pier 3, welcome to the best of bloomberg west. we breathe you cap interviews with the power players and global technology and media companies reshaping our world. for the second time in less than a month, there is a major shakeup in the top executive ranks. they have named former goldman sachs banker as the new cfo.

they lead the twitter ipo and had a varied background include being cfo of the nfl. gupta, whoes mike will stay on as vp of strategic investment. a powerre reports of struggle between himself and ceo hostile oh. twitter is also active on the acquisition front -- between himself and ceo dick costolo. what does this say about their future? i spoke to the former twitter director of hot form. i started with what he thinks joining twitter. >> i know they had a great experience with him working through the public process. he has a lot of fans inside twitter. one of twitter's biggest ruggles

is being understood by the public market and bringing someone like anthony and to help translate between those worlds will be really affect it. you imagine is happening inside twitter with all of these moves at once? the head of engineering left and they've had a shakeup in the product department. what's going on? >> it's about fighting the right leaders at the right time to help grow and build the company to expand the opportunities they have. 300 million active users and i think they could get closer to one billion. they have to find the right people to help them get to the spots. >> how is costolo regarded in the company? >> he's effective. he makes great decisions. i love working with him. >> from a culture perspective, is there anything to worry about? growingone has those

pains. they have 1000 employees and they are a public company. there will be growing pains but overall it's a healthy thing to grow like crazy. >> the biggest acquisition since mopub. down oner is doubling mobile advertising. dollarsons of baad doubling down. they work on what they call retargeting. they help get installs to bring new users but now as a mobile has matured, their jobs to build advertising products to bring people back in. if they know you want to buy something, ebay can target one of their exacting users -- existing users and bring them right in the time to buy. >> not long ago they hired a head of commerce but no one really knew what exactly twitter was planning to do in commerce.

do you have a better idea where they are going with this? >> nathan hubbard who they brought in from ticketmaster is a total rock star. he's the right guy to help them figure out. if you think about the evolution of how twitter has built out the product so far, building stuff in stream targeting at the time aey are shopping and putting button "buy now" will be a good path for them. some testing a better earlier so it would not be too far off base. >> how will this help user growth? cases forg more use people to understand how to use twitter. the more ways they can get twitter out there outside of 200 50 million users, it means a lot to them. over half ait's

billion users. it's going to be one of the biggest out there. >> one thing dick costolo said to me as it does not matter how many people are actually using see tweetsause you everywhere, i'm tv, in magazines. is that true or do they really need people to be signing up in using the product make money? >> the general tech press has misunderstood. does not like facebook. it's not just about the monthly active. it's about the one billion plus users they can reach. it's media. a part tv and it is such of culture and i think about it as bigger than facebook. you hear about it more than facebook. it is just so pervasive. >> you have been a red point now for a year. >> almost a year. >> what trends are you following? how has your twitter experience helped you pick and choose where

you want to place your bets? from's been a big change operating, for sure. there's lots to learn. you're trying to find out what motivates people to continue to engage with applications thinking about the average user has 40 applications on their phone, what gets them to log back into yours? what's the behavior? everydayyou open it up to see new real-time information. my job is to try to apply them to other businesses and see which ones can be the next twitter. which businesses look like they're going to be cool and have people coming back every day? >> that is why uber nailed it so well, public transportation and they built an incredible experience around that. finding more ways to be able to do that is really important. you being affected by valuations and what's happening

in the broader environment? are these high valuations trickling down to where you are? likes you have seen a fluctuation. in consumer enterprise, those differ a little as well. it definitely affect the valuations in an early stage and it's really important for us to still try to find the winners in those markets as they can really have outside value. >> that was ryan sarvverer at redpoint ventures. find the next big disruptive technology but what happened with the legal challenges? could what happened to area put other businesses on -- could what happened to aereo at other businesses on the defensive? ♪

>> welcome back to the best of "bloomberg west."

tv or service has suspended operations. in a blog post, they said it was a massive setback for consumers saying the journey is not done and they are busy mapping out the next step. how can investors get when a disruptive company will be a big risk or if they could lose their entire business to government regulation? capitalist a venture who has looked at these risks over the past decade. how do you make the decision to invest in companies with regulatory concern? think about drones as well. everyone chooses the market they will either create or disrupt. when you disrupt, you have regulations to deal with. chose case of aereo, they to go after the cable providers thinking there was a shot.

