>> live from pier three in separate cisco, welcome to "bloomberg west." i'm emily chang. ceo tospeak with the find out how he added to the -- how he added more subscribers and at&t. we'll talk about whether he's going to merge with sprint and whether he's going to run it. facebook may be facing legal trouble in its bid to buy oculus rift. a videogame company says it own some of the right to the virtual-reality headset will stop first, a check of the

bloomberg top tech headlines. linkedin has failed to reverse it slowing sales growth. sales rose in the first quarter but it's fifth straight quarter shows sales growth has declined. company also posted a loss ebay has settled a lawsuit with a federal and state government over deals with into it. under the terms, you may has agreed to and a nope 02 packed with other companies. forneyll also pay tell is three point $75 million. the settlement comes a week after google, apple, intel and adobe settled a similar case. the justice department crackdown on silicon valley hiring practices is over for now. snapchat has poached egg google employee, naming him as the

information director. the snapchat conversations will disappear but can be saved and screen shots. you may recall that snapchat rejected a $3 billion takeover offer from facebook. now to our lead story -- t-mobile ceo john legere has made it clear the fourth-place wireless carrier has plans to turn the industry upside down and so far, so good. 1.3 millionadded new monthly subscribers in the first quarter, more than the combined total for verizon and at&t. t-mobile is using cheaper plans and promotions to lure customers. this showed up in sales, which rose 47% to $6.9 billion. the company posted a loss of $151 million. the improvements come as sprint prepares to make a formal bid to take over t-mobile. , spoke with john legere

president and ceo of the company. i started by asking but the boom in subscriber growth and how it happened. >> this is one year since we started tm u.s. with the merger of metro and we added not only 2.4 million customers this quarter, with 6 million in the last year. post paid ads and 3.5 million in the year. we added 12 times as many phone ads as our nearest competitor. the only two competitors, the calculation is infinity. even smart people like you can't figure out how to do that math. it is a vindication that the un-carrier movement is the right one. it has plenty of runway to go and we are excited about it, along with the fact that once you have our numbers, the wireless industry grew into one. it's just hard to see because all the growth went to t-mobile. it's a good start. >> how long can you sustain it? how many customers on the margin

at at&t and verizon are that unhappy with their service that they will cut bait and switch to you? we've got just approaching 50 million customers. last time i checked, both of the duopoly have 100 million. there's a lot of runway to go. we are focusing on changes that consumers appreciate and understand and love. at&t and verizon have been making changes to respond to us and they are temporary and in the same kind of bureaucratic short term trickery. it's just not working. i don't care what they do, i'm just focused on making the changes to solve consumer points and their are plenty more. i don't see any reason why we can't continue this momentum. as a relates to verizon and at&t, color me unimpressed. >> this is a true story -- i was

in a car with them uber driver who just switched from verizon to t-mobile. he said it's a lot cheaper but the network coverage to did not compare. could switcht he back. what about those customers and the risks of expanding so fast that you can't accommodate everyone? >> was your driver cory? he is an uber driver now, isn't he? interesting topic -- yesterday, we got approval for the 700 and acquisition which will be building out. our network improvement over the past year from zero pounds to 220, now looking to 220, with the deployment of the 700 megahertz and which will be focused on in building penetration and rural edge coverage. bute got some work to do, there is line of sight to it and i would tell you that the

improvements in the network were directly correlated to why we sent,cord turnout 1.5 are which is part of why along with moving from 11% share to growth ads to 26% turn moving down as a no contract player. that suggests these improvements are working and we will continue to invest and i am hopefully, vis-à-vis the name of the driver, we will find out what his issues were and we will solve them. that's what i do every minute of my day, on twitter and on phone is work on individuals people's issues and that's working. >> i will see if i can track him down. losing more money than some people thought you would be at this point. how long are you willing to continue to do that? >> let's put that in perspective. when people say we are losing more money than people expected, we shifted our own guidance from -- we changenge of

it to five .8 and that's because in q1, the volume of is this coming in was huge. that is a trade off anybody would make. it's not sacrificing profitability or not i, it's an acquisition game and the cost -- the cost per customer acquisition game -- we front end loaded a lot but our medium-term cash flow targets are completely intact. if not that are than ever, especially with the metro pcs merger going way ahead of schedule on all fronts. reporting sprint is planning a formal bid for t-mobile and you are the leading candidate to run a combined company. when i tweeted this yesterday, andtweeted yesterday and my a smiley face. what does that mean? >> come on. what does it mean? i'm proud of you.

