gain momentum following her razor thin victory over bernie sanders in the iowa caucuses. the gimmick credit party said it was the closest result in its party history and will not do a recount. the sanders campaign spokesman said they would not challenge the results. marcouz is criticizing rubio and donald trump on immigration. stopping in new hampshire, senatorcruz said that rubio led the fight for amnesty for immigrants in the country and mr. trump did not do anything to fight immigration raged on the debate capitol hill in 2013. secretary carter says the pentagon will consider quadrupling what it spends on troops and training in europe. it is part of an accelerating effort to deter russia. the secretary says that russia is a challenge, but added that balancedn is taking a approach in its former cold war enemy. the steward for detroit's

troubled schools is leaving the job earlier. he completed work ahead of his 18-month schedule, with governor snyder pushing the legislature for state funding to address the state debt. that's global news. i'm mark crumpton. i'm emily chang and this is "bloomberg west." ating up, slash and burn yahoo!, cutting jobs, winding down legacy products, and addressing strategic alternatives, but what does that mean? and we hear from oracle ceo mark hurd of what it takes to be a leader and what it takes to keep competitors at bay. we check out how mega cabs compare with the biggest companies over time -- mega caps

compare with the biggest companies over time. but first, to our league -- alternativesing for the core business. is that the company putting the for sale sign on the door? for the time being marissa mayer exploring aosts and spinoff of the web business rather than sell now because they feel it is kinder late -- it is currently undervalued. is up 12%.revenue but here is what chairman maynard webb added in a news release -- the board also believes that exporting additional strategic alternatives in parallel to the execution of the management plan is in the best interest of our shareholders. i want to bring in our bloomberg intelligence analyst to breakdown the numbers, but what

does this mean? what exactly are they trying to say here? -- first, ao things spinoff will take nine to 12 months and the strategic options were with with respect to the alibaba state and not the core business. you are saying they are not saying we are going to sell. reporter: yes, and they talk about patent sales, corporate headcount reduction -- they are trying to simplify yahoo! is mercer mayer here? is she saying she can turn it around? or is the ship going down? she is trying to basically simplify the company as much as try to focus on the division that has been growing and inspire growth. this: mobile and video --

is an acronym she made up. how well is the is missed doing? is the growth enough to sustain this for the future? reporter: that is exactly what their needs to be more transparency on from yahoo!. what is the user activity? grown froms has almost nothing to 34% of gap revenues in four years, but if you compare that to something like a facebook, now they have 80% of their ad revenues coming from mobile advertising, and they were very low four or five years ago, too. on a relative scale, it's not growing as fast as competitors, but if you look at absolute numbers, yes, there has been strong growth. i think programmatic is doing well. shares are down in after-hours trading, so of course we will be talking about

how investors are looking at the announcements here, what they want -- if they still want to pursue a proxy fight. taking it down for us. now we are going to get back to yahoo! in a few, but i want to turn to competition in the cloud -- where microsoft, amazon, and google has been gathering steam. our editor at large cory johnson is standing by at the headquarters of another cloud contender and that is oracle. he has an exclusive conversation with oracle ceo mark hurd. cory? thank you, emily chang a bloomberg tv, bloomberg radio as well. we're sitting down with mark hurd, ceo of oracle. thank you. you're going through an interesting time in oracle. you have gone through changes. you have gone through a ton of acquisitions. now we have this huge change, the move to the cloud. lookso me about what that like for oracle which has a

strong footprint in on premise software. the development of cloud software has been targeted at oracle. what does that mean for the industry? mark: it is a big shift. i think you will see a majority i.t. shift to the cloud. for us, we look at this as an opportunity. premisesuch a strong on -based, it will be important to make those worlds were together. building a whole new stack of capability through platforms, infrastructure that can work with that on premise base, that's a huge opportunity for us. cory: some of the contenders say they don't have to work together. throw out the baby with the bath ater with the cloud software. newer companies, why are

they not just starting with the slate clean? vendors are interesting, but customers probably have a different answer. have a long set of applications on premise and they have to run their businesses every day. don't get me wrong. the bulk of work is moving to the crowd, but for a long time, you will have to get applications that work together. the ability to share information. i think it becomes a key advantage. most of our competitors are. or -- purely on premise or purely on the cloud. the cloud, the argument is it is so much cheaper. you guys also have a difference of the pricing strategies from what is going on. work?u make that

