'Bloomberg Technology' Full Show (11/11/2021)

'Bloomberg Technology' Full Show (11/11/2021)

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From the heart of where innovation money and power collide. In Silicon Valley and beyond. This is Bloomberg Technology with Emily Chang. I'm Emily Chang in San Francisco and this is Bloomberg Technology coming up in the next hour. Elon Musk unloads five billion dollars worth of Tesla shares as a billionaire. Tax debate continues to rev up and he plans to sell them long before his Twitter fall apparently. We'll talk about what that really means.

Plus bubble shares falling to their lowest level since going public after a drop in subscribers at its European dating app do. We'll talk to CEO when you Wolf heard about the future of dating in a post Covid world. And Ali Baba has a record breaking singles day. The shopping festival raking in more than eighty four billion dollars in sales. How this impacts the Chinese tech giant after a year of increased scrutiny from Beijing. We will get to all of that in a moment. But first it's going to look at the markets. U.S. stocks pulling back from rebounds. Tesla fluctuating on the back of Musk's share sales and Disney slumping on the back of earnings. Are Sonali Basak has the full

picture and only take it away. Hi Emily. You do have the S&P jumping back a little higher. Today wasn't a big rise but it is after two days of decline. And guess what. More than that you have the Nasdaq rising higher than the S&P and the Russell 2000 rising even higher than that. So you do have a pretty broad based rise here. You had volatility lessening on the day but obviously that volatility has not been enough to deter some of the risk taking we've seen. We have a Galaxy Crypto Index

Bloomberg Quicktake preparedness a little bit lower today. But as we know it was very recently we had crypto hitting a record high. When we look at that Russell 2000 like I was talking about 3000 members that we were talking about we have a broad based rally here. Finally a big being caught in small cap stocks. People worried about valuation among the bigger companies a

little bit. You have companies more of them moving above their moving average their 200 day moving average. And if you take a look as well let's look at the tech subsectors here because we do have as well of a rally in many of those sectors though not as broad based as you are seeing over. And the Russell 2000 the smaller stocks what I was talking about. You have the Sox up 1 4 9 percent. The biotech index like I was saying down a little bit on the day. The Golden Dragon China Index up 5 percent. That's the biggest of the group over there. And electric vehicle makers up one point six percent though that is nothing when you look over at something like revision that was up 20 percent for a second day. All and Ali thank you so much for the roundup. Meantime Elon Musk sparking heated debate over the weekend when he asked his Twitter followers whether he should shell a big chunk of his Tesla stake come Wednesday. He unloads five billion dollars worth of Tesla shares but it turns out he may have

planned that sale months ago. Let's bring in our Ed Ludlow. So at the forum for comes in and we are digging through it. You are digging through it trying to do the math. What exactly did he sell and why. So the headline is five billion dollars worth of shares four and a half million over the course shares over the course of three days. But they're not all the same. So about a billion dollars worth were tied to tax obligations that Elon Musk had on options. You know in 2012 he was granted options as part of his compensation. Those expire next August. So he exercised the options and he owe tax on that. So what did he do. He sold enough shares nine hundred thirty four thousand to meet those tax obligations. Now

that leaves three point nine million shares and about four billion dollars of other stock. There was nothing in the filings about whether he planned this in September like he did with the options 1. There was nothing about it being tied to tax obligations. He just sold the remainder a stock. OK. So at least some of this share sale was planned. Some of it. Right. Then what does that Twitter poll actually mean. Is it misleading. Well when he tweeted that he knew that he had arranged this payment schedule based on exercising those options and selling stock to meets the tax obligations he followed that on September the 14th. So that's months. We have no idea about the remainder. Almost four billion dollars worth of stock that he sold Tuesday Wednesday at a really elevated price of a say. The shares had an incredible run up of

