April 30, 2024 • 42 mins
Bloomberg's Caroline Hyde and Ed Ludlow take a look at Paramount replacing its CEO as M&A buzz overshadows mixed results. Plus: Amazon, AMD and Pinterest all report after the bell, and Binance's former CEO heads to court as prosecutors seek three years of prison time.
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Speaker 1 (00:02):
Bloomberg Audio Studios, podcasts, radio news.
Speaker 2 (00:07):
From Mahart where Innovation, money and power Collie in Silicon Valley, NBN.
Speaker 3 (00:13):
This is Bloomberg Technology with Caroline Hyde and Ed loved Love.
Speaker 4 (00:31):
I'm Caroline Hein and Bloomberg's World headquarters in New York
and I'm Ed Ludlow in San Francisco.
Speaker 5 (00:35):
This is Bloomberg Technology.
Speaker 4 (00:37):
Coming up paramount for places at CEO as M and
a buzz over shadows results.
Speaker 6 (00:42):
Full coverage ahead, plus.
Speaker 7 (00:44):
We push ahead to result from Amazon, AMD and Pinterest,
all reporting after the belt.
Speaker 6 (00:49):
And former finance CEO at CZ heads.
Speaker 4 (00:52):
To court as prosecutors seek three years in prison. Will
bring you the latest headlines as they cross, but first
a check in on these markets and look, the macro
picture not looking so pretty today and it forces stocks lower.
You get well the cost of labor at the moment,
the ECI number coming in higher than expected, and well
overall confidence from a consumer plunging.
Speaker 6 (01:11):
That means we're not looking so pretty.
Speaker 4 (01:13):
Heading into a Federal Reserve meeting that of course ends tomorrow,
and we hear from Jaypower off by four ten percent
on the NASDAK tenure yield pushing higher of course, where
boring costs rise, So stock's full.
Speaker 6 (01:22):
We're at four point sixty six, that's what usually the
trend is.
Speaker 4 (01:25):
We're seeing dollar stronger versus the Japanese end today, a
completely flip reverse from yesterday. Looks as though Japan did
indeed have some intervention into the markets to try and
prop up the yen. For now it's weaker against the
US dollar. Let's move on to have a look at
what's also we could get versus the US dollar. Bitcoin
along with other risk asset said on the downside, rob
by two point percent, sixty one thousand. This is wrapping
(01:46):
up to be a pretty poor month of April, the worst.
Speaker 6 (01:48):
Since, of course the FTX scandal.
Speaker 4 (01:51):
Down somewhat sixteen percent over the course of April for bitcoin,
and indeed we're seeing a pretty.
Speaker 6 (01:55):
Poor month for stocks.
Speaker 4 (01:56):
More overall, Nasdaq I think having its worst months since October.
Speaker 6 (02:00):
What do you think of the micro today?
Speaker 5 (02:02):
Okay, so there's a lot going on real quick.
Speaker 7 (02:03):
Tesla is down more than four percent, the information reporting
the entire supercharger team is gone. But remember twenty four
hours ago in Monday session, fifteen percent gain, biggest jump
since March of twenty twenty one on FSD tentative approval
on China. We'll dig into that later. Then there's earnings
AMD after the Bell. We know the story how well,
(02:24):
but above or below is the mi I three hundred
x done relative to expectations. Then you've got Amazon after
Alphabet and Microsoft Cloud growth driven by AI. We know
those stories and were look ahead to that later in
the program. Our top story is Paramount Global, so CEO
Bob Bakish is gone, replaced by basically a committee of executives.
(02:44):
They release earnings. No one seems to care. The question
is about M and A in the future. The stockdown
three point three percent. Let's go right to Bloomberg Intelligence
and this guita rangon Nathan to try and understand what's
going on. I love the kind of headline of your
research overnight, basically earnings and non.
Speaker 5 (02:59):
Av I on M and A.
Speaker 7 (03:01):
But just summarize what last night was like for you
and what you learned.
Speaker 3 (03:05):
Yes, yeah, the earnings call ed was was kind of
really bizarre. I mean it was, you know, a seven
to eight minute call, basically one of the shortest I've
ever seen in the history of media earnings. There were
no questions from the analyst or the investment community, and
it was just basically the CFO outlining the details of
the quarter, and you know, the three person committee kind
(03:26):
of giving their little spiel. But I think yes, there
were some encouraging elements from the first quarter results, but
of course M and A is stop and center overall.
I think that the key takeaway is that this is
peak uncertainty right now at Paramount. We really don't know
what's happening with ownership. We don't know what's happening with
leadership other than there is this committee. But obviously it's
(03:49):
a stop gap arrangement and there's no clue in terms
of what the future direction or the strategy is.
Speaker 4 (03:55):
Have you ever experienced this, Ketha, this lack of clarity
coming from leadership, coming from the company itself.
Speaker 3 (04:02):
Yeah, I mean this is kind of one of a
kind situation, Caroline. I mean, obviously, Sherry Redstone here is
desperately trying to get a deal done with sky Dance,
which is why she had to get rid of Barb Bakish,
who was opposing the deal pretty vocally from the get go.
Speaker 6 (04:21):
You know, there is a looming deadline.
Speaker 3 (04:23):
May third is the day which is Friday is the
day when the period of exclusive negotiations ends, and so
they're trying to do everything in their power to get
to that finish line as quickly as possible.
Speaker 4 (04:34):
Well, we dig into what is a very evolving story,
but ultimately with some decent streaming numbers come from Paramount,
we want to dig into all of that. First, we
thanks Bloomberg Intelligence ANALYSTKEITHA. Rangnath, and let's continue the conversation
with an expert in the field of media and ultimately
what on earth this landscape is like to try to
evolve Paramount. Going forward John Clines with US co founder
(04:54):
SEO of the sports streaming platform Handed Media. We'll also
form a president of CNN executive VP of CBS New Boyd.
Do you understand the internal workings of these sorts of
companies And I put it to you again, I mean,
there's a corporate governance issue going on at the moment.
But what should Paramount try you to be doing in
terms of its fundamentals right now?
Speaker 2 (05:13):
Well, you know I have experienced this before because I
was the media advisor to the show Succession, and I
have to tell you if you know so.
Speaker 1 (05:22):
Mayhem was our middle name. But if they'd come.
Speaker 2 (05:25):
To me with a plot twist that said they were
going to dump the CEO two hours before earnings, I
would have thrown it right back in their faces. I
would have said, no way anyway. You know, look, every
acquirer feels they can either grow an asset, or squeeze
additional profit out of the distressed parts, or just sell
(05:45):
off the parts. I wouldn't be surprised if David Ellison
feels that he lands in the growth camp. You know,
he's young, he's energetic, he has excellent taste. I love
some of the movies that he's produced, and he's got
Jeff Shell as a partner in Jeff is a really
savvy operator, you know, as he was when he was
CEO of NBC Universal. I think that the challenge for
(06:08):
any traditional media company in a landscape that is dominated
by the tech giants, right Apple, Amazon, Google. You know,
YouTube alone accounts for ten percent of the of the
TV viewing now on televisions, not not on devices. The
(06:30):
tech giants are dominating the media landscape, and so whoever
ends up owning Paramount has to think hard about that.
They have to think about streaming as a strategy you know,
because what streaming does is on the line.
Speaker 7 (06:48):
Let me just jump in real quick, John, because I
get that that they're technology companies. They're good at technology.
Caroline and I were discussing before the show. I quite
like Paramount. I like the streaming platform. I watch all
my Champions League football on Paramount Plus. I liked Taylo
it was pretty good. I like some of the Paramount movies.
Top Gun as an example of the Transformers movies. Who
(07:09):
doesn't what's missing, then what's the fix?
Speaker 1 (07:13):
I'll tell you what's missing.
Speaker 2 (07:14):
AI AI is what's driving streaming because it powers all
those deep audience insights that allow you to make smarter
programming decisions, more precision targeted marketing decisions. On my streaming
platform has seen our cost of acquiring a customer drop
from thirty four dollars to two dollars in one year's
time thanks to precision targeting AI. And David Ellison knows
(07:38):
somebody who is pretty good at the aipiece of it,
and that's his dad. And his dad is one of
the investor. Or Oracle is going to be among the
investors in this. And if you add Oracle AI power
to some of the assets that paramount owns you inch
closer anyway toward the giants.
Speaker 1 (08:00):
You're not a giant yet.
Speaker 2 (08:01):
Their market cap, I think is three hundred and fifty
times smaller than the big boys, but you're heading in
the right direction and that would be a smart thing
for them to do.
Speaker 4 (08:11):
So for you, this is a tech growth perspective coming
from Skydance Media. A lot of investors, though, have completely
seen an erosion in the value of their non voting stock.
They're frustrated that this isn't going to be some more
open bidding competition going on. John, is there a better,
more clear way of doing this to try? And we'll
hear clarity from Skydance and then see what others say.
(08:33):
The reports of an Apollo and a Sony could add themselves.
Speaker 2 (08:37):
Yeah, I mean, Skydance, you know, needs to play its
cards close to the vest in the short run. And
of course, if they end up winning the prize versus
Apollo slash Sony, you know, then they've got to lay
out a strategy and you know that's what the street
is going to be looking for work. And you know,
AI can't be ignored and you know, should obviously be
(09:01):
a central part of things. But look, family controlled or
single entity controlled companies invariably lead.
Speaker 1 (09:10):
To this kind of messiness.
Speaker 2 (09:13):
And if whoever ends up with it, at least you
would hope that things will the operation will run more cleanly.
Speaker 7 (09:20):
Moving forward, John, Of all the subscriptions you can have,
where does powamount rank?
