tv Bloomberg Technology Bloomberg August 28, 2019 5:00pm-6:00pm EDT
[captioning performed by the national captioning institute, which is responsible for its caption content and accuracy. visit ncicap.org emily: i am emily chang in san francisco, and this is "bloomberg technology." coming up in the next hour, ivends ya looks to take advantage of the trade war two the u.s. and china. the country easing foreign investment rules, a big win for companies like apple. facebook gets ready for 2020. it updates rules for playing adams, but will it be enough to make a difference? and north carolina's fight against vvaping.
ey halt e signature sales to teens. first to our top story. remember friday when trump here by ordered u.s. companies out of china. well, if india gets its way, it may welcome apple with open arms. the indian government eased foreign investment rules in a number of sectors, including manufacturing and retail, a move officials hope will attract companies like ale. they hope to start online sales in india within months, and alle and foxcon have been laying the ground work for manufacturing in india. to discuss in los angeles, we have mark, who covers apple for us, and david kill patrick. tell us exactly what india is doing here and what it might mean for a company like apple? >> so there have been plenty of reasons why apple has not been very successful in india with some having under a 1% or 2%
phone market share. one of those reasons is they have had a hard time bypassing a lot of laws from the indian government which are required for certain companieo up shop there to produce a certain amount of its products in india. for a company with a supply chain elsewhere in the world, it is a difficult process. this would allow apple to work around that and eventually awe lou them to open up an online story and physical stores in india which would alow them to have a much nkemdicher push in the reggie. emily: we are in the middle of a u.s.-china trade war, escalating on both sides, which india could potentially use to its advantage. how do you think india could potentially benefit here? >> well, you know, india has had very restrictive trade barriers for many years. there was a big drop a couple
of decades ago, but they still have had more restricts than many or countries that are major trade partners of the united states. so this is clearly an example of them recognizing that they can take advantage of the moment and also serve their consumers. because look, apple products are popular globally, and they have not done well in india. i think this is a win for all concerned. certainly it will be great forale and other companies that are shipping into india. but the indian consumer has pretty much not bought iphones at all up to now, so this is a big deal for them. emily: in the meantime, mark, in another story, apple has ologized for its handling of siri audio recordings, saying it didn't live up to their own high standards. in a story involving human crack tors listening to our story on siri, not unlike what
google, messenger and others. tell us more about what apple had to say? >> it wasn't completely a problem they were doing this. the issue is they were doing this while proclaiming every other technology coming in the silicon straily is bad and apple is the only one that does the right thing. they were never transparent about this until today. i think you have to go about 60 pages into a security white paper as it is called that nobody reads to find out that apple listens. to answer your question, the makes made today they are taking a pause on listening in. they are going to only use apple contractors to listen to iri recordings, which is about .2% of all recordsings. then they will allow people to opt in or opt out to have select recordings listened to.
emily: stand by, david. you are going to be sticking with me. mark, thank you so much. we have breaking news out of washington. u.s. treasury secretary sat down with bloomberg news for a wide ranging interview, and as part of that conversation, the secretary said, quote, if conditions are right, i would anticipate we will take advantage of long-term borrowing and execute on that. or more i want to get to washington and alex. tell us about what the treasury had to stay about buying ultra long bonds and the approach it would take? >> there has been speculation in recent years about the prospect of the u.s. issue ultra long-term bonds. they would be good for 50 or 100 years. the u.s. has looked at the idea a couple of times in the past, including in 2017 when steven looked at it hem receive.
