Live from pier 3 in san francisco, welcome to the late edition of "bloomberg west," where we cover global technology and media companies reshaping our world.
I'm emily chang.
Our focus is innovation, technology and future of business.
Twitter ups the price range up $25 a share and sources tell us it's three zayed overprescribed three days ahead of perspective trading.
Blackberry points a new c.e.o. after a collapse of a 4.4 billion deal to keep the company private.
Can the new chief engineer a turnaround or is a breakup in the cards?
Netflix makes tv shows.
Are original movies next?
Find out why it has sights set on the big screen when we speak to the chief company officer.
First, the lead just days ahead over the most anticipated i.p.o. tech since facebook, twitter raised its prices from goods 23 to $25, up from range of $17 but even that may not be high enough as two people with knowledge of the matter tell bloomberg it's already several times overprescribed and bloomberg news reporting underwriters will start taking orders at noon tomorrow.
Ahead of the time pricing wednesday.
$25 a share, twitter would raise about $1.75 billion in the i.p.o. at market cap of up to $17.4 billion.
Our editor at large cory johnson is here with more in the drill-down.
Earlier we talked about 13.5 billion potential valuation.
13 1/2 billion.
Now you're saying it's more like 17 1/2 billion.
How do you come up with that number?
It's not just math.
Do stock options exist at this company?
Are their existing share grants that will be invested as executives stay?
If you assume the company will be around for a little while, then you have to assume these options vest and some of these restricted share grants are included.
If you use the fully diluted share count, you can use the 17 billion valuation.
I think it's more appropriate than the assumption they will never issue -- the options they have will somehow expire the worth and numbers go up.
But the fully diluted number, i think that's the appropriate number for the full market cap, which says it will be a great, big market cap if it's over $25 a share.
If indeed it's overprescribed above $25 a share k. we see the price go further wednesday when they price?
We certainly could.
One of the things we have to think about what's happening behind the scenes, goldman sachs, running the book for these orders, is trying to say who will buy these shares and not quickly unload them so we don't have a deal that breaks its price, falls below its offering price?
Famously with he that happen with facebook but crummy i.p.o. breaks its i.p.o. price and it's hard to recover.
Goldman sachs doesn't want this.
That said some of the tricks of the trade from prior years and prior decades even where they would, for instance, insist that the people buy the shares, not sell or go out and buy shares in the after-market, they're not allowed to do that anymore.
How important is an i.p.o. pop?
First, we don't want them to drop.
They don't want to drop.
The first thing is the line of appreciation of value that seems to work for everybody.
But that doesn't tell us anything about the fundamental business underneath but what it does do is says -- depends what kind of company.
Enterprise company likes to get attention for the i.p.o. but this is a company that has most of its business overseas.
Not everyone on twitter will be paying attention to twitter i.p.o. they likely won't gain a lot of new business because of twitter i.p.o. with all of that business overseas, the less focus on the pipe most of their customers, i think it's not as big a deal for these guys.
They want to raise money.
So 2,500 valuation, they will bring about a billion 7 into political coffers, top of my head i recall about $300 million they have in cash sofment they're losing money.
They're burning through free cash flow.
They will still be in a better position to do the things that will help them gain users and grow their business.
I know you have been crunching numbers from updated filing.
What new things are you see something new things to me are not as important as old things.
I understand old things.
Looking at the user growth and slow-down in user growth, one of the most important things investors have to figure out and this is another existential, theological question -- do you believe in a universe with 2.4 billion people on the internet, it's a good thing twitter only has 232 million?
90% of the people on the internet have chosen not to be on twitter, is that good or bad?
If you're a pessimist, like me, you feel like it why can't these guys penetrate the big market in front of them?
If you're an optimist and say they're going to get there.
Their slow growth rate will pick up again and they will get to the big user growth.
As they went from 11% user growth to 6.4% user growth, that will turn around.
Will get the other 90% of the internet.
This is within one of the things i.p.o. forces people to do, decide what the future will be and ow hospital mystic they're willing to put their dollars to work.
We also learned ibm is suing twitter for patent infridgethment.
They only have nine patents, most other companies, facebook, had more than 700 when it went public.
How big a problem is it twitter doesn't have many patents at all?
As a matter of fact, the biggest patent creator out there, ibm, sued -- i'm sorry, informed them they think three -- they're in violation of three patents and i posted each of the patents online.