-- how do you make that work? mark: i do not know if i would call it cheaper. it is more variable. to be able to shut something off when you don't need it, to get a variable price -- i would not say that is cheaper. betterallows you to have control of your costs. for us, we love the cloud world. we love the on trend world. both business models are extremely attractive. we are about as agnostic as you can imagine. we are invested in driving our cloud stack and that is what we're focused on. that transition to the cloud. cory: your competitors like to talk about what you're not doing. talkingn particular about how they are stronger, cloud growth, comparing it to what you guys are doing.

how do you view s.a.p. is a competitor? mark: idol think they are doing very much. to be very frank, they have acquired some properties. cory: do you mean things like concur? arriba is a, property they bought. the core franchise is really erp. that is the core franchise that company is built on. they have not done any work from the bottom up to the architect -architect to the club. long run customers want to move those rp's to the cloud. just to give you a quick view of our progress, we have sold -- i guess by the end of the year, we will probably be between 2000 erp solutions in the

cloud. it's a staggering number from zero a couple years ago. erp solution pure -- colleagues have referred to their acquisition of -- what are we going to do next, buy dairy queen? completely agree with her comments. strategically, it did not look interesting. strategy, ande a then build to that strategy. it has to make sense to us. a dairy queen would make as much sense to us as buying concur.

it did not align strategically where we saw the market going our what we thought was important for our customers. you think we will see oracle doing a serious acquisition sometime in the next year or two? mark: i know you know i'm not going to comment much on forward-looking -- just wonder your philosophy. how do you make those decisions question mark you guys are famous in the m&a world, giving answers. you do the diligence, given answer whether you are interested or not. mark: we know what we are doing. we will do what we always do. something will have to make strategic sense for us to acquire it. it has to make financial sense. we have to be evil to operate it -- we have to be able to operate it. disciplined acquirers. we don't buy something just to buy it. some ofen you look at

the fast software companies, those valuations, i would say, are really high right now? do you look at that? mark: they are high and they have been high for a long time. we have tended to be a first mover. we do not buy a company on the cheap. we buy the best property in that important.use it's whether we build it or whether we buy it, we want to be the best. cory: do you think it is the time to sit back and keep some powder dry in case some things go on sale? mark: it's always an advantage when that happens. it's always better when things cost less. if you look at our history, that has not driven every decision we have made. we make a decision based on the right thing to do at the right time that fits with our strategy and we made a lot of acquisitions back in -- these

days may be wrong, but the end of 2010, 2011. leo, a couple others. it was so important. our future product line was just now coming to market. we're buying multiple companies and learning so much about the business and taking leadership positions. learnwhat you think you from the sun acquisition? surely you tonight at the numbers to be as hard as they've been. if you look at the sun acquisition, which predates me a little bit. think you have java, the most popular programming tool in the world. just that asset in isolation was

really important. on top of that you have solaris. you've got probably the best operating system -- probably the abrasive to me world. you had an increase little -- system that came with it. it was an acquisition that brought a lot of technology with a lot of customers. cory: when i look across the some at your competitors, are struggling, some aren't. if i had to pick which companies were in more trouble, sap, ibm -- which companies have the wrong strategy, wrong products, most wrong? great question. i think i will stick with i would rather have our hand than any other hand in the industry to make thesed transitions. there is a reason why every company does not get to the other side area it's hard.

