>> FROM THE HEART OF WHERE INNOVATION, MONEY AND POWER COLLIDE IN SILICON VALLEY AND BEYOND, THIS IS "BLOOMBERG TECHNOLOGY" WITH CAROLINE HYDE AND ED LUDLOW. ♪ >> I AM CAROLINE HYDE AT BLOOMBERG WORLD HEADQUARTERS IN NEW YORK. >> AND I AM ED LUDLOW IN SAN FRANCISCO. >> COMING UP, A NEW BIDDER IMAGINES FOR TIKTOK. WE SIT DOWN WITH PROJECT LIBERTY FUND ARE FRANK MCCOURT. >> AND WE BRING YOU THE TAKEAWAYS FROM GOOGLE'S IPO DEVELOPERS CONFERENCE.
>> AND OPENAI'S CHIEF SCIENTIST WHO PLAYED A KEY WILL IN THE SAM ALTMAN'S OUSTER IS DEPARTING, WE WILL DISCUSS THAT AND MUCH MORE. BUT FIRST, LET'S CHECK IN ON THE MARKETS. THERE IS A MACRO PLAYBOOK AND IT IS A QUARTERLY CPI PRINT BEING DIGESTED BY THE MARKETER THAT HAS SENT STOCKS TO RECORD HIGHS. RECORD HIGHS ON GLOBAL STOCKS, THE S&P, THE STOXX 600 IN EUROPE ALSO GETTING A LIFT BECAUSE PEOPLE START TO FACTOR IN THAT MAYBE WE'LL GET RATE CUTS FROM THE FEDERAL RESERVE. THAT 10-YEAR YIELD DOWN SEVEN BASIS. WE MOVE ON BECAUSE THE DOLLAR
IS DOWN. THAT MEANS CRYPTO IS HIGHER. A RISK-ON FEEL TO TODAY'S TRADE. ALMOST 5% UP ON BITCOIN. >> GOOGLE AND ALPHABET SHARES ARE HIGHER A SECOND DAY. WE WILL GO LATER TO OUR REPORTER WHO WAS ON THE GROUND. NEW AI-BACKED SEARCH, NEW ITERATIONS OF THE MODELS.
CLEARLY INVESTORS LIKE THAT. WE WILL UNPACK NEW TECHNOLOGIES. OTHER THINGS WE ARE WATCHING, THE MOVERS TO THE DOWNSIDE AND THE MEGACAPS THAT ARE A DRAG ON THE NASDAQ 100, AMAZON AND TESLA. AMAZON IS LOWER FOR A SECOND DAY AFTER THE NEWS OF CEO IS LEAVING -- THE CEO OF AWS. AND I PUT THIS THERE IS A PROXY FOR OPENAI, WHICH WE WILL DISCUSS LATER, IT IS HIGHER BY 1%. VERY BIG AI FOCUS IN A CROWDED FIELD RIGHT NOW.
>> IT IS CROWDED. ALSO WE ARE BEING COUNTED FOR THE NEWS FLOW RIGHT NOW PARTICULARLY IN THE WORLD OF SOCIAL MEDIA. THE FUTURE OWNERSHIP OF SOCIAL MEDIA KEY PLAYER THAT NEEDS TO BE DIVESTED OR INDEED BE BANNED FROM THE U.S.. WE WANT TO DISCUSS TIKTOK. WE WELCOME OUR BLOOMBERG TV, AND RADIO AUDIENCES WORLDWIDE TO JOIN PROJECT LIBERTY FUND ARE FRANK MCCOURT WHO IS BUILDING A CONSORTIUM TO BID FOR SOCIAL MEDIA UP TIKTOK'S U.S. BUSINESS. FRANK, WELCOME TO THE SHOW. HOW MUCH MONEY DO YOU ACTUALLY HAVE TO BE OFFERING TO TIKTOK? FRANK: IT'S TOO EARLY TO KNOW HOW MUCH IT WILL BE SOLD FOR OR IF IT WILL BE SOLD.
WE BELIEVE IT WILL BE SOLD AND WE ARE BETTING ON THAT. WE DON'T HAVE THE INFORMATION YET ON WHAT EXACTLY THEY ARE SELLING. WE CAN'T REALLY TELL WHAT THE PRICE WILL BE. BUT ONE THING THAT IS,
IMPORTANT IS WE ARE NOT INTERESTED IN THE ALGORITHM. WE ARE INTERESTED IN ACTUALLY AN ALTERNATIVE WEB WHERE PEOPLE OWN AND CONTROL THEIR DATA AND IDENTITY. SO WE ARE NOT INTERESTED IN BYTEDANCE'S ALGORITHM WHICH MAKES OUR BEING PARTICULARLY UNIQUE. ED: WE WILL DISCUSS THE TECHNOLOGY PLAN. IT'S IMPORTANT GIVEN THE ALGORITHM WAS ESSENTIALLY PUT ON AN EXPORT PR THEN-. HAVE YOU SPOKEN TO TIKTOK OR
BYTEDANCE? HAVE YOU TOOK -- SPOKEN TO THE U.S. GOVERNMENT ABOUT THIS BEING? FRANK: WE HAVE NOT SPOKEN TO HER BYTEDANCE OR TIKTOK BUT WE HAVE SPOKEN TO A NUMBER OF OTHER ACTORS AND HAVE BEEN ENCOURAGED TO MOVE FORWARD WITH THIS APPROACH. REMEMBER, THIS IS PUTTING FORWARD AN ALTERNATIVE VISION FOR HOW THE INTERNET OPERATES.
RIGHT NOW WHETHER IT IS TIKTOK OR OUR OWN INVESTMENT FORMS, OUR INFORMATION, OUR DATA, OUR PERSONHOOD IS SCRAPED AND ABROGATED BY THESE PLATFORMS AND THEY APPLY ALGORITHMS TO IT. IT IS PAST TIME THAT WE HAVE AN ALTERNATIVE VERSION OF THE INTERNET WHERE WE EACH OWN AND CONTROL IDENTITY, OWN AND CONTROL OUR DATA AND WE HAVE THE BENEFITS OF THE INTERNET AND THE WONDERFUL TECHNOLOGY THAT IS CONNECTED ALL OF US, BUT WE ARE IN CHARGE OF US. AGENCIES RETURNED TO INDIVIDUALS. THAT IS THE TECHNOLOGY WE HAVE BEEN BUILDING FOR THE LAST FIVE YEARS. SO THAT TECH WORKS, WE HAVE A PROOF OF CONCEPT. THERE IS ALMOST ONE MILLION USERS NOW ON THIS NEW PROTOCOL SO NOW IT IS TIME TO GIVE PEOPLE A REAL CHOICE. ED: YOU MENTIONED OTHER ACTORS.
