>> live from pier three in san francisco, welcome to "bloomberg west." we focus on innovation, technology, and a future of business. i'm cory johnson. oil prices fell to new 5.5 year lows. digg this w t i trading right now at 4630 at $100 last summer. >> i believe oil prices on the way down.

the contract, that means somebody is getting their hard-earned dollar and their clients money, and i believe oil prices will go lower than rebound. classes goldman sachs/oil forecasts. france, 50,000 security forces including transit hubs anti-jewish schools are this, as the manhunt grows for possible accomplices involved in the charlie hebdo shooting. people shows solidarity after the attack. angela merkel and david cameron dissipated in the market, noting secretary of state john perry absence. there is a flight that crashed into the sea, they have located

the cockpit voice recorder, though that remains on the seabed. crucial as indonesian investigators try to figure out what caused the crash. ibm may have its troubles, but it has topped the u.s. patent list for the 22nd year in a row. 2500 patents last year, a new record for big blue. samsung came in second. for ibm come the question is whether any of those patents declined for 10 straight quarters. now to the lead. after a string of data breaches companies such as sony, hold do bow, and target. speaking at the federal trade commission today, the president unveiled a string of proposals to improve online property and protect against identity theft. >> under the new standard we are proposing, companies would have

to notify consumers of a breach within 30 days. in addition, we are proposing to close loopholes in the loss of we can go after criminals. >> the president says he will introduce a consumer privacy rights bill, as well as legislation that will protect students from the wrongful selling of their data. will these proposals have any impact on their business? joining me now joe the ceo cyber response. what did you make of what the president had to say about an hour ago? is it made sense. the government has needed to step up their game in regards to the repercussions required for these kinds of criminals. secondly, believe it or not, there are only 13 states that require the reporting of a breach. if the organization compromise might be in idaho or montana or chicago, they are not necessarily state laws that require them to report the breach to the actual end-user.

i think the standard innovation as a sailor -- federal regulation might help heighten awareness. >> what types of things will make a difference in terms of a general reporting of these issues, just the fact it will make them take even more seriously the hacks that seemed to happen every so they. >> absolutely. as soon as there is a compromise, we know there is a lawsuit to follow. not necessarily coming from the government, there might be some fines when it comes to determining negligence or not. the fact that the tumors are ready to end up for their own privacy right dictated last week, that will be volumes of how these organizations respond and how they think about how important security is. board members in these organizations will have to spend

money. it is now about protecting the money and protecting your customer base. >> the hits that keep on coming so do the hacks. a hacker hit the twitter account of the u.s. central command they're posting items about north korea, china, and i is on a twitter account. white house correspondent right now phil mattingly has and taking a look at this as the headlines have been crossing. on the very day talking about cyber security, this happens? x minutes after he's -- >> minutes after he finished speaking with first time noticing central command's twitter account had been hacking by a group of individuals who say they are sympathizers with the islamic state, a lot of postings right now. no confirmation yet on what is going on but clear the account has been hacked.

it looks like the youtube account has also been hacked. poor timing anything about the president's remarks, what the week is all about for the white house am all about cyber security. also, it is a broader question about what images -- it looks like they were intending to post addresses of military officers. they are saying they're posting military plans for specific come trees -- countries. really poor timing and something military officials would be concerned about going forward. the headquarters for all of the u.s. activity against iraq and syria right now here that is the base in canada, florida, where that is coming out right now. as you said, sympathizers with islamic state are reportedly behind the attack. that is the initial word. >> stay with us for a minute.

maybe i am a conspiracy theory oriented, but i tend to believe this thing is not just poor timing. when you look at this knowing what you do about cyber crime chemicals like it is tied into the timing? >> it is a calculated approach. if you're going to compromise you think about what is the most ideal time to let the victim know about it and what will be the date statement fees. the campaign loses its luster shortly thereafter. these things are extremely calculated and also just because they get into an account, it is not because of password strength as well. people need to understand browsing the internet alone can infect your computer with malware that logs all of your password so it does not matter if you have a 50 character pass word with random numbers and

symbols. on the endpoint, your laptop desk top, they will get all of those types of credentials. this is a demonstration of that. >> their cyber capabilities i do not think have been as before. >> interesting, i have been speaking with officials last month and their ability to engage in cyber warfare and cyber back on the united face and senior justice department official prosecutor fbi folks have looked into this and said it no uncertain terms that they do not have the capability yet. the biggest question in the biggest concern for federal authorities up to this point with the islamic state topped. they have shown extraordinary talent and extort variability to get those individuals over to

