Live from pier 3 in san francisco, welcome to "bloomberg west," where we cover the global technology and media companies that are reshaping our world.
I am emily chang.
Our focus is on innovation, technology, and the future of business.
Let's get straight to the rundown.
Oracle ceo larry ellison and his team have won the 34th america's cup, but the sailing competition may not be as big a win for san francisco or the company he helms.
As twitter get closer to an ipo, which stakeholders would have the biggest payday?
New details on how good the upside will be for the founders.
Amazon unveils its latest kindle fire tablet, sporting new features and multiple screen sizes.
If you are comparing it to ipad, ceo jeff these of says not so fast.
Larry ellison's oracle team usa has completed the biggest comeback in america's cup history, retaining the oldest trophy in sport.
His team came back from a deficit, winning eight straight must win races on san francisco bay, right behind me, to obtain that cup.
For larry ellison, it is a huge, personal victory.
He has spent hundreds of millions of dollars of his own money on his sailing passion, some might say of session.
While he is winning it sailing, there are questions about whether he is paying enough attention to his day job.
He told you that he skipped his keynote address at oracle open to -- for the race.
I'm joined now by former san francisco 49ers coo and longtime bay area sports executive who was involved with the very initial discussions of bringing the america's cup to san francisco.
So great to have you here on this big day.
I was actually down the street watching the race at the finish line.
I shot a video of the boat crossing the finish line, and the excitement was palpable.
I was there a couple of weeks ago when they were waved down, and nobody thought this kind of comeback was possible.
Purely from the perspective of the sport, how big a deal is this win?
It is a big deal, but i think it will disappear in a short time.
Everything we have going on, football and basketball starting, it's going to pale in comparison.
That is one of the real challenges.
What is next for the america's cup, how do you get more sports fans engaged?
Clearly, new zealand is viewing the oracle sale with skull and cross bones today.
It has been very much a niche sport, not mainstream.
Did he succeed?
No, i don't think he did.
Ultimately, this was talked about, in regard to being the olympics of sailing him and we just have such a shortage of countries because of the vast resources needed to win the cup.
So in the next opportunity, i think you have to have 10 or 12 or 16 countries from around the world sailing on boats so that everybody can win.
In the olympics, anybody can win the olympic marathon.
In the america's cup, only one person can win, and has now done it two times in a row a cousin of the resources and the passion he has brought into it.
That takes out the competition and doesn't bring it to a wider audience.
Ellison has been accused of making this cup too expensive for other countries around the world.
It was his vision to make these boats extremely technologically advanced.
They don't really sale, they fly along the water.
Is that a fair criticism?
I think so.
They are spaceships on the water.
Not that we're going back to the beauty of 12 meter yachts, but you have to put them on boats that everybody can embrace and every country has a chance to win, or else you don't have a competition.
He might have been the oracle in terms of saying i'm going to come back from the dead and when this cup, but the question is, which cities will compete to host the cup, how will it work as a business going forward in the future, and will sponsors want to be engaged in this, of which there was not a very high level in the technological capital of the world, san francisco.
I understand he wants to watch the races in person, but yesterday at oracle world, he didn't show up.
The last quarter was not fantastic.
Is he neglecting his day job?
I cannot speak directly to that, but he is a very successful businessman, and i'm sure there will be a few toasts to the miraculous win of oracle over the next few days of open world.
If you're talking about fortuitous timing in terms of winning a global race here and having open world, you couldn't have timed this any better.
Some people view him as a genius.
I don't think this has been a marketing win for oracle and definitely has not been a marketing or business win for the city of san francisco.
Let's talk about that.
I know you were involved in the early stages when the cup was coming to san francisco.
It has been very expensive.
Taxpayers were worried we would end up paying for this.
Why hasn't not been a win for san francisco?
We talked about the fact that a lot of countries could not compete.
Originally, larry ellison said that up to 14 countries were going to come here, and we got down to three or four.
People love to see competition.
Even though you could see it in the water, it did not ingrain itself into the american sporting mindset.
Big toys for big boys have a long way to go.
They talk about this being nascar on the water.
A completely different demographic than he was looking for.
There is a long way to go with all the competition he is facing in the sports world or in the entertainment world.
I interviewed the ceo of team oracle usa.
He said they want to keep it in san francisco.
If they do this again here for years from now, what should be done differently?
I think the city is in a great negotiating position, because they know what the shortfall was.
They didn't see the money from the silicon valley that they thought was coming to this cup.
