>> live from pier 3 in san francisco, welcome to "bloomberg west," where we cover the future of business. i am emily chang. ahead this hour, priceline buys opentable valued at $2.6 billion. the moods and restaurant booking to their online travel business that spans flights, hotels, and cars. the deal is the first big move for the ceo who took over in january. the head of twitter's made a unit is leaving the company, she ran the team that works with the television company and ouster

exit on twitter. her departure follows the resignation yesterday of the coo. and the season finale of the hbo hit "game of thrones." this could be the best episode ever. he explains what it is like directing such a popular series set in so many locations around the world. is stepping up its acquisition spree by buying opentable in a deal valued at $2.6 billion. the all-cash offer is 46% higher than opentable's closing price yesterday. it has 31,000 restaurants. it will help priceline connect to local businesses. the company says the deal is expected to be completed in the third quarter. cory johnson is here with me now in the studio and with us from san diego, paul kedrosky.

thank you for joining us. what is your take on this deal? good, bad, the right price? >> i think it is a great deal. especially if you aren't opentable shareholder. opentableare an shareholder. it is a fair premium. they don't want anyone else to come in on this. the thing that is surprising is that it did not happen a long time ago. front end ofin a the travel-entertainment marketplace. these properties will not be stand alone for long. opentable was a natural acquisition. >> would you agree? >> is great for the shareholders. thatis the kind of company can expand its market.

theamentally one of problems with opentable is if you need a reservation in san , you mightr new york need some help getting one. if you live in minneapolis, in charleston, it is not as hard to get a reservation. in europe, opentable could see some opportunity, priceline has had success opening doors in the hotel business. that is where the growth of their business has occurred. compare to this other competitors? beeniceline has unapologetic about that. rebrandingod at not the things they require so they have these discrete silos they cross promote as opposed to buying the services and rebranding them as priceline and saying that thing you used to like is now just priceline. ast is smart because

consumers find favorites and become dedicated to those opentable services, is one of those default choices when you want to pick a restaurant. so i think that makes sense. >> what does it mean for yelp? >> yelp has loomed for some time. it always comes up as an acquisition target. >> and as a competitor for reservations. it drives a lot of business to opentable. one wonders when they might want to get into that. they have successfully embedded themselves in the hardware of restaurants in ways that are different than other companies. and so they have a lot of software, they know about customers, which are a pain in the butt, which like a certain

kind of server, have a certain history. them have someps stickiness in their industry. >> i am finding i am looking at google restaurant reviews before yelp reviews they stone they way they surface. is yelp in a difficult position? >> they are. the yelp the data is so much richer than the google data. google isnd what doing, trying to make sure yelp does not have more market power. the reality is people are in doing more and more searching on mobile. when you search for a restaurant, you do not pull up google, you pull up yelp. the power of the desktop is small with respect to driving the surge and seeing who's reviewed data you use. that is the important shift which shows why yelp has so much

power. is there a question about valuations given the price of this deal and so many tech deals we have seen so far? yeah, some of this is an attempt to make sure no other bidders show up. you end up paying so much to make sure the deal is not competitive, you make a de facto competitive and you pay a premium such that the deal is no obvious how the underlying results turn to out to be good for your shell holders -- your shareholders. they will not be a huge boost to the bottom line. trade is 10line times sales right now. they need to acquire earnings and sales to boost event. i will also say the valuation discussion is interesting.

there is a direct correlation between opentable and huber -- uber. the customer has a certain technology and the provider of offering have the same technology, ios, android. they will use that to really make a business work. same thing based on the same idea. we've got the same technology from the provider to the consumer and they're delivering a new service. johnson, we will talk more about valuations after the break. paul kedrosky, thank you. have left twitter this week. what does it mean for the future of the company? we have george zachary with us next on "bloomberg west." you can watch us on bloomberg.com, apple tv, and amazon fire tv.

