>> live from pier three in san francisco, welcome to bloomberg west. i am emily chang. your check of bloomberg top headlines. while day for apple shares as they plunged 5% in just one , however, the stock quickly recovered some of those losses with no apparent reason for the price swing. facebook, names like triple adviser, and yelp, all getting it.

the latest target of hackers. a group of hackers have been checking wall street insiders providing them with data. be usingre believed to the information for insider trading. health the cases involve care or pharmaceutical companies. intel is buying a canadian startup to bolster its security offering. financial terms were not disclosed. without having to mount -- remember him manually type in the password. they also own an antivirus software owner, mcafee. an owner is playing aintel is bn startup to bolster its security offering. financial much bigger role in holiday shopping. here is paypal's head of global consumer initiative. >> we crunched some of the numbers and in terms of mobile shopping, mobile shopping is on the rise. your of your paypal, a 62%

increase in mobile shopping volume. as compared to last year on black friday. on thanksgiving, it is 47 percent. >> sales at paypal's current company ebay. ebay is spinning off paypal in the new year. two hourly. monday, starting to lose some of its importance. people are expected to shop online today. that is down about 3% from last year. that follows a pattern from black friday which saw over all sales down 11%. will cyber monday follow the trend? amazon is certainly prepared for the company for using 15,000 robots at 10 of its u.s. film it centers. cory johnson is live at one of those fulfillment centers.

in tracy, california, 50 miles east of where i am here in san francisco. the story is a little bit different for amazon. >> yes. a lot of important things are going on here at this fulfillment center. it is cyber monday, the biggest day of the year for amazon. facility is really important first of all because of its location, and there was a time when amazon did not want to have facilities in states like california and they did not want to pay sales tax. that allowed them to change their business model. this is in california, equidistant, about an hour and an hour and a half depending on traffic. they are all reachable from this facility here. roadstable this is, the they are using. the acquisition two years ago, they deploy these robots in this facility to really change the operation in terms of how the workers work here, how they have

certain goods when they come off the truck, how they pick them when they go back through customer, and also how much they can manage it. executives sayn they can hold 70% more goods on the facility because the robots can cram the stuff together and squeeze them between the rows and find these things. a much bigger return and trip a lot more goods a lot more quickly than ever before. >> all right. our bloomberg editor at large. we will see you later in the show. thank you. as amazon and other retailers rush to ship orders, they worked to promote special deals and discounts to shoppers. many other companies are trading to twitter, which allows users to buy directly from the newsfeed. so how much can this e-commerce push business? the twitter director joins me now here in the studio.

a busy day for you guys. how busy? >> we have a lot of really great things happening in the last couple of days and we are really excited to see brands engage with consumers, not only pushing offers, which is important, but also thinking about how they can add value to shoppers, so they can provide behind-the-scenes tips and tricks, to all generate interest and stay relevant. kuester is obviously not the first thing you think of when you think, i want to get a deal on back -- black friday. how do you change consumer habits? i spent a lot of time on twitter during the week and i spent very little time on twitter this past week and a lot of time on amazon. it isthink about twitter, about discovery. that is what we are enabling for you. we are helping you find what is good for you in a moment. interest today, but also shopping. we think about holiday seasons, shopping is really important.

drive really looking to the discovery for consumers. >> your testing out a buy button. how are consumers behaving? >> it is really exciting, but it is also the early days for us. we want to think about shortening the distance from the customer talking about a product to being able to purchase it. this is something we are testing today, but we want to take the time to get it right. we do not want to rush to get it out to market. >> anything you have learned about how they are being used question mark x we have great data. a great campaign is running today. amc theaters is emoting the ability to purchase a gift card through twitter and upon the purchase, they provide a voucher for a free popcorn at the inner. you might want to get away to see a film, this is a great opportunity. is the idea to get merchants and retailers to offer retailers