syria or to spur alone worth -- lone wolf types of attacks. the idea of the ability to conduct is really the worst fear for a lot of at least u.s. cyber command for that nature. if this in any way shows they are one step closer to that or hint of that that would be a major problem for u.s. officials and would take them a step further. >> could miss just the hackers trying to show off and not i is in any way just using the threat of the day? >> it is absolutely possible. if a 15-year-old in his underwear in the basement of his mom's house could be a black cat , it is a pretty fair statement to say it does not take a super

rocket scientist. you can redeploy. we've seen it before with the sony attack and malware. i never underestimate the enemy. the whole advantage of surprise is the fact that they wanted to be underestimated. >> here is something that is not a surprise. >> up next, pfizer is in a deal. we will tell you why they're partnering is backed by google. you can watch it streaming on your tablet, your phone. bloomberg.com and apple tv amazon fire tv. we are pretty much everywhere. ♪

clijsters is "bloomberg west." i am cory johnson. unprecedented access to dna data. 650,000 people largest u.s. drug and -- announcing a deal by google. access to the largest anonymous dna base of the time -- of its kind. it raises interesting questions about how dated will be used and how it is gathered. generally right now congratulations for getting the deal out. this is exactly the kind of thing it seems like 23 and me can sort of lead two. crescent is true. this has been a division from the beginning. we would empower people by giving them direct access to genetic information and the toast to understand it. we would invite these people for researchers.

>> using simple dna testing or identifying technology, what is the elevator description of it? >> people can order from 23 me.com, they spit into a tube and we look at hundreds of thousands of points in the dna and give them an interpretation of what it means about their ancestry and they can access that information over time as we learn more. >> there is also a suggestion of disease prevention for the individual, but also the gathering of data that can be used anonymously, you guys say. question is anonymous in that people their genetic information and health information they provide about themselves is kept separately, from their name, address, or anything personally identified. that information is aggregated together across many people. >> the notion that there are certain genetic tests that are precursors to different types of

disease, and yet, issues with the fda about sharing with people suggesting it is just that. >> one of the founding principles of the country is you want to move to a system that is, rather than being reactive actually prevent it. people are going to be empowered with information about their health and one important use of information is through your genetics. that is something the company is really striving to move forward. >> you guys have made the information available to researchers in the past academically. how is what you are doing with pfizer different? then what you have done with researchers in an academic environment? >> for patients who have a particular illness, the onus is will be treated by the companies that make medicine. pfizer is a tremendous company. they make drugs to treat many conditions. it is unprecedented the way they will be able to access information from people who have

consented for that. and across a lot of different areas. studying everything from obesity, to chronic pain, to lucas in their development. >> it is nice of you to do this. what you get business out of? >> this is important to us in order to get a sustainable business. we need partners like this. crassly you get into the pieces of drugs developed? osi not able to disclose the financial details of the collaboration. >> wouldn't that be the kind of thing you would want to have as an option on the success and therefore, is this the kind of thing you would only want to do a few deals? >> i think it is important to have a lot of people accessing this data. 20 three me signed 14 partnerships in 2014. we have only announced a couple of those so far. the database is massive there it we are sitting on a tremendous

amount of information and we want as many smart people as possible mining that data area pfizer makes a lot of drugs for a lot of things but not everything. >> are there certain condition is -- conditions you are targeting because they might not be pursuing something like lupus, because there are only so many patients but there are more, to develop a straw because they have got a data now? >> the goal for us is to make the overall process cheaper. nine out of 10 drugs fail in clinical trials. it is likely because not a lot of fumigated goes into the development process. >> make it in a violent finish in a vile. last question. how long will it take before we start to see some drugs come out of it? >> i hope we will start to see things soon, in years rather than decades. >> five or 10? >> i would like to see it earlier, on the five side.