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>> i am emily chang. this is "bloomberg west." been busy, after sending her first memo to employees where she outlined her vision for the company's future. she has made her first official appearance to eating a photo to celebrate the opening of the herd retail location -- of the third retail location in tokyo. executive exodus at twitter? just after ali rowghani resigned, chloe sladden also announced her departure coming weeks after the former vp of product michael and senior vice president of engineering to me. joining me now is an early

investor, george zachary. george, what is going on? >> good question. i am not involved in the day-to-day business of twitter. i really don't know. is focusing the company and growth. it was small because growth was distributed across business units. he is basically centralizing growth tom a which will be very good. >> he seems to have the support of employees and the support of the board. is that how you understand? what is the problem? why can't they get the executive house in order? these reshuffles have been going on several years. >> since i invested. >> why does it keep happening? >> part of it is the dna of the company. it is difficult to change it.

>> do you think this goes back to the bad blood between the early founders? >> i'm not sure if it was bad blood but a lack of communication. i think it is directly connected and it radiates forward. this happens in almost every company where you've got the early cultural values, even if the people are gone. >> what do you think dick costolo should be doing? >> he should be centralizing growth. that worked well before. the product needs work. but the people i know, i believe there is high engagement of the users at twitter. i can see the next generation of the product driving the growth. i think all of the people that were there were great, and the people that are new and active in the company are going to add a different flavor to the company. >> how concerned are you about

user growth? >> laster was not great. the picture of them was that this was a niche product. i do not think so. i think this is a global product. this is not facebook, which is a social network between friends and family, this is a network for everyone in the world and more of an information network. >> you are not concerned. >> i still own my twitter shares. >> how would you describe the culture at twitter from what you know and your early work if the company? there in not been two-three months. i had a lunch with a friend of mine. everyone looks like they are working hard. there is a lot of energy. people are not slacking off for our board. d. said you -- or are bore >> are you worried about anything?

canhey have to prove they actually grow. until they do, no one will take it seriously. twitter was one of your biggest hits, you have had a what is thethem, next one, the next big hit? pebble,company called which is a smart watch. sold 400,000 smart watches, which is about the same number of ipods sold in its first year. of the criticisms is that the interface is not as modern as samsung. it also gets mixed reviews. how do you respond to that? leaven personthe company and now we are up to 100. anwe were and you have a -- 11 person company and now we're

up to 100. the founder of pebble has been doing watches since he was in college. they are atelieve 100. i remember when they were in this tiny space in palo alto. that was not that long ago. >> that was about 15 months ago. >> what about apple? >> of course i'm concerned. company. igreat expect they will come out with a watching it will be high-priced, in the $600 range. want to basically have the most amount of users in the world. we are taking a global focus of the smart watch for the world. how apple is about having difficulty getting great talent and that people were not as happy as they used to be. is that what you're hearing when

it comes to this idea of apple innovating and how? >> we will see. i think the innovations they made a couple of weeks ago were very good. the big thing everyone is waiting for is the hardware innovations. watch, healthmart sensors. it is unclear. apple will make a bigger smartphone. airbnb,tions, uber, dropbox? >> compared to what? is really share price times the number of shares. imply what the future shareholders will pay. >> can they give everyone a return? >> that is a function of the market in the future. it is frothy, like i mentioned. the stock market is like a game of musical chairs. no one wants to admit the music

is going to be over. public markets, you are seeing tech stocks being revalued. twitter has dropped 40%. inuations are only going up the private market. >> there is so much private capital available. people have seen there are these big hits in the public market. twitter has a large market cap. theeople are expecting companies can grow into global phenomenons. worth tensey become of billions of dollars. >> you do not think it is dangerous. >> i would not personally invest at those prices. i get in at the two people and an idea stage. when you're at that point, you are into momentum, working on market timing. one of the number one factors is what warren buffett said, his best indicator is the ratio of total market value to gdp.

the highest are at ratio other than the year 2000. to imply it is not frothy would be wrong. it is definitely a bubble that is inflating. right, george zachary, always great to have you on the show. thank you for joining us. hewlett-packard will cut 50,000 jobs. not everyone is feeling the pain. the ceo's bonuses boosted in the midst of a turnaround. ♪

>> welcome back. i am emily chang. hewlett-packard keep

playing off more people? visit meg whitman make more money the more it she restructures? pay.t boosts here is a cory johnson found. isthe one-timer structuring going to take more time with more layoffs and it could all help meg whitman make more. attructuring cost estimated three point $6 billion in 2012 4.1 billiond to dollars, half a billion dollars more and 29,000 layoffs turned into 50,000. what is restructuring? let's take a look at business as usual. you have a new idea. you hire somebody to build it. maybe it becomes obsolete. maybe it fails. you shut down the project.