it's hard to do it in the public markets. look at the investments we have had to make. when i got to oracle, i think our r&d was $3.8 billion? we are probably only path to $5.2 billion this year. cory: huge numbers. mark: huge numbers, but we have had to invest. investedad to transition. we have to keep the capabilities and play at the same time we invest in new cloud capabilities. think about this, cory. cloudou get into the business we have to build data centers in 20 countries around the world. that's like building hotels before you can rent a room. we have had to invest in that capability. simultaneously we have had to build out a larger go to market organization and make all of those investments and if you are in the public markets doing all of those at the same time, it

can be a challenge. there's a lot of companies and you have mentioned a few, that it is hard to get from here to there and i can tell you why. , ceo of torque will, thank you for your time. back to you guys. editor at large, cory johnson, thanks so much there, with mark hurd. still ahead, we've got to keep digging into the latest news from yahoo! as the company cut its workforce and explores alternatives for its investors. will it come investors or trigger a proxy fight? ♪

emily: let's get straight back to yahoo!, shares ticking down in after-hours trading.

marissa mayer planning to cut 15% of jobs, leaving yahoo! with about 9000 employees, and winding down a legacy of products, closing offices, and yes, looking at selling parts of the company. i want to bring in our deals were alex sherman and our guest eric. will start with you. how do you translate what they say about strategic alternatives? are they exploring as sale of this company? ambiguous at best. at some point she did say that board was going to explore the sale of strategic alternatives, which means the sale of the company. she was not very specific about it, and i understand from other reporters the board has said they will explore the sale of the business. the core business.

emily: at least in after-hours, not reactingrs are kindly to this. is she asking for a proxy fight? alex: it depends on what we see between now and april, i think, emily. with theg goes forward sale of the company or perhaps sale of nonstrategic assets, i don't know that i fully believe -- we will see what happens with yahoo! -- i think the discussion will probably be based around the entire company. if nothing moves forward with that between now and april, yeah, i think marissa mayer may be in for a proxy fight. i think be included in that language and all you have to do is read our story from three weeks ago when we reported that the board was warming to the idea of selling the entire core business. that is the way to appease angry

shareholders at this point. a think we have probably reached the end game when it comes to selling the entire business, and there's a lot of confusing language today and certainly morris is going to move or word with a turnaround land because whether you sell the company or not -- turnaround plan because not,er you sell the you're writing the ship is probably good idea. i know my job is going to be trying to figure out who they are talking to and when they are talking to them and exactly what they are talking about, if in fact they are going to sell the entire business. how much money you they would give her that business? emily: alex, i will try to help you with that. doing the best i can. talk about where the business is now and what the business is doing. take a listen to what marissa mayer had to say about the

mobile business. marissa mayer: we will continue to drive native through same time -- at the we will stabilize and slow declines in our legacy revenue. when you look at the mobile and video part of the as is, how well is that doing? eric: not well. if you look at the waterfall that they offered to us during voiceall to show us where revenue is going to go from this year to the next, the maven revenue is only going to 200 million dollars. it's not doing well. this is not a credible plan. this is the turnaround of the turnaround, and it's a little that today is groundhog

day because it's groundhog day for yahoo! emily: déjà vu all over again. and our ownpeau alex sherman. iswe had to break, uber rebranding. many critics taking aim at the new logo on twitter, saying it looks like a doughnut, and basketball court, even a pokeball. ♪

emily: the european union and the u.s. have reached a deal on data sharing. agreement replaces an earlier accord ruled illegal in the wake of edward snowden's revelations. the eu fear that personal data stored by u.s. companies might be exposed to spying. officials in the eu say that they can be sure that data is protected. coming up some of from a garage

in menlo park to the world's biggest company by market cap, we look at alphabet. biggest virtual reality funding round of all time. bloomberg news check us out on the radio. you can listen on the bloomberg radio at, bloomberg.com, and sirius xm. ♪

emily: i'm emily chang and this is "bloomberg west." it is 3:30 p.m. tuesday here in san francisco. 7:30 thursday morning in hong kong. where we're joined by sherry

with a look at the stories making headlines in air -- asia. good morning. >> good morning. kim china is set to complete the biggest acquisition ever by a chinese company. the deal said to be worth $43 billion and county announced later today. sources also saying kim china is considering delisting after the takeover. an independent panel has told an r bag maker, tecate to prioritize control to avoid further safety defects. it was told to form teams to investigate reports. the cause of the air bag crisis is sought, linked to 11 deaths and the recall of millions of vehicles. shares have plunged more than 50% over the past year. nissan and hyundai kia are

