>> live from pier 3 in san francisco, welcome to "bloomberg west" where we cover the future of business. i'm emily chang. amazon prime play and we will have the big announcement of amazon fire tv stepping up competition with apple, google, netflix and more. first, a check of your top headlines. microsoft ceo says that

developers will want to build for microsoft because they will be innovating in every dimension. speaking at the microsoft build conference, they now have a challenger mindset. we will have more on that later on in the show. alibaba is investing in lyft intruding to this round of funding. this comes to the weeks after they invested in and another u.s. company. they're trying to build up their u.s. profile ahead of an ipo in the united states. blackberry will stop selling its phones in t-mobile stores when the contract ends. the ceo says, "our strategies are not complementary." he criticized t-mobile for encouraging customers to switch to the iphone. first to our lead story, a special show about amazon's big unveiling of the fire tv.

they had to get the word fire and there. >> this is significant. i hate covering product announcements but i really feel like this is an interesting position for amazon to be in because they are using hardware to get with their software has not been able to get. >> it is a small black box that streams movie, tv, wi-fi. it is $99 and starts shipping today. listen to what peter larson, the vice president of amazon kindle, had to say about what he can do. >> what can you watch on fire tv? it has a ton of content from zulu plus, watch espn, showtime, majorly baseball, nba, the disney channels, bloomberg tv, youtube.

it's the easiest place to watch netflix. >> you hear that? you can get "bloomberg west" on fire tv. edmund, i understand you got your hands on the device. what did it feel like? tell us. >> it felt like plastic. >> wow. >> it's exciting. the most remarkable thing is that it is pretty small. it's even smaller than the apple tv device. it is similarly proportioned but just smaller. instead of white, it's black. it has a lot of ports on the back of it. the hardware, the physical properties, matter less than what you get with it. the interface, what you have access to. bloomberg tv, for one. as they showed on the demonstration. also, the other thing to know is if you do not have a prime

subscription, there is less for you to watch. even though it's $99, you have to fork out another $99 or year to get the prime subscription to have access to the streaming shows they have on their. >> it has been described as a thick coaster. one thing peter larson pointed out is that it has three times the power and performance of 70 competitors. take a listen to what he had to say about that. >> this thing really screams. i can't wait for you to try it out. fire tv has three times the performance and power of apple tv, roku 3, chromecast. this is a powerful device. >> what does that actually mean?

>> people were tweeting from the event. three times faster than apple tv -- tweeting from the event. i don't know how to quantify it. i think what you is trying to go for is that it is probably faster. there is probably less delay on how content is streamed to you and a faster processor. all of those things do count but three times as powerful as hard to pin down so that was a bit vague. >> to what degree does this help amazon get around other barriers, prime video in the hands of consumers? >> prime video but the other thing is that they are really trying to own the living room in

terms of what consumers are buying with media. apple tv was an important thing because a lot of movie downloads -- dvd sales have declined because of downloads. now if this box, they can sell even more because it is that much more seamless, friction free for consumers to have a whole season going to their tv set which is really where they want to watch it anyway. they are battling for that ecosystem. they are still a retailer at heart. they just want to sell more stuff. >> it's on sale starting today for $99. admittedly, thank you for covering that event for us in new york. now to the question of how the streaming hardware will really change amazon's business model, a company with historically low margins. joining us in studio, someone who worked on building the

product and also senior west coast correspondent jon erlichman. jeff bezos was not there today. what does that mean? >> increasingly he's not on the front of these. he may be running the company but he does not fit his face out there for product announcements. >> kindle fire hd. >> i think this says this is an extension of what they are already doing. did amazon have to come out with an amazing amount of bells and whistles? they were pushing the idea of voice search today. i can say john malkovich and i will be able to find movies and tv. amazon is already well positioned in the living room because of what they've been doing with video to take the next step that they took today is kind of an obvious one. through amazon.com, they sell so many of these boxes that are not their round. maybe that's the message of jeff basis not being there. >> what was a process like working on this box?

