cory: from pier three in san francisco, welcome to "bloomberg west." i'm cory johnson. full coverage of apple's big event in san francisco where it will re-announce its latest device, the apple watch. first, let's get a check on our top headlines. eu finance ministers warning greece it has to pick up the talk to secure more bailout fund. greece will run cash in three weeks unless it gets more aid. >> we have said we would support greece further if they continue on the reform path.

i think that talks about the program and the reforms that are needed should restart very quickly. we are losing too much time. cory: a preliminary four-month extension started last month but the latest proposals have been inadequate. mall owner simon properties offer to buy its competitor. the offer comes after macerich refused to talk about previous deals earlier. most of their properties are located in call-up on you and arizona. mcdonald's things keep getting worse. a report of nine straight months of declining same-store sales. in the u.s., sales were down 4% in february. the stock is up as the new ceo begins his second week on a job. mcdonald's also says it

recognizes it has to adapt to changing customer tastes. president obama is launching a new program to train for high jobs -- high-tech jobs. it will provide training and job placement infield fly deals like software development networking, and cyber security. >> we still have to produce more engineers and computer scientists but there are all kinds of things that are being done within companies and different sectors that can create great careers for a lot of people. and so what tech hire will do is connect local leaders with the job openings to the training programs to the jobs. cory: the government will provide a combined 100 million dollars in competitive grants to cities that take part in the program. star board valley pushing yahoo! to spin off yahoo! japan. in a letter to ceo marissa

mayer they say they could unlock $11 billion in value for shareholders. in january, they announced plans to spin off its alibaba state. shareholders still have substantial skepticism about energy. now to the lead. tim cook will be taking the stage for the re-announcement of the apple watch, which has gotten underway moments ago. originally announced in september along with the iphone 6, a new watch's critical details will be revealed today price, launch date, and more. this would mark apple's first foray into something that is really fashion-like. brownstone is with us from europe when. -- yerba buena. also with us is paul kedrosky an apple watcher.

since you are at the site, tell us what you are looking forward to most with this announcement? >> probably the apps. to put it another way, why should people buy an apple watch? we got an indication in september, it would perform the functions of a health band would connect to your iphone. but from the channel discretion six months ago, it almost sounded like it added more complexity to your life. what apple and tim cook needs to do is to make a case for this new device that really just tethers to your iphone. why bring this into our lives? i expect to talk about prices and a different skus and how they will sell it, but to bring in app developers to show us what we can do with the watch. there have been skeptics because they have not presented a

compelling reason to bring this piece of technology into our lives. i think apple has its case -- work cut out for itself to make its case to the customers. cory: paul, you are a runner a tech geek. a source of mine says that strava will be in there. his fitness the principal focus today, and what would that mean if it was? >> i don't know. i am really torn on a question and if i have not seen what carmen was doing -- for example -- the garmin product is a fantastic product that in many ways, is what a lot of fitness people who the apple watch could be, but innocence never can be. competitors are producing some compelling products on the fitness front. i don't think this is the place anymore. i think it is more about fashion and broadly help, but i don't take the fitness market will crumble in the face of anything

that apple renounces today. cory: let's talk about that garmin watch. they have been at it for a long time, they were making personal navigation devices, they owned in business for a long time until the iphone got to a certain level. all of a sudden, people are putting phones on the dashboard of their car and has her their devices. do you think competitors understand what apple tries to do now and does it before then -- them? >> i think so, and i think they have learned to retreat and dominate in certain categories. then leave the broad categories to apple. that was the lesson of the first generation of apple products that really interviewed on the turf of people like garmin. what companies like garmin are doing this time around is retrenching and going deep into

hiking and active navigation the people that do that kind of stuff. that goes into the 920 products from garmin. the apple watch will never be a competitor to those products because they are so specialized. cory: in terms of other apps, tim cook spoke recently at goldman sachs, and he talked about messaging, apple pay, the things that would happen in a room when everyone has the watch. they would all stand up at the same moment because they would all do the same notification telling them that they were inactive. >> there is an opportunity for the watch to create a personal identifier, a key to the physical world. tim cook talking about opening up a hotel room door perhaps starting your car one day. of course, apple pay. making it even more seamless so

