>> live from pier 3 in san francisco, welcome to the late edition of "bloomberg west," where we cover the global technology and media companies that are reshaping our world. every weekend we'll bring you the "best of west," the top interviews with the power players in global technology and media companies that are reshaping our world. let's get straight to the rundown. from luxury tech buses that have been surrounded by protesters, google is trying out a ferry service instead. lieutenant governor gavin newsom weighs in on whether the tech elite are ruining san francisco. the always colorful t-mobile c.e.o., john legere, was kicked

out of an at&t party and now he is trying to steal their customers. we'll hear from the man himself. general motors and audi might seem like unlikely partners for google, but the search giant has teamed up with several automakers to bring its android software to the connected dashboard. first to the lead. google is testing out a ferry service for its employees to bring them from san francisco to headquarters in mountain view. it will stop in red wood city and presumably pick up from there on buses to mountain view.. a google spokesperson said we don't want to cause any inconvenience to san francisco residents and we're trying alternative ways to get googlers to work. some san francisco residents have been protesting the tech shuttles that routinely take employees from san francisco to headquarters in the valley. apple and facebook have the same buses that google does. the city of san francisco agreed with the technology companies

and the shuttle companies that they are going to have to pay to stop on city streets. i spoke with our editor at large, cory johnson and california lieutenant governor gavin newsom about the subject. newsome was elected mayor of san francisco back in 2003. i asked him whether he sees a divide between the tech community here and everybody else? >> not everybody else, but i think it is deja vu all over again, 1997, 1998, 1999, 2000 -- >> only when things are good? >> things are good. the question is, is it situational, meeting short-term success, or is this sustainable, and there is every indication to suggest that this is going to be a longer term curve, and that could change the way of san francisco, so there is a lot of legitimate concern out there and a lot of friction, and it is certain manifested with these buses with some of those protests a few weeks ago. >> these employees do not take public transportation.

they are on these cushy buses down to silicon valley, and also, real estate prices are now sky high. it is impossible to get an apartment around any of those bus stops let alone anywhere in san francisco. how big a problem is the real estate? >> it's a big problem. go back. all the headlines, all of the stress and gentrification, go back to your old articles in 1998 and 1999. it is precisely the same. we were talking about commercial rent control, and there were convictions, and we had emergency supplementals to take care of nonprofits because they were being priced out and they could no longer afford the rents. the question now is going back to that time, and that ended quickly, a boom and bust, and now we are sensing this will continue, so it does require a different kind of motivation, leadership, to get ahead of this.

i thought it was a good thing, the mayor came together with the tech community, apple and others, facebook and others, and they said, look, we agree. we have to address these shuttle buses. >> do you think it is good that they have to pay? >> it is a good thing, because it was important to send the message that they have to play by the same rules as everybody else. they were taking bus space and traditional muni public bus space, and these shuttles were there. if you or were there, we would get a $270 fine. so it seemed appropriate that $1 a day per stop, per use. the tech companies are also providing a service. folks from not in their cars. they are not driving and contributing to congestion and global warming. it is a win, i think, on both sides. >> i want to bring cory into this discussion because he was here during the last bubble. is it ok if it happened then and it is happening now, and are they doing enough? >> i was there during the gold rush too.

i am really old. there are a lot of interesting city planning issues. what happened in 1997, 1998 and 1999. these we are urban companies. dot com companies, and they were not profitable businesses, and now we are talking about yahoo! and google and big profitable businesses that are ferrying city workers to suburban sites, and that is not what was going on before. there is this notion that people who want to live in the city are able to, and there are different kinds of companies affecting change in the city, so i think to gavin's point, this could be a much more permanent thing because they are successful, profitable business where the workers are choosing to live in the city and not in suburbia. >> right. >> that's if there is any big phenomena. silicon valley is moving north. these young folk want to be in a dense, urban environment and

want all of the amenities, and they are willing to sacrifice a commute. that is big vexing issue for these companies. i want to maintain these campuses, but increasingly, folks are saying, can't you open up a satellite office in san francisco? >> and we are seeing companies like twitter and salesforce make their headquarters in san francisco. they are taking up huge corporate office space, and that is not making people happy either. the day twitter went public, there was a huge protest in san francisco and people complained they were getting pushed out of the area and they are revitalizing the city, and in another one, they are being pushed out of the area. people can't afford to stay where they are living. >> it is an age-old story. gentrification. when you invest, prices tend to go up. people are competing for access to that newly improved area, so this is going to be again, a huge challenge for this mayor and the next five to 10 years if we see the kind of sustainability that cory and others believe exists now in

this very substantive move towards global local mobile social class, with real profits opposed to those companies that were built on really nothing except hype. >> we'll have more on this perceived tech divide next on "bloomberg west." ♪

