>> i am cory johnson in for emily chang it, and this is the best of "bloomberg west." all of the top interviews from this week in technology. we will dig into the idaho buzz. plus, tesla feeling the heat. the national highway traffic and ministration is investing the second terrifying crash involving the tesla autopilot. we will discuss. we take a deep dive in tech investing in china.

the latest trend and what is next in mna. two chinese tech investors join us were in in-depth conversation. tech and media leaders descended on sun valley this week to attend the allen and company conference. mark zuckerberg and tim cook were two of the big names on the list in this hush, closed-door event, but we managed to get a few of the people on the record. we caught up with jeff bezos when he was there and david garrow. david started asking about tesla. >> i am a tesla owner and i use the autopilot all the time. i use it differently because to me i'm a it is a way to relieve my stress in bumper-to-bumper traffic. i would surmise the chances of me into a truck at high speed

are probably small, and even that theory, you better keep your eyes on the road. going forward, personally saddened that the autopilot feature was involved in an accident. the google track record, which has driven a huge number of miles now, speaks for itself. >> take us back to that philosophical debate. you have semi-a time is driving and fully autonomous driving. >> we are try to get to the point when we can get rid of all traffic. to us, having a personal loop is tricky. we can push a button at some point and get somewhere accident free. a metric between google interventions, and we got this

to be 300 or 500,000 miles. >> you said this year was going to be a big year for ai, but looking at vr, which is more ready? >> i think both are exciting technologies. i love vr in the classroom and to be able to go somewhere as opposed to two pages in the book. ai is very different. artificial intelligence will turn us into better human beings for the tasks we do. for me, ai is for productivity enhancing the same way farming equipment makes farmers more efficient. we are in entertainment industry that can be used to get rid of the free time on our hands. >> there is conversation about

content, the commoditization of conduct, who will be producing content. >> i find it fascinating how content has involved. when i was a child, only a few frivolous people were allowed. now, we are living in an age when everyone can do content. we have an enormous amount of content. the race to the bottom is becoming cheaper and cheaper to the consumer. education is no exception here. we make it free of charge so everyone can consume it at their leisure.

we paid to do it to administer the content. we charge for certification and services. you want to have feedback on your project, you come to us and pay someone to hundred dollars a month -- $200 a month. i think the future of content will be interesting because we will have a race to the bottom and it will get cheaper and cheaper. cory: that was sebastian. we also caught up with tim armstrong. check it out. >> we are heavy investors and content for the last five or six years, when it was not popular. content is the great differentiator. it helps people get modified. i am guessing what happens is you will see a lot of silicon valley players in the first inning of content, and content and creativity will end up being the feature differentiator for all these platforms. i think we are at the early stages of the content era when it comes to mobile and online, and i am excited about it. it is the right place for the industry to be and the right place for us to be, and you will see more and more deals over the next three to five years. >> we have these seismic shifts in television to net-based

consumption of tv material. how do you focus on monetizing that? how do you think that transition will go? tim: there are a few things going on right now. you are starting to see people like the nfl bring their content online which will drive more eyeballs and more advertising will be interested. the second thing is when you look at things i'd virtual reality and augmented reality, we just bought a company called riot. when you see how that content is going to be brought to life, consumers are going to love it, but advertisers are going to love it. the ad business is a $600 billion business. they will switch from video tv to more online things and mobile platforms over time.

you are at an early stage of another seismic shift besides the internet that will happen around video, and it will be even better for consumers and advertisers over time. it might be more expensive for advertisers, but it will be better off for everybody. >> you have facebook and google, such big giants in that space. you have been looking at ways to get around that to get a foothold there. what are they? tim: google and facebook are juggernauts at this point. they have done an excellent job operating and executing. it is great to be eight in an industry to have competitors like that. it makes our game better overall. from our standpoint, we have been really focused on being an open platform. part of the reason we did the verizon deal is to make sure we have differentiated data. we have differentiated content and 4000 publisher relationships tubing to the table. our standpoint is copying facebook and google will not get you there. we want to be a company building brands. cory: that was tim armstrong with david. coming up, the dark side of live video. we will delve into the difficult questions of live streaming.