you don't have to pull up your phone and put your fingerprint down to pay for something. just swipe with your wrist. if the watch can make your life easier to navigate, then perhaps it is appealing. maybe we are overthinking it a bit. what apple is trying to do is to create lust among consumers. there does not need to be a rational need to buy the device. if it becomes a status symbol, if people simply want to buy it, that is something that they are clearly out to do today. >> i think it is even more straightforward than that. apple -- we are cruising these of certainly large phones that people find a nuisance to take out of their pockets so there needs to be something more portable where people can look at stuff and short of having something planted in your retina, it is a watch. cory: paul kedrosky, brownstone thank you. tim cook is on stage talking

about things not watch related. talking about tv deals, the stores. talking about a standalone hbo service for the first time ever. they say it will be the initial launch of the provider of service. of course, showing a "game of thrones" trailer at the event. a lot more of this coverage. thanks to brad stone and paul kedrosky. we will be back right after this. ♪

cory: welcome back, i'm cory johnson. apple re-announcing their watch across the way in san francisco. tim cook taking the stage talking about a bunch of things. they say a date sold -- they sold 22 million apple tv units since its inception and will be lowering the price from $99 to

$69. also 700 million iphones sold, no big surprise there. a lot more about that and more on the apple watch. let me take you through a few headlines across the world as well. germany's commerzbank is about to sell a multiple -- accounts of that agencies and wrap up some long-standing investigations. the bank had $1.5 billion to settle the charges and avoid prosecutions. the bank has been accused of violating u.s. laws and played a major role in the accounting scandal. investors will $18 million from bill gross's fund in february, the first time since he joined janus last fall. the fund decline .8% this year.

nfl free agency does not start until tomorrow but a lot is going on already. the miami dolphins close to signing suh for $114 million for six years. that would make him the highest-paid defensive player in the history of the game. speaking of sad news, 49ers pro linebacker willis planning to retire. he is only 39 years old. lead apple designer johnny ives works with a small team in a locked area unseen to the outside world. but his team is growing, hiring mark newsom. so where does designed to lead apple, or where does apple lead design? design is such an interesting

thing with apple. more than any other company, their work is associated with design. as we look at the apple watch, is it function or design first? >> what's interesting about apple is we look at them as a technology company but they are usually a follower on the technology front and they come in at a moment when we are moving not an early adopter space, but into the early majority, and then also need to capture the late majority. in this case, they have seen a number of other people entering the smart watch market wearables they want to get closer to the body, own some of the real estate on the body and get into that. cory: i almost felt like they ceded this. by letting the world they were looking at watch for almost two years, competitors were spitting stuff out, some of it really ill-conceived. samsung motorola, the startups

like fitbit and jawbone. it almost seems like they want other people out there to take the arrows and experiment so they can figure out what the world should be. >> they have learned being first is not necessarily as important as being best or better than most. they can learn from the mistakes of others. we have seen this telegraphed in a number of ways. we have even seen the evolution of the design language from the apple laptops shifting from a hard edge to a softer edge. we went from that specifically perfect radius corner to a bit of a softer, more elliptical radius. then you saw that on the ipad and then from there onto the iphone, which got softer. as a get closer to the body, that is the form that we will want to have, where it will not snag on clothes. cory: i want to talk about the bands in particular, but i want

to talk about some of the headlines. tim cook talking about apple pay, more than 2500 banks. car play which fits into what we are talking about, simplicity in design and what that means to apple. he says more than 40 models of cars will be shipped with their apple car play installed. we know it takes a while for carmakers to catch up to that, but they are trying to lead the way in the design experience inside the car. >> there is a time who were going on in the connected car space. there i would say they are also following in with a bit more polished product. cory: let's talk about what fashion is. let's get really high-minded. apple's device -- their approach to devices has been, this is a customizable device that you can make of it what you will. you can use it what you will.