It's interesting to see people reacting on twitter to my post about what those patents were because they seem incredibly broad.
Don't think this is the last patent problem twitter will face.
Cory johnson, our editor at large.
Clearly, the napped for twitter's i.p.o. is building but is the company taking any risks in boosting share price?
The president and editor of i.p.o. desktop where he can adjust prevaluations.
He joins us from culver city, california via skype.
What do you think about this price.
Any risk twit core follow in facebook's footsteps?
No, i really don't think so.
I think even if you look at $20 billion market cap, that would be price $3700, i think tomorrow will trade between -- wednesday, trade between $35 and $40. if you look at user growth, which is interesting, facebook's user growth really the last year and a half hasn't been that much.
A billion user and now a billion three.
What happened with facebook they figured out how to monetize their user and worked with a mobile campaign and extra revenue sources.
I think the same thing with twitter that will happen is they have the three main revenue sources, promoter traits and trends and other one, eight new revenue sources coming out.
They will work with the nfl.
Sub service advertising platform, go after the international and then they have the other revenue generators.
I think all of that could come together and play very, very nicely.
They had a deficit going into it of $866 million.
They need the i.p.o. proceed to make their business happen f you look at valuation and look at the great of growth for the six months ending june of this year and compare with facebook and linked in, twitter had 54% growth.
Linked in 42% and facebook 34%. so in terms of the top-line revenue growth comparative bases, which is really important, they have a higher revenue growth.
Also, their charter range is five times 35% to 40%. their growth margin is 63%. target there is high.
Facebook is 73, linked in like 88. so they have a really good, aggressive income targets.
And i think when everything comes together, it will be fine for them.
Any concern about what cory mentioned earlier, twitter's operating costs are rising fast er than sales?
They're paying a lot for r. & d and talent?
They're building revenue streams.
Eight introduced since may so that takes a lot of effort and they're expanding, self-service, overseas advertising.
What they're doing is betting the farm.
I think it will work out ok for them.
What do you think they should use the money they raise for?
Where would this money be best served?
It would be best served to implement their plan, which is to flush out their revenue stream.
A lot of people think the employer is 140 but it's a lot more . when growth line and top objectives, it's a lot more.
They're increasing top line revenues to get margins up and underneath the compound increase in sales, that will be very impressive.
Now, say twitter prices at the high end of the range or even slightly higher because it is oversubscribed, what do you think the chances are of a stock pop versus drop on the first day of trading?
I personally think it's there's 100 chance of stock pop, not a drop.
What's happened is, i was checking with some of my investment friends over the past three, four weeks and four weeks ago said twitter is just a tweet platform.
It's a lot more than a tweet platform.
I think with facebook, there the taxicabs in new york, drivers talk to you via facebook.
Everybody knew facebook and what facebook was about.
I think twitter has a lot under the covers.
They will be revealing a lot.
And people don't really understand twitter, or the revenue model.
And that's where it's good toll become public and people not to totally understand it.
The other side, however, all of the social networking stocks that came out in 2011 piqued in their first hour, except maybe linked in, had did go down and came back up.
Don't know if people should rush in and buy it.
People could get overly enthusiastic and it's only a billion seven -- i feel not very much.
Which would not take a lot of extraneous users to pop it.
I think tomorrow, thursday it will trade 35, in the 35 to 40 range unless something else happens.
Pot is boiling for twitter.
We have president francis gas kin, thank you very much for weighing in here on "bloomberg west." still ahead fairfax's bid to take over ablackberry has fallen through and smartphonemaker has a new boss.
What is next?
You can watch it streaming on your tablet and phone.
I'm emily check and this is "bloomberg west" on bloomberg television and radio, streaming on your phone, tablet and at bloomberg.com.
Fairfax financial's $4.7 billion buyout of blackberry has fallen apart and company's c.e.o. thorsten heins is out of a job.
Chen is taking over at executive chairman, which puts him in charge of blackberry strategy.
We have been following the story closely and joins us now from new york.
Christina, why couldn't blackberry seal a deal with fairfax when the head of fairfax is blackberry's biggest supporter?
He just wasn't convincing enough is what it comes down to, especially when it came to equity investors and even bankers on this deal shy add way.
They did not hear the conviction in the turnaround.
In fact, they didn't hear a turnaround strategy at all.