I think they can help dictate what is the right kind of event.
San francisco is always going to be a spectacular city, whether it has the america's cup or not.
I would love to see it back here to build on the success and excitement they have had in the last week, but i keep coming back to the technology of these votes.
Races -- the technology of these boats.
Races were canceled because of too much wind.
You cannot cancel a sailing race because of wind.
Especially on the ultimate course of san francisco bay.
So i think the organizers have to figure out what kind of boats will be sailed in the next america's cup, and what the business model is, so more and more people can participate.
It has been a controversial race in so many ways from the cost to the scariness of these boats.
There was one death early on.
And he don't lynch, really great to -- andy ldolich, great to have your perspective on this.
Remember this oreo ad during this your super bowl blackout e meet the digital marketing guru behind it.
You can watch a streaming on your phone, tablet, and at bloomberg.com.
? i'm emily chang and this is bloomberg west.
When twitter goes public, no one stands to make as much money as twitter cofounder evan williams.
With about 15%, williams could become an instant billionaire.
Evan williams maintaining a 50% stake, substantially higher than jack dorsey.
For people who are new to twitter, he has not been in the picture for the past couple of years.
He left as ceo in 2010. he was pushed out, right e yes, he was off building his own company.
In the early days of twitter, when he first cart -- started the company, it was a podcasting service.
That failed, he returned the money for that service to shareholders.
A few of them gave those checks back to evan williams like mike maples, ron conway, they said take the money and put it back into that twitter thing you are building.
That is when they buckled down and created twitter and it grew from there.
He stands to gain the most out of twitter because he was there at the beginning and he actually invested a lot of his own money.
It has been a hot investment over the years.
There is a brief window where evan williams, one of the very people who believed in it, did write his own check.
Given that he was essentially pushed aside and has not been the face of the company for several years, is a remarkable that he maintains such a large stake e he basically has chosen not to sell his shares.
It has been a lot of opportunity for him to sell.
We have gone out and talk to people about, there is an over demand and after supply for twitter shares in the market.
Everybody wants a piece of this company and everybody has been trying to buy it on the secondary market.
He owns one of the biggest stakes in twitter, and he is reluctant to sell.
Jack dorsey, both these guys are probably going to be alien heirs based on the twitter ipo.
We have not figured out their exact stake.
That will probably become public when it is revealed to the public, finally.
Jack dorsey is the other cofounder, and fred wilson is the first institutional money in the company.
He invested when it was worth like $20 million.
We will see how it comes out, but evan williams is going to be the big winner, it looks like.
Evan williams with 15% of twitter.
Picking of twitter, -- speaking of twitter, the maker of oreo's recently struck an advertising partnership with twitter.
Twitter employees will work alongside to bolster the real- time marketing efforts.
The snacks giant will buy twitter ads and in return have access to customer research.
Mondelez had its now famous oreo ad on twitter.
Cori, take it away.
- cory, take it away.
The oreos at was talked about a lot here.
Using that as an example, what were you thinking their?
How did you make that happen?
My role is to run global media for tv.
The broader strategy is, how do we engage with the tv-based advertiser?
You knew you were going to post some ads in the spot.
That is a different approach.
Where did that idea come from?
Making sure we are participating in social activity , we can engage the overall ecosystem and raise the effectiveness of our television and participating social and mobile activity.
It means that more eyeballs are watching this at the same time as watching our tv spot.
On the low end, we see two times the effectiveness.
Think about what we are talking about, people are engaged in this main area of tv, and at the same time are seeing our conversation happening while they are watching it.
For us, the bigger opportunity is that we are really focused on global strategy.
That is why we made a commitment of spending 10% of all our media in mobile.
We spent about $1.5 billion in media globally.
What are you finding is working?
If you get a consumer at a certain age, you will get -- you will have them for another 20 years.
Is that right?
There is a loyalty aspect.
We have some of the world's most beloved brands.
For us it is almost about -- also about driving info.
On a mobile device, it is the only device you have with you throughout your entire day.
Where do you live?
I live in manhattan.
For the next three months, i will be in shanghai, working with our team there.
40% of our business is in emerging markets.
More than that, the china market is so exciting right now.
We want to be part of that early on.
You are engaging in the advertising effort in china.
To your point, when we look at those cities, we see the emerging class of mobile owners, those who have disposable income.
It is the first media device they are going to buy.
For us to be able to target them as a huge opportunity.
Really interesting stuff.
