Bloomberg's Caroline Hyde and Ed Ludlow break down Microsoft's 'historic' alliance on artificial intelligence with labor unions. Plus, global regulators examine Microsoft's $13 billion investment in OpenAI, and the EU strikes a deal to regulate ChatGPT and AI.
From Marhart where Innovation, Money and power Collie in Silicon Vallet NBN.
This is Bloomberg Technology with Caroline Hide and Ed Lodlove.
I'm Caroline Heyde of Bloomberg's World headquarters in New York, and I'm Ed Ludlow in San Francisco.
This is Bloomberg Technology.
Coming up. Microsoft and labor Unions. They form a historic alliance on artificial intelligence. While the software giant's president says there's no guarantee that AI won't displace jobs, will break down the announcement, and.
As global regulators examine Microsoft's thirteen billion dollar investment in Open AI, the company has a simple response, it doesn't own a stake. Will discuss the antitrust concern SLUS.
The EU reaches a preliminary deal in what's seen as a key part of the word well's first comprehensive I guessed it artificial intelligence regulation. We'll discuss that and so much more throughout the hour.
The big piece of news is Microsoft. Actually there were two pieces of news. Is news news On the one hand, this kind of relationship with afl CIO, a broad agreement with unions to cooperate on artificial intelligence. The other more specific piece of news is a case study involving a few hundred staff and a very specific video games unit where AI has been brought into the collective bargaining agreement. I want to bring in Bloomberg's Jackie Davlos. She is the host of AIRL on Bloomberg. Let's start with the video game unit. Tell us the details of what happened overnight.
Well, the Communication Workers of America basically agreed with Microsoft that they will be allowed to incorporate some AI language into their collective bargaining agreement.
And that move was really one.
Of the first where you saw Microsoft agreeing to have some language in those contracts. And that goes hand in hand with that broader announcement that we saw today in collaboration with afl CIO. Now, many people may not realize that this labor organization encompasses over twelve point five million workers. That includes other affiliated unions like SAGAFTERRA, like the Writers Guilled, the Teachers' Union. So a real broad based organization coming together with Microsoft in one of the first partnerships of its kind that is tackling how to handle artificial intelligence impact on workers, what they can do to both come to the table and say where are workers being impact and how can we best prepare them?
And to that end, we had, of course, President of Microsoft, Brad Smith saying, like, look, honestly, I cannot say that Joels won't be impacted and indeed become obsolete due to AI. How straight toolking. We'll see at the announcement Jackie.
He was very candid because you had a room full of people who have serious questions. You had teachers who were wondering, how is this going to impact my students? Randy Weingarten, the president of the American Federation of Teachers, sorry, the Teachers' Union basically also they're in collaboration with Microsoft, saying we want to understand how the company is going to help us understand what artificial intelligence is doing to our teachers, to our students, what can we do to prepare them? And two things came out of this partnership. The first being you have Microsoft agreeing to basically host some training sessions for workers across the board. How is artificial intelligence being developed?
How can it affect you?
Basically kind of giving them the AI one oh one on what the technology is. The next being how can we incorporate your feedback into the room where developers are creating this technology. And the third is where can we team up on policy proposals. They said they want to quote join forces on putting forth legislation. When you have members of the Senate in Congress basically coming together and saying, well, we're accepting suggestions and the two want to create an alliance of sorts to put together some proposals that are the best interest of workers. Now, the other thing is that came out of this is basically saying, look, we Microsoft understand that the collective bargaining process is important and we don't want to stand in the way of that. And so the agreement also includes kind of this neutrality template, basically terms that can say we're not going to stand in the way of or people organizing. And that's a big step coming from a technology company. It really puts the spotlight on other companies like Amazon, which have not taken such a friendly approach when it comes to their workers organizing.
