>> live from. three in san francisco, welcome to "bloomberg west." -- live from pier three. the european central bank introducing a massive stimulus program. the u.k. chancellor -- >> this is welcome action from the european central bank. but action from the central bank is necessary but not sufficient for european recovery. we want clear plans to make the european continent more

competitive. to create jobs and make sure public finance is in order. we have all of those ingredients in the u.k. and that's why our economic plan is delivering strong economic recovery. we want to see others so that the whole of europe becomes -- recovers. >> 1.1 trillion euros of bond buying. 60 billion euros a month. founders of the chinese company admit there has been fraud. he has four given the more than 4000 workers who committed this corruption -- fourrgiven. the company says it will not happen again. whatsapp is coming to the desktop. it will mirror conversations on the smartphone application.

facebook bought it for -- the underinflated football used by the patriots came as a shock. a shock to coach bill belichick. >> i came in monday morning and was shocked to learn of the news reports about the footballs. i had no knowledge of this situation until monday morning. i have learned a lot more about this process in the last three days than i have in the last four years. >> he will cooperate with the league. they play seattle in the super bowl in 10 days. it's a critical time for ebay.

the company laying off 2400 employees, 7% of its workforce. it's marketplace business at 1% in the fourth quarter. ebay may split into three separate companies. they may sell off their enterprise unit. carl icahn got one of his nominees on the board. a really interesting quarter for ebay. the marketplace business was -- i mentioned the 1% number. >> there was a heck of a lot of noise out of ebay this quarter. the stock was working off corporate catalysts. the fundamentalists are deteriorating.

it's easy to be upfront about it we know the market is focusing on corporate catalysts. there is problem with the marketplace business but we have seen the spike in deflated footballs for sale on ebay. >> i want to separate the investor and the business. investor interest, stock is up today. the paypal spinoff is more certain -- what is going on with the marketplace? >> nobody on the street brought this up but there is clear competitive risk that is exhilarating. amazon and alibaba. they are starting to have a material impact on ebay. this was a turnaround story. john donahoe let a successful consumer pivot as ebay. >> five years ago he saw negative sales growth. >> brought it back up to growing

in line with e-commerce the last two years and this year, they had a wall. there were no more low hanging fruits to pick. amazon and alley bob are having a negative impact. -- ali baba are having a negative impact. >> you mentioned this in your note this morning. what is the relationship between ebay and google? >> ebay generates a lot of people off people going to google looking for particular items. anybody who is dependent on google for a lot of traffic, when google makes those tweaks and views your traffic, your sources as lower quality, you will get less traffic. the google machine out there has

said some of these ebay links were not high-quality and ebay last traffic. >> you search for a certain thing and it does not show up. can they adjust for that? can they change the way things appear? >> this is something they are testing to. they have to spend more on other marketing channels. maybe on facebook or twitter. a lot of things they can do to offset that. >> ebay enterprise -- talk about what this is. >> the one they bought three years ago for couple billion dollars they now say has no real synergies with the rest of the business and they will tell that one. -- sell that one. they say they are willing to be open to strategic options. an outright opl or sell to a better -- ohipo or sell to a

bidder. >> it was a fulfillment center. it seemed like a way to try to match what amazon is doing. >> ebay announced they were coming out of other things. like ebay now. they have done these baby steps into getting into real fulfill that and realized that is not their core competency. >> john donahoe leaves, splitting up the business into three businesses is not the time to be pursuing expensive growth projects. ebay has three businesses with a one-year run. >> they talked about sharpening their focus. they are doing the right thing. they should be focusing more

investments, spending more on marketing paypal and doing whatever they can to turn around the market place business. paypal is a stronger asset. >> other competitors -- i was struck when i was on a setsy. there is a massive marketplace business. are those things starting to threaten ebay? >> you get these many marketplaces. -- mini marketplaces. betsyetsy is a top three marketplace in terms of traffic. there are vertical market places eating away ebay's market share. >> thank you. coming up, for to find a home in silicon valley. teaming up with a technology company to bring the next