I AM CONSCIOUS THAT SEQUOIA AND GENERAL, U.S.-BASED FIRMS THAT SIT ON THE CAP TABLE AT BYTEDANCE. DO YOU HAVE THEIR SUPPORT ON YOUR BEING? FRANK: IT'S TOO EARLY TO MAKE THESE STATEMENTS. WE HAVE RETAINED GUGGENHEIM SECURITIES AS OUR ADVISOR TO PUT TOGETHER ALL THAT PEICES OF THIS BID. THIS IS EARLY IN THE PROCESS. WE DON'T KNOW EXACTLY WHAT BYTEDANCE WILL BE SELLING. THEY FILED A LAWSUIT RECENTLY
SO THEY ARE FIGHTING THIS. BUT I AM CONFIDENT THAT AT THE END OF THE DAY, THEY WILL EITHER HAVE TO SELL OR SHUT IT DOWN. AND WE DON'T WANT TO SEE TIKTOK SHUT DOWN. THERE IS MILLIONS OF USERS USING TIKTOK AND WE WANT TO SEE THEM CONTINUE TO ENJOY IT. BUT AGAIN, WE ARE NOT INTERESTED IN THE ALGORITHM WHICH I THINK MAKES OUR BID UNIQUE. WE CAN MIGRATE THESE USERS TO A NEW VERSION OF THE INTERNET WHERE THE 170 MILLION USERS ACTUALLY PARTICIPATE IN THE VALUE THEY CREATE AND ARE IN CHARGE OF THEIR DATA. IMAGINE A VERSION OF TIKTOK
WHERE THE VERSION IS CLICKING ON THE TERMS OF USE OF EACH OF THE 100 70 MILLION USERS RATHER THAN THE USERS CLICKING ON THE TERMS OF USE OF ONE PLATFORM. I DON'T THINK THE PLATFORM SHOULD BE IN CONTROL OF ANY ONE PERSON, ONE COMPANY OR A CHINESE COMMUNIST PARTY. IT'S IMPORTANT THAT WE SHIFT OUR MINDSET NOW AND SHIFT THE PARADIGM FROM THE INTERNET WE HAVE BEEN LIVING WITH WHICH, IS DOING REAL HARMS, UNDERMINING DEMOCRACY, A RIP IN SOCIETY APART. WE ARE HEARING MORE ABOUT THE HARMS TO CHILDREN.
CAROLYN: FRANK MCCOURT, PROJECT LIBERTY FOUNDER AND CHAIRMAN. WE ARE DISCUSSING YOUR POTENTIAL BID FOR TIKTOK IF INDEED IT IS TO BE SOLD AND THAT IS A BIG IF. ALL OF THIS SOUNDS PHILANTHROPIC. DO YOU NOT WANT ANY MONEY BACK
IF YOU WILL BE RAISING BILLIONS OF YOUR OWN POTENTIALLY ON THE LINE HERE? FRANK: IT'S INTERESTING THAT IT SOUNDS PHILANTHROPIC TO YOU. I THINK IT HAS THE POTENTIAL OF BEING ONE OF THE BIGGEST IMPACT PROJECTS OF OUR LIFETIME. BUT THIS HAS TO HAVE COMMERCIAL COMPONENTS TO IT TO BE REALISTIC. IT CAN'T BE SOME ALTERNATIVE INTERNET THAT IS BETTER ARCHITECTED, HEALTHIER FOR PEOPLE, BUT NO ONE USES IT. CAROLINE: WILL IT BE APPETIZING? IS IT SUBSCRIPTION-BASED, HOW WILL YOU MAKE MONEY BACK? FRANK: ALL THE ABOVE. ONCE YOU UNLEASH THE POWER AND
THE INNOVATION AND THE INVENTION OF A DATA ECONOMY, WE ARE GOING TO SEE IDEAS AND MODELS THAT FAR EXCEED WHAT WE HAVE TODAY. RIGHT NOW, ALL OF THIS IS TIED UP IN JUST A FEW PLATFORMS. LET'S UNLEASH THE INNOVATION OF EVERYONE AND HAVE THE VALUE SHARING PROPOSITION BE A BIT DIFFERENT. OF COURSE, THERE WILL BE COMMERCIAL USES ARE LIMITED ONLY BY OUR IMAGINATION.
MAYBE THERE WILL BE SOME ADVERTISING MODELS, MAY BE THERE WILL BE SOME SUBSCRIPTION MODELS, BUT IT HAS TO BE HIGHLY COMMERCIAL. ED: THERE IS A RECURRENT QUESTION, I THINK CAROLINE WOULD BACK ME UP THAT I HAVE BEEN CONSISTENT IN ASKING IT WHICH IS, THERE ARE 170 MILLION USERS OF TIKTOK AND MOST OF THEM LIKE USING IT AS IT IS. IS THERE ANYTHING YOU CAN TELL ME ABOUT THE PROJECT PLAN OR YOUR ENGAGEMENT WITH THE EXISTING USER BASE THAT WOULD CONVINCE THAT 170 MILLION THAT THEY WILL WANT TO CONTINUE USING IT, WHATEVER HAPPENS? FRANK: OF COURSE, THE KEY TO THE TRANSACTION IS FOR THEM TO BE EXCITED ABOUT MIGRATING TO THIS NEW MODEL OF THE INTERNET, LET'S CALL IT. WHERE ARE THEY ONLY CONTROL OF
THEIR DATA AND WHERE THEY PARTICIPATE IN THE VALUE. THE USER EXPERIENCE HAS TO BE EVERY BIT AS EASY, POLISHED AND FUN AS IT IS NOW, BUT WOULDN'T USERS BE EXCITED ABOUT ACTUALLY BEING IN CHARGE AND ACTUALLY PARTICIPATING IN THE VALUE? SO THIS HAS TO BE SEAMLESS IN TERMS OF THE USER EXPERIENCE, BUT THE UNDERLYING TECHNOLOGY WILL BE FAR BETTER. THE DESIGN OF THE TECHNOLOGY. PUTTING THEM IN CHARGE OF THEMSELVES. SO OF COURSE IT NEEDS TO BE
DONE IN THE WAY WHERE THE USERS ARE AS EXCITED OR MORE EXCITED ABOUT THE NEW VERSION. BUT REMEMBER, RIGHT NOW THERE IS A RISK THAT IT WILL BE SHUT DOWN . WE DON'T WANT TO SEE IT SHUT DOWN, WE WENT TO SEE THE USERS CONTINUE TO BE ON A PLATFORM THAT OUR GOVERNMENT IS COMFORTABLE WITH AND THAT BYTEDANCE, QUITE FRANKLY, IS COMFORTABLE IN SELLING IT ED: WE USE WORDS LIKE CONSORTIUM OR COALITION. THERE ARE A NUMBER OF PEOPLE WHO HAVE RAISED THEIR HAND ABOUT DOING SOMETHING WITH TIKTOK'S U.S. ASSETS -- STEVE MNUCHIN, AND ERIC SCHMITT, ONE OF THE GOOGLE FOUNDERS, TOP OF MIND.
