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Bloomberg Audio.
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Studios Podcasts Radio news.
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Bloomberg Tech is live from coast to coast.
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Caroline Hyde in New York and Ed.
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Ludlow in San Francisco.
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D
This is Bloomberg Tech. Coming up, headlines out on a call between US President Trump and Chinese President Xi Jinping about a framework agreement for TikTok's US operations. We will break it down.
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A
Plus Apple rolling out its new iPhone designs in stores today. We'll discuss what the customer and the stock reaction is.
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D
And we sit down with FCC Commissioner Anna Gomez to discuss the suspension of the Jimmy Kimmel show and much more. IPhone 17 on sale today. Caro went down to the store. We'll get the details in video. We're watching because we have not had any headlines out of that conversation with President Trump and Xi Jinping. Whether we in video is discussed or not, but that's what the market's watching and I throw Oracle up. We have had a headline out of that call. It is from China's news agency Xinhua and it says that according to Xi Jinping, China is prepared to respect the wishes of the companies that are involved in the TikTok deal. It has been reported that Oracle Oracle is part of the coalition and it's trading at a record high, but we do not have confirmation on the specifics. Caro, we're just watching that because it's the publicly traded name.
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A
Indeed, there are following headlines coming out from that readout of the call. She has asked for the US to refrain from taking unilateral trade measures. A clear focus therefore on tariff measures. She on TikTok saying they welcome business talks following market rules. And she also saying on TikTok that the Chinese government responds, respects the wishes of companies. Perfect person to discuss all of this is Bloomberg Senior Tech editor Mike shepherd who joins us from Washington. What do you make of the readout?
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E
Oh, Carol, we're still looking at this readout as it comes in and as we're trying to interpret its meaning, we are not seeing a clear cut signal that China has given its blessing to this framework agreement that was unveiled by Chinese negotiators and US Negotiators after two days of talks in Madrid. There were very few details on that accord at the time. But our reporting has shown, as Ed has pointed out just now, that Oracle as well as Andreessen Horowitz and Silver Lake Capital Management would be among the US buyers of TikTok's US operations should approval actually come down from the Chinese side. Donald Trump for his part of course, is eager to see this see this deal go through. He wants Tick Tock to stay viable in the US he credits it with his election comeback victory. But we have not heard from the president yet at Shep.
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D
More headlines and another red headline on the Bloomberg terminal. Xi has asked for the US to avoid undermining the outcomes from recent talks. I think that's a signal politically right. And remember, these headlines are from a readout from China's state news agency. We also have another headline on Tick Tock. China would like to see the companies find resolution to the Tick Tock issue, according to Xi. Again, Mike, we're following this in real time, but we're learning about China's attitude. We still don't have the concrete details of what the structure of a US Tick tock is.
- [04:42]
E
Well, that's right. And it also doesn't sound like China is giving its full thumbs up there. It sounds like Xi Jinping is signaling that there are still some objections and that maybe something came up during the call with President Donald Trump that gave China pause. We did even hear from Trump yesterday, a bit of a non committal tone, not quite a full walk back of what we heard at the beginning of the week following this framework agreement between the two sides on trade, but especially on TikTok. But he was saying we'll see. Those were his exact words in A Fox interview, and that's usually a signal from the President that there may be more work to do. So we're still waiting to HEAR what the U.S. version of events is and whether they think that they are any closer or perhaps further away when it comes to talks. It does sound like there are a lot of business issues still to resolve, including from the Chinese point of view. And remember, this is key to understand. China does not want to sell TikTok. It wants to see ByteDance hold on to this and if it is sold, it wants to keep control of the algorithm and not see its company. ByteDance is considered a real star in the Chinese tech universe. It does not want to see it diminished in any way. So there has to be a hefty price paid for this and it also does not want to see the valuable algorithm transferred in any way to US US owners.
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A
We're just going to try and bring up a chart because Oracle is still trading higher, but only by a percentage point now. It is actually pulled back from its highs directly on the readout coming from the Chinese state press right now, of course, Oracle's name in the mix for any sort of coalition of companies that were looking to be buying TikTok's U.S. unit. Now we can see that it's just come off of its highs. So it looks as though as you interpret, Mike, that indeed this doesn't feel like a done deal yet and indeed that we are still trying to get the intricacies of what China says it likes to see companies to find resolution to tick tock issue. Of course we need the US interpretation of all of this next steps might therefore, because we were hoping that maybe other things were being considered in the phone call, not just TikTok but in video and many more.