generation of cars with cool stuff in them. ♪

>> on cory johnson and this is "bloomberg west." salesforce's ceo says the companies to work harder on cyber security. here is mark benioff stocking to stephanie ruhle -- talking to stephanie ruhle. >> for many executives here they realized cyber security has become an oxymoron. there is no finish line when it comes to cyber security. the internet is inherently unreliable and insecure. that is the way it was designed. we have to work harder to get security to happen. >> a good interview. you can check out the whole thing on bloomberg.com. mark benioff does not see a funding bubble.

he says tech companies should give away more money. they have a history of being cheap. cars are in focus for technology companies. whether self driving cars, greater connectivity or other stuff in the car automakers are paying more attention to technology. ford is opening a new innovation center in silicon valley. making autonomous driving widespread. matt miller spoke to the 40 ceo earlier today. -- the ford ceo earlier today. >> for us, this is right for our business. we really want to be viewed as part of the ecosystem here. we want to be viewed as part of the neighborhood. this is an area where it is a marketplace of ideas. ideas come up and copy shops, meet ups, etc.

it is important for us to drive innovation and drive a lot of progress in our areas that we have laid out that we want to lead in these areas. >> automakers and the media focused on the autonomous car. when i look around here, it's clear that you are focused on a lot more than just that. >> that's why we call it for do smart mobility. we are taking a holistic mobility, the connected car, the internet of things, the customer experience and how technology will enable that going forward and begin to. -- big data. we can take the view of what is the whole experience that the consumer has. it all comes back to us thinking of ourselves is not just an auto company but a mobility company.

we want to drive the business forward. we want to make the world a better place and there is business opportunity for us be on our traditional business. >> you are doing experience all around the world, 20 different cities. downstairs, you are putting sensors on bicycles. i asked my tour guide, are we going to make a bicycle? >> he said electric bikes are big in asia. will ford products go beyond mustangs and explores? >> we are not going to get into the train or large bust business. we are thinking about mobility in a more holistic way. that may open opportunities for us. to provide consumers solutions for how they get around. we are seeing trends in business. it's important to project 15

years out. we are seeing trends around these megacities. trends around the growth of the middle class around the world. trends around increased concerns about air quality. we want to ask ourselves, is there is business opportunity beyond selling more cars and trucks? congestion will become an issue. we are experimenting and we will learn. we will succeed in some and some we won't. it will inform us so when we come out with these products and services we want to make sure that they are accessible to everyone and not just a certain portion of the population. >> i notice a lot of different brands in this building as well. nest, which makes smoke alarms. if i'm driving a mustang, it will say there is smoke.

how key is that, partnering with other silicon valley producers? >> it is very important. that's why we are moving here. we are part of the ecosystem here. we want to embrace the ideas from others and our own ideas. it's the old adage, you can make one plus one equals three. it's all about how do we help customers with their home energy management with nest? it will signal to the thermostat that it can lower the heat which reduces their bills. they get within a certain area and it will pop on. having those partnerships are so important because we can learn from each other and we can bring best ideas together and go forward and not only serve customers better but provide a business opportunity. >> if i'm driving home in my ford vehicle, the nest will know

what temperature i have it in my reactor and put that temperature in the thermostat in my house. >> exactly. we want to make life better for folks. how do we play a role in that? it's allowing us to think -- we are asking engineers to not stop at traditional innovation. think broader than that. thing from a customer standpoint. let's see what happens. magic happens. >> what kind of engineers will we have here? you've hired a guy from apple. a guy from apple invented the nest. we see apple type products? >> we are hiring aggressively. when we are done filling up this facility, we will have 125 folks. researchers scientists come engineers. when the largest research teams in the valley -- one of the

largest research teams in the valley. we are looking for software engineers, business development folks marketing folks come i.t. professionals. come to ford and not only will you have a great career, but you can work on important things. >> matt miller joins me now. that was interesting stuff. i think about divorce a vacation -- when are they looking up to the clouds and taking their i up the ball -- i off the ball? >> they still have the majority of their folks in detroit working on cars. this will be a few hundred people out here. ford has been into this technology thing for a long time.

