Apple, Samsung Behind?: Bloomberg West (07/26)

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July 26 (Bloomberg) -- On today's "Bloomberg West" the focus is on innovation, technology, media and the future of business. Hosted by Emily Chang with Editor-at-Large Cory Johnson and Senior Correspondent Jon Erlichman f26om Bloomberg's San Francisco studio, it showcases the personalities, companies and trends that are transforming the global economy. (Source: Bloomberg)

Looking forward to those numbers.

I am going to e-mail you next week and see how we do on that trade.

That does it for on the markets.

? welcome to the early edition of "bloomberg west" where we cover the global technology and media companies that are reshaping our world.

I'm emily chang.

Our focus is on innovation, tech normal and the future of business.

Let's get straight to the rundown.

Smart founds -- phones and am sung both lose market share in the last quarter as lower cost rivals like l.g. and lenovo gain.

Does this mean the high-end market is shrinking?

Zynga shares fall dramatically after it reveals it won't be pursuing real money gambling in the united states.

With user numbers also down sharply, how can new c.e.o. turn things around?

And why are strausts at the international space station experimenting with a new nasa robot located not in space but here in sill con valley?

We ask a nasa son -- sill con -- sill cone valley?

We ask a nasa scientist.

Cracks are appearing in am and samsung's products.

Both companies lost shares while smaller makers gained.

In the quarter, samsung took 30.4% market share but that was down from 32.2% last year.

Apple's market share was 13.1%, down from 16.6%. that's a two-year low for apple.

Meantime, l.g.'s shares surged to more than 5% from 3.7%. lenovo went from 3% to 5% and z.t.e. also posted a slight gain.

It suggests that the smartphone market is still growing.

We're joined now by john butler, a senior analyst with bloomberg industries.

You know, do these numbers surprise you?

They did a little bit.

The one thing i'd say is i expected apple's share to fall because, number one, you had the s-4 out there from samsung which has been a huge hit.

Then you have some dark horses out there with both lenovo and l.g. doing quite well.

So, you know, for -- from the stand point of apple, the need to get a product refresh out there has never been more pressing, in my view.

And i understand that you just visited a verizon store recently.

You picked up some interesting tidbits about why iphone sales might be slowing down.

Tell us about that.

It's interesting, i did a verizon store visit this morning and i'll give you the warning, it's a one-off store visit.

But what was interesting to me is i was talking to the rep about upgrading to an iphone and she said, you know, they're coming out with a new operating system, ios-7 in the fall, so instead of upgrating in early september which is when i'm due, she suggested that i wait until october for the new i.o.s. to come out because she felt a hardware upgrade would come out concurrently with that operating system upgrade.

I think she's right.

So, that can weigh a little bit on consumers' minds.

You get that sort of wait and see attitude on the part of consumers and it kim pact sales.

It certain -- and it can impact sales.

It certainly has that potential.

What about samsung?

Why is samsung seeing such a drop?

Is it just that the l.g.'s of the world are making better phones these days?

No, one thing to keep in mind is quarter in and quarter out, smartphone unit shipment share can really move around a lot.

I don't want to say it's seasonal, it is seasonal in the sense that the holiday's a big season, but it's seasonal in the sense that different vendors come out with upgrates at different parts -- upgrades at different times of the year that.

Can have an impact.

If a phone is new, it's fresh looking, it's appealing to consumers who can be swayed.

That's one thing i learned in the store this morning as well, is this rep told me that she has been able to sway consumer decision at the point of sale.

She goes, i want -- i always want my customers to keep a very open mind in terms of what their needs are and what the phones are that are available on the market.

It's interesting, l.g. of all companies seems to be the winner here.

What is it about what l.g. is doing right?

Well, i've seen the l.g. phones, i'm very impressed, i have to say.

They have some good devices out there.

And they're coming out with a new upgrade.

They have the -- currently have the g, they're coming out with the g-2, their new flagship phone.

At the end of the day, if you make an appealing device, if the technology is good, the screen's sharp, the camera's good, you're going to take share.

All right.

Bloomberg industry senior analyst john butler.

Thanks so much for giving us that anecdote here on "bloomberg west." always good to have you.

