♪ mark: i'm mark crumpton and you are watching "bloomberg west." italy joined the rest of europe and extended legal protections to gay couples. the countries lower chamber of deputies gave final approval to legislation that italy's senate passed in february. the stopped short of authorizing gay marriage. islamic state is claiming responsibility for a series of at least on today in baghdad. the blasts left 93 people dead and over 160 wounded. the targets included an outdoor market and police station. house speaker paul ryan scheduled to meet tomorrow with donald trump. ryan said today that republicans

have some work to do. >> we go into the fall at half strength. this election is too important to go into an election at half strength. we need a real unification of our party. mark: last week, the speaker said he was not prepared to endorse trump's candidacy. arson is to blame for a fire at a fertilizer plant in 2013, causing ammonia nitrate to ignite. the blast destroyed more than 500 homes. global news 24 hours a day, powered by our 2400 journalists in more than 150 news bureaus around the world. i'm mark crumpton. ♪

emily: i'm emily chang and this is a special edition of bloomberg west from the storied m.i.t. media lab in cambridge, massachusetts. it's the birthplace of so many innovations like touchscreen devices and gps. we have spent the last few days speaking to the entrepreneurs and investors driving the startup scene and heard from the cities established layers in robotics and i/o tech. now we spend the next hour going behind the scenes to where the ideas are conceived. the media lab specializes in anti-disciplinary thinking, looking for misfits and rebels, working on ground breaking products no one else would take a risk on. other ideas that got their start here, the precursor to google street view and one narrow by all it is here just one mark zuckerberg's breakthrough price. the media lab is pioneering research in biology, agriculture, urban living and

more. m.i.t. sits at the heart of some of the most cutting edge in robotics with companies like boston dynamics and irobot. this lab has strong corporate relationships with ties to apple, google, samsung and boeing. the japanese carmaker putting $25 million into a center for research on self driving cars. here to help us chart this journey and take us to the front lines, the director of the computer science and artificial intelligence lab. thank you for joining us. how did boston become the place where robotics would explode? john: i think there's something special in the air at m.i.t.. we work across boundaries and work together to create systems to combine the best of

multi-disciplines. a robot is one of the best embodiments of that. emily: you have said robots will pervade our lives. how so mark in five years, how will my life be different? daniella: it is true my dream is for everyone to use a robotlike everyone uses a smart phone today. to get to this point, we are making huge strides in making robots more intelligent, more able to figure things out. easier and faster to old new robots and making better ways for humans and robots to interact with each other. emily: paint the picture for me. how will my life be different? john: we see advances in the robots ability to perceive the world and manipulate objects. a big one is self driving cars. the level of investment is

unprecedented with apple, google are, tesla making investments. in five years, having a car that is much more highly automated will impact your life. emily: toyota is investing a billion dollars to build a self driving car by 2020. is that ambitious? john: yes. it's like the new space race between high tech companies, a lot of them in the valley and traditional companies. there is so much space to revolutionize transportation. daniella: right now, it is possible to have self driving vehicles at low speeds and low complexity environments. the question is how do we scale? how do we go to more complex environments? a university campus, retirement community, a community that does not have too much traffic.

you can already implement cars that will safely navigate in these spaces. in the future, will have much more capabilities from these cars. my personal desire is to have the car become my friend. to understand what do i like when i'm driving, to understand that i'm having a difficult day because my voice sounds stressed. to understand i'm out of milk and it could route me to a grocery store. emily: what does this mean for our social and emotional lives? does this make us less social? daniella: absolutely not. it gives us the ability to work with a machine. john: one of the true frontiers is human and robot interaction. there has been a lot of work on adding that social component, so

i think robots can become part of our lives and it won't diminish the social aspect. emily: you brought an entirely 3-d printed robot that walks. tell me about that. daniella: this is a way of showing some of our technology for speeding up the fabrication of robots. all you have to do is add a motor and a battery and the robot has embedded in it the entire actuation system. right now it takes a lot of skill and a lot of maneuvers and operations in order to assemble the robot, you need to be a specialist. but with this technology, you can design a cab model or select the parts, push a button and you have your robot.

