the antitrust investigations at microsoft in the 1990's and what happened with u.s. telecom. you've got the ftc investigating facebook right now on privacy issues. facebook has said they are preparing for a multibillion dollar fine, which would be multibillion dollars more than any thing the ftc has ever levied. would you say that the ftc is in really uncharted territory here right now with the power and the scope of these companies today? charlotte: i don't think it's uncharted territory. there are a lot of new considerations. these are fairly new products.
there are definitely going to be some new things that they need to figure out. i think that the ftc and doj are used to dealing with very big companies. they will be able to handle it. emily: meantime, jennifer, of course we saw the markets rebound today. it seems to be nothing to do with antitrust issues and more what mexico, more with the fed. but over time, how devastating could it be to the valuations of these companies given that this could drag on for years? jennifer: first of all, the important word is time. i don't see anything much happening for a long time. these investigations take a long time. if they end up going to court, that takes a long time. as charlotte said, one of the options is structural. a breakup or divestiture of certain assets. certainly, if that is what the remedy ultimately is, i think that could have a pretty
significant impact on these companies. the interesting thing is that charlotte mentioned the interoperability. if we think about the microsoft days and the department of justice trying to create a remedy to break up microsoft, they could not do that in court. but there was forced interoperability that opened up the markets for a lot of new innovation and competition. at the same time, the regulators may look at something like interoperability and think it may solve some problems provided there is a problem. emily: we will continue to follow all of this. bloomberg's charlotte and jennifer, thank you both for weighing in. coming up, the rise of digital dissonance in china and how they are testing beijing's firewall. we will discuss it next. this is bloomberg. ♪
emily: in bloomberg businessweek, the regime of china's president xi jinping is one of the most restrictive the internet has ever seen. they have spent $180 billion a year on surveillance and censorship tools like the great firewall. the controls are tested by a new group of tech savvy activists. bloomberg businessweek editor jeff muskus joins us. tell us what these activists or dissidents are doing. jeff: some like the folks at greatfire.org, a collection of activists that have been up and running since 2011, they do their best to provide a jumping off point for people who are in china who want to use -- either through browsing tools or social media -- a different kind of site they don't normally have access to if they abide by the
rules of the road. but we also spoke with folks including laborers that may be planting trees and spraying pesticide, they are unlikely activists as it gets tougher and tougher to speak up online. emily: i was living and working in beijing for the 20th anniversary for the tiananmen square massacre. it was about the same time facebook got shut down and twitter got shut down. and any time we aired a story , i was at cnn at the time, about tiananmen square or showed a video, that would be blacked out in china. how has that restriction increased under the regime of xi jinping? it has always been there, to a certain extent, but it has gotten more restrictive and not less. jeff: he certainly made good on his annual promises to crack down harder and harder on most
of the ways that people are allowed to express themselves online in china. some of the biggest tools at his disposal to do that include cracking down on apple to force them to remove hundreds of virtual private network apps from their app store. if not counterproductive, it has been unsuccessful. emily: there was a sense when i was there, and this is now 10 years ago, that young chinese students were much more concerned about getting a job and more concerned about the economy than they were about political freedom. do you get the feeling that is changing? or that there is more of a push back against xi jinping's regime? jeff: you are probably right that there are a lot of people that are still very happy to sort of put their heads down and not become targets.
the lesson of the story is that it can be a very lonely fight. and so the folks like the great fire people operating from the shadows or these laborers that are willing and have spent time in jail for complaining online about things their local government officials are doing, they tend to argue that the case they are making is to try to slow the sensors down or get people to think twice about the compromises they are making. if you have any illusions they are not turning the tide just yet. emily: it will certainly be interesting to see if the trade war has any impact on sentiment if it leads to some sort of greater economic downturn. bloomberg businessweek's jeff muskus, thank you so much. you can hear more from the magazine editors and reporters every saturday and sunday on business week on bloomberg television.
mike has criticized australia for not providing a big enough platform to encourage tech innovation there. is that changing? our correspondent spoke at the morgan stanley australia summit. >> on the innovation side of things, i think australia is going to innovate. there are certainly things that the government could be doing to help. look at the last three or four years on r&d and concessions for example. getting those smaller companies started and going. that certainly hasn't helped. at the same time, we do have a booming tech industry here. it is going really well. irregardless of what the government does. which is great. they can certainly help a lot more than they are, but we have a pretty rosy future. reporter: there seems to be a dominant theme as we speak to people today that a lot of the progress will be made regardless of public policy.
