♪ >> live from pier three in san francisco, welcome to "bloomberg west," where we cover the global technology and media companies that are reshaping our world. a new report says apps are crashing in ios 8, more frequently than with ios 7. and another step forward for elon musk and spacex. the spacex dragon capsule has just docked at the international space station on its first

mission under nasa contract. getting a big boost to the rocket company, and from rockets to drones. google is gearing up with drones in new mexico, to deliver the internet in rural areas, also investing $15 million in research and development labs in new mexico. and to our lead, the latest apple operating system, ios 8, it is supposed to be an update. but they are crashing.

older phones are having trouble processing. the health care app due to a bug. and our reporter, world research. and i will start with you. what exactly is happening? i have an iphone 6, and it has been fine so far. >> it is about 60% more than last year, your whole workforce working on something, you may want to wait for an update or a two. >> a microsoft release. >> anything in particular? >> facebook has had a lot of crashing problems. dropbox, and you will see the updates rolling out. the new ios has about 4000 new features.

i think this is what developers have struggled with. >> and you have got some research out showing that samsung is losing a lot of people to apple and the iphone. what have you found? >> last week, late last week, we surveyed a population online to see about the folks who were going to be buying the iphone, and we found that 27% of people who currently own a samsung are actually going to make the jump over to the iphone at this point, and that is surprising for two reasons. one is that samsung has a nice set of programs.

even with things bugs and being so loud, the iphone 6 is clearly the x factor. >> i was really surprised by the defection from samsung. a note with a bigger screen. maybe using it in the same way? >> and helps make that switch a little bit painless. but i think there is the coolness factor that apple has. this is a must-have phone. >> what about the current ios issues? >> another one they had was with

the health kit, the fitness tracking. that was never even released. they found it before he was put out by the public, and they are hoping to have that by the end of the month. >> more upgrades available. you wrote this wonderful story about the bug team which was like a swat team to fix any problems as soon as they appear, and this rash of problems. >> i am just trying to put it a little bit into perspective. it is 3.6% in the big picture of all of the apps. >> i will admit that my facebook app on my old phone -- >> mine was not working. was yours working? >> mine was crashing. i stayed off facebook for a while, basically. >> and these are apps that certainly people use very, very frequently, so any problem they have is a big one, and some

developers have been not too pleased with it. >> i was being facetious, but i wonder if some of those companies working on the iphone, if it is a material part of their business for revenue, they might be facing some headwind. >> you have got to reverse it, as well, in that a lot of developers raced to get out with the latest software, and, perhaps, don't do all of the crossing the t's and lower case j's. >> is it a developer issue? >> i think it is probably both. this was a big release for developers.

more than 4000 different tools that they needed, and if everything is not working properly, then this will happen. >> all right, from bloomberg news, and with new research out from mcnealy, and let's turn to the management shakeup at one of the largest enterprise companies. oracle has just released a proxy statement, describing a leadership change at larry ellison steps down as ceo and mark hurd and safra catz share the role. jack clark covers oracle, and, jack, what exactly new did we learn about this relationship between them today? >> well, not only has there been a huge leadership change, but the performance stock units, that means they need to get a good amount of operating cash flow compared to many of oracle's rivals in the business world, and that will contribute directly to their compensation. also, larry ellison is under the same scheme now. a big change.

>> they are herding cats over there. have you heard that one yet? i wanted to say it. >> they have been herding cats for a long time. safra is a tough person to herd, i am sure. and the thing that jumped out to me is hurd and catz are both making a lot less than the previous year, but still more than pretty much anyone else in technology and corporate america. >> well, it seems like a return. oracle has been under shareholder pressure for several years now to reduce the amount of compensation it pays its executives. that has been seen as being very, very lavish, so to bring oracle back to the level of other companies while still making them extremely wealthy.

>> so let's talk a little bit about mark hurd paid more than safra catz. i know it is not that much more. >> hurd is cfo, and she is not. it is noticeable, particularly when they have this issue. >> catz has been there since 1999. >> indeed, she has, and she has done a heck of a job. a $2000 difference when we are talking about $37 million. >> we are talking about principle. >> yes, we are, and their salary and their bonus is the same, but it is mostly stock compensation, but i think the bigger issue is just how big these numbers are. when you look across some other companies who pay their ceo's tons and tons of money, this is tons and tons and a couple extra times. that is the thing here. and, jack, you have said that some people have complained about this as shareholders, and shareholders also get a vote on this, and they have repeatedly voted for the leadership they have provided for the company.