it has been five years in the making the spacecraft successfully entering jupiter's orbit this week. this is bloomberg. ♪

cory: the new world of live video is in sharp focus after a minnesota woman streamed a video of a person being shot after being pulled over for a busted taillight. the content was going viral across the internet on twitter, youtube, snapped at. -- and snap chat. the incident underscores how unpredictable live content can be and also raises difficult questions about how videos should be monitored and curated. >> when you have something as emotionally charged and politically charged as this, it

is something that can get in a lot of trouble for taking down. in this case, they say it was a technical glitch. who knows if that is the whole story, but that is the statement right now. once they noticed the video was down, and probably because there was a lot of fervor about it being down, they restored with a warning that it was graphic content. cory: in terms of popularity of this thing, and popularity is a horrible word to use, this got a lot of attention quickly on facebook and exactly the way facebook wants to. what is the behind-the-scenes business about making a video everyone wants to see available to be seen and the likelihood of a technical glitch or so on? >> i think there is a number of elements in there. from a business perspective, i don't think any of the platforms will look at these kind of videos as something they want to sell advertising against him of what i do think they reinforce

the nature of these platforms as really powerful channels for understanding news and current affairs, which obviously does have a business impact. i think platforms like facebook and twitter are really proud of the impact they have had in political movements and political impact. i think the success of these videos underscores the kind of impact these platforms can have in distributing these kinds of stories. cory: i think that that is kind of the message here. i think the internet and social media have not lived up to the promise of democratization of messages, but we sure see it right here. larry wilmore last night on comedy central said thank god for cell phones, and i cannot agree more. >> right. we count on law enforcement to keep communities saved and to hold up the values of equal justice and due process. black and brown folks have been saying for decades that is not the treatment we receive, but we

were disbelieved and discounted. this technology is a game changer in multiple ways. it means movements and individuals are documented the kind of treatment that too often communities of color are receiving. they are then able to share it, sometimes live streamed, sometimes after the fact with millions of people, and then they are able to organize. you see people working together in different parts of the country and different parts of the world who never could have connected before this technology was available, and now they are able to do so. >> that is exactly the situation we are seeing here. this has been a problem in the black community for decades, and people are saying that just now, now that these videos can be seen and distributed is it getting this kind of shock and this commission from the rest of the world and community, so it can be a very powerful medium. we saw this on twitter for the arab spring in 2011.

we saw this in other instances on that side, but facebook has rarely been -- site, but facebook has rarely been the genesis of these videos, and there is a sign it will be a political force as well. cory: what are the commercial applications here in terms of facebook making money off of this? twitter and snap chat -- the first ever for snap chat. it is intriguing for a business standpoint, too. >> i don't think they will be looking to make money from these videos specifically, but they are proud of the ability to be platforms to communicate these messages, and when you look at facebook investing in facebook live, when you look at twitter infesting heavily in --

investing heavily in periscope, these will be the platforms of the future for distributing live video content. whether it is political news or celebrities talking about stuff, and i think it is very clear there are huge business opportunities for becoming this major media platform online video. i think they are going after that, in this is one of the impact of that journey. cory: i don't know if this is a moral question. should there be ads on something like this? should facebook or twitter or snapshot or something like that this kind of content in a separate ad-free place and leave commercialism out of it? >> i think so, but this is news, and it is social content, and it should be triggered as other news and social content is. these are social platforms, and everyone understands that. i think it would be insensitive and somewhat offensive to have intermittent ads and commercials in between some of these terrible images that we are seeing, but i think what we are seeing is that there is deeper

saturation among communities of color of some of these platforms than among others in the general population. so that means that different audiences are being reached. i think it is relevant to what other ads are run on these platforms, hopefully not in the midst of these kind of images, as relevant to who is using the platform and how. cory: it is also interesting the cops in louisiana had body cameras that for some mysterious reason, both cops's did not work at the time of this shooting. >> we see that a lot. we don't know if there was a genuine technical malfunction or whether there was some out reasons, but we certainly see malfeasance turning off of cameras and body cameras and the like of some officers in some places so the fact that every day individuals, citizen journalists also carrying this technology is also crucial. cory: still ahead, we will hear

