but live from pier three in san francisco, welcome to the early edition of "bloomberg west." i'm emily chang. our focus is on innovation, technology, and the future of business. we have an excuse is interview you do not want to miss. microsoft chairman bill gates mikeng down with bloomberg, former mayor of new york. they cover a wide range of subjects from how they are using their wealth to change the world to the better, to what future

won't bill gates may play in microsoft. you don't want to miss it, coming up later this hour here on "bloomberg west." how much room is therefore a social search startup. search enginee answers your questions with the help of pictures. it has been available for about two weeks now. thank you so much for joining us. you could have done anything. why this? accident.i did it by i did not mean to do this. my friend and i were going on a walk and we accidentally asked ourselves the question, what would be billed if we had to build something that can answer any question -- what would we build if we had to build something that could answer any

question? and suddenly we had this idea that we had to do. and the other part of the answer is that once i realized what it was, i realized that jelly was a own personality. i really enjoy helping people. getas something i could not out of my head. >> did you mean to start a company? >> not really. we were going to put it out there and see if people liked it, but as we started talking more and more about it, we thought, this could be a really good all-around business. >> it has been out there for two weeks now. what kinds of questions are people asking? how is it going? >> it is still early, so they will be -- it is different than what they will be asking over the long haul. but the three types of questions we are seeing right now are, one, should i buy this? should i choose this one? whatever the pictures are. number two, how do i fix this or set this up? i am confused. and number three, what is this?

what am i looking at? picturehat is where the comes in, because you have to post a photo to ask a question. why is that? some questions need photos and some do not necessarily. >> is is a mobile only application right now. it is very native to the mobile world. one of the things that makes mobile what it is our photos. without the photographs, a mobile phone is really just a little computer, something that tells you where you are out in the world. most questionse, can be dramatically contextualized better with a photo. sure, you can argue that some do not need them, but since most of them, i think, can be enhanced with a photo, i decided to make it mandatory, so you would not have to have that extra decision. you have to use a photo, not decide whether or not you need one. >> let's talk about what else is out there.

obviously, google. what is missing from google? why are you trying to take them on? >> i'm not necessarily trying to take them on. i'm just trying to offer an alternative. there are some inquiries that are better answered by a human mind than retrieving and document that has already been published. is -- albert einstein said famously that information is not knowledge. information is just an ingredient. it is one of many things that gets transmuted in the human mind into actual applicable experience. when you ask a person a question, you just get so much so much morend knowledge. >> i have been doing it a bit here and there. i traveled last week. i broke my carry-on luggage and i asked, well, what should i buy? and right away, i got 15 different answers and they were all super helpful. it worked out really well for me.

>> oh, good. >> one of the things that surprised me when i asked my question, my husband said, are you shopping? because he got a question -- a notification that i wear asking this question. how many people got a notification about me asking a question? >> not everybody. been joking that this is single rank. we are taking all of your social networks, right now, just twitter and facebook, and blending them together into one network and sending your query out to a percentage of those people. not everybody, but some of the people you know got that question. >> what about, though, the questions that you do not want people to know you are asking? that is what makes google so great, that you can just be anonymous and ask these things that you do not want anyone else to know. >> right, that was a decision we made early on. we seldom was better if you were not anonymous. in looking at other anonymous

services, there were too many mean things that are possible. when you attach your name to something, then you behave a little from a. -- a little differently. >> interesting, but does not inhibit the potential gross? >> it might. but if you are not comfortable asking the questions, then it is probably not the right service. >> another thing i noticed, you can say thanks. but i actually wanted to ask these people more questions. do you like that bag e tell me more. how long have you used it? is there a reason you do not want this to be a messaging platform? intentionallye broken a lot of accepted norms right now. thatd an early prototype was very discussion based, a lot of comments and back and forth. we found that people were not in their questions answered quickly enough or in a valuable enough way. we switched to this model where

we said, here's the question and you can either answer it or dismiss it or forward it to someone who might know. we are actively discouraging conversation, because we feel like there are plenty of other places to have that conversation. that might change in the future, but right now, that is the way we are doing it. >> and you make the point of saying it is not a social network. >> right. >> why? >> we do not think that people need another social network. the simplicity of jelly is that it takes advantage of what we have been building for the past seven to 10 years. people have been collecting followers, collecting friends, collecting contacts. it is kind of like, to what end? a response to that. maybe the answer to why we have been doing that is so that we can all start helping each other. >> why can't you search other people's questions? i could have gone out there and said, i wonder what other people have said about the luggage. >> like an information retrieval