you can use the apps that you choose. you can put a picture of your family or a design that we supply you, but it is yours to customize, everyone gets the same thing. the watch appears to be something different. here is the basic version, here is the fancy gold edition. is that a change, to be something that is fashion? >> fashion plays on two different levels. this is the way that we express to the outside world who we are and what we stand for. so this element of individuality and expression. at the same time, there is a element of belonging. i am affluent, therefore, i dress affluent. i in a tech entrepreneur, i am in a hoodie. here, you have similar circumstances working were apple is allowing you to signal a bit perhaps with a gold watch, or not, and to morph that look a

bit to say that i'm into sports as opposed to gold. at the same time, you are joined this group, so it is no longer possible to say think different. cory: you are not completely unique but are identified with a group, so give us your $600. >> that is the challenge. you are identifying strongly with a group and a wearables which is seen all the time as opposed to being in your pocket. cory: the head of venture design. we could talk about this all day. please come back. ♪

cory: i'm cory johnson. this is "bloomberg west." the apple event is going on, the renouncement of the apple watch.

of course, the question is, is the watch the next big thing with consumers and businesses already entering a busy smart watch market with lackluster sales? can the apple watch do better? joining us again is paul kedrosky as well as an analyst who covers wearables. cliff, what do you expect in terms of units sold, and why do you expect that? >> thank you for having me. we are optimistic on the opportunity at about this team .4 million. we think supply will be well supplied -- will be well matching demand. -- 15.4 million. the diehard loyalists, the fan boys will camp out outside of the stores. you will get may be 3, 4 million in the first month that way by our estimation. steady uptick to the year and seasonally pretty good holiday

buildup. the reason we are so optimistic and believe apple will legitimize the space is they bring the design pedigree and they bring the designer-curated options on to the wrists of users. history has shown it is pretty unwise to bet against apple. we are expecting something new in the smartphone user interface. hopefully a new metaphor for a nagging beginning -- navigating a smart watch. the sidewinder crown is maybe the tip of the iceberg. we will see where we go from there. cory: paul, any time someone tells me it is unwise to bid again something, i become very interested in betting against it. 3 million seems like a big number for me in the first month. >> looking at the numbers

floating around, they are uniformly surprisingly large. with the exception of the outright skeptics, you see numbers of 215,000,001st-year unit sales. these are colossal numbers when you think about android smart watch sales. -- 215 million first tier unit sales. what this implies implicitly is that the bet that the mistake that everyone made in the past and they did not make it an accessory to their phone. it requires the phone all the time, this presence of the phone, so it is really an iphone accessory. the bet is that apple has gotten that right and people want this accessory to their iphone. the early numbers suggest consumer uptake has not been that great compared to anyone else, but i'm still skeptical. i don't think the numbers will happen, but kudos to them if they can pull it off. cory: cliff, when you look at the smart watch business, call

me the argument earlier, there are competitors. garmin has a great device for athletes. fitbit and jawbone are great for the casual walker. does this do everything a little bit, is this going to grow the market? >> i think it will. if you look at what happened in the mobile world conference in barcelona, we saw that fashion and convenience, trying to make a watch that looks good trumps functionality. we will see a blend of both here. what does apple have up its sleeve? it is not in their contemporary dna to introduce substandard experiences. even in the cook era, we will not see a watch without something john dropping. with the battery life required, they have the ability to think three-dimensional he. a new ui, some impressive launch partners.

so far, the applications tend to have their counterparts in the ecosystem. cory: we have to go. paul will stay with us. thank you as well. more from the apple event as it happens right here on "bloomberg west." ♪

cory: you are watching "bloomberg west," where we focus on innovation, technology, and it teacher of innovation. there is a look at your top headlines. president obama says the u.s. is willing to walk away from nuclear talks in iran if they do not meet the u.s. terms on limiting capabilities. >> if there is no deal, we walk away. if we cannot verify that they are not going to obtain a nuclear weapon that there is a breakout period so that even if they cheated, we would be able

to have enough time to take action if we don't have that kind of deal, then we will not take it. cory: talks have tested ties between the u.s. and israel. benjamin netanyahu says a deal would only bring iran a step closer to acquiring nuclear weapons. president obama also extended u.s. sanctions against the venezuelan officials as president nicolas maduro attends to stifle dissent in his nation. he has blamed the u.s. for supporting what he calls an endless coup against his government. an ultralight plane powered only by solar attempting to fly around the world without using any fuel. the plane called solar impulse took off from abu dhabi this morning in the first leg of the 21,000-mile journey. it is expected to take five months before returning over the