from one of uk's biggest central capital firms on venture investing the post brags it world. after two terrifying tesla crashes, the autopilot technology is under investigation. what this means for tesla and the dream of self driving cars. this is a bloomberg. ♪

cory: now to tesla. the company's autopilot system under scrutiny this week. investigating reports of a second driver injured while using tesla's autopilot. model x rolling over when using autopilot in pennsylvania. this comes days after an open investigation into a fatal may crash in florida. still raising questions about

whether tesla has done enough testing of its autopilot technology where the primers -- or the drivers are understanding its limits. ted niedermayer joined us to discuss. >> tesla made it seem like this was autonomous technology, and i think what we are finding out is drivers believed it was when in fact, it was something quite a bit less than full autonomous driving technology. cory: are we right to suspect the drivers not doing the right thing here? liam: i think it is a bit of both. some interpreted it as offering way more than it does right now. tesla's own communication can be somewhat confusing. i think it was last year that elon was talking about cars being fully autonomous 15 to 20 years from now, but tesla getting there much quicker.

there is a race among these companies to establish leadership, and sometimes people think that means they are already there. cory: i wonder, this guy and florida, joshua brown, he is well-known known in the tesla community. he uploaded several videos onto youtube showing what he can do with the car. tesla owners, they say the autopilot feature would work under certain circumstances. we are looking at video shot by joshua brown. in this video, he appears to demonstrate how the autopilot helped avoid a collision with a truck. this video attracted comments from other tesla users both critically and couple metairie. they twittered out a link to this video saying the owner of

the autopilot was elated to get this elon musk mention of the video, and he went on to shoot at least one more video and posted it on youtube. this suggests the relationship between tesla -- they are certainly not wanting them to drive dangerously, but this raises the question to what the company's relationship is with users and encouraging them to push the limit. >> i think the company as a whole has -- of pushing the limit. if you listen to the way elon talks, he sets of possible targets -- sets impossible targets. i think in this particular instance, tesla has been very quick to point out but it gives a lot of warnings about the system when it switches on that it never tells drivers to simply push it on and away they go. but obviously, when you are doing something which is called public beta testing of a piece of equipment, the danger is very

real. cory: there is a notion that the cars get better and better with software updates. we showed sales, and we got company released numbers that missed their own estimates along with the estimates of wall street, but they released them on a sunday of a three-day weekend in the middle of the summer. you could not find a time to bury them more and the company lowering its guidance going forward how many cars they can make. two quarters and a row now with car declining in sales. i wonder if there is a relationship between the delivery of the tesla to the

promise of limitless technological advancement. >> yes, well i think i have certainly noticed a shift in the online conversation around tesla going back nine months or more. what we have seen in the last month or two has really accelerated. i think what the issue here is tesla's keen asset, which is not really technology, it is elon musk specifically, his credibility. you have a decade of promises from elon musk and tesla, many of which have not been fulfilled, and then you have this does connect between perceptions of autopilot skippable of and the reality of it. cory: liam and ed talking about tesla. now we take you to space. a five-year 1.7 billion mile journey, juno is entering jupiter's orbit. it is the first spacecraft to

make it successfully there. we spoke with the project manager, kenny stearns. >> jupiter is important to science because it is so massive, and it was one of the first or the first planet that was formed in our solar system. scientists are interested in what may jupiter, so this will give a good indication and unravel a lot of the mysteries about how this solar system formed, and maybe even where we came from. cory: what are the biggest obstacles, biggest problems this could face? kenny: other than the sheer distance away, some of the biggest obstacles have to do

with massive amounts of radiation that surrounds the planet itself. radiation is very damaging to electronic as well as people for that matter, but it is so much higher intensity at jupiter. our spacecraft will be going in and out of these radiation belts at different levels and absorbing this radiation, which will eventually be its demise when the mission is over. cory: remind me when this mission started or when the spaceship took off. kenny: we launched it august 6, 2011. cory: are there technological advances that happened in the ensuing five years that you wish you could have taken advantage of? kenny: we have not run across any of those things yet. every time we make a new build for a spacecraft, there is new technology and better ways of doing things. low-power electronics is key. one of the key things for jupiter is to be able to run on very small amount of power. the solar rays while massive only generate 500 watts on