>> thank you very much. we will see you right back here. ♪

>> i am with and on the markets update. credits are standing the rally whether we talk about the five-year, 10 year, or 30 year low -- 30 year. it reached 1.8 point 622%. we are not near those levels yet, but on a closing basis, we are certainly headed for multiyear lows are oil has settled down. just settling under 4650 per barrel. stocks pretty much down sing-along in a tight range. they than forecast yield as investors seek safety events like gold and the japanese yen. we continue to monitor all these

moves with treasuries extending their rallies in the meantime. more "bloomberg west" with cory johnson is up and request the motor city is abuzz with the north american international auto show again this year. stealing the spotlight, the. engulfed. the north american car of the year. believe that. matt miller now with us from detroit, and he has got a special guest, michael moran. matt? >> yes. i'm joined here by michael horn. it has been a surprising year for the volts lagan. i think of this as a car from my youth, but it is a new generation and it is winning all of these awards. what is going on? >> you did your homework. we love 110 words this morning, we also the north american. we are really exhilarated --

exhilarated and excited. it is great from the american markets, consumers as well as the media, the press, the journalist, that we are right on with this car and turns -- in terms of its design. it is fun to drive, as well as value. >> it comes at a time when full slag and brand sales have fallen. the larger group achieved a record this year worldwide with more than 10 million cars. the band itself has had weakness here in the u.s. do you think this is the kind of kick in the but you need to turn it around? >> i think we kicked ourselves in the but last year because in the total of the year, we were down 10%. in the first nine months, 50% down. in the fourth quarter, we were up like 4%. this is due to the success of the jeddah, very well received and which carries the same deanie at -- dna. >> you have also behind us a new

concept for a crossover suv here. tell us about it and do you need to add more of these to your lineup? fax as announced the middle of the last year in july, we build the midsize suv and as of the end of 2016, this will be our platform, and the spec here is on the same platform, but it is a coupe, a two row, lower roof less exterior size, but in this context, we have two objectives to show you a future perspective of how this will look like, and we will test your reactions here because we think about building this one as well. >> so it is a separate project from what you will definitely build. this is possible on how we will receive it. 10 rewards on this, we will

build it as well. >> it is a strategy. regardless of dna, we want to carry it out, not only the midsize suv, but also i contact suv and also american markets. then we have to make your evidence of those here. this is a good example. >> let me ask you one final example. we focus on technology and you're one of the only carmakers that has taken apples technology as well as google technologies and put them on the infotainment system. >> yes. we are very happy. we have seen the best of the best. this is not future and long-term but we bring a totally new generation of infotainment features, much faster, bigger screens.

you compare all of your major smartphones directly with the system. it will be great. >> michael horn, thank you very much. back to you. >> matt miller, thank you very much. more after this. ♪

>> you watching "bloomberg west." i am cory johnson. president obama wants to send qualified american students to community colleges for free. the plan would cost $60 billion over the next decade. the fed will pick up three quarters of the data mistake the rest. plan is subject to approval by congress, which plans not to approve a lot of things. joining us from new york, cheg ceo. it is a broad and big idea.

classes is very ambitious and i appreciate the objective to lower the cost of education, rising 6-7% every year for the last years, and not for any good reason because the results are terrible. the challenges is that congress is likely to pass it. >> talking about dropout rates of community colleges? >> all of it. $1.3 billion of student loan debt. we have less than 40% graduation rates, the average time graduate a four-year school seems to be six years. over 40 for death over 40% of people do not graduate at all. everything we keep raising the prices on an investigating have

not resulted in a better outcome for the economy and particularly for students. for me, the more people who get involved in education, the better. if 50% of them will not graduate, what will we do with the 50% who are saddled with those loans, do not have a degree, and then we'll go out and try to get a job much mark a do not think this answers the bigger problem, but i think it is the right kind of discussion to be having at this point which is how we get education to work with american families. >> if paying for those four federal grants and so on does not do it, what does improve those results? >> in business, you tend to rationalize competitive. there has not been a lot of pressure on the school to change the way they do business. as college loans have increased, the tuition can increase. we need to find a way to cap what we give, not because we

want fewer to go to school, but because we want the school to go on the right side. they're doing phenomenally well they will graduate with critical thinking and we also need to be thinking of practical learning skills. he cannot use mics off excel you cannot get aged -- a good job in a company and your career. we need to look to expand the curriculum. it is still shocking to me we have not really pushed. i'm surprised the president did not push for more online learning. we can use fewer institutions and fewer professors to teach online than ever before. there are a number of things we can do and should do. classless take the online learning. maybe because the preponderance of online education, has been

the for-profit schools that offered really crummy results at a high price and left a lot of unpayable student loan debt behind so online education has not shown the great tested when otherwise get. >> you're absolutely right, those have been very difficult for students, families, the economy. very low graduation rates when they the graduate, low employment rates. they have the lowest tuition on paper but the highest that per student. clearly, for-profit institutions leveraging low-cost college loans to make money are not the right answer either. the kid ability online for the institutions we are talking about, there are 4000 colleges over 1000 online degree programs people to take already. if you take just community colleges, where millions of students is him -- students, day