HAVE YOU SPOKEN TO THEM AND PROPOSED, FOR EXAMPLE, THAT YOU GET TOGETHER AND BRING YOUR INTELLECTUAL CAPITAL IN ONE BID? FRANK: NO, I HAVE NOT. I WENT TO DISTINGUISH OUR BID FROM WHAT I BELIEVE THERE BID -- THEIR BIDS TO BE ABOUT. WE DON'T NEED TO SAUDI MONEY. WE ARE NOT TALKING ABOUT THE SAME ARCHITECTURE WHERE WE REPLACE CHINESE OWNERSHIP WITH ANOTHER OWNERSHIP AND HAVE THUS CONTINUED TO HAVE A CENTRALIZED AUTOCRATIC, SURVEILLANCE-BASED TECHNOLOGIES WHERE USERS' DATA IS SCRAPED AND SO FORTH. OUR VERSION IS NOT A TOP-DOWN APPROACH.
OVER VERSION IS IN POWER THE USERS, EMPOWER PEOPLE AND MAKE THIS A PEOPLE’S BID. MAKE THIS SOMETHING WHERE INDIVIDUALS HAVE AGENCY AND CHOICE AND POWER RETURNED TO THEM. THE HARMS WE ARE SEEING WITH THE INTERNET, AND THIS ISN'T LIMITED TO TIKTOK, RIGHT, OUR OWN PLATFORMS ARE BUILT WITH THE SAME MODEL OF SCRAPING DATA AND EXPLOITING IT. ISN'T IT TIME WE HAVE A BETTER MODEL? I SEE THIS OPPORTUNITY IS A FANTASTIC OPPORTUNITY TO TAKE PROVEN TECHNOLOGY AND SCALE IT AND GIVE PEOPLE A CHOICE, AN ALTERNATIVE. CAROLINE: YOU HAVE PEOPLE WHO ARE AT THE FOREFRONT OF THAT ARGUMENT ABOUT THE HARMS OF SOCIAL MEDIA. THE ANXIOUS GENERATION.
DAVID CLARK'S. TIM BERNERS-LEE, WHO HELPS TO CREATE THE WORLD WIDE WEB HOWEVER. , IT SOUNDS LIKE YOU WILL NEED CROWDFUNDING. IF YOU DON'T NEED SAUDI MONEY, WHAT MONEY WILL YOU NEED WHEN YOU GET A PRICE POINT? FRANK: IT WILL BE A COMBINATION OF PRIVATE CAPITAL, PUBLIC CAPITAL AND PEOPLE’S CAPITAL. CAROLINE: SO YOU WILL BE A CROWD FUNDED? FRANK: CROWDFUNDING HAS AN IMPLICATION. WE ARE NOT RAISING MONEY ON THE
INTERNET. . WE HAVE BROUGHT IN GUGGENHEIM SECURITIES TO HELP ORGANIZE HOW WE RAISE MONEY. THE INVESTORS HERE SHOULD BE A BROAD -- REFLECT THE BROAD COALITION WE ARE TRYING TO CREATE HERE ABOUT RECLAIMING THE INTERNET AND USING THIS AS AN OPPORTUNITY TO DO THAT. . I WOULD IMAGINE IN ADDITION TO PRIVATE CAPITAL THAT IT WOULD BE PENSION FUNDS, ENDOWMENTS, FOUNDATIONS, INTERESTED IN A RETURN, BUT NOT ONLY A RETURN ON THEIR CAPITAL, THAT HAVE A LONGER TIME HORIZON AND WOULD LIKE TO SEE THE INTERNET RE- ARCHITECTED SO IT IS BETTER FOR ALL OF US AND IT SUPPORTS DEMOCRACY, SUPPORTS CIVIL SOCIETY AND PROTECT YOUNG CHILDREN.
THE BOOK I WROTE RECENTLY CALLED "OUR BIGGEST FIGHT" GET INTO DETAIL ABOUT THE HARMS THE CURRENT VERSION OF THE INTERNET ARE DOING TO ALL OF US. IT'S NOT LIMITED TO CHILDREN, BUT ESPECIALLY CHILDREN, AND I THINK OUR NUMBER ONE OBLIGATION IS TO PROTECT KIDS. . CAROLINE: IN FACT, THOUGHT, LEADERSHIP THERE FROM FRANK MCCOURT, PROJECT LIBERTY FOUNDER AND CHAIRMAN. WE THANK HIM FOR HIS TIME. ED: COMING UP,, WE BRING YOU THE BIG TAKEAWAYS FROM GOOGLE'S ANNUAL I/O DEVELOPERS A♪ >> BEE BOOP TIME TO GET UP, YOU SILLY LITTLE NERDS, WAKE UP♪ ED: THAT WAS A DJ AT THE DEVELOPERS CONFERENCE TESTING OUT GOOGLE'S DJ MODE THAT GOOGLE RECENTLY ADDED TO ITS GENERATIVE AI TEXT TO MUSIC TO IMPROVEMENT GOOGLE ALSO RULED OUT A NEW SEARCH ENGINE THAT INCLUDES RESPONSES WRITTEN BY AI. BLOOMBERG'S JULIA LIVE WAS AT
THE DEVELOPERS CONFERENCE UNDER THE BIG TEN AT THAT RAVE -- UNDER THE BIG TENT AT THAT RAVE AND TO DRIVES US. THE BIG NEWS I THINK WAS A I-POWERED SEARCH. JULIA: ABSOLUTELY RIGHT. THIS IS A REAL SEACHANGE IN GOOGLE SEARCH. FOR THE PAST YEAR GOOGLE HAS BEEN EXPERIMENTING WITH GENERATIVE AI OVERVIEWS.
BUT THAT WAS A SPECIAL TEST VERSION OF THE PRODUCT. NOW THEY ARE ROLLING OUT A GENERATIVE AI OVERVIEWS IN SEARCH SO ALL USERS IN THE UNITED STATES WILL BEGIN SEEING THEM THIS WEEK. FRANCINE: JULIA LOVE WAS THE HYPE MAN WHEN IT COMES TO GOOGLE I/O, THANK YOU FOR JOINING US AND SITTING US OFF OUR CONVERSATION FROM THE INVESTOR PERSPECTIVE, AYAKO YOOSHIOKA IS JOINING US FROM WEALTH ENHANCEMENT GROUP. WHAT DID YOU MAKE OF ULTIMATELY GOOGLE WANTED TO BASICALLY OUTSHINE WHAT OPEN IT I PUT OUT THERE YESTERDAY. DID THEY MANAGE TO DO THAT? HAVE THEY MANAGED TO CONVINCE US THAT THEY AREN'T BEHIND IN THIS RACEAYOOKA: . AND REALLY ALL THE DIFFERENT
TYPES OF WAYS THEY ARE REDEFINING WHAT SEARCH REALLY IS FOR ALL OF US, WHETHER IT IS THE OVERVIEW PORTION WITHIN THE TRADITIONAL PART OF SEARCH, OR JUST BEING ABLE TO USE YOUR PHONE AND THE VIDEO SCREEN IN ORDER TO DO A SEARCH. MUSIC AND ALL THE OTHER WAYS SEARCH IS EVOLVING. I THINK IT IS WHAT WAS ON DISPLAY YESTERDAY. ED: THE STAKES ARE PRETTY HIGH.