>> they have repeatedly voted, but you can like the leader while also saying i think you are drawing a bit too much from the accounts that your company is generating. i think that is what is going on here. in many senses, oracle executives to make significant amounts of money, and i think by adding performance, they can make it feel more fair to the shareholders, and they can still make the money, tied directly to the oracle performance.

>> is there anyone else out there besides me that is saying why is safra catz not getting paid more or at least as much? >> it is $2000, of an extremely large pot. i think there is something obscure and strange there. >> fundamentally, what this is about, and this is an interesting thing, a lot of companies, a one dollar salary, and there is lots of other stuff, and meg whitman is one who comes to mind, taking tons in compensation and bonuses, and what we see here is other compensation, and quite often i can lead to something like use of a private jet or insurance to an executive or security for their home, for which larry ellison was provided more than $1 million last year. only $2000 more, but their salaries and their bonuses were exactly the same. >> all right, jack clark, who covers oracle for us, and cory johnson, as well. coming up, google added alec, a organization that denies climate

change, as a real problem. and be sure to catch my interview with the oracle ceo tomorrow, bloomberg tv, a first crack at them as they unveil a new phone. ♪

♪ >> welcome back to "bloomberg west." i am emily chang. president obama addressing climate change, and eric schmidt admitting it was some sort of a miss they to give support to alec, an exchange council which opposes u.s. action on climate change. your organization protested the google involvement. what you make of the statement of eric schmidt today? >> i think it was the wrong thing for google to be doing. they were not aligned.

so we are very encouraged. >> it makes sense to me that they would support it. it makes sense to me that exxon mobil supports alec, but it does not make sense that google is getting involved with the group that is opposing climate change. why is google involved? >> that is a great questions for google. >> you have been suggesting they ended that relationship. >> you're a company that wants to have interests, and alec is an organization you probably think about. but the problem from our perspective is while they may align on some policy, like immigration policy, trade policy, or other kinds of things, they are off when it comes to climate change, and the good news today from google is that they have put climate change high enough up on their list that they have disaffiliated from the group.

>> google has ended its relationship with alec as a result of left-leaning associations. how do you respond to that? >> well, the american legislative exchange council has not been shy about their position on climate change. if you look back at the draft legislation may proposed in 2009, it suggested keeping climate change as a theory around the country. that is not about free market. that is about misinformation. and google, of course, recognizes that. >> does this go beyond this?

-- beyond alec? are there other things that google is doing in statehouses to support climate change deniers? >> google as well as others are heavily invested in the political contribution in washington, d.c., so google, for example, contributed to climate change deniers in congress. this is since 2008, so there are additional steps that need to be taken. they were very clear that they need to make sure that they need to align with that view. >> and they have not had time to get back to us. this is on twitter and beyond. >> all right, thanks so much for joining us. >> thank you. >> one of space's biggest stars with jeff bezos and elon musk. next. ♪

>> welcome back to "bloomberg west." i am emily chang. spacex has docked at the international space station, with a 3-d printer and even 20 mice who will live up in space for research purposes. this is a resupply mission under the spacex contract with nasa. and elon musk will have company. the jeff bezos company announced a government contract of its own, in partner with an alliance to develop an engine for its rockets for space, and it pits the two tech titans against each other, and what impact will jeff bezos have on the future of space? joining me is the former captain of the international space station himself, and, chris, you have experience in this space

-- in space with the dragon capsule. you have met jeff bezos and elon musk. >> i think it is a really good set of circumstances. what we need more than anything else is better engines. we are so limited by our engine technology, trying to safely get to space and then trying to get even further in the universe, and we have just been making small modifications to existing engines, and that is really what both of these two organizations are working on, and that is what nasa is helping to pay for, better engines, and i am excited that some of the best entrepreneurs of our time are working on this.