late although it dropped off following that tweet. We don't know this. And of course he could still sell 10 percent of his stake. Twitter seems to want him to. Right. If you're if you're an investor in Tesla how often is Elon Musk tweeted in a way that moves the stock. I think you know we have great examples of that. Right. You go back to the tweet August 2018 funding sick kid to eat. Incredible. And the shares jump 11 percent. He is then reprimanded by the S.E.C. over that. You know even as recently as November 1st when the Hertz chaos was going on there's this deal. Bloomberg reports a deal with Hertz. Hertz says they've received Teslas. And yet he tweets no contract with Hertz. The stock moves. You know he's also tweeted that he

thinks Tesla stock is too high. Right. Value too high. Right. And it's. Unusual behavior for a CEO. But remember that all this comes back to is not about Tesla's valuation. According to the Twitter poll it was about DAX. It's also about this debate right. That billionaires aren't paying enough right or using tax havens or somehow avoiding taxes. Is he trying to buffer his image here. Or does he actually want to relax. He's thinking about this. You know I was at code conference where this was put to him and he said well I do pay tax. You know there's a ProPublica report that he didn't pay tax. Right. He says that he pays an effective rate of 53 percent tax but he doesn't take a salary from Tesla or Space X. The only way he can pay tax is

through his stock and options. And so he says hold on you guys want me to pay tax. The only way I can do that is to sell the stock. All right. Well we'll keep watching his Twitter as we do. Yeah so much fun. I'd love to. Thank you. Meantime Disney is trying to ramp up excitement for its Disney plus day. Coming up this Friday with some new promotions for subscribers. This after the streaming service out of a disappointing 2 million subs a far cry from last quarter when nearly 13 million users signed up. This while rival Netflix is expecting almost double digits next

quarter thanks to original hits like Squid Game. For more I'm joined by Rich Greenfield partner at Light Said Venture. So Rich what are these new numbers tell you. Are they perhaps maxed out on new subscribers especially in the United States. You know Emily it's just sort of sad right. I mean at the end of the day Disney's got some of the world's best content and they have all the ability to effectively win if they want to win. But like many legacy media companies they're dealing with the balance and

they're conflicted. Do we support our legacy TV businesses. Do we support them. Movie theater business that we've been in for years and decades I should say. You know if Disney wanted to have Xiang Shi internals all of these movies West Side Story only available on Disney plus they'd have an incredible slate of content in Q4 for Disney plus. Instead you turn on Disney plus top title is The Simpsons Mickey Mouse Club Bluey Marijuana. Look it's just honestly it's just embarrassing how bad the kind

of headline content. There's nothing for anyone over the age of 10 in terms of fresh content. And they keep saying it's coming. It's coming. They have an incredible array of content for adults. I mean The Bachelor The Bachelorette Dancing with the Stars all of this content could be Disney plus exclusives. And they could have a really comprehensive service that could be driving subscribers at far higher prices. Instead they're stuck in their silos and they're trying to balance all of their legacy businesses with Disney plus and balancing this whole dabbling balancing they're losing. They're just not winning the way they

could. They have all of the resources. And I think it's just disappointing that shaping is sort of waiting and waiting versus using the resources he has at his disposal right now to accelerate growth. Meantime Rich I'm just noticing that you're wearing a squid game t shirt which of course is there. We know this big original. You told me when Disney Plus debuted that it would never be as big as Netflix. Do you still believe that. You know when you have a service. First of all I should say the

one thing we didn't count on when Disney plus launched is that they give it away to 40 plus million homes in Asia. So you know when you say as big as the subscriber numbers it's roughly half the subscriber base. But it's very misleading because you know basically more than a third of that's almost a third of that sub base. They're effectively giving away in Asia as part of Hot Star. But if you look at revenues I think that's probably the better way of thinking about your question. These things aren't even close. I mean if you look at some recent comScore data just to give you a sense of viewership unconnected to these in the U.S. Netflix is 26 percent of time spent. YouTube is twenty one. Disney plus 4 percent. And it's been declining like there just

is not that much to watch. And that's why people are paying our crew six dollars or less in the US for dollars globally. It's a very very low cost service with very little usage. That's the disturbing thing is that they could drive it you know. No one sits. I think the best way of thinking about this Emily Coco Melon is a top 10 title. It's for Preschool Kids Moonbuggy Entertainment recently acquired by Kevin Marin Blackstone and Tom Stags. That show sits on Netflix right next to squid game.