it took you approximately seven minutes to get to this, which is seven minutes more than i thought it would all stop and when you say bloomberg, i think it was actually you. could have caught you directly, it would have been other than riley face. about thisave talked before. consolidation is one path to work for this company. comment on anyo individual talks that may or may not go on, but with the growth we've got and options we have, consolidation is one option and our shareholders and owners would consider any opportunity. i'm not privy to what you learned there and the individual speculation about me is you know my own opinion of myself will stop it would be easy for me to comment on that stop >> i should give credit to our deals team. i simply tweeted it. think say, how do you from a competition perspective

that the industry has changed since at&t tried to buy t-mobile? you are making t-mobile stronger underminet sort of the argument that at&t and verizon are unstoppable duopoly us? few things. but we are seeing right now that is fun and i'm having a ball with it is a glimpse of competition. the big ties are nervous and trying to figure out what to do. celebrating the ability to pick people against each other. that is competition. it's great for america and great for the industry and in order to keep that competition, which is a big goal of the chairman of the fcc, a lot of things have to happen. you have to make sure the duopoly's don't get far ahead and use their economic prowess. of onedation is thought way of scale.

possibility -- that was a different game. people were looking at consolidations to aggregate spectrum. right now, t-mobile is a thriving, fun entity with a great path forward. when people look at t-mobile, it's about how to take this maverick approach, take this on carrier revolution and keep it going full out one way you do that is scale and spectrum and this is just one possible theoretical way forward. it is a very different time and different environment. you had some #that were things you said about sprint. what were you doing? >> the things i would do differently at any of these kind and eases run them. focus on consumers and stop all the idiocy of looking at each other and just focus in a very

humble way on serving customers and solving their needs of the -- solving their needs. kidding aside, what you did there, social media is nothing more than another way of touching individual customers and listening to them. the difference with me as i listen to them and i walk in and use that as the strategic input into how i run my company. it's not mckenzie, it's not pain, it's individual customers on twitter telling me what's new , creating the next phase of the on carrier and i would do that in any of these big companies. frankly, i just don't know if those companies are ready to change. whether it is sprint, at&t or any company, this is what we do it's all not just me, the employees and all my management team. and we are having a ball doing it. >> john legere, outspoken as

always. face book is paying $2 billion for the virtual reality company oculus, but does the company that power oculus belong to someone else? we will tell you about the conflicting claims when "bloomberg west" returns. ♪

>> i'm emily chang in this is " bloomberg west" on bloomberg television and radio, streaming on your tablet and on bloomberg.com. oculusk agreed to buy a for $2 billion. now when videogame publisher is trying to get a piece of the deal. cinemax media, no for the popular fantasy game "the elder right tois a has the the technology powering the oculus rift headset. they claim a former employee took their intellectual copy when he left the company and later become the -- became the cpl of oculus.

-- cto of oculus. they're trying to reach deal where is any max would be -- where they would be compensated but were unable to reach a satisfactory resolution. facebook did not comment. our tech editor joins me now with more -- he's one of the 50 reporters and enters here in our san francisco bureau. what does it sound like happened here? >> you have someone who left one company that was building something to go to another company that was building something. those two things happened to overlap in a reasonable way. >> five people from the previous company went to work at oculus. cracks right, so you have a nimax untilrom ze oculus has this major outcome -- when facebook hot oculus, he didn't really have a product on the market and was no revenue. the thought of it being a $2