on twitter? >> exclusives are great. it is about finding the right opportunity to tap -- to capitalize. you have people asking for products and advice on what to buy. distanceo shorten the from that to the actual purchase. >> what about the product with amazon? >> we cannot comment specifically on that, but really how consumerssee are thinking about a platform from a commerce standpoint. we are seeing all great learnings. >> what can twitter offer that other companies cannot? other platforms cannot? discovery andthat we have a live conversational platform and we are heavily accessed globally. when you put that together, he lends itself well to discovery. that provides an opportunity for a brand to interact with the consumer throughout the past purchase. that is important. >> facebook is testing a buy button as well. a buy button when

you have the biggest retail day of the year over thanksgiving weekend? >> good question. twitter is focusing on getting it right for consumers. there are opportunities to push products in a market, but we want to make sure it is right and it works well first. i think we will just air on the side of getting it right versus getting something out. >> in terms of the business, what is twitter's cut? if i buy something based on what i have seen on twitter, what does twitter get out of it? if wet i can say is develop the product effectively and we shorten the gap, it will work really well for brands and we believe that will work really well for twitter as a business. >> all right. thank you so much for joining us. great to have you. we hope it comes down for you, or maybe not. is twitter looking to buy shots? the selfie f geithner justin bieber.

you can watch it streaming on your phone and your tablet at bloomberg.com, and amazon fire tv. ♪

>> many in the tech community wonder who twitter is targeting. all the tweets that was, footer has told us, i still think we should by then and he is on the schedule december 16 and we will need to sell him. reports say the target was shot, a selfie at back by

singer justin bieber. neither company confirmed those reports and it is still unclear if any talks have taken place, but what value would twitter again if they did not buy them? joining us now, and advisor who .uns a firm and great to have you on the show. my first experience, because of with theook it producer and it has been retweeted more than 2000 times. >> it is a powerful product. >> who are these people? community of young adults, teens and queens, primarily aged 13-19. the average age is 16. we have over 3 million on the product now, growing very quickly. it is all word-of-mouth and it started out with justin bieber and celebrity fans but has grown much further beyond that. they are spending over -- most

of them are spanning over 50% every day, coming back 20 minutes. app becoming part of their daily life. >> are all these people real because when it comes to beaver, there are talks of beaver bots and in general on twitter, there were awfully a lot of people writing back to me. >> these are all real people. explain whyk up and we're excited about investing in the company. i think it will help explain what is going on. the vision of the founders, two ,or others, -- two brothers they have been building these mobile games primarily for many years before shots. they understand the demographic very well. what they want to do is bring to that isd a platform

safe for the young demographic. no bullying, but so fun and cool and a way to express themselves. people like celebrities who invest in it share the same vision. that is why we got involved. needsly believe the world a place where young adults can express themselves in a place where there -- where they will not be bullied. i have a 13-year-old daughter and a 16-year-old son spending all their time on these platforms. even places like instagram where they are safe to 40% of young adults today are being bullied daily and we think it is time for young results -- young adults of a place to exist without bullying. i do not have any more information than you were other folks. advisor. investor the reality is what i would tell the shots founders is regardless of whatever truth there is, this

is not the time to sell. the company's doing great right now. million shot3 ease, which is what they call themselves. it is growing quickly. 50% of them are spending 20 minutes every day on the product. it is growing like crazy. there is no reason to sell. if the founders decided, whenever they want to sell, we back them, but i think they have been wanting to build the company for many years to come. >> doesn't have a meeting on twitter? >> i cannot if -- confirm or deny that. i would like to point out there has been speculation of other companies that twitter has potentially been looking at in other media. i am proud to say two of the top three companies are major venture investments. >> tell me a little bit about how justin bieber got involved. >> sure. the founder of the app is very well network and he understands the young demographic. so he met justin, and they share , and justin