- [06:54]
E
Well, that's right. There are a host of trade issues between the two sides to resolve. And I'm glad you brought up in video because the question of export controls that have restricted the chip maker's ability to sell its AI products in China have been a major sticking point between the two sides. We've seen Jensen Huang really advocate here in Washington over the past nine months for a relaxation of the US export controls. But he's also run into some headwinds in China which is also moving to discourage Chinese companies from buying the company's chips. So there is a lot at stake and it's unclear whether Donald Trump in use this call to try to go to bat for Jensen Huang and Nvidia. The President has signaled his openness to the idea of perhaps selling a downgraded version of the new Blackwell line of AI chips in China. But again, you know, that is a multi step process in terms of relaxing those export controls and it's unclear whether this would factor into the conversation. Jensen Huang, for his part, certainly would like it to. They're feeling the sense of urgency in China where Huawei is really moving ahead by leaps and bounds when it comes to developing its AI chips and finding ways to deploy them in a way to better compete with Nvidia, as we just saw yesterday.
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A
Carol Mike Shepard, we thank you for the breakdown. Instant analysis. Let's get more instant analysis for you. Sam Sachs, senior fellow at the New America Institute, who has worked on Chinese technology policy for over a decade. So your viewpoint and expertise crucial here. It feels as though maybe a deal isn't done. How do you interpret what really the outcome of a phone call can be?
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F
Sam the pathway to a deal, and I don't just mean a tick tock deal, but a broader US China trade deal, is strewn with obstacles. Both sides clearly want something that they can deliver. But let's break it down. What's in the way? China realizes that they have real leverage here and they're not going to give in to this easily. They know that Trump wants to take home something to his audience at home. The second thing is that there are hawks all over Congress in the administration who also work very hard to ban TikTok, only to see Trump look to trade it away. And they've raised hell about the idea that there are supposed national security concerns that are going to go unresolved about data access, about online content. So there's a real sort of complex web of issues that both leaders are going to have to work through to bring home the political win for their respective constituents.
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A
A political win thus far had been signaled to the market that a US part of TikTok would form as a different app entirely. The users, 170 million of them, would migrate to a different app as reporting goes and would be controlled by US Investors. But how hard is that sort of a pill for China to swallow? There had been reports, of course, that China or ByteDance would license the underlying algorithm. Why is Tick Tock become like the linchpin to so much more in US China relationship?
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F
The algorithm for a long time was the secret sauce. It was something that bytedance was able to do far more effectively than its peers. But keep in mind this saga with TikTok has been playing out for about five years now. And so what one time was seen as ahead of the game in getting users hooked on the app, the flywheel effect of them collecting more of their data. It's no longer really as cutting edge as I, I'd say it was five years ago when this first became an issue. But that doesn't mean that Beijing is going to let it go so easily. This is a Chinese brand that has succeeded globally beyond China's markets, at a time when that's key to China's asserting influence in the world. And they're at the beginning of being able to field companies that markets that consumers out China outside of China actually want. So they're not going to just give this over easily to the US as much as they want to secure a deal as well. Also, they have big wants still on the table. They want export controls lifted. Mike mentioned about the Nvidia chips. Maybe they're holding out to see what exactly they can exert from Trump.
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D
Sam, I'm going to go back to the news because we are literally digesting what is a readout from China's state news agency. And according to that readout, President Xi says that the Chinese government will respect wishes of companies in the context of Tick Tock, that on Tick Tock they welcome business talks following market rules. And the final headline is that China likes to see companies find a resolution on the Tick Tock sale. We're yet to get the readout from the United States side. But as somebody that's looked at Chinese technology policy both from within the US Government and from the private sector, is this a positive signal she's making or is it a negative signal, a warning?
- [11:50]
F
Xi's administration has not changed its position. They're saying that now, but actually the reality is they've been saying that for a long time. I don't think that they care that much about TikTok, to be honest. But I think they know that Trump cares about it. And they see this as the linchpin to opening up a broader set of asks beyond TikTok export controls, tariffs lifted. They want access to the US Market for more investment. There's a litany of things. And then it becomes becomes a game of chicken. Who's going to blink first? And China knows they have something here.
