♪ i am caroline hyde. this is the best in "bloomberg technology." all of the industry leaders in the consumer electronics show including the founder and chairman barry diller. ceo joins us as verizon to mull through their options. tesla's words. -- tesla swerves.

the biggest tech trade show of the year, that consumer electronic show in las vegas. the annual spectacle office and early glimpse to watch in 2017 from smart home improvements to driverless car technology. another big seeing -- new competition in the field. >> if you are stock is subject to his comments being a negative drag, then you have to -- then you have a very lousy business. there were similar mergers last year. do you see any of those being resurrected?

>> they should've not been resurrected. if you're representing the shareholders, you are not going buy viacom. if you are on the other side, you will not sell it at anything but a premium. i don't know why everyone made noise. >> how would you try to turn it around? it ain't hard. make good movies. it is very simple. you have a story, you tell it. people either like it or not. there is no tech involved. it is quite binary. >> a lot of tech companies are looking at the content space.

amazon has made huge strides in the space. there has been a lot of talk about apple getting into this space. do you think companies need to own content? >> no, because if you own content you want to distribute it everywhere. these tech companies who are engaged in distribution, what apple and amazon have been doing, they are essentially distritors. they can by anybody's content. they don't need to own the content. will begin to produce content themselves, then that is another thing. really something you have to have an ability to make editorial choices. gate, ieal with lions would like to know how to kim about. -- i would like to know how that came about.

>> we were developing a platform everybody could use. why don't you put her programming on video on our platform, and they said yes. >> are there a few deals pending? >> yes. [laughter] >> can you give us a timeframe? >> no. -- we thinks, years because we have an independent platform, that is not owned by any totalitarian company, we had wehance that he, that -- have a chance because of that independence, we can pull through. [indiscernible] it is going to be a direct

pathway to those guys? >> indirect. be,lix is always going to unless they screw it up, i don't think anybody is going to be close to netflix. they takenot mean essentially the market share of the world. i don't think anyone will be as large. but there is plenty of rooms for , and programmers programmers with many subscribers, just not at their level. is cable tvead? >> i don't think anything really kills anything. >> unraveling? we have had for 40 years or so, you have had cable being the only place you could get a

bundle of programming. that is ending. now, all you need is an internet connection, and you can get little bundles, etc. cable has to eve all -- cable has to evolve. it is warehousing everything and selling it for one package price, then it will be gone. >> what do you think will work? what will be the model that goes through? i think that the cable operators are essentially now and the data transmission business, and no longer in the program business. they used to be in the program business with healthy margins. now, when you have so many different alternatives --they are in the data business. >> does this explain the

rationale behind this? perspective,tional is there logic behind that deal? >> i don't think there is a lot of industrial logic behind it. i don't pick a data company needs to own a content company, or a tech company. at&t does not need to own content. content at fair market prices. still ahead, we will hear from aol ceo tim armstrong about if the yahoo! deal will go through. we will ask about the potential hiccups, next. episodes of "bloomberg technology" are now streaming. this is bloomberg. ♪

♪ caroline: alibaba continues to crack down on vendors taking legal action again sellers. it is suing for counterfeit watches. this is part of a plan to combat it goods from popping up on the side. alibaba has reported it took down 318 million product listings enclosed store platforms in the last 12 months. cyber security is a hot topic from washington to wall street, especially in light of this week's hearing on capitol hill on how the russians did impact the presidential election. yahoo! announced last week's suffered a data breach, one of the largest in history, leaving some to question and verizon will follow through on his acquisition of the company. aol's ceo timith armstrong in las vegas.

the yahoo! deal for us is strategic towards our 2020 goals. we are hopeful it will close. the process for us is split into two areas -- one is the integration of strategy planning with the executive team at yahoo! that has gone very well. the second piece is information out about the breaches and what the effect of that is. verizon is handling the breach with yahoo!. yahoo! is going through its investigation. verizon is handling thewe do non that because they cannot finish station -- because they have not finished their investigation. stationwe will know more the ff of this year. the yahoo! team is doing a thorough investigation. i am sure they will have more to say on it. >> is it possible that these series of packs and the public's

knowledge of them has any effect on the brand that damages the brand of yahoo! in any way? that is one of the things that yahoo! was looking at them will continue to look at is the total effect of what the breach was, what the outputs of them are. we have a few point on that as well. froa standpoint of where we sit right now heading into 2017, our strategy is clear heading into 2020. yahoo! is one piece of that strategy overall. about theation breach, we will update people on netanyahu will as well -- as we get information about the breach, we will update people on that and yahoo! will as well. >> i think the size of the business of yahoo! is not properly understood. it is such a very big business.