Speaker 2 (09:28):
Look, I'm not alone in saying I churn constantly. Did
you know that only seven percent of people will tell
you that they plan to stick with the streaming platform
that they currently subscribe to. This month, ninety three percent
of viewers intend to leave. And that's because people watch
shows and stars, they don't watch platforms. That's equally applicable
(09:53):
to Netflix and Disney Plus and all of them. And
so you know, you've got to think in terms of
franchises that are driving the bus for a business. So,
you know, for paramount, the first one that jumps into
my mind.
Speaker 1 (10:08):
Is the NFL.
Speaker 2 (10:09):
I mean, the NFL dominates viewership on whatever platform at Arizona,
whether it's streaming on Amazon Prime or it's the traditional
broadcast networks.
Speaker 1 (10:17):
You know, they news.
Speaker 2 (10:19):
Streaming services are also drivers of streaming, and CBS just
rebranded their entire CBS News Streaming entity into CBS News
twenty four to seven, and so they've got to be
thinking streaming first, direct to consumer first, AI.
Speaker 5 (10:34):
Right, and the masters as well.
Speaker 7 (10:35):
Good example, if you're going to get one chunk off
or divest a bit, what would it be.
Speaker 2 (10:41):
The cable channels just you know, they're they're they're kind
of hopeless.
Speaker 1 (10:47):
I mean, they've lost their luster.
Speaker 2 (10:49):
I think you know, they tend to just play the
same show fifty thousand times in a row and a block,
which I like as a consumer. I can put the
Office on on other channels, you know, and all that.
But it's a dwindling asset. Everyone knows that. It's not
a surprise. I think they had some offers for some
of the cable channels in the past year. Part of
the friction between Redstone and Backish was that he didn't
(11:12):
sell some of.
Speaker 1 (11:13):
Them fast enough or at all. But that's where you'd
have to look.
Speaker 6 (11:18):
John.
Speaker 4 (11:18):
I'm just going to go bigger here because it's so
interesting what you bring about the technology story that needs
to be injected into Powermount. Of course, you were at
berninks AI, which was sold to Apple. You've got a
big focus on the AI compartment, but do you think
were broadly this is going to be happening elsewhere in
the industry. Paramount is a but one where we think
m and A or rejuvenation is needed within some of
(11:40):
these legacy businesses.
Speaker 2 (11:41):
Oh yeah, I mean, look, the market cap gap is
just enormous.
Speaker 1 (11:46):
I mean, the tech.
Speaker 2 (11:47):
Giants are three hundred and fifty times bigger than even
the you know, the biggest, most well known traditional media companies,
Warner Brothers, Discovery, you know, Netflix, even I think we
have to start thinking of as a traditional media company
because the only thing they do is entertainment programming and
now they're introducing sports, but they have no tech component.
(12:08):
They have no theme parks, you know, to mitigate risk
or anything. So they're a pure playing media company. I
think there's bound to be consolidation amidst those and if
Paramount is smart about pursuing the AI and streaming opportunities,
they become a more attractive merger or acquisition target as
those smaller players, the smaller planets come.
Speaker 7 (12:30):
Together joining Bloomberg Technology, a show available live and on
demand on lots of platforms. Looking around for a long time.
Hang Media co founder and CEO John Klin. Great to
have your perspective. Thank you, know, coming up, we're going
to take a look at the intensifying tech war between
the US and China. Just days after Elon Musk reached
that big milestone on FSD. That conversation coming up, this
(12:52):
is Bloomberg technology. The law requiring TikTok to divest or
be banned could be a pivotal moment in what is
(13:13):
an escalating rivalry between the US and China in the
context of technology. TikTok for the US would almost certainly
head to the Supreme Court, which would have to weigh
the government's security concerns against the free speech of the company.
And it's all but certain that China will retaliate against
the US. And that is according to those that watch
(13:33):
China's government in its responses closely. There's a lot to
discuss right now in the relationship between China and US
in the context of tech.
Speaker 5 (13:39):
And to do that we bring in Jen Haglee.
Speaker 7 (13:41):
The CEO and founder and head of researcher JL Warren Capital.
Let's just start with the TikTok case study. You know,
byte Dance is the world's most valuable startup, a Chinese giant,
but private, and it's said we have no plan to
sell divest TikTok in the States, but it's somewhere that
the States is just not going to accept your view
(14:03):
on that outcome.
Speaker 8 (14:05):
Well, I think it's inevitable that the two entities US
operation will be separated from the parent because consumer data
in US are just way too way too rich in
content and the way too sensitive for the same poken.
Speaker 1 (14:20):
I mean, I just think the.
Speaker 8 (14:21):
Reason announcement of Testda Bayd is a very case specific situation.
It's not applicable to sort of the broad de escalating
tension between the US and China China argument.
Speaker 4 (14:35):
Okay, that's so interesting because it feels as though there
are these two different narratives. If you're a company that's
already within China that's able to do ultimately partnerships within China,
as we've seen Tesla and Minding, for example, you will
be allowed to continue and indeed potentially to thrive. But
others this is not going to be occurring. What do
(14:57):
you think of some of the Chinese companies trying to
make their presence known here in the United States team
and for example, become quite the addiction.
Speaker 1 (15:05):
Will that be allowed?
Speaker 6 (15:06):
Do you think it is right case by case.
Speaker 8 (15:09):
Well, I think it's okay if you are small and
you are under the radar, but when you get to
a certain scale and when you catch at tension, that
it becomes sensitive.
Speaker 1 (15:18):
And topical and political.
Speaker 8 (15:20):
And I think the broad sort of the political tension
definitely is a headwing and it's unlikely to be resolved
in any time soon.
Speaker 7 (15:29):
Jinang, your specialty, Your research is largely on US companies
with exposure to China. So what was your reaction to
Tesla getting tentative approval for FSD.
Speaker 8 (15:42):
I think the market runs ahead of yourself by so much.
Speaker 1 (15:46):
The partnership.
Speaker 8 (15:48):
You can say it's a milestone, but it's really light
in the terms. So think about twenty five years ago
when Ford, the gm BMW mer Cites came to the
came to China need to have a joint venture to
gain the license or ability to manufacture and sell cars
to China. So in this case it's kind of similar.
(16:10):
So Tesla is a foreign entity. To be able to
collect data and do what it does in the US,
which is oftens striving, it needs a local partner. So
in this case it's by doing it can be anyone,
So by do will be storing all the data Tesla
collects on the road and supervise the data usage and
(16:32):
the filtered before the data gets returned to Tesla for
you know, for computing. And what we do not know,
and it's critical to this puzzle, is that how the
data will be computed, whether it's onshore or offshore, and
using what capability. So I mean, I think that's the
critical sort of piece that's missing.
Speaker 1 (16:56):
And yet the market just runs ahead of yourself.
Speaker 7 (16:59):
It's in It's such an interesting point to Caro's question
on partnership. You know, in my study of China's autonomous
driving landscape, you know, by Doo is a domestic champion.
Bydo has its own ambitions for autonomous driving, and Tesla
could have gone with anyone. As you point out, why
do you think they went with Baydoo as opposed to
(17:19):
another robotaxi company.
Speaker 8 (17:21):
I think it could be anyone. It could be by Do,
it could be Pencent, it could be any mapping company.
By Do is just the gatekeeper on behalf of the government.
And what's also unknown is whether this kickoff of f
SE program in China, whether it's broadly applicable to all
Tesla vehicles on the road in China, or whether it's
(17:43):
just applicable to a group of demo demo fleet, which
is about a couple of dozens of you know, driving
by do stuff supervising or understanding the data collection process.
Speaker 1 (17:57):
That's unknown and that's critical.
Speaker 4 (18:00):
And it's critical for its long term value as a
business that's going to be standing apart from other auto companies,
legacy businesses because of its AI plan. And I'm interested
in therefore, whether you think there's that much value with
what's just going on between Tesla and China, and if
or that's a sacrifice that ultimately has to be made.
Speaker 8 (18:19):
Okay, in China, Tesla is actually not the leader in
a f speed because it didn't or automs atas autons driving,
because it doesn't have the license to collect data. It
doesn't have the data. Where it adds the competition Huawei
x pun meal, they all have their you know, uh
(18:44):
autians driving.
Speaker 1 (18:45):
System uh that's on the road.
Speaker 8 (18:48):
So they use ambidious orange chip with in house coding, right,
So that's their respective solution. So I think this partnership
is Beijing expressing sort of the relaxation of discrimination against
American companies. Say now we allow you to have access
(19:09):
to the marking data under the supervision of a Chinese entity,
and you can you know, make good use of the
data so that you are on the equal footy. Where's
your competition in China. That's the extent of that.
Speaker 4 (19:23):
It's an interesting landscape that you continue to bring clarity
on Jail. Warren Capital CEO and founder Trinhangmi, thank you
for deep diving. Now, colleges in the United States, many
are rushing to confront some pro Palestinian demonstrations on campuses,
(19:45):
with disciplinary actions escalating and campus life really thrown into turmoil.
So as the academic year comes to a close. Over
Columbia and New York, dozens of students entered a campus
building known as Hamilton Hall after midnight on Tuesday. Marracaded
themselves in side piling tables, chairs to brock doors and
covering security cameras. We want to go live to Columbia
(20:07):
University on the ground as Bloomberg Scarlet Foo and want
to make clear this is something that's happening across the US,
but it's also happening across Europe. Outside German Parliament at
the moment, we're seeing it happen at the Sorbonne in
Paris is a global element. But what's happening on the
ground right now with you, Scarlet.
Speaker 9 (20:24):
Yeah, this is ground zero, Carol line for the pro
Palestinian protests sweeping across the US college campuses and around
the world. As you said, about eleven hours ago, dozens
of Columbia students entered Hamilton Hall, which is behind me here.
They've unfurled banners, one is Free Palestine. On the other side,
there's another banner in front of Hamilton Hall that says
into Fada in red. As you mentioned, they've barricaded themselves inside.
(20:48):
They're occupying the building. They've covered security cameras with black
trash bags. And this is a building that is of
course a story because it has a history of student occupation.