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A
Sam Sachs from the New America Institute. Fascinating to have you on amid the breaking news. We thank you. Coming up, we're going to be breaking down the week that was in tech markets. We're still at record highs and powers. Martin Norton joins on that next. This is Bloomberg Tech Cybercriminals. Count on chaos. Count on veeam to stop them fast, partner with them and get 24. 7 ransomware support from the first red flag to full recovery. Whatever the world throws at your data, it's all good. Learn more@veeam.com that's V E-E-A-M.com in business.
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A
Breaking News Some headlines coming across the Bloomberg Terminal that Chinese President Xi is asking for the US to avoid undermining outcomes from recent talks. Bloomberg's Tyler Kendall joins us now from the White House. We've had the readout from the Chinese State Press regarding that phone call between Xi and Trump. Now we await Trump's reaction. What do you make of the headlines?
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H
Right? Exactly, Caroline. And a White House official tells us that we will get the White House's formal response in a post on Truth Social. So our eyes at the moment are peeled on President Trump's social media feeds. But as you read that main headline here, that Chinese state media is reporting that Xi Jinping says that the US should avoid undermining any recent progress in the talks, but then also the US should refrain from taking any sort of restrictive trade measures. And there's a few different angles and threads that we could really dig into when it comes to that idea that it appears that Xi Jinping is trying to portray, including that we saw really both sides ramping up the pressure ahead of those talks in Madrid earlier this week, including for example, the US adding some 23 Chinese companies to its entity list over the weekend. You were talking in your earlier segment about this idea around the messaging of export controls. And we've also seen the US really harden its rhetoric when it comes to so called secondary tariffs against China, urging our allies to impose them over their imports of Russian energy supplies. We have to keep in mind, put this into the context that our reporting has long showed that China has been upset, has been dismayed at the this idea that they have been treated differently from other trading partners. That's why you'll recall it was so significant when that 34% so called reciprocal tariff came back down to 10%. But of course we saw the 20% tariff related to fentanyl still on the table and its actions like those that perhaps we'll see some sort of movement on as we wait the readout on the White House's side. Now, as you well know and we're discussing the focus of today's call appear to be really on any sort of movement around tick tock. But when it comes to these other trade concessions, our analysts at Bloomberg Economics point out we really haven't gotten many signs up to this point that there has been movement on that because most of these talks have really been about keeping that de escalation in place. Caroline and Ed, yesterday President Trump suggested that he is considering extending that tariff truce deadline. It's set to expire on November 10th. That comes just weeks after a potential face to face meeting. This call was largely seen as perhaps setting the stage for that that we're eyeing could potentially take place next month, end of October in South Korea on the sidelines of the APEC summit.
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D
Bloomberg. Tyler Kendall at the White House, thank you very much. It's really hard to interpret carry the market response here. The S&P 500 has paired what were modest gains to basically trade flat and yields have ticked higher since we got those headlines. We were waiting for this, this phone call. Martin Norton is chief investment strategist at Empower and joins us now for more. I mean, that trade headline is the main one, both that she is calling on the President of the United States not to go back on what was discussed in talks. And you heard Tyler's reporting there. As a market participant, Were you braced and ready to move this morning, or did we get what we expected?
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C
You know, we're in a kind of a world where there's a bit of a shoving match, and I think it's largely to be expected. There's not a massive clarity around what this could look like. And it's continued back and forth at this point in time. I think what we're seeing more broadly is the degree to which geopolitics is entering and becoming another source of volatility for the markets, something that impacts individual companies and the market more broadly. And the news is sudden and it's catches folks off guard.
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A
It does, yeah. Sorry, you go.
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D
No, no. I just wanted to point out the other red headline, right. Because the news is just flying through the terminal as we speak. The other one is that President G. Mata says that he wants the United States to refrain from taking unilateral trade measures. Again, we're trying to interpret a readout from China's state news agency, but what is your interpretation of that comment?
- [19:25]
C
I mean, it certainly seems like there are bigger things at play right now. I think the reporting that, that you all have just shared, showing that, yes, tick tock is something that's a primary concern, but there are other primary concerns as it relates to the broader trade relationship. And right now both sides are trying to find those points of leverage to determine what can be pushed to gain kind of the greatest advantage in this conversation. So it seems like we're kind of listening into one part of the conversation, but it's part of a much broader discussion that's been going on and continues to go on.
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A
Martin, it's interesting timing that JP Morgan Asset Management has put out this thought that actually what Trump's geopolitical risk right now is the story, and if we get a bad set of numbers of any earnings look weak and some of these stars, that's where the market volatility really comes from. But actually, the whole story around semiconductors is so intertwined with geopolitics as well. So how do you distinguish the two?