What the new deal is they managed to negotiate here is a billion dollar capital injection, effectively buying some time for the company to maybe turn itself around, bringing in new management, buying some time to spruce it up maybe down the line selling it for much higher price but reality is, the market is not factoring a deal in the short term.
We saw the stock tank today and that's because the market will be keenly focused on the cash position of the company.
Blast quarter we saw a drop in cash of about $500 million.
The market is now looking at whether or not blackberry could stay afloat long enough to really execute on this strategy and it's looking a little bit dire for them right now and that's part of the reason the company felt a little bit rushed to get a deal done, get something announced today.
Is there any word whether we can get another offer to take blackberry private?
I mean, i know a lot of names have been floated out there.
Any of these guys serious buyers?
Yeah, one name that you know for sure is lazz reedous.
He was teamed up -- lazz receiptous, cofounder of blackberry, teamed up with qualcomm on a joint bid and possibly canadian element which would have boded well but in a statement today we hear the company is ended its strategic review that.s0 means it won't be sharing information with any perspective buyers so it seems like a deal in the short term will be very difficult to pull off and this is not the kind of situation where want to go hostile because you need the information from the company to really put a value on it and assess the risks here.
And christina, blackberry we know is getting a new c.e.o. what do we know about john chen?
I know he's a turnaround guy.
But does he have what it takes, obviously a very difficult situation.
Look, he can it at sybase.
He came in with a company that was very -- struggling and that sold it for six times more than the company was worth when he came in.
So he has a trock record.
Keep in mind, emily, it took him ten years to do that, 10 or more to do that.
So it's going to be a long haul for blackberry if they're successful.
Definitely a challenge here.
First off, they have to stop the cash bleed.
They have to make sure that customers are actually buying their products.
That's number one effort day one.
Our bloomberg reporter christina alesi, thank you so much.
We will be watching.
Netflix original series "house of cards" was a hit but can the streaming service repeat that success with original movies too?
We ask netflix chief content officer in an exclusive interview next.
Welcome back, i'm emily check, and this is "bloomberg west." catch our early edition 10:00 a.m. pacific, 1:00 p.m. eastern.
As many watch mobile devices, even cutting cord with sable and satellite providers all together, dish network chairman and founder charlie ergen is trying to position his company as force in mobile broad band.
Al hunt sat down with ergen for an exclusive interview and asked him how dish is competing for viewers outside of the living room.
If you're in some other part of the house or traveling, you will be watching video on tablet or phone, maybe a larger phone.
Maybe a smaller tablet, and we're just going to try to make that easy for you and you're going to have every piece of video probably that ever has been produced, probably going to be at your fingertips.
And that's one reason we would like the spectrum because if you want every piece of video ever produced, it will get to a tablet or phone and have to be wireless.
Catch the full interview on bloomberg.com.
Well, netflix may be gearing up for big move into the movie business.
The company's chief content officer ted sarandos turned our "bloomberg west" correspondent john ehrlichman the streaming service is "completely open-minded about the size and scale of the films it could make." john joins us from l.a. with more on that exclusive interview.
John, netflix ambitious as ever.
Sarandos certainly seems to be laying the groundwork for original films beyond documentaries.
Sarandos also made headlines a week ago for suggesting movie theater owners are stifling innovation.
I started by asking about the feedback he's been getting from those comments.
The speech was to a group of independent filmmakers.
The speech was in praise of television and the fact that because of -- partially because of the really innovative distribution models the tv adopted, some of the most amazing work in the world is being done in television.
I feel like what's happening is that there's a television is displacing movies in the culture in a way.
The way you sit around and used to talk about movies, most people are sitting around talking about "breaking bad" or whatever they're watching on television now and distribution model by taking all of the risk out of missing something is one of the things that are fueling it.
I made the comment that in contrast that most major motion pictures are distributed in the exact same way they have been for years, which is this long window between theater and first exemployment ace of individual yo or d.v.d. and meant to contrast what's happening on television.
It should be noted i love going to the movies and i love the theater and i want calling for day and date with netflix.
I was calling to move all of the windows up, get close tore what consumer wants.
Really, our 0 whole drive at netflix is innovating on behalf of the consumer, getting consumer closer and closer to what they want.
I think there's a better business in giving people what they want then creating artificial distance between the product and consumer.
And to answer your question, i have had mostly great feedback from people who said we have been having this conversation for a long time and no one wants to say it out loud and from theater owners mostly i heard from john directly, no theater owner directly.