they don't want to miss the boat going forward. a lot of carmakers are focused on autonomous driving but they are not caching -- casting as brought up a net as board does. not everything will work out but they may hit on something that becomes that one of thing we all need in our cars going forward. it makes a lot of sense to me. they are not devoting so much of their resources that you need to worry that they will stop producing f1 50's in detroit. >> in the auto business, is there a thought of one thing that nobody realized at one would need -- everyone would need? >> when i think about stuff i never thought i would need but i can thatnow not live without, the step in the back of the f1 50

it seems like something i would not have and use for and now i use it constantly. they are finding things like that that have to do with technology. i got my nest installed at home. i will be able to use my car to change the temperature as well. >> you are torturing your dog. you're the only person -- >> i realize that. if i don't wear a tie, i feel about networking. -- i feel like i'm not working. >> we will be right back. ♪

>> on cory johnson and this is "bloomberg west." the annual letter from the bill and melinda gates foundation is

out. the world's poor will get radically better over the next 15 years. bill gates spoke to erik schatzker in an exclusive interview. >> you look at the world as a whole, it is less in equal, more equal now than in the past. that is because poor countries like india and china have had growth rates well above that of the rich countries. within individual countries, the inequality has gone up in almost every country. i think everyone believes in a balance. you should have progressive taxation that as you get wealthier, your consumption, your income, your state -- estate ought to be subject to much higher taxes than the middle class.

i think the u.s. could be even more progressive than that. the thing most people would emphasize that is critical is the equal opportunity. if the inner-city schools are really good and access to health so it's not holding people back or social services -- that's strong enough so we can say every kid has a near equal chance of becoming a doctor or lawyer or going to a good school that is even better because that's about freedom and developing capacity as opposed to a zero sum transfer or you have to be able to fund the things that create that opportunity and taxes are absolutely necessary. those two operating together, taxes to fund it and the execution -- we don't have equal opportunity. it's what we aspire to as a

country but educational loanalone is so poor in the inner-city, we are not being true to our basic credo. >> bill gates and erik schatzker. ♪

>> you are watching "bloomberg west." on cory johnson. -- i'm cory johnson. the company tried to go public initially 10 months ago. the company's financials look crummy, forging talks to -- a bobox to delay its ipo. emily chang sat down with the ceo if you months ago. >> you recently took on order to do million dollars in funding -- $150 million in funding. why did you take that money? >> as he may have seen, we filed

to go public. a week after we filed to go public, there was a bit of a market correction in the tech stock space. you saw a bit of volatility quite a bit of volatility and a lot of sass. we decided it was not the best time to bring a new company to market. we had amazing support from private market late stage investors. they were willing to and interested in supporting the company as a private company. took that money on to allow us to continue to invest in growth and in the business model. building box without going public. >> do you think you filed too soon? >> we should not have filed when we did because we certainly

dealt with a lot of distraction because of that filing. whether that was news reports and the cycle that happened -- had to happen around the business it was an absolute distraction to what our core focus is and has been come execution and building up the business. life is too short to have any specific regrets. we have remained in full execution mode. >> i'm serious what that moment was for you. somebody calls box a house of horrors. >> we are competing against the biggest companies on the planet. in the technology industry. to do that, you have to make a pretty significant investment. an investment in research and development and infrastructure. >> the criticism was that you

were spending more on marketing acquiring customers then you are making. how has that changed? >> every dollar we acquire of revenue is a dollar recurring annual. our job is to keep customers happy and successful at compound that color overtime. -- that dollar overtime. the new investments had outpaced the revenue scale. we are more in a stage where we are focused on growing revenue and that is compounding. you don't have as many of the new significant investments because we have done a lot of international expansion and build a lot of the enterprise sales force. >> how much have you thought about selling box for assisting independent or going public? >> we want to sell our software to a lot of companies but the company itself, we spent 0% time thinking about it. >> you can catch the full interview tonight at 8:30.

