From Marhard.

From Marhard.

We're Innovation, Money and Power Collie in Silicon.

We're Innovation, Money and Power Collie in Silicon.

Valley, NBN.

Valley, NBN.

This is Bloomberg Technology with Caroline Hyde and Ed Ludlow.

This is Bloomberg Technology with Caroline Hyde and Ed Ludlow.

I'm Caroline Heider Bloomberg's World head quarters in New York, and I met Ludlow in San Francisco.

I'm Caroline Heider Bloomberg's World head quarters in New York, and I met Ludlow in San Francisco.

This is Bloombay Technology.

This is Bloombay Technology.

Coming up after staying out of public view for years.

Coming up after staying out of public view for years.

Ali Baba founder Jack mart.

Ali Baba founder Jack mart.

He speaks out to his own employees, urging them to correct the company's course. We'll have more on the e commerce giants' plans to compete with rivals like PDD, and.

He speaks out to his own employees, urging them to correct the company's course. We'll have more on the e commerce giants' plans to compete with rivals like PDD, and.

We'll hear from Amazon Web Services CEO Adam Zelipski off the back of the company's Reinvent conference discussing AI, Nvidia, and a lot more.

We'll hear from Amazon Web Services CEO Adam Zelipski off the back of the company's Reinvent conference discussing AI, Nvidia, and a lot more.

Plus Apple offers Gommen Sachs an exit ramp for its troubled card partnership. We'll bring you those details so much more throughout the hour. Let's just go to what this macro picture looks like. We're just looking through the bond market. We're looking at the impact on the tech sector. More broadly, Let's launches is with us senior portfolio manager over at Invesco and Well and the amount of run up that we've seen in tech stocks has been phenomenal for November, and we know how much it's led the benchmarks.

Plus Apple offers Gommen Sachs an exit ramp for its troubled card partnership. We'll bring you those details so much more throughout the hour. Let's just go to what this macro picture looks like. We're just looking through the bond market. We're looking at the impact on the tech sector. More broadly, Let's launches is with us senior portfolio manager over at Invesco and Well and the amount of run up that we've seen in tech stocks has been phenomenal for November, and we know how much it's led the benchmarks.

Is this going to continue? From your perspective?

Is this going to continue? From your perspective?

Thank you Karen and Ed for having me. We think actually the global yield backdrop that you just highlighted is likely to stimulate a cyclical rebound into your end and into next year. As you alluded to, tech has been driven primarily by obviously a thematic focused artificial intelligence narrative and also supported by the declining global bond yields as of late. But what we think is really happening is that this declining bond yield will lead a cyclical rebound because it's primarily driven by a fall in inflation expectations and actual inflation, which will in our mind create a more supporting narrative for a soft lending and therefore allow market participants to believe again in a cyclical rebound in the cyclical sector. So we do think at tech as are performed because if its quality characteristics is defensive characteristics, it's higher duration characteristics. But now we do expect a rotation more to the sectors and styles that have been neglected and unloved such as smaller capitalizations and value oriented sectors.

Thank you Karen and Ed for having me. We think actually the global yield backdrop that you just highlighted is likely to stimulate a cyclical rebound into your end and into next year. As you alluded to, tech has been driven primarily by obviously a thematic focused artificial intelligence narrative and also supported by the declining global bond yields as of late. But what we think is really happening is that this declining bond yield will lead a cyclical rebound because it's primarily driven by a fall in inflation expectations and actual inflation, which will in our mind create a more supporting narrative for a soft lending and therefore allow market participants to believe again in a cyclical rebound in the cyclical sector. So we do think at tech as are performed because if its quality characteristics is defensive characteristics, it's higher duration characteristics. But now we do expect a rotation more to the sectors and styles that have been neglected and unloved such as smaller capitalizations and value oriented sectors.

Is banks one of those? We're just looking at a banner at the moment. The FDIC coming out with its annual report and actually talking about how profit profits bank profits are dipping as they say ultimately that loans are the next pain point at the moment they're seeing, and most notably they're saying, the banking industry on this quarterly focus has got some unrealized losses that are increasing in the third quarter. So is it now the time to be getting into banks?

Is banks one of those? We're just looking at a banner at the moment. The FDIC coming out with its annual report and actually talking about how profit profits bank profits are dipping as they say ultimately that loans are the next pain point at the moment they're seeing, and most notably they're saying, the banking industry on this quarterly focus has got some unrealized losses that are increasing in the third quarter. So is it now the time to be getting into banks?

I think you're alluding to a very important point. We have now just dealt for over a year of yield creve inversion, which we know creates a particularly challenging environment for financials. The yell cre is beginning to rest deepen, and if we do see rake cuts into next year, a powerful resteeping of the Yil curve would improve materially the four perspective on bank profits.

I think you're alluding to a very important point. We have now just dealt for over a year of yield creve inversion, which we know creates a particularly challenging environment for financials. The yell cre is beginning to rest deepen, and if we do see rake cuts into next year, a powerful resteeping of the Yil curve would improve materially the four perspective on bank profits.

So we do.

So we do.

Place financials and banks as part of the cyclical sector that is likely to benefit together with others if our thesis of a cyclical rebound and resteeping of the yell curve does play out.

Place financials and banks as part of the cyclical sector that is likely to benefit together with others if our thesis of a cyclical rebound and resteeping of the yell curve does play out.

Let's see you take this kind of worldview from a capital allocation standpoint, right, you are kind of more heavily weighted toward equities. But the world of technology is big. We just talked about China, We're increasingly talking about Europe. How do you guys feel about tech in the United States visa v Europe and parts of Asia.

Let's see you take this kind of worldview from a capital allocation standpoint, right, you are kind of more heavily weighted toward equities. But the world of technology is big. We just talked about China, We're increasingly talking about Europe. How do you guys feel about tech in the United States visa v Europe and parts of Asia.

Well, tech the clearest the expression from a global standpoint of the tech theme or that quality theme that comes with a large profit margins, large return on assets. It's really a United States theme. When you go outside of the United States, there is more smaller capitalizations companies that are likely to benefit more from that cyclical rebound. But it's really there is a bit of a polarization happening in the structure of capital markets, as you allude to, where being overweigh the United States relative to the rest of the world basically means being overweight tech relative to value relative to CIICL. Course, they are two manifestations of the same risk and return profile.

Well, tech the clearest the expression from a global standpoint of the tech theme or that quality theme that comes with a large profit margins, large return on assets. It's really a United States theme. When you go outside of the United States, there is more smaller capitalizations companies that are likely to benefit more from that cyclical rebound. But it's really there is a bit of a polarization happening in the structure of capital markets, as you allude to, where being overweigh the United States relative to the rest of the world basically means being overweight tech relative to value relative to CIICL. Course, they are two manifestations of the same risk and return profile.

Sometimes looking a little deeper tells a slightly different story. Right, If you think about the S and P five hundred, communications or information technology both up fifty percent year today, but a lot of that attributable to the Magnificent seven. You know, think about Microsoft and Apple achieve giving record highs multiple times this year. How do you feel about that? What does that tell you about the dynamic of this market.

Sometimes looking a little deeper tells a slightly different story. Right, If you think about the S and P five hundred, communications or information technology both up fifty percent year today, but a lot of that attributable to the Magnificent seven. You know, think about Microsoft and Apple achieve giving record highs multiple times this year. How do you feel about that? What does that tell you about the dynamic of this market.