In nineteen sixty eight, students protested against the Vietnam War.
In nineteen eighty five, students took over Hamilton Hall to
demand that Columbia divests from companies that do business in
(21:09):
South Africa during apartheid, and it is from that that
they take inspiration in making their demands this time around. Clearly,
this is an escalation, Caroline, and ed from the encampments
that Columbia and Barnard students set up about two weeks
ago out on the south lawn in front of Hamilton Hall.
When the President of Columbia, Manusha Figue, testified before Congress,
(21:29):
the school had given students a deadline of two pm
Monday yesterday to clear the encampments. Some did, but clearly
some had chosen to double.
Speaker 5 (21:37):
Down Scarlet real quick.
Speaker 7 (21:40):
What specifically they're demanding, I just don't get it.
Speaker 9 (21:46):
Yeah, what they're demanding is financial transparency when it comes
to the almost fourteen.
Speaker 1 (21:50):
Billion dollar endowment.
Speaker 9 (21:51):
That Columbia has, as well as divestment divesting from Israeli
companies and companies that do business with the Israeli government.
Now that's obviously are said than done, given that endowments
don't just invest in companies and bonds directly, they invest
in private equity, hedge funds, hard assets. So it's difficult
to entangle all of that.
Speaker 7 (22:10):
Bloomberg Scarlett food on the ground at Columbia. Thank you
say with us, We'll be right back. This is Bloomberg Technology.
Speaker 4 (22:22):
We welcome now our Bloomberg TV and radio audiences worldwide
to discuss what is occurring at Paramount. Currently, we'll shine
a light on how shares have been trading lower after
well first quarter earnings.
Speaker 6 (22:34):
Actually beat expectations.
Speaker 4 (22:36):
But what's actually taken the focus of Wall Street is
a CEO, Bob Backish stepping down, being replaced by a
trio of executives now being depended on, seemingly on an
interim basis to lead Paramount amid what seems to be
ongoing speculation of a deal with Skydance. We want to
get to a key long term investor in Paramount who's
(22:57):
been in the name since two thousand and six, who
believe eves in the streaming opportunity and the value of
its content. It's John Rodgers, a real investments founder co CEO.
You've been throughout this business in its many iterations, and
I just want to focus first John, on yesterday growth
being born out being shown by the business, particularly in
(23:17):
its streaming, thanks in many ways to the Super Bowl,
but it was overshadowed by the departure of Bob Backish.
Speaker 6 (23:22):
What did you make of the move now?
Speaker 1 (23:24):
It was pretty shocking to us.
Speaker 10 (23:27):
I've been Ariel's been in business for forty one years.
We've not seen anything remotely like this. It's just extraordinary,
and it can't be good for shareholders to be able
to have all this uncertainty at earning season. You're in
the middle of a merger and acquisition transaction, you're negotiating
(23:47):
with Charter Communications. All these important things are happening all
at once, and you need the CEO in place. So
this has just been very very disappointing, disheartening, and also,
in the context of what you said, business has been
getting better. A lot of the initiatives that Bob and
Bob and his executive team have worked on are really
(24:08):
starting to show fruition. So the timing just seems extremely,
extremely problematic.
Speaker 4 (24:14):
Let's just talk about probably why Bob Backish has exited,
and it is because he felt that the negotiations reportedly
underway with Skydance were not within his agreement. Now, Sherry
Redstone is a controlling shareholder at the moment with FUS
National Amusements. It seems to be the deal that she's
looking for with skuy Dance. How are you currently dealing
(24:35):
with the reports of a so called sweetened deal. What
would you make of a combination of paramount with Skuydance.
Speaker 10 (24:43):
Well, we don't know enough We've read all the same
pieces that have been written about this, and institutions like
Puck have had really good information that we've had confirmed.
And so this transaction is really is focused on Skydance.
We think that that may possibly have a chance to work,
but we really would much rather see the Apollo deal
(25:06):
with Sony that's been so rumored to be out there,
to get certainty of a you know, Apollo's a world
class firm with extraordinary resources. Sony has proven to be
so successful, you know, in this industry that seems like
a marriage made in heaven, and so we wouldn't rush
to the altar with a smaller company that's not as
proven as the Apollo and Sony.
Speaker 5 (25:29):
John, Good morning, it's ed in San Francisco.
Speaker 7 (25:32):
Do you get any sense because you've held this idea
that we should look at other offers on the table
for a while.
Speaker 5 (25:38):
Do you still hold.
Speaker 7 (25:39):
That belief but actually the hope that other offers will
be looked at, Well.
Speaker 10 (25:43):
That's we hear.
Speaker 2 (25:45):
We have.
Speaker 10 (25:45):
You know, we had a lot of confidence in management
that's been nothing but straightforward and candidate with us, that
they cared about all shareholders and you know, as you know,
the employee bases all own the secondary shares, So we
really have been very, very hopeful that they were going
to do the right thing for shareholders, and that's been
something that's been committed to us consistently, and we believe them,
(26:09):
and we just continue to think that you don't need
to rush when things are getting going well. This is
not a melting ice cube. This is a company in recovery,
in a turnaround mode. We want to make sure that
all shareholders get to be able to take advantage of that.
And the price that Skuydance is suggesting seems to us
what we've read, much lower than what we would get
from the Apollo Sony deal and many others that could
(26:31):
possibly be out there if this company was truly shopped around.
And the final thing I would say is the directors.
We know several as independent directors, and we know that
they're committed to doing what's fair for all shareholders. So
I'm hoping they'll be able to get to the finish line.
Speaker 7 (26:46):
John, what does a change of ownership structure or this
M and a path fix to Paramount?
Speaker 10 (26:55):
Well, I think that with Apollo and Sony you would
end up with enormous resources. It would help them with
their balance sheet that has, you know, gotten higher than
we would have hoped. You'll be able if you're working
with Sony. Sony has been an expert of being an
arms dealer, being able to use content and ways to
generate cash flow and profits, and have the extraordinary library
(27:15):
that Paramount brings, the history of Paramount's lot where they
have been able to make movies for generations, and there'll
be enormous synergies, you know. I think the synergies between
Sony and Paramount Paramount are much much greater than you
can imagine with a smaller company like Skydance. So we're
(27:36):
really hopeful that you'd be able to get great synergies,
higher cash flow and an experienced management team that will
be able to make those tough calls of what happens
with Pike Paramount, plus how much do you use content there?
How do you use it in selling into other competing
services like Netflix. We want that kind of experience leadership
that has been proven, and I know there are some
(27:57):
other large streamers out there they could possibly also get
into the mix.
Speaker 4 (28:01):
We are of course with John Rogers of Aerial Investments
found of Coco to our radio and TV audience. John,
regulatory issues though with both potential tie ups, is that
a concern for you?
Speaker 10 (28:14):
I think it's a modest concern for the real large
guys that are out there. I understand that people would
be worried if Netflix, for example, was to buy Paramount Global.
But ultimately, I think if people are really looking this
for the long run, you know, there's been lots of
litigation around some of the regulatory constraints that are out
there in today's economic system, I think ultimately rational people
(28:38):
will see do you want to see Paramount Plus collapse?
Do you want to see all those jobs lost? Do
you want to see a world class American company in disarray?
Or do you want to see it find a great
parent where they can merge and have a successful, growing
business over over the next decade or so. So I
think I'm hopeful that regulators will be able to make
(28:58):
the right decision, have it open mind about all the
various different possible combinations that are out there, And I
certainly think the Apollo a Sony deal should not have
any significant regulatory concerns.
Speaker 4 (29:09):
John, You've written to your own investors in your Q
one report really saying, look, you're not an activist investor,
but you feel it's your fiduciary duty to raise concerns,
particularly from a corporate governance perspective here. And I want
to go back to the fact that you have held
this stock throughout these iterations, and you've seen the fact
that there was this controlling shareholder. Did you sort of
worry this might ever evolve from this corporate governance structure?
Speaker 6 (29:33):
That particularly you're worry was.
Speaker 4 (29:35):
The fact that three independent board members have recently stepped
down amid this m and A speculation.
Speaker 10 (29:42):
You know, over the years, I've mentioned, you know, the
forty one years, we've not seen anything like this. I've
never in all the years of owning stocks that have
dual class shares, I've never seen a scenario where the
A shareholders were going to get a significantly larger premium
than the B shareholders. And that's just something we've never
seen before. And there's been a lot of smart investors,
(30:04):
it's youeno factual over the years. You know, Warren Buffett's
been a shareholder, We know Mario Gabelly, my friend Mario
has been a shareholder. We had other several good, smart
people looking at this and we've always felt that people
would do the rational thing and do the right thing
for all shareholders. That's what management's told us, Frankly, that's
what Sherry has said over time. And so we think
(30:25):
that this is something that came as a real, true surprise,
and it's something again like we've never seen before.
Speaker 7 (30:33):
John, I watched The Masters on Paramount Plus. I get
my Champions League football through Paramount Plus.
Speaker 5 (30:39):
I liked Halo.
Speaker 7 (30:40):
What is it that you like about paramounts existing portfolio
and offering.
Speaker 10 (30:46):
Well, you started at the right place. They have extraordinary
content that you know you must see. The super Bowl,
you know, had great, great ratings, Grammys were great. You
mentioned the Masters.
Speaker 5 (30:58):
They've got great scripted shows.
Speaker 10 (31:00):
The CSI franchise, the news franchise, CBS Sunday Morning sixty Minutes,
CBS Evening News, and this is robust history. But then
you put on top of it this extraordinary library with
the Paramount Greats, Mission Impossible and The Godfather. You could
go on and on and on. They've got Pluto, which
(31:20):
is an extremely successful streaming service. You've got worldwide assets
the Bob Backish used to run that are extremely valuable
and seem to get ignored by the analyst community and
the value that's there. So they have a well diversified
group of assets, many hidden assets, real estate that it
hasn't completely been utilized, institutions like Showtime and BT that
(31:42):
I wish they had found a way to have sold earlier.
