reporter: it is 1:00 p.m. in hong kong. china exports remain subdued over week global demand. shares fell 6% in dollar terms, while imports rose 3% to leave a $41 billion trade surplus. china's customs office has warned that the company faces a grim trade situation. the pboc is said to have asked banks to stop processing cross-border yuan payments unless inflows matchup flows. authorities have been boosting measures to limit a record amount of money leaving china in

local currency. shares are looking like this in mumbai, falling 2.5% after its earnings topped estimates. although net income came in at 37.1 billion rupees, 4% higher than analysts forecast, we are seeing it falling right now as it did cut its 2017 sales growth in dollar terms by up to 7.6%. a day,news 24 hours powered by more than 2600 journalists in more than 120 is bloomberg.s let's get you a check of the markets. afternoon trading just getting underway in hong kong and china. this is bloomberg. ♪

caroline: i'm caroline hyde. this is "bloomberg technology." amazon lining up job offers for u.s. workers. plus, the $85 billion dollar elephant in the room. at&t objects the with the president-elect at trump tyler, but the merger with time warner never came up. and the next let's -- and the next let's blueprint. -- netflix blueprint. brazil becomes the latest target in a globally ambitious plan. now to our lead. amazon pledging to create 100,000 new jobs in the u.s. over the next 18 months. this follows similar announcements from tech heavyweights like alibaba and ibm. amazon has been growing rapidly, but could this announcement keep the company on the right side of the incoming trump administration? speaking wednesday at a news conference, the president-elect once again emphasized the importance of job creation. mr. trump: we are going to create jobs. i said that i will be the greatest jobs producer that god

ever created, and i mean that. i am going to work very hard on that. caroline: spencer covers amazon for bloomberg technology and joins us from seattle. and with us for the hour is our ethan.host, now, first of all, to you, spencer, give us an idea of whether this is another p.r. stunt or if there are concrete plans coming from amazon to enact these sorts of jobs? the plans are concrete, and this is a pr stunt. this is like amazon jeff bezos' playing a jedi mind trick on president trump. "don't worry about monopolies. we're going to create 100,000 jobs." this is what it is all about, being on trump's good side and not his bad side so that he can

direct his twitter stock-crushing death ray at some other company. caroline: strong words. we know that jeff bezos has an awkward relationship with donald trump thus far. but what about the actual positions that they will create 100,000 jobs? where are they coming? it was alexa seems to dominate the a.i. space at ces. is it groceries, is it fashion? spencer: it is all the above. you are right to hit on alexa. that is extremely important to them. they want to be the voice activated interface in your home, in your car, in your hotel room. that is going to be a huge part of it. fashion and grocery are big pushes on e-commerce, and also just their overall network of warehouses around the country, and their delivery infrastructure around the country. let's not forget about their cloud computing division. that is going to be a big piece as well as their movie and video programming initiatives, will be a big part as well.

caroline: thank you for joining us today. you can give us your idea, how do you digest yet more jobs coming from the tech giants? do you feel it is a p.r. stunt? ethan: there is a little bit of hocus-pocus going on in that they want to get the headlines associated with that number, 100,000. that sounds mind-boggling especially when the other knobs -- announcements have been lower, 800 jobs here or there. 100,000 sounds like a lot and in the same time talked about their various initiatives, a.i., drones, aws, which is a juggernaut. most of the jobs they are creating are probably on the roadmap already. their jobs in their warehouses, their jobs -- those are not necessarily the bulk of jobs are coming from those higher tech initiatives. i think it is smart p.r. but also a good strategy at the same time. caroline: spencer, what about jobs in the united states? we have known before that offshoring has

been the way to go. a key for labor and stronger talent pools in many ways. is this the right time to be onshoring these jobs? spencer: they are not on shoring any warehouse jobs. you cannot offshore a warehouse job. that has to be here close to people. that is one thing that differentiates amazon from other operations. they need that infrastructure close to people. they need american workers. so, offshoring is not much of a threat from amazon as much as automation might be. but even with automation, they are using more robots, using more automation in warehouses, and they are still hiring thousands and thousands of people. so, i don't see off shoring is really an issue so much for amazon. caroline: i think this is an interesting element when there has been much concern about automation that will be the death of many jobs, rather than international trade or growth of other countries. is automation going to be a job