atlantic. back to the big event in tech. apple presenting new details on its highly anticipated watch. brad stone has been monitoring all of it from outside the yerba buena center. what do we know so far? >> we do not have anything about the watch. tim cook is not started to talk about it. they cut the price of apple tv from $99 to $69, will support hbo now, the over-the-top streaming service. he also gave an update about apple pay. he says it is not accepted in over 700,000 locations. here is his update on apple pay. >> apple pay has forever changed the way that we pay for things and has gotten up to the most amazing start and has enormous momentum. we started with just six banks

in the u.s., the largest banks, a fantastic start, but now we have over 2500 banks supporting apple pay. we started with a great list of retailer partners, but now in just three months later, we have tripled the number of locations accepting apple pay, to nearly 700,000 across the u.s. and one of the really cool and convenient places that has come up in apple pay our vending machines. coca-cola now has 40,000 of these in the u.s. and plans to have 100,000 by the end of the year. so if you are like me, you have stood in front of those machines too many times trying to uncrink le your dollar bill getting it to be recognized. those days are over. >> tim cook is on stage now

talking about a new macbook. i hear it will come in gold. people will be lining up for that. the other news so far is a new tool called research kit basically turning iphones into a diagnostic tool, allowing researchers to design experiments that users can opt into to measure things like there and duty -- like their activity, health levels. cory: very interesting. i wonder if that is not a foreshadowing of the health focus of the watch. brad stone thank you very much. we appreciate your hard work. there is a lot going on with this watch and how it will function. as we learn more about it, there is one thing that will make or break the watch, and that is battery life. a lot of issues about smartphones maintaining their church. imagine if a health device stops monitoring you because it lost its charge. what are the challenges of making a tiny long-lasting

battery, what have they given up to make the watch skinnier? an expert is with us now in smart energy. when you look at this watch, what are the design trade-offs and they made or battery versus -- what? >> it comes down to better materials. the materials in today's watch and the iphone are the same materials used in the old phones in the early 1990's. the energy density is not enough. that is basically the amount of battery capacity you can put in a given volume. when you have a small device like a watch, lithium-ion batteries simply do not have enough energy density, battery capacity to power you throughout the day. cory: i think we get used to innovation and technology that will follow moore's law, first of all, is a marketing principle

, but there is no moore's law for digging ditches for fiber optics no moore's law for three printing, and for batteries. what is the pace of innovation in the world of batteries? >> necessity really is the mother of invention. before the watch and the iphones came about, there really was not a need for these high energy density batteries, but as they become more popular, there is a lot of new technology in the pipeline being developed with silicon materials, other materials, and we expect to see this in the next generation of iphones and maybe the watch and cars in a few years. cory: one of the components of a lithium battery that could be made thinner with different materials -- what are the components of a lithium battery that could be made dinner with different materials -- dinner with different materials? -- thinner with different

materials? >> basically, the cathode in the device is next out, but there are improvements to be made on the anodes. people are working on silicone anodes. peaceful also working on metal anodes, which would double the amount of energy they can put in. cory: is there an expense trade-off? if the watch were an inch thick, would you be able to use it for a week? i use a heart rate monitor. it has a green light in the back. it is mad at me because i just took it off. this will last five or six days without a new charge. are the things they are asking of this apple watch so complicated or so energy inefficient that it will not last quite as long? >> obviously, there is a trail with it performance. -- with performance.

the more you use it the faster the processor, the higher quality, the drains the battery much faster. with new materials you can still have the richer experience but still have a watch that last a few days. cory: we have also heard they had turned off a handful of sensors that should have worked on the phone but decided not to use it. it suggests that that is about battery life, is it? >> with the apple watch typically, if you use it on standby, you expect a couple of days. but if you really use it with the apps and sensors running, you will probably have just a few hours. cory: maybe they will give us some guidance on this last question. if they tell us the watch is good for 24 hours, should we assume, based on their history of describing batteries, that it will go longer, or should we ask

whom they are exaggerating and it will be shorter? >> i believe with the apple watch, you are expected to charge every night, as you do with the iphone. cory: we shall see. thank you very much. bloomberg will be right back. ♪

cory: i'm cory johnson. this is "bloomberg west." apple's tablets and phones have attracted customers for years and the smart watch model could put them at the top of the fashion market. certainly there spread in "vogue" would suggest that. paul kedrosky joins us from san diego. we also have joe jackman, a brand strategy and marketing consultant.