when you look at that asset, what do you see that holds such value? the noise and the consent of the breach continues to dominate the discussion. what is the underlying value? tim: we live in a world where there are hundreds of billions of dollars and hundreds of billions of consumers. yahoo! is one of the largest footprints in the world on the consumer side and has a very sizable advertising business and an e-commerce business in asia. when we look at the combine asset, we would have over one billion consumers doing billions and billions of dollars in ad revenue. the verizon opportunity with data and targeting gain the mobile consumers is huge. there is the breach information and investigation, but from a

business strategy standpoint when you look towards the next five to 10 years, the assets coming together represent a very unique opportunity and scale. we have gone from company consolidation to industry consolidation. verizon has been very forward , very clear, and very clear on the execution on where they think the world is going in beta and wireless and mobile -- the world is going in the a and wireless and mobile. from my side on the integration side, the strategy remains intact. strategy of the consolidation is very interesting. when i look at the verizon site, i see you putting together a big pile of assets. you mentioned techcrunch and yahoo! sports if you will and pulse. all of these smaller pieces of content, but a kaleidoscope of them. at&t seems to be going big with

time warner, hbo. that is their content play. can you contrast those two strategies for me? tim: sure. i know the time warner strategy well. i was at time warner and have a lot of respect for the team and time warrior -- for the team in time warner. i do know that the verizon business model. at&t plan and t a low plan. -- and the at&t plan. connecting everything and everybody with fiber ends be and wireless -- with fiber and speed and wireless you do not have to look far and wide to see how the linear tv landscape has changed to a digital-focus consumer. if you contrast the strategies come in a digital and mobile

focus that verizon has put into place, i think it is a very strong strategy. after spending 20 years in silicon valley and in new york and across the globe, we want to put our bet with verizon because we think digital and mobile and the conductivity of the 5g will be a tremendous asset overall. you have two big companies, two strategies, and a lot of room for tailwinds in the future of growth. it will be interesting to see where we end up five-10 years from now. i feel very confident on the verizon strategy. i don't have any doubt that we will be in the running and big player in the future. caroline: coming up, big point rally has a new year lease of life. hitting multiyear highs geeking out 2017. what is behind the jump, next. plus teslas fourth quarter delivery or his top model s

missed estimates. this is bloomberg. ♪

♪ it was the best performing currency of 2016 and looks like bitcoin still has room to run. this become a the currency top $1000 for the first time in three years. we are joined by the managing partner for the d.c. firm to discuss what is behind it. block of what happened, changes transactions. there are other things coming. there are dozens of crypto currencies that are called old currencies --alt currencies. one is trading on coin base. there is another one called rebel. -- ripple.

that is being put together with a bunch of different banks collaboratively to manage ripple . there is one that is fully anonymous. the frontier is powerful. why is bitcoin so good? it is simple to understand. it looks like the dollar and euro. they cannot do a lot more things. the promise of the block chain cannot onlyr a coin have a currency value that is tradable, but have preset instructions. it can be a smart contract. you can preload the token with a set of rules. it is a derivative of rul that are present.

you're committed to the rules to behave a certain way and everyone in the contract can know that it is self-realizing. there is a lot of stuff happening on the frontier. bitcoin is the one that has the awareness of the public. >> we were talking about movement in china. china seems to be a real driver of trading in bitcoin. what has fostered this certain resurgence to three-year highs? is it the fact that bitcoin is being used more widely? the fact that currencies are open to deflation? >> if i had to sit here and ask the question -- answer the say it couldould be geopolitical risks. it got too hot and people took money off the table and now it is coming back in favor. the chinese and bitcoin are a big part of the puzzle and

mining so much bitcoin and have so much control of the bitcoin supply chain. that worry some of the people on the frontier. there is a sense that bitcoin is not truly anonymous. if you are a believer of the revelation --revolution of , you will seey the are the wave of the future. it is still very early days. wantbellious are not, you to believe that crypto currencies will become more adopted widely. will it become something -- missing is when will

crypto currency and bitcoin get wide, practical adoption? i have not seen most first taking it. >> we used to be able to buy your coffee in bitcoin. there is been a rollback of some of the applications. they are coming as the clearinghouses start to bless the block train and have invested funds. you will see more adoption. does it change my day-to-day life? no. i met a lot of founders and 2016. one founder i met does not have a bank account or use checks. the only thing to get paid by him is using crypto cards.