Squid game obviously for adults not for young kids but preschool and adult content sits right next to each other. Yet Disney thinks they have to have different services for each type of content. You just had a bloody fit. You know you're the bloody figure on it. Just it just funny. Like no one is complaining no parent. You don't see an uproar of parents saying oh my God.

Kimberly Squid been sitting next to Coco Melon. Disney needs to realize he needs to put all of its content into one place. Forget about movie theaters forget about broadcast TV forget about cable networks put all of their content into one place and win. That's and I unfortunately going back to your question though. Do I think they will be as big as Netflix. No because they have a management team that is unwilling to do what is necessary to win. Speaking of you don't hold back. Rich which is why we love having you on the show. And as I understand it you've been disinvited from Disney events. You haven't been able to ask a question on a call for a few years. Right. I mean what's this.

Give us a status update on your relationship with Disney. You know look they at least they invite us to listen to their conference calls and they tell us when things are happening. But you know look I thought with shaping taking over I was hopeful that things would change because you know anger and Xenia their head of communications certainly didn't like us. I don't know. The entire management team is turned over. I'm certainly hopeful. I would love to have the conversation. We have lots of

big ideas that we think could be helpful to Disney. I think in terms of what would make the stock go up I mean we've been very vocal that cheaper team should be spinning off ESPN and ABC. Those are businesses that have no synergy with the rest of Disney and would create substantial value in the shareholders. We talked to do not want Disney owning ESPN and ABC. These are

not businesses going in the right direction. So look I would love to I would love to break bread with Bob J. Pick and his management team. We're still waiting. We would love that any time we would be there. All right Will. We'll see if they get that message. Like Chad's Rich Greenfield. Keep us posted. Thanks for having me Emily. All right. Coming up Bumble shares stumbling after a less than stellar third quarter results but analysts are betting next quarter gets better. I'll talk next with the CEO of Bumble Whitney Wolfe. Heard about where she sees the dating world after

Covid and even in the metaverse beyond. This is Bloomberg. With life getting ever closer to well some sort of normal. So is the world of dating Bumble reporting its third quarter earnings and while it missed Wall Street estimates paid users for the dating app that allows women to make the first move did increase. What is the future of post pandemic dating for those looking for love. I'm joined now by CEO and founder of Bumble Whitney Will Hurd. Whitney always good to have you here on the show. Look the stock dropped almost 20 percent today. There's

concern about the MIS in paid subscribers and also what's happening with Baidu a decline in users there. What is your message to investors today. Yes. So great to be here. Thanks for having me. Let's just lay the groundwork for a quick second before we get into the paid user question. So we are always focused on the fundamentals and we had an excellent Q3. We expect revenue to accelerate year over year which is why we raised our guidance for Q4 and the full year and bumble app is doing exceptionally well. So let's talk about the paid users for a moment. Our strategy has been to create value added experiences that our users want to pay for that adds value to their experience. So in the last several quarters this has

focused on creating premium experiences through our second tier on Bumble Amber Do. So this resulted in higher are people who average revenue per paying user and fast revenue growth. But it's not a strategy that is focused at the moment on selling low price point consumable offerings to everyone. Thus it results in lower subscription numbers. But that said we are very confident in our underlying business. We do not have an issue. Our users continue to grow. They are growing at a very rapid pace and we have more and more opportunities to generate higher numbers of payers. This is going to be strengthened through new products that we have on the roadmap for 2022. And in addition to just our normal business practices. So that's the way we are thinking

about payors. I think there's a bit of confusion in the market which is you know par for the course. And then as we turn to you I guess on the Baidu point I think it's really important to note that we implemented some temporary changes in our billing and payment systems on Android that by design eliminated third party payment options just very temporarily. So this also had the effect of improving our PPO but not growing that number of payers. But we've since reversed that given some changes in the app store environment and we are rebounding from this as well. So look the U.S. is fairly open now. There are still Covid challenges in Europe. What does the future of dating in a mid to post Covid world look like. What are the trends that you're seeing. So you know the trends are really fascinating throughout Covid