But these are real, true assets to this company. And
I think sometimes people get into the group think of
the moment, they're worried about the cord cutting, and they're
forgetting to value all of the assets that Paramount Global has.
Speaker 4 (31:57):
You're a value investor, you look at the value. John,
You'll also say, you don't sell into chaos. What do
you do though, if a deal with Skuydance goes ahead.
Speaker 10 (32:07):
Well, we have been looking at all of our options.
We did write a letter to the board of directors
explaining our position. We've been, of course talking to expert
legal counsel, and our general counsel is terrific and she's
been on top of those issues. So we're looking at
all of our alternatives and we'll see how this all
plays out. But we would like to see this play
(32:29):
out in a way that is very constructive because it
would be not a good thing for a sky dancer
trying to buy a company where you're in litigation with
all of your shareholders or many of your shareholders, I
should say many of your shareholders, and at the same time,
your senior management is not going to be happy if
the deal isn't fair for the b shareholders. That's the
management team owns. And we all know M and A
(32:50):
is difficult in the best of circumstances getting all the
synergies done and all the tough calls that have to
be made, and it would be a difficult environment I
think for them to be able to be successful, while
you could have such a cleaner deal with an extraordinary
company like Apollo and Sony.
Speaker 7 (33:07):
John Rogers, Aerio Investments, founder and co CEO, grateful for
your time, Thank you, Welcome back to Member of Technology.
A quick check on the markets and three names that
we're looking because they report earnings after the bell. You're
(33:27):
either an AI or advertising story or you're both. AMD
up four ten to percent. The story is really clear.
The three hundred X is their current generation AI accelerator.
They were on track to do three and a half
billion dollars of sales this year. Will they catch up
with Nvidia? Will they pull ahead of Intel? The above
or below. That's the story. Then Amazon's down a percentage point.
(33:48):
It is interesting the bar so high following alphabet the
parent of Google and Microsoft earnings because both showed growth
in their cloud sales, but both gave us either numbers
or evidence that contrab to cloud growth specifically came from AI.
In Amazon's case, advertising is also really interesting, right, so
twelve percent overall top line growth, but it's the first
(34:09):
quarter where since January they've included ads in Prime Video?
Speaker 5 (34:13):
Does that show up as revenue? Really interesting?
Speaker 7 (34:15):
In mpinterest they're not seeing any user growth, but the
street car I thinks they might be okay because it's
been a mixed picture so far. But on the whole,
maybe advertising not so bad.
Speaker 4 (34:25):
Pinterest is just a different type of a business, isn't it.
Aired Then the fact that we've seen pinterest try to
really focus in on, well, this is a safe space,
an optimistic place, particularly in the current political narrative.
Speaker 5 (34:37):
I'd say yeah.
Speaker 7 (34:39):
And one thing I want to know as well is
like ads, meaning what like AI, ads ads or AI?
Speaker 5 (34:45):
I still don't quite get that story.
Speaker 4 (34:46):
We've got someone who knows everything about ads and AI
luckily joining us now Integral Ads Science CEO Lisa Uchneiner,
Integral ad Science actually helps advertisers at Fortune five hundred
brands measure if their campaigns are appearing next to safe,
suitable content across Metro, Instagram, TikTok, yout Pinterest, We're just
talking about Spotify, linkedins.
Speaker 6 (35:04):
Now, you name it, you measure it.
Speaker 4 (35:06):
And I'm really interested by what ultimately your bread and
buster business been looking like of late. Have brands felt
more secure through your data to come and align the
ads next to those of well use more Metapinterest, Snap
and I like.
Speaker 11 (35:21):
Sure Integral ads Science and thank you for having me.
We're a leading digital media quality company and we focus
on exactly what you're speaking to measurement optimization for over
two thousand brands worldwide. We work with the leading platforms
and publishers and we built a technology back by AI.
(35:42):
It's multimedia classification technology. We're in the live feeds of
all the major social platforms. We are classifying video, image,
audio and text ensuring that the brands are running adjacent
to brand safe and suitable.
Speaker 6 (36:00):
Content and has the date to have been getting better.
Speaker 11 (36:02):
The data is absolutely getting better. Our technology is highly sophisticated.
We're classifying frame by frame and what I mean by that,
if there's let's say a thirty second TikTok video running,
we are classifying every single second of that thirty second
TikTok video to ensure brands aren't running adjacent to unsuitable
(36:26):
content like hate speech, violence, and as we rolled out recently, misinformation.
Speaker 7 (36:33):
Lisa is Pinterest a platform you take seriously in the
context of ads.
Speaker 11 (36:39):
The brands take all of the platforms seriously, including Pinterest,
And as you look at the size of the digital
advertising market space and the fact that advertisers they're pouring
billions and billions of dollars into digital advertising, they want
to ensure that an independent verification company like Integral ad Science,
(37:02):
we are classifying and verifying the quality of the media,
and that we're holding the platforms accountable and responsible again,
ensuring that we're identifying the inappropriate stuff and helping advertisers
run their brands adjacent to more appropriate, brand suitable content.
Speaker 4 (37:23):
And we'll see how those social media companies have benefited
from some of that growing confidence research.
Speaker 6 (37:28):
Snider, we thank you for being hit Intagled ad Science.
Speaker 7 (37:30):
CEO Changpeng cz Jow, the billionaire founder of the Binance
Crypto Exchange is starting his sentencing hearing today on anti
money laundering charges and prosecutors recommending the court give him
(37:50):
three years in prison, double the maximum that guidelines prescribe.
Let's go out to Bluebo's Olga Krief, who has all
the details of what are we expecting.
Speaker 12 (38:00):
So we are expecting the hearing perhaps to last not
very long, in a couple of hours. CZ will probably
speak at the hearing, and his lawyers are pushing for
probation and sort of much you know, less harsh sentence
than what the prosecution has asked for. And of course
(38:22):
you'll recall that in November CZ pled guilty to a
number of charges and he agreed to pay a fifty
million dollar fine, and Binance agreed to a four point
three billion dollar fine, and today we'll find out sort
of what happens to him. He still retains his ownership
(38:44):
of Finance, which has been doing extremely well, especially in
this year's sort of cryptoble market, driven by the introduction
of US Spot bitcoin exchange exchange traded funds.
Speaker 4 (39:02):
Well, Olga Curf, we thank you for really an amazing read.
Speaker 6 (39:05):
It's the big take today, go online, go check it out.
Because it really is about.
Speaker 4 (39:09):
Ultimately the fortune of cz and how that doesn't seem
to be being vented anytime soon, whether he says prison
time or not. Meanwhile, though, there is a whole raft
of other crypto news to be getting into in a
batch of ets. So we're just talking about investing directly
in crypto just debuted over.
Speaker 6 (39:23):
In Hong Kong.
Speaker 4 (39:24):
So is this competition to the US bitcoin products? Is
this going to bring in new investors, particularly.
Speaker 6 (39:29):
Over in Asia?
Speaker 4 (39:30):
Still Mark founder and managing partner and ease Colleen joins us. Now,
look still coin. Still Mark is a bitcoin focus venture
capital firm. We got eighty five million dollars in assets
on a management You've been doing this for a long time,
looking at the protocols, the real use cases of bitcoin.
This is eth and Bitcoin spot ETF. What does this
mean for the industry.
Speaker 13 (39:51):
Well, it's the first time we're seeing the ETF perform
against Bitcoin ETF. And what we saw in Hong Kong's
day one launch was that much of the activity, the
vast majority of the activity was in the Bitcoin ETF.
We saw about just under thirteen million dollars of trading activity,
which is a lot for the Hong Kong market sized
(40:12):
at fifty billion. Issuer China AMC has reported one hundred
and forty one million dollars in assets under management after
day one, and eighty six percent of that is in
the Bitcoin spot ETF.
Speaker 7 (40:25):
At least, Why is it important that we have multiple
markets New York, Hong Kong. We talked the other day
about Australia thinking about its place in this market.
Speaker 1 (40:36):
It's a great question.
Speaker 13 (40:37):
First of all, of course, Bitcoin's price is a product
of adoption and expansion of its utility set. As esetfs
are introduced in new markets and new geographies, we are
advancing adoption. We're bringing a new group of users into
bitcoin through a regulated product, albeit one that relies, of
course on a custodian We're also moving closer to having
(41:01):
a twenty four to seven spot ETF market. Of course,
with the addition of Hong Kong.
Speaker 4 (41:08):
I'm interested in Hong Kong specifically because of his relationship
with China and the regulatory oversight. What does this mean
for China's relationship with crypto, Yes, exactly.
Speaker 13 (41:19):
Many are interested for exactly the same reason now, of course,
in the launch of the Bitcoin and East Spot ETFs
in Hong Kong. People in China do not have access,
so it's a more curtailed audience. Of course, that said,
we are still introducing an entirely new audience, and one
(41:43):
that one that thinks differently, has different has exposure to
different media sources, and we expect that this is a
positive sign for broader proliferation of bitcoin products in Hong
Kong and in the reg and exposed to this product still.
Speaker 7 (42:04):
Mark founder and managing partner Elisa Colleen, we really appreciate
your real time global perspective, and fortunately for our audience,
there's more coverage of those ETFs and the CZ sentencing
at the top of the next hour on Bloomberg Crypto.
The understanding is that in the CZ hearing at least
carow a lot of that will kick off around midday
(42:24):
New York time, which is nine am out here on
the West.
Speaker 4 (42:27):
Pretty perfect if you want to be digesting that in
real time with a crypto show, but we sort of
tease ahead to it, but for now, that's our job
done on this edition of Bloombog Technology.