enjoying the best january auto sales in a decade. along with g.m., they posted gains while losses of toyota, honda and ford were smaller than feared. still, investors didn't like the uneven nature of the results with some up and some down. india's start-up scene could traket more overseas money. the reserve bank of india is giving foreign capital funds more options. they're allowing to invest in india start-up companies. the r.b.i. is also letting start-ups file reports over the internet and is easing the rules governing shares transactions. emily? emily: -- wednesday in hong kong, not thursday. but what is this going to do for the start-up scene in india? >> well, in the past decade,

most of india's best performing internet start-ups chose to establish themselves in places such as singapore, even though all of their busy -- business was in india. e-commerce businesses. so with this package, making life easier for investors, internet is expected to become more attractive and the government is helping them out too, promising tax breaks as ll as a $1.5 billion fund to increase boost. some are already raising questions about valuations. emily? emily: thanks so much. shery in hong kong. ♪ emily: a changing of the guard, at least when it comes to the most valuable companies in the world this week we saw facebook

surpass exxon mobile to become the fourth largest company by market cap in the world and apple cruised to become the number one spot. we look back to another age, 1993 for this week back in bloomberg and the rankings were much different. exxon was the world's biggest company followed by general electric. by the eve of the dot.com crash in 1999 exsons was replaced by microsoft but companies lining g. e. and microsoft still loomed large. what caused the change in the rankings? here to join us stock traders almanac editor and chief jeff hish. and paul, i'll start with you. as a formers equities analyst on wall street covering technology, are you concerned that so much on wall street today is

concentrated in the tech center? >> how can that be wrong? so yeah, it doesn't really, it's not particularly surprising. it's a sectsor that's seen more growth teaver last 30 years, 40 years now, dating back to the semiconductor and it's seeing increasing market captainlation -- captainlyization flowing in that direction and it is a bigger share and it shows up in the rankings you showed. emily: tech companies comprised in 2004 on september 1, comprised 32% of the s&p. today they're more like 17.4% of the s&p so not nearly as much as it accounted for back then but still, four of the five most valuable companies in the world. jeff, what do you make of that? jeff: i think this is the

beginning of the future here. back when i did the superboom book in 2011 our contention was that technology would be leading the future and here they are leading the stock market so i think it's very an propro and the beginning of the next superboom. we own apple and probabilities fund management but of the top four i would think that google and -- are much more entrenched. i think those are the kind of enabling paradigm technologies they mentioned in the superboom book that is going to drive the economic impact individuals on an irreplaceable, irreversible manner and change the world. i'm not sure these companies are those but it's the beginning of technology leadership for the boom of the future. emily: paul -- go ahead. paul: technologies insinuating

itself into non-technology parts of the economy. looking a is the tracking boom, driven oil prices down to insanely low let'sful in a large part it's the technology story. the technology leaking boo the broader economy, not just technology for technology's sake anymore. it's truly ubiquitous and that's the phenomenon we're seeing. paul: great point, jeff. emily: how long can alphabet stay in the lead. gene staying when the apple phone comes out. it's going to exchange and go back top al. >> i'm not sure. i do have an iphone and i use it but i find google much prosecutor -- more important in my life for researching and tracking things down. they have a modem immersed in many more technologies.

same thing were am. they're deep in database and information technology. i could live would excel. emily: the top companies then cisco, and others. facebook is only four years old as a public company. can facebook stay up there? >> facebook i'm less optimistic about than google. the way i look at it, you think of it in terms of market saturation in semiconductors, you had a rapidly emerging market that truly became competitive and same thing in smart phones, the phenomenon that apple is running up against. yet in google's advertising market, only about 8% have moved online and yet people spend 20%, 30%, 40% of their time staring

at mobile devices. google is in a dominant position and there's an awful lot of room yet to grow. emily: this is the question i'm asked often about, microsoft in particular. what did they do except announce a new c.e.o.? >> i don't think the c.e.o. is the -- i think bill gates laid the groundwork there for a company that's going immerse itself in the services and software and things that drive the technology economy. they'll probably have microsoft technology in tracking companies making thure that's done properly. i think facebook, like paul said could easily be dethroned much more than microsoft and everything that's entrenched in everything we use technologically in this world. emily: jeff hish, stock traders editor in chief and paul our bloomberg contributing editor.