it has annual been table. there has never been much demand for treasury bills of that length. but with interest rates falling as precipitously as they have recently for 30-year treasuries and shorter term treasuries, it looks like the threshry department is once again considering the idea very seriously as he says of issuing extremely long-term debt. >> how does this have to do about concerns about a recession given the recent inversion in the yield curve amidst an escalating trade war between the u.s. and china? >> he dismissed the idea that the yield curve inversion signals a recession, which you would expect him to do. he is part of the trump administration, and they certainly don't want to deal with a recession headed into an election year. this probably has more to do with figuring out innovative ways to pay for a yuaning budget deficit. the deficit is expected to exceed $1 trillion again this year, and they need to issue
more debt to cover that gap. long-term bonds would be a way to do that. i am let's talk about what he said about the dollar -- emily: let's talk about what he said about the dollar and whether or not the u.s. would intervene in currency issues. he u.s. has accused china of currency machine playstation given the actions they have taken with respect to the yuan. what will we do in the united states? >> he said we would not consider an intervention at this time. so right now it doesn't seem to be on the table. emily: and lastly let's talk about china. we have got potential trade talks coming up next week. are they happening? >> we have no indication the chinese plan to come to washington next week to resume trade talks. as far as we know, talks are dead for the moment because of this recent escalation between the president of the united states and china, who have raised tariffs on each other's goods just in the past two
weeks. emily: that is bloomberg's alex lane. -- alex wayne. thank you for the update. we are going to continue to bring you headlines from that interview as we have them. coming up, facebook has already deployed an election war room when it came to brazil. now it is adding another layer of protection, hoping to keep next year's u.s. elections safe from harm. that is next. are not to us on the bloomberg app, bloomberg.com and sirius-xm. this is bloomberg. ♪
emily: facebook is making changes to political advertising ahead of the 2020 u.s. presidential elections. the social network is tightening how it verifies who is behind political adams as it tries to clamp down on online misinformation. saying in a blog, quote, people should know who is trying to influence their vote and advertisers shouldn't be able to cover up who is taking for adams. while it won't be perfect, it will headache it harder for advertisers to obscure who 1 behind the ad and make for greater transparency for people. we have our reporter who covers facebook, and david kirkpatrick. facebook has been making small changes to political adams after what happened in the 2016 presidential elections how many times is this different? >> this is more of the same. last year they came out with two things. we needs to verify who you are as an advertiser, that you are
a legitimate lillard advertiser who is registered and not just a russian troll, which is what happened in 2016. they also made a database. they say you can go in there and search for all these adams and see who paid for what. this is an extension of that on the verification side. they want to make sure they are actually get adams from lehman who are registered political advertisers and not fournette agents. they are asking for even more information to verify who those people are. > you famously interviewed mark zucker book the day after the election and asked if there was an impact to the election. he said that was a crazy idea. three years later there has been a 180, but do you think facebook is going to be ready for 2020? >> i really worry. i think that statement that zuckerberg made right after the election and pretty much every action they have taken since then in one way or another up to date scores how fundamentally naive the company
has been and morales continues to be -- and more or less continues to be. this requires more disclosure, more checking of whether the political advertiser really is who they say they are. why didn't they think of that? why did they need to fail and now tighten the sexruse? they should have stepped back a long time ago, even probably before the 2016 election and thought about how their system would be ayou buzarnescued. now we are paying the price for when they didn't do that, and they are trying to back nil, and it has been difficult. emily: i have been in election war rooms, and they have had this in place for several elections around the world. what else have they done, and whatever those things will really make a difference? especially given that the real threat they may not even know. >> yeah. they keep using the arms race kind of thing.