To your point, there have been a lot of people who have been saying there's a need for update or change in terms of how this process works.
If you're a movie theater owner, what would you do looking at all of these ways that seem to be attacking your business?
Our business is hard enough.
I wouldn't want to try to run a theater's too.
But the one thing i would do is say, the overarching one is if you know what your customers want -- and i think everybody kind of universally agrees earlier access to the movies and models besides getting in the car and driving to the theater, particularly a huge chunk of the population there's nowhere near a theater showing most of these films, that being able to accelerate access to them is going to be in their favor.
And figuring out how to monetize that in a way would be helpful.
The comments that you made coupled with comments you made on company conference call make it very clear you are thinking about netflix's next step possibly with movies, even today you guys acquired a very hot documentary.
If we think about this possible move by netflix into, you know, film as we think about it, big films, hypothetically, if you guys were going to make a film that cost, don't know, $20 million, $100 million, what would be the process?
Is this something you would distribute only through netflix?
Something you would want to distribute through the theaters?
Was if there's a 3-d component?
All of these things serve curious about now.
I sthead and i'm repeat -- said that and we're repeating it, keep our mind wide open in terms of what these projects would look like.
The range of our original series have been quite broad in terms of what kind of shows, how much they cost.
I imagine this would be as well.
Certain films i do think have a natural theatrical component, as you say 3-d. something you can't do at home.
And there are plenty of experiences, seeing gravity in 3-d is a phenomenal sprns in a movie theater but most people will see it in 2-d at home.
So i think that there's no reason these have top happen six months apart.
As we explore these things if these things have a theatrical component, we, of course, would seek screens for them to be out there.
Just offer more choice.
You guys are actively looking at film projects right now, is that -- yes.
We have been looking at a lot of projects.
Do you feel like you have found something that might be your "house of cards" in a movie version?
I would say we're not at a short list yet.
No short list.
But looking completely open-minded about the size and scale and scope of what they could be.
And as for netflix's plans for original shows for tv, vandous said he expects there will be a third season of both "house of cards" and "orange is the new black." emily?
John ehrlichman, thank you.
We will have more of the exclusive interview with ted sarandos on tomorrow's early edition of "bloomberg west." coming up, ipad air hit stores this past friday.
While apple hasn't released any official numbers, what company's data points to a successful debut weekend.
We will explain next on "bloomberg west." you're watching "bloomberg west," where we focus on technology and future of business.
I'm emily check with your bloomberg top headlines.
Google is upping its investment abroad to help the search giant cope with the growing demand for mobile videos.
Google plans to spend $408 million to expand its finish data center, writhe that has stable electricity grid and chilly climate, which helps the company save on equipment cooling costs.
Nokia agreed to extend its patent licensing agreement with samsung for five more years.
In return samsung agreed to beef up its compensation.
The agreement is boon for nokia, which tries to rebuild revenue.
It sold its handset division to microsoft back in september.
And frequent flyers rejoiced last week when the faa announced it will ease redirections on the use of personal electronics during flights, allowing passengers more time on their devices.
Amazon is trying to cash in on the news is with one-day sale today giving 15% discount on its kindle tablets and readers.
Could health care.gov tech headaches been prevented?
I asked former white house c.t.o. anise chopra earlier on the early edition of "bloomberg west." he told me he expects the government to further examine the cause of the site's problem scomblfment it will take time to review all of the reasons why certain aspects fell short and i think there should be a thorough review and that will be something the president will call for.
Government contractors have pointed to limited site testing as part of the problem, testifying that the government ran tests days instead of months before health care.gov was launched.
They see web partner technology hot spot for investment.
The firm invested $30 million in a company that analyzes desktop and mobile sites to predict when and where they may have outages.
The general partner ibrahim join mezz in the studio.
The question is why didn't they test longer?
Isn't that like expense?
They were in a rush.
They needed to get it out and we understand that.
Most consumer-facing websites have a pressure, whether it's because the commerce site need to get out before cyber monday or just generally need to launch.
It's just most sites have -- most large sites have millions of users pinging that -- pinging the site at a given time and in this case, it clearly they didn't do enough job -- are we being too hard on them?
When apple rereleases a new version of i.o.s., the president mentioned it, there are glitches.
Same with microsoft and windows.
Should we not expect so much from the government?
We have to expect more of our government and i think that they have done a poor job.