various companies having success getting close to luxury. can apple be a luxury brand, or does it just me to be near them? >> my first response is apple in its category, is near luxury or affordable luxury, simply by the way that it invests in the design, user interface. this is a stretch for them, but not a far reach in my view. cory: paul, what do you think? >> you read back to the walter isaacson binary of steve jobs and this is something that he talked about. jobs talked a lot about the idea that he did not think about companies like dell and microsoft in the way that he wanted to position the company but you thought about mercedes and bmw, these aspirational or near luxury products that can create a price premium and have the mortgage -- margins that lend to that. in a way, the luxury market is the jobsian way of thinking.

cory: we have seen a number of high retail brands losing their luster. i am thinking of perry ellis. someone who has oversold their name to everyone who can make it, so it became meaningless and cheap. >> that will be their challenge. if you think of luxury, it is two components, exclusivity and experience. on the experience side, they will have to improve and they have announced they will make changes to their store experience. luxury sales do not typically take place on hard surfaces there is carpet. there is a contingency -- intimacy level to it, a service perspective. as good as they are with their service, there would be some changes. on the exquisite side, there would be something of a shift. we may see creative collaborations in the future with designers, position to a greater degree.

-- customization to a greater degree. certainly, if they play it well we will see them limit the availability of certain designs. these are really hallmarks of luxury brand development and retailing. apple will have to learn its way into that space. given what they have done and to the point made earlier about jobs' philosophy, this is well within their grasp. cory: i think about inventory risk, going back to innovation, but should we be thinking about it as limited runs that are all about establishing brand, as opposed to selling stuff? >> i have to believe that we are all kind of wrong about the luxury end of this. this will be a very small and tangential part of the apple watch business. it seems so antithetical to the culture of the company. in the or-luxury part i get, but the exclusivity part, where we

start building around scarcity that is so antithetical to the company itself the dna of what apple always wanted to be. they were the opposite of ibm, wanted to provide these products for the rest of us. in a sense, a lucidity was not part of the selling message at all. they will probably do side projects where they work with other affiliates to do this kind of stuff, but to make it core to the product the risks from inventory to branding, i would be really surprised if it is a big part of the pitch. >> i was just going to build on that point and say that you are 100% right. design for all borrowing a target phrase -- this notion that everyone can experience something better and have an appreciation for design and functionality user interface of a different kind. apple has done that. it is, can they make that shift

-- these are objects, things that are desired in a way that is different than mass. i love the idea that maybe this is the mission, to make what might otherwise be seen as luxurious, available to more people while still coming off as genuine to the brand. cory: joe jackman, paul kedrosky, we appreciate your time as always. let's bring you up to speed with that binds. alcoa spending $1.2 billion to expand its aerospace unit. the company agreed to buy rti international metals to expand its titanium and special metals role. asia airlines flight 3 -- malaysia airlines flight 370 was

flying with an underwater beacon that had expired. it was also caring for hundred 80 pounds of lithium-ion batteries that did not undergo normal screening, according to an interim report released one year after the plane disappeared. of course, it is still not been found. don't say climate change or global warming in florida. employees of the department of environment protection have been ordered not to use those terms in a fisher communications according to the office of governor rick scott. governor rick scott. governor scott was a skeptic of global warming. he did not want to hear it. "bloomberg west" will be right back on the latest with his apple press announcement. ♪

cory: welcome back to "bloomberg west." i'm cory johnson. the apple event here in san francisco is underway. it is time for the bwest byte.