killer, or can you have the two go hand in hand? ethan: amazon is doing a smart thing by showing that automation is not necessarily a job killer, which i would agree with that. what they are saying is we have automation. a lot of the lower skilled jobs are becoming more interesting work, and there is more of those things that technology is going to touch, but they are creating jobs in other ways. they are creating jobs for higher-level skills, like moving things around warehouses and things like that. and so, i think in the long run, automation will take out some jobs, but it will create other opportunities, and amazon as a good example of how that works and how you can get on ahead of that. caroline: spencer, is there any view from donald trump whether he will make it easier to hire for companies who say they will onboard 100,000 individuals? spencer: i do not know that donald trump has much of an issue on that, perhaps with the minimum wage thing, but amazon has been well above the threshold of that debate.

and for them, the challenge hiring sufficient numbers of people has been more on improving economy and upward wage pressure, particularly with their warehouse operation. they are high skilled and tech jobs. that is a company that can recruit people. it is an exciting place to work. people want to work for amazon. for the warehouses, that's where the bigger challenge is, just as the economy improves and people have better options and perhaps a better pay. caroline: perhaps a bit of a p.r. stunt needed there is to quality of work-life balance. spencer, fantastic to have you on the show. host, will guest stay with us. a developing story we are monitoring. lyft lost $600 million last year after generating $700 million in revenue. that's according to a new report from "the information." even though the company lost have a billion dollars, among

those are a big improvement from the previous year. in 2015, lyft lost twice as much as the revenue it brought in. still to come, the netflix playbook for winning over a foreign market. bloomberg businessweek travels to brazil to learn how the company went from bust to boom in five years. that is next. and a reminder that all episodes of "bloomberg technology" are now live streaming on twitter. check us out weekdays at 5:00 p.m. in new york, 2:00 p.m. here in san francisco. this is bloomberg. ♪

caroline: a story we are watching -- apple might face a consumer class-action lawsuit claiming it has a monopoly on the market. an appeals court has revived a case that was dismissed in lower court. a lawyer for the plaintiff says

that millions of consumers should be able to recover most of apple's 30% take from apple store sales. sticking with apple, it is looking to expand its music subscription service beyond songs. according to people familiar with the matter, the company has been speaking with the makers of original programming about buying rights to script tv shows and potentially movies. it is seen as a bid to differentiate apple's service from spotify, which has twice as many subscribers. and staying with on-demand streaming, netflix is of course the chief instructor in the space for tv, but it has had to move fast to fend off rivals abroad. check out my bloomberg at the moment on the terminal. you will be looking at the operating margin. just at 4.6%. came off those lofty heights of 10% in 2014. nose dived in 2011. this, as we see marketing spend build up as they enter new markets and they have to be

splashing the cash. are we going to start to see that ticking higher continue? plenty more expansion to come. the global ambition of reed hastings is the focus of the latest edition of "bloomberg businessweek." media reporter lucas shaw joins us with more from los angeles. lucas, interesting when we are looking at these particular numbers and how they seem to have gotten a blueprint going in brazil. it was from bust to boom. how did they do it? lucas: netflix's strategy and ever new market is to go there, figure out the problems on the ground, and solve them gradually. they believe they can learn a lot more in the first 24-48 hours operating in a country than they can in preparing to go there. in the case of latin america and brazil, they went there in 2011, had a slow start for the first year or two, admitted as much, which they do not typically do about specific markets anymore because they do not have to identify their subscriber bases

in any of those individual markets. , invested in making sure people could get higher streaming, that there are more smart tv's in the region, that that was more tv shows and movies tailored to the taste of that particular region, particularly the kind of young, tech-savvy urban people who are the early adopters of a netflix service. then you saw over the past couple years them really take off. caroline: also still with us is our guest host, ethan. you know this space intimately well. some of your portfolio companies are playing actively. is netflix doing it exactly right? are they right to the suppressing margins paying out in the markets expanding internationally? ethan: absolutely, it is a smart strategy. what is happening is each