Unfortunately, they disenfranchised a lot of health care insurance providing health care insurance buyers.
And it's just an unfortunate thing.
Had they gone ahead and tested this, like with companies like what stosa does, it could have done a lot towards correcting the problem.
Unfortunately, they had a deadline and clearly made short cuts.
Tell me about this company called stosa.
It's a company we have seen funded about seven years ago.
They now have 400 enterprise clients including some of the largest retailers and e-tailers out there like target and walmart and nike and this is exactly what they do.
They help companies like these ee-tailers and enterprise software companies test these sites, make sure that they work not only with the traffic bursts that you saw with health care.gov but also geographically have the performance that we expect all of our sites to.
And most of the testing is predictive, right.
How much can they really predict?
It is predictive but at the same time we're using the same servers that most of these cloud-based sites are using across different geographies, whether the united states or europe or asia.
And at the same time we're testing on mobile devices.
So we don't think that problems like what you saw occur with health care.gov should occur.
So what do you think other than testing, what other problem -- what else could they have done better?
It's clearly an organizational issue where there's too many cooks in the kitchen and when we look at our start-up, this is one of the reasons why start-ups can operate more efficiently than big organizations.
They just have a singular purpose in mind and had they had that as opposed to having multiple parties at the table, this could have been prevented.
Having said all of that, most of the mature consumer-facing companies, they look at this and say we need to perfect our performance down to the millisecond.
That clearly not what the government was intending.
They wanted to get it up and rung.
As i mentioned, i was speaking to the former c.t.o. of the white house chopra earlier today and i want to you listen to a little more of what he has to say.
Big projects of this sort in the public and private sectors that have had challenges is not unique to this particular one.
I like everyone else, am frustrated at the pace in which these challenges have come forward but i'm very confident that with the leadership of the team they assembled, they will work through these issues.
Now, you know, we're hearing that they're continuing to work on it.
Some of the criticism has been look, the white house is incompetent.
Some of it has been maybe they haven't moved into the digital age as much as president obama is considered a tech-savvy president.
You know, what do you think the real problem is?
It's classic crossing the chasm stuff, right?
You have big organizations, whether it's the government or whether it's ibm for that matter.
Big organizations trying to tackle a big problem.
And they tend to take it in very large chunks as opposed to the start-ups in silicone valley, which do things in small, focused ways.
Now finally the government has gotten this feedback that the site has gone down or been too slow, they're putting the right people on the job.
It's just that it was probably too ambitious of a project to begin with.
You think the government is capable of taking on the mentality of technology company?
Look, we need to test everything.
We need it to be perfect?
It's just such a technology -- silicone valley thing.
It's not something you think of happening in washington, d.c. they have learned.
Clearly this is a big lesson for them but also they are surrounded by some of the best technology minds that we have and they will put this to work.
All right, in soasa, i understand their testing could be pretty important with the holiday shopping season coming up.
Tell me about that.
Again another issue.
This is a huge case for soasta.
During cyber monday, when there are millions at the same time, millions of people hitting a site.
Sites can go down.
And whether it's going down or millisecond delays, that can cost millions of dollars in losses to companies like target or walmart.
They recognized this and so they use soasta for one of their cloud testing -- as one of their cloud testing solutions and they have been growing tremendously.
We will be watching cyber monday.
Hopefully key places i want to shop at are using this or something like it.
Thank you so much for joining us here on "bloomberg west." how successful was the ipad air debut weekend?
We have a peek at ipad numbers next on "bloomberg west." also watch us streaming on your phone, tablet and bloomberg.com.
I'm emily chang.
Apple's new ipad air hit stores last friday and why we're still awaiting numbers on how well it sold, at&t may be offered a hypothetical.
The carrier said ipod activation for customs increased 200% over the last 3 days compared to last week's launch weekend.
At&t also said it saw strong demand for next plan which offers customers ipads for zero dollars down.
Another part of a big apple launch are cases for these new devices and with apple keeping product details seek relate until the very last minute, ipad accessory companies have little time to design, manufacture and ship cases.
Here's a look at how one accessory company races against the clock.
Today you will see us gathered around the tv.
We will be watching the announcement, hopefully live on apple tv.
Thank you for joining us and good morning.
Apple does a really good job of being very secretive and holding this information close to the vest.
Apple does not give us a heads up on what's about to ship.
That doesn't happen.