Speaker 7 (42:36):
Yeah, a really massive after market earning situation that we're
going to be tuned into and tomorrow is going to
be a big discussion on that. The pod on Apple, Spotify.
iHeart the Bloomberg platforms. Thank you to listening to the podcast.
This is Bloomberg Technology.
Bloomberg Audio Studios, podcasts, radio news.
Speaker 2 (00:07):
From Mahart where Innovation, money and power Collie in Silicon Valley, NBN.
Speaker 3 (00:13):
This is Bloomberg Technology with Caroline Hyde and Ed loved Love.
Speaker 4 (00:31):
I'm Caroline Hein and Bloomberg's World headquarters in New York
and I'm Ed Ludlow in San Francisco.
Speaker 5 (00:35):
This is Bloomberg Technology.
Speaker 4 (00:37):
Coming up paramount for places at CEO as M and
a buzz over shadows results.
Speaker 6 (00:42):
Full coverage ahead, plus.
Speaker 7 (00:44):
We push ahead to result from Amazon, AMD and Pinterest,
all reporting after the belt.
Speaker 6 (00:49):
And former finance CEO at CZ heads.
Speaker 4 (00:52):
To court as prosecutors seek three years in prison. Will
bring you the latest headlines as they cross, but first
a check in on these markets and look, the macro
picture not looking so pretty today and it forces stocks lower.
You get well the cost of labor at the moment,
the ECI number coming in higher than expected, and well
overall confidence from a consumer plunging.
Speaker 6 (01:11):
That means we're not looking so pretty.
Speaker 4 (01:13):
Heading into a Federal Reserve meeting that of course ends tomorrow,
and we hear from Jaypower off by four ten percent
on the NASDAK tenure yield pushing higher of course, where
boring costs rise, So stock's full.
Speaker 6 (01:22):
We're at four point sixty six, that's what usually the
trend is.
Speaker 4 (01:25):
We're seeing dollar stronger versus the Japanese end today, a
completely flip reverse from yesterday. Looks as though Japan did
indeed have some intervention into the markets to try and
prop up the yen. For now it's weaker against the
US dollar. Let's move on to have a look at
what's also we could get versus the US dollar. Bitcoin
along with other risk asset said on the downside, rob
by two point percent, sixty one thousand. This is wrapping
(01:46):
up to be a pretty poor month of April, the worst.
Speaker 6 (01:48):
Since, of course the FTX scandal.
Speaker 4 (01:51):
Down somewhat sixteen percent over the course of April for bitcoin,
and indeed we're seeing a pretty.
Speaker 6 (01:55):
Poor month for stocks.
Speaker 4 (01:56):
More overall, Nasdaq I think having its worst months since October.
Speaker 6 (02:00):
What do you think of the micro today?
Speaker 5 (02:02):
Okay, so there's a lot going on real quick.
Speaker 7 (02:03):
Tesla is down more than four percent, the information reporting
the entire supercharger team is gone. But remember twenty four
hours ago in Monday session, fifteen percent gain, biggest jump
since March of twenty twenty one on FSD tentative approval
on China. We'll dig into that later. Then there's earnings
AMD after the Bell. We know the story how well,
(02:24):
but above or below is the mi I three hundred
x done relative to expectations. Then you've got Amazon after
Alphabet and Microsoft Cloud growth driven by AI. We know
those stories and were look ahead to that later in
the program. Our top story is Paramount Global, so CEO
Bob Bakish is gone, replaced by basically a committee of executives.
(02:44):
They release earnings. No one seems to care. The question
is about M and A in the future. The stockdown
three point three percent. Let's go right to Bloomberg Intelligence
and this guita rangon Nathan to try and understand what's
going on. I love the kind of headline of your
research overnight, basically earnings and non.
Speaker 5 (02:59):
Av I on M and A.
Speaker 7 (03:01):
But just summarize what last night was like for you
and what you learned.
Speaker 3 (03:05):
Yes, yeah, the earnings call ed was was kind of
really bizarre. I mean it was, you know, a seven
to eight minute call, basically one of the shortest I've
ever seen in the history of media earnings. There were
no questions from the analyst or the investment community, and
it was just basically the CFO outlining the details of
the quarter, and you know, the three person committee kind
(03:26):
of giving their little spiel. But I think yes, there
were some encouraging elements from the first quarter results, but
of course M and A is stop and center overall.
I think that the key takeaway is that this is
peak uncertainty right now at Paramount. We really don't know
what's happening with ownership. We don't know what's happening with
leadership other than there is this committee. But obviously it's
(03:49):
a stop gap arrangement and there's no clue in terms
of what the future direction or the strategy is.
Speaker 4 (03:55):
Have you ever experienced this, Ketha, this lack of clarity
coming from leadership, coming from the company itself.
Speaker 3 (04:02):
Yeah, I mean this is kind of one of a
kind situation, Caroline. I mean, obviously, Sherry Redstone here is
desperately trying to get a deal done with sky Dance,
which is why she had to get rid of Barb Bakish,
who was opposing the deal pretty vocally from the get go.
Speaker 6 (04:21):
You know, there is a looming deadline.
Speaker 3 (04:23):
May third is the day which is Friday is the
day when the period of exclusive negotiations ends, and so
they're trying to do everything in their power to get
to that finish line as quickly as possible.
Speaker 4 (04:34):
Well, we dig into what is a very evolving story,
but ultimately with some decent streaming numbers come from Paramount,
we want to dig into all of that. First, we
thanks Bloomberg Intelligence ANALYSTKEITHA. Rangnath, and let's continue the conversation
with an expert in the field of media and ultimately
what on earth this landscape is like to try to
evolve Paramount. Going forward John Clines with US co founder
(04:54):
SEO of the sports streaming platform Handed Media. We'll also
form a president of CNN executive VP of CBS New Boyd.
Do you understand the internal workings of these sorts of
companies And I put it to you again, I mean,
there's a corporate governance issue going on at the moment.
But what should Paramount try you to be doing in
terms of its fundamentals right now?
Speaker 2 (05:13):
Well, you know I have experienced this before because I
was the media advisor to the show Succession, and I
have to tell you if you know so.
Speaker 1 (05:22):
Mayhem was our middle name. But if they'd come.
Speaker 2 (05:25):
To me with a plot twist that said they were
going to dump the CEO two hours before earnings, I
would have thrown it right back in their faces. I
would have said, no way anyway. You know, look, every
acquirer feels they can either grow an asset, or squeeze
additional profit out of the distressed parts, or just sell
(05:45):
off the parts. I wouldn't be surprised if David Ellison
feels that he lands in the growth camp. You know,
he's young, he's energetic, he has excellent taste. I love
some of the movies that he's produced, and he's got
Jeff Shell as a partner in Jeff is a really
savvy operator, you know, as he was when he was
CEO of NBC Universal. I think that the challenge for
(06:08):
any traditional media company in a landscape that is dominated
by the tech giants, right Apple, Amazon, Google. You know,
YouTube alone accounts for ten percent of the of the
TV viewing now on televisions, not not on devices. The
(06:30):
tech giants are dominating the media landscape, and so whoever
ends up owning Paramount has to think hard about that.
They have to think about streaming as a strategy you know,
because what streaming does is on the line.
Speaker 7 (06:48):
Let me just jump in real quick, John, because I
get that that they're technology companies. They're good at technology.
Caroline and I were discussing before the show. I quite
like Paramount. I like the streaming platform. I watch all
my Champions League football on Paramount Plus. I liked Taylo
it was pretty good. I like some of the Paramount movies.
Top Gun as an example of the Transformers movies. Who
(07:09):
doesn't what's missing, then what's the fix?
Speaker 1 (07:13):
I'll tell you what's missing.
Speaker 2 (07:14):
AI AI is what's driving streaming because it powers all
those deep audience insights that allow you to make smarter
programming decisions, more precision targeted marketing decisions. On my streaming
platform has seen our cost of acquiring a customer drop
from thirty four dollars to two dollars in one year's
time thanks to precision targeting AI. And David Ellison knows
(07:38):
somebody who is pretty good at the aipiece of it,
and that's his dad. And his dad is one of
the investor. Or Oracle is going to be among the
investors in this. And if you add Oracle AI power
to some of the assets that paramount owns you inch
closer anyway toward the giants.
Speaker 1 (08:00):
You're not a giant yet.
Speaker 2 (08:01):
Their market cap, I think is three hundred and fifty
times smaller than the big boys, but you're heading in
the right direction and that would be a smart thing
for them to do.
Speaker 4 (08:11):
So for you, this is a tech growth perspective coming
from Skydance Media. A lot of investors, though, have completely
seen an erosion in the value of their non voting stock.
They're frustrated that this isn't going to be some more
open bidding competition going on. John, is there a better,
more clear way of doing this to try? And we'll
hear clarity from Skydance and then see what others say.
(08:33):
The reports of an Apollo and a Sony could add themselves.
Speaker 2 (08:37):
Yeah, I mean, Skydance, you know, needs to play its
cards close to the vest in the short run. And
of course, if they end up winning the prize versus
Apollo slash Sony, you know, then they've got to lay
out a strategy and you know that's what the street
is going to be looking for work. And you know,
AI can't be ignored and you know, should obviously be
(09:01):
a central part of things. But look, family controlled or
single entity controlled companies invariably lead.
Speaker 1 (09:10):
To this kind of messiness.
Speaker 2 (09:13):
And if whoever ends up with it, at least you
would hope that things will the operation will run more cleanly.
Speaker 7 (09:20):
Moving forward, John, Of all the subscriptions you can have,
where does powamount rank?
Speaker 2 (09:28):
Look, I'm not alone in saying I churn constantly. Did
you know that only seven percent of people will tell
you that they plan to stick with the streaming platform
that they currently subscribe to. This month, ninety three percent
of viewers intend to leave. And that's because people watch
shows and stars, they don't watch platforms. That's equally applicable
(09:53):
to Netflix and Disney Plus and all of them. And
so you know, you've got to think in terms of
franchises that are driving the bus for a business. So,
you know, for paramount, the first one that jumps into
my mind.
