i wanted to start with this one, given the anniversary of

netscape. when i came to silicon valley, i thought i had missed all the opportunities, fun, excitement. it felt post-apocalyptic. when did you realize you were wrong? >> it took the internet taking off. silicon valley was on fire. with companies like oracle taking off, microsoft and so forth. the valley crashed really hard in the late 1980's. the thing i learned was, the number of people who were unbelievably talented, who had been through the pc revolution, who just didn't have -- there was no real thing for them to do. the minute there was something to do, they all said, i want to be part of that. >> for someone who comes to silicon valley today, have they missed all the excitement?

>> there is no way. it feels to me like 20 years of progress with the internet. we are just now getting the payoff from the hard work. >> ebay and hp recently decided to split up. you said they made those decisions independently. why is this happening? >> my view is there is going to be more fundamental industry change in the next five years than in the last 20. every technology company more than 20 years old will almost certainly break up. thinkl take time, but i you go right down the list. >> you mentioned oracle. >> they are all super cheap. view is this conventional -- even google and apple are trading at low level pe's.

arebig ones, some of them trading at single digits. alot of these companies have tons of cash on the balance sheet. the activists come in because the companies are cheap. the other side is that the industry is changing so fast. if you're a big technology conglomerate and you are in all in these different types of business, youo have competition from all these new startups. the industry is changing. it is a sign that there is the opportunity to do more and better. test for a technology company is, how do they make sure they stay on the leading edge? >> from a leadership perspective, we have seen larry is there ap down,

changing of the guard happening here? >> oracle, i think it is possible that nothing has changed. i think that might have had more to do with the number of papers larry has to sign. but he does still have product development. >> how do you see the digital payments and mobile payments race playing out? >> it is the thing that will have a big impact. the combination is going to cause enormous change.

>> let's talk about the next generation. you sounded the alarm about startups. bear with me. new founders in the last 10 years have only been in the

environment where money is easily to raise. that will not last. when the market turns, and it will turn, we were find that many companies will vaporize. there are exceptions to all this. if you're reading this, you are not one. and then a single word, worry. what are you worried about? >> it has gotten easier to raise money. as a consequence, you get used to being able to raise money. you get to be able to raise money at a higher valuation. if you fly to europe, you can raise it. if you fly to asia, you can raise it. then you find yourself in an -- in antarctica looking for investors on the fringe. it gets harder and harder. if you can't raise financing, you go bankrupt if you can't raise financing. you have to do a down round. that could be damaging to a

company's more row. >> why stopped short of using the word bubble? >> we don't think it is a bubble. >> every bubble that has been called a bubble was by historians. you always had a frenzy. you had the shoeshine boys are taxi drivers hyper enthusiastic. valuations are running hot. i think it has more to do with cash burn. how much money you are raising and spending. >> how does this play out in your portfolio? you are an investor in airbnb, which has a $10 billion valuation, pinterest. how are you balancing making those investments and practicing what you preach? >> to be clear, our companies are the exception. [laughter] one of the reasons i said what i said is that this is the same conversation i have with all her -- all of our ceos. it is a precautionary

conversation. it is not a conversation that says stop spending, have smaller goals, it says be aware. learn from history. have an appropriate sense of risk. airbnb is an example that is a commercial success. the business is growing fast. it will be gigantic. there are other companies where it is a little bit of a balance. extravagance is a little bit over the top. when you are burning $50 million a quarter, maybe not having bruno mars play a concert. [laughter] maybe we can have regular water not coconut water. we all love the coconut water. it is a human right in san francisco. [laughter] maybe the masseuse can come in on wednesdays and fridays. it has gotten to be a bit much. there is a high correlation in building a font see -- a fancy

headquarters and falling off the cliff.reas -- off the the alternate model is the amazon model. if you wanted desk, it is a recycled door. we are much more on the side and tammy --tamp down a little bit. you called him evil captain kirk. >> you had a's. exchange with carl icahn last week. do some of these activist investors have the same concerns as you? >> they are a result, not a cause. they are a consequence of companies being very cheap on the stock market. they are a consequence of companies needing to restructure. it is a little bit of a sideshow. >> is there a disconnect? is there a fundamental misunderstanding? >> in the long run, there is not a misunderstanding. >> i'm curious about your thoughts on payments. it is area wide open. now you have apple pay, google

wallet, bitcoin. how do you see the digital payments and mobile payments race? >> this is a big thing. the system has not changed in 20 years. this is another area where there will be more change in the next five years. there are two big drivers. one is apple pay. and there is bitcoin. apple pay is the thing that is freaking out all the financial services. apple is showing up to the party and saying we will now be in the center of payments. that has caused a collective heart attack. there are payment companies that are aligned with apple. there are payment penalties that are not. they are having a stroke in real time. they're trying to figure out the implications of apple pay. they figure google will respond to apple pay. >> google wallet has not worked out. why didn't it?