immediately got this. figures like justin bieber and others are putting themselves out there. for better or worse, part of the job they will get in the media, some will not be nice and they will get bullied themselves. they wanted to create a place where the 15 million teen fans can express himself in a safeway without being bullied. justin became a cash investor. >> how involved is he today question mark >> very involved. he is posting his photos. he just recently, he posted shots with his mom, and she did a shot back to him, which was really great. he is using it as part of his daily life. you would saying if give advice to your founders, you say do not sell now. but this looks at another photo sharing app. what makes shots stand out over

time from all the other options out there? >> a great question. when we look at investing early on, the first thing we ask our consumer startups is, are you passionate about building a vision worth fighting for? every one of our companies has a vision worth fighting for, the solving of big problems for consumer marketplaces. it is a problem that cannot be solved elsewhere. we look at this and said, there needs to be a large marketplace community for hundreds of millions of young adults and teens -- of teens and queens to express themselves in a safe place. they cannot do that anywhere else. that is why we need to exist. it is not just another selfie photo sharing app. a product of else is unique and is told in its own way. some of the features we are having launching in this quarter in the next quarter will continue to be further unique. instagram is safe for a lot of kids. you can comment, for example.

when you comment on them as -- on instagram, a lot of the comments are, that sure looks stupid on you and you -- you're looking ugly today. the way shots is built, everything you do is positive. there is an only positive feeling in the community. the young adults using it, they do not even know, they love the product because it is positive. it is still a fun and cool place to be, but they get the emotional connection because only great stuff happens and there are only positive comments going on. >> there is something to be said that the twitter can be used to make a better experience. >> yes. clearly, there is reason why there is regulation. you can see a fast-growing and younger demographic would be a great fit for twitter. , i think this is not necessarily the right time. the company's growing like crazy. it reached one million shot is faster than facebook reached

their million members and almost asast as am -- as instagram. i think, there will be tens of millions of them. >> how do you know this is not a trend and not a fad? >> that is part of what i do. a see about 2000 companies quarter when we look at investing. we see a lot of trends and we understand when there is a vision worth fighting for in a great team that can execute, that is when we make our big bets. this fit all of our filters and we thought, this is one that can be a billion-dollar business. we have been very lucky and fortunate in my career. i've been able to work with three unicorns. your listeners probably know. a billion-dollar exit company. .y first was nbc internet it was a 6 billion-dollar public company. i was one of the first employees at the first social network. we started a company with

michael, and that became the third largest social network and we sold that in 2008 for almost $1 billion. >> 800 million, but not quite a billion. >> and the third one was a company called tango, one of the largest communication networks and platforms. that was recently valued over 1 billion and a half dollars. alibaba put some money in it. the uniformu spot -- the unicorn for anyone else? everyone is trying to find it. >> yes. it is something, doing this for 25 years, part of it is pattern recognition and part of it is sticking to the filters we have seen, and this is a great team. do they have a vision worth fighting for? we only do consumer investing. we stick to what we know and we help build these kinds of company's and we will continue to do that. >> ok. we will be watching to see if you have indeed had another unicorn. i give her joining us.

shots ifntinue to use i will get 2000 retweets. we will be right back after a quick break. ♪

>> i am emily chang and this is bloombert west. uber says it has disciplined the new york general manager. you may call -- recall he was under fire for tracking a buzzy reporter. bloomberg did not give details on exactly what he did wrong or what his punishment was, but he will keep his job. another executive was in trouble for making comments about targeting journalists. he has not been disciplined, at least not publicly. more than 6 billion people are expected to have smart phones

the year 2001 a. how will silicon valley deal with the massive demand for data? that is next. and you can watch us streaming on your phone and your tablet on bloomberg.com, apple tv, and amazon fire tv. ♪ minutes after the hour. bloomberg television is on the markets. let's take a look at where stocks are trading on the first day of december. declines across the board. down less than 1/10 of 1%. the s&p and nasdaq are still under pressure. one of the reason why retail numbers are coming out after the weekend. jcpenney, one of the examples of the clients we are seeing in read l. shares are falling on cyber monday. a tough day for the retailer sector after weekend sales relevant percent versus the years ago. rise,er's shares on the

nearly 6% in italy last month. shares have rallied more than $.40 cents the ipo last month. we will get u.s. auto sales data tomorrow and bloombert west will be right back. ♪