>> welcome back to "bloomberg west." i am emily chang. tech companies are now at the center of recent protests over income inequality in san francisco. as we know, protesters have surrounded tech shuttle buses in the city and on the day of twitter's i.p.o., they surrounded twitter headquarters as well. twitter has been given big tax breaks to stay in the city. what responsibilities do companies like twitter have? jack dorsey recently spoke out

about it saying it is really disappointing. there is a social responsibility that all companies have and we can carry that torch. on the late edition of "bloomberg west," i spoke with cory johnson, gavin newsom, the lieutenant governor who was elected mayor of san francisco back in 2003. i asked him what does it mean carrying a torch? what is twitter's responsibility? >> twitter in particular, because i was mayor at the time we started negotiation. they got a nice x break that encouraged them to locate in the market area of san francisco. they fulfilled their commitment and our expectations have been exceeded because of their success and the area is beginning to truly change for the better. i think the responsibility, obviously comes from tremendous success. there is no one better, by the way in this city than the marc benioff founder of

saleforce.com. he gets this better than anyone. it is right to celebrate all the success of the companies and the tax benefits. >> is it fair to get all of those tax benefits? >> i think it was the right thing for the city to do at the time and i think it has paid great dividends. that said, guys like marc didn't necessarily seek it out. twitter got the benefit and others are getting the benefit but he gets it in this context. a lot of the tech people i talked to said we're creating jobs. what more do you want from us? guys like benioff understand we need to step up in a much bigger way and a more pronounced way. there are real conversations. trust me. some conversations with these leaders that have made fortunes and understand their responsibility to the community in a much deeper way than just creating a job. >> what about companies like facebook, apple, cory, google as well, that are not based in san francisco but make it easy for employees to live here and commute down there? >> i think one of the issues here and it touches on all sorts of things and it is not just a

san francisco issue. but this issue of income inequality in this country, the rich being so much richer than the poorest people, creates economic risk and you see it not just in people protesting in buses. when the growth part of our economy, when the spending of our economy is only happening by the richest people, and that could be so disrupted by a stock market crash or a slowdown in all of this tech growth, it could be the beginning or end of that stock market crash. it creates greater risk to the economy. one of the reasons we had a great depression after a stock market crash in 1929, we had a lot of income inequality until the big spending was not happening in the farms and with poor people but it happened with rich people taking their stock market gains and spending them. that is one of the risks with income inequality. we can see that visually in this bus story, but san francisco, that is one of the big differences from 1999 is this income inequality we have in that city and so many others in

the country. >> it is much more widespread. >> as a business owner, i have close to 1,000 employees. one thing i know as a business owner, businesses can't thrive in a world that is failing. at the end of the day, we are in this together. i think you just hit it on the head. if the stock market drops down and the fed changes their chief money policies that are moving the markets and put people in equities, all of a sudden the pace of this can change and we won't have the ability to come out of it in a really meaningful and sustainable way. i don't want to say it is code red, because that is typical political hyperbole, but we're getting to a point, and these are just symbolic flashpoints, these google ferries and the buses, etc. we're at a point where people are going to have to step up to the plate in a non-ideological way and address this issue. >> what do you think of the ferries? >> i love the ferries. it is an old idea. i remember talking to the founders of google literally a

decade ago. they were talking about some form of ferries. this is a long time in a works. this didn't just happen in response -- >> but the consequence of this is there is not good public transportation down there. i don't work for google. if i want to get down to silicon valley via public transport, that is very difficult. it would take forever. >> there are two complaints, as a former mayor. homelessness and how lousy the public transportation system is. >> number three, school. >> by the way, you're absolutely right. the challenge is we do provide an extraordinary world class public transportation within the city. we actually move every single day about the equivalent of the population of san francisco. it works well despite the fact that it can be better. that said, it doesn't go down to silicon valley. that's where it stops. we have a bay area rapid transit system. we had a big strike people may have heard, a few months back. it doesn't necessarily have that direction down into san jose. that is being worked on. we got it to the airport. bart to san jose is now being worked on. that's why we have limited transportation.