We call it ipad air.
We like new devices as a company.
When there are new devices announced, people accessorize them and that's why we succeed.
November 1 is the availability date of the product which means have to start running fast today.
What they're saying is dual microphones.
That means all of our cases now need to accommodate dual mics.
Here's a crest release, right?
Now that i can start editing.
These guys have taken off.
They are not leaving because they're bored.
They know what to go do now.
From industrial design to mechanical engineering to marketing, web, 2-d design, everybody know what's their job is.
They're all listening for their bit of information at the announcement and they're going tookt accordingly.
Right now we're going to start growing and prototyping and testing concepts for the new ipad mini.
This is starting right now.
This is a very, very good 3-d printer.
Everyone always asks me where my ferrari is.
I tell them, don't have a ferrari.
It's thing this here.
-- this thing here.
Now we have old form factors we will continue selling through and brand-new form factors to sell through.
We're a very, very busy warehouse.
There's a reason we're the best at it.
We're pretty fast.
And we will probably be on shelves before other people.
Very cool to see that in action.
The new ipad mini with retina display is set to go on sale later this month.
One quick programming note, we are looking for entrepreneurs who would like advice from yahoo!
Chairman maynard webb 0 on building or launching start-up.
Fewer thean slides that includes background information on your team, vision and problem you're trying to solve at facebook.com/ bloombergwest.
We may feature some here on "bloomberg west." we will be right back.
This is "bloomberg west," and i'm emily check.
Grammys, c.m.a.'s, v.m.a.'s, move over.
There's a new award show in town and this one can only be watched online.
Youtube kicked its very own youtube music awards last night at pier 36 in manhattan.
The event was streamed live at youtube.com and included performances from big names like lady gaga, eminem, arcade fire.
It wasn't all smooth sailing.
There were complaints a number of technical glitches interrupted the live stream.
Introducing photos to twitter was a giant task for the microblogging site in the early days and so it turned to a company called photobucket to provide the infrastructure.
This lit twitter manage photo sharing and launch quickly and kept any big third party acts from emerging and stealing twitter's thunder.
Where is photo bucket now?
What does the photobucket experience tell us about partnering with twitter?
Cory johnson is back with more.
Partnering and partner, yes.
It's all about partnership with twitter.
Came to an end in december 2012 and since then the photo company sharing company overhauled website and user number tops flicker's. joining us is c.e.o. tom ronio.
I'm really curious, i have been reading so much about twitter and think about twitter and i.p.o. twitter that seems to be imminent, i wonder what yug experience was working with twitter in the early days?
The experience is actually good overall.
We knew that they wanted a short-term contract.
They were looking to quickly put in-line photos on their site.
Really the only place tchow do that and do it fast was through photobucket.
So we both went into this with our eyes open.
We got attribution on the photos and it helped us from a marketing perspective.
Bet we knew long term it was most likely they would bring it in house because it's core to their value proposition.
When twitter was faced with the decision, when they figured out photos was important, build it or buy it, they went with rent it?
For us it's a good thing they did.
If would i have stayed with twitter, most likely photobucket wouldn't exist today in the same form.
I would have become i white label third party hosting solution.
In terms of the things that make partnerships difficult but also the necessary things, discussions about price, discussions about terms beginning and ending of relationships, are these guys tough?
Are they pragmatic?
What are the things that really motivate them?
Tough is probably an understatement.
But fair is also a good characterization.
Tough in what way?
Tough in that it was a competitive price bid and they had other alternatives.
But not really one that would get them up as fast as us.
Even with that, it was -- we knew we were nearly the only game in town.
It was still a lengthy battle to negotiate this contract.
So you part as friends?
You're here on national tv, you will say that.
But walk away from the relationship thinking what about these guys?
No, actually full respect.
They really worked with us well.
We worked for them well.
We got them up and running in just months and skilled significantly . when we parted, it was mutual agreement we should part.
And then it really gave me a chance to go and focus on photobucket and what photobucket needs to be for our consumers versus twitter.
You take that and take the experience with them and you have been drinking from the fire hose.
Now you go and get into your own fire hose here.
What business lessons did you learn having worked with twitter and growing with them like that?
With twitter when they decide to do something, they do it and move quickly.
For me that was a great lesson.
Because i had to now really understand and think about what is the new value proposition for photobucket?
Where do i need to take this company and do it and do it fast.
What are the latest with you guys?