I WAS REFLECTING EARLIER IN THE SHOW THAT THE STOCK IS UP FOR A SECOND DAY. I THINK BACK TO SOME OF THE GAS ALPHABET HAS HAD AS WELL IN DEMOING ITS GENERATIVE AI TOOLS AND HOW THAT HAS INFECTED THE STOCK, DO YOU THINK YOU HAVE DONE ENOUGH TO CONVINCE INVESTORS FOR THE LONG-TERM THAT WE HAVE GOT THIS, ON A CONSUMER FACING OR BUSINESS FACING AI? AYAKO: I THINK THE LANDSCAPE IS RAPIDLY EVOLVING. IT IS DIFFICULT TO SAY WHETHER OR NOT ALPHABET OR GOOGLE IS REALLY IN THAT POSITION AT THAT POINT WITH AI. IT HAS CLEARLY GOT A MUCH BIGGER COMPETITIVE LANDSCAPE THAN WHAT WAS TRADITIONAL SEARCH'S COMPETITIVE LANDSCAPE. WE WILL HAVE TO SEE HOW THIS EVOLVES IN THE COMING MONTHS AND YEARS. CAROLINE: MANY ARE FEELING ON THE STREET THAT THEY HAVE REGAINED THE INITIATIVE. MANY ARE EXCITED ABOUT HOW
GMAIL IS GOING TO BECOME AND MAY BE EXCITED THAT GOOGLE GLASS IS COMING FOR A REITERATION AND A MODERN-DAY TAKE. BUT I AM INTERESTED ULTIMATELY AS TO WHETHER THIS ACTUALLY ADDS TO REVENUE, TO FUTURE PROFITABILITY FROM THE BUSINESS WHEN THEY ARE UNDERCUTTING ON THE PRICE PERSPECTIVE, SIGNIFICANTLY ON THE AI OFFERING? AYAKO: AND THE COST OF ALL OF THIS AI AND INTEGRATING IT INTO ALL THE DIFFERENT PROGRAMS THEY WILL HAVE, ALL THE DIFFERENT OFFERINGS THEY WILL HAVE, IS STILL GOOD TO CONTINUE TO INCREASE. WE SAW THAT WITH THE MOST RECENT QUARTER AND THEY ARE INCREASING CAPITAL SPENDING FOR 2024. SO WE WILL HAVE TO SEE HOW THIS REALLY SHAPES UP FROM A FINANCIAL PERSPECTIVE BOTH ON THE TOP LINE SIDE, FROM A REVENUE PERSPECTIVE, AS WELL AS THE OVERALL IMPACT TO EARNINGS. ED: CAROLINE MENTIONED SOMETHING INTERESTING, HARDWARE IS KIND OF BACK, AND META AND THE RAY-BANS IS COMING UP EVERY WEEK ON THE SHOW. IF YOU ARE AN INVESTOR AND
PORTFOLIO MANAGER, DO YOU SIT IN THE MORNING AND GO, YOU KNOW WHAT, I'VE GOT TO GET THE RESEARCH DESK ON THIS HARDWARE USE CASE OF AI? AYAKO: NOT SURE IF I AM COOL ENOUGH TO GET ALL THE HARDWARE WHETHER IT IS GOOGLE GLASS OR META RAY-BANS. I THINK EVERYBODY IS LOOKING FOR THAT NEXT TAILORED TECHNOLOGY. WHETHER IT IS HARDWARE OR SOFTWARE. AND THAT IS THE PORTION I THINK EVERYBODY IS STILL LOOKING FOR WHEN IT COMES TO GENERATIVE AI. CAROLINE: ALSO, I THINK MANY FORGET THAT THERE IS A WEIGHT ON GOOGLE'S SHOULDERS. THEY CAN'T RULE OUT PRODUCTS AS FAST BECAUSE THEY HAVE BILLIONS OF USERS AND THE READY WE HAVE SEEN THEM RUSH, MANY WOULD SAY, THE IMAGE-GENERATION SIDE OF THE EQUATION AND LOOK AT THE BACKLASH THEY GOT FOR THAT WITH GEMINI.
HOW MUCH ARE YOU FRUSTRATED BY THE FACT THAT THEY ARE TALKING UP A LOT OF THINGS AND THEN THEY LEAVE OUR IMAGINATION AS TO WHETHER THEY WILL BE ON OUR HANDS. AYAKO: IT IS A LEVEL OF FRUSTRATION WHEN IT COMES TO THE OVERALL COMMUNICATION FROM GOOGLE. THEY ARE IN A RUSH, BECAUSE THEY ARE IN OPPOSITION TO SORT OF PROTECT WHAT THEY HAVE. AND THE POSITION THEY ARE IN REGARDING SEARCH. SO WE WILL SEE IF THEY ARE ABLE TO REFINE SOME OF THAT GOING FORWARD. I THINK THE MOST RECENT GOOGLE I/O YESTERDAY SHOWED THEY WERE ABLE TO REFINE IT FROM LAST YEAR AND WE'LL SEE IF THAT CONTINUES NEXT YEAR. ED:
AYAKO YOOSHIOKA, PORTFOLIO MANAGER AT WEALTH ENHANCEMENT GROUP. I THINK YOU ARE COOL ENOUGH. COME BACK ON THE SHOW. AS WE HAD TWO BRICKS, INVESTOR-FRIENDLY POLICIES COMING OUT OVERNIGHT, AUTHORIZATION OF A BUYBACK PLAN THAT HAS BEEN UNIVERSALLY AROUND THE WORLD SOMETHING INVESTORS HAVE CHEERED. THE YEN YEMENI GOVERNMENT SAYS THEY ARE HOLDING BACK REPAIRS ON ED: IP INTERNET CABLE THAT ED: HAS BEEN DAMAGED IN THE RED SEA. THIS, AS THE GOVERNMENT CONDUCTS AN INVESTIGATION INTO THE CABLE OWNER'S ALLEGED TIES TO THE HUTU MILITIA. IT CONTROLS MUCH OF THE CABLES THAT CONNECT EUROPE TO THE MIDDLE EAST. PLUS, ALPHABETS YOUTUBE HAS BLOCKED VIDEOS OF
THE HONG KONG PROTEST IN THE CITY JUST DAYS AFTER A LOCAL COURT APPROVED THE INJUNCTION. GOOGLE'S VIDEO NETWORKS THAT IT WOULD FOLLOW THE COURT'S RULING AND BLOCK 32 VERSIONS OF THE VIDEO TITLED "GLORY TO HONG KONG." WHILE EXISTING LAWS PUNISH PEOPLE FOR PLAYING THE SONG, THE CHINESE GOVERNMENT HAS SOUGHT TO ERASE IT FROM ALL PLATFORMS. AND THIS COMPANY SAID THAT IS CONSIDERING AN IPO IN LONDON IN WHAT WOULD BE THE FIRST SIZABLE LISTING FOR THE CITY. THE COMPANY DID NOT DISCLOSE HOW MUCH IT PLANS TO RAISE.