across jelly's information. >> right. >> that may come later, but right now it is so early we do not have that much information to look through. down the line, we will probably build up a huge corpus of questions and answers and we may want to start searching across that, but it is early days. vp atr clo is a former twitter and is focused on partnerships. i.e. thinking about potential partnerships down the line? how do you turn this into -- are you thinking about potential partnerships down the line? had you turn this into a research business? there's a lot of opportunity. it has been proven that is a good business to be in. get -- itwant to sounds strange to anyone in the this world, but it is kind of cart before the horse when you are dealing with this business. you need to build up the base and prove that there is value before you can really begin to

think about how you want to offer more value in the form of revenue generating product. off.e holding we think there's a lot of opportunity in the search space, mainly because there is intent. when someone comes to jelly, they want something. and there is usually someone else who wants to get their attention. more after this quick break right here on "bloomberg west." also, the conversation with microsoft chairman bill gates and bloomberg lp founder mike bloomberg. ♪

>> welcome back. i'm emily chang. making waves in the search business with the new mobile app , jelly. but it is not his first app. he helped to launch twitter in 2006 and since then, twitter has raised more than $1 billion in an ipo how did the cofounder shape twitter's success? i want to talk more about jelly for a second. when i downloaded it, it was like 30 -- 35 on the list. when it comes to growth, how are you going to use some of the things that you learned at twitter to help jelly grow? it is funny to say this in that it is only a few years later, but we are living in such a different world now.

in three days, jelly had more -- twice the accounts that it took me a year to get at twitter. it is because of things like facebook that spread the word so quickly. >> how do you keep the growth like this? >> well, you don't. when we launched and we got featured in the apple app store, it was crazy. i reminded everyone on the team it will go like this. be prepared for that. don't think it is failure. is you you have to do it have to build a system that has growth mechanisms in it and you have to trust that those will work. you don't want anything artificial. >> anything you will not do with jelly that you did at twitter? any mistakes that you learned from? to gol, we are not going down all the time. although, it would be an

appropriate image. but again, it is a different world. we are able to use amazon services to host everything. we can spin up a new server in seconds. back in the early days of twitter it was a lot of work. >> put your is now a public company. how is life different for you -- twitter is now a public company. how is life different for you? is it at all different? >> not really. i would say i have some notoriety. i have the ability to get my phone calls answered or to make a big deal when i launch in you have, and that certainly helps. >> right. uptter going public dredged a lot of stories about the founding, a lot of drama. nicholson wrote a book about it. and -- nick holt wrote a book about it. twitter'sort of like moral compass, the glue that kept twitter together.

how fair was his portrayal? he did, i think it was hundreds of hours of interviews. i think he was fairly thorough in his interviews. fair -- he had to make someone a bad guy and he had to make someone the fall guy and he had to make some of the good guy, right? because it is more exciting that way. in that capacity, i think there was a little too much sharpness. was stuff ihere learned that i did not know. >> like what? >> i didn't read the whole thing. >> you haven't read the whole thing yet? >> i am too scatterbrained to read it from cover to cover. i just looked at my section and a couple of other things. there were meetings that were taking -- that were taken that i part of,ow and was in etc. >> looking at twitter today,

there is a history of a revolving door. of thefident are you people leaving twitter now? >> i'm very confident in them. we picked them. what i have always said, and i think this is true, is that twitter needed to it needed at the time that it needed them. , peoplet evolved switched roles. no matter how dramatic it was, people switched roles and they were in the right role. i mean, look at where the company has come today. i think that is a testament to that. >> michael sippy as head of products just left. it set off some alarm bells because of twitters past. some people are saying that maybe they are going shy about launching new products and it's difficult to get product out the door. how do you see twitters ability to in -- to innovate in the future? are some things that are

different. >> this is something every company faces once they go public. ok, we have to make dramatic, innovative moves on the product side, but we have to be careful because now we have shareholders. and i think the shareholders and whatone understands twitter is as a company in that ecosystem, in that they have to make old product maneuvers and changes. and i think they will. >> speaking of shareholders, a lot of questions about when twitter will turn a profit. do those things concern you? >> no, i don't have to be concerned about those things. it is one of the reasons why we put date in a position, so he could worry about those things. >> it is his job. your first time as ceo, right? >> yes. >> how is that? >> it is great. i love it. the fact that kevin had my back, that made all the difference. >> as is the former vice president on twitter, who i

mentioned. >> yes. you talked before about how he did not intend to make this a company. i was telling heaven, one of my trusted advisors, about the idea. and he just said, i'm in. i was just telling him about the idea. was saying, what is jelly? i'm in. >> what is your ceo style? is there someone you look up to our admire? >> it sounds cheesy to say this, but i look up to evan and jack and. dick. my main thing as a leader is to be as communicative as possible. 75% -- i think that is 50% or 75% of the job of

ceo, to make sure you know everything you need to know. jelly the going to jelly accor >> we have to earn the verb status. >> thank you for joining us today on bloomberg west. coming up, that conversation with bloomberg lp founder mike bloomberg and microsoft founder bill gates. we asked whether he would go back to microsoft and what his future plans really are. ♪