household in the past watched about 4.5 hours a day of television. that is what is up for grabs. that is shrinking slowly. we are just across four hours. that will eventually, over the fullness of the next decade or so, go to zero. and all of that will be replaced with internet connected devices like netflix, periscope, like twitch and youtube too. netflix was to get as much of that pie as possible in their orbit in streaming subscribers. and so, if you have to take a long-term view of profitability, which they can do because they are a public company and they have established a blueprint for this, much like amazon we talked about earlier, that is a very smart strategy. and it will work. the question will be do they get the content right, the pace right, do they market it right? there are a lot of operational details, but i do not disagree with the high level at all. caroline: just talking to us about the way they marketed smarter, better, faster in brazil. now they have got 100 more countries who deploy those learnings from azerbaijan to all

sorts of countries. have a bitten off more than they can chew? lucas: it is really too soon to tell. you see with latin america, brazil, it took them three or four years to say this is a success. it was a rough go of it a couple of years. and then, with time, they find -- even now after five years in brazil, they are at 4 to 5 million subscribers, which is good for netflix, but a small fraction of the market. you look at every other country they went to last year, they expanded to 130 countries. chances are they have a very small subscriber base they are still trying to figure out. we may not know how successful they have been in azerbaijan or nigeria or whatever the country is for three or four years from now. we will we will start to see some inkling. they report earnings next week. playing the long game. it will be a slow go of it for them and for us observing. caroline: and competitors -- as i say, you're in periscope,

you're in twitch. you have a great blog about how video is eating the internet. who are they defending themselves from? ethan: multiple sites. there are multiple ways people get what is called premium content, the kind of content netflix makes originally or they license it from hollywood. and then there is all this generated stuff. snapchat is a rival to netflix. other user generated things like periscope, like other apps, like houseparty, where people are paying out with their friends and consuming in a messaging experience. they are getting competition from all sides. and people have shown they do not necessarily desire a premium, hollywood, glitzy experience for content. stuff like the creator and their bedroom on youtube, that's compelling to some audiences, some millennial audiences. netflix has to fend off and be a player in the hollywood glitzy content and be relevant to people that are excited about other content at the same time. caroline: it's quite phenomenal,

$6 billion a year on content. we will see if they can keep the hits rolling. lucas, another story in your beat, pandora says it is cutting about 7% of its workforce. the company also saying that fourth-quarter results exceeded its forecast thanks to stronger ad sales and listeners signing on to its paid offering. but lucas, give us more context around this, because there have been changes at the top of pandora as well and plenty of competition. lucas: pandora has spent the past year or two trying to figure out how to sustain the advantage they once had. pandora was an online radio service before online music was a thing anybody did. they amassed tens of millions of users. they still have close to 80 million users. but recently, spotify, apple music have come along and taken a lot of the thunder away from that company. it is not the sexy choice in that area anymore. pandora changed its ceo, reinstalled tim westergren last year. they are in the process of introducing two paid services.

this is another sign of their efforts to right the ship and potentially make them look attractive to someone out there since there has been a lot of talk about whether they will or will not sell to somebody. they're simultaneously cutting costs and saying their performance is better. that is the reason the stock is up. that does bode well headed into their earnings, which is also in just a couple of weeks. caroline: up 6.3% as we speak. lucas shaw, thank you very much. our guest host, ethan, sticking with us. coming up, the first major tech ipo of the year is around the corner. after a slow 2016 -- will they encourage other tech companies to go public? this is bloomberg. ♪

caroline: alphabet shuts down its titan drone internet program. confirmation did not come till early wednesday when a technology blog reported to move. google acquired titan aerospace in 2014, beating out facebook in the bidding. the vision was to beam internet access from the sky so more people could log on from remote places. now app dynamics is gearing up for the first tech ipo of the year. according to an sec filing, the software company plans to raise $158 million in its initial public offering. and a concurrent private placement, and the price of shares on january 25. speaking on this is my guest for han of bessemer venture partners. one of your portfolio companies is one of the only success stories of 2016. it went public. is 2017 looking to be the year? ethan: that is the buzz right now. i tend to be contrarian and do not believe in market timing, in terms of this is the right time

for a company to go public. if you rewind the clock to win truly a went public, that was not a great time to go public. they had what many industry watchers would tell you was a very smooth ipo process. caroline: double where they started. ethan: yeah. i think people's ability to predict the market timing of if now is going public, is voodoo. there are a lot of companies that subscribe to popular thinking with health last year, the election uncertainty, app dynamics being one of those. i do believe we are going to see more ipo's. people are going to say this is a great time for companies to go public. it is a self-fulfilling prophecy. caroline: you also have to look at how the company is performing. one in your portfolio came back away from ipo's.