Now to another big story we are following today, act vision blizzard took a major step in toward becoming an independent company again.

Announcing it and the c.e.o. have agreed to buy back most of his stake in the business.

The french media and telecom company had taken a 61% stake in activision back in 2008. what does this mean for activision going forward?

Our editor at large cory johnson is here with this.

Can you give us a little bit of history about how this happened in the first place?

This is really interesting.

Activision has always had important partners on the side of avendi.

But that's a struggling company, activision is doing well.

Avendi's going to get $5.8 billion in this payoff.

This has gone from being one of the sort of second-tier video game companies to the dominant video game company.

If you look at a 10-year stretch of this company, it's really grown, principally on the back of world of war craft, again from a big player to the dominant player in the video game business.

So, in terms of this deal, vivendi's stake goes from 61% down to 12%. they're going to take a lot of cash out of this.

Cash from two sources.

The company's going to buy back a bunch of shares and a group of -- the c.e.o. of the company and co-chairman, as well as some insiders and the chinese company are going to buy 24% of the company.

The tencent part is very interesting because of world of war craft is a dominant part of this company.

World of warcraft has driven the success of this company, along with call of duty and other games.

But this world of warcraft business has really done very well for these guys.

Really helped propel them.

And in china.

In china particularly.

So it's also interesting here to see the sort of dual classes, retiring a bunch of shares.

So the existing shareholders are going to own more of the company.

The outstanding shareholders are going to own about 60% of the company and that means earnings per share are going to go higher because of fewer shares out there.

Who's the winner here?

The c.e.o. is taking the reins of this company again.

Always had very important partners.

In the early days it was steve wynn who helped him fund this company and bobby has always been there at the helm.

I remember talking about this company back, i don't know, 15 years ago, 16, 17 years ago.

You're dating yourself.

I was 3 at the time.

Bobby was 6. put this into context for us.

We're seeing a lot of major shifts in the gaming business right now.

Obviously zynga really struggling as we saw yesterday.

E.a.'s been looking for a new c.e.o. for months.

There are two really -- well, there's three really big trends.

One is the huge growth of gaming.

Gaming in terms of revenue is bigger than movies.

I'm going to say it again.

Gaming in terms of revenue is bigger than movies.

We talk about movies like they're a big business in america.

Gaming is bigger.

But it's a certain population of society.

Principally men of a certain age.

That's one of the big trends.

Then you've got the online trend and that's a really big deal because that's a new business coming up.

We've seen that with zynga and we've seen the struggles.

You've also got this old trend of new consoles coming.

Activision is spending big money on research and development, getting ready for this new refresh in the console business.

The xbox-1, the ps-4. that's all coming out.

That has led to a lot of companies seeing a big slide in sales coming up into this transition period.

But activision has been doing very well in this.

They gave us new numbers about the quarters announced next week and those numbers are really strong.

Cory johnson, our editor at large, thank you.

Zynga has abandoned its plans to bring real money online gambling to the united states.

A business that many hoped would help turn the company around.

But who was behind the decision?

That's next.

? this is "bloomberg west." zynga shares are practically in freefall today, down almost 16%. at one point down the most in nine months, after its second quarters earning report last night.

Zynga did have to resubmit its earnings per share guidance last quarter after finding a typo in yesterday's filing.

The corrected guidance is better than what the company originally reported.

But still, things are not looking good.

Zynga now says it will not pursue a license for online gambling in the united states, a business that many investors hoped would salvage the struggling game maker.

New c.e.o. took the helm so was he behind this decision?

Our west coast correspondent is in l.a. with more.

John, to be fair, donaldson has only been on the job a couple of weeks but people are already asking, what is he doing behind the scenes?

Oh, in a big way.

I mean, you know, the typo just highlighting the facts that tough for zynga to get a lot of things right right now.

The social gaming market, which zynga in a lot of ways pioneered and got a lot of credit for and helped it on a way to a very high profile i.p.o., is a very competitive market.

It's fast growing but zynga has learned that it's just tough to keep up the hits.

And that's what you've seen with these results.

The fact that even though the social gaming market is exploding, the number of people who are playing games that zynga makes and the time that they are playing them for, the trends have not been very good.