>> but they are also huge competitors. can you explain who is doing what and who might be doing what better? >> sure. the engine that jeff bezos and his people are working on in partnership with the united launch alliance, a are looking at cutting their reliance on a russian engine that we have been sort of partnering and subcontracting and using for several years. they are looking at an american-made next-generation type of engine, and jeff has brilliant people working for him, so they are really working on that piece. on the other side, spacex, elon musk, they have not only built a new rocket ship, but they are building space ships as well,

and it is like the one that just a docked at the station, as you mentioned. but what elon musk is looking at is how to make a launch rocket reusable. how to have the rockets been obvious that light come around and land again, and if he can successfully do that, then he will cut the cost factor of 10, maybe a factor of 100. both of them are going to take us in the direction we want to go, so i think competition is great. >> talk to me about what that means in terms of opening up the sort of idea sharing between all four of these companies. >> well, the real difference is in the past, nasa has told companies what to build, and they built it for them.

now, nasa is saying this is the product we want. you can build anything you want. it is the difference between holding a car in renting a car, and that allows a lot of freedom, and we have got a couple of different camps competing, which i think is a good idea, and i think the way nasa has done it is good for the nation. and hopefully we will not end up with just one winner but two different ways to get to the station. we have only had one way to get people to and from the space station, which is never a safe carton of eggs to have all of your locked in, like we have been doing for, gosh, the last three or four years. >> in your experience having worked with the spacex and dragon, anything related to safety, perhaps, that is different than just nasa? >> when i sat on top of the rocketship, you are counting on tens of thousands of people that you have never met, and little companies that help build all of the parts, companies you have never had the chance to visit. that is why you need a really good, strict set of rules. you need oversight, requirements, and then you need to make sure that that vehicle

you are riding is tested properly, so there is always that concern. test pilots and astronauts are passengers. they will be very involved. >> we have to leave it there, a former commander of the international space station, thanks so much. ♪

>> welcome back to "bloomberg west," where we focus on technology and the future. will the search giant be given a green light on this from the fcc? an equity analyst and our bloomberg contributing editor, and joining us from melbourne, australia, a ceo with a company working with drones themselves, so, chris, what do you make of the fact that they want to build these drones in new mexico?

it looks like chris is having some problems hearing us. paul, what about you? this is just another space for google trying to be involved in drones? >> there was the idea of using balloons to create a mesh fabric for wireless networks in underserviced areas. i mean, you know, the problem is that the drones, in particular, the balloons have this idea that they stay up, and drones do not. they have a tendency to fall from the sky, and we have not done well so far in creating long-lasting drones. it is interesting to see how you create even a qualified

permanent one. >> and is a long-term project. it is a risky project, but this other project, we have not heard a lot about it. what do we know how that balloon project is actually going? >> a little bit. we know that initially there was the idea of doing this for wi-fi specifically, and then we figured out that that was not working well for hosting and power reasons, and they have gone to using the lte, sort of latest generation cellular technology that most of us are using on our androids and iphones, and this is continuing, but we will see wireless cars before we see the balloons.

>> facebook is also trying to provide internet everywhere, who wins? google or facebook or someone else? >> i am not sure what they are winning here. facebook and google causing each other to spend an inordinate amount of money, but my guess is that google is probably in a better position to do this just because they have been doing these risky projects for some time. i think the bigger question is is it really just in service of bringing connectivity to underserved areas, or is there really something else going on here? a data collection, and, again, i think google is in a better position to and if it from this. >> let's bring back in the ceo of another drug company. what do you make of this? first, it was delivery drones. now it is internet-providing drones. how successful can google be here? >> the fact that all of these big companies are getting into the drone industry, it is extremely valuable for any of the startups that are actually working and building products. i think that on the wi-fi axis side of things, there is the equipment required to actually make that possible. it is heavier than what you would need for data collection, for image collection, for example, satellite, but there is one company that could solve it. to actually invest in technology to create new things, miniaturized wi-fi technology

and put it in the air. >> this is mostly banned in the united states. do you see regulation catching up with what these businesses, google and amazon, what they want to do? >> we have been working closely