>> the thing that struck us the most is the team that has been working on it from amazon was very open, very quick to support to add to this device. this is the one thing that stands out is that there is a focus on the basics. you hit play and it looks good. it goes back to the comments earlier about performance and why this really matters. screens are bigger. hd, super hd, 1080 p, you're going to need more processing power on the device in order to make the videos look good and you need faster connections to make it all work better. a number of things focused on that we really appreciate. this is one where it's increasingly hard to differentiate. you have to have netflix and hulu.

they have both of those services now. but those three things together with amazon prime from an on-demand perspective than they have a great lineup. now you switch to think about live content and linear content coming via the digital delivery mechanism and that is just starting to come together regardless of sports -- one of our partners is the acc, the college conference. i think these are just starting to come whether it is this device, apple tv or any other. we're just starting to see linear content. >> we should not leave out games. >> and a game controller. >> they have this game that was built from scratch specifically for this box and then you can buy a game controller if you want to. i think the power commentary is partially on that as a differentiator. >> when it comes to

understanding entertainment technology, we have three real strong categories with very different approaches. the thing that steve jobs talked about but when it comes to understanding entertainment in technology we have three approaches, game consoles, sony, microsoft. you have streaming devices with google and roku. then you have the smart tvs from others and those seem to be from three different camps i wonder if one will emerge. does this help you get around the issues raised by a comcast time warner merger where you will have someone decide what service you get fast and what you don't. >> it's a great question. the first part is that i do think it is true that game consoles clearly survey slightly different audience than a streaming player or a smart tv. it is someone whose primary purpose for purchasing the device is a game or playing games. the prices higher. you do not see a $100 console.

video is important but it's an adjunct to the gaming experience. take a streaming player and video is the first thing that people are looking to. the audience, the demographic, they're looking to either pull back on cable subscription or augment service with on-demand services and it's a slightly different market going out and buying these products and the price ranges from $35 to chromecast to $99 for amazon fire. >> they are all coming together. i don't know if we even need to distinguish between the groups because everyone is doing a bit. >> except for apple which is still a closed ecosystem and they made it clear that they were pointing it out that this thing is built on android. rajeev raman, thank you for joining us today on bloomberg west. fans of the x-files will soon be able to watch more from creator chris carter but they will not be doing it on fox. his new show, the actors, is an

amazon original. the writer and director joins us next.

>> i'm emily chang and this is "bloomberg west on your television, bloomberg.com, apple tv, and fire tv as well. we have been talking about the amazon fire tv announcement earlier this week they greenlight six new series providing original content for their streaming service, amazon prime. one show is "the after written one show is "the after" written by chris carter, the creator of

"the x-files" who joins us as some of the prime time coverage. you took a hiatus for 10 years. why come for an amazon original? >> i had written something years ago that i was excited about and it took me two years to bring it to the screen and amazon was the first who read it and loved it. that's why i'm in business. >> did you shop it elsewhere? >> amazon responded immediately but the process has been a lengthy one. >> it's jon erlichman. let's talk about this idea of having pilots. amazon has been very public. here's a show we are putting out for the public to watch and they

are very public saying we got this feedback and now we will go ahead. as a creator, at a time and you have players like netflix that are reeling from the get go to do these very big deals, should we assume that the approach of amazon in picking the shows is quite different than what netflix is doing? >> this is the first time i've ever experienced this. i will call it the gladiator approach which is really putting it out to the audience and they give it a thumbs-up or thumbs down. it is the wisdom of the crowd but i like the approach. >> we should highlight that while you are very much going down the amazon road, it's not the only one you are on right now. you're are working with amc as well. what would you say the primary difference between working with a player like amazon and one of the very well known table channels are broadcast networks that we know? >> it's not very different at all. different personnel and players that the approach is always the same, to do something original,

something smart and that is really how i approach my job and how everyone else approaches it to. >> how does the ability to binge watch change the way that you write or direct day show? >> this is my first experience doing it like this, giving the opportunity to binge watch and i'm not sure if amazon will put the show out there in exactly the way that you could binge watch. we have not really talked about that approach yet. for me, this is my first chance to work off a broadcast network. i'm really looking forward to that for other reasons including less restriction on what i can say and show. >> cris carter, we will talk to you a little bit more about what the after is after this quick commercial break. chris carter, creator of "the x-files making a new show for -- a new show for amazon. ♪

>> welcome back to "bloomberg west." we are talking with writer-director chris carter, creator of "the x-files." his new show for amazon is called "the after. chris, what is "the after" all about? >> people ask me this question

it owes a lot to "the x-files. it is science fiction but it is its own original idea about a catastrophe that begins in los angeles and it is a big mystery what has happened. >> jon erlichman again. if people are watching it through this new fire tv device, for example, do you think that when you are creating the story line, do you think about how people are viewing it, a small screen, does that change the nature of the story line, special effects, everything?