>> you're watching bloomberg west, where we focus on innovation, technology, and the future of business. i am emily chang. the number of people with smartphone subscriptions is expected to double to more than 6 billion by 2020. 90% of people over the age of six, yes, six years old, will have a mobile phone by then. these are just some of the findings from the report. trends are weile seeing and how is silicon valley preparing for that growth in consumption? i am joined now by the ceo and president, did i just say six

years old? >> you did. .hat is our prediction those above six years old will have a mobile phone by 2020. what we are seeing so for -- so far is a slow development. the next year, the reason is this is now taking place. the prices are coming down, the technology is reaching so much further out. we believe 93% of the earth will have mobile coverage by the year we have inhe scale this industry. amazing numbers, but everything is in front of us right now. >> we have been talking about smartphone saturation and concerns for samsung specifically. it sounds like smart phone makers do not have anything to worry about. that's what we are facing, smartphones are a very natural thing. of the 7 billion mobile subscriptions in the world, 4.5 g featuref them are 2

phones. many countries in many places on earth have that coverage. they're not going into three g or four g coverage. we usually say, for an average $10 smartphone, 110 billion people who acquire it can afford it. but -- >> what kinds of technological challenges does this mean? does meetupply demand? >> a lot of things run on diesel. we have to think about different ways of getting power out there. the other thing is the same technology we deploy in the u.s. and sweden, we deploy in africa and india as well. we use the same technology and then we get scale. scale is the game here. that is where we can have people of about six years old having a mobile phone by 2020.

to bringffort connectivity to more remote parts of the world, how much do you take internet. work will drive the numbers, realistically? ,> the whole scale of operators that carries the majority of mobile traffic, but when you come to the more cumbersome new innovations, and for them, the core istnership like the internet important, we, the technology and they come with innovation apps and companies like samsung think about devices coming down in price. the station will be very important. from a is erickson doing network perspective to make it easier to get this on dumber phones in developing countries? >> one of the things we're doing here, we have a lot of test

heads, because you need to do apps that are working on two g or three g, not only on 4g. that is where apt developers aren't you norm is important. and not only that, we are upgrading all around the world, the networks. that is happening as we speak. that and spending 5 billion u.s. dollars in research and development every year to have the latest technology five g as well, that is what we are doing. >> what are the biggest challenges we have so far with internet. work is a vaguely? >> nothing, we are just coming from different angles. telecoms, thef media industry, and internet industries. we are coming together and basically, all the needs to work together all the deficiencies. >> it mark zuckerberg call you personally? >> we had already established relationships. me to joinberg asked

. he reached out to our organization and asked if we wanted to join. it is a good idea. few other technology companies are in that many countries and we have a role to play in this. a partnership with ibm. what is possible with five g that is not possible with 4g? >> a service aware network. of newnt to be aware types of devices and services in a totally different way. very low power consumption because they cannot change the password for every five years. others can be connected. that means very low maintenance he. the networks need to be much more service aware. g.t went on to develop five our expectation is that five g will be there 2020. partner.en a long-term

we are now looking into new types needed for five g. >> led companies will win as a result of all of these additional people using more data, and what companies will lose? >> two g was 15 vendors in the world that supplied to gdp or on 4g, it is only for five it is a very brutally tough -- but i believe we would be a much nicer team player with five g. i think the whole world would benefit with broadband because the barriers between countries and people is going away. going away in efforts -- in africa and to being deployed in the u.s. and people in sweden can to do business where ever because the infrastructure actually feeds what we have in front of us. >> by 2020, when we have at least another billion people