caroline: now two big news of the week during tesla hitting speed bumps. the carmakers latest delivery numbers missed estimates. 2016, the company produced 84,000 vehicles. editor-at-large joins us to discuss. the company said we will deliver this. when analysts said that is too high, they said we will deliver this. they put those numbers in their --they do not deliver. that they did not deliver. date of -- they delivered few were model s's.

nowhere near are where model s sales are. none of this is good news. >> what about the model 3? it is supposed to be the more price-friendly version. know is that they have missed every deadline may ever set. we can expect the deadline will probably be missed. they keep pushing it back. we both see if they get to that. we don't know what the price is going to be. these deposits are not actually deposits. they are fully refundable. for a lot of customers, we liket that these will be getting your foot in the door. a lot of people want the option to get the car. it is not a massive consensus

the market? >> it is not until it is, right? the numbers are not very strong. you saw a big difference the numbers and the stock right afterwards. the short-term trade is not reflect the valuation of the company. the company does not have free cash flow, or consistency in anything except for these announcements i get people excited. -- except for these announcements that get people excited. down.: china is slowing --the developments for apple

apple is pushing ahead in india big-time. whatever the equivalent is, that is what they got. they hope to get a break. they are still hiring. another contract manufacture coming to india that apple has used in the past. they are hiring operations managers and people who run factories. apple is clearly moving into this market, and they need to to recapture growth in the iphone, which they have not had in the last year. cyberne: coming up, with security concerns surrounding russia, we heard from the former

cia director. if you like bloomberg news, check us out on the radio. you can listen on the bloomberg radio app, bloomberg.com, and in the u.s. on serious access them. this is bloomberg.

♪ caroline: welcome back to the best of "bloomberg technology." i'm caroline hyde. cyber threats and security are emerging as a major concern for 2017 that came to a head this week. russia was front and center. on theirstood firm conclusion that russia was behind hacking attacks during the presidential election. intelligence officials said only russia's senior officials could have done that they -- done the data theft. we talked for bloomberg reporter. >> the three spy chief said they

have more confidence than they did in october when they first released the report same russia was behind it and that was the case. they pushed back why did it -- quite a bit of the public byticism they received donald trump who said earlier this week everything had been delayed, and he thought it was because they had to build their case. the spy chiefs make clear they had a very solid case and they will present the case to the president-elect tomorrow. >> you're talking at trump's push back. he took to twitter, his favorite form of discussion, talking about his nation with julian assange the 90 is an agreement with him, saying he is a big fan of intelligence. we are seethscreen. what about this unhelpful criticism? they were not too critical of donald trump as it could've been.

>> right. these guys all speak in a nuanced tone of they did not single out trump or his criticism directly. they did say public criticism of their work is not helpful or good from a row. i think it is something -- is not helpful or good for morale. these are skeptical by nature -- these people, by nature, are very skeptical. they are not accustomed to being put in the public eye front and center. we have not seen a time in the past where an incoming president so blatantly publicly questioned their work before taking office. there is a whole range of issues at the president-elect will have to count on the intelligence agencies for, whether it is the latest assessment of islamic state to china's move in the south china sea.

without that kind of information, a president is flying blind. meantime, trump continues to weigh appointments concerning to national security. we learned former indiana senator is set to be the director of national intelligence. former cia director james woolsey spoke to bloomberg on how we should focus on the bigger picture as trump transitions into power. james: this is a blip. the intelligence business is full of controversy and arguments about assumptions and why did you do this? what do you mean by weapons of mass destruction and on and on? this is a hiccup. >> it seems that the president-elect is taking a different tone with the intelligence community. what is the relationship supposed to be like? what has it been like a starkly between the president and the intelligence community? to be the president ought

taught a great deal by the intelligence community about how things work. it takes a bit of time because some of these areas are fairly technically complex. but as you learn about them, you get to do a better job of understanding what we know, and what we can draw conclusions from. teacherkind of older /student relationship. but this student is the president of united states and the holder of the most important powerful role in the world. it is a different kind of relationship. i have worked with for presidents -- to republicans and two democrats. they have all been willing to hear out a different take on things. i have no reason to believe that donald trump will not do the