And as a result the key way that zynga makes money, through, for example, selling stuff inside those games, the virtual goods, the trends have not been favorable.

And all the c.e.o. can really say is, we're not happy with the performance, i've got to take upwards of two to four quarters to figure out how this is going to play out.

So basically telling people over the next whatever it is, 12 months, things might still be kind of ugly for us.

But i'm going to talk to the team, get everybody focused, maybe try to find a way to get back to where we were, especially with facebook, where obviously they had the early ties and strong relationship and benefits from, where they have seen their games drop off dramatically.

Real money gambling seems like it could have been a big part of zynga's future, potentially a challenging part.

But an opportunity.

Why walk away from that?

This seems -- the messaging from the company is that this is a focus thing.

You sort of hinted at this earlier.

Who is -- whose decision ultimately was it to move away from real money gaming in the united states?

The c.e.o. certainly had a role in it.

If you listen to what he said on the conference call last night.

They make it sound like it was a group decision overall.

But here's somebody who's trying to get everyone focused on something in theory that is a simple idea to get around.

We're pretty good at making games, social games, the market is growing, let's stay with that.

Let's find ways to get better at it.

Let's get ways to get better at it in mobile.

If we're all of a sudden focusing on what's really a totally different business for us, we're not going to have the focus and we don't have that, you know, we're not in a position where we can afford to take that risk right now.

All right.

He's got a tough job ahead.

John, thank you.

Turning now to founders fund, a venture capital firm that was founded in 2005 by peter teal, ken howry and other executives from paypal, over the years the firm has invested in dozens of companies, including facebook, spacex, spotify and others.

Now is a principle -- principal manager.

Interestingly, you have some controversial philosophies.

And the first one i want to start with is that pretty much every investor i speak with says the most important thing in terms of where they put their money is who they are giving it to.

The entrepreneurs.

You don't think that's so important.

Why not?

Well, obviously talent is incredibly important and our founders are heroes but we think that something that is equally as important but very underrated is actually having a pretty solid long-term plan and a pretty solid business strategy for how over time the company is going to defend against competition.

Actually be monopolies.

I would say that relative to business models and business strategy, i think talent is quite overrated today in silicon valley.

You're going to have daggers thrown at you for saying that.

Talent is supposed to be the hoddest commodity here.

It's the currency -- hottest commodity here.

It's the currency.

It certainly makes silicon valley tick and you need incredible people to do incredible companies but one interesting thing to look at is if you look at a place like going where will supposedly, you know, in reality there are tons of very talented people that work there, but if you look at all of the startups started by ex-google employees, the only startup that's become a billion-dollar company was instagram out of all of those startups.

One has to begin asking questions around, do people actually, very talented, wonderful engineers and product managers actually learn the right lessons for starting a company at places like goingle?

So because talent, good talent supposedly is so hard to find, the compensation packages for some of these employees have gone sky-high.

Are people getting paid too much too?

The market determines what people get paid and big proponent of free markets here.

So certainly not going to say people get paid too much.

But i do think that the context shift from going from a half-million dollar package as a midlevel engineer at going toll starting a company and trying to raise financing, i think that's a very difficult context shift for many entrepreneurs to make successfully.

Mr.

are you saying the idea that -- are you saying that the idea the entrepreneur has is more important than who the person?

No.

people have to be talented but have to have a very strong vision and a pretty well thought-out plan early on.

Is it strategy more than the idea?

I think it's strategy more than the idea is what we're looking for, wals as obviously the team and why they're uniquely suited to whether that company.

So what's a strategy that's really excited you lately?

Right, well, typically things that we like are things where there's significant technology risk early on.

Most of these don't like taking technology risks.

So we're fine doing that.

Give me an example.

Something like spacex would be an example.

Tremendous technology risk.

Now the barriers to entry are so significant it's a highly profitable, very successful -- it took 10 years to get there.

What a about a high-speed transport between san francisco and l.a.? that's the type of talent we would invest in no matter what he does.

If we had the opportunity to invest in him i'm sure we would look at doing that.

What about snapchat?

That's probably a good example of a company where there's perhaps not a very strong long-term business strategy.