It's reminiscent of many situations we've seen before where the tech sector in particular is very prone to boost them bus cycles by the very nature of where its return expectations coming from. Right, these are growth stocks with that tend to overreact to extrapolation of growth expectations. We have seen a meaningful run up in the last six months, and the decomposition of market returns that you just alluded to clearly does not reflect the performance of the US economy. Right The S and P five hundred, driven predominantly by the disproportionate tech relative to other sectors, is not representative of US economic performances represented of the tech sector, the dynamics for the market going forward, We believe that there needs to be a rebalance from those Magnificent seven and rebalancing where there's more participation, wider leadership rather than narrow leadership across sectors and industries that should be more reflective of the outperformance that we do see for the global economy and the recovery that we do see for the US economy. So the positive news is that despite a P five hundred being up twenty percent of the day, we believe that that is not reflective of a cyclical rebound that we see in the cards, and that cyclical rebounds still has plenty of room to be priced in through a rotation within smaller capitalizations, more cyclical sectors, and value oriented companies within the equity market.

It's reminiscent of many situations we've seen before where the tech sector in particular is very prone to boost them bus cycles by the very nature of where its return expectations coming from. Right, these are growth stocks with that tend to overreact to extrapolation of growth expectations. We have seen a meaningful run up in the last six months, and the decomposition of market returns that you just alluded to clearly does not reflect the performance of the US economy. Right The S and P five hundred, driven predominantly by the disproportionate tech relative to other sectors, is not representative of US economic performances represented of the tech sector, the dynamics for the market going forward, We believe that there needs to be a rebalance from those Magnificent seven and rebalancing where there's more participation, wider leadership rather than narrow leadership across sectors and industries that should be more reflective of the outperformance that we do see for the global economy and the recovery that we do see for the US economy. So the positive news is that despite a P five hundred being up twenty percent of the day, we believe that that is not reflective of a cyclical rebound that we see in the cards, and that cyclical rebounds still has plenty of room to be priced in through a rotation within smaller capitalizations, more cyclical sectors, and value oriented companies within the equity market.

Talking about this real orientation, it's interesting, colleague John Author's was writing about if you still believe in a run up in overall technology but not the magnificent seven, the way to play that is equal weighted benchmarks rather than going for those ones that take into account the actual overall market capitalization these behemoths.

Talking about this real orientation, it's interesting, colleague John Author's was writing about if you still believe in a run up in overall technology but not the magnificent seven, the way to play that is equal weighted benchmarks rather than going for those ones that take into account the actual overall market capitalization these behemoths.

Is that something that you're seeing plaid a little bit more.

Is that something that you're seeing plaid a little bit more.

Is there other ways that you can still remain exposed to technology but tactically be more long some of the areas that have been beaten off of late No.

Is there other ways that you can still remain exposed to technology but tactically be more long some of the areas that have been beaten off of late No.

I think that's very well said, and it hits the nail in the head if you if you look at equally weighted type of strategies within within tech relative to the market. What they will deliver is is a smaller capitalization bias and a more value orientation. So also when you look at the breakdown of large cup growth versus mid cup growth and small cup growth, you can clearly see that smaller capitalization effect. So I think it's it's for for a portfolio manager, for a portfolio strategy that want that needs to have, and wants to retain a dedicated technology exposure. Rebalancing within that strategy towards smaller capitalization and cheaper evaluations is the way to maintain that exposure and participate to that broadening of the seclical rebound.

I think that's very well said, and it hits the nail in the head if you if you look at equally weighted type of strategies within within tech relative to the market. What they will deliver is is a smaller capitalization bias and a more value orientation. So also when you look at the breakdown of large cup growth versus mid cup growth and small cup growth, you can clearly see that smaller capitalization effect. So I think it's it's for for a portfolio manager, for a portfolio strategy that want that needs to have, and wants to retain a dedicated technology exposure. Rebalancing within that strategy towards smaller capitalization and cheaper evaluations is the way to maintain that exposure and participate to that broadening of the seclical rebound.

Alessia the longest of Investco just a deep, smart take on the technology sector.

Alessia the longest of Investco just a deep, smart take on the technology sector.

Thank you.

Thank you.

Ali Baba founder Jack ma is actually speaking out two employees at the company and an internal message urging Ali Baba to quote correct its course.

Ali Baba founder Jack ma is actually speaking out two employees at the company and an internal message urging Ali Baba to quote correct its course.

We wanted to get into what all of this means.

We wanted to get into what all of this means.

Want to bring in blombergs, Henry Ren and Isabel Lee and Isabelle I start with you because is this a rallying cry? Is this sort of in any way a negative impact? I mean, what does this do to morale when he's bigging up competitors saying that there's an opportunity in AI. Is he meant to be sort of helping with morale or detracting from it.

Want to bring in blombergs, Henry Ren and Isabel Lee and Isabelle I start with you because is this a rallying cry? Is this sort of in any way a negative impact? I mean, what does this do to morale when he's bigging up competitors saying that there's an opportunity in AI. Is he meant to be sort of helping with morale or detracting from it.

So this is really interesting and had shocked a lot of investors because remember in twenty twenty, jackmar largely stepped away from public eye when he criticized Chinese regulators, so many articles were like where is Jack ma? And today he makes a comment. And there are three things to look at this. I think first there is the fact that you can't because to your point, I think it meant was meant to encourage troops. But then we have analysts saying that it perhaps may have been the opposite and deflated them, because why are you commenting? And the second is where and he did it in a forum he and the message is also interesting because he praised PDD, his rival which has grown, which has gone to be a formidable competitor in recent years, and he said Ali Baba needs to course correct.

So this is really interesting and had shocked a lot of investors because remember in twenty twenty, jackmar largely stepped away from public eye when he criticized Chinese regulators, so many articles were like where is Jack ma? And today he makes a comment. And there are three things to look at this. I think first there is the fact that you can't because to your point, I think it meant was meant to encourage troops. But then we have analysts saying that it perhaps may have been the opposite and deflated them, because why are you commenting? And the second is where and he did it in a forum he and the message is also interesting because he praised PDD, his rival which has grown, which has gone to be a formidable competitor in recent years, and he said Ali Baba needs to course correct.

So that's second. And the third is the timing because this.

So that's second. And the third is the timing because this.

Comes shortly after PDD again reported blockbuster results, so I am not sure if it actually motivated folks, but it's really interesting the fact that he commented I would think.

Comes shortly after PDD again reported blockbuster results, so I am not sure if it actually motivated folks, but it's really interesting the fact that he commented I would think.

It is a surprise in and of itself that somebody who hasn't been operationally involved since twenty twenty comments at all and then calls out one of the biggest rivals saying the following about pinned wod Woe.

It is a surprise in and of itself that somebody who hasn't been operationally involved since twenty twenty comments at all and then calls out one of the biggest rivals saying the following about pinned wod Woe.

But here's the story as I see it.

But here's the story as I see it.

Bring up the chart and show the performance on the ADRs at least of pinned wod Woe, the owner of Timu versus Ali Barba, And the chart speaks for itself, right, Henry, just explain to the audience, Henry the battleground between Ali Baba and Timu owned by Pindroid well on the e commerce side.

Bring up the chart and show the performance on the ADRs at least of pinned wod Woe, the owner of Timu versus Ali Barba, And the chart speaks for itself, right, Henry, just explain to the audience, Henry the battleground between Ali Baba and Timu owned by Pindroid well on the e commerce side.

Yeah, definitely, Just as Isabelle said, this come and come from a very interesting point of time. On one hand, you have the incumbent Ali Baba, which is struggling to gain ground in domestic market. It has its strategy change, it recently canceled the plan to spin off and list its cloud unit, but at the same time it's going through management.