that is why these buses are necessary. why not take advantage of mother nature's -- >> maybe google can fund more public transport. >> they are funding for their employees the shuttles. they're getting people off the roads and out of cars and now providing an additional service with ferries, i think is a very healthy thing and before you know it, sergey will come out with a new way to bring people down. >> our editor at large, cory johnson and lieutenant governor gavin newsom. coming up, google has teamed up with carmakers focused on bringing android to your dashboard. we'll have more on that next. ♪

>> welcome back to "bloomberg west." i'm emily chang. self-driving cars are not a thing of the future. they are here. audi showed off a self-driving car at the consumer electronics show in las vegas. it cannot only drive itself, it

can park itself. bloomberg's sam grobart took a spin. >> the car of the future isn't something that is coming. it is already here. cars are already beginning to take on more and more responsibilities that drivers used to do, and i'm here at the audi booth outside of ces to see what they are doing to combine all of these sensors and functions into new semi- driverless vehicles. audi is showing different technologies here in las vegas, including cars that can effectively drive themselves through highway traffic. >> so we're in traffic now and the car is monitoring the vehicles around it. it is monitoring the lane markings and the road boundaries and is basically following traffic like a human driver would. >> you haven't been touching the steering wheel this whole time, have you, bjorn? >> no, the car is driving it. the driver can relax and do something else. he doesn't have to watch the car doing its job.

>> audi is showing cars that monitor your alertness and stop the car if you fall asleep and cars that can park themselves without you behind the wheel. >> did you just see that? >> he got out of the car, pulled out a smart phone. pushed a button. the car put itself in the parking spot, no dings, no dents, no scratches, no nothing. you have computer-controlled steering, acceleration and braking. you have sensors mounted all around the car so it knows when to turn, when to straighten up, when to speed up and when to slow down. >> so bjorn, when will a car that can drive itself through traffic be something that we see available to us? >> we're going to make this technology available in the next five years and as you have seen, the technology is ready. the thing that is keeping us is legislation in most parts of the world. >> automakers love to talk about the joy of driving. the fact of the matter is

probably more than half of the time there is not a lot of joy, parking cars, sitting in traffic. that is not something you want to actively be participating in. these technologies remove that basically from your responsibility. >> that was bloomberg "businessweek's" sam grobart. google's self-driving car may not be on the road yet but they are helping to push connected cars into the fast lane having just announced the open automotive alliance with g.m, honda, hyundai and audi. the goal in partnering with car makers is to get a customized version of android software into cars for infotainment and entertainment. for more, i sat down with mark mahaney, who covers google for r.b.c. capital. >> they already are your online utility and probably the one single thing that you could not live without on the internet. you think about all the information that you need, the number of times you use any of the entertainment applications they offer you. now they are trying to take that

utility-esque feature of google and take it off of the computers and put it on your glasses and put it on your car where you spend all of your time. you can't do searches where you have your desktop with you or your mobile phone with you, but you have your car with you. yes, now you can. it is integrated into part of the car. that is part of the information they are trying to build around maps. they may not be able to monetize usage of map but indirectly they do, because if you you're using google finding out how to get from point a to point b, you'll use them for other functions. >> i was talking to -- in so many words he said all of this stuff -- it doesn't matter because it is not apple. and, you know, apple i.o.s. does have some integration with cars at this point. what is your take on that when it comes to google vs. apple? and the car, which is an as yet unclaimed territory when i know the comes to technology. >> the big missing rink in wearable devices and integrated cars i think is voice recognition, and i think it is pretty clear that the company with the best voice recognition,