with the faa. we just filed to work exclusively with some companies across the entire nation, and i think working with them directly, there are the unique innovations that are not really, you know, out for the public. or which has a path for development. and i think this is for that, so that all of these companies can work on their projects and eve all the technology and make it possible for these commercial uses. >> what about safety? what about traffic control? should we be worried about those kinds of things if, indeed, drones are used for commercial purposes? >> oh, absolutely. i think you see a lot of videos today with things dropping, and it is in a very young stage. we know that none of that is going to be possible, and the real big question for everyone is how to have a network of these things working together in a very safe manner, and this is why nasa is bidding involved, and we are cooperating to build an air traffic control system for small drones, and we are doing very close work with air highway, which is building a protocol, so that rather than having multiple ones around the world, you will have one standard, almost like not having multiple internets, but one simple internet that we can all linked to, and i think the faa is going to be working closely with what nasa is working on and

what air highway is working on to standardize this. safety is obviously the paramount, most important thing around this. >> standardized drone highways in the air. that could be in our future. the ceo and our bloomberg contributing editor, thank you both. well, as the world goes mobile, new tools to meet customer

demand. we will be back to look at a tech trend, next on "bloomberg west." ♪

♪ >> i am emily chang, and this is "bloomberg west." high tech is coming to small businesses. cory johnson, our editor at large. an interesting story from the newsroom. >> yes, cutting edge technology. the change in work and the giant private sector and the business world, it is fairly interesting, and in the tool your places like invoices. one ceo joins me. you called me and told me about invoice to go, and i said, "what, invoice to go," but this is a huge business.

>> the product is an application that is generally used to let people may be a two or three-person business, maybe a plumber or a freelance designer, who wants to be able to have the peace of mind when the work is done, they send the invoice, which is the first step in getting paid. that is the value. if you get your invoices out faster, you get paid faster. >> when you look at this, the ceo of a giant business, and having a look at a lot, what do you see that makes this special or an opportunity not yet realized? >> it was already being used by so many businesses around the world. we have about 100,000 paying subscribers in many countries, and what they were already telling the founder is that they love this product. it was simple. it was quick to get going on, and it saved them time. we surveyed them, and they say they save three hours a week and that they got paid seven days faster, and when i saw something that helps small as mrs. with cash flow, i knew it was important to get involved. >> what is special about this technology it is not impacting

technology. it is impacting every business, but small businesses are with the cutting edge items. >> exactly, and when i look around and think about every small business around the world today is using a paper and pen to do a handwritten invoice, and

they give you the pink copy and keep the yellow copy, it is inconvenient for them, and it is really inconvenient for the person who wants to pay them. who wants to receive a paper invoice? nobody wants to do that. this has cash flow improved by invoice to go. >> and getting a piece of each transaction, but how do you guys get paid? how does it work? >> we are a premium subscription model. >> you get the first couple of invoices for free. >> basically, you can go to the app store and download it for free, and you can send invoices for free to try it out, but then after you have tried it out, we will give you the opportunity for one of our price plans, and it starts at $60 a year, and

people want to pay for that because it saves so much time and get them paid faster. >> the electrician, the plumber. it goes straight into their bank accounts? is that the secret sauce? >> you hit the nail on the head. this goes straight to the bank account, straight to cash. >> and they do not think of this as a separate accounting function. accounting is something they do once a year for taxes. this is how they manage their taxes, and it helps faster. >> buying into this deal quite a while ago. >> yes, our series financing, and i co-invested in that, and they are such a great partner, because they were able to help find this company in australia. the amazing founder of the business build this up, and he bootstrapped it until this year, and they connected with him. >> and making the silicon valley set up. thank you very much. invoice to go. who knew, emily? >> all right, cory johnson, our editor at large, and i want to get to mark crumpton, but, actually, we are not going to him now. in fact, we are going to what is coming up next on "bloomberg west," and that is that every tech company makes mistakes

along the way, so how about avoiding disaster? next, and you can watch a streaming on your tablet, your phone, bloomberg.com, apple tv, and amazon fire tv. ♪