>> it's the same approach. i was mindful when i was choosing an aspect ratio for the size of the picture that most people would be watching it on a smaller screen and i imagine the ipad, for example as a place where i watch my streaming content. that is what i imagine, but for me, the images have to be great no matter what the size of the picture and where people watch it. >> amazon has not given the public much information about their audience. i wonder if they've given more information to you. they have been at this original content thing for little bit of time and not many can name a single amazon original show. they have not had nearly the success of "the house of cards." does that worry you? how do you approach that? >> it does not worry me. they are brand-new to the

business and we are in the frontier here. i think the approach is really good. i don't know anything about the audience but that's ok. my job is the same, to create great entertainment and i'm happy to have a great patron like amazon. >> really quickly, i have to ask you an x-files question. we've talked about the possibility of another movie and you said it was in the hands of fox. will there be another movie? >> i don't know. it really is in the hands. everyone is game and would love to do it and to continue the mythology of the show. >> what is your favorite show on tv or streaming right now? >> that's hard because there is so much great stuff. i love "house of cards."

i love breaking bad. it's a great show. i love "mad men." there has been some great television starting with the sopranos. so much good that has been on cable and now streaming. >> do you have a preference between a set top boxes out there, apple tv, chromecast, apple fire, roku? >> as long as anyone can get what i do, however they get it, if there is more opportunity, great for me. ex cris carter, writer and director of amazon original "the after." we cannot wait to see it. thanks so much for joining us here today on the special edition of "bloomberg west." amazon is taking on amazon and -- netflix and apple.

>> you are watching "bloomberg west where a focus on technology and the future of business. amazon launched its new fire tv bringing them into even closer competition with the likes of apple and google. all three the tech giants now offer internet connected gadgets for streaming video to a tv. the move also escalates its rivalry with netflix and other services delivering exclusive content. the big question is who will win

the battle for your living room? joining us now is brad stone and the author of the book on amazon and our senior west coast correspondent jon erlichman. i know you have been working on this story for weeks if not months. what do you think now you have seen it officially unveiled? >> they have been thinking about a set top box since the end of 2011 so this has been a long journey. what are the big ideas going to be? how will it raise the bar on apple, roku, tivo? there are a few medium-sized ideas with voice search. that's nice. there's the casual games bringing the men from the amazon app store. people want to play mine craft on their big-screen tv when they can play on their tablet? no big ideas, no interactive advertising. maybe that is coming but in version one they don't have it.

>> one thing they are playing on is search. take a listen to this commercial with gary busey. >> i'm gary busey. find gary busey. this new amazon fire tv listens to me and is exactly what i say. gary busey. yay! amazon fire tv. [laughter] >> it seems so simple but is this a big deal or is it >> do people really want to search -- >> do people really want to search? sometimes you have to go through the keyboard alphabets and do it. we will see how it handles. >> microsoft is announcing voice capability for search and

navigation at the microsoft builder conference and you start to see all of these companies coming together with the same types of stuff. i'm sort of curious about the game thing. you get the sense that the games were an afterthought? >> one way that they can distinguish this product. the app store does not have a great selection of games. they have tailored android. it does not have the google play store. they are just creating their own. they have built a studio and have acquired double helix games and introduced with some of the unique games will be for the set-top box. hard-core gamers want to play hard-core games. i want to play bioshock, not mine craft.

>> you can put all of the great businesses together whether it is gaming or imdb where you find out everything about actors in the entertainment business these days. jeff bezos made a big push on the idea that when you are watching elves, more interaction or finding out who the actor is and they seem to be pushing that again. i don't know necessarily of people you are using those services in a big way. >> jeff bezos was not there today. what do you think that says? >> he is still involved in lab 126 and the hardware product. they present these things to him every month. it was not even the head of the kindle division but it was the larson. this is a version one and a long-term bet. it's not getting the kind of attention that the kindle fire in the kindle e-readers have gotten with holiday launches. >> what about the apple closed ecosystem versus the android? what kind of a difference does that make? >> take a player like netflix. what they are able to do to is change the experience if you're using netflix on a roku device.