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B
Right.
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C
It's a pretty fascinating time. I mean, we're looking at company after company that seems to be very in tune to what the Trump administration wants. And I think it underscores this idea that AI isn't just a form of secular growth for, for companies and for the economy, but it's something that is akin to the space race in terms of sovereign interest. And so I think it adds this whole nother dimension that we have to consider as we think about those sources of volatility. I think one consideration here is what does demand look like if we're looking at a more bifurcated world where potentially US and China aren't necessarily buying from each other as much as they are jockeying with each other when it comes to AI? I'm not sure that necessarily changes the whole AI narrative. We know that there's massive, massive amounts of demand even here, just domestically. But I think it's a, it's a whole new dimension that we have to consider as we, we take a look forward and try to project expectations and.
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A
We try to stomach the fact that we're up 16% year to date on the NASDAQ 100 and we're at record highs. So with all the underlying risks, should you be buying into this market?
- [21:32]
C
You know, in my mind at this juncture, we're at a point where it makes some sense to rebalance, to take some profits. We've had this tremendous run since April 8th where we've seen a lot of these companies recover, even something like the Mag 7, which had a much bigger hit in the first part of the year due to Deep seek, even that area of the market is beginning to look pricey now. Companies have delivered the earnings, has been there, that the investment in the future, the CapEx has been there. We're seeing demand from the hyperscalers based on AI workflows. So there's a lot of positives to point to, but it really wouldn't take much, something coming out of left field like we saw with Deep Seek, to maybe have people pull back a bit. And I think when we think about these innovation periods, it shouldn't be a straight line higher that would defy reality. It ought to be something that has fits and starts and moments of doubt. So I think when we're at a period where it feels somewhat euphoric, it's time to position for a potential moment of doubt.
- [22:27]
A
Martin Alton of Empire. Great to have you on amid these moments of doubt. You are looking currently at pictures of the Apple store in New York on fifth avenue. Earlier today, the company was rolling out several new iPhone designs, but kind of the biggest overhaul that we've seen since 2020. I was there as the Apple CEO Tim Cook walked around the store. There were NBA players there and there were influences. And that was me trying to get a moment with Tim Cook talking about perhaps some of the issues they had with getting enough iPhone pros into people's hands on the day. Of course we're knowing that some of the timelines being pushed back, but it's not just the cue, the enormous cue that I saw lining the streets of New York, but that was replicated in London, wasn't it? Was over in Asia as well.
- [23:17]
D
Yeah, it was. And it's interesting because you follow the clock around the world. Let's bring in Bloomberg's consumer tech editor, Dana Wollman and let's start on that piece. We have the information from Asia into Europe, now the United States. What's the reaction to iPhone 17 launch day?
- [23:32]
H
So definitely some long lines in all the major markets where reporters have visited stores. And relatively few of the customers who we interviewed mentioned the iPhone air, which is the skinny iPhone that got so much media attention ahead of the launch. It turned out that most of the customers who we interviewed were looking for the iPhone 17 Pro or the pro max, which makes sense given that these phones are for pro users. Power users and early adopters and tech enthusiasts are precisely the sort of people who might feel motivated to line up in front of a store around dawn the day of a launch.
- [24:04]
A
It's interesting that in the eye of the storm is of course a supply chain that Apple has largely based in China. We are getting more breaking news of the readout coming from the Trump Xi talks on the phone with President Trump putting on social that he just completed a very productive call with president Xi. But I'm interested in more broadly how you're seeing the supply chain impact. Dana, what's happening on the ground with the sales of the iPhone pro and how quickly or not we're able to get them in our hands and some of the issues perhaps scratching of them over in China.
- [24:36]
H
So far not many shocks in terms of delays or shipment times. Shipment times have slipped by a couple of weeks in certain markets for very popular models, but nothing that's seems too extraordinary. The iPhone air has been delayed in China seemingly over the e sim, which is not a widely used technology in China. And the iPhone is the only of the iPhone models that exclusively uses that as opposed to a physical sim being an option.