they are saying we are taking two steps ford and so are the bad guys. the two big things we have seen on adams front is the one we are talking about. this is something else they plan to pop up along the way for different elections globally, not just in the u.s., where they basically bring everyone into one room so they can better monitor things like fake news or fake stories that might be spreading. that is a hard thing to do, to manually keep up with the spread of something on a platform with more than two billion people. i think they are going to continue to do those kinds of things. they haven't announced a lot beyond those as their main initiatives, a lot of smaller things within that. but i do think they plan to basically try to fight this with their employees in real time. emily: david, this has gotten a little less attention, but facebook has been adding more humans to its sort of editorial staff to decide what goes up, what stays up, what comes down. as somebody who has a, covered facebook, but b, been a
journalist for many, many years, do you think this is simply what facebook has to do, and is it a failure of a.i. and technology? >> well, there's no question the only way facebook or any of these platforms can really make serious progress is through a combination of algorithms and people looking at this stuff in every possible way and continuing to upgrade the way they do it because the people that do things to deceive are getting better and better also. but i think what people need to remember is that facebook is the primary place in which playbooking happens in almost every country. they can have war rooms in u.s., brazil, or india or the e.u., and that is good. but until they have some way to do this on a global scale in scores of languages, dealing with all the different cultural issues. elections happen every day, and they are being abused almost every day on facebook in all kinds of languages and all
kinds of places. that is a deeply challenging problem for this company to deal with. emily: meantime, facebook seems to be battling regulars in different countries on all front preparing for this election. they all have this libra thing that they announced. >> right. emily: now you have lawmakers preparing legislation to effectively kill it, and you have the head of the f.c.c. expressing extreme skepticism against it. how will that play out as facebook works through this election? >> there have been two kind of storylines in just the last week. one is the s.e.c. thing. it has been ongoing, but it is really the idea that facebook doesn't want to be viewed as a security. it doesn't want to be regulated in that way. there is kind of a debate on where facebook's l birch ra should fall. the second is facebook has 28 partners with them on this, none of which have said anything over last few months. they are now asking them will
you please speak up and support this thing? those are the issues facebook is fighting right now just for get this off the ground. it seems like it is going to be a long road for them for sure. emily: david, what is your take on this whole libra thing? >> well, first of all, they probably shouldn't have announced it when they did. they have way too many other problems, p.r. and real, to deal with. this is not the time for them to be trying something so fundamentally new, so landscape altering, when they haven't address other issues like we were discussing before. on the other hand, the problem they say they are trying to address, in particularly to help with remittances, one of the biggest money sources in world. people working outside of their home country, sending money back. it it would be a major service to the world economy if they could really address that. in that sense, i love the idea and problem they are trying to solve with this, and that they
are doing it this creative way. i think the timing was wrong, and it is very telling, as he points out, that there are many partners that don't seem willing and able to defend this. maybe they aren't even really partners. who knows? this is not effectively rolled out so far at all. emily: david, we have more to discuss with you. stay with us. kurt, thank you. coming up, a new youtube for kid. that is after mounting criticism, the streaming giant is taking a new approach to kids content. that is next. this is bloomberg. ♪
tech who covers alphabet for us, and still in new york, david kirkpatrick. david, almost surprising this didn't happen before given they got the kids app for youtube? >> i had the same thought. it doesn't seem technically like this is that complicated. the youtube app is an app on i-phones and i pads. you can put it in front of your kid and trust what they were going to be clicking through, seeing wouldn't be inappropriate. but a lot of people spend time in front of desktops. a lot of teenagers spend a lot of time in front of desktops of course. this is similar to how your netflix experience, can you click to the kids version right there on the website, and now you will be able to do it with youtube as well. emily: david, obviously youtube has been in the eye of the storm when it comes to this kids content. they have reportedly, and as we
have reported, battled with the f.c.c. for vie lateraling the children's online privacy act. why do you think you should have struggled so with how they handle kids content? >> well, you know, i think kids content is kind of the canary in the coal mine. if you really agree that some serious restraints and controls need to be imposed on that, then it is harder to argue that the same doesn't apply for content for adults. t i youtube has had a very libertine, open attitude all along that unfortunately has played to its disadvantage. and at the moment, children's issues are getting more and more attention around the world when it comes to addiction, online content. everyone can agree we have got to find ways to prevent our children's minds from being manipulated by advertisers.
youtube azes me that and to some stephen facebook as well, have taken so long to really get their arms around this. it is good to see them steps like this now. emily: in the middle of all this controversy, the c.e.o. of youtube has sent a letter too creators in which she states that now it is more important than ever to allow anyone to upload any content that they want. can i explain that? >> yes. if you look at susan, and the announcement today about youtube kids, it is very clear what google's strategy strategy is here. they are saying we will make one product for kids that has a lie level of scrutiny, and the core product will remain what it has always been, which is a relatively open and free platform where, things can be posted before they vetted and get into the real world.