>> this is the early edition of "bloomberg west" and i'm emily chang. intel is giving him his plan -- giving up on its plan to revolutionize the way we watch tv. but verizon is taking over intel's startup. what is verizon seeing that intel is not? jon erlichman joins us. opportunitya huge for verizon. if you look across the country, verizon could potentially rollout tv service. some people are familiar with its files offering. it can beat with -- it competes charter and and

satellite. there is plenty of usa for verizon files to be available in. throughy have acquired intel is a simpler technology to roll out. if you are talking about paid television through the internet as opposed to a big dig, the infrastructure costs that you generally see with rolling out into the new markets, the regulatory hurdles, all of that stuff to a certain extent goes away by buying something like this. you can talk about the cool technology behind this at a time when we are wondering if apple tv will come out with its own service. >> that is what verizon sees, but why did intel give up on this? it was a pretty big investment to start and then they said, you know, nevermind. >> it is a great case study. we have seen a willingness over intel's history a willingness to start interesting projects to tell the story of intel and what it can power. but you have a new leader, someone who was not there from

the beginning of this project, who looked at the bill required andoll the service out said, hold on, is this our core competency? is this what we should be focusing on? or should we focus on getting our chips into the places and devices in the areas where people are using them in a big way? jon erlichman, thank you. we will see what verizon does with it. it is time for on the markets. york, i miss new you already. come back. we are seeing a pretty mixed day. the s&p is pretty much flat. at grey wolf is looking for a closing of 1842 on the s&p to confirm any rally that we have been seeing. though, delta

airlines. shares are at an all-time high. increased holiday travel and higher fares helped its fourth- quarter profits. the markets again in 30 minutes. more "bloomberg west" is next. ♪

>> this is the early edition of "bloomberg west" and i'm emily chang. now to your top headlines. a still -- a snowstorm has hit the east coast, causing plenty of travel delays. delays are currently at about an hour as the new york area could see as much as a foot of snow. -- and in boston and washington, governor meant -- government offices are closed. edward snowden is appealing to the local russian government for protection after getting death threats. he received temporary asylum in russia last year after

disclosing the nsa surveillance program. and thousands of antigovernment protesters are back on the street of the ukraine capital. they are defying the laws that set limits on the right to protest. dozens have been injured in violence in the past few days. in the meantime, the opposition leader says the ukraine's president canceled a planned meeting with him. gates is an entrepreneur, a tech visionary, and a global philanthropist. now the world's richest person wants to admit buster to that list. gates wants to destroy the myth that poverty and disease cannot be eradicated. the bill and linda gates foundation came out with its annual letter today. in it he wrote that by 2025 there will be almost no poor nations left in the world. we sat down with bill gates and former new york city mayor mike bloomberg.

he asked about people's perceptions on smoking, obesity, and marijuana have changed, and rolls and that our. >> cities are where you pick up the garbage, bring down crime, enact health measures and what you can actually see, what you can buy, how you are late -- how it is labeled, and what you can use and those kind of things. if you look at most of the progress made in climate change, for tebow, that has been done at the city level. even in this country, fighting guns, fighting obesity, bringing down crime, those are not at the federal level or state level, but at the city level. >> i have always wanted to know this from you, bill. you have -- both of you have a huge arsenal of resources. how do you pick the causes you get behind? equityally, i think in

childrenty is how poor do not get to reach their potential. they die or they do not have enough food to help their brain to develop. most of the money will go to that cause. fortunately, there are things like new vaccines that will help those kids avoid getting sick. we are seeing the progress. five percent of kids now die before the age of five. the production is that we can get that down to 1.6%. and match where the united states was in 1980. because it is this injustice, because a lot of these things were not being done at the level pick anuld be, once you area, you develop expertise and go out and see people. that will be our lifetime work. >> did someone trigger you to think about this area? was it something that lifelong

you were thinking of? >> i think he listens to his wife. melinda has a lot of good ideas. we have been doing a number of things under her guidance and to try to advance the causes of getting the kids so that they can get born and survived the first couple of days, and then annex five years. there are many good ideas. you have to look and you cannot do everything. you have to decide what your core competencies are come away you want to do it internally. and like the bill and linda gates foundation, in many cases they administer funds and in other cases they give funds. we probably donate funds rather than have others administrate. but we handle a lot of things internally as well. >> when you were mayor, you could measure the success of your own projects and initiatives. and you give money, how do you measure success? >> number one, not everything will work quickly. you have to have patience. if you do something