So, it's the type of thing where it seems to be working.

For us it's not enough if it's working and getting users, we want to know how that company's defensible long-term.

Snapchat, is it overrated too?

We would not have invested in this last round had we looked at it.

The jury is still out.

Hopefully they'll come up with a really defensible business strategy.

Yet, you invested in a company like lift.

What is so big about lift?

I like those guys, i think it's an interesting idea, but is it going to change the world?

We believe that it will.

Pier to pier is a difficult business than black cars and taxis.

We think that with lift it's a more for less story which is very compelling.

It's a better experience than taxis and for many people black cars.

Significantly cheaper and we think peer-to-peer will win transportation in cities and that lift is going to win peer-to-peer.

Are the pink lips going to live on forever?

The founders have done a wonderful job on branding.

We trust our founders.

We'll see what happens.

All right.

Jeff lewis, thanks so much for joining us today.

Still ahead, how astronauts in space are now able to operate a robot right here in silicon valley.

That's next.

? welcome back.

I'm emily chang.

Today nasa tested how astronauts in space can remotely operate a robot on earth.

Astronauts aboard the international space station remotely controlled a k-10 robot at nasa's research center right here in silicon valley.

My partner cory johnson spoke with nasa society chief for space exploration david about today's test.

He started by asking, why we need astronaut-controlled robots at all.

Well, there are certainly circumstances under which that would be very difficult.

As you get farther away from the earth, the time it takes for a signal to go back and forth becomes extremely long.

And in certain cases it would be too long to perform any operations.

So as we get farther away from the earth, we need to have more you aen tomy and capability to do things locally -- you aen tomy and capability to do things looky.

-- locally.

As a certain robot questions or robot research that nasa's able to pursue that maybe a business wouldn't right now?

And what would those be?

Well, we certainly have access to an orbiting laboratory, 250 miles above the earth.

We have access to a great deal of instrumentation and we do have quite a few partners that work with us in industry and in the university community on this work.

So it is a shared work and not exclusive but we have resources available as part of the space community that are not widely available at this time.

That was nasa's david with our editor at large, cory johnson.

It is time now for on the markets, a look at what's moving in the markets at every hour.

Thanks.

Taking a look at stocks today and we are seeing decline, although the nasdaq now is in the green.

But people have been trying to weigh earnings news.

We also got a consumer confidence report this morning that came in better than economists estimated.

That wasn't helping markets initially but now we're seeing a little bit of a turnaround at least.

Despite what you see in the nasdaq overall, technology not doing fantastic today.

Expedia coming out with earnings that mists analysts' estimates that.

Stock dropping the most in seven years.

It is down by 26% right now.

Also we're taking a look at the chip makers today.

A couple of different pieces of news.

Samsung coming out with disappointing results and there's concern about higher-end smartphones in particular, demand for those, and for the chips that go into them.

By extension.

So that piece of news changing things.

There's going to be weakening demand for flash memory chips tying into the smartphone story.

And cirrus logic came without with disappointing results as well.

All that have weighing on the chip makers today.

That's a look at what's moving the markets right now.

We'll be back with more on the markets in 30 minutes.

But you'll have more of "bloomberg west" just after the break.

Stay with us here on bloomberg tv.

?. this is the early edition of "bloomberg west." i'm emily chang.

You can also catch us later at 3:00 p.m. pacific, 6:00 p.m. eastern.

Now for a check at stories making headlines outside of technology.

The driver of that train that crashed in northwest spain has been detained and could face criminal charges.

Investigators are examining the train's data recorder and believe that excess speed may have caused the train to go off the tracks.

At least 78 people were killed and dozens more are still in the hospital.

Attorney general eric holder has told the russian government that n.s.a. leaker edward snowden in will not face the death penalty if he's returned to the u.s. to face chargers.

He also said that snowden would get a public trial and not be compelled to answer questions.

The u.s. is trying to persuade russia to reject snowden's request for asylum.

He's been living in the moscow airport for more than a month.

The house ethics committee is launching a formal investigation of congresswoman michelle bachmann.

The probe is focused on the minnesota republican's short-lived presidential run and whether she improperly used campaign funds to pay staff.