emily: what do you say to the people who fear robots will take our jobs? john: i think the issue is important and has been recurring through history. it has just been accelerating lately. we have had extensive discussions to try to get a handle on this and i can't say i know the answer that i have to be optimistic that robots can take over the dull and dangerous jobs and give people better things to do with their lives. if we can improve the quality of work people do, i think technology could raise everyone up and lead to full employment. emily: we have talked a lot about google's robots on the show. a lot of people don't know why or what they're working on, but boston dynamics, that makes these humanoid robots that can walk through snow or walk-through war zones, now they are selling that company.

it was out of fear attention to that the public was scared. what do you think is happening there? daniella: i don't know. google did not tell me why. boston dynamics is an extraordinary company and they will continue to push the boundaries in robotics. john: i think robots can help people. we have a class in assistive technology to help people who are disabled or with learning disabilities. in general, technology can help people in that is one of the things i can believe. robots are just one example. daniella: i fully share john's view but robots are better than us at some tasks. they can crunch numbers, they can lift heavier objects, it is wonderful to think about the

symbiosis between man and machine where robots do what they are best at and humans do what they are best at and together, they are much more powerful as a symbiosis. emily: it is asked naming stuff both of you are working on. thank you both so much for joining us. continuing with our special program, we are highlighting research groups and we want to show you the lab where some of the most advanced bionic's have been designed. this is a man who has engineered some of the biggest recent breakthroughs in the technology of artificial limbs. after a mountaineering accident,

he went to a double amputation and dedicated his life's work to people the needed prosthetics. he believes the answer is in biotics. >> i believe in structures from synthetic or biological material that instantly connect or implanted inside the body that at least normalize human physiological function and from time to time extend human capability. emily: these limbs can do things no other commercially available prosthetics can. >> the foot ankle i am wearing is the first bionic ankle powered that emulates lost muscle function. all other commercial foot ankle devices are human howard, like a bicycle where only your energy causes the bicycle to move. emily: this technology has been spun out into a startup called bionic's. the company has fitted 1300 patients with these limbs. 50% of them are wounded

veterans. a new partnership with the world largest prosthetic maker means patients across western europe can access this technology. the lab is developing exoskeletons, equipment that could augment physical performance beyond what nature intended, enhancing performance for athletes and children -- and soldiers, making extreme sport even more thrilling. >> i think in the near future, you will walk down the street in new york or boston and it will be common to see people wearing bionics. bionics is about self-improvement and a journey of what humanity can be when humanity blends with the technology and good design. emily: that was an m.i.t. media professor in the work he is leading. to stocks we're watching -- electronic arts surging in wednesday trading after

reporting earnings tuesday afternoon. the company's digital revenue suggesting it's well-positioned to manage the shift to online gaming. disney shares fell the most, concern about the outlook for media. profits in the abc unit declined and disney shut down its infinity via games operation. m.i.t. alums have given birth to 795 inventions, 314 pass it -- patents and 30,000 companies around the world. our exclusive with m.i.t. president, next. then we talk to the director of the famed media lab and the program responsible for some of the biggest innovations from wearables to touchscreens. ♪

♪ emily: this is a special edition of "bloomberg west" live from m.i.t.'s media lab. we just heard from two of the leading minds in robotics research, but let's turn to the president for a big teacher look at entrepreneurship and innovation. we worked with m.i.t. to pull some numbers and found university teaches 63 courses on october ship, 172 members of its faculty members are serial entrepreneurs, meaning they have found in multiple startups, and over 30,000 active companies

have been launched by m.i.t. alums and rating $1.9 trillion in annual revenue. joining us now is m.i.t.'s president, rafael reif. how do you see m.i.t.'s role in the startup community in boston and the world? rafael: m.i.t. is a very unique place. students with a great deal of talent come here not just because they want to get a degree but they want to do something important to make the world better. they come here to learn and try to work on projects that address the most important challenges the world races. emily: you have a theory that we as a nation leave a lot of innovation on the table like catch of a bottle. what do you mean by that?