in the scientific world and it turns out to be a failure, that in some sense is a success, because you don't have to go down that path again. unfortunately, in the world you are labeled a failure and it was a waste of your money. that is not the case the way science works. knowing what you are doing, measuring it, and there are many people around that are trying to apply metrics. in some cases, you can. in some cases you have to do it on faith. i know down the road this will help and i'm willing to make that bet. then wait a little while and give it the old college try. if it doesn't work, don't be stubborn, but don't walk away from it too quickly either. >> how about you, bill? >> each project has got to have a commitment, like our smoking groups come in and talk about how we will have the prevalence found. mike's group has led the way on that. it is going very well. in science, we back a lot of different scientists. even if one approach fails, if

it is an important problem, then we have three or four in the portfolio approach. you have,ccesses that with mike where we have new seeds where the farming activity has doubled, that gives you -- like where we have new sees where the farming activities has images, that gives you to keep trying. >> more on the interview with mike bloomberg and bill gates next. will bill gates return to site -- return to microsoft full- time? ♪

>> this is the early edition of "bloomberg west" and i'm emily chang. we had a fascinating discussion right here on bloomberg television between bill gates, founder and chair of microsoft, and mike bloomberg, the founder of this company, bloomberg lp, and the former mayor of new york. a big question, of course, what

is the future of microsoft? who will be the ceo? and how involved is bill gates still in the day to day activities at microsoft? >> well, i'm on the board, and doing some important work right now. the foundation is the biggest part of my time but then i put art-time work in and help as board member. >> are you involved at all -- or how involved are you with the chief executive? it is a good board. >> does the board feel a sense of urgency on this front? >> you want to pick the pests -- best person. they will move at the right pace. >> we have the fortune of having

the mayor comeback to this company. this company,o and we are very happy to have him. in your ever been vision, ever going back to microsoft full-time? >> my foundation will be full- time for the rest of my life. my wife and i are enjoying that. i will not change that. i will help out part-time. you have 12 years that been in public office, technology, the industry itself has changed dramatically. new pioneers that are following in the footsteps of bill gates. give me your take on the state of technology. >> technology is an enabler and a tool, but i think the basics really have not changed. education, business, philanthropy -- it is still about looking in each other's eyes and listening to each other and working collaboratively.

do not think that technology is going to do everything for you. ethics matter. competency, the education of our kids is the most important thing. there are enormous changes in the job prospects of people at every level. some will lead us down the path to some very severe problem. but nevertheless, here is the most important thing, every kid getting a good education. and some of parts of the world they understand that and some parts of the world they don't. notsadly in america, we do seem to. we keep falling in the rankings. we used to be in the top 10 and now we are lucky to be in the top 30. that does not bode well for our future. we have to get away from this partisan stuff and start devoting the resources we need to have a future. >> you are passionate about training our young people, particularly in computer science. there is not enough training there. >> yes, i think education is top.

mike and i think it is very important. help teachers be better. let's try out new approaches. the status quo is pretty unsatisfactory. technology is going to help, particularly for that motivated learner. but how you create the bro -- the motivation broadly, that is andly a human problem, helping the teacher do it as best as possible. >> on a final note, bill, tell me what you think about the state of the technology industry now, and the new crop of leaders, how you see them. >> the rate of innovation is faster than ever. things like understating speech and vision, taking in large amounts of data and understanding that, big, high resolution screens that will be on your walls and in the office. where in a fantastic time finding information and understanding information is

going to get a lot better, and that will lead to productivity. so thatimulate things new product design and innovation can grow faster. we see it in biology. we understand complex systems and what drugs should be tried out. believer that whether it is helping the poorest, or just helping the , technology can solve a lot of problems. >> just go back and look at what years predicted a few ago and they were so wrong. almost everything that was protected has been done and in the next few years we will improve technology more than was done from the beginning of inventing electricity to today. >> exponential. >> exponential, and disruptive. there is no industry that will not have to adjust and change. some will do it successfully, some won't. some people will have better drugs. some people have to find ways that they are -- find ways to

make sure they are included. we should not walk away from it. and it is not just an american problem, but around the world. and particularly in the middle where a lot of automation is taking place. it gives you cheaper, better products, but also employs fewer people. we have to find ways to get everybody involved. >> mike bloomberg, founder of this company, bloomberg lp, with microsoft chairman and founder, bill gates, right here on bloomberg television. if you missed any of the conversation, you can check it out on our website bloomberg.com or our tv app. up, in china, some already have -- in china, social messaging, some already have fast reduction rates than facebook. ♪