- [25:04]
D
Okay. Bloomberg's Dana Walman, thank you very much. We have more breaking news from the call between President Trump and Xi Jinping. Posting on Truth Social, President Trump says that he has agreed to meet with Xi Jinping and that meeting would take place at the APEC summit. Caroline, my understanding is the APEC summit is October 31st to November 1st. On tick tock, Trump says that they made progress on the approval of a Tick Tock deal. Trump adds that he appreciates the Tick Tock approval. We're continuing to get a lot of headlines, but not seeing any immediate market action or anything that contradicts some of the statements. Cara, if you want to jump in on what we, we had earlier, maybe we'll go back to break and we'll see what the markets are doing.
- [25:43]
A
Oracle still trading at about 1.4% higher on the back of that. Meant to be, of course, a part of that consortium buying Tick Tock. But the key news is that they have agreed to meet again next month. That.
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D
I read someplace that the networks.
- [26:03]
E
Were 97% against me.
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C
I get 97% negative, and yet I won easily.
- [26:09]
D
Won all seven swank states.
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G
Popular, but won everything.
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E
And if they're 97% against, they give.
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C
Me only bad publicity or press.
- [26:21]
E
I mean, they're getting a license.
- [26:23]
D
I would think maybe their license should be taken away. That was President Trump saying US Broadcast networks should face scrutiny over their license audiences if they're too critical of him. His comments came not long after Jimmy Kimmel's show was put on indefinite hold by Disney following reactions to comments the comedian made accusing Republicans of trying to gain political points from the killing of GOP activist Charlie Kirk. Bloomberg reporting that Kimmel met with Disney executives yesterday. According to sources, the soonest the show could return is September 22nd. I want to get to Bloomberg's media reporter Hannah Miller. Let's start on what we know in, in the news, which is that meeting between Kimmel and Disney. What are the details we need?
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A
Yeah, so we know they're discussing the.
- [27:11]
H
Fate of his show and whether there will be an apology or not. You know, Kimmel might be made to.
- [27:17]
A
Go on air, apologize for his comments, and that might be something he doesn't want to do. Meanwhile, as we wait for the reaction of the host himself, Hannah, you've been putting out some, some really strongly worded reporting, talking about basically the war that President Trump is having with the media. Set the context for us. Yeah, the Trump administration has a very.
- [27:38]
H
Contentious relationship with the media.
- [27:40]
A
We can see that in lawsuits Settlements, federal cuts to funding for public broadcasting. You know, it's, it's been battle after battle. And a lot of what's happening here.
- [27:51]
H
Is that many of the news organizations.
- [27:54]
A
Being targeted have business stakes at play.
- [27:57]
H
And that's sort of being weaponized against them here.
- [28:00]
A
Bloomberg's Hannah Miller. It's a really thoughtful piece. Please go and read it. But let's get you another viewpoint. Now. Anna Gomez is the sole Democratic commissioner at the FCC, one of three commissioners that currently on the FCC, been there since 2023. You put out a very strongly worded statement following what seemed to be Jimmy Kimmel's show being put on ice indefinitely. And you really talk about it having been led to a shameful show of cowardly corporate capitulation by ABC that has put the foundation of the First Amendment in danger. So you think this is a corporate responsibility?
- [28:34]
I
At this moment, what we are seeing is this administration use whatever levers of power it has in order to bring broadcasters to heel. And the news media, as you mentioned, they have sued the New York Times, they have sued the Wall Street Journal, they have gone after abc, NBC, cbs, and they are pressuring companies to change how they report the news and what their content is in direct violation of the First Amendment, which guarantees a freedom of speech. And what happens every time we see this cowardly corporate capitulation is a further fraying of a foundation of our democracy and that's freedom of speech and freedom of the press.
- [29:21]
A
Now, what we understand to have occurred is that Disney moved after local stations had perhaps pushed back. This is all erupted after, well, the head of the commission, FCC Chair Brendan Carr, joined a podcast and really articulated perhaps, perhaps what could happen because of the words of Jimmy Kimmel on the one his broadcast, but also what he said. We can do this the easy way or the hard way. On that Benny Johnson podcast when it seemed to be talking about the next techno deal, is that how you interpret it? Is that how the market and the media should be interpreting what FCC chair Brendan Carr is trying to make here?
- [30:01]
I
I think it's really important to note that the fcc, the FCC does not have the authority, the constitutional right, nor the ability to take action against broadcasters because of their content. We have very limited media regulation, usually designed to protect children programming and things like that. But we cannot retaliate against broadcasters for legal content. And this is all legal content. So what threats are meant to do is, is to get the companies to alter their practices in order to cover this administration in the way that they want. And that is what These corporations need to keep in mind every time they capitulate, they are harming our democracy.