billion company was absurd. it's unlikely we would see anything like this happen without this sort of outcome or until outcome. nimax has some heavy hitters on its board like jerry bruckheimer, the director. what are they doing in the virtual reality field? if you look at this technology, oculus has eclipsed them. are they trying to profit off of someone else's success? >> today, their titles are primarily on web and multiplatform, but not necessarily this third or fourth screen, if you will. but this is a nascent market and this idea that you can play video games at home with goggles -- thisthis is not an is not a market we've seen kickoff. it's not clear what they were doing in this. presumably, they were making games that would be used on these future formats, but we don't know. indication that

mark zuckerberg should not be negotiating deals in weeks? when he bought oculus, it happened so fast. but she's probably learning a fair amount about how to do m&a and building a team to help along the way. one thing about some of these deals is in some cases, they have to happen quickly because you are in this environment that's very competitive. we don't know who was putting forth it's for oculus, but we know it was competitive. at some point, if it's something you want and something you feel like your company has difficult the without coming up to make a bid -- difficulty without, you have to make a bid. >> coming up, we'll go inside pepsi and talk about in-home soda technology and if it could be a threat to the bottom line. ♪

-- the company also posted a $13 billion lost. linkedin is counting on international expansion to boost its road. ari lee v is back with me now. what is going on here -- five quarters in a row? >> is slowing sales growth. a growth rate is coming down, but they are hitting the law of big numbers. they have been a company that has grown 50% for a long time but it's just hard to 16 that --

hard to sustain that. so may people sign on to the service, it's not about getting more people, it's about monetizing them better. it's a ballgame all of the social media companies are trying to play out. >> a also missed out in terms of monetizing current users better. what are some of the initiatives they are doing at her? there's a push to create more regional content and the acquisition of pulse on one hand. what else? >> the real key is engagement. getting people on the service and getting them to stay longer, so as not just about professional connections that job searching. it's actually a site where you can find news that is the -- that is relevant to you and you can see you are some people you should the following. it's a customized news service they are trying to build out. >> a also established a chinese language service. into know how that fits

what they're doing internationally? >> not a lot of color on that but international is very important. they have in a u.s. centric company -- i believe it was 40% of revenue now comes from international. but once you get outside the u.s., it's a much more this a lot of kids to >> competitors have fallen by the wayside. linkedin stands in a league of its own? what companies out there are a threat to their business? >> it's hard to see anyone company that is a threat to stop linkedin is the singular service every recruiting agency and every recruiting department has all stop they all use it. you can't say that about anything else. that particular area, they are a monopoly. you have other services that have evolved into connecting people looking for jobs with employers -- angel list, and the

tech universe has tons and tons of companies on their site and people are using the service for all sorts of information. search about job websites like indeed deed? >> you just haven't seen anything get to scale where you would say they are a legitimate competitor. but there are areas where people have seen weaknesses in enacting. -- in connecting. if you are in that position, you get spammed from requests all the time. >> i get them all the time because i don't know -- >> it's because you are fabulous. i hear from programmers that they don't even go to the linkedin page because they have so many requests from headhunters. if you are a headhunter, you're getting paid to make connections, so you send out as many requests as possible. lex it does seem to be the only good way to really verify what someone is actually doing right now and what they have done in

their past. as a destination site, is the equivalent of wikipedia. if you are searching for something about the world, wikipedia is the second or third link inevitably. if you are searching for someone and they have a linkedin profile, it's inevitably the second or third link. they have established themselves as that and that's going to be hard to deflect all stop >> tank you so much. -- thank you so much. one of the most highly anticipated ipos of the year may be delayed. as a downturn in the market to blame? you can watch us streaming on your phone, your tablet, bloomberg back, and amazon fire tv. ♪

>> you are watching "bloomberg west" where we focus on technology and the future of is is. cloud storage company boxes holding off on an ipo until june because the downturn in demand for tech stocks. they ipo filing meant could have gone public as early as last month. our ipo reporter is in new york. tell us what you know about the conversations that have been happening behind the scenes and how they came to this decision. >> box and all of its bankers are looking and saying we could have gone public this month, but why not wait until the markets are little more stable?