Speaker 1 (10:08):
Is the NFL.
Speaker 2 (10:09):
I mean, the NFL dominates viewership on whatever platform at Arizona,
whether it's streaming on Amazon Prime or it's the traditional
broadcast networks.
Speaker 1 (10:17):
You know, they news.
Speaker 2 (10:19):
Streaming services are also drivers of streaming, and CBS just
rebranded their entire CBS News Streaming entity into CBS News
twenty four to seven, and so they've got to be
thinking streaming first, direct to consumer first, AI.
Speaker 5 (10:34):
Right, and the masters as well.
Speaker 7 (10:35):
Good example, if you're going to get one chunk off
or divest a bit, what would it be.
Speaker 2 (10:41):
The cable channels just you know, they're they're they're kind
of hopeless.
Speaker 1 (10:47):
I mean, they've lost their luster.
Speaker 2 (10:49):
I think you know, they tend to just play the
same show fifty thousand times in a row and a block,
which I like as a consumer. I can put the
Office on on other channels, you know, and all that.
But it's a dwindling asset. Everyone knows that. It's not
a surprise. I think they had some offers for some
of the cable channels in the past year. Part of
the friction between Redstone and Backish was that he didn't
(11:12):
sell some of.
Speaker 1 (11:13):
Them fast enough or at all. But that's where you'd
have to look.
Speaker 6 (11:18):
John.
Speaker 4 (11:18):
I'm just going to go bigger here because it's so
interesting what you bring about the technology story that needs
to be injected into Powermount. Of course, you were at
berninks AI, which was sold to Apple. You've got a
big focus on the AI compartment, but do you think
were broadly this is going to be happening elsewhere in
the industry. Paramount is a but one where we think
m and A or rejuvenation is needed within some of
(11:40):
these legacy businesses.
Speaker 2 (11:41):
Oh yeah, I mean, look, the market cap gap is
just enormous.
Speaker 1 (11:46):
I mean, the tech.
Speaker 2 (11:47):
Giants are three hundred and fifty times bigger than even
the you know, the biggest, most well known traditional media companies,
Warner Brothers, Discovery, you know, Netflix, even I think we
have to start thinking of as a traditional media company
because the only thing they do is entertainment programming and
now they're introducing sports, but they have no tech component.
(12:08):
They have no theme parks, you know, to mitigate risk
or anything. So they're a pure playing media company. I
think there's bound to be consolidation amidst those and if
Paramount is smart about pursuing the AI and streaming opportunities,
they become a more attractive merger or acquisition target as
those smaller players, the smaller planets come.
Speaker 7 (12:30):
Together joining Bloomberg Technology, a show available live and on
demand on lots of platforms. Looking around for a long time.
Hang Media co founder and CEO John Klin. Great to
have your perspective. Thank you, know, coming up, we're going
to take a look at the intensifying tech war between
the US and China. Just days after Elon Musk reached
that big milestone on FSD. That conversation coming up, this
(12:52):
is Bloomberg technology. The law requiring TikTok to divest or
be banned could be a pivotal moment in what is
(13:13):
an escalating rivalry between the US and China in the
context of technology. TikTok for the US would almost certainly
head to the Supreme Court, which would have to weigh
the government's security concerns against the free speech of the company.
And it's all but certain that China will retaliate against
the US. And that is according to those that watch
(13:33):
China's government in its responses closely. There's a lot to
discuss right now in the relationship between China and US
in the context of tech.
Speaker 5 (13:39):
And to do that we bring in Jen Haglee.
Speaker 7 (13:41):
The CEO and founder and head of researcher JL Warren Capital.
Let's just start with the TikTok case study. You know,
byte Dance is the world's most valuable startup, a Chinese giant,
but private, and it's said we have no plan to
sell divest TikTok in the States, but it's somewhere that
the States is just not going to accept your view
(14:03):
on that outcome.
Speaker 8 (14:05):
Well, I think it's inevitable that the two entities US
operation will be separated from the parent because consumer data
in US are just way too way too rich in
content and the way too sensitive for the same poken.
Speaker 1 (14:20):
I mean, I just think the.
Speaker 8 (14:21):
Reason announcement of Testda Bayd is a very case specific situation.
It's not applicable to sort of the broad de escalating
tension between the US and China China argument.
Speaker 4 (14:35):
Okay, that's so interesting because it feels as though there
are these two different narratives. If you're a company that's
already within China that's able to do ultimately partnerships within China,
as we've seen Tesla and Minding, for example, you will
be allowed to continue and indeed potentially to thrive. But
others this is not going to be occurring. What do
(14:57):
you think of some of the Chinese companies trying to
make their presence known here in the United States team
and for example, become quite the addiction.
Speaker 1 (15:05):
Will that be allowed?
Speaker 6 (15:06):
Do you think it is right case by case.
Speaker 8 (15:09):
Well, I think it's okay if you are small and
you are under the radar, but when you get to
a certain scale and when you catch at tension, that
it becomes sensitive.
Speaker 1 (15:18):
And topical and political.
Speaker 8 (15:20):
And I think the broad sort of the political tension
definitely is a headwing and it's unlikely to be resolved
in any time soon.
Speaker 7 (15:29):
Jinang, your specialty, Your research is largely on US companies
with exposure to China. So what was your reaction to
Tesla getting tentative approval for FSD.
Speaker 8 (15:42):
I think the market runs ahead of yourself by so much.
Speaker 1 (15:46):
The partnership.
Speaker 8 (15:48):
You can say it's a milestone, but it's really light
in the terms. So think about twenty five years ago
when Ford, the gm BMW mer Cites came to the
came to China need to have a joint venture to
gain the license or ability to manufacture and sell cars
to China. So in this case it's kind of similar.
(16:10):
So Tesla is a foreign entity. To be able to
collect data and do what it does in the US,
which is oftens striving, it needs a local partner. So
in this case it's by doing it can be anyone,
So by do will be storing all the data Tesla
collects on the road and supervise the data usage and
(16:32):
the filtered before the data gets returned to Tesla for
you know, for computing. And what we do not know,
and it's critical to this puzzle, is that how the
data will be computed, whether it's onshore or offshore, and
using what capability. So I mean, I think that's the
critical sort of piece that's missing.
Speaker 1 (16:56):
And yet the market just runs ahead of yourself.
Speaker 7 (16:59):
It's in It's such an interesting point to Caro's question
on partnership. You know, in my study of China's autonomous
driving landscape, you know, by Doo is a domestic champion.
Bydo has its own ambitions for autonomous driving, and Tesla
could have gone with anyone. As you point out, why
do you think they went with Baydoo as opposed to
(17:19):
another robotaxi company.
Speaker 8 (17:21):
I think it could be anyone. It could be by Do,
it could be Pencent, it could be any mapping company.
By Do is just the gatekeeper on behalf of the government.
And what's also unknown is whether this kickoff of f
SE program in China, whether it's broadly applicable to all
Tesla vehicles on the road in China, or whether it's
(17:43):
just applicable to a group of demo demo fleet, which
is about a couple of dozens of you know, driving
by do stuff supervising or understanding the data collection process.
Speaker 1 (17:57):
That's unknown and that's critical.
Speaker 4 (18:00):
And it's critical for its long term value as a
business that's going to be standing apart from other auto companies,
legacy businesses because of its AI plan. And I'm interested
in therefore, whether you think there's that much value with
what's just going on between Tesla and China, and if
or that's a sacrifice that ultimately has to be made.
Speaker 8 (18:19):
Okay, in China, Tesla is actually not the leader in
a f speed because it didn't or automs atas autons driving,
because it doesn't have the license to collect data. It
doesn't have the data. Where it adds the competition Huawei
x pun meal, they all have their you know, uh
(18:44):
autians driving.
Speaker 1 (18:45):
System uh that's on the road.
Speaker 8 (18:48):
So they use ambidious orange chip with in house coding, right,
So that's their respective solution. So I think this partnership
is Beijing expressing sort of the relaxation of discrimination against
American companies. Say now we allow you to have access
(19:09):
to the marking data under the supervision of a Chinese entity,
and you can you know, make good use of the
data so that you are on the equal footy. Where's
your competition in China. That's the extent of that.
Speaker 4 (19:23):
It's an interesting landscape that you continue to bring clarity
on Jail. Warren Capital CEO and founder Trinhangmi, thank you
for deep diving. Now, colleges in the United States, many
are rushing to confront some pro Palestinian demonstrations on campuses,
(19:45):
with disciplinary actions escalating and campus life really thrown into turmoil.
So as the academic year comes to a close. Over
Columbia and New York, dozens of students entered a campus
building known as Hamilton Hall after midnight on Tuesday. Marracaded
themselves in side piling tables, chairs to brock doors and
covering security cameras. We want to go live to Columbia
(20:07):
University on the ground as Bloomberg Scarlet Foo and want
to make clear this is something that's happening across the US,
but it's also happening across Europe. Outside German Parliament at
the moment, we're seeing it happen at the Sorbonne in
Paris is a global element. But what's happening on the
ground right now with you, Scarlet.
Speaker 9 (20:24):
Yeah, this is ground zero, Carol line for the pro
Palestinian protests sweeping across the US college campuses and around
the world. As you said, about eleven hours ago, dozens
of Columbia students entered Hamilton Hall, which is behind me here.
They've unfurled banners, one is Free Palestine. On the other side,
there's another banner in front of Hamilton Hall that says
into Fada in red. As you mentioned, they've barricaded themselves inside.
(20:48):
They're occupying the building. They've covered security cameras with black
trash bags. And this is a building that is of
course a story because it has a history of student occupation.
In nineteen sixty eight, students protested against the Vietnam War.