Great context, Jackie Davilos, thank you so much on the world when it comes to Microsoft and the Laby unions. But meanwhile, Smith and Microsoft in general, they've been busy because of course having to defend that relationship with open Ai as well. It's been drawing a lot of scrutiny from global regulators, and the software giant has a simple argument when it comes to its investment in open Ai, and it hopes it will resonate with anti trust officials the messages it doesn't own a traditional stake in the startup with US. Now to discuss is Rebecca Allensworth, professor at Vanderbilt University Law School, And all of this comes about from Friday. We understand first the UK the CMA, they're wanting to start sort of requesting people's input as to whether or not de facto Microsoft controls open Ai more than would be well seen on the surface of things. Then we have the UK, as the US as well regulators here looking into the relationship more broadly. From your perspective, from a legal perspective, how strong is the argument that Microsoft is some way acquired open Ai.
I think we don't know the answer to that question because we don't know the terms of that deal. I mean, you'll notice that he said traditional steak. So what I want to know and I think what the FTC would want to know, and the CMA is well in what sense do they have a non traditional steak. There's some reporting that they have a non voting seat at the table, a position on the board. Is that going to be a situation where that member says, hey, I'm not voting on this, but if you vote for this, then I think Microsoft will pull out. That could be seen as de facto having some kind of control, and that could potentially raise antitrust problems.
So here's what we know about the structure.
Based on Boobog's reporting, the thirteen billion dollars to date did not equate to taking an equity investment. According to Boonbo's reporting, Rebecca, it was that Microsoft would derive half of the profits open Ai generates up into a capped limit due to its closed profit model. And that is the argument that Microsoft's saying it is not a state because it was not an investment in return for equity. The question is do regulators or will regulators by that.
I think it's an open question that we don't really know the answer to. So anti trust law is not well positioned to challenge investments. It actually is specifically said in the Clayton Act that acquisitions that are merely an investment essentially that don't involve any decision making authority are not covered by that statute. And likewise, if we're going to talk about Section one of the Sherman Act or Section two of the Sherman Acts, other ways of challenging it under anti trust laws, I think the regulators would have to see this as some sort of merging of decision making authority, and I just don't think that we know. At the same time, the antrust laws are pretty flexible about determining whether or not there is some de facto decision making authority, so this won't be decided merely by the corporate form. This will be a fact intensive inquiry and the facts I think we don't have yet.
When we have to. Therefore, try not to speculate on facts, but instead look at really what legal groundings. The FTC has pursued a number of well cases of late where ultimately they haven't won out, but they've been trying to sort of swing the perception of where regulators should start to get involved, what really consumer protection looks like. Over in the UK, we know the CMA sort of backed off from its original view of Microsoft and activision in but did force change on that particular deal. What do you think ultimately is trying to be got across here? Are they worrying about some sort of ultimate monopolization that could go into the world of artificial intelligence, and how do they get ahead of that curve?
I think that's right, and I think the concern here is, like so many of the FTC's actions happening right now, which is a major deep pockets competitor, one might say a monopolist, although I think in this case that's a little bit of problematic. Holding an input that everybody needs to effectively compete, and that input here is the GPT model, and the idea would be this is going to become essential to compete in so many markets actually, and if it's controlled by one single entity that has the power to bring it to market and can exclude other people who might compete, that could be really bad for competition. As you point out, though, that theory of competition, which is not about head to head, it's not about Microsoft competes with the chat GPT.
Product right now head to head.
That makes it a little bit of a different type of challenge than the antitrust laws have been used to over the last forty years. It's not precluded by the statute, but it is a little bit unorthodox.
How much weight do you think a regulator would give to the idea that there are now many companies offering similar foundation or large language models. They're not the same as GPT, but there are other models out there.
So this is a great.
Question because this has always been a problem in anti trust and what you're talking aout about it's basically market definition. Is the market the chat GPT model because it is so different, it is so important, it does not have a substitute that we're prepared to call that a market, or is the market as I'm sure Microsoft and open AI will be arguing artificial intelligence, which of course is broad and people have been using artificial intelligence, you know, for many, many years, and there's a lot of competitors within it. The question should be about substitution. Is there a substitutable product for open AIS technology? And I think that is a pretty good argument that the answer to that.