voice context technology in the market is not apple. it is google. so i would take some exception to the comments. i think that is the link that people are missing. the google glass -- think about it in three years from now, the ability to interact with the device. it will be in your car via a very good voice command. by the way, it will be tailored to just your voice. not to anybody's voice. that's the secret sauce behind wearable devices and integrated cars. >> what are the means for samsung? this is a company that relies heavily on google's android operating system. this week it seems like they are focused on the connected home and not the connected car. is that a mistake? >> i don't know. this internet of things, this internet of people, we want to be connected with all the things that internet offers us. internet saves us time. i don't know why samsung wouldn't be part of this ecosystem. in that kind of environment where the internet connection matters more than anything else, the importance of the devices

kind of falls a little bit. still devices are going to become commoditized. >> when will we see the cars on the road? >> i saw a photo of you in one. >> that was a few years ago. >> my understanding is they have already done over 100,000 miles of driverless driving in two states, nevada and california. i don't know. it is very hard to know. it is one of those off things. it is one of those experiments that google does. i'm not sure they have thought through it. that is ok. if it becomes a utility, they will find a way to monetize it. >> my interview with mark mahaney of rbc capital. coming up, t-mobile's c.e.o. john legere sits down with us. this interview may be more shocking than ever. that's next. ♪

>> welcome back to "bloomberg west." t-mobile ceo john legere got kicked out of the at&t party at ces earlier this week but he may well have the last laugh. t-mobile announced it had the best quarter in eight years. they will now cover early termination fees to get customers to switch from other carriers. it is showing big subscriber growth. jon erlichman sat down with john legere at ces earlier this week. >> there are three parts to what we see. i announced ahead of schedule q4 subscriber numbers and the surprise was 1.64 million net adds making the year total for t-mobile 4.4 million. post paid net, 869,000 so the growth is one.

-- is grown. the revolution continues. number two, i announced a fun one -- we have the fastest 4g network in the united states by speed test.net. crowdsource results as of today. the cease and desist letter is going out to at&t to rip those billboards down and those poor kids will be unemployed. those two things are important because now the answer is, why would you not switch to t- mobile? the answer is early termination fees. this isn't a program. we are eliminating forever early termination fees and moving the industry to no-contracts completely. what it can mean, a survey was done last week -- 40% of families say they would consider t-mobile if they did not have an etf, 70% of customers said they

they -- 78% of customers said they would consider moving to t- mobile if they could get their termination fees paid. i don't think 70% will come but it's a revolution. >> the numbers have been very impressive for t-mobile since you launched this uncarrier plan. you have been adding a lot of customers. you mention at&t -- at&t.last week, ahead of ces, at&t -- i have to talk abut at&t. last week, ahead of ces, they made their own announcement specifically on the contract side, perhaps not that different. what are the differences? >> unlike my normal behavior, this is for everyone. this is verizon, sprint, and at&t and i enjoy things that cause pain to at&t. they came out with an offer -- >> you called it desperate. >> totally desperate, why would anybody move to a carrier to take a limited plan and go to the next upgrade program that nobody wants for $200? here's what i suggest -- i announced, thank you, at&t -- i

suggest that everybody consider our offer and if it doesn't work out, at&t will pay you to go over there. it's not competitive. our program is cash. 5 lines up to $650 per line, and it is cash paid for your etf. >> you have done a lot of things over the last year or so. this is an important thing. you have international roaming. which was a big move some wonder how far it you will go in terms of this potential price war. are we in a price war? where are we going from here? >> i'm pretty sure nobody has a question as to how far i will go. we could jump to 3.6 million customers. international roaming is up 10 fold. this is considered a price war to the people with 55% ibita

ebitda margins. you will see my commitment to profitable growth, i am reinforcing and pushing forward. >> what happens next with t- mobile? will you be acquired? there are rumors that softbank is working on something right now. what do you say to that? >> i will give you the standard, i'm sorry, but as a ceo i cannot comment on it. here's something to think about, though. over the past 10 years, almost all consolidation in the industry was done for somebody to acquire spectrum. all of the people rumored to like t-mobile right now, all they have is spectrum. they don't have a business. with t-mobile, this movement, this revolution, this trend will continue. whether we do it alone or we do it in a consolidation, we will be at the forefront of what happens. >> let's talk about the headlines this week. party crashing, kicked out of an

at&t party? set the record straight. >> the life of a rockstar. for the record, i love macklemore and i wanted to see them play. i was surrounded by a sea of humanity escorted me out. i'm sure i would've done something different. >> it was not a stunt? >> no, but i was prominently displayed in the new york post next to kim kardashian's selfie. i have arrived. i am ready. >> what about profitability? we continue to see your aggressive moves and others in the industry are making aggressive moves. what will that mean in terms of how profitable this business can be? >> these folks are happy. one thing i quietly did this year is take $1.5 billion out of the cost structure.