it has got to be the right time for the company, as well. ethan: i cannot comment specifically on blue apron. but i think app dynamics, just as every company does and they're thinking about what the right timing is, they look at, they have conversations with the analysts that are going to cover them, they look at their projections, their ability to understand their business and decide, is this the time that we want the scrutiny and rigor of a wall street offering or not? and companies come to their own conclusions on that. caroline: investors want to see the perfect mixture -- growth, cash flow, perhaps control of costs. how did it get that perfect mix? ethan: the biggest thing that is correlated to how successful an ipo and a company trades is efficient growth. how much are they spending to get that growth? and then there are other factors like, what is the overall size of the market opportunity, and what longer-term could this become? efficient growth is what people are valuing, that is different than in the past.

caroline: and what about app dynamics and looking at market size? is this a place that we should be looking at, productivity, developer tools? ethan: this is a place that is near and dear to my heart. we invested in a ton of developer platform companies with similar dynamics to app dynamics. it is companies that make developers on the infrastructure teams more productive, more successful in their jobs. as a result, they get to choose what technology gets adopted, which is a change in the past when you had top-down decision-making around tech. these are technologies built for engineers and developers that they are adopting and using to make their velocity faster. caroline: i look at some of the startups in your portfolio, there is a lot of m&a, twitch to amazon, periscope to twitter. we are just seeing twillo being sold in a peer to peer m&a space. are we going to see a lot of m&a's as well as ipo exits? ethan: they tend to mirror each other.

i think wall street understands the power of that business model. individual developers make decisions. it is cheaper to sell to them. app dynamics, which sells a big enterprises, does not have that characteristic, but a lot of other companies, they do not have to spend as much on sales and marketing. wall street likes that. so the result is more and more companies using that business model, figuring out how to instrument their business around a low touch sales model. and will have success on wall street. so maybe more of those companies will go public than in the past. caroline: ethan, such great perspective. sticking with me. coming up, at&t's ceo randall stephenson just met donald trump. so, just what was discussed? and maybe more importantly, what wasn't? and if you like bloomberg news, check us out on the radio. you can listen on bloomberg radio app, bloomberg.com and in the u.s. on sirius xm. this is bloomberg. ♪

shery: tech out of bankshares surged in tokyo on reports that the company is close to reaching a settlement with the u.s. justice department. it is believed that the fine could be announced as soon as friday. the automaker may also face criminal charges after devices are linked to at least 17 deaths. nintendo's investors have been turned off by the climb ofan-expected the switch. shares falling at $300 a piece. the consul is more expensive than the playstation 4 and microsoft xbox one.

most analysts had expected the price to be around $250. the console will go on sale on the third of march. tata names a new ceo. net income has grown fourfold. down more than 3%. china's push back against hawkish comments made by donald trump against rex tillerson says beijing should be restricted from islands in the south china sea. china's state media says unless washington plans to wage a war, and the other approaches to prevent china's access will be foolish. global news 24 hours a day, powered by journalists and analysts in more than 120 countries.

you are watching bloomberg. let's get a check on the markets. here is juliette saly. juliette: we are starting to see day weakness created as the grounds out in afternoon trade. shanghai turned negative. it seems investors were shrugging off that cap export data coming through. by and 1/10 weaker of 1%. hong kong now in the black. a good week for hang seng. the stocks up by half of 1%. we have seen solid movement coming from japan, stocks up on the yen against the dollar. the aussie market closed down 1/10 of one percent. weakness in new zealand as well. a little mixed about the southeast asia markets. of 1%.re up by 6/10 we have just heard that toyota is expanding its tie, bang airbag -- it's the content bang airbag recall. rbag recall.