Cory johnson at adweek in new york.
We will be right back with more of bloomberg west in just a moment.
? welcome back to "bloomberg west." jeff bezos unveil the third generation of the kindle fire today.
It has a faster processor and four g wireless capability, but it also cost more than the older model.
Brad stone covers amazon and is writing a book on jeff bezos that is out next month.
What is the strategy here?
In previous generations, amazon has made compromises.
The first generation was kind of blocky and didn't do much.
The second-generation you don't have a back facing camera.
This device is very competitive with the ipad.
Then they have the lower model for the more thrifty buyers that cost $139. you just compared it to the ipad.
Jeff bezos says own comparative apple, our strategy is very different.
When you are making a higher end tablet, don't you have to compare it to the ipad?
It does most of the things the ipad does.
The place it does fall short is the app store.
There is not the selection.
There's is no chrome browser or google maps.
It is not quite where the other tablets are.
How well is the kindle still doing in general?
If you look at the guys out there who crunched the data from third-party companies, they say that kindle has negligible global market share.
Right, in the u.s. it is strong, depending on whose numbers you look at.
The thing to remember is this market is growing massively.
Doubling and tripling every year , far exceeding pc sales.
Is the kindle something you need the latest generation of, like the ipad?
If you have one of the older models where you can read on it just fine, are you good?
That is amazon's challenge, to convince the non-core customers why they need one.
They made a big deal yesterday about enterprise users.
Is there a reason to bring the kindle fire to work?
That is the challenge.
Brad stone, thank you.
Now to netflix, it is known as an online streaming service, after starting by shipping dvd's by mail.
But it soon be coming to cable?
The netflix cfo said today the company has had an open offer for two years to make the service available to cable operators.
Jon erlichman is in l.a. what do you make of these comments?
So interesting, because so many people position the argument of our people going to cut their cable.
They can do so, would it be interesting to see netflix come into the cable family?
Netflix reveal they have cut a deal with the largest cable player in sweden.
They already cut a deal with virgin media in the u.k. it almost makes you wonder, netflix has had the door open to doing a deal with the cable operators in the u.s. for several years, how come we haven't seen one?
We don't know what is going on behind the scenes.
It has to do with the revenue share.
The companies are thinking five dollars, six dollars, seven dollars.
The netflix ceo made a point of saying if it was available, hbo was available outside the cable world, its subscriber base would be much larger.
We know that these two are almost neck and neck when it comes to subscribers right now.
Netflix has ambitions to get up to 90 million in the u.s. and they feel like hbo will do the same thing.
Don't expect hbo to leave the cable world anytime soon.
The cable companies give them a lot of money to stay there.
He wrote the only authorized biography on the fiercely private steve jobs.
We have walter isaacson, next.
? you are watching "bloomberg west." i'm emily chang.
The iphone 5 s has advanced features compared to the iphone 5. apple has been able to keep the material cost at around the same price.
They released the results of a tear down of the iphone 5 s and five c today.
Cory johnson is on assignment in new york, but there is no one better to dig into the guts of a new gadget.
Tell us exactly what is in these phones, what more do we know now ? it is really interesting stuff.
Isn't it cruel, we are ripping it into pieces while the rest of the world is trying to get their hands on this phone.
The 5c really is a lot like the iphone 5. among the differences, we want to compare the two devices.
Interestingly, the bill of materials is not that different.
In both cases, the retina display and the touchscreen, and the gross margin is interesting, just a little bit better for the 5s compared to the 5c. cory johnson, our editor at large at adweek in new york.
On september 10, the same day that apple announced the latest version of the iphone, another apple related product was released, the paperback version of steve jobs, the official walter isaacson biography of the late apple cofounder.
It has been nearly two years since the passing of jobs, and apple has faced criticism, slowing growth, and a lack of innovation ever since.
Some of those innovative products still have not been announced, like tv.
Earlier today i sat down with walter isaacson and asked him what he thinks -- when he thinks we might see these new revolutionary products.
It has been about three and a half years since the last time steve jobs made us go "oh, wow." things we did not know we wanted until he told us they were indispensable to our desires.
That hasn't happened in the past 3.5 years.
I hope over the next year or so, apple does it, whether it is with some wearable product or whether it is a tv or a new type of camera, whatever it may be.
I think affable apple is fully capable of doing it.
They are perfectly capable of doing it, and i'm looking forward to it.
You're watching when tim cook and the team unveiled two new iphones, ios 7, however you were not that impressed.