online? already now, it is probably the next 20 months. 2.9 billion absolutely, 2.9 billion right now. it was 2 billion only a year ago. with our production, it will have almost three times more people having access to the internet in the next five years. it took many years to get to where we are today. that is where we are underestimating the enormous scaler we get from the infrastructure and around the world right now. that, but one on thing we work with, seeing that the new goals all the nations will agree upon from 2015 come it has to include technologies, broadband, mobility, and the cloud. that can transform many of the challenges we have on earth. >> a lot of things to think

about. it is great to have you here on the show. interested to see those numbers. thank you. still ahead, amazon is using thousands of robots to meet demand in online orders. we will show you how it all works coming up. and you can watch us streaming on your tablet and your phone. bloomberg.com, apple tv, and amazon fire tv. ♪

at sign emily chang and this is bloombert west. microsoft with its mobile offerings. dozen staffers are joining microsoft as part of a deal with reports of a price tagged at more than $200 million. turning now to cyber security, sony pictures is under attack. the tv studio was hacked last week by the guardians of peace

hacker group who still finished movies and sensitive information data from the company. nouvelles like fury have already been downloaded 500 times -- five hundred thousand times. sony pictures is investigating whether the government of north korea could be involved in the hack. for the interview, a comedy about kim jong-un. now, ceo and founder joe loomis. a cyber security firm that helps protect fortune 500 countries from cyber attacks. who do you think did it? >> the detail is in the facts. acoincidence that we have got movie production company that is releasing a video, or a movie coming out for and in garrison, politically correct type of message. you are starting to see a new transformation of the new type

of warfare coming along great you have a foreign company whereing a corporation, you have gameplay going on right now that you have never seen before. and the evidence really points to the east on this one. >> you are talking about high profile movies, high profile movies, high-profile actors, including brad pitt. he is in the movie fury. they stole everything from the movies to the actors identification, budget contract figures. what can a hacker group do with that information? >> a lot of dangerous things. he can still your identity, take credit cards out in your name, sell it, leverage it, disclose confidential information that might have legal consequences. they can really make a rough year for any individual where they have that kind of sad for me -- sensitive information. >> this movie fury has been downloaded 500,000 times.

ini have the background piracy control. one of my former companies was in piracy regulation in stopping that guys. one of the only major booming businesses when it comes to hollywood is a major moneymaker for the united states. piracy, the amount of revenue lost in that, think about it. if you are able to get that stuff relatively easy off the internet, are you really going to buy the movie tickets? tens of millions of dollars of revenue losses with the amount of piracy. the nda aa have really stepped up their game on the enforcement of these types of illegal downloads. when you have events like this take place where you have compromises and data taken, you're looking at losses that might not be realized initially, but definitely tens of millions of dollars in loss of revenue. >> took about a week for the company to get back online. so long? >> sophistication of these attacks, you do not know how far

, the hacker group has invented itself in your network third part of that response you have to do is really create the process. remember whenu playstation went down for over a month, part of that process is taking things off-line so that you do not further the damage. if they chose to keep their network up, who knows if they might not have been filtering out and filing out additional movies that is confidential. part of the collateral damage is cutting the cord, then it creates the triage rocks us in the investigation in forensics. i've been told those guys are on the scene and they are first >> operation, they're doing their to really protect the customer but at the same time, helped them not further the damaging more. >> all right. thank you so much for giving us some insight into the attack on sony.

not a good one for sony to be dealing with right now. , with mark crumpton, coming up at the top of the hour. what have you got for us today? is a big rebound in oil on this monday. crude futures advance for the lowest level in more than five years following a failure last week to curb reduction. how will this impact the outlook for oil and what will it mean for consumers? will give us her take and i will see what a few minutes. back to you in san francisco. >> we will see you soon. still ahead, amazon is using thousands of robots to meet demand of online orders in the hot -- in the shopping season. we will show you how it works next. ♪