in the case of commercial drones, we made that out. uber.e a service like thebasically figure out risk you're going to go and tackle and hope the regulatory one will not be a risk until it is in your favor. industries they are federal so in things like finance, health care, aereo, withon, like municipalities you have regulations as well but they can take them one at a time. >> it's a very fair way to split the challenge. i would go after the local ones even though you have to tackle them one after the other. faa, fda, they are always more challenging and you hope that progress will win eventually. >> hope is not a plan.

luck involvedof in making a company a success especially as you invest as early as we do. in the case of regulation, you look at the risk. this is what has happened in the past. this is the way the agencies are looking at these kinds of progress is and so forth. aboutve been talking dahlia ration. nb, do you think any of this could truly slow them down and become a fatal flaw? >> i don't think so. they have now scaled where they can go to the governments, go to these institutions and make their case. they weree of aereo, too early, too small. they were slaughtered by the cable industry. >> you passed on airbnb.

>> when i met them they were breakfast.bed and you go to a conference and you get in their bed and you have a cheaper way. >> air beds. [laughter] passed oner -- i --when they got their valuation, you could feel the funk were everyone who passed on it was like "crap." >> what's the feeling like when you pass on something you know you could have made so much money on? >> our job is to see everything that is interesting and make a decision and hopefully we make the right decision that we make enough money for investors to raise the next fund. in the case of linkedin, over,

airbnb, they are profits on paper. linkedin is real. raised more money. we've been talking a lot about valuations and money rushing into the market drives up the valuation. you're trying to raise money saying it's not running in yet. what is the fundraising like now? mood in thehe market today where you literally funds outicro v.c. there -- when i started, there was one. it's in a different landscape. people look at the brand you have built. we've done 150 companies and this is like passing on linkedin, uber.

we have made a lot of progress with the portfolio and we have a lot of winners and what we will have invested. to look at the brand we've built and they say, yes, we want to be in the tech or a door. it's never easy to get money from people but it has been easier. >> do you think it will not end well, all of the capital taking deals right now, all the prices going up? >> you have a lot of capital chasing deals. ofhink there is a lot discipline in the series a and series b's. at the end of this, you look at the market and there is a finite amount of capital going into these and this is where the regulation is happening. even though some companies get the mean valuations, valuations have not moved up that much.

ch'sory johnson and softte founder. patent law?o change washington looks to silicon valley to help clean up the junk. that is next on the best of "numbered west." ♪ west."omberg ♪

>> welcome back to the best of "bloomberg west." to kill patent trolls died on the floor so the patent trolls live on for now but the u.s. patent and trademark office is not giving up the fight to reform the patent system. what is a patent troll? why are they causing such headaches? cory johnson has the answer. they're called patent trolls. they do not sell or produce anything. they have built patent arsenals abandoned from the stockpiles of

failed startups and defunct big tex companies. once they build the war chest, they go out for blood targeting companies whose technologies are similar to those outlined in the patents. they threaten costly lawsuits fees are given. of the 4700 at the lawsuits filed, 3000 were from these so-called patent trolls. also spoke about ways to fight trolls with the deputy director of the patent and trademark office. i started by asking what she sees as a fundamental problem with patent trolls. a pretty complicated question. the bigger question to ask is what we can all do to better improve the patent system and make it the best it can be. there are lots of initiatives being undertaken by the courts,

by the congress, and also by the administration, by the patent and trademark office. happy to go into those into as much detail as you like. on theou have worked apple microsoft case which was so important here, but how do you explain how different things are now than they were 10 or teen years ago? just as companies are innovative as they have always been a. been an uptick in patent litigation and also abusive litigation so the goal of the administration and the help curtailo abusive patent litigation and create a system that promotes and encourages innovation. >> what kind of litigation is abusive? where young a patent have no ownership rights and stretching the meaning of what it covers. using a tact where you send