it suggests the shutting down of the project and the laying off of the someone really does not count. that is how the accounting works. up, but the restructuring goes down here. that is the bottom line. that is what the shareholders get. the more cost the company to move from here down to hear, the bigger adjusted profit. then there is the bonus question. meg whitman has received $50 million, a $4 million bonus last year. hewlett-packard has seen 11 quarters of shrinking sales. net profits fall, losing $12 billion in the last three fiscal years and restructuring will cost 50,000 people their jobs. you wonder how does a company raise bonuses?

a quarter of her annual thentive line is based on bottom line is defined as this, the non-cap profit, not the bottom line. so the more cost she can move from here to here, the bigger the non-gap profit and the bigger her bonus, and the bigger the layoffs, the bigger her payback. there are other factors contributing to her overall payback. until that happens, with every theructuring, it improves structure of the ceo pay package. >> cory johnson with us now. what has hp said? >> they stand by their compensation plan. they say it is based on numerous factors, including cash flow revenue and earnings performance. earnings performance of course is their definition of earnings,

not actual earnings. >> is hp unique on this? >> there is no other company that has had 26 consecutive quarters of restructuring costs. it is been restructuring since the first quarter of 2008. consecutive quarters of compensation going back to the first quarter of 2008. >> in general, doesn't seem like the layoffs are helping the company? >> the results are getting worse. the profits have fallen. down to $5 billion in profit. those costs, it creates a bigger pool for her bonus. her bonus is going up and her salary. salary is one dollar $1.5 million for the current year. >> the san francisco giants are the baseball team in tech's

backyard. how do they connect with fans? we will hear from the ceo larry baer, next. ♪

you are watching "bloomberg west" where we cover the future of business. i am emily chang. the san francisco giants are at the top of major league baseball. how does a team use tack on and off the field? i put that question to larry baer. a listen. >> we use technology on the business side. widely known that just now the light bulb has gone on about tracking hitter's tendencies. in can see defensive shifts the infield and outfield.

you will see more often than any before, three position players on one side of the infield as opposed to the balance, two-two. because you're tracking trends of hitters. there is a lot of advanced metrics that have to do with tendencies that have become a big part of the game today. >> du have times where you're questioning the data versus your instinct? it goes to the manager on the field. is, it ise manager his job to blend that with gut feel. and you could say this pitcher is going to do well against that hitter, but this pitcher in the bullpen might have a stomach ache, might be going through a divorce, not feeling good, for whatever reason. it is not the right move. takes theager information and blends it. just going straight off the analytics is a mistake.

we are not robots. >> you do have some injuries this year. any innovative ways to getting them healthy again? >> in baseball it is a 162 game season. we really take our time getting the players back on the field. rehab, we want to get them back in minor leagues. we are really careful to measure the approach. >> at&t park is one of the more tech savvy stadiums. what is next? >> or is a lot going on with us in the ballpark. so much of it is through at&t. ceo, they haved their name on it. they wanted to be an advanced

ballpark. we had wi-fi before others and we do upgrades in powerful ways. be the daying to right now that you walk into and you say i like my seat, but i would like a better seat. you go on to your handheld, and bingo you can be in another's seat. that is happening in real time in the ballpark. >> the 49ers are moving to a new stadium. they claim they will be the most tech savvy stadium. >> the 49ers and the giants have a good, there is a # sfrules, along those lines. we have a good compatibility, starting with alex smith wearing a giants cap at all of his press conferences. they will be 15 years younger than our ballpark, but we are keeping up with the joneses, doing new things.

we want to be relevant to the fan, and the fan is looking for a two screen experience in general. if they are home, watching the thingsf they are doing we want to be relevant to things they're doing with their handheld. it relates to statistics, replays, and getting more information. the team is very active on social media. is that a requirement? >> the players have brands. what is important is if the player brand and the giants a brand can coming go. we found that is the case. actually did a commercial that we produced with yahoo!, with sergio. it was a perfect example of everybody coming together and

then the giants would tweet about it. everybody's talking about it. it is pretty cool. >> that was ceo larry baer. $17 billionber's valuation. is it justified? you can also watch us on your tablet, phone, apple tv, and amazon fire tv. ♪