Yeah, definitely, Just as Isabelle said, this come and come from a very interesting point of time. On one hand, you have the incumbent Ali Baba, which is struggling to gain ground in domestic market. It has its strategy change, it recently canceled the plan to spin off and list its cloud unit, but at the same time it's going through management.

Reshuffle as well.

Reshuffle as well.

And at the other side you have the challenger TEAMU and its owner pindor Door. So at the domestic market, pin doo Doo is gaining share rapidly aggressively by cost cutting and price cutting as well. And at the overseas playground, Pindo Door is winning share by its Team U super app and it's planning uh to roll out another ads during this Super Bowl mid time show as well. So which shows that the Pindodo is really gaining ground in the US mark in the UK and the other side of the market as well. So you see that from the two spectrum. You see on one hand Ali Baba is waning, but on the other hand, Pindo or the PDD is definitely gaining ground rapidly.

And at the other side you have the challenger TEAMU and its owner pindor Door. So at the domestic market, pin doo Doo is gaining share rapidly aggressively by cost cutting and price cutting as well. And at the overseas playground, Pindo Door is winning share by its Team U super app and it's planning uh to roll out another ads during this Super Bowl mid time show as well. So which shows that the Pindodo is really gaining ground in the US mark in the UK and the other side of the market as well. So you see that from the two spectrum. You see on one hand Ali Baba is waning, but on the other hand, Pindo or the PDD is definitely gaining ground rapidly.

Henry, I like that you dig into the restructuring and on again, off again sort of versions of it. BlueBag Intelligence put out a piece saying, actually, this cool out by Jack Mars seems to reaffirm that indeed the restructuring is still going to be upon us.

Henry, I like that you dig into the restructuring and on again, off again sort of versions of it. BlueBag Intelligence put out a piece saying, actually, this cool out by Jack Mars seems to reaffirm that indeed the restructuring is still going to be upon us.

What does it end up looking like, Henry?

What does it end up looking like, Henry?

So remember Jack mauseeeded his control as CEO of Alibaba in twenty fourteen, and he barely entered the public appearance in the last two years due to the tech crackdown, and now he's re entering the public sphere. He's now commenting in the company's internal messaging board. There are lots of analysis about this, and mostly it's about it has been some time in this company's history that this company is run by some companies, some executives that doesn't have a close link with Jack Mal himself.

So remember Jack mauseeeded his control as CEO of Alibaba in twenty fourteen, and he barely entered the public appearance in the last two years due to the tech crackdown, and now he's re entering the public sphere. He's now commenting in the company's internal messaging board. There are lots of analysis about this, and mostly it's about it has been some time in this company's history that this company is run by some companies, some executives that doesn't have a close link with Jack Mal himself.

But now Jack Mal.

But now Jack Mal.

Re entering this public sphere might mean that Jack Mal might have more control of the company's strategy, more company's management as well.

Re entering this public sphere might mean that Jack Mal might have more control of the company's strategy, more company's management as well.

Just something that we will wait and see.

Just something that we will wait and see.

There was a time where Ali Baba was going to be China's trillion dollar market cap company. It was going to be China's equivalent of the Silicon Valley darlings, Apple, et cetera. And a lot has happened this year. You know, there has been leadership shuffles. Isabelle I think it's worth reminding everyone who actually runs Ali Barba as it stands.

There was a time where Ali Baba was going to be China's trillion dollar market cap company. It was going to be China's equivalent of the Silicon Valley darlings, Apple, et cetera. And a lot has happened this year. You know, there has been leadership shuffles. Isabelle I think it's worth reminding everyone who actually runs Ali Barba as it stands.

It's exactly right.

It's exactly right.

It's been a tough year for Ali Baba, a tough few years because Ali Baba's market cap is now around one ninety billion, and PDD has leap frog and it's now around one seventy billion, so that's not really a far cry anymore. And of course you still have ten cent leading. But the point is Ali Baba was going at a fast pace and now it's slowed, and I think, I don't want to put words into Jackma's mouth, of course, but shows that he's kind of really concerned about the direction of where Ali Baba is going, because it's one thing to slow, but another thing for all your arrivals to surpass you.

It's been a tough year for Ali Baba, a tough few years because Ali Baba's market cap is now around one ninety billion, and PDD has leap frog and it's now around one seventy billion, so that's not really a far cry anymore. And of course you still have ten cent leading. But the point is Ali Baba was going at a fast pace and now it's slowed, and I think, I don't want to put words into Jackma's mouth, of course, but shows that he's kind of really concerned about the direction of where Ali Baba is going, because it's one thing to slow, but another thing for all your arrivals to surpass you.

So I think that's really key right now.

So I think that's really key right now.

And you know, Ma even this month hit the brakes on his plan to reduce his stick on Alibaba because the South price was not at a level that he's happy with. For now, Ali Baba is just a fraction of what it was in twenty twenty and is trading at the lowest level this year.

And you know, Ma even this month hit the brakes on his plan to reduce his stick on Alibaba because the South price was not at a level that he's happy with. For now, Ali Baba is just a fraction of what it was in twenty twenty and is trading at the lowest level this year.

Ed Yeah, and it's in negi ary year today, while Pindodo's up triple digits year today. Bloomberg's Henry Wren and Isabella Lee great team coverage on an important China story. Meanwhile, sticking with China, China's five Whye capital and early backer go Me is on track to surpass its target of raising seven hundred million dollars for a closely watched venture fund.

Ed Yeah, and it's in negi ary year today, while Pindodo's up triple digits year today. Bloomberg's Henry Wren and Isabella Lee great team coverage on an important China story. Meanwhile, sticking with China, China's five Whye capital and early backer go Me is on track to surpass its target of raising seven hundred million dollars for a closely watched venture fund.

It's a sign that investors.

It's a sign that investors.

Are regaining confidence in the world's biggest Internet arena. The over subscribed US dollar fund has a hard cap of eight hundred million dollars and is sector close early next year. That's according to Bloomberg's sources CARC.

Are regaining confidence in the world's biggest Internet arena. The over subscribed US dollar fund has a hard cap of eight hundred million dollars and is sector close early next year. That's according to Bloomberg's sources CARC.

Now let's just move our attention towards the world of crypto for a moment. And because Finance is appointed a new CEO after it's four point three billion dollars settlement with the US Department of Justice that force the co founder CZ to step down. Now bloemgs Funsten like I sat down with Richard Tang earlier to discuss his vision for the company.

Now let's just move our attention towards the world of crypto for a moment. And because Finance is appointed a new CEO after it's four point three billion dollars settlement with the US Department of Justice that force the co founder CZ to step down. Now bloemgs Funsten like I sat down with Richard Tang earlier to discuss his vision for the company.

Is the new CEO.

Is the new CEO.

The US resolution with the US agencies are very important, right there are historical issues on compliance, registration and sanctions, and with the resolution, we move on to a new chapter, moving past a very challenging period of our corporate history. So going forward, we will continue to focus on things like user growth. On that front, I need to stress the user SX are back one to one. Users can withdraw one hundred percent of their SS at any point in time. We continue to force focus on user need. At the same time, we did make some mistakes along the way. We acknowledge those. It's important for us as a financial institution to do so, and we learn from the and we continue to build in the journey right on things like I think you're going to ask who as our working quarters. We'll make those disclosures and do class right as part of the resolution. There are certain things that we were put in place that we are complete to do so, including board of directors. But those announcements will be coming soon, so watch that space.