>> for many online retailers,

cyber monday is likely to be the peak shopping of the year. rolling out a new robot army. cory johnson spoke earlier with one of the amazon executives behind the massive logistics challenge and amazon fulfillment center in tracy, california. for all ofsponsible this stuff, not just in this fulfillment, but all of them. these operations are dramatically changed by the robots. to you, it is amazing to watch when the things disappear there and reappear when they are ready to order. how is this changing operations? >> we have been doing fulfillment for 20 years and improving every year. this is an improvement for our last type of building. the thing about the challenge we face and it is all about this massive selection. ,oday, over 3.5 million units over 21.5 million in the inventory. selection, it is to

take a lot of time. >> there are over 21 million items here? over 21 million types of items. will try to be watch children's toys and power drills and, i don't know, you name it. >> everything from toys to vitamins to toy rockets. probably do 90% of our chopped -- our shopping. >> let me asking this question. does this change the way it works? >> fundamentally. what you see now is everything we're doing is just a value added element to the customer. putting the product in available for sale. this stuff is available right now. order it by noon and get it tonight. it is immediately there. .hey are available

a little under 15 minutes. >> fishermen this amount of learning. that will actually help us with what? what areas are you learning the most of? getting moreabout product and more selection .vailable locally for customers more product per square. system does not need walkways for people and we don't need intermediates at the handling system, you get a lot more authority.

>> you are always welcome. >> talk about the location of that facility. it is interesting to me that it is an hour or two from san francisco, san jose, sacramento. how do you go through the location and how is a change in amazon hacks policy aiding that? >> we're all about getting closer to customers. it is all about getting closer to customers. then it is about the speed of processing you get and the ability to have faster process for the delivery of those customers. as you move from one building to a many building, you are able to get much closer to customers. 5 million back in 1999, you are more of a regional fulfillment player. andhe million in the u.s. 109 globally. now, much closer to the urban location where customers are located. >> the impacts tom i was shocked when i walked out of a church and a mail truck ran by.

it was chock-full of amazon packages. >> it is amazing how fast andomers really adjusted love the sunday delivery they were getting. we have 19 store centers across the united ace supporting sunday delivery to thousands of cities at the tremendous in a fit of being part of our prime program. . worse foretter or them working with the robots? are they working so much harder or is it better because they do not have to walk 10 or 12 miles a day. >> people enjoy really working with the system. what they are getting now is much more directly with the customers appreciate, and as owners of the company, they know what customers value in terms of selection speed and price. they know now that what they are doing is directly what customers want, making the picking order faster, and i think the feedback

has an super positive. they will do with a new level of technology. they will deal with a new system. ad they are giving customers direct benefit from it. >> thank you very much. >> and cory johnson is back with us now from the amazon fulfillment center in tracy, california. time now, cory, for the bwest byte, a number that tells a whole lot. what have you got today special cyber monday. >> believe it or not, it is percent, emily. according to a study done by aol, 78 percent of online u.s. retail shopping in the u.s. last year on cyber monday. 78% was all done in amazon. today, but their frequency -- freakishly large

numbers. this fulfillment center really shows how amazon is gaining a strong advantage over all competitors in the world of online shopping. because of these fulfillment centers all over the place and the robots moving this stuff around in ways their competitors cannot possibly catch up to, because they have hard-working people here, it is really a competitive advantage that is hard for anyone to match. one wonders if that share of the growing market of shopping on cyber monday will continue to grow and share. >> i like to plan ahead, how about you? >> i am picking up new things here. goes and barbie things that are particularly interesting to me. pop tarts, and i am looking at these headphones.

forick something nice out me. i appreciate it so much. thank you for watching, everyone. ♪

♪ >> from bloomberg world headquarters in new york, i am mark crumpton. this is "bottom line," with a main street perspective. to our viewers here in the united states and those joining us from around the world, welcome. he has full coverage of the stocks and stories making headlines, and we have a review of the 2014 box office numbers, and the review is not good. our senior markets correspondent, julie hyman,