they are saying we are not going to move further on this. of course they have hired thousands of people to respond to flagged posts and take down content that does vie late their policies. obviously violent content around terrorism and those kinds of things are not allowed on the platform. but you can still upload them and they can get past the algorithms that are supposed to stop them from going up. emily: they say people will try to exploit platforms for their own gain. as more issues come into view, a rising chorus is saying whether an open platform is valuable or even viable. despite these concerns, i believe preserving an open platform is more important than ever. and yet that is in a way fundamentally at odds with what they are trying to do with youtube kids. how does youtube continue to operate with these values in place but also remain safe? >> well, unfortunately, i don't
think the answer is going to be found until somehow government and the platforms figure out ways to work together, which we are still pretty far from achieving. the letter on its face is very reasonable and it all sounds great and can't really be argued with, except implicit in it is the whole presumption that just let us handle this. we can do it. we know how to do it. we are going to do 13 sbonsably. don't regulate it. but the reality is there is something fundamentally wrong with a private company making a unilateral ral determination in what is and what is not allowed in what is the town square for the planet. they apply to facebook, youtube and twitter as well. those companies are just desperately fighting that battle, and they are trying to say everything they can, but that is not going to be the way it is going to be decided in the end. government is going to come in.
emily: we don't know the results of the f.c.c. settlement with youtube. why has this been such a secret? >> i don't know if they have even figured out what it is going to look like at the end of the day. it is a secret because both parties have an interest in making sure is it kind of stays under wraps until everyone is ready to talk about that. most people are expecting that to come relatively soon, so we will see what the impact there is. if you look at previous settlements between giant tech comes he is and governmentses whether in europe or the united states, sometimes there is a fine involved, sometimes an unprecedentedly large fine, and they are so big and profitable that they sort of move right past it, and it is unlikely to have a real material impact on how these companies do business. emily: well, we will continue to follow. thank you both. still to come, re-ing the smoke signals. we are going to speak to one
more breaking news. we are getting highlights from steven mnuchin's interview with bloomberg news. our guest is back with us from washington. that steven told us it is under serious consideration. he also said the dollar -- no intention of intervention at this time. situations could continue -- change in the future but we are not contemplating an intervention. please expand for us.
>> i had to be k.g. earlier but they arearlier that not looking at an intervention in the dollar markets right now. the backstory is a president is frustrated about the strong dollar. it hampers his trade policies. a strong dollar means that american manufacturers have trouble selling their exports because prices are so high for foreign buyers. meanwhile, u.s. consumers can buy more imports because they had such a strong currency. that has the effect of widening trade deficits that the president has vowed to close. there has been a lot of speculation that the president may order an intervention by -- u.s. into you currency markets. this may be fairly unprecedented for the president to do this just to combat a strong dollar. they have intervened in the u.s. dollar before for things like a
tsunami in japan that weakened the yen. this would be a strange occurrence. there have been discussions about it in the white house. there have been discussions about it in the treasury. as steven mnuchin said today, they are not considering it at this time. much of thatow discussion involves what is china doing with its currency? >> i think we should focus on the words at this time. this could change at any moment. the president could tweet and all of the sudden the united states is pursuing an intervention. secretary indicated in his interview that they have done some preparations for this. he talked about how it would be more effective if the u.s. intervened in conjunction with the fed and allies rather than trying to sell a bunch of dollars which would have very little impact on the daily currency market.
thank you for helping us continue to digest these headlines. stay tuned for more details. meantime, vaping is back in the spotlight. two of the world's biggest tobacco companies start talks to reunite. a reunification would combine two of the largest most popular alternative smoking products. alternatives may not mean safer. north carolina was the first for state to sue juul and mr. defending the dangers of its products. now the state attorney general is taking another -- taking on another e-cigarette company. i am concerned that these companies are targeting children. they have designed their product, they use flavors that appeal to children, they market on social media channels that
children frequent. they use advertising to advertise -- so to children. they either have it no age verification or inadequate age verification on their website which is against the law in north carolina. making these allegations against these companies because i care deeply about the help of north carolina teenagers. many of these companies are saying they are giving adult cigarette smokers a safer alternative. if they take products off store shelves as you want them to do. is that depriving adults of a safer alternative? them to do is to stop marketing and selling to kids. the kids love the flavors. they also think it's not dangerous to them. these flavors are clearly marketed to children.