The committee is also launching full investigations of democrats john teerny and tim bishop and republican peter ross come.

In today's new hollywood, hbo has a message for netflix.

Bring it on.

Hbo expects addressed increased competition from netflix.

We were there and caught up with hbo's c.e.o. hbo seems ok with some healthy competition.

Yeah.

They say they've been living with it for a long time.

This is just a new variation on that.

It is a really interesting time for hbo because netflix has been dominating the headlines, most recently with getting all those emmy nominations which made people wonder, boy, what does this mean for an hbo in terms of, you know, maybe more talent, directors and actors and producers wanting to do shows for a netflix vs.

An hbo.

But this is also a time where we have to focus on the hbo financials.

Here's a company that has never been as profitable as it is right now.

Or generating as much revenue or enjoying as many subscribers, about 115 million globally, that it has.

So it's pretty easy for a guy like the c.e.o. to address these kinds of issues.

When i asked him about sort of the brand and how it's doing right now, and the competitive landscape, here's the quote from him -- it is a competitive landscape but we've always existed in a competitive landscape and all that means for us is play our game as well as we can play it and he went on to say, if they do that, they're going to get their fair share of talent and their fair share of accolades.

Hbo has had success with hbo-go which allows people to watch hbo on devices, if they're capable subscribers but did he say anything about hbo being available outside of cable like netflix?

They do like to dance around those questions.

But while they have tried that in scands navia, for example, changes to -- scandinavia, for example, changes like that in the u.s. seem unlikely.

Hbo-go has been very successful for them.

So if you are an existing cable customer, you get the kind of access that netflix customers have been able to enjoy.

But also just coming back to the profitability that hbo has enjoyed, the fee is that the cable players, the paid tv providers, are willing to pay hbo to make sure they can offer it are massive.

And they're going to be more -- there are going to be more negotiations likely over the next 12 months with some of those paid tv players to ensure that hbo stays well within that cable family.

So financially if the cable companies are making it worth their while and people still want to watch shows like "game of thrones" that kind of answers the question at least for now.

All right.

Thank you.

If you're searching for a perfect summer vacation and don't know where to start, peek may be able to help.

It's a travel site that gives users insider tips on where to eat, shop and visit in some of the world's top hot spots.

Here in san francisco the team has comed -- the company has steamed up with some of tech's biggest names.

They gave me a peek into how the site works.

Ever wonder what twitter co-founder does in his spare time?

Well, thanks to a new travel site called peek, wonder no more.

Peek sells online excursion tickets, things like boat rides, museum tickets, a tour on a sea plane.

But they also invite local a-listers to share their favorite itineraries.

That's how we know for him, a perfect san francisco day includes a walk across the golden gate bridge.

Peek's c.e.o. took me along for her own ideal day.

Stop one, the fairy building -- ferry building.

Ok, so you can't start a perfect day in san francisco without some blue bottle coffee, right?

Absolutely, we're knit right place -- we're in the right place.

So what exactly is peek?

Are you trying to replace travel guide?

We're not for replacing the travel guide but we're making them bookble.

Peek is a one-stop-shop for people to book amazing things to do.

Drinks in hand, we head to our next stop.

So nice to meet you.

Welcome.

We're hungry.

Are you ready to make some pizza?

We are.

Let's go.

All right.

Ready.

I'd always wanted to take a pizza class but never knew how to find a good one.

Peek staffers work with locals and travel experts to find hidden gems like this place.

Peek takes a 20% cut on each sale.

Travel is a crowded field these days with everyone from expedia aiming to help every traveler feel like an insider.

But peek's model seems to be resonating with local businesses.

How long you have guys been on peek's list?

We've been on for over a year now and it's been really nice to see people from out of town who don't know about us.

They read it about it on peek and they take our classes, they tell their friends, it's been really great.

And it seems like things have been going great for peek too.

They've gotten investments.

Back in class, lunch is ready.

Mm.

and then we're on the move again.

So, chinatown.

Yes.

We have a walking tour of chinatown.

This is one of the classic favorites.

So is peek in china?

We're not in china but we are in europe.

So we've just launched in london and paris.