demand letters to a lot of people and you are saying, don't look too much into the details. you can settle this litigation for just $3000, a lot less than it would take to hire a lawyer. we are undertaking a huge make this clear. the less ambiguous the patent, the less the likelihood of that pattern being used in a piece of litigation and the more likely the companies are able to focus on innovation. >> how do you make the patents better? it is coaching your people so they can do better patent examination dan pointed out patterns that are weak? the examiners are very hard and do an excellent job searching. however, we are using silicon valley techniques such as crowd sourcing. we are going out and asking experts to say, look, you are experts. what do you think are examiners should be looking at as they

look at whether or not a patent should be issued? we're also bringing in experts from the industry, from academia. we have some of the best experts in the world that said outside the walls of the pto. >> how do you bring those people in? lecture onne hour whatever your area of expertise and give that training to our advisors and we will broadcast it. smarter examiners who are up to speed on software and technology leads to better quality patents. it's a complicated issue and there are many factors. the key is what we want is to curtail patent litigation. we also want to reserve the rights of the legitimate patent owners. the balance that with a set of reforms promoting innovation, there are a lot of issues at stake. legislation has stalled. we are not waiting to move forward.

we have a number of initiatives underway. we have crowd sourcing initiatives. we are tapping into experts in the field. we are also using big data. u.s. pto has a lot of data. we are really beginning to and are able to go over that data, review that data, feed that back into how they are reviewing the times at every phase of examination. >> there was a time when patents were not seen as such an incredible, obvious patent challenge. president obama highlighted that in the state of the union. let's listen to what he had to say. >> let's pass a patent reform bill letting our businesses focus on innovation and not litigation.eedless >> i wonder if the 20-year time frame of patents needs to change now because innovation happen so quickly.

>> that's true. innovation occurs quickly but there are many industries for which a 20-year term is absolutely justified in needed. andexample, biotech pharmaceuticals put hundreds of millions of dollars investing into developing and getting it the a approval and in order to recruit investment, they need longer-term protection. >> longer than 20? enough. probably long they seem to be operating just fine. time ofeed a certain exclusivity so people take the risk so that they can then have the opportunity to recoup investment. >> cory johnson with deputy director of the u.s. patent and .rade office michelle lee the company facing scrutiny for ads promoting the reelection of syrian president bashar al-assad. we talked to the group demanding the social network it back or donate money it made from running those ads next on the best of "bloomberg lwest."

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>> you are marching the best of "bloomberg west." facebook is under scrutiny for running ads promoting the reelection of bashar al-assad. they ran for a few days before the site took them down. in response, they stage a ortest demanding they return donate the proceeds from running the pro-assad adds. them asking how the protest went. likes it was good. people in the offices in the facebook building were showing the thumbs. people are very sympathetic to

the question we are asking facebook. regimeng such a terrible , the thing you should be doing is making it right. toing the profit you've made promote an atrocious regime, give that money back to the people to those who are in desperate need of food. >> we reached out. they took the ads down. they don't know who paid for them in the first place but the money did not come from syria. they did not feel like they were breaking any laws. likes anyone who knows a little bit about this regime knows that their tentacles spread far and wide. they live in paris, new york, and london. they still cannot speak out against the regime.

element ofto be an the syrian regime. i think it's a little disingenuous for facebook to suggest the money does not come from in some way an element of the regime. you got the visual like a button outside the office that thismazing to me campaign had some effectiveness to it. likes it's a crisis and the conflict of this scale. they believe the world has .orgotten them the idea that facebook can do business that promotes the regime using starvation as a weapon of war dropping bombs over schools and hospitals and took theaying we

ads down but we cap the prophet, this is an opportunity to show solidarity. this is unacceptable business. likes what does this tell us about the assad regime if they are behind it? .e don't know for certain what does this say about their in theirchnology condemnation of syrian leadership? >> this was during the time of the sham election. the ads are primarily focused outside of syria. it was an attempt to legitimize the regime and legitimize the election. if you look at the reporting, the world is talking about isis

and iraq. the assad regime is responsible for the majority of things that .ave unraveled there should be an uproar, rightly so. we are just astonished that assad who is responsible for most of what's happened in syria, has been able to advertise and facebook make money and hold onto the prophet. >> john jackson with my partner cory johnson. google will have to face a thes-action lawsuit after street view data collection after they refused to consider the appeal of a lower court .uling the plaintiff accused google of collecting e-mail and user names . they said it was a mistake but insists that they did not violate federal wiretapping

laws. cory johnson and i spoke with electronic privacy information center president and her. how bad a situation is this for google? serious decision for google. the supreme court left in place that they violated the wiretap act. street view was supposed to be alsog pictures of houses capturing wi-fi communications and when people learned about that they charged they were violating federal wiretap law. >> it sounds like they were collecting eight usernames, images, documents, all unencrypted. >> they would have cars patrolling the streets not only in the u.s. but the world. they were taking pictures of everything around them.