- [30:48]
D
Commissioner Gomez, I'm grateful for you coming on the program and what you just said about the remittance authority of the fcc. The basics that our audience want to understand is why is the FCC involved here? It is a panel or a committee. Right. That debates issues usually proposed by the chair in the public forum or in written communications, and then you vote on the passing of measures or actions and stop me when I'm wrong on that. But. But you outlined what the authority of the FTC is not in this case. What is your role in this situation between Disney, Jimmy Kimmel and the comments that he made.
- [31:31]
I
So the fcc, as you note, does meet as a commission and it votes to adopt rules or to issue licenses. But a lot of the actions that you're seeing from this commission right now, particularly when it comes to trying to bring media to heel, is being done at the, the staff level. And what's so dangerous about that is where we initiate investigations. Until those investigations actually get to a final commission decision, there is no judicial review to ensure that the FCC doesn't overstep its bounds, which is exactly what we're doing right now. And you mentioned the nexstar transaction, which is actually not currently before the fcc, but will be filed before the fcc. The FCC has been using any time a party comes in to seek a transfer of a license or some type of permission from the FCC to pressure them to alter their practices directly affecting the First Amendment and getting them to voluntarily commit to making changes to how they report the news or whether they have diversity, equity and inclusion practices which themselves have a strong basis in the First Amendment.
- [32:43]
D
Commissioner, we've invited the chair, Mr. Carr, onto this program as well, and I want it to be to be known that that's the case. There is an example or case study that our audience wants us to ask you about, and that is if Mr. Carr and the President wanted to initiate the revocation of a station's license based on that station airing of the Kimmel comments, for example, what needs to happen? Would there need to be an outside complaint filed to the fcc? Then you review it. Just explain that that scenario, please.
- [33:19]
I
Yes, so revocations of licenses are extremely rare. We do have rules about under what circumstances we might revoke a license, and it is a very high speed standard because it is such a serious thing to do. That is why the broadcasters fear so much any type of action by the fcc. Yes, we can initiate an investigation based on a complaint that is filed, we can also initiate it ourselves. But let me be clear. There is no basis for revoking any licenses because of the Jimmy Kimmel content or because of normal editorial decisions from a broadcaster. The last time I can think of that we revoked a license was for failure to air a particular broadcaster for more than a year.
- [34:06]
D
Well, Commissioner and Caroline, I'm sorry to jump in here. You know, there are many Republicans and non Republicans who feel that Kimmel's comments pushed, went past a line. They crossed a line and mischaracterized in the public domain the motivations of the shooter in the Charlie Kirk case. And the FCC takes that into account or it does not.
- [34:31]
I
So we have to keep in mind that Jimmy Kimmel show is satire. It is not news. It is not itself trying to inform the public about a particular newsworthy event. And what, what some of these people are claiming is that what Jimmy Kimmel said was news distortion. That really does not meet the standard for news distortion. So if a complaint were filed, the commission would have to look at it and make a decision about whether any rules were violated. I can tell you today there were no violations under the law or with these facts.
- [35:09]
A
Have any complaints been filed?
- [35:13]
I
I believe a complaint was filed today. There is a partisan legal group that has been filing complaints against all the media companies getting more and more outlandish in their complaints normally for news distortion. They're the same ones that filed the complaint against 60 Minutes for the Kamala Harris interview. They're the same ones that filed a complaint against NBC because of Saturday Night Live, the Saturday Night Live showing with Vice President Harris. So they're a partisan organization that just keep filing these complaints and the FCC has not acted on all of them. They are very numerous, I would say we get at least once a week.
- [35:57]
A
I think it's right to put in the context that last year Disney Indeed did pay $15 million to settle a defamation lawsuit brought by President over comments that one of its hosts had already made. There have indeed been several settlements. And as Hannah Miller, our reporter, put in their story then often there are deals in M and A involved. Is that the interpretation that we should make at this moment that the deals in some way hinge upon settling of such cases and concerns?
- [36:25]
I
I think that the administration will use the deals to pressure companies one way or another, whether it's to settle lawsuits or to give up their rights as organizations. When the FCC approved the Paramount Skydance deal, for example, the parent company of CBS Paramount agreed to install what I call a truth arbiter an ombudsman reporting to the president of Paramount who will field complaints about media bias, for example. That is really chilling because that is exactly the type of interference and the freedom of the press that is not healthy for our democracy and for our discourse. So yes, I think this administration will weaponize any transaction. Anytime you see a party coming before the fcc, you are going to see some kind of a demand to bring them to heel and to change how any broadcaster reports on this administration to make it favorable to the administration and not otherwise.