CAROLINE: LET'S SHIFT OUR ATTENTION TOWARDS A KEY FUNDER, PALMER LUCKEY, ABOUT HOW AI AND AUTONOMOUS SYSTEMS ARE CHANGING ON THE BATTLEFIELD. WE SPOKE TO HIM LAST WEEK, BUT BLOOMBERG ORIGINALS HOST EMILY CHANG CAUGHT UP WITH HIM TO DISCUSS HIS MISSION TO TACKLE LEGACY DEFENSE CONTRACTORS AND THE CHALLENGE OF SCALING THE TECH. LET'S TAKE A LISTEN. >> RIGHT NOW WE ARE IN THE HIGHER GROWTH STAGE. WE HAVE DONE THINGS I AM PROUD OF.
BUT I AM VERY AWARE OF THE FACT THAT WE ARE NOT A PROFITABLE BUSINESS, WE ARE LIVING ON BORROWED TIME, SO IT'S HARD FOR ME TO FEEL LIKE I HAVE MADE IT WHEN I KNOW THAT IF ANYONE CAN RAISE MONEY FROM VCS , IT IS BUY A BIG OFFICE AND FILL IT FULL OF PEOPLE. THE QUESTION IS ARE THEY BUILDING THE RIGHT THINGS AND WILL THOSE THINGS PAY OFF? CAROLINE: YOU CAN CATCH MORE OF THE CONVERSATION ON "THE CIRCUIT ED: WELCOME BACK TO "BLOOMBERG TECHNOLOGY." CAROLINE: LET'S GET YOU A QUICK CHECK ON THE MARKETS. ITS RECORD HIGHS, FOLKS, BECAUSE THE MACRO PICTURE IS ONE OF ELATION COOLING, CPI PRINT IS WHAT THE MARKET WANTED TO SEE, FOR THE MOMENT IT'S THE NASDAQ 100 IN THE S&P 500, HITTING GLOBAL BENCHMARKS. THE ALL COUNTRY INDEX UP 9/10
OF 1%. I'M LOOKING AT IT COIN, ALL RISK ASSETS WING WELL ON THE IDEA THAT THE FED CUT THIS YEAR, FACTORED IN BY THE MARKET UP 5% AS THE DOLLAR MOVES LOWER. INDIVIDUAL MOVERS, A KEY PLAYER HELPING THE BENCHMARK, ONE POINT 3%, WHICH HELPS WHEN YOU ARE MORE THWARTED WORK -- MORE THAN ONE POINT $3 TRILLION WITH 13F FILINGS THIS MORNING AND PEOPLE ARE UPPING THEIR STAKES IN NVIDIA, REMEMBER THOSE EARNINGS COME OUT NEXT WEEK. THIS IS A SMALL COMPANY BUT A BIG MOVE, HIGHLIGHTING UP MORE THAN 20%, API FOR WORK OBJECTS WITH SOFTWARE DOING WELL, IT WOULD SEEM, FROM THIS PERSPECTIVE. MAYBE IT WILL BE BOUGHT BY KKR, PULLING IN A 22 MILLION EURO BID. IT'S ALL ABOUT THE PHONE AT WORK .
AT THE CLOSE WE ARE UP MORE THAN 2% OVER THERE IN EUROPE FOR THIS PLAYER. WHAT ARE YOU LOOKING AT? ED: A BIG STORY THAT BROKE YESTERDAY, OPENAI CO-FOUNDER, LEAVING THE ARTIFICIAL INTELLIGENCE COMPANY, DEPARTURE ENDING MONTHS OF SPECULATION ABOUT THE FUTURE OF WHO IS A TOP AI RESEARCHER. SOMEONE WHO PLAYED A KEY ROLE IN THE BRIEF OUSTER OF SAM ALTMAN LAST YEAR. JOINING US WITH MORE, SHAREEN,
THIS IS COMPLICATED. ILYA WAS AT THE CENTER OF THAT MAD WEEKEND WHERE YOU AND I WORK FOR 48 HOURS STRAIGHT TO FIGURE OUT WHAT WAS GOING ON. HE'S A FORMER BOARD MEMBER, FOUNDER OF OPENAI, LEAVING THE COMPANY. DO WE KNOW WHY, SPECIFICALLY, HE'S LEAVING? >> HE DIDN'T SAY MUCH ABOUT WHY HE IS LEAVING. SINCE THE BRIEF OUSTER OF SAM ALTMAN, ILYA, ONCE A COMMON FIGURE IN THE OFFICE, NOT SEEN AS MUCH. THERE HAVE BEEN RUMORS ABOUT WHAT'S GOING TO HAPPEN WITH ILYA , IS HE GOING TO LEAVE THE COMPANY.
INTERNALLY IT WASN'T SO MUCH OF A BIG SURPRISE TO MANY PEOPLE THAT HE WOULD EVENTUALLY LEAVE. WHAT HE IS HE GOING TO DO NEXT? HE SAYS HE HAS A NEW PROJECT AND HE WILL SHARE THE DETAILS IN DUE TIME. WE ARE ALL WAITING TO SEE. CAROLINE: ULTIMATELY IT COMES DOWN TO A DIFFERENCE OF OPINION ABOUT THE WAY YOU BUILD GENERATIVE INTELLIGENCE AND ARTIFICIAL GENERAL INTELLIGENCE FOR THE GOOD OF HUMANITY. IS THAT WHAT IS UNDERLYING HERE, A PHILOSOPHICAL DIFFERENCE? OR ULTIMATELY THAT OTHER THINGS NEED TO BE BILLED IN THIS MOMENT OF GREAT EXUBERANCE AROUND THE TECHNOLOGY? SHIRIN: IT'S HARD TO SAY, BUT WE KNOW THAT ILYA WAS WORKING AT THESE ISSUES AROUND THE ETHICS OF AI.
HE CO-LED THE SOUP AND -- SUPER ALIGNMENT TEAM TO MAKE SURE IT'S IN LINE WITH HUMAN VALUES, SOMEONE INTERESTED IN THE IMPLICATIONS OF WHAT HE'S BUILDING. ULTIMATELY HIS DECISION TO LEAVE, DOES HE WANT TO DO SOMETHING ELSE OR DOES HE HAVE DEEPER CONFLICT, THAT'S STILL A BIG QUESTION. CAROLINE: ALSO OTHERS LEAVING IN HIS WAKE. MORE TO REPORT OUT THROUGHOUT THE DAY, I'M SURE.
THANK YOU FOR BREAKING IT DOWN ON THAT KEY DEPARTURE COMING FROM OPENAI. STICKING WITH ARTIFICIAL INTELLIGENCE IN THE CLIP -- GROWING LEGAL BACKLASH AGAINST COMPANIES EXPERIENCING RAPID GROWTH IN HOW YOU CAN HARNESS GENERATIVE AI IN THE LEGAL SPHERE. WE CAN HAVE BOTH OF THESE CONVERSATIONS AT THE SAME TIME WITH AN AI POWERED LEGAL INTELLIGENCE PLATFORM LEADER.