>> the bite is 13.1 millimeters the maximum thickness of the new macbook. tim cook just introduced an onstage, a totally redesigned device. it comes in gold. here is tim cook introducing the new computer. >> we challenged ourselves to reinvent the notebook and we did it. here it is. [applause] it is unbelievable. can you even see it? i cannot even feel it. there goes. -- there it goes. >> perhaps the most interesting thing about the new macbook, it has one port. throw all of your old cords away, they are trying to

streamline this device. consumers will line up for it. cory: this is about 10% thinner than the ipad air. charging about $1300 to $1600 for this. my birthday is coming up, just saying, paul. they are gaining market share faster than any pc maker. what do you make of this? >> this does not get talked about enough. apple continues to dominate the sorts of ultralight notebook portables. we talk about watches, ipads, iphones, but the reality is when you look at something like wire cutter almost to the point of boredom, it is, apple has done it again. the macbook air is the best in the marketplace, don't bother shopping. that is a pretty remarkable achievement in a market as competitive as it is. to do that from a business

standpoint is even more impressive. it is easy to say that this is pointless innovation but it is a remarkable franchise that they have built cory:. you wonder --cory: you wonder what this means for the iphone 6. now you have this device, as thin as some of the first ipads. is there a sense that they would just push the fitness -- t hinness thing across the board? >> it certainly seems like apple has an unhealthy fixation with thinness across this product line. this is why people gravitate to the apple product line, why they are able to charge a premium. they just announced a price, starting at $1299. that will cost you more than most laptops, certainly more than a chrome. -- chrome book.

cory: i have heard it said that it is proof that and coulter is proof that you can be -- ann coulter is proof that you can be too rich and too thin. >> this is a product -- what is it now, 11 hours battery life? it is the kind of product that 15 years ago when the first notebooks were coming out, these gigantic things look like briefcases, you thought there was no way this thing would ever become truly ubiquitous device. but that is what they have created. it gets overlooked in all the hyperbole with everything else but your point about squeezing the ipad is a good one. the six plus is taking up a lot of the lower space, and this is coming down in the sense of size

and taking up some of that ipad space. it will be the ipad that will continue to be crushed at both ends. cory: it is interesting. this is a 13-inch unit, new macbook pro. three colors, gold, gray, silver. with an intel chip inside of it the intel m chip. no fan. they are giving the extra space over to extra battery life. for sale on april 10 between $1300 and $1600. brad, what does that price point till you -- tell you? >> that apple can command a green mp or we are living in the age of the $500 notebook but apple continues to raise the technology bar and do new things with materials. new things with the display. and battery life.

that is why they are able to charge a premium and why it is an insanely profitable company whose market value is pushing $1 trillion. cory: tim cook is on the stage now finally talking about the watch product, a certain way that they would use them. something called glances, an app for the things that you check most frequently decide the time. maybe text messages phone calls, certainly a consideration to battery life. we will keep his apple coverage going live through the commercial break so we don't miss anything. we have heard about different kinds of apps. should we think about it in terms of the things withat they have taken out, not to be part of the first generation of watches? >> i don't think so. the lesson of the fitness watch is other than the hard-core fitness people that used in cost to play, most people think, that

did not make me dinner in six month so i don't need to use it. in a sense, that is not the market they want to be facing. there were numbers out this morning where they had done a survey in a four-star market research group and found 40% of consumers were interested in the watching closely for that reason. they wanted something where they could quickly glanced down at a device on their wrist and see here is my latest notification. whether it is to do-type stuff, messages from social network, that is what people wanted. i was surprised at the percentage of people who exclusively that was what they were interested in glancable information. cory: he just talked about digital touch, which allows you to have watch-to-watch communication. this separate ios is

interesting. a different operating system for this much compared to any other device, requiring app developers to be up against it if they want to be on this watch. >> that is why apple introduced this six months ago. developers have needed a lot of time to not only tailor their apps to this different device but also to figure out what kind of utility to bring to the customers. glance-ability is key. we will see if anyone has figured it out. so far, tim cook is talking about the way that the watches work together, using your phone to receive phone calls read e-mails. we will see what third-party developers bring to it. cory: in your role as a venture capitalist, have you done any

fitness venture capitalism, why or why not? >> mostly just regretting that i was not in strava. there are some remarkable companies out there that have really exploded and done fantastically well. as a category, we are actively adjusted in and companies have done a true rocket liftoff in terms of growth. that comes as a huge surprise to people. these fitness-focused companies not only have initial interest but long-standing support. strava will see millions of new segments on a daily basis. this is where you can keep track of what your friends are doing and compete on who is the fastest running up the street which sounds trite, but people become him swords into these social athletic things embedded into technology now. it is an interesting category. you said this earlier, strava will be one of the first apps showing up on the new watch.