they were also secretly gathering wi-fi hotspots, not just locations but the actual ip addresses of some of the devices. they want to know what pewter you were using, your home router ip address was and where it was physically located. even to the point they wanted to know and were able to determine usernames of the actual devices running them. courts on both sides of the pond have declared this act to be illegal. >> they said it was a mistake. did they say it was an accident? >> they did not. this was a very planful thing of theirs. in so many instances where google has been involved in gathering and sharing that ,nformation with the world think of the original mission statement. every google employee since the beginning of the company has been on a mission and was

to make itined universally acceptable and usable. some of that information does not want to be gathered. if the personal missions eight this is to go out and do thing, they will run into these problems and they will have to address it. the consequences here? hearing this class-action suit, what are the consequences? what attachments could google face? >> this was a class-action lawsuit which means that many people have been brought together to bring the claim that the supreme court has left in place the legal basis meaning that google could look at very substantial monetary fines. i think it's unlikely they will go to trial in a case like this. the facts are not favorable and it will be pretty easy to show

that the wiretapping act of it he alleged had in fact occurred. with the legal basis for the claim well in a place they would almost certainly prevail. the two parties will sit down and tried to figure out what a reasonable amount is for the various claims. >> many look at all the acquisitions over the course of the last six months acquiring satellites that can send signals , do those kinds of things, , nestingilitary robots this and drop cam, what does this mean for other google projects? does this make other acquisitions less profitable or unable to use them in ways they would have otherwise an inclined? good reminder that there are actually some boundary

lines out there for google. a lot of the data collection they are able to do as long as it is internal, but when they are violating the wiretap act by collecting through wire itnsmission, then clearly will cause liability. they will have to pull back a little bit and look at what limitations privacy laws are chosen. this is not necessarily a bad thing. presumably, they are protecting important interests. we want to be able to use our routers without worrying that others will be intercepting our private communications. at the same time, they should be free to innovate. we will have to allow companies such as google to innovate while respecting these important safeguards.

can you create a powerful story using pictures, video, and your ipads? promises to help you do just that. it's already won design awards from apple. the ceo joins us next. ♪

>> welcome back to the best of "bloomberg west." content on consume the ipad. now there is a new app to help people create content. it's a visual storytelling app, one of nine that won an award. storehouse ceo and asked him, a former apple

designer, how people use this app. made up ofe stories photos, video, and text made up together. beyond aed to go single photo but also did not necessarily want to write a blog int and kind of lay them out an interesting way. >> is it an extended version of imovie? >> and allows you to create something more like a magazine article. allowing video in their ads the multimedia element. interesting. ipad sales are dropping. you guys are only on the ipad. is that a concern? >> we are looking to move to other platforms. we are bullish on the ipad. when you look at the younger generation and the way that they've adopted it, we are hopeful this is a device that will really change a lot and open up creation for a lot of

people. >> you have a unique experience because you were at apple for eight years. you were a user experience evangelist meaning you help other companies develop apps for ios. thing i did was really try to help people take advantage of apple's technology and unique hardware, to really push the boundary of software design. we wanted to really think about what publishing could be on an ipad really thinking about the large touchscreen and a really fast graphics buffer. >> people are using this and really unique ways. >> from earl's night out collage of photos -- from girl's night out, but some of the more interesting uses of have been award-winning photojournalist using it to document arctic expeditions and deep photojournalism stories, cooking recipes, do-it-yourself stories.