i am not having a macklemore party. you won't see suites at the super bowl. these guys cannot compete. they have to make some changes. with these plans, i can very profitably grow. that's all i can speak to. >> in terms of ultimately how many people you could bring aboard with all the announcements today -- that was my first question -- any idea how many new customers you think this could bring to t-mobile? >> put it this way, originally, when i came over, the plan was hopefully to be slightly negative in the postpaid but incrementally positive the next year and then i give guidance of 1.2 million and raised it 1.4, 1.6, 1.8 and we saw 2 million. so we are seeing accelerated growth. i will give guidance on the business in february. the momentum continues and the ratios with the seven days ended

january 1. at&t, 2.4 to 1 - spring, 3.6 to 1, verizon -- we are moving. >> jon erlichman with john legere. have you wanted to record eight shows at the same time? maybe you will need to at some point. dish is making that possible with a new dvr offering at ces and we will talk to the ceo coming up. ♪ >> welcome back to "bloomberg

west." binge watchers rejoice. dish reveals the new hopper dvr line. you can record up to eight shows. and watch 4 simultaneously. dish announced hopper integration with sony playstations and lg tv sets.

jon erlichmann spoke with joe clayton. >> what we are doing is using technology to better improve the experience for the consumer. let me give you a couple of examples -- our new super joey product allows you to record up to 8 programs at one time. if you have a multiple tv household, like i do with five kids, there is never enough capacity to record all the shows. that all the family members want. we have something called a wireless joey. you are limited where you can put your tv if you don't have coaxial cable. this is a wireless joey, plug it in and it will work anywhere. last, but not least, we have something we believe makes eliminates clutter in the home where instead of having a separate box, you can hook it up to a sony playstation or an lg smart tv. we are trying to make the

experience easier for consumers. that's the bottom line. >> it has been clear that you embrace technology and you have used those words yourself before. yet the broadcasters sometimes get frustrated at where their content is going via this new technology and it has resulted in legal battles. is this the kind of stuff you guys can settle as friends? >> you would think we are against advertising. we do half a billion dollars in advertising per year. what does the consumer want and how do we better use technology to target the consumer and give them the messages that are important? that is what we are trying to do. >> are there any hard numbers you can share with us tied to dish on implementing these things that has has tangibly resulted in x amount of new customers? >> it's probably too new to have statistics but we know addressable advertising is more efficient.

ultimately, that's what the advertiser wants, to spend his money as effectively as possible. that's the message we are trying to get across. >> you spend your days working on all sorts of partnerships to allow for some of the technology to be used, deals with content providers so that you can have their content available through dish. disney is one of your longtime partners and many are wondering when you two might reach a new content deal. can you give us an update on that? >> all i can tell you is that discussions are ongoing. we are talking about the future of television and it's over multiple years. it will take time. i think we will end up with something that is mutually beneficial for the disney corporation and for dish and the consumer. >> there is the tv side and there is the constant questioning about the wireless strategy for dish.

let me ask about t-mobile. do you want to buy t-mobile? >> as a technology company, we look at all technologies and all our options. there are multiple possibilities for us to get into the wireless space. that could be one. there are many others. right now, we are focused on trying to acquire spectrum which really gives you the purview or the way to get into the wireless space. spectrums like oil, gas, water, gold, you cannot get enough. we are in the process of accumulating spectrum and we believe that will give us the foray into the wireless space. >> john legere gets a lot of headlines for his strategy, what do you think about what he has been able to do over the last year at t-mobile? >> i used to work with john. i do know him. i think he has done a nice job

of changing the consumer offer in the wireless space. i give him a lot of kudos >> last year, i asked you whether we would see some type of deal between dish and directv. a question you've probably been asked 3,000 times. i think it's important to ask even the question of how long are people going to be interested in staying with a video service if customers decide to go elsewhere. is there a benefit of your two companies coming together? >> it's another option just like t-mobile. there would be some synergies putting both companies together. quite honestly, you are still in a saturated and mature market even with direct tv and dish. wireless is a growth market and that's our primary objective going forward. >> earlier today, we spoke with the ceo of aereo who has been doing boxing with broadcasters.