and currently Bumble continues to grow rapidly around the world irrespective of the Covid environment. We have strong re-engagement in the US very strong new user growth in markets as wide ranging as Mexico Brazil India Indonesia Germany France and so on. So when you think about the way Bumble has been impacted by Covid it just really reinforces the strength of our brand our product and the customer base that relies on us for connection and for relationships as we turn to Baidu. I think

it's really important to take a note take a moment to notice that that customer base is inherently different right. It's a different market. It's a different offering. And because of the countries that we're so strong and with the do they have just inadvertently been impacted by Covid in a more serious way. And so when you think about Baidu more generally it actually continues to be a very very highly engaged dating app. And it's the second most downloaded app globally. It's just seeing slight you know stronger headwinds due to Covid. But as we look to the future as these markets reopen

what's fascinating is we remain a staple in people's dating lives. We remain the go to for creating relationships. People now have no time to sit around and waste when they want to find someone special or find someone to share in special moments. They turned to us to take control over their dating lives especially women. And we are seeing this across the globe. You talked a few times on the call about the block chain and the metaverse. How do you think these mega trends could impact the future of dating. What does dating in the metaverse look like. Is that an opportunity. It's absolutely an opportunity. You know Web three is a huge opportunity for us. We are a business rooted in connection and

building community. And as you know we are slowly optimizing and rolling out the new refreshed version of our platonic connection platform BSF which is already. Remarkable crossover opportunities between the dating and the platonic but it's also just proving the strength of the demand for platonic relationships. And when you think about Web three

how we really turn our customer into members with real ownership over the product and through their experience to have these creator channels and ways to interact in in a deeper way. You know the pre match experience could turn even more digital. And you saw us roll this out. Very generally speaking with video. But the metaverse is is a real opportunity in the future. And we expect to be the front runners as it comes to dating and building community more broadly because that's just a natural extension of who we are as a pro as a product and as a brand. OK. Last quick questions. We've got just about 30 seconds left but it is Singles Day which is obviously huge in China. And I didn't realize it's becoming a lot more popular in the United

States. What do you make of that. Are you seeing any change in activity on the app. So every day is singles day at our company but we will have to analyze how that impacted us today. But I will say that you know every single day is an opportunity for singles to come and unite and find whatever they're looking for. That's what we're here for. And to give them control and power over a healthy and equitable relationships. All right. Whitney Wolfe Hurd CEO of Bumble. Always good to have you here. Thanks for giving us a glimpse of the dating world of the future. Great to see you. Thanks. Good to see you. Coming up as COP 26 talks come to an end in Glasgow. We're going to find out what is still unresolved including crucial negotiations on international

carbon markets. More on that next. And as we head to break Spotify finishing the day up to an app for the streaming service expanding to audio books with the acquisition of Find a Way. The purchase marks Spotify as ambition to grow beyond a music app and become the default service for all kinds of audio. This is Bloomberg. The fight against climate change requires certain things of the way within the way companies combat businesses and the way governments design policies in every sector of the economy reducing emissions. Tom said of course he was looking to cut

just rates and accelerate pollution cuts carbon markets. The idea is this conscious for cutting carbon is expensive and difficult. Can buy credits representing emission reductions from nations that hold the lower pollution markets. Companies can invest in products that lower greenhouse gases in other countries too. Such products for example replacing dirty sources of energy with renewables would generate offsets which then can be traded further. Demand is growing for offsets as corporations and governments spend billions of dollars to meet their nets. You don't targets. More credits have changed hands in the first eight months of this year than in 2020 according to the new energy finance where nations and some companies have relied on carbon markets for quite some time already. The quality of all since that is that concern is that solve them. To

this hot air or failed to respect human rights. The person that paved the way for a new carbon offset programs in Article 6 derogation of some pledges of credits will be overseen by the United Nations. A well-designed market spur up to one two young daughters of investment in developing nations and encourage low carbon innovation. But even the rules are too lax. It would