we've seen a lot of ipos, especially tech ipos performed down after going public, so it helps their case to wait until the market is stabilized and there's a renewed favor for tech stocks in general. >> what if the markets are unstable by them. nobody knows how it's going to play out. >> that is the risk. it depends on what the company needs to go public for. it could be beneficial for them to just wait. they will eventually stabilize and we've seen the tech stocks run out. it could be they wait until things are little more calm and they've renewed appetite for cloud companies and we are cloud company and should go out now. if they can afford to wait and to their ipo when that does happen, that might suit them better. that said, other companies need to do their ipo sooner rather

than later for specific reasons. aries is doing their ipo this week. markets were rocky turnouts were great, they had to do downsize ipos, but they got the deal done. >> box is saying a date was never set. what do you make of that comment? >> typically what happens is these companies will disclose their perspective -- their prospectuses. aty are a let -- they are growing company because they have less than a billion in revenue. when those financials are disclosed, they have 21 days to start the roadshow. the key words there are at least because it gives them as much time as they need to start the roadshow. what they are saying is they never planned an official start date or the roadshow. they never set a schedule for when they would begin, so there was no official delay, they are just technically holding off until the summer, when things

look a little better in the market. >> thank you so much for giving us that a day. strive -- aare to growing number of payers -- players in digital payments, there are many of them. appk is a mobile payment quickly gaining traction and it could be an acquisition target. possible the $20 billion mobile payments industry as a whole is losing steam? joining me now is an early investor in check. thank you for joining us here today. tell me more about check. this is a company that basically helps you pay your bills. >> 10 million people have downloaded it. they process 2 million payments a day. it's the easiest way for you to pay your bills from any account. lex so among their competitors, intuit is trying to buy check. what's the latest on that?

>> we do not comment on rumors and speculation. companyxcited and that has exceeded the high expectations at menlo. >> what do you think is the future because there's competition in this space? what makes you interested in this company? it sounds simple. lex it is actually quite complicated to make sure you can pay your bill from any account you have in an easy way. what check has done and 10 million people agree, the the easiest way for you to pay a bill from anywhere. >> what about the broader mobile payments landscape. what do you see? >> think about it -- they have $15 trillion of transactions going through. but when you do a transaction, 300 basis points get lost. have a goodes, you banks, visa, mastercard, who all have leverage and want to be part of the transaction. it's not clear how an early stage company can win in the

space. >> to have been reports that square is looking for a buyer but maybe can't find one at the valuation it recently raised money for. what do you think a lot of company like square and its future? fax square is a very innovative dumping and made a great design and came out early. i think what they are trying to players like visa and mastercard, it's a tough out to win. i wish them well but it's going to be a tough battle. >> what's so tough about it? i see a lot of merchants with their square dongle. is an existing value system where people can make money. issuing banks and networks, all of them want economics. square has to figure out a way to create value for the consumer as well as for themselves. lex who wins in the mobile payment is this? is it always going to be paypal even if they don't have the most

innovative technology question mark they command the biggest part of the market. >> someone who can command the system. it's an integrated experience. it's not dissimilar to the music industry and the ipod. when apple came out with the ipod, they came out with the experience that was beneficial for everyone. we need someone to do that in the mobile payments area. >> is someone going to do that? >> paypal has an early lead, but this is going to be fought with amazon, apple and microsoft. ask what about apple and google? google wallet has not been super successful so far, but they are the two potential giants. >> i think apple is very well-positioned to do this, especially given the position in mobile. if i had to pick a winner, i think apple is the wonderful the 800i think they are pound gorilla. >> why? >> he does they own you. they own the consumer experience. i think they will figure out a

way to work with the banks like they did with record labels. >> some of the record labels weren't too happy about the way it all worked out. thank you for joining us. >> thank you for having me. >> how can the government disrupt disruptive technologies? elon musk is fighting bureaucratic battles on three fronts. we will have the latest, next on "bloomberg west." ♪