YOUR PLATFORM CONNECTS OVER 3000 LITIGATORS WITH NEW CASES FACILITATING OVER 0 MILLION IN LITIGATION. AS IF LAWYERS WERE NOT AS ENOUGH YOU ARE FINDING WAYS IN WHICH THERE CAN BE GROUP LAWSUITS BROUGHT, INTERESTING AT THE MOMENT WE HAVE JUST SEEN ONE VERSUS THE U.S. GOVERNMENT ON BEHALF OF TIKTOK. >> FIRST OF ALL, IT'S GREAT TO BE HERE. I ALSO WANT TO SAY JUST AROUND INTELLIGENCE IN GENERAL, A QUESTION REGARDING WHETHER LAWYERS ARE BUSY ENOUGH, OUR MISSION IS TO DIVIDE CASES THAT HAVE A LOT OF SOCIAL AND LEGAL IMPACT AROUND ISSUES THAT ARE BASICALLY HARMING CONSUMERS. BUSINESSES AND EMPLOYEES.
WE ARE FOCUSED ON CLIMATE PROTECTION, WHICH IS SUPER IMPORTANT, AND HARNESSING AI TO DO SO, IDENTIFYING SOCIALLY IMPACTFUL CASES. ED: HOW DOES THE AI TECHNOLOGY WORK? GILA HAYAT: IT'S AN INTERESTING INTERSECTION BETWEEN LOOKING AT LEGAL DATA AND EVENT DATA, WHICH IS PRETTY MUCH ANYTHING THAT CAN HAPPEN ON SOCIAL MEDIA OR EVENTS HAPPENING ONLINE. THE WAY THAT WE DO SO IS WE LOOK AT TREMENDOUS AMOUNTS OF LEGAL DATA, WHICH FOR CASES, CASE LAW, UNDERSTANDING THE FACT PATTERNS AND HOW THE EVENTS TAKE ACTION ON EVERYDAY LIFE. ED: IS THIS UNDERPINNED BY A SPECIFIC LLM OR SOMEONE ELSE'S AI MODEL, OR SOMETHING THAT YOU BUILT YOURSELF? GILA: THE PROCESS HAPPILY INFUSES LLMS, IT IS A MULTISTEP PROCESS THAT TAKES INTO CONSIDERATION INGESTING THE DATA, UNDERSTANDING WHAT IT IS, AND BASICALLY EXTRACTING THE LEGAL PHENOMENON THAT WE ARE TAKING TO ACTION. A LOT OF PEOPLE ASSUME THAT LEGALESE IS BASICALLY A DIFFERENT DIALECT OF ENGLISH, AND THEY ARE CORRECT SO.
THIS IS THE KIND OF INTERSECTION WE ARE LOOKING AT. ED: OH BOY, I KNOW. I SUFFERED THROUGH THREE YEARS OF LAW SCHOOL. LEGALESE WENT IN ONE EAR AND OUT THE OTHER. PLEASE CONTINUE. GILA: YEAH, AS A NONLAWYER MYSELF, A TECH PERSON, I'M FASCINATED BY HOW CAN WE ALIGN THIS TYPE OF LANGUAGE AND MAKE IT USABLE FOR CONSUMERS AND FOR THE PEOPLE? OFTEN MOST OF THE LEGAL VIOLATIONS THAT HAPPEN CAN HAPPEN PRETTY MUCH IN EVERY TYPE OF SERVICE, PRODUCT, OR BUSINESS THAT YOU INTERACT WITH.
THERE IS A CONSTANT FIGHT OVER OUR ATTENTION. THIS IS WHAT WE ARE TRYING TO BUILD, WHERE WE, WHERE CONSUMERS DON'T HAVE TO BE WORRIED ABOUT THEIR RIGHTS BEING VIOLATED, OR EVEN THE QUALITY OF THE AIR AROUND THEM. RATING, BECAUSE THERE IS NOT ENOUGH FOCUS, NOT ENOUGH POWER TO THE CONSUMER TRYING TO UNDERSTAND AND INGEST THAT AMOUNT OF DATA. ON THE OTHER SIDE, LAWYERS, LAWYERS ONLY NOW STARTING TO DEVELOP INTELLIGENT GATHERING SKILLS REQUIRED, UNDERSTANDING THE FULL PICTURE, SUPPORTED BY FACT, GENERALLY CREATING MORE IMPACTFUL CASES. CAROLINE:
WE HAVE ALREADY HEARD SOME OF THE ISSUES OF HALLUCINATION WHEN IT COMES BACK PREVIOUS CONTRACTS AND CASES BY THE JEW -- USE OF GENERATIVE AI AND MAKING THEM UP, BUT I IMAGINE THAT MANY COMPANIES OUT THERE ARE UPSET THAT THEIR CONTRACTS ARE BEING USED AS DATA, ARTISTS AND CREATORS OUT THERE WORRIED ABOUT THEIR OWN CREATIONS USED IN LARGE LANGUAGE MODELS. HOW MUCH SHE YOU SEE THAT AS AN AREA TO WADE INTO? GILA: THE DISCOURSE AROUND AI AND THE CONCEPT OF ORIGINALITY AND THE OWNERS OF THE CONTENT IS A HOT TOPIC. WE SHOULD DISCUSS IT FROM MULTIPLE ANGLES IN A WAY WHERE WE WANT TO KEEP URGING ORIGINALITY INHUMANITY AND CONTENT CREATION AROUND IT, SO THAT PEOPLE KEEP INNOVATING RATHER THAN JUST REPLICATING CONTENT THAT DOESN'T HAVE MUCH IMPACT.
I THINK THAT ALSO FROM THE LEGAL PERSPECTIVE, A LOT OF THE HIGH-MARGIN TASK WORK, LIKE CONTRACTS, WILL BE SCARCE. THE FOCUS WILL HAVE TO SHIFT TO A DIFFERENT KIND OF TASK THAT REQUIRES THE CORE HUMAN IMPACT AND THE SEED WIRED TO CREATE SUCH A TASK. I THINK THAT IN THE UPCOMING YEARS, WE ARE GOING TO SEE MAYBE DIFFERENT WAYS TO COMPENSATE CONTENT CREATORS AND HAVING A MORE CLEAR AND TRANSPARENT WAY OF HOW THIS DATA IS GOING TO BE USED. IN TERMS OF HALLUCINATION, HOW WE SOLVED IT IS FIRST OF ALL, WE ARE VALIDATING THE CONTENT WE ARE CREATING BECAUSE WE ARE VERY FOCUSED ON GETTING A TRUSTWORTHY INSIGHT BASED ON OUR SOURCES. WE ARE ALSO PROVIDING THE SOURCES FOR OUR FINANCE TO UNDERSTAND HOW WE GOT TO THIS DECISION. WE ARE NOT REPLACING DECISION-MAKING AT ITS CORE, RATHER POWERING, EMPOWERING OUR CLIENT TO UNDERSTAND HOW WE GOT TO THIS CONCLUSION. ED:
GILA HAYAT, COFOUNDER OF DARROW, NAMED AFTER CLARENCE DARROW FROM THE MIDWEST TO PRESENTED TRADE UNIONS IN ALL OF THOSE HIGH-PROFILE CASES. COMING OUT, JOINING US IS THE CEO OF CHIME. CAROLINE: MEANWHILE, SHINING A LIGHT ON SOME LUCAS SHAW ARE REPORTING.