Question is no.
Oh thanks to Rebecca Allen's work, professor at Vanderbilt Law School there on potential interrust action against open Microsoft.
Right coming up on the show, European.
Regulators striking a landmark deal to regulate artificial intelligence. We'll discuss with Ashley Casavan, Managing director at the iapp's AI Governance Center. That's our conversation to next. This is Bloomberg technology.
That we lose control of the machines I think to some extent, and the howser still very much being debated obviously, of having the fail safe mechanisms in place that humans can override the systems. That's probably the single largest thing I think and worry about, is that if the machines can be or the algorithms or there was being generated, can be developed in such a way that there is no fail safe mechanism that it can be overridden by a human.
That's what worries me.
Those Armed CEO Renee has speaking exclusively to Bloomberg back at the end of November about his concerns regarding generative AI. He shares concerns with European regulators, who over the weekend reached a deal to formally regulate the technology. Joining us now with more is as Casavan, Managing director of the International Association of Privacy Professionals AI Governance Center, one of the largest and most comprehensive resources for global privacy and information. There is a lot in this EUAI Act. The top lines as I see it, is the acceptable use policy, some disclosures about the data.
Used to train models.
What is your kind of takeaway on the depth of how this has been regulated in Europe?
It's quite significant.
This is definitely a landmark deal that has broad implications, not just for European companies, but companies all over the world. I think that the fact that they're really looking to align with international definitions or following and changing through these discussions to OECD definitions, indicates just how big of an impact this will have globally.
The whole difficulty was on one side fostering innovation, on the other side, well, protecting the rights of people the user, and of course this is why what it was a thirty seven hours of negotiations that took place. Actually, from your perspective, does this in any way protect and ultimately innovation in Europe because many will worried about some of the startup's mistyle for example in France.
Sure, I think that it's really to be determined how this is going to be enforced and the implications. But I do think that what's been drafted is really what we've seen from the dialogues, because we haven't actually seen the text of the final Act will be left to how it's enforced. That said, I do think that really relying on product safety assurance mechanisms like third party audience will hopefully provide that balance between innovation for companies and then protection of the public.
What's notable, of course, is yes, we've had an EO here in the US. Yes we've had much talk of regulation, but ultimately this is the first time you get real fines being outlined. I mean, look, they only add out to about thirty five million euros, but that's a lot if you're a small company, and indeed it could be seven percent of global turnover for big companies. Jerry Breton, of course, key negotiator in all of this, trying to drive it across the line when it comes to the EU. He was talking about basically how much the EU is leading here, is it? And how much do you think this is going to set the scene for the global AI players here, because ultimately it's only open AI that seems to be affected thus far.
It's a great question.
It's funny that you're sharing that that post. I guess is what we're calling tweets now, and the reason why is because there's been a lot of conversations in nations all over the world.
You mentioned the US's.
Recent AI Executive Order that's really looking to understand the implications of these systems and drive some good guardrails around how to again kind of balance innovation, protect the public, but even really think through what different implications of these systems are, given that AI is not one specific thing, and I think that getting there was a lot of countries that wanted to get to the gate first did get some regulation out there, and so it's great that Europe did that. But I do think that there's actually a converging of a lot of these different guard rails in different formats all over the world.
Actually, whether it's at the parliament or commission level in Europe or Congress here in America, do the people writing the rules and the regulation have a deep enough understanding of what it is that they're regulating.
It's definitely going to be a resource implication in any country that's looking to over see some of these rules. That said, I don't think that they're doing it alone. We've seen how there's been a large amount of public participation in these processes, civil society organizations providing feedback on an ongoing basis, companies that are brought to the table through not just some of this drafting dialogue, but as we've seen with some of the voluntary codes that have come out and that we're even referenced in this through in the work from the Commission, the G seven Hiroshima process, that those companies are at the table providing inputs, and I think we'll start to see that through enforcements. And again there's a reliance on standards which are typically developed by industry.