>> there are certainly things they can do that are progressive. there are things they can do that hurt industry. if you look on the energy side of things, the lack of stable energy policy is probably one of the two leading factors of why it is so expensive in australia. the instability makes it hard for long-term investments to be measured. and you require a larger margin of error rate on doing those larger scale infrastructure projects. there are a lot of things that you can do to accelerate those transitions. but they are not going to reverse technological progress. that is out of our government hands. reporter: what advice would you give to a young tech entrepreneur and aspiring innovator in australia to try to navigate the environment? >> just focus on your customers. ignore the government. ignore the things that are going
on. try to build a great product, hire some amazing people. we have great talent in australia. we have a lot of universities turning out world-class engineers. we have a lot of customer problems to solve. it is worth having big businesses, small businesses, rural communities, other industries that we are strong in. energy is a huge sector. but i see a lot of agriculture startups. we have a lot of problems to solve. focus on that stuff. build a great business. reporter: i was looking at your twitter feed earlier. the pictures of your attendance at the apple worldwide developers conference. how does that play into your activism? does it hinder it to address the issues that are important to you? >> it is a blessing and a curse to have that profile sometimes, for sure. we try to use it for positive
things and advocating for changes that we think are there to be made. more business leaders in australia should do it. we have a community of business leaders who speak out on issues and say what they think are the right solutions. we are not always going to get it right. we will make mistakes, but i with that profile come some of a responsibility to try to explain, try to understand, and advocate for positions that move our economy forward. reporter: and in australia, you make it about the company or the ceo. does the experiment -- does the experience play into that? is it a cautionary tale? >> you have to run a good company at the same time. you cannot separate the two. we want to make it as best we can in terms of hiring the best talent.
keeping that talent, growing that telling, nurturing that talent. we have amazing company culture. you have to put that first. that is what has gotten us here. we have so many great customer problems to chase down and solve. we don't turn up to work quiet every day. we are bullish on what we are doing as a company. emily: that was mike cannon-brookes. still ahead, companies bring ai to organ transplant and pioneering what you might call medical miracles. that is next. this is bloomberg. ♪
transplants are rejected by the recipient's immune system. a molecular diagnostics company is improving that process by bringing ai to transplant care. the company has developed a genetic test to match organs with recipients, as well as to neurology to monitor the immune system post operation. joining us is caredx ceo peter. thank you for joining us. tell us exactly how ai is helping to improve the matching process here. peter: there are two big issues in organ transplantation as you were mentioning. on the one hand you need to match an organ to a recipient. then after transplantation, you need to care for the patient throughout the lifetime of the patient. we are applying novel sequencing technology to match the organ with the recipient. after that, we are using the same sequencing technology to care for the patients, detecting rejection episodes early. making sure that physicians have
the information to treat the rejections prevent that occur in the past. emily: how does the sequencing technology work? how is it different from a matching process without your technology? peter: this is next-generation sequencing. it is the future in diagnostics. we are applying this technology to match an organ with a recipient on a very granular level. we do that in organ transplantation, bone marrow transplantation and transplantation overall. in the post transplant area we can actually detect the dna of the transplant in the bloodstream of the recipient. that is a very novel technology. the technology is revolutionizing how we can care for patients because it can detect rejection episodes earlier. add on the artificial intelligence platform that can allow clinicians to have a deeper insight aggregating all of the various data streams. it allows them to make better
decisions in potentially detecting issues earlier than they can do today. emily: how are you improving success rates? what are the numbers? we have a clear focus as an organization to improve the patient's life or three years. we are early in the ability to impact this and we are building an amazing platform in order to do so. we can focus on immune modulation, focusing on adherence and compliance. making sure patients are taking their medication and seeing their doctors on a regular interval. afterwards we can focus on standardization and precision medicine. individualizing the care for that the interval -- individual patient receives the care that we are all about. we have a tremendous platform to deliver and partner with the transplant ecosystem to make that available for transplantation. emily: your revenue grew 85%
year-over-year. how does this scale? how do you get this technology accessible to more recipients? peter: this is really an amazing growth story. we have built this amazing platform in transplant medicine. over the last 18 months, we have achieved 5% patient penetration in teen the transplant patients in the u.s. we see this $2 billion market opportunity. when we talked about it for her -- this $2 billion market opportunity for her five years ago, people were wondering why that is. they live for 10 to 15 years and there is a recurring revenue opportunity. caredx has a model that follows these patients over a long time , which, financially it is very attractive. but more importantly, we are changing patient's lives by detecting rejection episodes early. scientifically very interesting.
emily: how do you expand this technology? is there any intention or any ability to expand beyond organ transplant? hand, on the one transplantation is a unique opportunity being at the pinnacle of medical science. you called it the miracle of medicine. and it truly is. if you think about it, innovation happens at the top of the innovation curve. if you have innovation at the top of the pyramid, this will allow us to learn a lot for other areas. we are doing transplantation for the top 200 medical centers in the united states. once we have built an ecosystem that allows us to have artificial intelligence and augmented intelligence, we integrated into electronic medical records and we can roll the platform out to many other areas. emily: fascinating stuff. peter maag, thank you for sharing what you are doing with
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