kids want to watch kids content and you can see these big, nice pieces of art going through, there are limitations if you are using netflix through apple. i think that is kind of an interesting differentiator between apple tv and say roku, google chromecast. >> are the content creators changing their focus from whatever they might have been trying to develop for cable or the networks into thinking about selling shows to people who will pay a lot of money, hbo, showtime, netflix, amazon? >> showtime is part of the announcement and it's really important for them if they can work out the deals, hbo was not part of the deal today. maybe there is something we don't know about but they will be on these different platforms. they don't want to make their cable friends angry because they get paid a lot of money to put their content there but they also don't want to get left in the dust. people are using these new

devices in a big way they want to make sure they have it out there. it is balancing it all out. >> when you look at the battle for the living room, is it an equal playing field right now? is someone more threatening than someone else? >> comcast, directv. the name of the game is still alive, linear programming. americans watch five hours of this stuff today and these technology companies have been hitting their heads against the wall because customers are not really cutting the cord in huge numbers and programmer still love to bundle their channels together to still them. >> it still the oscars, baseball, football. >> until they can write a huge check and starts unbundle some of these networks, these are nice add-ons. the amazon set-top box will be on top of the big comcast set-top box. >> the ceo of roku what

happened when google chrome cast launch, they went up more because now people know what it is. >> one of the advantages, they have all of the customer reviews of the set-top boxes and the best reviews by far are for the chromecast. >> all of a sudden there are new devices and people hear when they are all about. they like them. they are not that much money. $100, $35. more consumers start to learn about these so it's kind of been a no-brainer that the market is growing. like i wonder what it also means for the quality of content. it is something of a golden age of tv where we have these great shows in numbers we just did not have before. house of cards, the sopranos, the wire. you have kids stuff better than it's ever been with phineas and ferb, wonder pets, all happening at the same time.

is more money going towards better content? >> look at the second batch of pilots. they are so much better than the first. you have the shows like mozart in the jungle about the move -- symphony. that is really good. you could not really say that about any of the first batch of shows. chris carter of "the x-files," a lot of talent flocking to these new formats. maybe not viewers quite yet but that will happen. but low prices that they are not paying low prices. >> he says making a show for amazon is not that different from making one for cable.

brad stone, jon erlichman, thank you both. it's a battle we are obviously going to be watching. up next, tack taking on textbooks. ♪

>> this is "bloomberg west." i'm emily chang. >> the first-ever all-digital curriculum is making its debut in classrooms across the country. >> this is very different than putting together traditional textbooks and it's part of the bloomberg wiring the world willow bay reports on how pearson turned to an unlikely app developer to design and ipad-based course. check it out. >> this is a once-in-a-lifetime thing.

>> turn your ipads over. >> i do not think we will see traditional textbooks in really any classroom in the united states. >> this is what you might see. an entirely digital k-12 curriculum for the ipad, the first of its kind created by pearson, the largest educational publisher. as part of its aggressive strategy to dominate the education market by embracing new technology. >> i think this is a chance to really engage and motivate kids in ways we have not been able to for a long time. >> pearson knows about educating kids but they needed help making the leap to digital. so they turned to a global web and app developer. >> pearson came to us to say how can we create a user experience, an application, that will be successful in the classroom, work with the teachers and the students? >> teaching kids math and english demanded a new lesson plan.

>> this is actually that? it started simply as a whiteboard and it ends up being workable code. >> that code turned into 28 digital math and english courses and each unit has real-world illustrations, hands-on exercises built in notebooks for writing and drawing and supplemental

activities. >> we have interactive that turning the page cannot have. we have videos and animation that is part of each lesson. they are not separate from but a part of. >> this is a seventh-grade geometry lesson. >> in this particular lesson they present a house plan, how it relates to what you would do to add-on or figure out what size floors you need, that kind of stuff. >> is this different than the way you learned math last year? like you can see the links or the width. >> it the better educational experience for kids. that's what is behind this. ask also, a five-year study to determine if technology delivers on its promise. >> that was bloomberg's willow bay. the five-year study will look at student performance data before and after testing on the surveys from students, teachers and parents and it will launch in the five school district using pearson digital curriculum for september. you can catch the series wiring the world on bloomberg.com. another tech tool taking classrooms and companies by storm is the mook, massive open online courses -- mooc. >> they have taken on a new form

of education. >> hundreds of students can learn at once through videos, readings, practice exercises. many are taught by ivy league professors or leading experts. they started in 1995 and right now i want to bring in the cofounder, linda who joins us from l.a.. you say you guys are doing something that colleges are not. what is that? >> we were much quicker to market and we were able to deliver instruction on changing technology and a lot of the teachers are great at teaching their subject matter but they want to focus more on helping students individually and on concept, so we are able to help partner with them and be a complement to help teach the technology that is behind a lot of the tools that students use today. >> are the engagement levels fundamentally different when students are using tools like