>> this is what is interesting about apple pay. it is revolutionary, but it is the most consistent of the existing payment systems. what is surprising is that some things don't change with apple pay. you put in your credit card. >> are you saying it's not innovative? >> it is innovative but it is consistent with the status quo. it is very clever. i acknowledged what i just said. it is cleverly done. if everyone has a way to pay and all the merchants take it, then it is all great. until you have universal acceptance, nobody uses it. is it a networks affect problem? it is calibrated to skip through that to be in line with the status quo of payments. it plugs into the existing system. it inserts apple in the middle

of the existing system. bitcoin is the inverse of that. it is radical. crypto currency is truly revolutionary. a different way to do transaction processing. a potential way to replace the status quo. it is far and away the most innovative. apple pay is the thing that will have the impact in the next three years. the combination of those two will cause enormous change. >> you have been a huge supporter of bitcoin. the price has plummeted. do you allow for the fact that you could be wrong? >> sure. the saving graces -- we are venture capitalists. i think like a venture capitalist. we make 10 bets. we assume that five will go straight to zero. no one knows one way or the other. if it does work, it could be profound and revolutionary and gigantic.

that said, underneath that is that the crypto currency concept will become vitally important. i think it will be in the form of bitcoin. even if it is not, it will be something else. >> netflix could have a billion subscribers in the early 2020's. there is no reason why it cannot be gigantic. ♪

>> a lot has been made of the power of the sharing economy. you recently tweeted, perhaps the single biggest enabler is the affordable care act, a.k.a. obamacare. i know you have been a republican donor, and some republicans want obama to repeal. what would you say to that? >> if you hate obama care as a government takeover, you should still love it because it makes possible for people to pursue their own dreams. >> there has been a conversation

going on about inequality and responsibility and companies that are part of the stanford hospital project. mark benioff has been adamant that companies need to do more. what do you think? >> that is basically true. a lot of the new startups are brand-new. a good part of this is what the big companies do. i think that is a big deal. >> what about inclusion and diversity, something else that -- why is inclusion important? >> i believe tech is inherently inclusionary. the reason i am so confident is because of the incredible coverage -- people in silicon valley -- the challenge is we are still underrepresented when

it comes to women. in the u.s., african-americans and latinos. >> do women ask for raises of they deserve one? [laughter] >> yes. [applause] i don't care what anybody says. i think women should ask for raises. i'm a fan. i think these are solvable problems. two different ways. one is pipeline. there are not -- women are only 15% of computer science graduates. that is too low. we have to get more women into computer science. the other is access, networks. the three organizations that we are funding are working on both sides of that. i think if we really bear down on both sides of that, we can move the needle pretty fast. >> i want to talk about the next five years to 10 years in silicon valley. i want to start with television, because i know you love watching television.

i work in television. i'm selfishly interested. what is the future of television? >> you will be able to subscribe to hbo without being a cable customer. [applause] i always maintained that people want that. everybody in hollywood told me it would never happen. i think television in the form of everything from live television all the way through to nonfiction content, news, so forth, documentaries, fiction, drama, comedy, it will grow a lot. the reason i am so confident is that the reason people can receive streaming video, two billion people, on its way to 5 billion people by the end of the decade. in the future, if you want to watch something, you go straight to it. or, new bundles.

i think netflix could have a billion subscribers by sometime in the early 2020's. amazon will be very big. the new aggregators will be large. >> what is the future of apple under tim cook? will apple be a big player in television? >> it looks promising. it looks extremely promising. the iphone 6 is a huge hit. apple is gaining strength. you can just feel that apple is gaining strength. i think they would do extraordinarily well. the interesting thing about apple tv is that apple keeps refusing to build the tv. everybody keeps predicting there will be an apple tv you put on your wall. they don't build it. i believe that they don't build the tv goes back to the

smartphone, which is a smart fun upgrade cycle is two years. the upgrade cycle for tvs is five years or 10 years. the tv will become a jumper for peripheral to the smartphone. i think that is a low margin business. >> what is the future of elon musk? >> obviously he will build the iron man suit. [applause] [laughter] i think it is obvious. he obviously, in the suit, is going to fly to mars. he has some work to do between here and there. there are three guys, three founders who are really revolutionizing. we are a lucky industry through we have all these people who are incredibly well-known known and

built these amazing companies. he is one of those. we have the three people, peter teel, elon and larry page. you talk to them and their ambitions and aspirations are another step up from the rest of us. the audacity -- look at anyone's areer, the audacity of starting an electric car company. the one company you know you should never start in the united states is a car company. the other company you should never start is a rocket ship company. he is just getting started. he is in his mid-40's. he has another 30 years here on earth. [laughter] >> if peter teel and discover the cure for immortality. you said on twitter, your startup is not the next whatsapp.

you write back to people. someone said, what is the next big thing? you said, something new. what is something new? >> we are trying our best to find it. there is -- peter teel talks about this. there never is one. there will never be another microsoft. there will never be another google. there is just the one. we have founders come in all the time -- there were another -- there will not be another whatsapp. the one thing we do know -- it will be out on the fringe. it will be bizarre. it will be software and service in 1999. people will not think it will work. 10 years later, it will be the next big thing. >> the marc andreessen, everybody. ♪

>> no one through a better