>> i am emily chang. this is "bloomberg west." amid multiple nine figure financing rounds, index ventures

announced a new $550 million fund. the firm has had seven exits of $1 billion or more. i sat down with the general partner and started by asking what the fund plans to do with all of this new cash. >> it is not going to change too much, consumer internet, enterprise i.t. technology, basically the same set of companies we have been doing. the things we look for our network of, marketplace dynamic, companies that become platforms. we don't try to be too picky about which sector, because the world changes so quickly. >> there is a ridiculous amount of capital these days. how would you describe the fundraising environment? is it easier than ever? >> it is about the same. for us, we generally don't

change who has been investing in our fund. we have the same size. it is an ongoing conversation we have with our limited partners and it was not hard last time, but we still go out and talk about the climate, explain what is going on. i would say was a normal process, with the track record we have, it is never particularly difficult, but we are honored to have them. >> your portfolio is spread out across the u.s., is the environment any different? >> the environment is generally positive, investing in europe and israel is different than the the, so you don't have density you have in silicon valley. you have to be a bit more and are the companies because here the entrepreneurs are so knowledgeable about the profits of building a company and in

europe you have a lot of smart and competent people but it is not as obvious. >> is there anything exciting technology being developed outside of the u.s.? europember of things in are locally very well done, commerce is an area they have job, we havetic seen a lot of interesting advertising technology, one of our companies is a great example, europe has been a hotbed for music, one of our company comes from religion. there's a lot in music to the europeans have figured out, they definitely have verticals. >> you are on the board of sound cloud, can you tell us on the latest on twitter? >> they are a great company. the thing sound cloud is fantastic. they're delighted they are independent. >> so does not on the table.

>> we are running our business just like we were before any rumor. >> i want to talk to you about just raiseduber money, you have airbnb, dropbox, do these numbers seem fair to you? about us last time, it is tricky to interpret numbers like this. you,these numbers tell they get big numbers, but fundamentally it means the market has high expectations for them and overtime they will adjust to correct for that. there has been a big adjustment downward, which is the market correcting for being too far ahead of itself, uber is a turf accompanied. could they be the next microsoft or one of these? they should be.

you just don't know. certainly it reflects excitement. you talk about bubbles, do you think we are not in one? >> i don't think so. if you look at the way the market has behaved, you have seen significant corrections. some more than others which means investors are getting more and more knowledgeable about how to value these disruptions. so i think these companies will be worth a lot. exactly which ones, i do not view this claimant as way ahead of the possibilities of what the companies represent. third, whatranked is it going to be in 2014? us.he climate is good for we have a lot of big companies. the m&a claimant, you can never guess what happens.

have better earnings capabilities. you have to be more predict double. we hope you'll have a banner year. last year we had seven companies that exited north of a billion dollars. which is phenomenal. i don't know who he can repeat that, but we have a good country of companies. >> fox to lead its ipo. could that delete -- lead to more m&a? ipos per year,at this year was ahead of what is normal. this year we are approaching that kind of number. the markets have pushed back a little bit. the bar is higher for that ipo. >> that was michael volpi.

the season four finale of "game of thrones" is this weekend. we speak with the director about the difficulty shooting with thousands of actors over several continents, next. ♪

not forbid to relations with women. i shall take no wife. i shall father no children. but what about other activities? it is open to interpretation. >> a scene from the latest episode of "game of thrones." while it has been a dramatic season, the show runner says the finale could be the best episode ever. jon erlichman is back with us. you know, i am so excited for

the season finale. i am dumbest dated it is already over. -- devastated it is already over. >> people love the show. it is more than a tv show in a lot of ways. this is a massively expensive movie cut up into these different chunks. so they need a massive team, multiple directors. one of them is alex graves, who has done a lot of tv, he caught up with him recently and started by asking him, how does this show compared to other ones you have done? >> you can't compare "game of because it shoots on three continents, you are shooting and prepping on three continents, the entire season is written in advance, you have all of the material when you start. you can really be very firm in the storytelling in a way you can't usually be in television. eightd of there being