What sort of new business initiatives have you got going in some ways that reflect that path with twitter?
What we do now is we store -- we store all of your original photos and we connect you to all of the different devices and websites you want.
We really play that feature where you can get everything to photobucket.
It's a photo center and video centeric environment and share that anywhere you want.
We find that is a huge value proposition for consumers because they really don't look at social networks as place to store all of their photos.
And your methodology for sharing is interesting because it ames to be extraordinarily simple.
So we try to solve two problems.
One is photos are everywhere.
Half the people lose photos and half the them don't back up.
Probably that same half.
We try to solve that problem.
The other problem we try to solve is when it comes to an event, whether 2 people or 100, those photos never come together.
You might get one or two photos that are sent e-mail but mostly that's undone.
And there's been a lot of companies that tried to solve that but they solve that by, you know, plan ago head.
If you're male, you probably don't do that anyway.
Then you have to download an app and invite your frivends to download the app.
They install than you can all share photos within that app.
There's too much friction there.
So our new product that's coming out in the fourth quarter really resolves all of the friction points and makes it simple and easy to bring event photos together.
Like #, interesting stuff.
Tom, c.e.o. of photobucket, thank you very much.
Thanks, quore yi.
We turn to our partnership with george washington university's plan it forward, which seems out innovative ideas to help our environment.
Hydrocxsgpreelectronic power often requires large-scale dams but can be costly and impact fish migration.
Now there's a new inowe scration that generates electricity from water without doing any damage to the environment.
Plan forward host frank sesno has more.
We found one company in portland, oregon that play have changed the way we think about hydro electronic.
We spoke with the c.e.o. of lucid energy, renaissance kind of guy, painter, businessman, greg is paschette about green teg following.
I love doing things that other people have not done before.
I have been really fortunate in my career to be involved in really interesting, novel, proprietary technology that would make a difference in the world.
So how about this, take the water inside the pipe that's already flowing to your home, your business, under why are streets and harness it to generate electricity.
Hydrocxsgprepower goes local.
A small turbine placed inside existing water pipes can do the trip.
The system is designed to capture energy from water already flowing under pressure from every major city in the world, even underground the water flows downhill.
That's the way many types are designed.
Lucid pipe has two sizes of turbine to fit the job.
Up to 50 kilowatts of power can be generated.
That can be either used to offset the cost of delivering water for a city or it can be connected to the grid to power homes in a community.
It can be installed in drinking water or waste water treatment pipes, a new way of giving power to the people.
Water is the single most important resource on the planet.
Energy is the critical component that drives the cost of delivering water or purifying water.
The city of portland is installing lucid pipe systems to help meet its action plan goals.
It will generate enough electricity to power up to 150 homes.
And it allows water municipalities to find a new revenue stream that they can use to reinvest, to make their infrastructure more sustainable.
So the next time you turn on the faucet, think of the energy stored in the water you drink.
It could power your home and help move the planet forward.
And frank sesno joins us from washington.
Frank, it certainly seems promising but is there a catch here?
What are some of the limitations of this?
There's always a catch, right, emily?
Nothing if so good, it should have already happened.
First is cost.
A150 homes powered by this costs about $1.7 million to get that done.
It's also installation, putting in new pipes is one thing.
You can put turbines in the new pipes if you will retrofit it, which is really what would you like to to do, that will cost substantially more.
The pro opponents of the lucid pipes say they would like to see them deploy up to 200 mega watts of power every year.
That's hundreds of thousands of homes.
Maybe spending a trillion bucks over the next 20 years.
Promising but expensive.
All right, frank sesno, thank you, as always.
And if you have an idea you would like to submit to planet forward ucks visit planet forward.org.
And check out bloomberg.com/sustainability.
Now it's time where we focus on one number that telleds a whole lot.
John is in l.a. cory is here in the studio.
What do you got?
Yes, a many.
56%. tom wheeler was sworn in as new head of the s.e.c. the last time someone was sworn in, 2009, very different environment.
We have 56% of u.s. adults have smartphones today.
But back in 2009, only 20% of u.s. adults had smartphones.
It's only a few years, a very different world.
Wow, john, how about those numbers?
I want to go against the trend and get a brick phone.
Michael douglas style.
Everybody has a smartphone.
You and gordon gekko.
I see the resemblance.
Thanks, guys and thank you all for watching.
We will see you back here tomorrow.