I'm from hawaii so i checked out your hawaii pics and i noticed there are some hidden gems there that i didn't know about but there are some that aren't on there.

We'll need to get you to do a perfect day for hawaii.

I would love to, i would love to.

And i did give peek a peek into my perfect day on the north short of can waughy.

Complete with food and dolphins.

Finding a place to stay in asia just got a little easier.

We're talking to the c.e.o. of homeaway about their growth in that region next on "bloomberg west." you can also watch us streaming on your tablet, phone and bloomberg.com.

? welcome back to "bloomberg west." i'm emily chang.

Vacation rental site homeaway is growing globally, exchanging -- expanding its reach in asia.

The global expansion comes just after the austin-based homeaway reported strong second-quarter earnings, up 21% from last year.

The c.e.o. and co-founder of homeaway joins me now from austin.

Let's start with this asia pacific strategy.

How do you see this playing out?

So we started investing in the asia pacific region a couple years ago, in 2011, we acquired a company in australia and last year as you mentioned we made an investment in what we think will be the leading vacation rental site in china.

And then we just announced this week that we acquired a company called travel mob, it's a relatively new can be, it's only about a year old, but they're operating at about -- in about eight asian markets and have had a lot of success.

It's a really strong team out of yahoo!

And skype.

Venture-backed company that's now going to be controlled by homeaway.

We're very excited about it.

It's a big part of the world.

There's something like 100 million people a year in southeast asia that are joining the middle class.

And those people are going to be buying second homes and they're also going to be traveling.

So that should be very good for homeaway's business.

Now, let's talk about china in particular.

This is a really tough market to crack.

Facebook and google not the least of which are among the companies that have tried and failed in china.

What makes you think that you can succeed there where other tech companies have failed?

Well, i think you make an excellent point.

And truth be told, we actually studied a lot of those failures before moving into china.

And so the reality in china is that we have a minority position in a chinese company that's operated by chinese locals and funded by chinese venture capitalists.

Rather than taking our company and going in there and expecting that we could create homeaway in china, instead we went in and identified a company that we thought was in the best position to win and then because we have global access, they welcomed us in as a partner.

Because every travel site, whether it's hotels or whether it's vacation rentals, ultimately benefits from having global inventory.

While this company was building inventory in china, we're now able to give them inventory from all over the world and we're able to add their chinese inventory to our sites and all the while own a piece of a business that, you know, may be very attractive from an equity standpoint down the road.

So how many more acquisitions are we going to see you do?

And just in asia or beyond as well?

Well, we've concentrated some of the effort most recently in asia but there's still quite a few parts of the world that we're not in yet.

We have a big position obviously in the u.s. and europe.

But let's take latin america for a second.

Huge market in latin america.

We do operate the number one site in latin america, but it's really brazil only so we have the number one site in brazil.

So we just opened in colombia.

We're about to open in argentina.

And there are acquisition opportunities potentially in some of the countries there.

Eastern europe is another part of the world where we don't have a big presence.

So this recent deal with travel mob does get us into markets like india but, for example, it doesn't get use in russia.

And so there are potential opportunities there.

M&a has always been a big part of our strategy.

It continues to be a big part of our strategy going forward and we're just going to be opportunistic.

We look at every country as an opportunity to expand.

Sometimes it makes sense for us to go in there ourselves and sometimes it makes sense for us to buy a business.

Now, homeaway shares are down today about 7%. and it seems to be because growth in new listings is lowing -- is slowing down.

Should we be worried about that?

Well, we've been talking about it for a few quarters.

Actually growth in listings on an adjusted basis was actually up is he consequentially quarter over quarter but it's a little bit lower than what my personal obbletive is.

We'd like to see them growing at a 15% annual rate in the business.

They're growing at about 10% right now.

One of the big strategies we have in place to really get back to the levels that we like to see it at is that in the third quarter this year we'll be introducing a new type of product.

Today if you want to list a property on homeaway, you've got to pay up front an annual fee to do that.

We will start in the third quarter introducing a product where you can come onto the site for free and instead of paying a subscription, you pay a percentage of revenue as your property gets booked.

We have a very high expectation that this is going to be a bring a lot more properties into the homeaway universe.