characters, it is 40. it is hard to compare. >> when you talk about filming, what is the with just a co-planning that goes into that? -- what is the logistical planning that goes into that? >> they have to write them in advance so they can schedule it in a way that makes financial sense. every director has a different color on the schedule. i did four episodes. the schedule,r you are shooting for six months. almost 100 days off and on in a row. and on the three continents, when you're not shooting, you or toying to prep, iceland to prep iceland when you're trying to get back to shoot something else in ireland. you are all over the place. it is very intense and fun because of that.

arehose locations where you shooting are enhanced by visual effects. ay goes toould you she cgi? locations aree not enhanced, given how beautiful ireland and croatia and iceland are. and yet there will be several episodes during the course of the 10 that require a lot of money for any kind of visual effect. did four episodes and there were very different categories of visual effects that had to be pulled off. has a lotf thrones" of supporters in silicon valley. have you received any interesting feedback from theutives who have notes on show or give you their likes and dislikes? either,he feedback is that was amazing, or so gross is usually the feedback. [laughter] >> obviously everybody is

talking about the show all the time. right now you have jj abrams on the set of "star wars" trying to keep secrets from spilling out. what is your strategy? everybody who makes the show loves this show so much that they are dedicated to it. it is a labor of love. they are very careful, and it goes both ways, i find most people don't want to know. they want to have the surprises the show was bringing them. although i was hacked when i was paris and i immediately removed everything from my computer and put it on a drive. i had like the whole season on my computer. i had to be careful. good point.es a even though you're directing you each have to

know everything going on tied to the season. correct? >> directing the show, the fun part of directing is that it is like a feature in the old studio system. they are very supportive. the flipside is you have to roadmap the narrative of not but eachstories, scene. it is very specific what story you're telling you there because of the pastor what is coming. >> you have done your fair share of john chopping episodes, with the final episode of the season, what should we prepare for? not being able to talk about the final episode in having directed six now, and being a fan of the season, i would say the finale of season four is unlike anything that has ever been mounted on the show.

turning point in the books and a very big turning point on the show. i'm really proud of it. show has been renewed for a fifth and sixth season. how long do you think "game of thrones" can continue? >> it is up to david and dan and george and where the books take us. i think david and dan will keep it as focused and tight as it has been and not drag it out. i do know enough to know there has been a lot more story that has to unfold before the climax can happen. i am dying to see it. it is almost cruel they make us wait. that was so fun. >> you raise an interesting point, we live in the world of netflix, you've got originals and yet this model seems to be working for hbo,

somehow the secrets do not slip out in a big way. excitementek to week builds and it works for hbo. amazon,ut a deal with but it does not include game of thrones. -- how good ist that for amazon? they are still hbo benefiting financially big time as the seasons unfold. even in the most recent quarter for time warner, they talked up the fact season three video sales were huge. i think there is a long runway before they have to do an amazon deal. >> i will have the popcorn out on sunday for the season finale. byte,ow for the bwest cory is with us as well. can you not wait for the season finale? >> i will have to.

1.8 billion dollars. that was the difference between hewlett-packard non-gap earnings and their gap earnings. the board decided to pay meg whitman aced on the adjusted non-gap numbers. $1.8 billion higher. allowing her to get a bigger bonus. >> what is your take on this story? it is relatively unique. >> cory has done some incredible reporting on this. is hard to not to look at something like this and say, wow. >> how long has it been since she took over? >> since september 2 years ago, i believe. the fact this company continues to take restructuring charges and that does not count when they calculate executive bonuses. to the 50,000 people laid off, this is surely calling -- gallin g. >> thank you for watching this friday edition of "bloomberg

west". have a wonderful weekend and don't miss "game of thrones" on sunday. ♪

>> from bloomberg world headquarters in york, i'm mark crumpton. this is "bottom line." today, the pentagon increases surveillance over iraq as in shirt -- insurgencies capture more towns. good,ness that is doing time.oop at a viewers here in the united states and those of you joining us from around the world, welcome. a full coverage of the stocks and stories making headlines.