NETFLIX APPARENTLY GOING AFTER SOME KEY NFL GAMES AROUND THE CHRISTMAS TIME. ONCE AGAIN, IF OURAY IT TO LIVE EVENTS, THIS TIME LIVE SPORTS. INTERESTING TAKE. THEY ARE LIKELY TO AIR TWO NFL GAMES THIS CHRISTMAS DAY IN A LARGE PUSH INTO LIVE EVENTS. THIS IS "BLOOMBERG TECHNOLOGY." SECURITIZED EEO ABOUT TOKENIZED FUNDS LET -- BACKED BY BLACKROCK. THIS IS BLOOMBERG.
ED: CHIME, THE FINTECH KNOWN FOR ITS FEE FREE BANKING SERVICES IS OFFERING CONSUMERS THE OPTION OF ACCESSING AS MUCH AS $500 OF THEIR PAYCHECK BEFORE THEY ARRIVE. CHRIS JOINS ME HERE IN SAN FRANCISCO. IT'S INTERESTING, YOU ARE OFFERING THE OPTION TO DO THIS FOR FREE OR IF YOU WANT TO INSTANTLY, TWO DOLLARS.
YOU WOULD IMAGINE THAT THOSE THAT TAKE UP THE OFFER WOULD VEER TOWARDS THE FREE SIDE TO. MAYBE NOT. WHAT IS IN IT FOR YOU GUYS? CHRIS: CHIME IS ABOUT HELPING EVERYDAY PEOPLE UNLOCK FINANCIAL PROGRESS WITH A FEE FREE CHECKING ACCOUNT AND A HOST OF SERVICES THAT HELP PEOPLE WITH FEE FREE LIQUIDITY. WHAT IS IN IT FOR US WITH OUR NEW SERVICE CALLED MY PAY IS CONSUMERS WOULD SIGN UP FOR CHIME, GET DIRECT DEPOSIT, AND YOU KNOW, THINK ABOUT THE WAY THAT PAYROLL WORKS IN AMERICA, MOST PEOPLE ARE PAID EVERY TWO WEEKS. WITH THIS SERVICE, ANY POINT ON THAT JOURNEY TOWARDS YOUR NEXT PAYCHECK, YOU CAN ACCESS A PORTION UP TO $500. WHAT IS IN IT FOR US IS WE WANT PEOPLE TO SIGN UP AND USE CHIME AS THEIR PRIMARY BANK ACCOUNT. CAROLINE:
BRINGING THEM IN -- ED: BRINGING THEM INTO A BROADER ECOSYSTEM. THINGS ARE A DIFFICULT READ ON THE CONSUMER RIGHT NOW. IF YOU THINK ABOUT THOSE THAT MIGHT HE INCLINED TO TAKE ADVANTAGE OF MY PAY, THEY MIGHT BE UNDER FINANCIAL DURESS, RIGHT, SO IS THERE A TECHNOLOGY IN PLACE THAT YOU USE FOR RISK ASSESSMENT, TO SEE IF SOMEONE IS ELIGIBLE TO DO THIS? CHRIS: FOR SURE, SOMETHING LIKE 60% OF AMERICANS LIVE PAYCHECK-TO-PAYCHECK, WHICH DOESN'T NECESSARILY MEAN FINANCIAL DURESS, BUT USUALLY BY THE TIME YOUR NEXT PAYCHECK IS COMING TO YOUR ACCOUNT YOU ARE IN A LOW BALANCED SITUATION AND THAT IS WHEN BANKS TEND TO TAKE ADVANTAGE OF CONSUMERS. FOR US, GIVING ACCESS TO PAYROLL AT AN EARLIER CLIP IS A HUGE UNLOCK FOR THEM AND STRONGLY -- EXTREME HELPFUL IN GETTING THEM TO THE NEXT PAYCHECK. CAROLINE:
IT'S A NEW AREA OF BANKING SERVICES THAT HAVE BEEN POPULAR ELSEWHERE AND HAVE FALLEN INTO A LEGAL GRAY AREA FROM A CONSUMER PROTECTION PERSPECTIVE. HOW ARE YOU WORKING WITH CONSUMER RIGHTS GROUPS AND GOVERNMENTS TO MAKE SURE THAT YOU ARE ABOVEBOARD AT ALL TIMES? CAROLINE: THAT'S A GREAT -- CHRIS: THAT'S A GREAT POINT. PWA IS EMERGING AND THE REGULATION IN THE AREA IS STILL SORT OF A WORK IN PROGRESS. SO, WE ARE SORT OF MONITORING THAT CLOSELY. WE ARE IN REGULAR CONTACT WITH
REGULATORS AND WE LAUNCHED THE PRODUCT NOT AS PWA PRODUCT, BUT CREDIT PRODUCT, DONE IN COORDINATION WITH OUR BANK PARTNERS. THE LEGAL CONSTRUCT FOR IT IS FOR -- FULLY ARTICULATED IN WE WERE ABLE TO DESIGN A PRODUCT THE SAME WAY WE DID WITH ALL OF OUR PRODUCTS AT CHIME. CAROLINE: SOMETHING ELSE IN PROGRESS IS YOU POTENTIALLY BECOMING A PUBLIC COMPANY. YOU SAID IT WAS AS IPO READY AS IT COULD BE AND YOU ASSESSED HOW THE MARKETS LOOKED FOR 2024. HOW DID YOU LOOK? ARE YOU COMING SOON? CHRIS: THE MARKET LOOKS GOOD, THE BUSINESS LOOKS GOOD, Q4 WAS THE NUMBER ONE MOST DOWNLOADED BANKING APP IN AMERICA. HE HAD 7 MILLION MONTHLY TRANSACTIONS IN THE ACCOUNT. THAT'S USING OUR CHIME ACCOUNTS.
THE MAJORITY OF OUR MEMBERS USED US AS A PRIMARY DIRECT DEPOSIT EVERYDAY SPENDING CARD. SO, THE BUSINESS IS PERFORMING EXTREMELY WELL WITH A PROFITABLE Q1. WE DON'T HAVE IPO PLANS TO ANNOUNCE TODAY, BUT I WOULD SAY THAT IPO IS NOT FAR OUT HORIZON. PROBABLY NOT 24, BUT DEFINITELY SOMETHING WE ARE THINKING A LOT ABOUT. ED:
CHIME HAS BEEN INTERESTING TO ME AND SOME OF YOUR TEAM KNOWS THAT, YOU HAD THIS VALUATION INTO THOUSAND 21 THAT'S NOT UNIQUE FOR YOUR STORY, BUT ARE YOU KIND OF HAPPY ABOUT THAT? WE HAVE SEEN DOWN ROUNDS AND LOWER VALUATIONS SETTING YOU UP WELL FOR WHATEVER FUTURE YOU DECIDE. CHRIS: WELL, VALUATIONS ARE JUST A MOMENT IN TIME THAT FLUCTUATE TO SOME EXTENT. IT'S NOT CLEAR WHAT THE MARKET -- CAROLINE: REPORTED VALUATION, TO BE FAIR. CHRIS: RIGHT. WE DON'T THINK MUCH ABOUT THAT.