Amelie give it across to companies and governments to pollute more than they should. That was Bloomberg's Eva Krakowski reporting on the COP 26 talks wrapping up in Glasgow. Now Robin Hood is the target of a class action lawsuit in New York federal court over allegedly failing to protect millions of current and former customers confidential information. Earlier this month the company announced a hacker quote socially engineered a customer support employee by phone

and obtained access to certain customer support systems. The complaint filed against Robin Hood says the data breach could have been avoided through basic security measures authentication and training. Coming up the future fintech. We're going to take a look at. So five third quarter results and we'll see whether or not they think it paid off to be the only real tail platform to offer access to revisions IPO. That's next. This is Bloomberg.

People. Welcome back to Bloomberg Technology Emily Chang in San Francisco. Let's get more on the markets with Bloomberg's ad Ludlow ad you were all over revisions. Big debut Wednesday of course you had an exclusive interview with the CEO. How was day two. You know the expression a picture can tell will say a thousand words. Two

days of trading up almost 60 percent from where the stock opened. Way way above the listing price of seventy eight dollars a share with closing at one hundred twenty two dollars. Ninety nine cents a share on Thursday. And now we're turning to questions about valuation. Revision has a valuation as of Thursday is close above one hundred billion dollars. This is a company which has delivered fewer than 200 batch redecorate pickups most of those to employees. That is its market capitalization. There's already intense debate around Tesla's valuation above a trillion dollars and delivering probably less

than a million vehicles this year. And this is all the intense debate that's going on on Twitter among Wall Street analysts among investors sitting on the sideline and asking is this a company we should be buying into. This is a growth company. This is a bet on its future. And the markets is moving into. Let's see where it sits. Among the pantheon of all time. US IPO is astonishing really. That and you've covered some of these amazing companies over the years. Facebook was a huge IPO. And yet look how close we are in terms of the money raised. So that's what discussion is here is raising 12 billion dollars for

a company that's delivered hardly any vehicles to help it justify that valuation in the long run. That's the debate. How quickly can it scale production and bring meaningful sales. And remember Tesla very quickly. I think that's when we'll Tesla record a profit. How long did we ask that question. How long are we going to ask that question. We've really an astonishing two

days of debut trading. All right Ed thank you for that roundup. Meantime strong third quarter results for the online personal finance company so far. Shares in the fintech firms soaring after its latest earnings report beat estimates. How did they manage it. And what's next for them. Let's ask so CEO Anthony Noto who joins us now. Anthony I want to start with Reva because you actually were the only trading platform to offer really in shares to retail investors. Just how big was demand. There was a lot of demand is obviously a very attractive IPO for investors that are looking to invest in innovation and also invest in a new platform for vehicles. Obviously on the on the Eevee platform we had about 300 million dollars of demand for our member base for the IPO and we were able to deliver at least one share to everyone that confirm the order and had funding.

But obviously we're well oversubscribed like the rest of the deal. So not everyone got 100 percent of their confirmed orders. But I went to get it. They're well oversubscribed. Can you tell us how oversubscribed. The demand was very strong. Well in excess of the supply that we that we had. I can't get into the details beyond that. Do you wish you could've gotten more. You got point four percent. And how much did this pay off for. So five.