The US resolution with the US agencies are very important, right there are historical issues on compliance, registration and sanctions, and with the resolution, we move on to a new chapter, moving past a very challenging period of our corporate history. So going forward, we will continue to focus on things like user growth. On that front, I need to stress the user SX are back one to one. Users can withdraw one hundred percent of their SS at any point in time. We continue to force focus on user need. At the same time, we did make some mistakes along the way. We acknowledge those. It's important for us as a financial institution to do so, and we learn from the and we continue to build in the journey right on things like I think you're going to ask who as our working quarters. We'll make those disclosures and do class right as part of the resolution. There are certain things that we were put in place that we are complete to do so, including board of directors. But those announcements will be coming soon, so watch that space.

Yeah, but Richard, can you already just give us a sense of what people want? So if they want a more normal structure with headquarters that was problematic in the past because there was no one single place, how fast do you think that will be done?

Yeah, but Richard, can you already just give us a sense of what people want? So if they want a more normal structure with headquarters that was problematic in the past because there was no one single place, how fast do you think that will be done?

And then I'll also ask you.

And then I'll also ask you.

About the board of directors because I guess that's what people are asking for. It's like, what kind of framework will Binance have.

About the board of directors because I guess that's what people are asking for. It's like, what kind of framework will Binance have.

We com back to the past where the industry is ran naiscent. If you look at today, the direction of travel is very clear. There's going to be much more regulations for the crypto industry, even though only wanted of global regulators are regulating this space. But the direction of travel is very very clear.

We com back to the past where the industry is ran naiscent. If you look at today, the direction of travel is very clear. There's going to be much more regulations for the crypto industry, even though only wanted of global regulators are regulating this space. But the direction of travel is very very clear.

Right.

Right.

So along with that, along with the maturing of both industry as well as to copy it ourselves. All these things will be put in place. As I mentioned again, a bot of directors will be instituted. It's on very robuth timeline. Same for things like the questions did you asked? And we will make those annoscement coasts so you can disclose it at this point in.

So along with that, along with the maturing of both industry as well as to copy it ourselves. All these things will be put in place. As I mentioned again, a bot of directors will be instituted. It's on very robuth timeline. Same for things like the questions did you asked? And we will make those annoscement coasts so you can disclose it at this point in.

That it's today's big Take, and we're taking a look at an issue that's been rising along with AI generated content coming closer and closer to real images. We bring you exclusive reporting from Bluebog Business Week focusing on a group of deep fake pornography victims and how they actually banded together they fought back despite the absence of federal laws to protect them. Bloomberg's Olivia Carvill joins us now one of the key reporters on this, and it all goes back to New Year's Eve twenty twenty, when a text came through to one of these particular women in Long Island who've managed to now well find feel there were perhaps victims and fought back and the ending up sort of winning out here.

That it's today's big Take, and we're taking a look at an issue that's been rising along with AI generated content coming closer and closer to real images. We bring you exclusive reporting from Bluebog Business Week focusing on a group of deep fake pornography victims and how they actually banded together they fought back despite the absence of federal laws to protect them. Bloomberg's Olivia Carvill joins us now one of the key reporters on this, and it all goes back to New Year's Eve twenty twenty, when a text came through to one of these particular women in Long Island who've managed to now well find feel there were perhaps victims and fought back and the ending up sort of winning out here.

Yeah, that's right.

Yeah, that's right.

I mean, this is a story of female empowerment in this new era of generative AI that we all live in. This technology is both terrifying but also exciting, and I think we wanted with this story to highlight some of those potential harms and that's what led us to leave it Town.

I mean, this is a story of female empowerment in this new era of generative AI that we all live in. This technology is both terrifying but also exciting, and I think we wanted with this story to highlight some of those potential harms and that's what led us to leave it Town.

Long Island, Olivia.

Long Island, Olivia.

In allgad Big Takes, there is a case study or case studies and a narrative around the broader story. But what it highlights is a lack of legal protection, a deficit in the law.

In allgad Big Takes, there is a case study or case studies and a narrative around the broader story. But what it highlights is a lack of legal protection, a deficit in the law.

Just explain that side to us.

Just explain that side to us.

When you look across the country, there is just a patchwork of laws focusing on deep fakes at the moment. The story is really symbolic of the fact that there are no very strong laws to target deep fake content right now in the US, there is no federal law against creating fake pornographic con tent online and with this rise of generative AI, that puts us in a very scary place. So what we did for this story is we analyzed some of the statutes that have been put in place across the country and found this patchwork of civil cases. Some of the statutes are criminal, some only target election related content, and some are just amendments to revenge porn laws. What this means is that there is very little recourse for victims of deep fake pornography today.

When you look across the country, there is just a patchwork of laws focusing on deep fakes at the moment. The story is really symbolic of the fact that there are no very strong laws to target deep fake content right now in the US, there is no federal law against creating fake pornographic con tent online and with this rise of generative AI, that puts us in a very scary place. So what we did for this story is we analyzed some of the statutes that have been put in place across the country and found this patchwork of civil cases. Some of the statutes are criminal, some only target election related content, and some are just amendments to revenge porn laws. What this means is that there is very little recourse for victims of deep fake pornography today.

It's an extremely graphic Internet address which was where they found the content that was faked for seeing me of themselves young girls in school, and I'm interested as also. You also go to New Zealand for the story and a legal entanglement that's happening over there. Is this an issue in the US alone or is this a global issue of regulation trying to keep up with now generative AI pushing out what are incredibly realistic photos that aren't photos.

It's an extremely graphic Internet address which was where they found the content that was faked for seeing me of themselves young girls in school, and I'm interested as also. You also go to New Zealand for the story and a legal entanglement that's happening over there. Is this an issue in the US alone or is this a global issue of regulation trying to keep up with now generative AI pushing out what are incredibly realistic photos that aren't photos.

This is definitely a global issue. We're seeing cases across the country. As we were studying this particular website, we saw examples of deep fake pornography of women from countries all over the world.

This is definitely a global issue. We're seeing cases across the country. As we were studying this particular website, we saw examples of deep fake pornography of women from countries all over the world.

This isn't just a US problem.

This isn't just a US problem.

But this case in Levittown is the first real example of a deep fake related conviction where we could highlight in the story how prosecutors and the police really tried to file charges against the young man who was behind this content, but ultimately failed to do so because there are no laws to protect victims of deep fake pornography here. So I feel as though this story this narrative, and you're right, it crosses from Levittown all the way to New Zealand is symbolic of a much broader problem.

But this case in Levittown is the first real example of a deep fake related conviction where we could highlight in the story how prosecutors and the police really tried to file charges against the young man who was behind this content, but ultimately failed to do so because there are no laws to protect victims of deep fake pornography here. So I feel as though this story this narrative, and you're right, it crosses from Levittown all the way to New Zealand is symbolic of a much broader problem.

Bloomberg's Olivia carvill with the big take, terrific reporting, Thank you. Another big story coming out of Apple reportedly taking steps to pull the plug on a credit card partnership with Goldman the details. Next, this is Bloomberg Technology. Welcome back to Bloomberg Technology, Ed love O here in San Francisco.

Bloomberg's Olivia carvill with the big take, terrific reporting, Thank you. Another big story coming out of Apple reportedly taking steps to pull the plug on a credit card partnership with Goldman the details. Next, this is Bloomberg Technology. Welcome back to Bloomberg Technology, Ed love O here in San Francisco.

I'm Caroline hired in New York. Let's get a check in on these markets. But I'm looking at what's happening in the world of Golden Dragon and China Index.