>> i'm emily chang, and this is "bloomberg west yuriko just two days after suing the federal government, spacex has won a temporary injunction barring the government from buying russian rockets from the joint lockheed martin venture. --reached the session after

spacex accuse the government of creating a monopoly by shutting it out of the market for military satellite launches. warned that using russian rockets my violate sanctions against russia the invasion of the crimean peninsula. elon musk -- only one of the bureaucratic battles he's facing. he's also challenging various ranges of the government with his electric car company tesla and his solar company, solar city. all three of these companies have benefited from substantial government support for the development of their technologies and ongoing tax incentives. cory johnson spoke with the author of "big bang disruption." he started asking if there should be government subsidies for emerging technologies like those must receive for tesla. >> i think a really early

technologies, university level research, it makes sense to fund that because otherwise it may not get started. but once it has gone commercial and solar has reached that this, it doesn't need level of government involvement anymore and it has become counterproductive. >> have his businesses needed government involvement or used government money inordinately? >> they have all used it and at certain points, they've all needed it. you can't imagine doing space exploration in the 1960's without the leading government in the world. >> doing it in 2014 and depending on hundreds of millions of dollars and nasa grants to get the business up and running. >> now we have reached the point where may be in space exploration, still some, but not in solar and not in electric vehicles. there's no need for government incentives. they are getting in the way. business he's best known for, makes a really cool

car. but it's a car for millionaires. the average sales prices over $120,000 last quarter. and a car that has elicited from hundreds of ilion's and government grants and subsidies. >> yes. the fight has come down to how i gets sold and destroyed it. he's running into regulations that were put in place may 100 years ago to protect car dealers from aggressive manufacturers. but we all know car dealers are not protecting consumers will stop -- consumers. maybe even congress is slightly at her loved than the car dealers as far as consumer protection. it's gone from protection to protectionism and that's what's behind the fight he's having in new jersey and other states and -- other states like new jersey and texas. >> we discussed tesla and the grants they've gotten him about what about solar city.

-- what about solar city? city, when carbon fuels were not as scarce as they have become, it needed some help. it needed some research help. has long since gone. we do not need the grants or tax incentives. we don't need the direct investments of solyndra -- >> which is ironically two doors down from tesla. >> these are not any longer would uses of the regulatory regime and in fact, they are now interfering because you have companies like solar city so focused on maximizing tax breaks and subsidies that they've built the entire business around the way they have leased rather than selling the materials to the consumers. they're so focused on maximizing the revenues from the government that they are no longer in the business of disrupting energy and that's what we want them to do now that the solar power can

be built cost-effectively and as carbon fuels get more unpleasant and unpopular it scares to use, they are on a trajectory. they don't need that much level of help and help has become counterproductive. >> does elon musk run the risk of hiding the hands that feed them by suing the military for the way they award a contract to lockheed martin, for suing pieces of the car industry when he's trying to get his cars sold in places where they are not allowed to be sold? lex sure. this happens all the time. no one takes it personally on the part of the government you're dealing with when you are litigating and the part of the government when you are dealing with when you are getting services are so far removed. it's not a egg risk. it's part of a way of disrupting this industry, but you have to go the other route if you are going to break it open and do it quickly. "egg bangauthor of

disruption" with our own cory johnson. make youhing tv hungry? we will show you how a streaming service lets you order a pizza. you can watch us streaming on your tablet, your phone, apple tv, and amazon fire tv. ♪

>> welcome back to "bloomberg west" i'm emily chang. it --s trying to make google is trying to make it easier to get products on youtube. they've announced a new presentation to advertisers in new york. jamie byrne explains what it is. >> advertisers have always told us they want us to help them by advertising, so we created google preferred, which is the in 5% of channels on youtube 14 different categories.