what about the idea of having your own aereo-type service? >> we also box with broadcasters. it comes back to the technology. we follow all types of logical developments closely. if this can give us a lower cost that we can pass onto the consumer, of course it would be an option. there is a lot of water that has to go over the dam on that. the court still has to rule. it is still more speculation than anything else at this point in time. >> what about a hulu-type service? is that something dish would be interested in? >> you mean the one that does not have as many commercials? once again, we would be interested in taking a look at that. anything that can improve the experience for our customers and potential customers.

>> joe clayton. ces may be about the newest gadgets but are they really that different? jon erlichman broke out some old gadgets to see how people might react. it's an interesting science experiment and that is next. ♪

>> welcome back to "bloomberg west." ces attendees are there to see the newest and coolest gadgets but can they tell the difference? you will love this experiment. jon erlichman hit the streets with some old stuff to see if people really could tell the difference. >> ah yes, the consumer electronic show where there is technology exciting and new, or is it? we decided to show people old stuff and see if they knew the difference.

this is a k-44 stereo headphone. they have dual stabilization for comfort. >> they are very light but they are a little bulky. >> this is the eee pc from asus, like a pc or a phone. >> it is lightweight. >> it's kind of heavy. >> would you give up your smartphone for it? >> i don't know about that. >> in theory, this is supposed to be an energy efficient band across the stop like a light sensor. >> i want to go fishing in them and see directly through the water. >> how does it fit on your face? >> you notice the difference. they seem like regular sunglasses. >> this is kind of random, this is a metronome.

>> i'm used to seeing the one with the -- it's quite cool. >> garmin gps, do you guys use gps? >> if we do, it's on our phone. >> this is kind of heavier, is that all right? first impression of this apple watch? would you pay top dollar for something like that? >> yes. can i connect it to my mobile device? >> i have wanted one of these for a while. >> that's pretty cool. >> this is not an iwatch? >> no. >> he's smart.

>> delta picked the surface tablet for its pilots and we will talk about why and get on board next. ♪

>> welcome back to "bloomberg west." more and more airlines are putting tablets in the cockpit. this means they don't have to carry heavy flight bags filled with maps and documents. they can save fuel, too. american and other airlines are using ipads. delta went in another direction and chose the microsoft surface. olivia sterns hit the flight deck to find out why. >> for 30 years, this captain has been lugging a 38 pound brief case. inside, charts, maps, operation manuals -- all the essentials for every flight.

now, a tablet that weighs barely two pounds is about to lighten her load. >> i think the tablet is one of the biggest steps right now. it will make everybody's life easier. >> here is the catch -- other airlines started using ipads in the cockpit, delta chose the microsoft surface. that's right -- the surface. are you surprised you did not get ipads? >> when you see this thing, it is sleek and has a gorgeous display, you can split the screen, it is lightweight. >> delta plans to rollout the tablets to all its pilots which is years behind other airlines but still a major shift estimated to save $13 million worth of fuel cost each year. how much do you use the papers each flight? >> all the time, now i don't have to have them all over the place. it will not block my view. i've got it right here. >> the surface is a piece of

technology and that means there could always be a risk. >> technology overall has been a huge safety improvement. but there are times when this new technology could create safety issues. >> do you think we will be less safe when you make the switch to the tablet? >> i don't. it's just like flying, there's not just one pilot, there are two. some of the routes i am on, there are four. if my tablet device failed, i've got three more. >> at the end of the day, you know how to fly the plane manually. >> absolutely, if all the technology went, we will just use our piloting skills and get this bird down safe. >> remember, you can get all the latest headlines at the top of the hour on bloomberg radio and all the time at bloomberg.com/technology. ♪

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>> the following is a paid program. this company is not affiliated with the u.s. government or the u.s. mint. the markets for coins are unregulated. buying carries some risks. facility,arded fault this is an important announcement regarding a new release of u.s. government legal tender silver coins. behind me is a place few people ever get a chance to see