average at jupiter. cory: you talk about radiation issues. the fields around jupiter are unusual among the planets. kenny: yes, but it is the largest magnetic field of any planet in the solar system, which is a subject of interest to some of the science that is going on while we are there. we will be studying the magnetic field and its origin and how it gets there, and there is a place for high energetic particles like electrons and protons that are running sp is much higher than what they normally do or closer to the speed of light. cory: what new questions will you be prepared to look at after we get some answers? kenny: of course, we are going to have to get the data first before we see what the next questions are going to be. certainly after we understand more about the formation of jupiter, we will start thinking more about, what does that mean

for some of the other planets? what does that mean for planets in the solar system that are beyond our own start? cory: lockheed martin's juneau project manager. coming up, the largest vc market. we pull back the curtain on a special conversation on investing in china. that is next. check us out on radio. you can hear a whole lot more on the radio in boston, new york, d.c., san francisco and anywhere with the bloomberg radio app, bloomberg.com, sirius xm satellite station number 119. this is bloomberg. ♪

cory: welcome back to the "best of bloomberg west." i'm cory johnson in for emily chang. this week, we kicked off the new segment called series a, themes of tech investing. we launched a conversation about china. china have amassed the world's

largest arsenal of venture funds ready to be deployed in a market that is complex, fast-moving and often elusive to international investors. david chao and hans tung joined us to help illuminate the inner workings of china tech. talk to me about what we're seeing today in terms of investable product. david: first of all, they are two worlds when it comes to public companies in china. the ones that they go public on the u.s. exchanges, like the new york stock exchange and nasdaq. and there is a whole separate ecosystem around a domestic companies they go public. cory: companies in shanghai and the shenzhen? david: yes. and venture-backed tech companies could only go public in the u.s.

largely because the domestic market requirements are different. you have to be profitable. now, i think on the u.s. -- probably the best tech companies in general go public in the u.s. there are some dynamics that are changing that a little bit, but it typically is very choppy. we had probably 11 chinese company ipo's in the u.s. in 2015. the first six months of this year was zero until one of our early investments went public. cory: what do you see is different now? hans: what you see is that the company you are shorting -- a lot of them are not growing as fast and they resort to certain tactics. we safety engineer on paper what is interesting growth. the real story is the growth of the internet. internet enabled businesses in china. alibaba is 1000 x over a 10-year period.

both played a new economy w here internet allows you to build a big consumer business in a shorter period of time. cory: in a greenfield world, david, where some of these names are new, how do you sus out what can be real when looking at companies that are so young? david: the fundamental things you look at are similar worldwide, whether you are in the u.s., looking at startups. i think until maybe five or six years ago, a lot of the chinese companies were "me too" companies. when people talked about baidu, they said it was the google of china. cory: that is what i do. [laughter] david: the last five years,

largely because of the mobile market, innovation is starting to truly be cutting edge in china as well. and so, there has been a shift. we would look at what succeeded around the world, whether it is japan or the u.s., and maybe there is a copycat company in china that does well. i think the last five years we were fundamentally looking for innovative companies just the way silicon valley firms find a great deal in silicon valley. cory: you talked about some of these big gains early. do you look for the earliest stage of a company to invest in? is it different than taking early-stage company in silicon valley? hans: it is a different similarity. we all look for companies that are growing and have huge potential. on the team with a lot of experience, some of them are serial entrepreneurs.