In nineteen eighty five, students took over Hamilton Hall to
demand that Columbia divests from companies that do business in
(21:09):
South Africa during apartheid, and it is from that that
they take inspiration in making their demands this time around. Clearly,
this is an escalation, Caroline, and ed from the encampments
that Columbia and Barnard students set up about two weeks
ago out on the south lawn in front of Hamilton Hall.
When the President of Columbia, Manusha Figue, testified before Congress,
(21:29):
the school had given students a deadline of two pm
Monday yesterday to clear the encampments. Some did, but clearly
some had chosen to double.
Speaker 5 (21:37):
Down Scarlet real quick.
Speaker 7 (21:40):
What specifically they're demanding, I just don't get it.
Speaker 9 (21:46):
Yeah, what they're demanding is financial transparency when it comes
to the almost fourteen.
Speaker 1 (21:50):
Billion dollar endowment.
Speaker 9 (21:51):
That Columbia has, as well as divestment divesting from Israeli
companies and companies that do business with the Israeli government.
Now that's obviously are said than done, given that endowments
don't just invest in companies and bonds directly, they invest
in private equity, hedge funds, hard assets. So it's difficult
to entangle all of that.
Speaker 7 (22:10):
Bloomberg Scarlett food on the ground at Columbia. Thank you
say with us, We'll be right back. This is Bloomberg Technology.
Speaker 4 (22:22):
We welcome now our Bloomberg TV and radio audiences worldwide
to discuss what is occurring at Paramount. Currently, we'll shine
a light on how shares have been trading lower after
well first quarter earnings.
Speaker 6 (22:34):
Actually beat expectations.
Speaker 4 (22:36):
But what's actually taken the focus of Wall Street is
a CEO, Bob Backish stepping down, being replaced by a
trio of executives now being depended on, seemingly on an
interim basis to lead Paramount amid what seems to be
ongoing speculation of a deal with Skydance. We want to
get to a key long term investor in Paramount who's
(22:57):
been in the name since two thousand and six, who
believe eves in the streaming opportunity and the value of
its content. It's John Rodgers, a real investments founder co CEO.
You've been throughout this business in its many iterations, and
I just want to focus first John, on yesterday growth
being born out being shown by the business, particularly in
(23:17):
its streaming, thanks in many ways to the Super Bowl,
but it was overshadowed by the departure of Bob Backish.
Speaker 6 (23:22):
What did you make of the move now?
Speaker 1 (23:24):
It was pretty shocking to us.
Speaker 10 (23:27):
I've been Ariel's been in business for forty one years.
We've not seen anything remotely like this. It's just extraordinary,
and it can't be good for shareholders to be able
to have all this uncertainty at earning season. You're in
the middle of a merger and acquisition transaction, you're negotiating
(23:47):
with Charter Communications. All these important things are happening all
at once, and you need the CEO in place. So
this has just been very very disappointing, disheartening, and also,
in the context of what you said, business has been
getting better. A lot of the initiatives that Bob and
Bob and his executive team have worked on are really
(24:08):
starting to show fruition. So the timing just seems extremely,
extremely problematic.
Speaker 4 (24:14):
Let's just talk about probably why Bob Backish has exited,
and it is because he felt that the negotiations reportedly
underway with Skydance were not within his agreement. Now, Sherry
Redstone is a controlling shareholder at the moment with FUS
National Amusements. It seems to be the deal that she's
looking for with skuy Dance. How are you currently dealing
(24:35):
with the reports of a so called sweetened deal. What
would you make of a combination of paramount with Skuydance.
Speaker 10 (24:43):
Well, we don't know enough We've read all the same
pieces that have been written about this, and institutions like
Puck have had really good information that we've had confirmed.
And so this transaction is really is focused on Skydance.
We think that that may possibly have a chance to work,
but we really would much rather see the Apollo deal
(25:06):
with Sony that's been so rumored to be out there,
to get certainty of a you know, Apollo's a world
class firm with extraordinary resources. Sony has proven to be
so successful, you know, in this industry that seems like
a marriage made in heaven, and so we wouldn't rush
to the altar with a smaller company that's not as
proven as the Apollo and Sony.
Speaker 5 (25:29):
John, Good morning, it's ed in San Francisco.
Speaker 7 (25:32):
Do you get any sense because you've held this idea
that we should look at other offers on the table
for a while.
Speaker 5 (25:38):
Do you still hold.
Speaker 7 (25:39):
That belief but actually the hope that other offers will
be looked at, Well.
Speaker 10 (25:43):
That's we hear.
Speaker 2 (25:45):
We have.
Speaker 10 (25:45):
You know, we had a lot of confidence in management
that's been nothing but straightforward and candidate with us, that
they cared about all shareholders and you know, as you know,
the employee bases all own the secondary shares, So we
really have been very, very hopeful that they were going
to do the right thing for shareholders, and that's been
something that's been committed to us consistently, and we believe them,
(26:09):
and we just continue to think that you don't need
to rush when things are getting going well. This is
not a melting ice cube. This is a company in recovery,
in a turnaround mode. We want to make sure that
all shareholders get to be able to take advantage of that.
And the price that Skuydance is suggesting seems to us
what we've read, much lower than what we would get
from the Apollo Sony deal and many others that could
(26:31):
possibly be out there if this company was truly shopped around.
And the final thing I would say is the directors.
We know several as independent directors, and we know that
they're committed to doing what's fair for all shareholders. So
I'm hoping they'll be able to get to the finish line.
Speaker 7 (26:46):
John, what does a change of ownership structure or this
M and a path fix to Paramount?
Speaker 10 (26:55):
Well, I think that with Apollo and Sony you would
end up with enormous resources. It would help them with
their balance sheet that has, you know, gotten higher than
we would have hoped. You'll be able if you're working
with Sony. Sony has been an expert of being an
arms dealer, being able to use content and ways to
generate cash flow and profits, and have the extraordinary library
(27:15):
that Paramount brings, the history of Paramount's lot where they
have been able to make movies for generations, and there'll
be enormous synergies, you know. I think the synergies between
Sony and Paramount Paramount are much much greater than you
can imagine with a smaller company like Skydance. So we're
(27:36):
really hopeful that you'd be able to get great synergies,
higher cash flow and an experienced management team that will
be able to make those tough calls of what happens
with Pike Paramount, plus how much do you use content there?
How do you use it in selling into other competing
services like Netflix. We want that kind of experience leadership
that has been proven, and I know there are some
(27:57):
other large streamers out there they could possibly also get
into the mix.
Speaker 4 (28:01):
We are of course with John Rogers of Aerial Investments
found of Coco to our radio and TV audience. John,
regulatory issues though with both potential tie ups, is that
a concern for you?
Speaker 10 (28:14):
I think it's a modest concern for the real large
guys that are out there. I understand that people would
be worried if Netflix, for example, was to buy Paramount Global.
But ultimately, I think if people are really looking this
for the long run, you know, there's been lots of
litigation around some of the regulatory constraints that are out
there in today's economic system, I think ultimately rational people
(28:38):
will see do you want to see Paramount Plus collapse?
Do you want to see all those jobs lost? Do
you want to see a world class American company in disarray?
Or do you want to see it find a great
parent where they can merge and have a successful, growing
business over over the next decade or so. So I
think I'm hopeful that regulators will be able to make
(28:58):
the right decision, have it open mind about all the
various different possible combinations that are out there, And I
certainly think the Apollo a Sony deal should not have
any significant regulatory concerns.
Speaker 4 (29:09):
John, You've written to your own investors in your Q
one report really saying, look, you're not an activist investor,
but you feel it's your fiduciary duty to raise concerns,
particularly from a corporate governance perspective here. And I want
to go back to the fact that you have held
this stock throughout these iterations, and you've seen the fact
that there was this controlling shareholder. Did you sort of
worry this might ever evolve from this corporate governance structure?
Speaker 6 (29:33):
That particularly you're worry was.
Speaker 4 (29:35):
The fact that three independent board members have recently stepped
down amid this m and A speculation.
Speaker 10 (29:42):
You know, over the years, I've mentioned, you know, the
forty one years, we've not seen anything like this. I've
never in all the years of owning stocks that have
dual class shares, I've never seen a scenario where the
A shareholders were going to get a significantly larger premium
than the B shareholders. And that's just something we've never
seen before. And there's been a lot of smart investors,
(30:04):
it's youeno factual over the years. You know, Warren Buffett's
been a shareholder, We know Mario Gabelly, my friend Mario
has been a shareholder. We had other several good, smart
people looking at this and we've always felt that people
would do the rational thing and do the right thing
for all shareholders. That's what management's told us, Frankly, that's
what Sherry has said over time. And so we think
(30:25):
that this is something that came as a real, true surprise,
and it's something again like we've never seen before.
Speaker 7 (30:33):
John, I watched The Masters on Paramount Plus. I get
my Champions League football through Paramount Plus.
Speaker 5 (30:39):
I liked Halo.
Speaker 7 (30:40):
What is it that you like about paramounts existing portfolio
and offering.
Speaker 10 (30:46):
Well, you started at the right place. They have extraordinary
content that you know you must see. The super Bowl,
you know, had great, great ratings, Grammys were great. You
mentioned the Masters.
Speaker 5 (30:58):
They've got great scripted shows.
Speaker 10 (31:00):
The CSI franchise, the news franchise, CBS Sunday Morning sixty Minutes,
CBS Evening News, and this is robust history. But then
you put on top of it this extraordinary library with
the Paramount Greats, Mission Impossible and The Godfather. You could
go on and on and on. They've got Pluto, which
(31:20):
is an extremely successful streaming service. You've got worldwide assets
the Bob Backish used to run that are extremely valuable
and seem to get ignored by the analyst community and
the value that's there. So they have a well diversified
group of assets, many hidden assets, real estate that it
hasn't completely been utilized, institutions like Showtime and BT that
(31:42):
I wish they had found a way to have sold earlier.