I'm Caroline hired in New York. Let's get a check in on these markets. But I'm looking at what's happening in the world of Golden Dragon and China Index.

Then now's that Golden Dragon.

Then now's that Golden Dragon.

This is what, of course is the Chinese names traded here over the United States ADRs and actually under pressure after we saw mayit one's numbers showing a lack of resiliency. Was so worried about a Chinese consumer and Andy Dali Barber Jack mar coming back to speak out and say you need to take on PDD, which actually did incredibly well in its numbers. We're looking at what's happening in HPE as well. It came out with its numbers yesterday after the bell We're seeing a rebound up seven percent.

This is what, of course is the Chinese names traded here over the United States ADRs and actually under pressure after we saw mayit one's numbers showing a lack of resiliency. Was so worried about a Chinese consumer and Andy Dali Barber Jack mar coming back to speak out and say you need to take on PDD, which actually did incredibly well in its numbers. We're looking at what's happening in HPE as well. It came out with its numbers yesterday after the bell We're seeing a rebound up seven percent.

Why, well, it's not at server business, that's the sure.

Why, well, it's not at server business, that's the sure.

It's all about its resiliency in artificial intelligence that manages to buoy this stock. And I'm interested in the AI read across when it comes to Amazon as well. Ed we're looking at just off by about four tens percent on Amazon, but they had been doing well earlier on the day as we saw reinvent. Of course, that annual gathering of its customers really managing to paint a position of well combative and competitive nature that Amazon's coming at this when it comes with its chips, of course, that it is making and managing to make general to AI part of the corporate lexicon.

It's all about its resiliency in artificial intelligence that manages to buoy this stock. And I'm interested in the AI read across when it comes to Amazon as well. Ed we're looking at just off by about four tens percent on Amazon, but they had been doing well earlier on the day as we saw reinvent. Of course, that annual gathering of its customers really managing to paint a position of well combative and competitive nature that Amazon's coming at this when it comes with its chips, of course, that it is making and managing to make general to AI part of the corporate lexicon.

Two.

Two.

I think combative is correct. Competitive is what they'd say. Amazon Web Services did kick off its giant annual conference in Las Vegas yesterday, the new announcement updated versions of its in house Silicon and expansion of a partnership with Nvidia. I caught up with AWS CEO Adam Selipski, have a listen, well, I.

I think combative is correct. Competitive is what they'd say. Amazon Web Services did kick off its giant annual conference in Las Vegas yesterday, the new announcement updated versions of its in house Silicon and expansion of a partnership with Nvidia. I caught up with AWS CEO Adam Selipski, have a listen, well, I.

Think our strategy has been very consistent. It is to provide choice and powerful options at all layers of the stack. So down at the infrastructure layer of what you need to do generative AI really well. As you mentioned, we both have been investing in our own silicon and then we have had a long standing, wonderful relationship with Nvidia. We've been the first to bring pretty much every significant in Nvidia chip to the cloud, including their latest H one hundred this past summer, and I was really excited to have their CEO, Jensen Holong on stage with me this morning talking about an expansion of the partnership with AWS bringing their DJX cloud to AWS, and Nvidia itself is going to be standing up a huge supercomputer of a cloud for their own internal R and D on AWS. So it's a fantastic expansion of what's really a great relationship that benefits our mutual customers, Adam.

Think our strategy has been very consistent. It is to provide choice and powerful options at all layers of the stack. So down at the infrastructure layer of what you need to do generative AI really well. As you mentioned, we both have been investing in our own silicon and then we have had a long standing, wonderful relationship with Nvidia. We've been the first to bring pretty much every significant in Nvidia chip to the cloud, including their latest H one hundred this past summer, and I was really excited to have their CEO, Jensen Holong on stage with me this morning talking about an expansion of the partnership with AWS bringing their DJX cloud to AWS, and Nvidia itself is going to be standing up a huge supercomputer of a cloud for their own internal R and D on AWS. So it's a fantastic expansion of what's really a great relationship that benefits our mutual customers, Adam.

And they still supply constraints around in video GPUs.

And they still supply constraints around in video GPUs.

Well, they're very popular, and I think it is still remains true that there's probably more people who want to get their hands on them than actually can, which is one of the reasons why we also announced this concept of clusters BC two for chips and so that you can actually go down reserve up to hundreds of GPUs for your short term generative AI needs for things like training models, which can tend to apisotic, and there's really nobody else out there offering anything like that kind of service.

Well, they're very popular, and I think it is still remains true that there's probably more people who want to get their hands on them than actually can, which is one of the reasons why we also announced this concept of clusters BC two for chips and so that you can actually go down reserve up to hundreds of GPUs for your short term generative AI needs for things like training models, which can tend to apisotic, and there's really nobody else out there offering anything like that kind of service.

Given that's the case, if you had to shift any customers to Trainium because of the limited supply of in video GPUs, Yeah.

Given that's the case, if you had to shift any customers to Trainium because of the limited supply of in video GPUs, Yeah.

It's really not about shifting. It's really about customers need different Different customers need different things. The same customer needs different things for different use cases and awos for this over seventeen years we've been doing this has been all about choice, all about democratization, all about putting tools in the hands of our customers so that they can make the choices about what we need. And so we're also excited that we announced the second generation of our training specific chip for training gener VII workloads, and that is Trainium too, and that's going to have up to four times the compute performance of the first generation of Trainium. We of course, have been investing in our own custom silicon for years. We also today announce that we're shipping the preview of our fourth generation of general purpose chip, Graviton four. I happen to have one with me right here. This is a Graviton forward ship. We're not talking about it we're not showing slides on it. It's not future looking like a lot of other cloud providers. Yeah, it is shipping today and again our fourth generation, the power is incredible, the price performance is going to be incredibly attractive, and our chips also have incredible energy efficiency benefits, which is really really important to our customers these days.

It's really not about shifting. It's really about customers need different Different customers need different things. The same customer needs different things for different use cases and awos for this over seventeen years we've been doing this has been all about choice, all about democratization, all about putting tools in the hands of our customers so that they can make the choices about what we need. And so we're also excited that we announced the second generation of our training specific chip for training gener VII workloads, and that is Trainium too, and that's going to have up to four times the compute performance of the first generation of Trainium. We of course, have been investing in our own custom silicon for years. We also today announce that we're shipping the preview of our fourth generation of general purpose chip, Graviton four. I happen to have one with me right here. This is a Graviton forward ship. We're not talking about it we're not showing slides on it. It's not future looking like a lot of other cloud providers. Yeah, it is shipping today and again our fourth generation, the power is incredible, the price performance is going to be incredibly attractive, and our chips also have incredible energy efficiency benefits, which is really really important to our customers these days.

A bit of shade being thrown their carro We also finally got a chatbot from Amazon.

A bit of shade being thrown their carro We also finally got a chatbot from Amazon.

It's called Q. Any idea why it's called Q?

It's called Q. Any idea why it's called Q?

Please tell me it's something to do with the British Secret Service.

Please tell me it's something to do with the British Secret Service.

It is not. I did post that on X it is not. Q stands for question. Oh that's it. That was the rationale from the Star Trek's inside Amazon. That's it.

It is not. I did post that on X it is not. Q stands for question. Oh that's it. That was the rationale from the Star Trek's inside Amazon. That's it.

Oh, well, gotta love it. Chatbots taking over the world.

Oh, well, gotta love it. Chatbots taking over the world.