same. importantat it is that the intelligence community help the new president, and not -- city backback and criticize. go back to metaphor about teaching. how awesome come up for a lack of better words, get that information. is donald trump spending a lot of time in class? james: you can have seminars, lectures, lots of different things. in the two years i was director of central intelligence for president bill clinton, he never had a morning briefing. he did not like to be briefed. he did not like to have stf read to hi he was a speed reader, i suppose. andy like to go through things quickly, and then maybe ask

questions on the side, write a briefing.ook a bill clinton did things like that all the time, which was different than sitting there and taking the morning briefing, but that is the way he wanted to work. however the president of the wants toates information presented to him, people need to accommodate him, and not sit back and grumble about it to the press. >> let me return to the previous tweeting give him the benefit of the doubt and say perhaps he was joking about the matter here. what would you say and the intelligence community who does not welcome this skepticism from the president-elect, and questions the president-elect's commitment to the job? say, pullould

yourself together and get back to work, or find a different job. intelligence is important enough, tough enough, and from time to time, angry enough that it is important not to get distracted by small matters. if somebody comes at you, whether it is the secretary -- cabinet secretary, vice president, national security advisor and tries to push you off point and you think you are right, you address it clearly. this is why i think it is right. , based on a couple of meetings i have had with him, that donald trump is a fair-minded, balanced individual. he talks quite reasonably about matters in small groups. caroline: coming up, the techs tech surprise.

we discuss what investors should keep their eye on. this is bloomberg. ♪

♪ caroline: online publishing company, medium, is putting roughly people --is announcing it is changing its business model. n/a a blog post wednesday, williams called the model broken post wednesday, williams called the model broken. kathy chen, the company's top executive in china is leaving twitter after eight months on the job. she is taking time off to pursue more international opportunities. she was hired to seek a new advertising revenue and other business in china and taiwan. now to check surprises of 2017.

rbc is predicting amazon will undergo a major investment cycle this year. that is not a huge concern for investors. rbc says amazon has reached a point where it can shell out big bucks and still boost its margins. this as a company says a number of merchants using it for just -- a number of merchants using its -- , we caught upazon with an analyst. >> the one big difference between amazon today and amazon 20 years ago is there is a web service, a cloud business, that 10x margins. what that means is they have a lot more cash with which to make

investments. the say they are going to make aggressive investments, but still run the business properly. that cloud cash cushion allows them to do that. >> what are your top 10 investments of 2017? let's have a look at where potentially the banks could perform versus s&p. we saw last year, not so pretty. they did like the s&p 500 overall as a benchmark. what about 2017? the year of dramatic outperformance. it is very rare to see a performance two years in a row. 2016, frankly, up until the top election, -- up until the trump election, it had outperformed. that will be a headwind for a while. there are several interesting

stories. first is netflix. they can add more sobs in international markets. secondly, facebook. they minus of perform the market they share, but the multiples come down a lot. for the first time in three years, we can make money on the long side. >> looking at the chart, it performed. i want to dig into google and into the lag of 2016. you said that there outside bets and bring in money? >> that would be a surprise. when we say surprise, we think it is something that will not happen. -- netflix'sso multiple has come down. nest and home

automation? there have been management changes. the market has tuned out the segment. there was an interesting bets put in. when it comes to autonomous vehicles, there are probably three winners, and google will probably be one of them. talking of winners, you think onarket is too optimistic twitter. performed twois years in a row. the street believes there will be a rate celebration of growth this year. read celebration of growth -- eleration of growth.

we not see major advertisers fully embrace twitter. they seem to be pulling away from it. >> twitter does not seem to pretty. bit of saying there is a a concern. the outlookt change at all? >> there has been a rotation towards new areas. this has been a very slow growth economy for a while, so premium growth stocks have outperformed. rest of the economic growth seems to be picking up, i get the point. there is a less of a need to pay for premium of growth. of whether trump will

have an impact on the internet stocks, it is unlikely. we watch for net neutrality that could negatively impact netflix. and this talk about the border adjustment taxes, putting taxes on changing how you would allocate cost companies. that could have material negative impacts on amazon. we do not think i will come to pass, but those are two watch areas for us. >> it was a call last year and did not come to bed, but will y elp gets sold this year? >> it is a great playoff. there is a range of readers out there -- there is a range of bidders out there. you finally have a seller willing to sell. in another funding for

this week, silicon valley -- says they raised money in the final funding round and wraps up manufacturing ahead of a potential ipo. the bus maker expects to go public this year or early 2018. coming up, while the months of anticipation, a glitzy unveiling. not all went smoothly on stage. we will tell you why. and reminder that all episodes of "bloomberg technology" are now live streaming on twitter. this is bloomberg. ♪