in the packaging, they do them in juice boxes with an actual straw to replicate a juice box. they are on snapchat and instagram. ,here was one advertisement they had an advertisement on instagram of their device that looks like a usb port and is said no mom, it's a usb port. they did it to appear to -- appeal to children. illegaloral, wrong, and in north carolina. juul has taken most of its physical products off the shelf you can only get them online. is that enough? >> no. you can still buy it meant in stores. --mint --juul mango is the
flavor. kids can get the hands on it as long as it's manufactured and sold. you cannot buy a mango flavored cigarette. that is what these e-cigarette manufacturers need to do. sell only mint and tobacco flavor. emily: is the fda doing enough? >> no. they have the right intention. they care about this. the commissioner has declared it an epidemic. they have the right orientation but they need to do more. they need to band these flavors. they need to get preapproval on these products before they can hit the shelves. ony need to set a standard how much nicotine -- one of the companies i sued yesterday, the amount of nicotine in their pod is twice what ajuul pod is.
the amount of nicotine is outrageous. the teenage brain is highly susceptible to addiction. the fda should ban these products when they are not targeted to adults. it, iadult wants to buy have no problem. that is their right and if it helps them get off cigarettes that's fine. what is happening is, the children are the ones buying these. you expect other attorneys general to join in on your suits? be surprised. i have heard from a number of attorneys general who are concerned. emily: you have philip morris in talks to reunite with austria juul.has a huge stake in
what is your take on that? about what corporate form any of these conglomerates take than i do about the business practices that are engaged. is for companies to stop designing their products, packaging their products, marketing their products and is selling their products to children. to clarify, the eight additional companies that you ,ave sued in addition to juul how did you choose them specifically? >> we did some research and had some people do purchases. we thought they were extremely bad actors. that's what we allege it our complaint. my objective is to try to protect young people in north carolina from these products that are extremely harmful and addictive. these were bad actors in my view. that was north carolina attorney general speaking with
me earlier. for more on concerns about bathing products i want to bring our professor and guests. he published an early report this month which finds vaping may not be safer than smoking cigarettes. reporter guessed from washington, d.c. there's a lot of competing dynamics here. you have lawsuits on the attorney general of north carolina. corporate potential deals being made in big tobacco and e-cigarette space. new science coming out on this topic weekly. what do you expect to happen with this lawsuit? how impact will could it be? interesting that the
attorney general filed this lawsuit while at the same time the fda is looking at a lot of these issues that he has raised particularly the flavor that is out there. that kids are able to get hold of in stores even though that is illegal. one is going to happen is way or another, it seems these flavors will be restricted whether that comes from attorneys general filing lawsuits or from the fda actions. that should be becoming final pretty soon. they had proposed limiting tovored e-cigarette products just certain stores where there was a separate barrier for adults to go by them. that would not be a regular convenience store or gas store where they are now. it seems like the outcome one way or another will be that flavors will be restricted in
some way. professor, let's talk about the science of your study which is fascinating. it all boils to do one question. our e-cigarettes safer than regular cigarettes or not? the perspective of the lungs, they are not. believe they you are not safer? >> we have been studying protease which is like molecular scissors. when you get disease, they go up. when you get emphysema, there is a high level of protease in the long. that causes the lung disease. harm. biomarker of we found that they were up at the same level in smokers as in vapors. which means if they keep vaping over 20 years or 30 years they
will get copd the same as smokers. elevated levels protease enzymes have been found in those vaping and smoking. if you had to choose between one, which would you choose? ae e-cigarettes at all healthier or safer alternative? >> from what we have looked at in the lung, no. emily: what about the long-term impacts? vaping has been around in a limited form for some time. don't we need more time to draw an official conclusion? on one regard that is true. we need to represent this study -- reproduce the study on a bigger sample. that is going to happen starting next year. need to replicate. to know whether vaping causes
the same disease as smoking, we have to wait 30 years. wouldt's kids of vaping i rather not take the risk. there is a very strong association between lung disease and protease levels. how are the fda and e-cigarette companies reacting to the study? >> this just came out last week so i have not talked to any e-cigarette companies or the fda. the nih is aware of it. as far as you understand it, how is the industry reacting? is doing that juul there on studies on this. and they have to submit their own study to the fda by next year. they are looking at a lot of this because they have to weigh