you see that happening in china more and more, as is the case in the valley. you see a team that can build a product to solve a real world problem. that is very big. market, team, product is how we look at investments. cory: and when? hans: the earlier the better. cory: really? hans: when you invested 10 years ago, you did not see as many entrepreneurs that are proven. over the last 10 years, you have 400 or 500 companies that have gone public. there are a lot more vps and directors starting your own companies now. it's ok to go earlier because there are better entrepreneurs. cory: chinese counties are looking to the u.s. given the notion, and i will set the premise we have chinese entrepreneurs creating new ideas, but also give got them looking at u.s. tech companies. i wonder what the appeal is u.s. tech companies the chinese

companies that are looking for m&a. david: i think it is largely strategic. much the way in the 1930's gm started to sell cars outside the u.s., citibank going global probably in the 1970's and 1980's. in that sense many chinese companies, whether it is baidu, tencent, they are investing in u.s. companies wanting to see some of the cutting-edge technology and to bring you back to china. number two, they want to start dabbling in global expansion. as great a market as china is -- cory: you see a lot more now. you are nodding your head. as much as they might be

interested in technology, they would be more interested in just a beachhead where they can have access to sales teams and know some of the companies that sell their products? hans: i was part of a team that helped recruit hugo barra. there was a collective team effort to do that. hugo joined because he sees this interesting android platform that is emerging that can be more than just a smartphone. it could be iot. it could be beyond just china. a lot of former google and microsoft folks have it in their dna to have a shot at becoming more global. both of us are investing in a company. it is a new app. lively, it was number 1 -- cory: this is a china-based thing? hans: it is based in shanghai and 10% of the team is in san francisco. 90% in shanghai. cory: 80% are my daughters -- they are all over this app. they love this. hans: it originated in china and is on top of the u.s. charts. it was hard to imagine five years, 10 years ago. cory: coming up, the u.k.

struggles to make sense of brexit. what the vote means for venture investors. we hear from one of europe's preeminent funds. ♪

cory: as global markets try to recover from the shock of brexit, index ventures just wants to get back to business as usual. they backed silicon valley's like facebook and the headquarters is in london and works throughout the eu. the san francisco outpost is a few blocks are here. bloomberg's adam satariano spoke with jan hammer at their london headquarters to talk about brexit. jan: it has been a big shock to everybody. it has created a lot of conversation on a daily basis. everyone talks about brexit. there is no denying there will be impact. the greatest one of which will be uncertainty. adam: how is it changing your

behavior? are you doing things differently about how you think about the companies you invest in? jan: the advice we are giving is stay calm. continue building your business. continue building products and looking after your customers and making revenues. our business venture is a long-term play. certainly the brexit discussions will take at least two years of negotiations. we still don't know the impact ultimately will be apart from there will be a lot of uncertainty. the best thing we can do is carry on. business as usual. adam: does it make you think of a company based in berlin or another region more favorably? does it give you pause about investing in the u.k.? jan: as investors in startups, we have to be optimistic and support entrepreneurs who thrive on change. look at your opportunity. if anything, we probably think that with the decline of the currency here, britain has

become a lower-cost it it might be advantageous for entrepreneurs to set up here. more generally, we invest wherever entrepreneurs start their companies. certainly for index ventures, but we have seen this in the broader venture community. i think everyone will continue investing, whether it is in the u.k. or mainland europe. adam: if i'm coming to you for advice, and i want to set up an outpost in europe, my company is growing, i had been thinking about london but now what should i do? should i be thinking about going somewhere else? jan: the key decision criteria for corporations or startups -- certainly coming from america to europe -- would be in availability of capital and availability of talent. on the capital side, no change so far. it would be absurd to think

governments would put obstacles preventing investment. as regards to pools of labor, pools of great people to hire, so far nothing has changed. we will be watching carefully if there is any restrictions on movement of labor. but the fact is that would lead to a decision between london or any other european hub are probably the same so far. so far no change. adam: are you worried about a recession and the effect that that can have in europe and elsewhere around the world? jan: we are worried about recession. certainly the unknown gives pause to consumer behavior as well as company behavior to postpone decisions, to maybe not make that incremental investment or purchase. it's realistic to expect there is going to be a shock and an unexpected negative shock. having said that, startups are not driven by the same factors