♪ week for it was a huge the auto industry. here are a few headlines that

caught our attention. it fiat chrysler unveiled a battery-powered self driving minivans. a 200 50ltaleror has mile electric range and take care of most of the driving. it is a concept car and there is no guarantee it will ever be built. stake.s seeking to buy a they must pass an inquiry before the deal proceeds. ford announced its canceling plans to build a plant in mexico. instead, it will spend $700 million in michigan at a plant. >> we are the number one seller of plug-in hybrids in the united states today and the number two seller overall for electric vehicles. we want to build on that.

you can see through that -- you can see that through our announcements and we only talk about seven of the 13 vehicles coming, so there are more to come. another glitzy unveiling from another startup. after showing off a concept car, the company came back with his first reduction model -- with its first production model and they say it could outperformed tesla. it is backed by an ambitious billionaire. we discussed with editor at large cory johnson and celine line who covers bloomberg. >> it is interesting to see how many companies are able to work with these technologies. it is not tesla's game alone. the automakers, with start of

,ite this, companies like ford audi, bmw, working on these ideas. lot ofe is doing a interesting work surrounding electric cars. billionaire was him,e event and it was saying the car did not quiet park. -- quite park. >> the billionaire behind it is very well known in china and known for being very brash, ambitious, and sometimes too ambitious. he started out at the -- he started out as a local i.t. guy. he invested in the netflix of china. he quickly expanded into a fool of other things ranging from smartphones, tvs, movies, smart

bikes, you name it. seeing he mayre have expended to aggressively. an internal memo to employees that they are moving too fast, and having trouble raising cash. he is a very well-known person in china. he said that apple is a slow innovator and we can out beat elon musk and tesla. ousted another ambitious man. model wase tesla unveiled, elon musk cnot get the trunk to open. he got out of the car and smacked his head. he is a very tall guy. demos are hard to pull off. every ceo of every industry don't think they have to go on stage and introduce their products. one thing i tend to

find at tech conferences, is that tech does not work, as well as the wi-fi. -- how much money is he losing? >> he put $300 million into his own money into this. shares of his publicly traded companies and plows them into his ventures. we learn that you can reserve his car for $5,000. it is unclear on how much it will retail for 2017 -- 2018. there was a lot of skepticism around faraday's future. it was many a concept car. functioningural car, but we have a lot of questions hanging in the air. how are they going to make money? it is expensive to produce.

it is unclear what the business plan will look like. caroline: 5000 ordered. talk to us about what is going on at tesla. corey: we will see. tesla has a history of missing its own deadlines. the production issue will happen to all of the carmakers. production is hard. tesla said they could not get out as many cars as they wanted. these are recurring problems. it is hard with the business with the model x and the model s. they would have to more than double production this year and next year, which they had been unable to do. caroline: but the giga factory. the shares are popping up 4%.

factory hit their deadline. corey: the factory is running. how much they are producing is a question mark. and if there is demand for this product. there are dozens and dozens of competitors. caroline: selena, what do you think about the debate going on when it comes to ces? whether it is the tech companies or auto companies. faraday wants to own the data. what is the value of what they make him the actual card safe -- they make on the actual car itself? >> they have a unique vision and -- i had a chance to sit down at their headquarters. he laid out a broad experience.

you have yourself own a started watching a movie on it. autonomousy hail an vehicle. you exit the car and finish where you left off. then you had -- then you watch it on a smart tv. cars are integral part of the vision. vehicle is another place to watch content. let's remember this company started as a software content maker. all of these devices and hardware cars, smartphones, you name it, are just shells to hold their software. it is a very broad vision. cory johnsont was and selena wang. that does it for us for the best of "bloomberg technology." tune in egypt 5:00 p.m. new

york, to plug in san francisco, to the clock p.m. hong kong. that is all for now. this is bloomberg. ♪ . .

♪ erik: coming up on "bloomberg best," the stories that shaped the week in business around the world. from confronting carmakers to dismantling obamacare, the donald trump transition gather s speed as inauguration day approaches. >> clearly, we see a better manufacturing business environment under donald trump . >> we are going to try and protect the insurance coverage that americans have today. erik: chinese currency surges against the dollar and all signs point to tightening at the fed.