Meanwhile, well, let's talk about whether or not Apple's focus on fintech has been taking over the world or not, because it's actually taking steps towards running down as credit card deal with Goldman Sachs. So's to say, Apple recently sent a term sheet to well, perhaps a different institution which has been trying to ultimately see a pullback from a credit card business for Goldman Sacks. At the same time, let's get more contact on Blue Magnus Wall Street reporter Shanani Bassack.

Meanwhile, well, let's talk about whether or not Apple's focus on fintech has been taking over the world or not, because it's actually taking steps towards running down as credit card deal with Goldman Sachs. So's to say, Apple recently sent a term sheet to well, perhaps a different institution which has been trying to ultimately see a pullback from a credit card business for Goldman Sacks. At the same time, let's get more contact on Blue Magnus Wall Street reporter Shanani Bassack.

We mosto got Blue Magnuze chief.

We mosto got Blue Magnuze chief.

Correspondent Mark German, And Mark, let's start with you on the Apple Goldman relationship, because well, it hasn't been as positive as both would have liked.

Correspondent Mark German, And Mark, let's start with you on the Apple Goldman relationship, because well, it hasn't been as positive as both would have liked.

Feels like, Yeah, the Apple and Goldman Sax relationship has been rocky from the beginning the Apple cards development, everything that had to be done on both the Apple side and the Goldman side. Really it was a rocky development process. It was two companies getting into a new game together right for the first time. A lot of back end changes had to be created both at Apple and Golden Sacks. You had two companies run by people with big personalities, with ends with different backgrounds coming together to build.

Feels like, Yeah, the Apple and Goldman Sax relationship has been rocky from the beginning the Apple cards development, everything that had to be done on both the Apple side and the Goldman side. Really it was a rocky development process. It was two companies getting into a new game together right for the first time. A lot of back end changes had to be created both at Apple and Golden Sacks. You had two companies run by people with big personalities, with ends with different backgrounds coming together to build.

Something, right.

Something, right.

That's what a partnership is. But when you have two really intense companies, two intense groups of people, opinionated groups of people who believe they're doing it best, sometimes that could come to a head.

That's what a partnership is. But when you have two really intense companies, two intense groups of people, opinionated groups of people who believe they're doing it best, sometimes that could come to a head.

Right, And what you've.

Right, And what you've.

Seen is you've seen pretty good consumer reception to the Apple Card and the other fintech products from Apple over the past few years. But what you've also seen are some struggles Goldman in particular. This has been a multi hundred million dollar, if not multi billion dollar loss and proposition for Goldman Sacks, and so their skin in the game has been little more than a branding exercise. As we've written several times, and I'm sure a Shanali can talk about, Goldman has been pulling back from consumer businesses. They've pulled back on other credit cards and such, and Apple needs to sort of save face here. They need to have a strong partner in the credit card game. And being with a company that has been publicly one foot out the door, maybe one and a half feet out the door, maybe even two feet out the door, you know, that really doesn't serve Apple well long term. So with done is they sent a proposal to Goldman Sacks to get out of this partnership. This is being able to get out in about two three years from now versus when the deal's supposed to end in twenty twenty nine. So I don't know if that means Goldman has to make some sort of public acknowledgement about exiting. I don't know if Goldman has to pay a certain amount. I don't know if Apple has to reduce its payments to Goldman, but they've sent a proposal to Goldman to let Goldman walk about five years early from this partnership, while Apple can go ahead and look for someone else to replace them.

Seen is you've seen pretty good consumer reception to the Apple Card and the other fintech products from Apple over the past few years. But what you've also seen are some struggles Goldman in particular. This has been a multi hundred million dollar, if not multi billion dollar loss and proposition for Goldman Sacks, and so their skin in the game has been little more than a branding exercise. As we've written several times, and I'm sure a Shanali can talk about, Goldman has been pulling back from consumer businesses. They've pulled back on other credit cards and such, and Apple needs to sort of save face here. They need to have a strong partner in the credit card game. And being with a company that has been publicly one foot out the door, maybe one and a half feet out the door, maybe even two feet out the door, you know, that really doesn't serve Apple well long term. So with done is they sent a proposal to Goldman Sacks to get out of this partnership. This is being able to get out in about two three years from now versus when the deal's supposed to end in twenty twenty nine. So I don't know if that means Goldman has to make some sort of public acknowledgement about exiting. I don't know if Goldman has to pay a certain amount. I don't know if Apple has to reduce its payments to Goldman, but they've sent a proposal to Goldman to let Goldman walk about five years early from this partnership, while Apple can go ahead and look for someone else to replace them.

Snarali.

Snarali.

We can get into Apple's position long term on a car because it looks like the Apple side of the cart.

We can get into Apple's position long term on a car because it looks like the Apple side of the cart.

Ain't going anywhere.

Ain't going anywhere.

But there's been an emission from Goldman that they just moved too quickly, too early, They made mistakes with the product. Some of the data around the deposits is really good. Where are they coming at this from from Goldman Sachs side.

But there's been an emission from Goldman that they just moved too quickly, too early, They made mistakes with the product. Some of the data around the deposits is really good. Where are they coming at this from from Goldman Sachs side.

Yeah, you have to look at it across product lines, because I think that's an important part here. On one hand, Goldman likes to pull in deposits those market markets. Deposit rates are still quite high and for a bank, that extra consumer deposit base helps lower the cost of funding for a bank. But the credit card business here, where they had struck deals with GM major clients Apple, you have them starting to step back from that business and it is really kind of the last major piece of the consumer strategy that they're trying to exit from. So what have they already gotten out of they have looked to sell Green Sky already United Capital. These are things that have brought them deeper into the wealth business. They had scrapped that idea of larger sets of accounts for different clients as well. But the green Sky was the home installment loan business, of course, So where does that leave them. It leaves them with all these card deals and Apple is you know this, by the way, for Goldman could have been a problem that could have lasted them years. And when it comes to the Apple card in particular, one major problem ed it was the servicing of these clients as well as the loss rates, because the idea here that Apple wanted more of their clients to be able to get credit through these cards, and so they pushed for that to happen. And now you had Goldman stuck with those loss rates, really bringing down the profit of the business overall. Now, according to the Wall Street Journal, some of the potential people that could take on these this card business alongside Apple could include American Express, could include Synchrony. But some of the issues I've outlined for you over there at Goldman would still hold true for them as well.

Yeah, you have to look at it across product lines, because I think that's an important part here. On one hand, Goldman likes to pull in deposits those market markets. Deposit rates are still quite high and for a bank, that extra consumer deposit base helps lower the cost of funding for a bank. But the credit card business here, where they had struck deals with GM major clients Apple, you have them starting to step back from that business and it is really kind of the last major piece of the consumer strategy that they're trying to exit from. So what have they already gotten out of they have looked to sell Green Sky already United Capital. These are things that have brought them deeper into the wealth business. They had scrapped that idea of larger sets of accounts for different clients as well. But the green Sky was the home installment loan business, of course, So where does that leave them. It leaves them with all these card deals and Apple is you know this, by the way, for Goldman could have been a problem that could have lasted them years. And when it comes to the Apple card in particular, one major problem ed it was the servicing of these clients as well as the loss rates, because the idea here that Apple wanted more of their clients to be able to get credit through these cards, and so they pushed for that to happen. And now you had Goldman stuck with those loss rates, really bringing down the profit of the business overall. Now, according to the Wall Street Journal, some of the potential people that could take on these this card business alongside Apple could include American Express, could include Synchrony. But some of the issues I've outlined for you over there at Goldman would still hold true for them as well.