thank you both. possibly the largest sea round in internet history. the super secret start-up has raised more than $793 million in a new round led by alley babba. this leaves the company at $4.5 billion. it will speed up the project of bringing their first project to market. magic leap is using -- working a head set that creates realties superimposed over real world views. google previously invested over happen -- half a billion dollars in the company in 2014. coming up, the video game disrupture that's shelling out serious cash for new games, even helping some pay their way through college. and up next, the official football of the nfl gets a

high-tech upgrade. the next wilson x connected football coming up.

emily: today marks the first tay in history that a polygraph was used in court. since the beginning of time, humans have tried to separate fact from fictions and catch liars in the act. before the 20th century, this usually meant torture and a lot of speculation but on this day n 1935 the first polygraphic was used to quaket criminal in

court. it's still under dispute as a valid form of technology but there's no doubt it's changed the lying game forever. wilson has provided the official nfl football for every super bowl in history and this year, the company is going high-tech, introducing the wilson x connected football. it includes a built-in sensor to measure speed, distance, and spiral efficiency. earlier i caught up with bob thoroughman, v.p. of wilson lab and asked him to give me a quick demo of how it works. >> the ball is asleep. we want to wake it up. this is a beta version of the football they're working on now. if i spin it up in the air you'll see it captures the motion that a football being thrown. it will capture the speed. the amount of revolutions. a quarterback gets a tight

spiral and butts a little spin on the ball. that's a little wobbly at 6%. not very good. every time you throw the football, it measures that. not only that, it opens game mechanics. now we can play a game in the backyard. you become the receiver and i can be the quarterback and we can march down the field without actually leaving the back yarlingd. >> could this be used to separate the best from the best? >> that's exactly how i see it. we want to measure arm strength, cognitive ability, the throwing quality and it's also a scouting tool. a tool that a quarterback can train to get better but also find that young quarterback in high school and find that next talent. >> who's the target audience? >> everybody that loves playing pass, everybody that loves getting out and throwing the football around. two kids in a backyard, two dads

at a tailgate. >> wilson has been making the football used in the super bowl since the beginning. >> all of them. every point ever scored has been a wilson football. emily: how is it different from the ball that's going to be used this year? >> it's essentially the same but in this case we've inserted a sensor into the football to measure how hard somebody threw it, how hard they threw it, how much of a spiral they put on it. this gives you more information. offensive and it's sinked into a mobile app, right? >> absolutely. the ball is connected seam li lesley to an app on the -- seam lesley to an app. emily: so what does tom brady think of this football? >> we're not sure. we hasn't tried it yet. emily: can it tell if it's been deflated. >> no, not yet. emily: you've been at wilson personally for 24 years.

what was different about this challenge? what challenges indict you -- did you run into? >> first of all we wanted to make sure nobody knows there's a sensor in here. second of all, we want it to be ready. it runs on a single charge, lasts for two years. it's always ready. turn it on, wake it up, throw the football and it's ready to go. emily: why did you guys decide to do this? were you compelled by companies like apple? >> we didn't want to do it just for the sake of making the product. we wanted to do something special for kids who wanted to play. we want kids off the couch, being more active, learning to three the football and having fun. it's healthy for us and then. emily: the connective basketball came out first. do you see opportunities for connective tennis balls or volleyballs or golf balls? >> absolutely.

we have a huge pipeline of things we started. it started with the basketball. every kid that's stood out in the driveway and done three, two, one, and shoots and scores. every kid that says hey, let's go deep. or every kid that says bases bottom nobody out. emily: does this change the game at all? >> it does change the game. we're talking about bringing next-generation analytics to the sport. the trajectory, how low the quarterback threw it, the timing of the route. emily: bob thurman, v.p. of innovation at wilson labs. sticking with sports, to the battle lines drawn in ink from athletes' tattoos, take two has carved out a name in the video

industry with astonishing graphics and stunning character models in its nba 2-k series that looks like real life players. their extraordinary attention to detail may cost them. turns out a tattoo company named solid observation -- oaks sketches earns the rights to tattoos on several athletes, including kobe bryant and lebron. the tattoo artists claimed they signed copyright agreements with the nba players. the company is suing for more than $1 million. coming up, the video game platform that's creating a new economy for developers and netting some teens six figures. that story next. ♪.