rafael: if you come to m.i.t., you see a tremendous amount of innovation. you wanted to go out into society and help address the world's biggest challenges. right now, u.s. is the most innovative country in the world and the system works very well. some are bought by big companies, but that is the way innovation moves through the market and society. the risk capital is only going to ideas that reach success quickly or failed very quickly. the most important challenges the world faces, whether climate change, clean energy, fresh water, food, hiv vaccines, you name it, all of those important challenges take long development times. the risk capital is very limited. in that way, we are leaving all the innovation in the bottle. emily: we are based in san

francisco and we talk about stanford being behind companies like google yahoo! and cisco. are the entrepreneurs at m.i.t. at a disadvantage because they are not at the heart of the venture capital industry? rafael: i would not say it's a disadvantage. many entrepreneurs here end up on the west coast. you mentioned 30,000 plus companies by m.i.t. alumni. 30% of them are massachusetts. 20% are in california. they can make their company successful. i would not say it's a disadvantage. the innovation we have in this country is huge, but not all of it is reaching the marketplace. i'm just trying to fine tune the system we have. we do need google, yahoo! and facebook.

we also need many other kinds of companies. emily: how do you find tune that process when a lot of the opportunities you are working on that are potentially revolutionary but might take 5, 10 or 20 years before they are real? rafael: the most important thing we really need is patient capital. there are modern day investors that are more on the flavor of philanthropic investors. they already made their money doing things the way americans do. they want to do good in the world hoping to make a difference. the most important thing we need is patient capital but we also need the proper amount of space.

emily: we talk a lot about the future of education. i wonder what your view is of the future of higher education? we spoke with saul con from the con academy and he believes the more students can learn online, the more they can free themselves to do things off-line. what's the future of higher education? rafael: the way i see it, there's no question in my mind that the mit's come a stanford's, harvard's, that's the best education there is. but it is also the most expensive. we will always need these places, but a provide the best quality. for many, we cannot accommodate. many of those would do very well here. we need to find a way to get a quality education and the online and digital tools help.

we are trying to figure out how to combine those two. we have a pilot program where you cannot apply to m.i.t. but take online courses and if you do well, we invite you to come to m.i.t. emily: so interesting to have you on the show. thank you for having us here at the university. rafael: thank you so much. emily: coming up, we are looking at the future of food, pushing agriculture into the digital frontier. ♪

♪ emily: this is a special edition of "bloomberg west" live from cambridge, massachusetts. what does the future of food look like? here, a group of producers are

looking at the future of farms. our current system of shipping fresh ingredients across the globe. it targets -- they are collaborating to gain insight into its grocery business. take a look at what the open agriculture initiative has in store. >> i am a climate designer. what if we could produce climate anywhere in the world that was very beneficial? emily: one day, in the not too distant future, all of our food will be grown in arms that look like this. these are techniques for growing plants without using soil, in a totally controlled environment. m.i.t.'s open agriculture initiative says this is three to five times faster and uses less water than traditional farming. plus it comes with health benefits. >> a plant, when it gets harvested to win against in your mouth is the grading.

we can move it closer to cities so that you might do something like harvest and deed within 20 minutes. emily: in these so-called digital farms, sensors take readings every eight seconds, checking a mineral contents to temperatures. even the light exposure can be regulated to make the plants look, taste and grow the way you want them, essentially creating a recipe that can be saved, shared, and reusable. >> can we be decentralized? we know that's going to continue, so do we have a strategic, new type of agriculture for that emily: in this decentralized future, what happens to the supermarket? target is collaborating on a second facility. >> if you look at who is supporting my work, you see big retailers, food companies are

the backbone. that's because they know the consumer has changed. the consumer wants trust and the consumer wants transparency. ♪