Well the way we think about it is we wanted to deliver value a value proposition for our members. We're we're one stop shop across all the major financial products that someone needs in their lives. Build a lifetime relationship. Investing is one of those areas and having different selection within investing is important. We were the only place that offers single stocks without commission fractional shares ETF. Robo advisory accounts cryptocurrency and IPO is. And that's another piece of differentiated selection. So yes we would love to have more supply. We clearly have a demand for it and we want to continue

to bring the best selection and Bush NIKKEI selection to our members so they can get their money right. We saw Coinbase and Robin Hood report disappointing results for at least as far as investors were concerned. Your stock on the other hand soaring on the back of your report. What do you think is driving that optimism. Yeah I think a few things stick out because we are

building this one stop shop for financial services products on your mobile device. We have businesses that benefit the low interest rate environment and then other businesses that benefit in a high interest rate environment. We all of us also have businesses that benefit from stay at home as well as reopening. So we've been able to navigate through the volatile environment of going through those different cycles over the last two years. We had a record quarter of revenue which exceeded Q2 which was a record in itself that was driven by strong performance across all three of our diverse businesses. And so that diversity that we deliver to our consumers translates into more diverse revenue base. And there are companies that are missing because they're

only in brokerage and they're only lending or they're only in categories that benefited from stay at home because we are a one stop shop. We have that breadth of businesses and three that can offset each other in good times in one area versus versus the next. So continuity and consistency is really important. And we're proud of the fact that we deliver not just Q3 but we still we still see strong momentum into Q4 and give guidance for accelerating revenue growth to forty nine point fifty five percent year over year. Talk to us about the future of crypto on the platform. How many more crypto currencies do you want to add and can you share what you're considering. Yeah we started the year with five different coins on the platform. We've now expanded to over 30. We'll continue to add selection and we have a very specific criteria of what qualifies to be at NASA on the

platform. We're also looking at other things beyond the assets that I mentioned and alternative asset classes down the road. We want to give mainstream investors the access to investing vehicles that are similar to high net worth individuals. And the ability to deliver an IPO at IPO prices is quite unique. Here's an opportunity to do that and other asset classes as well. All right. So if I see you Anthony Noto always good to have you here. And it's Veterans Day. I know you're a veteran so thank

you for your service and sharing time with us today. Thank you. I'm with Ticker. All right. Some other news we are following. Uber is raising its base fares in London by 10 percent to attract more drivers. Customers have complained on social media about longer wait times cancellations and higher fares especially during peak hours. Uber says it needs about 20000

more drivers in London to help get service to normal. And shares of beyond meat plunging the most in a year the maker of plant based meats releasing a disappointing sales projection for the next quarter. That sparked concern that the company's fast growth in recent years starting to taper off. Coming up the online education platform master class has announced a range of new offerings ahead of the holidays. We're catching up with master class CEO David J. Next. This is Bloomberg. California drone startup Zip Line will begin delivering medicine blood and other supplies to homes in Salt Lake City Utah. The

companies fixed wing drones have been transporting medical supplies to rural clinics in Rwanda and Ghana since 2016. Zip Line says it expects to make its first deliveries in the spring of twenty twenty two and reach hundreds per day within four years of launching that service. Meantime from the kitchen to the garden to the stage masterclass has an offering for just about anyone looking to develop new talents. A company that benefited from pandemic induced

shutdowns and a transition to digital media now hoping to keep that momentum going with a slew of new offerings. They've got updated instructors and class announcement and they're now working with companies. With me now to discuss these big announcements master class CEO David J. David great to have you back here on the show. You've got new you've got new classes on there are coming from Bill and Hillary Clinton George W. and Laura Bush Mariah Carey Amanda Gorman Bill Nye Ringo Starr. You can pick one class. Which one do you spring for. Bill Nye. Bill Nye. I've always wanted to do much better. I always wish I

was much better strong and much stronger at science. And he is an amazing teacher. So if I if I may choose one of those I like all I like every single one of them. You're asking you're always asking me to pick a kid. But if I didn't choose one to take right now it would be Bill Nye. All right. Meantime you're partnering with companies like Microsoft and Deloitte to offer masterclass at work. How much new business do you expect as a result of this. That has been very extreme extremely fast growing. We have seen 0 0 for the past year as as as companies try to find perks and training of their teams that they just want masterclass. So we in the past year have signed deals with EV with folks like with folk with with folks like Square and