emily: it is time now for poll teching where politics and tech

merge. monday marks the start of primary season with the iowa caulk us and seems the caucuses gave twitter somewhat of a competitive advantage. while facebook showed more interest in trump and sanders. trump cruz and clinton as the winners. sales have plunged 30% from a ii r ago and sales of the w players continue to shrink. gaming original content is a challenge for everybody but a has -up called robucks created a new line. the company has paid out over $3.6 million so joining me roadblock c.e.o. david zoifpblgt

thank you votch. you've been doing this for a while but just now announcing a partnership with the xbox 1. >> thanks for having me on the show. emily: of course, a pleasure to have you. >> we're creating the future of entertainment at roadblocks and xbox is our latest thing we have announced. the engage in the is amazing. almost a million hours have already been played on xbox. emily: as i understand, there are teenagers creating games and some of them are pulling in six figures. >> absolutely. emily: how does this make sense for you? >> the box is a platform. over 2 million play every month. they range from hanging out with your friends at a pizza restaurant to surviving a tornado. over 300,000 developers every

month are creating these games. they literally make money from the games they're creating. offensive who are these people? amateur colders? experienced game developers? >> almost a star search or "american idol" for video games. take 20 million visitors every month, find the best to create games. the best of them rise to the top. this is college students, 12-year-olds, 18-year-olds. people paying for college, saving for college, people even making small businesses on top of the platform. emily: wow. what's the most a single creator has made? >> as the number of people playing grows the amount they're earning is growing. we have developers making over $250,000 a year. some are making studios that run on top of the roblox platform. emily: this is a challenge for the traditional game makers.

i was speaking with e.a.'s andrew wilson earlier this week. listen to what he had to say. >> they spend about 22 minutes in non-native apps but have an average of 26 apps. any company -- company is fighting for less than a minute of time. if you don't have a great network, if you aren't able to connect hundreds of millions of players in the context of your games experiences, times are going to get really tough. emily: companies like king digital spending a lot of money. what impact is this going to have on the broader market? >> it's what brings more people to our platform and it's the fastest growing number at roblox. we're getting literally over three million coming to the platform every month because they're doing it for free. you're hearing it from your friend. it's bringing them primarily virally to our platform.

offensive so ultimately who owns the game in the end? >> the.comer owns the game. it runs on our platform. we share in the virtual economy with them and they make money. emily: what happens if a big company wants to buy it? >> some day there may be vision that is pop off the platform and become stand-alone games. emily: how do you see the sort of hierarchy shifting within the gaming industry, whether it's mobile or social -- >> so we're -- what's cool about roblox, is everything you're seeing here is running on all platforms. play it on your phone, a tab let, a computer and now on xbox. user creative games need to run everywhere, we think so you need to be able to play them with your friends wherever you are. on your phone against your friend on xbox. mobile gaming and facebook

gaming is pretty mature. virtual reality is what everything is talking about. roblox is the ultimate platform for that. you're already with your friends. i think that's where a lot of the action will be. offensive to be a kid today. when i was young it was just tetris and super mario brothers. thank you so much for joining us. >> thank you. emily: that does it for this edition of "bloomberg west." tomorrow on the show, a full breakdown of go pro earnings as the volatile stock continues to slide, now down 80% in the last year. that's all today from san francisco. ♪

>> from our studios in new york city, this is contract charlie rose" charlie: senator bernie sanders is here. he is, as you know, a candidate for the democratic candidate for president. he refers to himself as a democratic socialist. former secretary of state hillary clinton currently leads him in the polls but sanders has continued to draw huge crowds. he and clinton spoke at the jefferson-jackson dinner on sunday in iowa. bernie: today some are trying to rewrite hi