the risks and the benefit and prove to the fda that these products are more beneficial than they are harmful. i think we will see some of their research which i imagine will attempt to contradict smooth is coming out over several months. and be included in what they sent to the fda. emily: more to come. thank you so much for joining us. fitbit is pushing beyond hardware and into services. the cofounder and ceo tells us how the news description model will help the company take on a petition from apple and amazon. this is bloomberg. ♪
emily: the u.s. justice forrtment is opposing a bid internet cable between u.s. and hong kong. it is intended to bring faster connections for investors on both sides of the pacific. so far, construction has been conducted under a tech desk every permit. fitbit has struggled to beat in againstt watch market companies like apple. shares are down. now the company is shifting its business model with a new subscription service. week hosts talk to the
ceo of fitbit about this push. >> we have a lot of exciting announcements today. it is all in support of our companies mission which is to and toeryone healthier make this more accessible. we are transforming our company from being a purely device company to more of a services and device company with more predictable recurring revenue streams. premium is an important step in the transformation. talked about an all-in-one copperheads of health service that takes data from the rest and turns it into actionable and personalized guidance that helps you get more active, even better, and sleep at her. programs, insights, content, motivation and coaching , a health report that you can
take to your doctor. it's no longer about how many steps you take. >> is what's beyond the metrics and data. how do we coach you and guide you to the next step? that's incredibly important. >> tell us more about that. clearly this is a response to the market. what did you specifically see and hear from your previous product that got you to this? >> it's not so much from the market but from our customer. we collect a lot of data from our users. we also see how well they are .oing very a step to getting our users healthier. people need to understand what to do with the data we give them.
company hasdoorbell partnered with forces -- emergency forces giving them access to the cameras. the partnerships allowed police to request a video recordings within a certain time in geographic location while ring doorbell gives users the option to deny requests. joining us from seattle to discuss this is our reporter who covers amazon.
how will this program work? >> it works through an app that ring doorbell released last year called neighbors. footage,hare your report interesting stuff for suspicious people. if the police come knocking you can share your footage with them. >> it sounds like it could become a little big brother. it will of protections are there? >> ring says all of this is opt in. you are not streaming live to your neighbors by default. you are not hitting footage over to the police. ring doorbell says they are not going to lower their standards for turning over information to the police. they are saying that at least
for now everything is opt in with police. how does this fit into amazon's racial recognition technology? >> this was in the news recently when ring doorbell was granted a patent or something that looked like applying facial recognition software on the backend to identify who is at the door in a database. that is not in place now and there is no formal relationship between ring and the amazon service. there are civil liberties groups who have been critical of the rollout of smart doorbell cameras. they are looking at patent applications. suggesting that this is were this could go in the future. emily: how the police departments used ring doorbell so far? i mentioned it has been useful in certain cases.
>> yes there are a wide range of applications. catching porch pirates who are stealing packages to a fire across the street or a violent episode on the sidewalk, having extra eyes on the street. is, what is the community weigh in on this? a lot of these deals were negotiated in secret and it was the work of journalists and civil liberties groups to say what kind of relationship is there between ring doorbell and police departments in my hometown? gottenlastly, ring has criticism for not just being a doorbell company. what are their real ambitions? amazon orr marketing, ring wants to sell safety. they said we are a safety
.ompany that's when they have released this neighbors app. to try to fulfill that. for amazon, it is just another stake in the ground in their smart home plate. they want to be in your front doorbell, running your wi-fi after a recent acquisition. they want to be everywhere in the home. emily: thank you so much. for this edition of the bloomberg technology. our conversation with the ceo of uber tomorrow at 6:00 p.m.. we are live streaming on twitter. check us out at technology. this is bloomberg. ♪
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>> welcome to daybreak australia. i'm paul allen. >> i'm shery ahn. we are counting down to the major market open. >> here are the top stories we are covering. moving markets, steven mnuchin says ultralong bonds are a possibility. there are no plans to intervene on the dollar. the brexit drama turns a new page.