Deloitte. And though that over for the next five years will become a main stream for us. Demand been like as we come out of Covid. We've got less time stuck at home for personal enrichment. Any concerns about a slowdown. I am not concerned. I think the demand for people to want to learn to want to grow is just it is

just is just increasing. Also we are about to go into the hop in which we are about to go into the hall into the hall into the holidays. We are a gift that is not stuck in any port that is not delayed. So we you know I am thrilled and and excited and excited for the new year. And what about demand ahead of the holidays. You know I know that masterclass has often meant a popular gifting option. It has always been one I think this end of this year we hate. We

have a class for everyone. It is a great gift. And it's also one that despite all of the slowdowns in the supply chains it is one that you can buy and get. Are you thinking at all about live events or events in virtual reality. Or or even the metaverse is not on your radar. Those are things that we are talking about. It's not. It is not. It is not going to be something in the short term. But imagine how great it would. It could it could be to learn from Steph Curry on how to shoot a basketball and you use your phone to look in a

car or IT or in VR to see where to place your feet. So those are things that we are discussing but it's not going to be anything in the short term. Now it's not inexpensive. One hundred eighty dollars for the base subscription. You go up to 276 something more for something more premium. Do you foresee a time when that cost will come down. You know the cost. If you average out on a month on a per month basis it starts about at about 15 bucks a month which for access

150 class 150 classes from the very best in the world I think is an amazing deal. But one of the things that I care a lot about is how to give people that can't afford it access to it. So in the next year we are going to give access to a million people that otherwise could not afford it. All right. Now let's look. Look out to next year. How do you see growth keeping up picking up especially as you know we're coming off our couches we're going out into the world. We have so many different opportunities to do things outside again. That is very true but I think the other trend that's also

happening is Pew. People are thinking about changing jobs and changing and changing things that they want to actually do. And what we provide is lots of classes in lots of new areas for them to explore and learn and gain those skills. So I think the macro trends of people wanting to learn people few to feel that they have to learn in order to get the jobs that they want is going to be great for us. And what is the one who's at the top of your list for a wish list. Recruits who. I mean I have a long list but OK the top ones I would love the Obamas to come and teach. If Warren Buffett would come and teach those would be some of my top. Those would probably in my top five. All right. We'll try to get that message to them. Thank you. I was a CEO of Master Class. Great to have you back here on this show. Thanks for stopping by.

All right. Coming up Ali Baba shopping extravaganza Singles Day posting a record eighty four and a half billion dollars in sales. We're looking at what's different this year and how the competition stacks up. That's next. This is Bloomberg. Alibaba Singles Day is the world's biggest shopping spree eclipsing other events like Cyber Monday and Black Friday. One of the biggest recent drivers of that growth has been live streaming influencers some of whom have built massive followings and can move billions of dollars worth of goods in a single broadcast. Here's a look at the growth and the future of AECOM

live streams. Meets China's most popular retail influencers via an Austin Li Joshy petition in financial instruments. These two have such big followings that Li 1 sold 15000 units of lipstick and just five minutes together they racked up sales last year of eight point two billion dollars. That's made via a multi-millionaire at age 36 with one of her broadcasts pulling in a record high audience of 37 million people. That's more than

a Game of Thrones finale or the Oscars across mainland China. Online streams raked in revenue of about one hundred forty nine billion last year. That's just under 1 trillion yuan. That represented about 10 percent of China's annual online retail sales of just under 10 trillion yuan in 2020. Astronomical growth really for an industry that Alibaba pioneered as a marketing tool just five years ago. A survey last year found that almost 40 percent of all Chinese Internet users

had watched e-commerce live streams. Twenty eight thousand companies now operate as live streaming agencies growing so successful in some cases that several are said to be considering going public. But all this capital flowing into these influencer incubators has drawn increased scrutiny from Beijing. In April regulators set new rules controlling the types of goods and services sold and how they're marketed towards viewers fail to crack down on fraud. With several influencers and agencies accused of selling fake products and inflating sales figures earning them fines and bans from using streaming platforms. But the biggest impact could come from regulations

linked to Beijing's Common Prosperity Drive. As part of the initiative to reshape Chinese society authorities have cracked down on the culture of celebrity putting at risk. One of the key pillars of the industry success. For now it's business as usual. But Bloomberg Intelligence says that any potential fallout can't be quantified until regulations are clarified.