WE ARE HEADS DOWN, FOCUSED ON EXECUTING AND NOT AN KING TO SPECIFICS. I THINK THE OVERALL RESET HAS BEEN GREAT FOR US AND WHILE SOME COMPANIES TRY TO FIGURE OUT WHERE THEY MIGHT LAND OR MERGE OPPORTUNITIES WHERE THEY NEED TO RAISE MONEY, WE ARE EXTREMELY WELL-CAPITALIZED. CLOSE TO BILLION IN CASH. WE HAVE BEEN ABLE TO STAY AGGRESSIVE AND GROW MARKET SHARE IN A PERIOD OF DISRUPTION FOR THE CATEGORY, WHICH HAS BEEN GOOD FOR US AS A LEADER. CAROLINE: GREAT TO HAVE YOU BACK -- ED: GREAT TO HAVE YOU BACK IN STUDIO. COMING UP, WE WILL BE JOINED BY THE HEAD OF RUBRICS ZERO LABS.
BE RIGHT BACK. THIS IS "BLOOMBERG TECHNOLOGY." CAROLINE: LET'S TALK ART, CHRISTIE'S MANAGED TO PULL OFF A 50 MILLION SALE, DESPITE A CYBERATTACK. THE APPARENT HACK HOBBLED THEIR WEBSITE THE DAYS LEADING UP TO MAY SALES AND THEIR WEBSITE IS STILL REDIRECTING TO A TEMPORARY SITE SINCE THE SALE BEGAN, PROMPTING QUESTIONS AROUND WHETHER OR NOT THIS NEW YORK AUCTION COULD OR WOULD HAPPEN AT ALL. AROUND THE COMPANY'S HANDLING CONFIDENTIAL INFORMATION, THERE WAS CONCERN. A SPOKESPERSON TOLD BLOOMBERG
THAT CHRISTIE'S CONTINUES TO WORK WITH TECHNOLOGY EXPERTS TO DETERMINE THE SCOPE AND IMPACT OF THE X -- INCIDENT. ED? ED: WHO BETTER TO TALK ABOUT CYBERSECURITY THAN STEVE SET -- STEVE STONE, WHICH RECENTLY PUT OUT THEIR LATEST REPORT CALLED THE STATE OF DATA SECURITY, MEASURING YOUR DATA RISK. I TAKE THIS VERY SERIOUSLY, STEVE, BECAUSE SO MANY CIOS WATCH THIS PROGRAM AND THE CONCLUSION OF THE ROOM OR OF THOSE THAT YOU SURVEYED IS THAT ALMOST ALL OF THEM ARE SUFFERING DIRECT EMOTIONAL PSYCHOLOGICAL IMPACT FROM CYBERATTACKS. I FOUND THAT TO BE ASTONISHING. STEVE: FIRST, THANK YOU FOR HAVING ME, I'M EXCITED TO ENGAGE WITH YOUR AUDIENCE. THE EMOTIONAL IMPACT JUMP OUT AT ME. BUT IT MAKES SENSE.
THERE'S A FEW THINGS. FIRST, THE VAST MAJORITY OF 1600 SENIOR LEADERS OF I.T. AND SECURITY THAT WE ENGAGE WITH, 90% REPORTED HAVING EMOTIONAL OR PSYCHOLOGICAL IMPACT RANGING FROM LOSING SLEEP, FEAR OF LOSING THEIR JOB, OR TRUST IN THEM. WE HAVE SEEN THAT CONSISTENTLY YEAR-OVER-YEAR AND IT SPEAKS TO HOW THIS AFFECTS US AS INDIVIDUALS, NOT JUST BUSINESSES. ED: LET'S TALK ABOUT HOW IT AFFECTS A BUSINESS, TOO, BY PUTTING PRECAUTIONS IN PLACE.
STEVE: THAT'S A GREAT QUESTION AND THE ENDPOINT. WE CAN TALK ABOUT THE PROBLEMS ALL DAY LONG, BUT THE REAL GOAL IS REDUCING RISK. A FEW THINGS JUMPED OUT AT US, IMPACTING RISK REDUCTION AND CHANGING THE DYNAMIC. FIRST, ORGANIZATIONS HAVE TO BE PREPARED FOR CONTESTED RECOVERY. WE HAVE SEEN IT FOR YEARS, IT'S A CONSISTENT TOUCH POINT. YOU HAVE GOT TO RECOVER YOUR DATA AND BE RESILIENT. THE ATTACKERS KNOW THAT AND
THEY WILL DO THEIR BEST TO STOP IT. SECOND PART, LOOKING AT THIS FROM A DATA PERSPECTIVE, YOU HAVE TO INVOLVE A HIGH NUMBER OF TEAMS. THIS IS NOT A CIO PROBLEM, THIS IS EVERYONE'S PROBLEM. ED: QUICKLY, UP AGAINST OF THE END OF THE SHOW, THERE MUST BE A GROWING THREAT AROUND WHAT THEY ARE FACING FROM THE OTHER SIDE OF THE TABLE. STEVE:
I THINK IT COMES DOWN TO A RISK SURFACE AREA WE ARE NOT PAYING ATTENTION TO. HEALTH CARE, IT'S IN THE NEWS. THERE'S NOT A UNIQUE THREAT BUT WE SEE AN OUTSIZED IMPACT. 400% MORE SENSITIVE DATA IS IMPACTED IN A HEALTH CARE INTRUSION THEN OTHER INDUSTRIES. NOT BECAUSE IT IS DIFFERENT OR NOVEL, IT COMES DOWN TO SENSITIVE DATA.
LOOKING AT HOW WE CHANGE THIS, WE HAVE GOT TO START WITH WHERE THE IMPACT ACTUALLY IS. CAROLINE: IS THIS MAINLY THE U.S. OR A GLOBAL PHENOMENON? STEVE: GLOBALLY THERE ARE CONSISTENT THREATS. WHERE WE SEE THE BIG CHANGES COME DOWN TO INDUSTRY UNIQUE ASPECTS.
CAROLINE: STEVE STONE, THANK YOU SO MUCH FOR SOME OF THOSE TACTICS, TAKING US THROUGH THE INDUSTRIES IMPACTED. MEANWHILE, AS ALL THINGS DO, THAT'S THE END OF THIS BLOOMBERG TECHNOLOGY, ED. CAROLINE: DURING THAT CONVERSATION -- ED: DURING THAT CONVERSATION I GOT ADDED ON LINKEDIN BY A LOAD OF CIOS. CAROLINE: DID YOU GET DISTRACTED ON THE
SHOW, ED? ED: I DID NOT. THIS IS ON THE GROUND REPORTING. CHECK OUT THAT RECAP AND ALL THE OTHERS WITH FRANK MCCOURT JUNIOR AND HIS NEW BID FOR THE TIKTOK U.S. ASSETS. YOU KNOW WHERE TO FIND THE POD. SO MANY OF YOU LISTENING TO US AROUND THE WORLD ON THE WAY HOME FROM WORK, YOUR LUNCH BREAK. FROM SF AND NEW YORK CITY, THIS
2024-05-17