- [37:31]
D
FCC Commissioner Anna Gomez, we appreciate your time joining us on Bloomberg Tech. Thank you very much, Caroline. I just want to go to shares of Disney very quickly. In the course of that conversation, the stock actually hit a session low of 2% and now down 1.9%. We did report just before the conversation with the commissioner about the meetings that are taking place between Disney executives and Jimmy Kimmel. One of the ideas or questions being an apology or not. We also have to go back to the breaking news because we got a full readout from the president on the conversation with Xi Jinping. Productive call. He says they made progress on issues including trade, fentanyl, the need to bring the war between Russia and Ukraine to an end and for this program, Bloomberg Tech the approval of the TikTok deal. He agreed with President Xi that they would meet at the APEC summit in South Korea. I believe that's October 31st through November 1st and that he would go to China. This is the bit we didn't get to yet that he says in his true social prose. The president he will go to China early next year. The call a very good one. They will be speaking by phone again and the president says in his words we appreciate the tick tock approval and both look forward to meeting at apec. That's the one the market was waiting for this week.
- [38:37]
A
It is a lot of people who are investors in semiconductor shares. For example Nvidia, will it be able to continue to sell into China? Coming up, we're talking exactly that about AI Magnitar senior managing partner David Neidman is with us. He's going to talk about the investing build out the AI, build out the scale of that magnetar. Of course a key investor in core. We've stick with us this Bloomberg Tech.
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Ryan Reynolds here for Mint Mobile now. I was looking for fun ways to tell you that Mint's offer of unlimited Premium Wireless for $15 a month is back. So I thought it would be fun if we made $15 bills, but it turns out that's very illegal. So there goes my big idea for the commercial. Give it a try@mint mobile.com Switch upfront.
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A
Busy taxes and fees extra see mint mobile.com.
- [41:11]
D
AI is hungry for power and so is everything else from computing and transportation to industry. Energy demand is reaching historical historic levels and batteries are emerging as the backbone of modern infrastructure, enabling reliable, low cost storage at scale. J.B. straubel, CEO of Redwood Materials, which deploys these strategic resources, spoke to Bloomberg's Judy Fine at Bloomberg Any f yesterday in Houston.
- [41:36]
G
Energy storage is evolving. Batteries in particular are evolving to play, I think an incredibly central part of the story, you know, for the expansion of data center energy availability, but for the grid overall and increasingly I think people are beginning to sort of see that opportunity where if you can have the flexibility that energy storage provides, you know that that gives you the chance to have access to more energy from the grid and it also gives you a chance to manage and adjust the transients from some of these, these, these new loads, especially training loads.
- [42:12]
A
Let's talk more about infrastructure now, but let's talk about the data center side of it. David Sneiderman here with us, senior managing partner at Magnetar Global, head of alternative credit and fixed income. Magnetar has a cool $20 billion in assets under management. Key investor in AI compute provider Core Weave. And you've just come off the heels of an investor day. It's a 20 year anniversary. And how much is the demand from your investors, investors to get more into a data center, to get more into compute and the way in which you finance it?
- [42:40]
G
You know, first, thank you again for having me. I always love to come on the show. You know, we, like you said, we had our 20 year investor day yesterday and just to take you into the room, I think we had six different companies present on six different industries. Everything from, you know, health care finance to restaurant finance. And then like you said, AI infrastructure and our newest investments in energy. And you know, for us the, the way we invest, the formula has always been the same. It's really by being value added to, to our portfolio companies.
- [43:16]
A
And so how are you value added to a core if, how are you thinking about financing the gpu, the compute they need to go out and buy to fill their data centers, for example.
- [43:24]
G
That's right. So for us it's, it's really about thinking about the asset first. Right. Understanding the value of that asset, understanding the customer contracts and then helping the companies unlock value from there. But you know, I think what, you know, infrastructure, we talked about it a reasonable amount yesterday and it really comes down to, you know, three things. It's skill, it's scale and it's scarcity. So I'll start with scale. When we started investing in core, we've, we're talking about 100 GPU clusters and we thought that was going to be difficult. You know, now they're putting in 100,000 GPU into clusters and they're going to do million GPU into clusters. And so the scale is just massive.