the ipad? >> they're fundamentally different, but sometimes that's a benefit and sometimes it is not. one advantage to the digital tool is that they can be more personalized to summon the exact object in terms of what they are coming to learn. when you are in a physical classroom, everyone is experiencing exactly the same thing. there are a lot of social skills that happen in person so i'm an advocate of blended learning combining online and in person. >> how are you different from all of your competitors? >> we are an online library of instructional videos. think more about youtube except curated and taught by expert teachers. because we are a library we have a huge number of videos, over 100,000 videos on hundreds of topics, you are able to come in with many different learning objectives. i would say we have a broader

breadth of what it is that we are offering and we are a more flexible learning environment where we are more personalized to whatever it is you want to learn. if you have employees and you have brought in lynda.com. you have some people who are an expert on excel, they should not have to go through the same course. >> how is the learning itself different than it would be offline? >> i don't think it's a different. i think it is just more personal. what so great about video is that you can rewind, pause. if something went too quickly in the classroom, you don't have to miss out on it. if you want to go faster and kind of skip ahead, just the fact that it is nonlinear is so valuable. >> how are the schools taking this? when we talk to the founder of udacity, the schools are pushing back pretty hard. how are they responding to you and to lynda.com? >> we have been adopted by 40

and they consider us to be a complement. we are an online library that is a resource to them to help them keep up to date in keep the run faculty and staff up today didn't help students learn more independently so they can do different things in the classroom rather than all having to learn at the same pace at the same time. >> cofounder of lynda.com, lynda, thank you for joining us today. great to have you. barry diller speaks out about the future of the video streaming service aereo and what happens if it loses in the supreme court. we will have that exclusive interview next. ♪

>> welcome back to "bloomberg west." i'm emily chang.

microsoft is making announcements at its annual build conference in san francisco. microsoft will enable windows applications on the xbox and they unveiled an update. they also unveiled a new assistant, cortana, like siri. it is time now for the bwest byte, one number that tells a whole lot. jon erlichman is here as well. >> it's from halo, one of the characters. it would be really creepy if someone was saying, corey, where do i go? today's number is zero, the number of cities aereo could be

if they lose in the supreme court. here is what barry diller told erik schatzker earlier in a really good interview on "market makers." it was fascinating. >> it interesting to hear him be so open about it. >> if we lose, game over. >> there's nothing you can salvage out of the business, the patents, the technology? >> it's possible there is some salvage, but aereo would probably -- i say probably because i cannot see any path forward -- it would not be able to continue in business. >> that was barry diller with erik schatzker. >> at least he's honest. >> that's in parallel what we heard from the ceo that there is no plan b. there's no other way to go. there is a question about whether the technology could be easily

replicated by others. if the broadcasters go against them, that's a clear path. >> barry diller also talked about how he feels about amazon fire tv versus the competitors out there. take a listen. >> for those of us -- those of us who have apple tv -- no set top box or a roku or any of them, no set top box, a little thing, no cables, no wires, just plug it into the television set and have a broadband connection. amazon will certainly be a player in this. many, many others will be. i think it's great. >> sounds like he's a fan. >> a thoughtful guy about the way things are being consumed and putting himself in the middle of whatever the technology is. >> the more competition, the better. it's just about how the content gets to you.

>> remote controls are the conclusion. you can have a different set top rocks but people do not like it thing up the control. speaking of technology, media, and how people are consuming it, bloomberg tv caught up with some interesting celebrities at a new york observer event and asked about how they watch tv. are they changing their habits? >> i don't find that fun to watch on the ipad. >> i watch it on tv the old-fashioned way. i like it best on tv. >> i still prefer to watch on tv. i never quite find the right positioning for the ipad. it's on my lap, angled and appropriately. the tv is clear-cut. >> i am a binge watcher. i'm addicted to my ipad. >> i hate to say it as the anchor of a tech show, but i like watching on a regular tv, two. -- a regular tv, too. >> thanks, ivanka.

>> thanks for watching the special edition. we will talk to you later. ♪ >> the following is a paid

presentation for focus t25 brought to you by each body. >> it is about time. the number one reason people have for not working out is because they do not have time. >> i have four kids. i do not want work out for an hour. i do not have the time. >> no problem. introducing