they're expressing -- $11 to $13. let's bring in sandy miller. he has seen that some that look like box. i described the editorial. the financials look crummy. it's a remarkable thing how this company spends money so much more on marketing than revenues. >> it's interesting that they have achieved an awful lot. you have a lot of customer traction. a lot of names, do turn 25 -- growing 85%. there are a lot of things that look attractive.

they are spending to get it. they are facing pretty big competitors and they have to spend to get their product into the market. what is interesting is their financials were exposed early because they do not file silently under the jobs act. >> what is your notion of why they did that and with the jobs act might have afforded them? >> we recommend strongly that our companies use the job act and file silently and do the testing in the waters with institutional accounts and then only expose to the public at the time. a lot of what they went through was pretty typical but played

out in the public arena rather than more behind the scenes, which is now allowed by the jobs act. >> i have enormous regard for erin leavy and i was saddened to see the financial state of the company. does it take the process or a rocket scientist to look at a copies marketing costs outstripping revenues and say you might want to do another round and weigait? >> it is not a surprise for private companies to do it. a lot of the major companies build salesforce successfactors -- cloud companies generally often do have to spend ahead of time. the issue is whether it plays out in the public or private market. it will be an interesting test of what the market will bear here. it has a lot going for it and yet it is a big burn.

they're asking the public investors to support that model on a plea profitability -- pre-profitability basis. >> if it goes out of the range it will be worth $1.6 billion. what does it mean for the late round investors? who sees their -- >> the ipo is not a negative. box has been smart here to do a relatively small deal have all primary issuance and price it relatively conservatively. there were adjustments in those private rounds. adjustments in those rounds and prices to adjust to the ipo

price. >> the late round investors keep their percentage even though -- the early investors see their stake in the company squeezed down as a result. >> the early investors -- the percentage differentials mean a lot more to the late stage investors in the early stage. it is not a meaningful change for the standpoint of early investors. i don't know how they sorted out internally at box. it does not have a major impact on the early investors. >> sandy miller, we appreciate your time. thank you. storage has become a crowded space.

can box compete with the likes of microsoft, google? we will be back with one of their biggest rivals, next. ♪

>> clouds are gathering -- they are trying to grow this $2.3 billion according to a report from idc. box shares a space with fierce competitors. here is emc's general manager. i want to talk to you about what it is that happened in this arena that is making it so huge. >> what's really interesting is the way that people work is fundamentally changing. they need to access information from any device at any time.

the reason this is happening is because of the convergence of clout and mobile. you just showed me pictures of your backyard. anyone who has a phone or pc must've have access to information across all of their devices. >> is there a technological change that makes it possible? semiconductors or storage or what? >> technological change when you have something in the cloud comets easy -- with consumerization of i.t., if i.t. -- >> they get used to using outside of the office. i.t. control and security. >> what we have seen is the more

consumer tools are used by users, the more security risks for organizations. i want it to be secure and protected. that's where companies like simplicity come in. >> are box and dropbox and simplicity in microsoft going after the same market? >> we are going after the same market from different vantage points and different worldviews. we believe the customers need a choice in the way they deploy the software. you go to large enterprises, they might want some of the data , but some they don't feel comfortable putting in the cloud. box does not feel that choice is necessary.

we provide that choice so they can choose what data they want. that is one area where there is a worldview difference. it will be interesting to see which one wins out. it's a 24 month sprint. you will see a lot of marketshare being acquired. >> the ceo left in september. what is going on with that business? >> we don't see them as a serious contender. you start to see a lot of players flocked to the market and then the cream rises to the top and you have a group of five players. microsoft emc, google and that box and dropbox. the rest of the folks when not be that relevant.