what that really does is help advertisers find the content that is most popular, the content shaping pop culture and the content growing fastest on youtube. >> youtube says it's going to invest heavily in building up the brand of its various youtube stars with billboards, tv ads and more. streaming service hulu also presented to advertisers this weekend announced its own innovative tools will stop jon erlichman is nla with more. busy week for a the new media and technology companies to touch themselves to advertisers. it's not just about the content or the shows, it's about different ways you can advertise, including this initiative between pizza hut and hulu that if you are watching hulu, through hulu you can actually order pizza. we talked to peter naylor of hulu about it. hear him explain how it works. >> in the case of eats a hut,

you can be watching your show, the ad pops up at dinner time and you say let's order pizza. while you transact within the ad, you don't have to click away or open another browser. you play short order and when you're done, you close it up and resume watching hulu. commerce-enabled ad unit. >> do you want to make up any yeses about how much pizza will be delivered through hulu sales? >> it's about serving the on demand audience. they want their content when they wanted and they want and they what -- and they want to buy what they want when they want it all stop i think it's going to be positive. >> when you hold an event like the upfront, clearly marked as --ront come paired to some compared to some media players. because of your ties to television and the belief that the shows you guys are doing our very high quality, is that

right? >> the language we are using and calling our event upfront is about the fact that we are competing for television dollars. the majority of our content is longform. we get it from broadcasting writers, cable providers and we make rate originals like deadbeat. ergo so we areat competing with television competitors head to head would we go and chase marketing dollars. that's why we are saying up front because that's the market we are playing in. >> the numbers of people paying subscriptions for hulu has been climbing. i believe it's up to 6 million. then there's the advertising dollars. i believe in 2012, the goal had been to work with it on a

thousand advertisers and then double that amount. what is the goal now? >> our current number, we are over 1600 advertisers. really have a goal to grow the amount of advertisers, but i do have a goal to grow the volume we get out of those advertisers. we work with the fortune 500 and fortune 1000 marketers you see on broadcast and cable television. to necessarily go deeper into a mix of advertising, i want to go to the biggest marketers in the world and continued your they're sure. >> as you guys bring the ad supported version of hulu to mobile devices, that does in the door to try a lot of interesting things. stuffs about some of the you are working on like the 360 experiences. >> the 360 ad is something we are partnering with a company called immersive media on. you aresomething

consuming hulu on say a tablet or smartphone and it almost places you in a virtual world. the first proof of concept we have laces you in the front seat of an automobile. when you take your device and look around, it is as though you are looking through the lens of that licensing the interior of the car. interesting way to take advantage of mobile devices and present a form-function commercial that fits the device. day, wouldnd of the you say we are at a point where you are in the position to take advertising money that would have traditionally gone to a broadcast network -- obviously you still have strong ties to that world, but is the money coming to you guys that in the past might have gone to traditional television? >> i think companies like hulu that we are taking money from

conventional television budgets. i also suspect some of the sandpaper awayng from segments like display advertising and even from print to a certain degree. huluat was peter naylor of , who i spoke to from the f eightconcert -- the f conference yesterday. >> i want to talk to about the latest on the clippers situation. i know you've got one number that tells us a whole lot and that has to do with what's going on with the team. >> yes. so our bite will be five. no fewer than five egg names that have come up in the potential hitting for the clippers. azoff, at name, irving well-known player in the world of music, a longtime manager of the eagles, confirmed he would he interested in bidding. see pictures of oprah and magic, larry ellison's name has come up and ava geffen's name

has come up. positioning themselves for the potential sale of the clippers. >> any fan favorites so far? >> maybe that's what they are doing -- putting it out there so they can sue the reaction will be like on twitter and gauge who should team up with two. it does feel like you might see a variety of names that team up. it might not be unlike the we saw with the dodgers here in town were he have some big financial investors and an established people in the community like magic johnson will stop still early days though. >> game six tonight -- the clippers are in the lead. we will be watching. jon erlichman, thank you so much . thank you all for watching this edition of "bloomberg west." we will see you later.

>> welcome to "lunch money," where we tie together the best interviews, video, and stories in business news. i'm adam johnson. take a look at today's menu. we will go inside pepsico. this is an exclusive look. nobody else has got this. in sports, we go clippers shopping. oprah, it turns out, she jumped in for maybe a bid on buying this basketball opportunity. elon musk scores a win in getting u.s. to drop russian rocket engines. meanwhile, companies small to big, babyiators confront the growth challenge for making shades for kids.