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simply by using your voice. the billboard music awards, live sunday may 22nd, 8/5 pacific, only on abc. >> the top stories this hour. usually stocks are headed for their first decline in three days. the losers ing tokyo after forecasting a 35% traffic -- profit drop. household profits are down 21% this year. is in talks motors with nissan. both companies say they will discuss the matters at board meetings later today. earlier, sorcerers told us nissan was seeking a one third which had asubishi scandal over falsified fuel.

home and away has reached its whitest -- whitest. the entree one against a declining dollar. it allows speculators for from selling in shanghai. something that where do leaders stamp out. those are the headlines from bloomberg news. powered by over 2400 euros. let's get the latest in the markets. as you mentioned, we are looking at the first loss since monday. is just coming back online and look at the earlier losses. we had seen this switchover with the shanghai. the breakdown by a third of 1%. it has been down by more than 1%

which has seen chinese stocks had to two months rose. southeast asia is a little bit mix. have very solid gains on the market. pricee the higher crude we are seeing it down for tenths of 1%. costly is looking flat. having a look at some stocks we are watching in the region. we have been keeping a close eye on to caught up. it is searching by a record after in annual profit. bridgestone have very much disappointed the market. mitsubishi is waiting for that to to come online. we will just be seeing it hit the limit when things care off in japan. casio computer is the worst

performer down by 12%. it is a little weak in their against the dollar. that is the picture on asian markets. ♪ emily: this is a special edition of "bloomberg west" where we are focused on the innovation pipeline that comes from the 100 universities that called boston home. alumni from m.i.t. have lunch 30,000 active companies, employing 4.6 million people. a content delivery company responsible for running the internet or making sure your netflix shows stream smoothly. the company estimates at any given time it's delivering 25% of the world where traffic.

my guest scales it to a $9 billion market cap company that counts apple among its biggest customers. welcome back to "bloomberg west." you started this company in the mid-90's when the internet was a shadow of what it would come. what was the original idea? guest: the original idea was to help the internet scale. we had this segment before on the computer science and ai lab. before there was real internet traffic, he was worried about it and how would you distribute the videos of scale and run a commerce site at scale, especially during holiday shopping? emily: how you did this in a lab with math and algorithms.

how did you go from idea to legitimate business? guest: we never had that intention. m.i.t. has a business plan competition called the 50 k. now it is the 100 k. we entered it for fun and learn how to write a business plan. through the competition, we met venture capitalists, entrepreneurs, and learned about creating a business and ultimately, that is what helped us start the business. emily: we talked about mark zuckerberg starting facebook in cambridge and moving to silicon valley. why did you stay in boston? guest: it's a great place to start a company. people will look at me like i'm a martian and why you stay in austin or cambridge? it's a fantastic place. our headquarters is right next to m.i.t.

it's a great talent pool and we do a lot of recruiting. emily: does it give you an edge being outside the silicon valley freight? guest: i think in a way, yes it does give us an edge, having our headquarters here, a great center of technology and education. emily: google, facebook, and microsoft all have offices here. you also teach at m.i.t. why do you do that? guest: every other fall, i teach a course on mathematics for computer science. normally, you take a required course in math, it's dry and not so interesting, but math is incredibly important. it's all math. it's a great chance to bring the excitement of technology and innovation into the classroom. emily: what is your advice to kids in a lab today with an idea?

there are so many ideas in the m.i.t. media lab. it was like a kid in a candy store. how do you scale the ideas? guest: there are people here who will help you do that. there are tech stars and venture cafe and all sorts of incubators and all kinds of startups. it will help you get going. i knew nothing about. i did not know what vc was. but there are people to help you get started. emily: if congestion was the big problem in the 90's, what's the big challenge with the future of the internet? guest: i think congestion is going to be a bigger problem. you already see it when you try to watch online movies and don't get the high quality. it's because you are not getting enough bits per second and that's a problem we created the company to solve. cyber security -- that's a huge

issue with all the attacks and thefts of confidential information. i had my tax history stolen from the irs. filing a return, trying to get money on behalf of a criminal organization. it is a big problem. how do you make the web the fast? you have your mobile device and click and it's not instant. we expect it to be. emily: you have content providers like apple and netflix moving their business in-house. on the other, you have video growing faster than ever. how is this impacting your business? guest: our video business is growing very rapidly. our security business is growing close to 50% year over year. business is very strong and we have a couple of customers trying to do more. in terms of the traffic, it is growing at a tremendous rate. emily: what is your big challenge going forward?