You said they used the word incredible so frequently, the launch could not have -- some?
Things were described as incredible that it began to serve as a reminder that none of them really were.
Now that the phones are out, ios 7 is out, what do you think now?
I think what they have done in the last 3.5 years is built more beautiful rocks.
They have taken an inch off the iphone and ipad and added color.
It has not been a transformative product.
What we are looking for now is, can you do something as steve would say, think different, stay hungry, stay foolish.
That hasn't quite happened yet.
How do you think tim cook is doing, really?
Tim cook is running a very good, strong organization.
I just don't know whether in the next year they will blow us away with some amazing new product.
But that is the big test for tim cook, and my hunch is, it will happen.
You said that tim cook is doing a good job, very capable, that apple needs that spark.
Does johnny have that spark that they need to open their ranks and bring in some new blood?
Watching that product announcement, it made me miss that unbelievable spark of steve jobs.
But that comes around once in a generation.
You cannot replicate, and tim cook is really smart.
He doesn't get up every morning and say, how to why replicate steve?
It is true that it makes you deeply respectful of that spark that steve had.
It is it is very hard to replicate.
On that note, everybody asks that question.
I'm sure people have asked you the question, who is the next steve jobs?
Let's think about it in a slightly different way.
Is there somebody in the technology world right now that you think could someday be that person who captures the fascination, the world's fascination, the same way that steve jobs once did?
I watched that guy.
He has the same spark.
I think larry page has got that spark.
Certainly mark zuckerberg does.
We are great nation that is always producing people with the spunk and the spark.
None will ever be like steve jobs, but i can sit there and admire a lot of people in the technology space and say they are thinking different, just like steve did.
My interview with walter isaacson, president and ceo of the aspen institute and author of the only official steve jobs biography.
The angry birds rtv stars now, sort of.
Find out how they got more than a billion views online on their own tv channel, coming up on "bloomberg west." ? i'm emily chang.
This is "bloomberg west." in today's new hollywood,ovio entertainment, the company behind angry birds, is making a push into television, and it seems to be paying off.
It has generated more than one billion views since being launched seven months ago.
They plan to roll out more programming.
Jon erlichman has that story from l.a. the folks that rovio get tired of people just referencing angry birds.
This is a company that truly wants to be a big media brand.
They say all the time that they envision themselves being the next disney.
On the road to that, you have to roll out different products.
In the old days you probably would have found a home for cartoon shows on network television or cable television.
In the case of toonstv, they said let's make this our tuna available in the app.
Let's go to sam's onions make sure it can be available inside samsung televisions.
They have an on demand channel with comcast, and people know it is available on roku, too.
I did speak to rovio executives and they were clear that most of the viewing have been coming from people who say the gain -- play the game and see the cartoon and click on it from there.
They are adding more shows to tv.
Can you tell us anything about that?
I spoke to a a rovio executive and he said basically you are rolling out one show.
You know the audience is going to like something and they want something else, too.
They want variety, not just one show or one episode.
They are going to roll out more of these shows and bring in other content partners under the same number a lot.
They have teamed up with stan lee, the creator of spiderman.
They are looking for more partners.
They are clear about that.
Jon erlichman on the angry birds from l.a., thanks.
Turning back to adweek, for years the new york post operated a website that was not optimized for today's ad revenue streams.
Earlier this month, it revamped its digital platform to optimize it for mobile reading and targeted ads.
Cory johnson is at adweek in new york and has more on that.
The new york post has always been mobile and portable, but not like it is now.
Tell me what you try to do in this digital format that you're out with now?
We are one of the great brands in the business.
When we redesigned our website -- that is on page 16. it is also further back in the newspaper.
We wanted to do a responsible design that works across all platforms.
The same site on your mobile phone or tablet is the same site you would get on your desktop.
Right now, 35% of the traffic is coming from mobile platforms, phones or tablets.
I think it will be 50% easily within 12 months.
I think most publishers are seeing this.
Imagine your audience, it is fundamentally a new york kind of paper.
Certainly in terms of the printed product, certainly it is a fundamentally new york product.
But on our digital pratt form, 80% comes outside of the area.
Tell me how it works with advertisers.
We work with a company called avalanche which has great technology that serves ads together in a carousel.
We can serve the advertising message right next to content, and it is right there at your fingertips.
It is performing very well.
There was a giant effort in the daily but it did not work.
The daily was a startup.