So I think it's a bit of a misnomer.
To think that it's just going to be relying on resources provided by the government.
Public and private relationship one that you know well actually of course previously data and digital for the Government of Canada. So having to look around the AI and responsible AI a long time before all of this. Actually, Kasavan, sorry, we thank you so much, Managing director of the iapp's AI Governance Center.
Time for talking tech and first stuff in the news. Apple said over the weekend that it shut down third party applications enabling Android devices to use I Message to communicate with iPhone users, citing significant risks to user security and privacy, and shares with the South Korean firm wider Planet, which uses AI to produce advertising, jumped sixty nine percent in two sessions after it said that Squid Games lead Star would become its biggest shareholder with three million shares plus. TikTok agreed to invest one point five billion dollars to combine its shopping businesses with Indonesia's go to group. TikTok gets a seventy five percent stay in that combination, which will run it shopping features in Indonesia, the company's biggest online retail market, Carrot.
And let's talk about e commerce more broadly in the globalization of it because a little known PDD or pinto duo has been surging in China. Now it's Timu discounts app. It's rivaling Amazon and Walmart here in the United States. On Bloomberg's latest big take, we take a look at how the company's behind the addictive app is actually outpass outpacing Jack mars Ali Baba also in terms of market capitalization. Now it's even earning the celebrity CEO's praise. Bloomberg expensive Sofa joins us now for what has become a bit of an American addiction too. They might not know that PDD is a company behind it, but it feels like everyone's using Temu.
Yeah, it's come on into the US by storm in a little over a year. Is really starting to gobble up spending in market share. It had its big Super Bowl advertising blitz back in February, you know, saying shop like a billionaire. You can can splurge as if you have a ton of money, even if you don't.
It's really like.
An online dollar General in your phone, you know, just a broad assortment of stuff, very very low prices, and then the sacrifice US shoppers have to make is waiting for delivery time.
So that would be the downside.
You're gonna you're gonna get prices you can't beat anywhere else, but you're gonna have to you have to wait for the stuff to come to your doorstep.
Hey Spencer, what's the threat to your main beat company, Amazon dot Com?
Well, I think right now that the threat is exactly that price sensitivity. Is it going to win some of the market share from Amazon, especially maybe like a stocking stuff from market share Amazon CEO A. D. Jasse has given interviews where he says, you know, their customers are still being pretty cautious. They're not buying big ticket items. They're buying the low cost things. They're buying the consumables. That's right where Timu is. You know, most of the products are are low cost ten twenty bucks. And then they also seem to kind to grab you a little more with a social element. They have a lot of games in the app. If you open it, it could almost be like overwhelming and jarring. It's like a like a casino in your phone with lots of spinning wheels and games about raising fish and farming. So they try to kind of suck you in and grab your attention and not just your money.
Bloomberg expense is so for a part of the team with the big take and all the things findor Duo and Timu, thank you very much.
Welcome back to Bluemore Technology. I'm Karen Hide in New York and.
I met Love Low in San Francisco.
Quick checking in the markets and two stories that have been driving moves to start in Europe with Worldline. This is a fintech company that closed up one point five percent after Bluebelt, which is basically an activist investor, said get rid of the chair and change the board. You'll remember Worldline, it was a stock that at the end of October fell sixty percent in a single day after it basically dramatically revised its growth for car and everyone said, what on earth is going on? Blue Bell saying let's bring some confidence and trust back to that name in the fintech space and calling for those changes, which investors responded to positively. The other one is an earning story. Oracle is put reporting earnings after the Bell, just a big focus on their data center business. It's about a third of revenue. But the story is can they get access to the high performance GPUs that they need to build out data center infrastructure relevant to the AI story both on the training and inference side. We have so many people on this show, Carr that come on and say, why are we not talking more about Oracle in the same context as the other hyperscalers.