>> box is a fairly terrifying number. i have a chart up right now that shows the sales growth, the speed of the business, the blue line is the marketing cost and how they are spending so much money and when they stop spending in marketing, the sales growth slows down. he says we get a customer, we keep a customer so it's a one-time expense. >> we have a view that is more similar to yours. we have this advantage with emc where we don't have to spend as much on marketing and sales as much as we do with what they want and emc solution already. >> he has cool sneakers. i think there is some fundamental things they still

have to work out in their business. this is very early in the game so it will be interesting to see how it pans out. >> we appreciate your help with finding out what it means. we appreciate it. bottom line is coming up at the top of the hour. what is coming up? >> we take a look at investment opportunities in egypt. the main trading partner is the european union. how will the stemless moves announced today by the european central bank affect europe's relationship with egypt? is the little -- the political climate stable enough for foreign investment? egypt's minister of investment -- my exclusive interview is coming up. >> can't wait. thank you very much. "bloomberg west" will be back right after this. ♪

>> let's look at the big

picture. the online marketplace for stock photos -- they have been off to a shopping spree. there purchased -- they snatched up a music library for $32 million. the founder and ceo -- who are the principal users? >> the people that use shutter stock are businesses. we sell images to companies of all sizes. images to sell their products and services and advertise their products and services. we have been expanding into video. we have been expanding into audio for commercially released stock music. he recently purchased an editorial agency.

an expanded further into the music. >> to the old into a more single offering for a customer? >> today, their individual offerings but we plan to merge them into one. you can access them all from the shutterstopck website. they are sold under a sick licensing terms, royalty-free -- basic licensing terms, royalty-free. we plan to make it easier and easier for companies to access us. >> writes is always an issue -- what do you do to police rights? >> it is different for every asset type. for our core product, it's a crowd sourced product. we have 70,000 could you readers. we get 60,000 images added every

day. anyone can contribute stock video and we sell it to all agencies and even hollywood studios. these against markup located. -- music is more located. yet know the producer -- music is more complicated. you have to know the producer. the video commercial licensing space is changing so quickly and people who need video also need audio. >> i came across a statistic that i try to pack check. more photographs or images have been taken in the last two years than the previous 100 years of photography. do you see that in some way? our selfies are filling the world with images? >> we are all photographers today. i believe it.

we can all shoot high-quality images. you can upload them instantly and get feedback. you can get tips and tricks from people online so you can accelerate your way to professional a lot quicker than you were able to in the days of film. >> i grew up in rochester where kodak was everywhere. it is amazing what has happened with the world of photography. >> it is interesting. the entire space is being democratized. it was difficult to become a professional photographer 20 years ago. very expensive. you had to buy lenses that cost thousands of dollars and you had

to develop film and it took weeks before you learned what you were doing wrong. you had to keep shooting and developing interpreting. that process has been accelerated into a split-second. you look at the lcd display and you instantly know what you need to get better at. we have 60,000 photographers around the world creating amazing images for us and we get hundreds everyday. >> thank you. the bwest byte is where we focus on number w. >> the bwest byte is 758,000. gillette has predicted the brand exposure value because of the replays of bill belichick's press conference earlier today.

>> it's about deflate gate and it says flex ball. >> maybe it's looking in the wrong direction. >> did you think you noticed it was behind him? >> one of the reasons why companies paid the big money to have their logos featured behind the sports stars. it's not all going to be about good news. >> maybe it helps them what their message. he did not even know it was behind him. >> see no evil, hear no evil, speak no evil. they don't know what happened with 11 out of 12 balls. >> you get the headlines on

bloomberg.com and bloomberg radio. more "bloomberg west" tomorrow. ♪

>> from bloomberg headquarters in new york, i'm mark crumpton. this is "bottom line." to our viewers in the united states and those of you joining us from around the world welcome. we have full coverage of the stocks and stories making headlines today. matt miller is an palo alto getting a firsthand look at ford's new research and innovation center. lisa abramowitz says pay up for safety or by risky