We've talked about air b&b. it's of course part of your primary competition.

A lot of talk about them potentially going public very soon.

Any concern that when air b&b comes out of the gate it could attract some of your investers?

You know, i personally can't wait to see air b&b go public because there's certainly a lot of mystery around the numbers and i think in particular the profitability of that business.

It's a private company, it's pretty closely held.

There are rumors about valuation.

But nobody will really know the true potential of that business or the true value of that business until it either gets sold to somebody or the company does go public.

So, we're looking forward to it.

There's still -- they're still in a very difficult space than ours today.

We love them and wish them well and i think they'll be good competitors to have.

Thanks so much for joining us today on "bloomberg west." more "bloomberg west" in just a moment.

? this is "bloomberg west." i'm emily chang.

Computer chips are getting a whole lot more personal.

Now diving inside your body.

We take a look at the emerging world of injectble electronics.

Wearble electronics like google glass and jawbone are the hottest gallon ets in the tech world but now electronics are pushing past that.

A market of ingesti believe electronics has emerged -- in jestible electronics has emerged.

This is a thermometer pill that when consumed wirelessly transmits core body temperature as it travels through the patient.

This technology was originally developed for nasa in the 1980's but now it's cheaper and smaller.

And as a result more than 150,000 pills have been consumed by people whose jobs regularly expose them to high leets like firefighters, soldiers and athletes.

In fact, core temp is one pill lance armstrong willingly acknowledged taking.

Video blogging the entire experience.

I'm going to swallow some thermometers that come in the form of a white pill.

It has a built-in battery.

The average price for one, $41. three times the cost of a conventional they were but it is reusable.

-- of a thermometer but it is reusable.

This is this contains a computer chip the size of a grain of sand.

All right, this is how it works.

You take the pill, which then connects to a patch, which then transmits data to your smartphone.

Your grandmother's in florida, you're in new york, you want to make sure she's following doctor's orders, taking her meds, getting exercise.

With this pill, you know all that from the updates on your smartphone.

And instead of containing a battery, the pill uses a patient's stomach acid to generate electricity.

So it's literally powered by you.

It has already raised more than $62 million in venture capital.

Just because these electronics are digestble doesn't mean the idea of them is easy to swallow.

"bloomberg west" will be right back.

? welcome back.

I'm emily chang.

Coming up on the late edition of "bloomberg west," 3:00 p.m. pacific, 6:00 p.m. eastern, moving streaming service is teaming up with live nation.

Users will now be able to listen to audio tracks while buying concert tickets.

Will the partnership give r.d. io the boost it needs -- rdio the beast it needs to compete?

We'll see.

And it is time for now on the market to look at what's moving in the markets every hour.

At 26 and 56 after.

Our senior correspondent is in new york.

Thanks.

Take a look at where stocks are trading.

Remember we saw really uniformly lower market earlier.

And it continues to be that way, although the nasdaq was green briefly earlier.

Now it's sort of flirting with that level one again, little changed.

We've seen a lot of movement on earnings.

That seems to be what investors are continuing to focus on.

So let's start with newmont mining in terms of movers we're watching today.

The stocks came back a little bit.

It fell earlier as much as 4.8% after they reported a surprise loss.

In the past two months, gold mining companies have announced at least $15 billion in writedowns.

Plus, natural resources, one of the biggest movers in the s&p today.

The reason for that move, the company reporting better than expected second quarter earnings.

Strong coal and iron or shipments helping revenue company in -- come in above estimates.

And this is a company that distributes drugs and also other types of health care equipment.

Earnings per share beating estimates and the company raising its forecast as well.

Now let's turn to the broader economy and what element that didn't move the market that much, surprisingly enough, and that is consumer confidence.

Coming in above analysts -- above economists' estimates i should say and at the highest level we've seen in six years.

Here to help us break down what this means is our economics editor.

It seems like the expectations going into this summer were quite low and yet it came out above estimates.

There seems to be this malaise in terms of us talking about the u.s. economy.

But consumers feel ok?

What's going on?

They seem to feel a little bit better all the time and it isn't exactly clear why.

These indicators this one in

This text has been automatically generated. It may not be 100% accurate.

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