They can offer the same thing.
There's a big addressable market out there for people who want to train foundation or large language models. Oracle just needs to build out its infrastructure.
To support that.
And boy hasn't just AI sucked all the oxygen out of this show and likely the entirety of twenty twenty three when it comes to investment, and let's just go from those public market types of investments to the private the bench Capital side Green is on today's at VC Spotlight. He is a founding managing partner of lead Edge Capital growth equity firm five billion dollars in assets under management, investing across public private tech companies and also looking for areas of liquidity when it comes to the secondary market. Mitchell, I'm interested as to how much you think AI is just going to be the play for twenty twenty four, whether it's buying on the secondary market or indeed investing in early rounds.
Thanks so much for having me. And I think that there's gonna be a lot of things going on. It's not just AI.
You know, there's a lot of interesting software companies being built right now, and I think it's a function of lots of different industries are going to be you know, the top of the town is just AI in Silicon Valley, but there's a lot of people build an interesting software companies outside of AI.
Mitchell.
The Friday lunch time that Sam Outman was fired by the then board of open AI. I don't think many of us will forget, but the story I was looking into that week was the shocking liquidity on the secondaries market for open ai shares, largely through SPV transactions, some of which blocks of shares or units of SPVs. We're valuing open AI at one hundred billion dollars. I don't think our audience knows just how liquid markets for shares of open AIS SpaceX are. Which names do you expect to be in this big twenty twenty four market that you've outlined.
I think you're going to see in an area in a world where investors, so people who invest in funds are limited partners, they are you know, demanding investors private equity funds give capital back to their investors, in which case people are going to look to secondary markets to sell. I think you're going to see, you know, continue to see increase in companies, you know, turning into selling stuff through SPVs or secondary markets. You're going to see a lot of continuation funds. Anything that drives DPI, which is money back to LPs on that basis, is going to be a focus.
It because it's it's funds trying to.
Return money to their LPs, and you know, with a slow IPO and M and a market that's just going to be exaggerated.
Well that's my question.
Is all this activity in the secondary's market a precursor or leading indicator that we will start to see more primary rounds and more listings or exits in twenty twenty four.
I don't think it's a h think. I don't think it's a precursor to it. I think it is a it's a result of not having an IPO market right now.
Why I've seen it.
That being said, they'll go going all the way back to you know, Facebook and Ali Baba and Twitter and Uber. There's been secondary markets for a lot of these big companies, even in robust IPO markets.
I think you need to FED.
I think investors need to get confident that the FED is done raising rates. I don't think they need to lower them a bunch for the IPO market to happen, but I think are to pick up.
But I do think they need to get a sense that rate rising is done, which you know, who knows.
I expect we'll see more tech IPOs in twenty twenty four than we saw on twenty twenty three.
But that's not very hard to do. You don't need many.
Well said Mitchell. I'm interested because you, of course that lead edged capital do take part in the liquidity movement and buying up on the secondary market. And one of the valuations that we're looking at, I mean, we were hearing of the top evaluations. It's still getting for an open AI. But while a lot of these gps are going to be under stress from their LPs to be well selling out, perhaps at evaluation that isn't as high as it was previously.
Yeah, so I think twenty twenty four will be.
Or maybe not twenty twenty four, twenty twenty four, twenty five, twenty six will be. You're going to see a lot of down round IPOs and that doesn't mean anything. That just means a handful of fools who paid a higher price in the last round are now paying you know, are now having a down round.
Doesn't really affect the company they raised. The company is actually really smart.
They raised money at X and when they decided to list the shares they became lower than XT.
That's fine, there's nothing wrong with that.
But you know, and very few of these investors have blocks on these IPOs. So I actually think you're going to see a lot of down round IPOs start to happen.
It's going to take time. Now again we've seen them before.