guest: scaling and solving those grand challenge problems. we want to enable a world where 2 billion people can go home in prime time and watch a high quality video online. we want to enable a world where you can do business online and not have important information stolen. those are hard problems. emily: started right here on the m.i.t. campus. thank you for joining us. up next, the m.i.t. researcher using data visualization and sharing economies to help solve one of europe's greatest crises right now, finding homes for the massive waves of refugees on its doorsteps. and tune in for the highlights of our trip to boston. the best of "bloomberg west" this week on bloomberg television. ♪

♪ emily: this is a special edition of "bloomberg west" live from the media lab and cambridge massachusetts at m.i.t. now trying to settle and integrate refugees from the middle east and north africa, raising questions of public housing. the mayor of hamburg is

collaborating with the m.i.t. media lab to work on these issues. here's a look at what the group is working on. >> if the mayors want to increase entrepreneurship, have more creative, innovative places, they have to focus on diversity. the goal is to allow people who are currently priced out of the market to live and work in the creative heart of cities. emily: achieving that goal means radically rethinking our living spaces in the way we move around our cities. homburg, germany has enlisted changing places research group to settle and integrate refugees arriving in europe from the middle east. the vision is for homes to be small and spaces to be transformable so more people can live closer together. >> we think it should be effortless and almost magical. the face should just -- the space should just go through a

dance so your bed goes away and it's a living space. some of it can happen automatically. take a shower and the apartment is transformed when you come out and is prepared for your day. i think the technology to make that work is at hand. it's just a matter of putting it all together. emily: take a look at these on-demand shared vehicles with self driving capabilities. they would move on like lanes rather than roads and have mechanisms for compact parking. >> it makes no sense to rapid human and 4000 pounds of high strength steel to move them a short distance at low speed with one passenger. our persuasive electric vehicle is designed like a driverless, bike-like uber system. emily: they are testing the vehicles the summer in pilot projects in andorra and taiwan.

>> if we are successful, we will figure out a way to get it out into the world. emily: professor kent larson and his work here at the m.i.t. media lab. a story we are following -- one of you on concept is one step closer to reality. hyperloop, the ultrafast transportation he wrote about had its first open air test. a metal sled was powered from zero to 100 miles and hour in just 1.1 seconds, 2.4 g's of force. the company plans to use the innovation to transport freight and passengers in low pressure tubes that 700 miles an hour. on tuesday, one of the cofounders says they want a full demo by the end of the year. >> i think the first appointments will be abroad. mostly because of the regulatory and governmental side of things.

but we hope to bring hyperloop to the u.s. emily: the company also says it raised a series b round of $80 million. now to a story we are following -- uber hitting the brakes on its carpooling service in sweden after the company has been struggling with regulations. they had encountered some resistance and sweden needs a modern and regulatory framework. uber will continue to offer services like uber x uber loft. coming up, we have been diving into the research coming out of the m.i.t. media lab. we will ask what he sees as the next big rake threw in this special edition of "bloomberg west" live from cambridge, massachusetts. ♪

♪ emily: this is a special edition of "bloomberg west" from the nit media lab in cambridge, massachusetts. a spacex capsule has returned to earth with scientific research samples after a one-year mission. it left the international space station early on wednesday morning bound for a splashdown in the pacific. it had been there dropping off supplies and an experiment all room that will pop open in two weeks.