and night, anytime, so they do not have quit their jobs professors have been trained with the right information, the right way. we can combine the online effort with community colleges effort and lower the cost increase access, and improve results, which is at the end of the day what we all care about. >> what is the percentage of digital business compared to the textbook business? >> it has grown astronomically. it is now over 30%. we are expected to be over 40% next year. online textbooks, our tutoring business we required. all of those are growing extraordinarily fast with high gross margins. the transformation we talked about a year ago is not underway. we have estimated three years

ago, growing at a huge rate. the business has started. the students really embrace it. today's generation, my two daughters they are dean's list doing a great job in school, but they have never known a day without the internet, broadband, iphone, not ask. they expect to be able to learn online and do their homework online and get tutoring online. companies like this chegg are giving it to them. learning to more communities and more people, online ought to be the area of focus, not just three more people in where they have to leave their jobs and take time out of their work they. >> online, surrounded by the freezing cold for a change. thank you very much. five years after a massive

earthquake, one million five people out of their home opened for business yet? we will talk with a telecom mogul next. ♪

>> today is the five-year anniversary of the earthquake that devastated haiti. the government says the company is open for business. stephanie ruhle traveled to haiti to see for herself. i am so anxious to see this. it is a place of business and a place that has seen unbelievable suffering in the past century. >> indeed, it has. it has had a far road to go. 80's government has been saying it is open for business.

i went to see the largest cell phone carrier in haiti, and meet with their founder an irish billionaire who basically shut her that haiti, drove around and said nobody has got a cell phone here. there is an opportunity and approved to be a huge one for him. take a look. >> we just drove around in a taxi. we are looking at people buying on the street tonight, -- >> it is amazing. throughout the developing world, haiti has been one third of 12.8 million users. aside from the fact there are two gisele signs everywhere, it is so people -- are member people are living on $2.5 a day. i went out to a guy with nine kids who lives in a cinderblock home with no running water or

electricity walking through the farmland there a machete in one land. his cell phone rang. he said to me his most important position is his phone. for dennis o'brien come it has been a big success story. classes that a one off -- >> is that a one off, there is no room for anything else, or other kinds of technology companies that could succeed in haiti? >> in terms of technology, digit cell invested in a tablet maker deploying a number of haitians but you're right, can haiti actually succeed in other industries? the infrastructure is a disaster. there is a horrible power grid and very little running water. even people who want jobs have to walk two hours to get to the job because there is no public transportation. no board of education, no hospitals. dennis o'brien claims there are opportunities and you just need

to look for them. listen. >> there is this kind of you that caribbean companies are corrupt and difficult. if i talk to an asian investor ok, they will not be looking at the problems. they want to know the opportunities. whereas americans and europeans would say, look at all the problems, how do we get over the problems? to be honest, they will miss out on the opportunity. >> i mean, cory, you cannot necessarily argue with the guy. he also gives a lot back to the country. it is clear there are huge problems. is there corruption? no doubt. a workforce that is highly motivated, clearly inexpensive, they have got a five dollar a day minimum wage two thirds of the country are unemployed or underemployed. it is a boat ride from miami. if you look at it that way, it is a great opportunity. are people going to lean in and really invest?

>> eire i was there a long time ago, one of the biggest is this is around, fishing baseballs by hand. that is what they wanted to show off as opportunities for rural business. they lost the baseball business. what do people of haiti get out of investments. >> right now, responsible for nine family members. they do not have education or health care options. the answer is, let's try to get them jobs. the guys are not paying minimum wage. they are paying above minimum wage. >> i cannot wait to see. >> you are not watching football tonight, cory. >> there is a football game tonight? i am unaware of this. the thing to watch tonight is haiti, open for business 9:00 on the east coast and on the west coast. open for business a fascinating

country and a fascinating culture. great language. "bottom line" with mark crumpton is coming up at the top of the hour. what have you got? >> we will continue to follow a developing story bloomberg's white house correspondent phil mattingly will have the latest details. we will go back to detroit with the north american national auto show. the executive vice president -- i will see you in a few minutes. >> thank you very much. spacex. the mission did not go according to plan. the plan was to land a reusable rocket on a floating are that they're calling a drone. how big of a blow was the failure? we will talk about that all next. ♪