♪ >> welcome back to "bloomberg west." i am emily chang. so much going on in the world today. >> the pentagon says it believes that individuals plotting a terror attack in the united states were eliminated overnight in syria. the pentagon says this is major of a network of al qaeda veterans. the u.s. centers for disease control and prevention estimates

that could be as many as 1.4 million new ebola cases by january, unless more action is taken. the government renewed actions. this includes a $1 billion commitment from the u.s. and ratings are slipping, including last night with the bears and the new york jets. this comes as the nfl has been criticized for allegations. >> thank you so much. they said there probably was a lot of pot smoking going on, and it could have been snarky. instead, he made a joke. tweeting out working my way out through a giant bag of doritos. i will catch up with you later. but it seems to have had the right effect, showing the human side of costolo, but not all get it right, and sometimes the

wrong response could lead to a pr nightmare. how should someone show a vulnerability? the yahoo! chairman, formally a chairman currently on the board of salesforce. so was his response the right response? >> it was funny, and it mediated the situations. it did not get out of control. >> at the same time, he was talking about mismanagement of twitter. thiel, management has gotten better, but that has got to rattle a ceo. what is going on at twitter or in the mind of dick costolo?

>> i don't know, and i may be the wrong person to comment on that. i tend to only comment on things i have an inclination on. >> but when someone criticizes your leadership, it is your leadership. >> someone is always criticizing you. you have to find out if it is just one voice in the wilderness, and you need to be able to address it and listen to it. sometimes you need to listen to it and modify behavior. sometimes you need to listen to it and explain. sometimes you need to ignore it. >> ace limited explain behavior, the ceo of snapchat, the e-mails that were published that were very derogatory, talking about drinking in college, and he apologized, saying he was horrified that his e-mails were made public, and no excuse. he said i was a jerk to have written that. and in no way reflects who i am today. >> oh, my goodness.

i think you did a great job of opening up to some bad behavior, but there is no excuse for it. and compartmentalizing it, at a time in his life where he does not have quite the maturity that he has now, and try to separate that from how we is now and how he behaves now -- >> is an apology enough? >> i think it is not always enough, and you also have to have good behavior. >> i do not know if he could ever apologize. as a human being. >> oh, my goodness. the whole thing. there is no way that women should ever get abused, and it happens over and over again, and that is something we have to fix in society, then maybe the only thing coming out of this scandal is paying more attention to this. >> what do you make of the response of roger goodell? has he been apologetic enough? >> i do not even know if the apologies are enough. we need to see change in the nfl and have the behavior get fixed, and controversy over whether he saw tapes or the nfl knew, i think there was something about how truthful is everybody in this, and how well-managed is it going to be, glossed over, instead of fixed, and i think anytime you try to gloss over something, most people see through that very easily. >> so you think the best

strategy is to comment? some will choose not to comment at all. >> i think it depends. it depends on what the situation is. and sometimes you might be in a quiet period, and you are not able, and the noise builds, and you feel very helpless, so there are all kinds of times when not commenting is appropriate. i think it is just a judgment that you have to use on what is the situation, is it better to tell the truth, which i think it is always better to tell the truth, and how much explaining do i need to do, how vulnerable should i be. i think people give a lot of credit to people, like showing he was not involved very well as a young man in college, and he owned up to that and said he apologized and deeply regretted it, and hopefully he gets a chance to prove that he is a much better man today than he was.

>> maybe he should be taking some advice from you. always great to have you on the show. time now for the bwest byte, we refocus on one number that tells a whole lot. what have you got? >> how about 99.7%? firms with fewer than 500 workers make up 99.7% of all u.s. businesses. the technology of making things like the invoices better, 99.7% of businesses can get these sort of effects of the latest in technology, benefiting, maybe for the first time ever, and i think the impact on business and globally are just so far-reaching. >> right, and even yesterday, we were talking about something as simple and the now as human resources and a technology company that is trying to streamline all of the human resources, and it sounds so boring, but actually, it is kind of important. >> it is boring until he cannot see your doctor or get a paycheck or get your invoices paid or pay your employees or fill your truck with gas. that is how interesting these

little technologies are spreading out to businesses all over the world. >> all right, cory johnson, our editor at large, thank you very much, and thank you all for watching this addition of "bloomberg west," where you can find a streaming online, your tablet, bloomberg.com, and more. ♪ >> let me ask you a question.

how much money are you paying your cable or satellite company to watch tv now? >> over $80. >> we will let you in on a secret. one that cable and satellite companies ot