All right, Bloombos Mark German and Shanalie Bassett. We did show Apple's comment on the story. There they seem committed Caro to a card in the first instance and long term.

All right, Bloombos Mark German and Shanalie Bassett. We did show Apple's comment on the story. There they seem committed Caro to a card in the first instance and long term.

Well from fintech to where you'd be spending your money. And perhaps it's not the movies to go and see. Wish it would seem because Disney's newest.

Well from fintech to where you'd be spending your money. And perhaps it's not the movies to go and see. Wish it would seem because Disney's newest.

Auni Maintor musical is being marked as a box office dud, delivering just half.

Auni Maintor musical is being marked as a box office dud, delivering just half.

Of its expected ticket sales over the Thanksgiving weekend. Now, Disney Studio executives, they've got to assess or went wrong, Like it's been a year where we've seen strong female leads win big in the box office, Think Barbie, think Taylor Swift. But wish it's flopping And maybe it's the son of the times. Maybe these classic fairy tale princess stories aren't as appealing as they were once or as the mother of a daughter who's obsessed with princesses for my sins, maybe it's bit scary.

Of its expected ticket sales over the Thanksgiving weekend. Now, Disney Studio executives, they've got to assess or went wrong, Like it's been a year where we've seen strong female leads win big in the box office, Think Barbie, think Taylor Swift. But wish it's flopping And maybe it's the son of the times. Maybe these classic fairy tale princess stories aren't as appealing as they were once or as the mother of a daughter who's obsessed with princesses for my sins, maybe it's bit scary.

I don't know, but for now it's a flop.

I don't know, but for now it's a flop.

Coming up, we'll take the pulse of the European VC and tech industry. OX co founder Michael Johnson's joining us on a big raise in the second fund.

Coming up, we'll take the pulse of the European VC and tech industry. OX co founder Michael Johnson's joining us on a big raise in the second fund.

Stability AI has explored selling the company, with management facing increased pressure from investors over its financial position. That all, according to Bloomberg's sources, a deal is not imminent and the company could of course cut the process short without selling. Let's bring in Bloomberg's Rachel Metz, who broke this one. We've been chasing what's going on inside Stability for a little while. Looks like there's a for sale sign in the digital window and IMAD is under pressure.

Stability AI has explored selling the company, with management facing increased pressure from investors over its financial position. That all, according to Bloomberg's sources, a deal is not imminent and the company could of course cut the process short without selling. Let's bring in Bloomberg's Rachel Metz, who broke this one. We've been chasing what's going on inside Stability for a little while. Looks like there's a for sale sign in the digital window and IMAD is under pressure.

What have you learned?

What have you learned?

Yeah, so we.

Yeah, so we.

Have learned that one of the company's key investors, CO two, sent a letter to the company in October asking pressure pressure you had to step down, asking questions about the company's financial status, how much certain people were being paid, things like that. And there's also been this is putting pressure on the company to see if it can find a buyer for itself. It at this point doesn't have a ton of cash, so it's been reaching out to a few companies. We've learned it's reached out to cohere Jasper. Those are two of the companies that we know for sure that it's been reaching out to. But those companies, as far as we know are not interested.

Have learned that one of the company's key investors, CO two, sent a letter to the company in October asking pressure pressure you had to step down, asking questions about the company's financial status, how much certain people were being paid, things like that. And there's also been this is putting pressure on the company to see if it can find a buyer for itself. It at this point doesn't have a ton of cash, so it's been reaching out to a few companies. We've learned it's reached out to cohere Jasper. Those are two of the companies that we know for sure that it's been reaching out to. But those companies, as far as we know are not interested.

Meanwhile, spose people for the company's stability fight back and say no, it's not not for sale, and actually investors believe in leadership.

Meanwhile, spose people for the company's stability fight back and say no, it's not not for sale, and actually investors believe in leadership.

Do you buy that?

Do you buy that?

I mean, I think these things are always complicated and it it it could be sort of both ways at once. Right, they have plenty of investors, uh, but it is certainly clear that some of its key investors are not happy with the direction that the company has been going in.

I mean, I think these things are always complicated and it it it could be sort of both ways at once. Right, they have plenty of investors, uh, but it is certainly clear that some of its key investors are not happy with the direction that the company has been going in.

For sure, Mets as always brilliant reporting. We thank you for keeping us up to date with perhaps what's thought of.

For sure, Mets as always brilliant reporting. We thank you for keeping us up to date with perhaps what's thought of.

Is AI hype.

Is AI hype.

We're going to move away from that for a moment because one firm is going anti hype, but it's continuing to double down investments in the SaaS space. Ox just announce the close of their second fund with one hundred ninety million dollars to grow European software startups. US co founder and general partner Michael Johnson is joining us now. And you have a focus on European software as a service, but can that still be AI leveraged, generative AI applied.

We're going to move away from that for a moment because one firm is going anti hype, but it's continuing to double down investments in the SaaS space. Ox just announce the close of their second fund with one hundred ninety million dollars to grow European software startups. US co founder and general partner Michael Johnson is joining us now. And you have a focus on European software as a service, but can that still be AI leveraged, generative AI applied.

If you're saying you're anti hype at this.

If you're saying you're anti hype at this.

Moment, A good afternoon, Caroline, Yes, very much. So I mean, we are not specifically looking to make AI investments as a sector bed per se, but we do think that AI is providing a foundational new wave of innovation that will underpin all of software, you know, for the next ten to twenty years.

Moment, A good afternoon, Caroline, Yes, very much. So I mean, we are not specifically looking to make AI investments as a sector bed per se, but we do think that AI is providing a foundational new wave of innovation that will underpin all of software, you know, for the next ten to twenty years.

So very much so, yes, okay, I've been excited to have you on the show.

So very much so, yes, okay, I've been excited to have you on the show.

I think it's like a good time to define again what is SaaS right, Software as a service. To most people, it just means a piece of software or an app you can use over the Internet, and in many cases that ain't complicated. So is that your definition in terms of what you're looking for in a portfolio company.

I think it's like a good time to define again what is SaaS right, Software as a service. To most people, it just means a piece of software or an app you can use over the Internet, and in many cases that ain't complicated. So is that your definition in terms of what you're looking for in a portfolio company.

I think there's a couple of things to think about. There's the underlying infrastructure, and then there's the business model. So the infrastructure usually that is associated with SaaS is cloud infrastructure, so you have elastic scalability and you have multi tenant hosting. Now, SaaS as a business model can actually work on a lot of different situations as well, and it could be a piece of software that it's in a data center, or it could be a shared service, or it could be a true multi tenant cloud service. I think what is also important for SAS is that what used to be SaaS was a traditional subscription for a monthly or an annual fee. We're seeing way more sophisticated pricing models, which are you the capacity based or value based and what have you. So it's evolving continuously, but at the core of it, it's about buying software on a subscription basis rather than buying a perpetual license.

I think there's a couple of things to think about. There's the underlying infrastructure, and then there's the business model. So the infrastructure usually that is associated with SaaS is cloud infrastructure, so you have elastic scalability and you have multi tenant hosting. Now, SaaS as a business model can actually work on a lot of different situations as well, and it could be a piece of software that it's in a data center, or it could be a shared service, or it could be a true multi tenant cloud service. I think what is also important for SAS is that what used to be SaaS was a traditional subscription for a monthly or an annual fee. We're seeing way more sophisticated pricing models, which are you the capacity based or value based and what have you. So it's evolving continuously, but at the core of it, it's about buying software on a subscription basis rather than buying a perpetual license.

You brought back some key LPs British patient Capital, some investor example, you brought on some new what is it that they like about European VC investing At the moment.