But these are real, true assets to this company. And
I think sometimes people get into the group think of
the moment, they're worried about the cord cutting, and they're
forgetting to value all of the assets that Paramount Global has.
Speaker 4 (31:57):
You're a value investor, you look at the value. John,
You'll also say, you don't sell into chaos. What do
you do though, if a deal with Skuydance goes ahead.
Speaker 10 (32:07):
Well, we have been looking at all of our options.
We did write a letter to the board of directors
explaining our position. We've been, of course talking to expert
legal counsel, and our general counsel is terrific and she's
been on top of those issues. So we're looking at
all of our alternatives and we'll see how this all
plays out. But we would like to see this play
(32:29):
out in a way that is very constructive because it
would be not a good thing for a sky dancer
trying to buy a company where you're in litigation with
all of your shareholders or many of your shareholders, I
should say many of your shareholders, and at the same time,
your senior management is not going to be happy if
the deal isn't fair for the b shareholders. That's the
management team owns. And we all know M and A
(32:50):
is difficult in the best of circumstances getting all the
synergies done and all the tough calls that have to
be made, and it would be a difficult environment I
think for them to be able to be successful, while
you could have such a cleaner deal with an extraordinary
company like Apollo and Sony.
Speaker 7 (33:07):
John Rogers, Aerio Investments, founder and co CEO, grateful for
your time, Thank you, Welcome back to Member of Technology.
A quick check on the markets and three names that
we're looking because they report earnings after the bell. You're
(33:27):
either an AI or advertising story or you're both. AMD
up four ten to percent. The story is really clear.
The three hundred X is their current generation AI accelerator.
They were on track to do three and a half
billion dollars of sales this year. Will they catch up
with Nvidia? Will they pull ahead of Intel? The above
or below. That's the story. Then Amazon's down a percentage point.
(33:48):
It is interesting the bar so high following alphabet the
parent of Google and Microsoft earnings because both showed growth
in their cloud sales, but both gave us either numbers
or evidence that contrab to cloud growth specifically came from AI.
In Amazon's case, advertising is also really interesting, right, so
twelve percent overall top line growth, but it's the first
(34:09):
quarter where since January they've included ads in Prime Video?
Speaker 5 (34:13):
Does that show up as revenue? Really interesting?
Speaker 7 (34:15):
In mpinterest they're not seeing any user growth, but the
street car I thinks they might be okay because it's
been a mixed picture so far. But on the whole,
maybe advertising not so bad.
Speaker 4 (34:25):
Pinterest is just a different type of a business, isn't it.
Aired Then the fact that we've seen pinterest try to
really focus in on, well, this is a safe space,
an optimistic place, particularly in the current political narrative.
Speaker 5 (34:37):
I'd say yeah.
Speaker 7 (34:39):
And one thing I want to know as well is
like ads, meaning what like AI, ads ads or AI?
Speaker 5 (34:45):
I still don't quite get that story.
Speaker 4 (34:46):
We've got someone who knows everything about ads and AI
luckily joining us now Integral Ads Science CEO Lisa Uchneiner,
Integral ad Science actually helps advertisers at Fortune five hundred
brands measure if their campaigns are appearing next to safe,
suitable content across Metro, Instagram, TikTok, yout Pinterest, We're just
talking about Spotify, linkedins.
Speaker 6 (35:04):
Now, you name it, you measure it.
Speaker 4 (35:06):
And I'm really interested by what ultimately your bread and
buster business been looking like of late. Have brands felt
more secure through your data to come and align the
ads next to those of well use more Metapinterest, Snap
and I like.
Speaker 11 (35:21):
Sure Integral ads Science and thank you for having me.
We're a leading digital media quality company and we focus
on exactly what you're speaking to measurement optimization for over
two thousand brands worldwide. We work with the leading platforms
and publishers and we built a technology back by AI.
(35:42):
It's multimedia classification technology. We're in the live feeds of
all the major social platforms. We are classifying video, image,
audio and text ensuring that the brands are running adjacent
to brand safe and suitable.
Speaker 6 (36:00):
Content and has the date to have been getting better.
Speaker 11 (36:02):
The data is absolutely getting better. Our technology is highly sophisticated.
We're classifying frame by frame and what I mean by that,
if there's let's say a thirty second TikTok video running,
we are classifying every single second of that thirty second
TikTok video to ensure brands aren't running adjacent to unsuitable
(36:26):
content like hate speech, violence, and as we rolled out recently, misinformation.
Speaker 7 (36:33):
Lisa is Pinterest a platform you take seriously in the
context of ads.
Speaker 11 (36:39):
The brands take all of the platforms seriously, including Pinterest,
And as you look at the size of the digital
advertising market space and the fact that advertisers they're pouring
billions and billions of dollars into digital advertising, they want
to ensure that an independent verification company like Integral ad Science,
(37:02):
we are classifying and verifying the quality of the media,
and that we're holding the platforms accountable and responsible again,
ensuring that we're identifying the inappropriate stuff and helping advertisers
run their brands adjacent to more appropriate, brand suitable content.
Speaker 4 (37:23):
And we'll see how those social media companies have benefited
from some of that growing confidence research.
Speaker 6 (37:28):
Snider, we thank you for being hit Intagled ad Science.
Speaker 7 (37:30):
CEO Changpeng cz Jow, the billionaire founder of the Binance
Crypto Exchange is starting his sentencing hearing today on anti
money laundering charges and prosecutors recommending the court give him
(37:50):
three years in prison, double the maximum that guidelines prescribe.
Let's go out to Bluebo's Olga Krief, who has all
the details of what are we expecting.
Speaker 12 (38:00):
So we are expecting the hearing perhaps to last not
very long, in a couple of hours. CZ will probably
speak at the hearing, and his lawyers are pushing for
probation and sort of much you know, less harsh sentence
than what the prosecution has asked for. And of course
(38:22):
you'll recall that in November CZ pled guilty to a
number of charges and he agreed to pay a fifty
million dollar fine, and Binance agreed to a four point
three billion dollar fine, and today we'll find out sort
of what happens to him. He still retains his ownership
(38:44):
of Finance, which has been doing extremely well, especially in
this year's sort of cryptoble market, driven by the introduction
of US Spot bitcoin exchange exchange traded funds.
Speaker 4 (39:02):
Well, Olga Curf, we thank you for really an amazing read.
Speaker 6 (39:05):
It's the big take today, go online, go check it out.
Because it really is about.
Speaker 4 (39:09):
Ultimately the fortune of cz and how that doesn't seem
to be being vented anytime soon, whether he says prison
time or not. Meanwhile, though, there is a whole raft
of other crypto news to be getting into in a
batch of ets. So we're just talking about investing directly
in crypto just debuted over.
Speaker 6 (39:23):
In Hong Kong.
Speaker 4 (39:24):
So is this competition to the US bitcoin products? Is
this going to bring in new investors, particularly.
Speaker 6 (39:29):
Over in Asia?
Speaker 4 (39:30):
Still Mark founder and managing partner and ease Colleen joins us. Now,
look still coin. Still Mark is a bitcoin focus venture
capital firm. We got eighty five million dollars in assets
on a management You've been doing this for a long time,
looking at the protocols, the real use cases of bitcoin.
This is eth and Bitcoin spot ETF. What does this
mean for the industry.
Speaker 13 (39:51):
Well, it's the first time we're seeing the ETF perform
against Bitcoin ETF. And what we saw in Hong Kong's
day one launch was that much of the activity, the
vast majority of the activity was in the Bitcoin ETF.
We saw about just under thirteen million dollars of trading activity,
which is a lot for the Hong Kong market sized
(40:12):
at fifty billion. Issuer China AMC has reported one hundred
and forty one million dollars in assets under management after
day one, and eighty six percent of that is in
the Bitcoin spot ETF.
Speaker 7 (40:25):
At least, Why is it important that we have multiple
markets New York, Hong Kong. We talked the other day
about Australia thinking about its place in this market.
Speaker 1 (40:36):
It's a great question.
Speaker 13 (40:37):
First of all, of course, Bitcoin's price is a product
of adoption and expansion of its utility set. As esetfs
are introduced in new markets and new geographies, we are
advancing adoption. We're bringing a new group of users into
bitcoin through a regulated product, albeit one that relies, of
course on a custodian We're also moving closer to having
(41:01):
a twenty four to seven spot ETF market. Of course,
with the addition of Hong Kong.
Speaker 4 (41:08):
I'm interested in Hong Kong specifically because of his relationship
with China and the regulatory oversight. What does this mean
for China's relationship with crypto, Yes, exactly.
Speaker 13 (41:19):
Many are interested for exactly the same reason now, of course,
in the launch of the Bitcoin and East Spot ETFs
in Hong Kong. People in China do not have access,
so it's a more curtailed audience. Of course, that said,
we are still introducing an entirely new audience, and one
(41:43):
that one that thinks differently, has different has exposure to
different media sources, and we expect that this is a
positive sign for broader proliferation of bitcoin products in Hong
Kong and in the reg and exposed to this product still.
Speaker 7 (42:04):
Mark founder and managing partner Elisa Colleen, we really appreciate
your real time global perspective, and fortunately for our audience,
there's more coverage of those ETFs and the CZ sentencing
at the top of the next hour on Bloomberg Crypto.
The understanding is that in the CZ hearing at least
carow a lot of that will kick off around midday
(42:24):
New York time, which is nine am out here on
the West.
Speaker 4 (42:27):
Pretty perfect if you want to be digesting that in
real time with a crypto show, but we sort of
tease ahead to it, but for now, that's our job
done on this edition of Bloombog Technology.
Speaker 7 (42:36):
Yeah, a really massive after market earning situation that we're
going to be tuned into and tomorrow is going to
be a big discussion on that. The pod on Apple, Spotify.
iHeart the Bloomberg platforms. Thank you to listening to the podcast.
This is Bloomberg Technology.
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