Stripe was like a down round IPO, and by the way, down ound ipo.
Doesn't mean anything.
It can still be a great opportunity to buy the stock over the long term. That just means at that point in time, somebody at one point was going to by a higher price. I think you're going to continue now in the secondary markets, it just depends. I think the price of open Ai probably is a bit nutty, but what do I know. Look, there are interesting opportunities, and are in a world where gps need to you know, people that run funds need to get liquidity.
There's probably interesting.
And I've been sitting on positions for a long time, probably you know, interesting opportunities out there. We just bought something at less than fifteen times EBITDA and it's a rule of sixty business, which means it grows you know, twenty five and had thirty five percent ebitdet margians. That doesn't seem crazy to us at all.
So maybe if people are looking to be getting into stripe at evaluation that they find slightly more digestible. They're going to be able to do that in the secondary market right now or indeed better in twenty twenty four. Who are those buyers at the moment, and indeed, who do you tend to be the sellers in this particular type of market.
Yeah, that's a great question.
So on the on the cell side, it typically could be an early a fund that was an early investor in it. It could be a late investor that just needs to get liquidity to their LPs, your crossover hedge fund or something. It could be an early employee or a former employee, an early angel investor, and it just think abouting that own stock at my own liquidity. On the buy side, you know, depending on the type of company, there are a lot of secondary funds set up to do this, whether it's Globe and Sachs's secondary fund, you know, Blackstone secondary fund, Lexington Collie, or there's a bunch of them. Also, people like Industry A Ventures, We obviously participated in secondaries. Additionally, existing investors in the company often have you know, writer first refusals to buy stock in these businesses, and if the prices are attractive. They often do you know, and then other other venture firms and if they want exposure to a company, that's another you know.
We we've become big.
Through a business called transfer Wise, and it was primarily through company facilitated secondary because there are two types of secondary transactions.
I mean there's multiple year involved, so it.
Could be company facilitated or just like you know, one off rogue and rogue isn't bad.
It's just different ways.
This depends on sometimes their company organized secondaries.
Mitchell, quickly, what was it the name that you bought at fifteen times E?
Does I make?
I can't think that it's just a software company.
I would assure you that not one of your viewers has ever heard of the company.
It makes time tracking software.
Interesting. We'll dig into it.
Michaell Green founding, a managing partner of lead Edge Capital. Deep dive on the secondaries market. We're doing that more and more on the show. Thank you very much. Now, coming up, Elon Musk reinstates Alex Jones's account on X after a five year fan We have the details. Next, this is Bloomberg Technology appsent websites that use AI to undress women in photos.
Are soaring in popularity.
In September alone, twenty four million people visited undressing websites. That's according to the social network analysis company Graphica. It's all part of a worrying trend known as deep fake pornography. Bloomberg's Margie Murphy joins me on set with her reporting. At the center of that reporting is also data around the volume of advertising behind those apps and sites and where they're being advertised.
Right, So one of the big problems here is that these app developers are getting a load of free marketing using social media platforms. So we saw a two four hundred percent increase from last year according to Graphica of referral links on x and Reddit, and you can see if you just search keywords that are associated with these kind of apps that the adverts pop up their accounts. Underneath them there are pictures of women all kind of teasing and winking at you, saying come come.
If you follow this link, you'll get to this app.
And it's just a free way for them to provide their services. But the social networks since her reporting came out, have said that they're cracking down on it, but it's they've kind of had free marketing for a good year now.
I mean some of them have also paid for sponsored content on Google's YouTube, for example, and a Google spokesperson so the company doesn't allow ads that contain sexually explicit content. But Margie, the also really worrying thing is a lot of the people who are being sort of undressed don't realize ultimately. And also, I mean, of course it's a deep fake, so it's not actually real, but there's no sort of legal recourse to this from a federal level at the moment.