I love that i work for a corporation that was excited about a new technology and wanted to just take a chance and do something experimental and different.
We set out to become the number one paid news app, and we succeeded in doing that.
The business did not turn out to be what we wanted it to be, but there was a lot of great talent that came into the company that came with us over to the post to help lead the digital revolution at the post.
Everybody is seeing enormous growth in mobile web right now.
We are very conscious of that.
Everybody is seeing their mobile numbers just go through the roof.
There has been a move away from some apps for the mobile web.
Are there things you wish you hadn't done?
We met a great product.
I love what we did and we have hundreds of thousands of people that love what we did.
It was an experiment, it was a startup.
Jesse angelo, thank you very much.
Do you have a great idea for a startup and want advice from a google executive?
You might be in luck.
Details on that, next on "bloomberg west." ? welcome back to "bloomberg west." reported glitch in apple mac is causing some confusion for drivers in alaska.
According to the alaska dispatch, drivers using apple mac to get to the fairbanks airport are being directed to an airport taxiway.
That is where the route ends.
However, the taxiway is directly across the runway from the main terminal, and in two cases, drivers have reportedly crossed the runway to get there.
The airport has asked apple to fix this issue.
Today, google launched its tech hunt for entrepreneurs, a network of seven cities across north america.
It will help local entrepreneurs with ties to cities like detroit and nashville.
Each hub will become an official google partner and receive financial support.
Mary grove leads the rogue rams in partnerships to support startups around the world.
She joins me now from chicago.
Chicago is one of the cities where you are starting these hubs.
How exactly is this going to work e iq so much for having me.
We are excited to launch the tech hub network which is a program within our broad umbrella of google entrepreneurs.
It is a network of seven key partnerships with organizations on the ground for providing physical space and mentor ship and exciting programs for entrepreneurs locally.
Ask what kinds of the dice, what kinds of people at google are these entrepreneurs going to have access to e the partnership itself is directly from google, we are providing financial sponsorship to underwrite some of the operational costs, as well as community events for the on -- for the entrepreneurs within these heck hubs.
We provide access to product training on a range of topics ranging from marketing to technology platforms.
Is larry page going to weigh in on these things that go -- on these things?
There will be a local point person for each of the seven tech hubs.
In minneapolis, we have heard they are interested in learning about social media and google plus, online marketing.
We will have a team there to host training and hang out with the entrepreneurs as well.
How did you decide what cities to do these hubs, and what plans do you have to expand beyond them?
It has been an exciting trend we have noted.
We started it two years ago as an effort to organize all the outreach work happening across google.
We are a company started in a garage 15 years ago.
We just turned 15 this month.
This is an effort to double down on about 70 different programs under the umbrella.
We talked to various partners across the country and we have seen the rise of tech hubs across the last few years, across the country and across the world.
We selected seven that have a like-minded mission and really want to be that community to learn.
I was just in detroit interviewing twitter cofounder jack dorsey and talking to venture capitalists about why they invest their.
They certainly e your point that there is a lot of talent there but not a lot of investment opportunity.
This could be helpful to google, in terms of being a pipeline for talent, and opportunity for you guys to invest in startups that you think are promising.
Our focus is about the community building aspect.
Our strategy is to support local leaders on the ground who are doing this work.
That is why partnership is the primary strategy.
We do get rations about google products and platforms, but the primary goal is about being the platform to empower the next generation of startups to succeed.
Could there be potential acquisition targets for google?
We are always looking for great companies across the board.
If that happens organically, that is definitely an opportunity, but the primary reason again is about the op community.
When we support them and they succeed, is great for the companies themselves, great for the users, and great for google as well as more companies come online and utilize the web.
Mary grove in chicago, thank you so much.
Time now for the bwest byte, where we focus on one number that tells a whole lot.
What do we have today, guys?
Number 11, that is how many races oracle team usa had to win in order to win the america's cup.
They were too in the hole because of their penalties, a cheating scandal in the off years.
Very exciting coming from behind.
I'm so jealous that you were there.
I cannot believe you missed it, cory.
We are looking at the video i shot there at the finish line.
The weather was perfect.
There was this moment in the race where it look like they were losing, and then they just came back in this amazingly remarkable way, and they won by a landslide.
I don't know what the equivalent is in sailing terms.
Your video and your picture are all over social media right now.
I had a great spot.
It was a very exciting moment.
I will probably be coming back to san francisco for years from now.
Thank you, guys.
Thank you all for watching.
We will see you back here tomorrow.