You brought back some key LPs British patient Capital, some investor example, you brought on some new what is it that they like about European VC investing At the moment.

We're obviously really happy to raise the fund despite these very challenging backdrop macroeconomically for a venture as an acid class and for you know, venture back growth companies in general. I think our model is focused on long term creation and avoiding hype cycles, and that has resonated really well with both returning and new investors, specifically as it relates to Europe and you know, investing into software in Europe. There's you know, a sort of coming of age where a lot of people are recognizing that the factors that have historically favored perhaps much more US companies are you know, not as important today when it comes to the availability of talent, when it comes to the availability of actually dealing with distribution, and in terms of how to thinking about scaling commercially, even if you start out in Europe with an ambition to have a globally leading company.

We're obviously really happy to raise the fund despite these very challenging backdrop macroeconomically for a venture as an acid class and for you know, venture back growth companies in general. I think our model is focused on long term creation and avoiding hype cycles, and that has resonated really well with both returning and new investors, specifically as it relates to Europe and you know, investing into software in Europe. There's you know, a sort of coming of age where a lot of people are recognizing that the factors that have historically favored perhaps much more US companies are you know, not as important today when it comes to the availability of talent, when it comes to the availability of actually dealing with distribution, and in terms of how to thinking about scaling commercially, even if you start out in Europe with an ambition to have a globally leading company.

OX co founder general partner Michaelson, thank you so much for joining us on the.

OX co founder general partner Michaelson, thank you so much for joining us on the.

Show here on Bloomberg Technology.

Show here on Bloomberg Technology.

The great thing about this technology, which it's hard to believe is just going on to the year anniversary, it seems like it's been here much longer and the pace has been incredible, is the fact that you can actually put it in the hands of business people.

The great thing about this technology, which it's hard to believe is just going on to the year anniversary, it seems like it's been here much longer and the pace has been incredible, is the fact that you can actually put it in the hands of business people.

And I think that.

And I think that.

Above all else has really unlocked the ability for people to really like imagine how this can be used in their businesses.

Above all else has really unlocked the ability for people to really like imagine how this can be used in their businesses.

A little bit earlier, as I say, with Jp Morgan, chief Data and Analytics Officer, trees at Heights and Weather, and we want to discuss a little bit more about how AI is actually bringing in money, boosting revenue being commercially viable at the moment within not just finance, but across the board. Nicolo de Massi is Chairman of the Futureom Group and you sit on a number of boards you were once named Aspat King will delve into that in a moment, but I'm interested at the moment with ion Q, for example, quantum computing company, how are you seeing the commercialization opportunities of generative AI within the companies that you help well oversee?

A little bit earlier, as I say, with Jp Morgan, chief Data and Analytics Officer, trees at Heights and Weather, and we want to discuss a little bit more about how AI is actually bringing in money, boosting revenue being commercially viable at the moment within not just finance, but across the board. Nicolo de Massi is Chairman of the Futureom Group and you sit on a number of boards you were once named Aspat King will delve into that in a moment, but I'm interested at the moment with ion Q, for example, quantum computing company, how are you seeing the commercialization opportunities of generative AI within the companies that you help well oversee?

Yeah, I mean, look, it's coming faster and it's closer than everyone thought. When you're talking about quantum machine learning and quantum computing intersecting with artificial intelligence and machine vision, you know you're seeing it across frankly, every sector, right from drug discovery to making next generation batteries, to the.

Yeah, I mean, look, it's coming faster and it's closer than everyone thought. When you're talking about quantum machine learning and quantum computing intersecting with artificial intelligence and machine vision, you know you're seeing it across frankly, every sector, right from drug discovery to making next generation batteries, to the.

Gaming industry to even businesses like.

Gaming industry to even businesses like.

The future from group that are taking advantage of a across their own market research and advisory.

The future from group that are taking advantage of a across their own market research and advisory.

I think quantum.

I think quantum.

Advantage is going to happen sooner than people think, and it's going to surprise a lot of people. I think you're going to see quantum supremacy also come earlier than people think in a number of application areas in the next few years. And I've been excited to watch the breadth of my portfolio have an early lead in their respective segments. Right I'm quite proud of the fact that we invested early on every board I'm on every company I'm involved with, and they really are leaders in the respective areas, increasingly partnering with cloud players Amazon, Microsoft, Google, hyperscalers and a lot of what I see a lot of is the strong partnering with the strong, right, whether that's in video with Amazon, im Q with Amazon, Microsoft, Google, and I feel like the strongest companies in AI are actually entrenching their leads right now.

Advantage is going to happen sooner than people think, and it's going to surprise a lot of people. I think you're going to see quantum supremacy also come earlier than people think in a number of application areas in the next few years. And I've been excited to watch the breadth of my portfolio have an early lead in their respective segments. Right I'm quite proud of the fact that we invested early on every board I'm on every company I'm involved with, and they really are leaders in the respective areas, increasingly partnering with cloud players Amazon, Microsoft, Google, hyperscalers and a lot of what I see a lot of is the strong partnering with the strong, right, whether that's in video with Amazon, im Q with Amazon, Microsoft, Google, and I feel like the strongest companies in AI are actually entrenching their leads right now.

Hey, Nikola, real quick though, lots of emphasis on the top line revenue, right, people making money, But the and learned has been the compute costs astronomical. How worried are you about sort of long term anyone actually making any profit from all of the R and D and the training and inference they're now doing well.

Hey, Nikola, real quick though, lots of emphasis on the top line revenue, right, people making money, But the and learned has been the compute costs astronomical. How worried are you about sort of long term anyone actually making any profit from all of the R and D and the training and inference they're now doing well.

Quantum computing is actually a solution to that, right in terms of energy usage per let's call it calculation or Colock tap.

Quantum computing is actually a solution to that, right in terms of energy usage per let's call it calculation or Colock tap.

Right.

Right.

If you look at imq's quantic computers, they're tiny, they don't use a lot of power compared to something that you know in National Lab.

If you look at imq's quantic computers, they're tiny, they don't use a lot of power compared to something that you know in National Lab.

Is running, right, And so I'm actually quite bullish.

Is running, right, And so I'm actually quite bullish.

That by twenty thirty, quantum AI through the cloud is going to change people's perspective on that question you just asked.

That by twenty thirty, quantum AI through the cloud is going to change people's perspective on that question you just asked.

But at the moment you're correct.

But at the moment you're correct.

There is a race on that no industry and no company can afford to lose. Right if you're a financial services firm, your trading arm is not going to make any money if you don't have the latest quantum computer and the latest AI helping your team. Same in drug discovery, same in defense and aerospace, same in cryptograph and so I think people right now, you know, have no choice, and that means the vendor supplier relationships, the kinds of companies the future and groups always advising are really front and center right now having to think through where they put their dollars to.

There is a race on that no industry and no company can afford to lose. Right if you're a financial services firm, your trading arm is not going to make any money if you don't have the latest quantum computer and the latest AI helping your team. Same in drug discovery, same in defense and aerospace, same in cryptograph and so I think people right now, you know, have no choice, and that means the vendor supplier relationships, the kinds of companies the future and groups always advising are really front and center right now having to think through where they put their dollars to.

Make sure they max it out, you know, quarter and quarter out.

Make sure they max it out, you know, quarter and quarter out.

Sure, but very sweet.

Sure, but very sweet.

We thank you for your time, Nicolo de Massi, chairman of the Future Room Group. All things focused still on AI, of course, and that does it for this addition of Bloombo Technology ed.