Absolutely, there's no federal law at the moment that prohibits non consensual deep fake pornography. And it's something that people I've interviewed about this research is experts in AI are really concerned about because we've heard for years about celebrity deep fake pornography, which is awful, but now we're really seeing normal people becoming part of this story. BusinessWeek we had a cover story recently about these awful story about some high schoolers in Levittown and they were deep faked. They actually found the person who deep faked them. But it's just one story that I think will just keep happening, and we're just going to see more of it because there's no legal recourse for victims and the technology is just kind of spiraling out of control.
Really extraordinary reporting that both you and Olivia and the team of Bloomberg continue to do on it, Margaret Murphy, and we thank you for breaking that particular really unnerving story down for us. Meanwhile, sticking with the world of social media, Elon Musk has restored the account of right wing conspiracy theorist Alex Jones on X after users themselves voted for his reinstatement, and of course it was what some five years after his initial ban, Luma's Kurt Wagner joins us for more and not only was he reinstated, he then was well put onto the X platform. In an audio recording with Elon Musk plus Alex Jones plus others some lawmakers to well discuss his return. What did you make of it all.
Cut, Yeah, this is a kind of what Elon has been doing since he took over the company, right, is that he's been kind of rescinding a lot of these rules and punishments that Twitter one point zero had put out, and not only that, but welcoming these people back with open arms, giving them a platform. You know, by Elon showing up on that spaces chat with Alex Jones really you know, kind of bringing his audience along to Jones's you know, rhetoric and message, right. And so I think this is all part of Elon's plan to sort of drastically change what he views as X versus Twitter and to you know, reimagine what this company is.
Supposed to look like.
As Caro outlined, Musk did a poll, right, asked the user base vote on this. I think it's worth reminding our audience the origin story why Alex Jones was removed in the first place.
Yeah, so he was banned back in twenty eighteen.
He had been a repeat rules violator under Twitter's prior management. You know, I believe the last straw is ultimately that he had come out and sort of attacked or been attacking members of the media. If I recall, I think he even said something in a video of his around you know, get your battle rifles ready for the media, right. And so he was banned ultimately for violating the rules around you know, harassment and glorifying violence, and so, you know, those are the types of things of course that Musk has sort of said he doesn't care much about right. As long as something is not illegal, he thinks it should be fine. And so that's why we're seeing a lot of these people that Twitter one point zero had banned or punished start to return to X.
I mean, of course Elon did say I vemently disagree with what he said about Sanny Hook, but as a platform that believes in freedom of speech, or are we not? But what's notable is November twenty twenty two he posted saying and this of course is an emotive subject. For crucially elonam anymore, his firstborn child died in his arms. I felt this last heartbeat. I'm no mercy for anyone who would use deaths of children for gain politics of fame. So we sort of did in about turn. Now what's interesting in all of this, and we make a sort of a movement here to a different story that's occurring on X, is that another voice has taken actually sort of off the platform to start a different version of subscriber growth for himself. And I just want to ask you about Tucker Carlson. Of course, we understand he's not launching a new news service on X, when in fact he's doing a streaming service of his own, called Tucker Carlson Network, and it seems as though it's he explored launching on X but it didn't work outcut.
Yeah, well, I mean, the thing is that there's a reason that X is not TV, right, And we saw them try to do this. You may recall many many years ago in twenty sixteen, they kind of tried to make Twitter a streaming service, right, They got the NFL on there, they got a bunch of deals with other media publishers, and it just didn't work. And so I think that Twitter or now X obviously usually serves best as a compliment to TV. And my guess is that Tucker Carlson probably figured that out himself as he was trying to build up this new platform. And so I have no doubt, given his relationship with Elon and the fact that they seem to be buddy buddy, I have no doubt that X will continue to be sort of an important distribution channel for him. But you know, x's nonve video or TV service, and despite Elon's ambitions, you know, they haven't been able to turn it into one yet.