>> welcome back. i'm emily chang. lenovo is in talks to buy ibm's low-end server business, says a

person with direct knowledge of what is going on. a deal may be signed within weeks. the estimates of assets are worth anywhere from $2.5 billion to $4.5 billion. the focus will be software and services. we turned now to a messaging app that has exploded in the last couple of years. it has now racked up 430 million active users. joining us now is someone who knows a lot about the rising , bertrand smith, the ceo. what exactly does whatsapp do? >> we provide marketing agents for all of these different companies. they use us to better understand

the source. >> what is it about whatsapp? why has it gone from zero to 400 and 30 million so quickly e -- 430 million so quickly echoed >> it is better technology. now that we have smart phones and we are on three g, we can do so much better. we can do messages, videos, pictures, and exchange with your friends. >> and you are based in beijing? .> we have a base in beijing >> how is it doing in china? >> it is not especially great in china. it is doing well in the u.s. in japan, korea, as well as china, all of them have homegrown solutions. >> what is the biggest messages thing -- messaging app in china?

>> there is one that is a round 300 million users. when you think about the chinese market, it is one billion users. >> what is it about -- is this simply because it is homegrown that it is adopted so much more widely in china? is there something that is more tailored to chinese users? lot going on in southeast asia. from a walkie- talkie. they invented push to talk again, but on your smart phone. if you think about chinese users, typing the chinese characters is not easy. you push to talk to your friends and it has been very popular. >> what about snap chat in china? -- you don't necessarily

have to use language there either. >> messaging apps in the u.s. and western markets have done well, but not as well in china. you do not always have connectivity. there is the slightest glitch, then you may have an issue expanding into the chinese market. >> we know that facebook and twitter are currently blocked in china. do you think if they are ever unblocked, is it too late for them? >> it is probably late. >> too late? >> you never know, but it is late. companies like $.10, alibaba, baidu are really doing well in china. >> we will continue to be watching. , thankd smith -- schmidt you. we will have more after this quick break. ♪

>> it is 56 past the hour, which means bloomberg tv is on the markets. alix steel has more. >> thanks, emily. let's get you caught up on what is happening in the markets. still a relatively mixed day for stocks. take a look at the s&p -- let me bring that up right now. it is pretty much flat, up four points. climbing its way higher. the nasdaq is 20 from the dow, off by four points. energy leading the way. the negative in the s&p is telecom, weighed down by verizon subscriber growth slowed from

record. the world'shnson, biggest maker of health care products has fallen for five months. the full-year outlook did fall short. also, natural resources are falling for the third straight a since october. fourth quarter earnings well below walt street incentives. -- wall street incentives. you're also watching zack post. zappos. it is a structure without hierarchy or management. what is it? itit is hard to explain what is in one soundbite or brief definition. what i can say is that it is a different system of rules to govern an organization. some of those

rules and what it is characterized by. isthe words of zappos characterized by distributed authority and self organization. that is because the company -- the people at the company are defined not by the titles that a manager hands down to them, but rather by their roles, the work they do, and what the duties of that work are. that is determined via a governance sort of committee and at the that happens beginning when the company acy, if youlacr will. and then you have tactical meetings where the company's intentions are worked out. it can be negative or positive. >> who fires people? at the end of the day, you will have underperformers. who does that? >> there are a couple of ways that is done. they are organized into circles,

given the various things in the organization. and there is a person called the lead link. the lead link of each circle is the one who is overseeing that particular circle. if someone within that organization is not fulfilling it seems the default is to try to assign them new roles, to switch things around rather than to fire someone. >> take what employees you have and find a job that fits then for -- fits them. >> yes, that there are people who are responsible for firing if it comes to that. it sounds more like a committee structure to do that. the ceo might be on that committee, but it is not by default the ceo's job to do that. >> why did zappos do this? >> they talked about the structure of the organization and research shows that every doubled,structure

revenue and productivity increased by 15%, but that is not what necessarily happens within a company if there is a bureaucratic structure. the idea is to make the company more productive. >> very interesting. we are on the markets again in 30 minutes. "money moves" is next. ♪ welcome to money moves, where we focus on alternative assets. andhow you what investors entrepreneurs are doing as well as what is going on and hedge funds, private equity, real estate and more. vc and pe pioneer that abc and pe pioneer is here. he will tell us what he is investing in, including details of a company that may change the way you get your news. and all asset manager