as multibillion dollar multinationals. they are starting from a lower base, and therefore the growth rate is not necessarily affected by plus one or minus percent change in gdp growth. adam: do you think companies will go out of business because of this? jan: it is possible, but again, we don't know. certainly the entrepreneurs are nimble and adapt their businesses and business models. adam: should european startups be thinking more about m&a activity as a result of this? jan: i think that is a realistic scenario, especially with the currency decline. any sort of input cost that have denominated in british pounds will become cheaper for you. but that is a production base and it has become more attractive for european counties to acquire u.k. targets. they have become overnight

cheaper. cory: index ventures' jan hammer with bloomberg's adam satariano. still ahead, cyber security warfare. the worms to disrupt iran's nuclear efforts. now it is getting the documentary treatment. we are talking to the man behind the film about an incredible computer virus. this is bloomberg. ♪

cory: well, the stuxnet worm, widely believed to disrupt iran's nuclear program. neither the united states or israel has acknowledged this. academy award winner alex gibney has made this the focus of his latest documentary, "zero days." he takes an in-depth look at worm. alex: this was something that set a new paradigm, a new kind of weapon. a weapon that could take over machines. it was kind of a science-fiction

vibe to it that i thought would be worth investigating. cory: yet, eric, it took you to figure out what was behind it and how it grew? eric: at first we didn't know what this was. it was nothing like anything we have seen before. well we got to the end we discovered it was trying to basically attack iran's nuclear centrifuges. cory: how does this code look different from other things you have seen? eric: every time we looked at it, we would continue to find things that were not just evolutionary but revolutionary. an example. most code, you have to open an e-mail or click on a website. it spreads autonomously all by itself. you don't have to click on anything. this is extremely unusual in the threat landscape today. we discovered at the end ultimately that stuxnet was conducting cyber sabotage, affecting the real world. that is the kind of stuff movies are made out of at that point in time.

typically the kind of things people doing espionage or selling your credit card number. now we had something that can literally blow things up. cory: movies are made of that. alex, it is a computer narrative cliche that you try to avoid making this film? alex: one of the things we try to avoid, and this is what we got a lot of help from eric and liam, his partner at symantec, was just two slap shot the computer code. we wanted the code to be a living, breathing character. we have the stuxnet code in our office, but we wanted to make sure we were showing various aspects, control mechanisms, we were in the right part of the code and that it moved and operated in much the same way that the code did. we wanted to get inside it and have it be real, not some kind of phony backdrop. cory: eric, how ubiquitous was this code? where did it spread to? how far? it was ultimately targeted on iran, but where did spread to?

eric: it spread to all over the world. most of the sections we saw were in iran. ultimately, it escaped iran and began to spread anywhere and everywhere. if he had a windows machine connected to the internet, you could get infected by stuxnet. it is still out there today, spreading. cory: is there further functionality we can see in it? is there unknown functionality? eric: we believe we have analyzed it quite in-depth and gone through it with a fine tooth comb. but there have been multiple versions. and we believe there are versions we have never recovered. cory: alex, what surprised you about this story? alex: it was a computer story but also an espionage and spy story. how big an operation it was. the other thing that surprised me was how quickly the technology moved. we were exploring a kind of origin story, the first time a piece of malware jumped from the cyber world to the physical world and started blowing things

up in real time. we discovered in the process of doing this story another operation, another kind of attack launched by the nsa and cyber command called nitro zeus. it had a much bigger attack vector. it basically was targeting the ability to shut down the entire iranian grid. cory: final question -- was stuxnet a good thing? alex: well, it was a very smart and savvy tool for a particular operation, which is to say the slowdown the development of the iranian centrifuge program. but it was a bad thing in the sense that it launched a whole new arms race for cyber weapons. cory: that was academy award winner alex gibney and eric chien. that does it for this edition of "best of bloomberg west." we will bring you the latest in tech throughout the week. be sure to join us when we meet with ethan kurzweil on how to spot a moonshot.

see you then. this is bloomberg. ♪

♪ sydney, 9:00 a.m. in the first major market to open across the region. how australia reacts to the news that the ruling coalition will form the next government. this is "daybreak asia". ♪ right,a's price is inflation eases earlier, june cpi jumps more than expected. >> markets shrugged off australia's credit rating worries,