The mess Kurtwagner, good to have you back after a few weeks and months away from the show, Kurt Wagner, they're out in Denver, Okay. So today's going viral. We're looking at Apple, the iPhone maker, offering incentives to artists and record labels to produce music using a spatial audio technology that surrounds listeners in sound. Starting next year, the company plans to give added waiting to streams of songs that are mixed in Dolby Atmos technology. According to Bloomberg sources, that could mean higher royalty payments for artists who are the first to embrace the technology made by Dolby Laboratories.
Caroline, let's stick with Apple and well turn our attention to health to wellness. In twenty twenty four, Bloomberg reportedly showed that Apple is planning on an updated watch that will tech to tect potentially blood pressure, sleep, ATNA, and much more. For us to just discuss that where we are with wearables, where we are with digital fitness, how we're consuming it. It's a CEO of future. It's a company that pairs users with coaches and is backed by investors such as Clena Perkins, Coase ad Ventures, found Us, Fun, and many more. But please to welcome, Rishie Mandel. Great to have you here. And ultimately we are seeing this new type of relationship with us and our fitness and actually knowledge of our own wellness at this moment. How much that being driven by wearables, VR and the like.
Yeah, there's one hundred million plus wearables out there now and better than ever.
We can understand each individual.
What's interesting is the history of health understanding in the Western world is actually based on men recruited study small populations, and so imagine a world where now we're getting inputs about every individual, how women's health might change and evolve. That's really exciting to see. As you said, the consumers thinking a lot about health and fitness, and in an AI world, oftentimes the biggest winners are those who have the largest proprietary data sets. And so you think about a company like Apple, now not just has how you're moving through the world, and maybe blood glucose and certain types of markers bridging across all that information can help tailor to an individual better what they should be doing, when, why, and then you can build really innovative delivery mechanisms on top of that.
Yeah, I mean, I've been sort of a guinea pig to certain extent got a wearable ring because it was meant to be a better for women tracking cycles and the like, But ultimately I haven't found it that good at it. It didn't realize I had COVID. I have no idea if the calorie content is actually true from what I'm currently monitoring point, but I am interested in your perspective. How many therefore are using you from women versus men? What are the demographics who are coming to your platform when wanting this one on one sort of service at the moment.
Yeah, no, And I love what you're talking about about the lack of accuracy or frankly, a lot of that data is just hard to parse through on your own. So with future, we match every single person with a coach. Now that coach is AI assisted able to sift through so much data, not because they're manually doing it, but rather we've built some technology to allow them to spot trends, interpret different markers about you. And so right now what we see is a lot of AI is rudimentary in health, and what we're going to see over the next five years I think is an explosion of this idea of augmented intelligence taking your physician and making sure they're backed by the latest and greatest armed with that information, taking a radiologist, maybe double checking a scan to make sure they don't miss something.
But there's still that human there.
And with Future, that's what we see is with fitness, we give you a coach.
That coach is highly assisted.
And building your program, your training program, whether you're running outside, working out in a gym, at home, or all three, which is very common. And then we actually use a lot of AI to help augment for that coach. What's hav a day to reach out to Caroline and what's the right thing to say and what are the trends that we're observing. That augmentation I think is really powerful. And to answer your question, it's about fifty to fifty men and women who reach out to get a coach on future.
Hey, Ritchie, real quick.
Is it fitness that's going to be the driver of wearables adoption or is it health data that's going to be the principal driver?
You know, the reason we started with fitness is because there is a daily and very common interaction with fitness. People typically who are engaging with it are doing it daily weekly. That kind of cadence. And what I was saying earlier is the biggest winners in an AI world are those We have the largest proprietary data sets, and so when we interact with a member every single day, we can come to understand their life in a fulsome way. Our average member will trade three text messages every single day with their coach one thousand a year. Lay that on top of the biometrics we get from wearables. Lay that on top of the understanding of your behaviors, and now you have a really big picture.
Rishi Mandaw wish we had longer future CEO there. That is it from this edition of Bloomberg Technology