- [44:09]
A
Yeah, right.
- [44:10]
G
Then you go to the skill and what you compare it to is it's like an F1 car instead of, you know, your family sedan. This is really, really hard to do. So companies like Core Weave, they're one of the few in the world that can actually do this. And then to your question, is the scarcity? People say there's not enough GPUs and not enough power. But the issue is the demand. The demand is just off the charts. Today, every company we talk to, you know, our entire channel check. Just as everyone needs more, more GPUs.
- [44:42]
D
David, can we talk about how Magnetar muscles in on any project? The headlines that cross the Bloomberg on a weekly basis at the moment are about the great scale AI Neo cloud infrastructure projects. But you have like legacy finance coming in hard strategic partners, because the size of the check to get the project off the ground is getting bigger and bigger and bigger.
- [45:06]
G
That's right. And it's a great question. You know, a lot of, a lot of the capital that's come into private credit has been this one size fits all. You know, let's make sure the mandate fits into insurance company type of money. That's just not what we do. What we do is we go in and we want to be value added to partners and help unlock value. So we want to sit with management teams and talk about how to lower their cost of capital over time. And that's why they bring in a Magnetar.
- [45:34]
D
David, where and what is the next call we for you?
- [45:38]
G
You know, for us it's a diversified portfolio approach. So we're always thinking about downside first. So we're going to look at the assets and contracts but then it's how do we help unlock value? And so even yesterday that a tourist energy, a tensor wave. These are the companies that are up and coming right now and you know, they spoke very eloquently about their businesses yesterday.
- [45:59]
D
David, is there an opportunity for you and are you literally going to participate participate in what was announced from the United Kingdom this week, all the heavy infrastructure investment from America's biggest technology companies?
- [46:10]
G
You know, for us we're looking across all projects and again, if we're not really value added and helping lower the cost of capital, that's not where our skill set lies lies best. And so for us it's really getting involved with management and helping them make decisions. Given the data that we have inside of our firm.
- [46:29]
A
There's almost a core wave just launched in the uk N Scale. I mean again, a crypto miner that pivots into compute and they the sort of companies that are interesting.
- [46:38]
G
Sure. I remember having, having dinner with N Scale, call it six months ago in Chicago at Morton's. That's right. Those are exactly the type of companies that are interesting and for us we have to really make sure that we're thinking about our capital and we're thinking about our investors and making the appropriate.
- [46:54]
A
Allocations just for our audience that is savvy on financing and is savvy on data centers. How do you lower the cost of financing?
- [47:00]
G
So it's really about the customer mix and the asset mix. And so we're really trying to think about, you know, how we take a customer mix. So if you have all non investment grade customers, that's a much, that's a much more difficult portfolio to finance. Now you want to have non investment customers because they grow very quickly. So now we have to think about the mix of, of customers underlying your portfolio and help you make those allocation decisions. I think that's how we can get involved with the companies themselves. We can be value added and really unlock value for them over time.
- [47:33]
D
David Snyder, the managing partner at Magnus Capital, Great to have you back on the program. Thank you. Now coming up, Google brings Gemini throughout the Chrome browser. We've got more on that story next. This is Bloomberg Tech.
- [47:52]
A
Time now for Talking Tech. First up, Google brings Gemini throughout the Chrome browser for users in the United States. Just two weeks after dodging an antitrust case that could have broken up the company, it will also be integrating Gemini with other Google apps like calendar, YouTube and maps. Meanwhile, me will deploy an over the air software fix to rectify a problem in its advanced driver assistance technology installed in almost 40% of the SU7 electric sedans is sold now. The recall comes nearly six months after a fatal crash involving a standard version SU7 sedan that in its autopilot function turned on. And Softbank's Vision Fund is considering cutting as much as 20% of its staff, according to a source. Now the reduction extends years of cutbacks at the Vision Fund as the unit shrank in importance next to growing appetite for big bets from founder Masayoshi Son.
- [48:41]
D
And that does it for this edition of Bloomberg Tech. Karen what an addition it has been. What a week it has been. We broke the headlines from the call between President Trump and China's Xi Jinping. That was what the market was waiting for. Don't forget, check out the podcast. This was a website worth recapping. You know where to find it on the Bloomberg platforms, bloomberg.com the terminal and online at Apple, Spotify and iHeartRadio. From San Francisco and New York, this is Bloomberg Tech.
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