that's been the most exciting part, the variety of stories told on the platform. design withomes to apple, what do you think about ios 8? base andet down a nice 8 follows up with a lot of polish that maybe was not there 7.ios i'm hopeful that things are going to get better. >> you think the coolest features are not there yet. what are the coolest features we don't know about? >> the developers conference focuses on what's behind the scene. we have not seen the big unveiling from the consumer standpoint. a lot of talk about other types of things that are really exciting. since i'm not at apple, i don't know. i'm always hopeful and excited for my former colleagues. >> there's been a lot of talk about the state of innovation that apple. how optimistic are you that they've still got some more

great world changing products in them that are coming soon? >> i'm very optimistic. my friends are excited. they are very quiet, which means they are working hard on a bunch of different things. recently raised $7 million. how will you spend the money? a we are looking at building world-class team, engineers and designers to expand to other platforms beyond the ipad. we want to get to the phone and the web as well. >> who are your main competitors? >> there's not a lot working on photo storytelling. there are some working on storytelling for writers and the web, but we are not seeing many other apps doing the same thing on iphone and ipad with modi storytelling. the senior vice president at oracle talks about his second love in life, setting off

fireworks. he even has his own factory and has created some of the largest this lays in the country. we meet him next on the best of "bloomberg west." ♪

>> welcome back to the best of "bloomberg west." the world cup has been a ratings success. the first two world cup games for the u.s. caused service destruction -- disruptions. surveymonkey for this month's shakedown. dave, who has been to three world cups himself, what's so special about this year? why are so many are tuning in? >> soccer is seeing more interest and it is actually a head of the golf in what people say they are watching. that might be skewed by the fact

we are asking in the middle of the world cup. >> and tiger woods being hurt. >> golf is definitely on the decline and soccer is on the rise. it has a long way to go before it catches up with football. huge spike in viewership. >> every world cup has seen that. the numbers for the world cup, i think, have kind of blowing people away. it also goes to show -- this is not in the survey results -- but soccer with all of that passion those kind of excited americans. the mls, when people are answering if they watch soccer, is not quite that for people. soccer fans tend to watch more online. it's a very small amount. it was 4% versus 2% for other fans.

because they have to find the manchester united game streaming early in the morning or something like that, they have to search for it. >> i just got a number from nielsen on the ratings. million, english-speaking networks, up from 2010 with 2.1 million, a 46% increase. streamings more because the games are on during the day. it's not just technology but the fact that i'm at work. >> we are all trying to figure out how we are watching it. >> the timing of it, we still found that most people watch sports on tv. sports is on at night and it's easier. device.k about your it's a long form content, a lot

of streaming, a lot of battery and data usage. surveymonkey ceo dave goldberg with my partner, cory johnson. while most of us only think about fireworks on the fourth of july, some people like oracle's mike workman thinks about them all day long. he's a senior vice president of hardware and software development. fireworkshe's in his factory in the arizona desert. he has curated some of the biggest fireworks displays in the country even designing a special show for his boss, oracle ceo larry ellison, over the san francisco bay. take a look at this unusual hobby. mike workman, senior vice president of hardware/software development at oracle. you can find me out here in the desert making fireworks, blowing things up. i started making fireworks when

i was just a kid. when you are 12, you cannot be serious because no one will let you. as i got older, i could afford better equipment and chemicals, the raw ingredients. fire in the hole. as a lot of parallels between developing a product and developing something people like to see in the sky. audiences like loud noises, different kinds of textures, , sometimesrks different intensity. they like a lot of things going on at one time. when i explained i make fireworks, they automatically assume i'm not. that's partially true. it takes a lot of courage. dangerous, high-energy materials. one thing that's fascinating to me is it is a blend of art, chemistry, engineering, physics. it is the energy you are able to control for a short time to make something very pretty out of

something that is very powerful. i think most people like watching fireworks. it's universal. some people get emotional. i personally get very emotional if you take very good music with an artful display with timing and colors, it does something. i like to see what i've built and what i do in the sky have the same effect on others. ♪ alarm] >> oracle senior vice president of hardware and software development mike workman. that doesn't or the best of "bloomberg west." you can catch us at 1:00 p.m. and 6:00 p.m. eastern. we will see you next week. ♪

>> help wanted. the u.s. cuts the jobless rate to precrisis levels. dowell tops seven -- end and the dow tops 17,000 for the first time. i am angie lau. mobile, and your bloomberg.com. we begin with positive cues