nearly 4000 pounds of items were packed into the capsule, including blood samples from scott kelly's one-year mission as part of an experience -- experiment to understand the impact space has on the human body. to round out our three days of special programming, we want to leave you with one of the thoughts of joi ito, director of the m.i.t. media lab. he is a two-time college dropout and three-time entrepreneur. he was tapped to become director of the media lab in 2011 and believes as the digital resolution plays out -- revolution plays out, a biological revolution is next. here to round out the hour is m.i.t. lab director, joi ito. thank you for having us here. so the biological revolution is next? what do you mean by that? joi: 30 years ago, when the media lab was created, computers were about big companies working

on very special projects that most companies did not have to think about. eventually, with the internet and other things, you couldn't not have an internet strategy. similarly, medicine and health has been about small molecules, hospitals and big pharma companies. if you look at all the tools involved and the fact that health care is 24 hours a day from when you born to when you die, it's becoming this convergence, a lot like the internet has done for information. emily: biotech research and information is harder to fund. will it scale? joi: it will scale differently. it is harder. there are more safety concerns then launching an app. it's a huge market that requires real science and one of the reasons i decided to come to

m.i.t. is cambridge is the center of biotech. just like the computer companies draged all of these other companies and people into silicon valley, what we see is this emergence of a new field. this ecosystem has to be built in a different way than we did for computers. emily: you think the bio revolution is next and boston will surpass silicon valley? is boston the next silicon valley? joi: shenzhen is the hardware of silicon valley now. and i think we will be the bio of silicon valley. more and more software and artificial intelligence and robotics is all required for bio and bio is not easy to do online.

it's about walking over and looking at samples. it is very physical, so you'd need to be m.i.t. and harvard. emily: you are working with a company called pure tech? joi: yes. i had to go to capital markets and got back just a few hours ago. they are setting some examples. a lot of companies require basic science and need to do fda trials and a lot of times, these technologies are not ready to be companies yet. pure tech is a new model for connecting academic research for companies. this experimenting and testing with new ways to translate academic research into companies is really important. emily: one of the things you have spoken out about is bitcoin. what do you think the future of bitcoin is? joi: one of my first companies was an internet service provider in japan and i worked on a lot of early internet protocol.

the thing about the internet is we've had a lot of time to work out the technology before people started pouring money in. the problem is with bitcoin we have a billion dollars of venture money before we figured out how to do the governance, what the protocols are. the upside of bitcoin is it will be to banking, law, contracts and accounting with the internet was to media and advertising. but the tricky part is we are ahead of ourselves and a lot of these investments we are making to make the apps are happening before we figure out the core. web guys, richard clarke is here, we do a lot of open protocols here and silicon valley gets the monopoly and makes them into money. one of the things we do at the media lab is we were paying for a lot of core developers and we are probably the largest

non-financially interested group working on bitcoin and financial cryptography. emily: i know this is a difficult question to answer, but what's the single most transformative idea you are working on right now at the media lab? you can only pick one. joi: let's just say importance. the reason i've been going to silicon valley every couple of weeks now is i think the artificial intelligence -- the single of terry and in silicon valley believe computers will just get so smart that you can ignore policy and law. the philosophers and lawyers are working without understanding the technology. bringing human beings and society together with ai is important. we don't think it is about terminator.

the future is about machines and human beings working together, whether we are talking about bionics to individual interfaces to networks inside of society where we have computers and machines working together. how those things work together is important and the media lab is about the relationship between machines and humans. we are calling it extended intelligence instead of artificial intelligence. emily: fascinating stuff you are working on. thank you for joining us. that does it for this special edition of "bloomberg west" live from m.i.t. where we have focused on the world-class research right here in cambridge that goes on to become some of the most important technology stories we cover on this show. if you missed any of our special coverage, you can find it on bloomberg.com and this weekend on "the best of bloomberg west." that's it from m.i.t. ♪

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♪ ♪ the saudi exchange is said to raise 60% growth. calls for the good limits on what they can earn in transactions. is building in turkey with increasingly bearish signs of a $25 billion stock selloff. space ass troubled it's drew doughty partners