Singles Day posting a record eighty four and half billion dollars in sales and could serve as an indication about what holiday shopping looks like this season globally. Joining us from LA is chief North Asia correspondent Stephen Engle Steve HENN. What's your big takeaway. That's a big number. It is a big number. And there was a lot of uncertainty this year because of the regulatory scrutiny obviously that Alibaba has been under for the last year. And you know Jack Ma is a showman but he has been off the stage out of the public eye for the better part of this year. And we really didn't know yet what impact that would have. Because you and I have covered Singles Day together. I think about six years ago we were in Beijing together covering it. It is quite a show you know Taylor Swift and all the celebrity. This year they they took the high gloss

out a little bit and went more low key. They did not necessarily want to have that big electronic telethon like tally of gross merchandise value racking up every second billions and billions and billions of dollars. And oh look Jack Ma is getting even more rich more influential more powerful. So they kind of did away with that and focused more on promoting some philanthropic endeavors and aid to the rural and the poor. And there's going to be actually a lot of costs associated with that according to Bloomberg Intelligence. But less glitz glitz and glamour. No offense to Benedict Cumberbatch who is a celebrity there this year. But you know he's no Daniel Craig. Right. So you know they've toned it down a little bit. No Nicole Kidman no Daniel

Craig no Taylor Swift. But again a big shopping. No it's a big shot in the arm for Ali Baba. Big shot in the arm for confidence in the consumer in China about the role of influencers. You know even if Benedict Cumberbatch isn't quite Daniel Craig and you know influencers in the future of e-commerce where it seems to be even more advanced in China than in other parts of the world. Yeah I mean Kailey Leinz key opinion leaders are critical in Chinese Internet and now as we just saw in that package a shocking product. But again it comes at a time of common prosperity. And you know this this notion of celebrity has been kind of knocked down a

peg a little bit by some some verbiage coming from Beijing authorities. So it's a delicate balance for sure. But as we can see when you get a key opinion leader a celebrity shocking tooth paste or lip gloss or whatever it pushes product not that we didn't need to have more you know incentive to buy products. Because look at

that big a record number on Singles Day. But again it adds to the. The sales numbers. Meantime Chinese tech stocks killing it right now. Didi as well relaunching its apps. Curious what you make of this given all of the scrutiny from Beijing on you know not just Alibaba but Deeds and so many Chinese tech companies. Look there's been a confluence of headwinds regulatory and economic and due to the corona virus in the Chinese economy and all coming kind of at once. So there's been regulatory crackdowns not only on big tech but on insurance. Obviously

fintech obviously on gaming obviously on property at a time when Xi Jinping as well just solidified his power base his mandate at the plenum. This was a highly charged political year in China. And he was solidifying his grip on that power and his control of what he thought was an out of control economy. In certain areas monopolistic behavior on the part of Alibaba some fines against them. Didi is an interesting one as well because authorities were absolutely furious when he kind of ignored recommendations if you want to call it that from authorities and went ahead with that IPO in June in New York and did not necessarily have all the cyber security reviews necessary. They had their apps taken

down from you know China. And there's a new report. And that's why now that the plenum is over and the relaxation in property relaxation a little bit here and there there's a report from Reuters at least saying that Didi might be getting their apps back up online in China by the end of the year. They could be facing a big fine like Alibaba did. But again getting those apps back up on line is why there's a big boost to Didi sentiment right now. ISE Stephen Engle joining us on this very early morning in Hong Kong. Stephen always good to have you. Thank you for joining us.

And that does it for this edition of Bloomberg Technology. Make sure you tune in tomorrow when we're gonna be joined by Open Doors CFO Carrie Wheeler also the CEO of Amplitude and Spencer Skates as well as the CEO of Air Table. I'm Emily Chang in San Francisco. This is Bloomberg.

2021-11-12 12:56

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