>> i am cory johnson. the stakes x -- spacex capsule arrived carrying groceries. supplies. perhaps the big news is the attempt to land the reusable rocket was not successful. you on muska tweeted -- close but no cigar this time. it bodes well for the future. first, chris, explain a little bit. the first section of the rocket, which fell off as the rocket started to reach orbit, was the part they started to land on the autonomous spaceport drone ship

which i would call a big barge but the castle made it to the space station. let's talk about the autonomous drone ship first. question it can hold position using a bunch of different propellers underwater. using a gps come it can stay in one place very precisely, which is what you need when that piece of the rocket ship is coming back and trying to land on it like a big broomstick landing, imagine if you could bounce a broomstick while out at sea. the barge just came back into court yesterday. >> describe the process to me and what you see? >> we did it exactly the same

thing when i was on the space station. it is really precise. the unmanned space ship launched a few days ago gets close to the space station and then shuts everything off their once it is perfectly there, the two of us orbiting the world together, you reach up quickly with a great big robot arm, and in this case it was a guy on board named which will more. he reached out, helps -- helped and grabs onto the spaceship, plucking a dragon out of the air , and then pulling it down. right now up on the space station there opening the hatches, and getting us all the christmas presents and everything else. two tons of stuff was inside. >> there are always mystery experiments. what do we know about these premise they're doing and how does it work on there are scientific permits that are part of the cargoes? >> this particular dragon

spaceship is carrying here is that support about 250 different experiments. some of them being how the gases and liquids are transported in the atmosphere to try to understand atmospheric physics better, experiments studying radiation, studying crew health, months and months worth of experiments on board, as well as food, clothes, all the things you need to live out in space. it is an amazing little ship, especially in the fall with the competing ship with orbital sciences. everyone was really counting on this one, really nice this morning for which to reach out and grab it and get the hatch open. >> indeed your let's talk about why the landing of the first stage of the rocket is so important to this space industry? what is it to him that is so

groundbreaking? >> match and every time you got an airliner, when he landed, it had to throw a three quarters of the airliner and build it over again. the cost of each flight would be huge. but if you could reuse that every single time if you could like an airliner does, landed and all he has to do is refuel it and make sure it is service -- serviceable it decreases the cost significantly. up until now, the first stage, a part of the rocket that gets you above the air and gets you going fast, that first stage has always been thrown away because it is simpler. but now, maybe our ability technology computers, are far enough along to land it. we would like to landed on land. you do not want your first test where it will probably not work right, you do not want your first test where it crashed on

the ground so spacex put it safely out at sea, they're trying to land that first rocket, sort of like a big telephone pole to come back. once they do that, we will give it a try on land. once that gets proven, it will decrease the cost of going to space significantly, and also open things up. it is an important bit of technology to make spacex more affordable and therefore more capable. >> the cynic in me says if it is proven. thank you for joining us. we appreciate that. the bwest byte was the focus on one number that tells us a whole lot. telling us a whole lot is shelby holliday from new york. what have you got? >> the bwest byte today is 20 the number cents the price of the app is increasing in canada at the app store.

you will be paying 119 instead of $.99. the move comes at an interesting time, after apple had a tremendous year with its app store. marks one of apple's biggest global reactions to currency fluctuations in recent years. though the company tweet prices a couple of years ago for some countries, this is the first time they ever touched prices in canada. obviously, the u.s. dollar has remained strong. u.s. currency has declined against the u.s. dollar. for now, apps in the u.s. are saying and 99 and. that is pretty amazing. what else can you buy for $.99 these days? i do not even think the dollar menu in new york is $.99. >> $.99, the greatest advertising gimmick ever created. the strengthening of the u.s. dollar, you do not think about how much it means for technology. so many technology companies like hewlett-packard, mike ibm, like oracle themselves but for

apple, particularly focused on retailer, as good as the idea of nine nine cents is, maybe their damaged by the strong knowledge. on some level, the marketing value was lost very cleft that is exactly right. apple says 60% of the revenue comes from overseas. they're selling more apps overseas and more hardware overseas. we saw them release the price of the iphone in russia. this move is raising speculation that maybe they will change iphone prices around the world. you never know. >> they will probably have to with the rising dollar. all kinds of weird effects when we see the currency trading. it will be hard to see overseas. thank you. you can always get the latest headlines on your phone, your tablet, on bloomberg radio. more "bloomberg west" tomorrow. ♪

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>> from bloomberg world headquarters in new york, i am mark crumpton. this is "bottom line." to our viewers in the united states and those u.v. joining us from around the world, welcome. we have full coverage of the stocks and stories making headlines. matt miller is live at the detroit auto show to talk with a top executive from general motors. we have a roundtable on the keystone pipeline. joining us, rob b