morgan stanley is saying it is encouraging that we have seen the government or into the company. we will be live from london at the top of the hour. this is bloomberg. ♪ caroline: this is " "bloomberg technology." we are revisiting our top stories. donald trump continues to push his agenda in u.s. commerce, promising he will create jobs in the u.s. and probably scolding those who have moved positions overseas. amazon heard the message loud and clear, announcing it will create 100,000 jobs over the next 18 months. keep in mind, bezos was among a group of leading technology executives who met with trump -- lastth, best buy month, despite the two men exchanging hostilities. meantime, while trump hosted top media execs at the trump tower on thursday, at&t's ceo had an hour-long meeting. randall stephenson and robert quine spoke with trump about how

the company can work with the trump administration. in a statement, at&t said the proposed merger with time warner was not a topic of conversation. remember during the campaign, trump has said he opposes the $85 billion deal. since at&t's purchase announcement on october 22, well, shares have traded well below the offer price of $107.50. still with us, ethan. and joining us from princeton, new jersey is john butler of bloomberg intelligence. john, elephant in the room -- doesn't seem to have been discussed. can we believe it was just about job creation here? john: no, actually i do not believe it. i know trump has been very upset at cnn, which is a time warner property. you know, he has opposed the deal. again, i think it is aimed at, you know, limiting the further power of the media, let's say, through greater scale which is

what would happen with the merger with at&t. so, i suspect it came up during the meeting. caroline: ethan, whether or not we believe past statements or not, the deal, do you think this is a wise move coming from at&t? content is king, a theme we have seen across deals within the united kingdom and within europe, but this is $1 billion -- an extraordinary amount they will be spending. ethan: i think there are two ways this could go for them. one is that it's a brilliant deal. at&t sees all the internet, allows the internet coming to their backbone. and they see the future of what was television content is now being streamed through a connected device. and they can control that content and they control the means of delivery of that content. that is the sort of positive scenario here. the negative spin is that content is coming from everywhere -- coming from our mobile devices, coming from kids in their basements, and the

power that a property like time warner had with cnn, very curated with their movie studios and things like that, it's expensive to produce, and less valuable in the future. so, there may be some degree of overspending there. i don't know. we will see. caroline: john, we just had ethan talking about potentially the pipes owned by at&t. interestingly, they have also seem to have been hit out in the last days of sec chairman tom wheeler's stay. 8 days till the republican administration comes in. he seems to be drawn criticism of breaking the news of net neutrality. john: i think it is a little bit too late for wheeler to hit at&t with a stick on that. i understand where the argument is coming from. at&t would turn around and argue that the reality is these are the benefits of scale. directv is an important property for them.

and they are distributing that product over their network. under a republican administration and under the trump administration, you are not going to see this kind of pressure coming on the telcos, arguing for them to, you know, impose limits based on net neutrality or any other issues. i think you will find they have a lot more freedom. caroline: do you agree that under this administration we might see more freedom coming for businesses in general? ethan: i think you can believe trump's recent statements on it, absolutely. he has not been a fan of enforcing net neutrality. seems from the face of it to be ok with this kind of thing. so you can argue that at&t is just getting a jump on what will be a more lax regulatory environment in eight days. caroline: the question is whether regulatory environment allows deals such as the deal between time warner and at&t. john, how much power does the president actually have?

the rules don't seem to apply to the president-elect, but theoretically, he's got to be within arm's length of the justice department. john: he does. he is not king, right? there are limits to presidential power. the fcc only gets involved when there is a transfer of broadcasting licenses, which presumably there are not here, then the doj actually has to sue to block the merger. and typically when they go to the courts, when they sue, they're suing because of the concentration of share. in this case, you're talking about vertical integration. so, you know, they would have a weak case at best. again, i warn that i am not an m&a lawyer. but again, i do not see a case really here against getting this deal done. caroline: ethan, if the deal does get done, we are seeing vertical integration, but if it

-- who do you think many other rivals will see that this better's right content remains king and expensive content, or will m&a trends dampen down if people try to buy into a good point raised by you that expensive content is what people want? ethan: the immediate reaction will be to want to do the same thing. you're watching at&t make this major purchase, potentially get it through the justice department. i agree the analysis that it is harder to make it appear anti-trust, concentration or a share case on this kind of a merger. there are other aspects of antitrust law that can be erased. assuming it does go through, you will see some jealous other media moguls that want to do the same thing. and then i think, over time, we will learn the truth about how effective it is. the real integration work, those stories, tend to come out in the

fullness of time, and whether it is a complete disaster as aol-time warner was, or something more synergistic, we will know, and that will determine the future landscape whether this consolidation happens, or whether we have a move towards breaking things apart. caroline: and hopefully we will be there to report. thank you, again, ethan. john butler of bloomberg intelligence, wonderful to have you with us as well. a story we are watching, chinese filmmaker xiaomi aims to exceed $14 billion in sales this year as the ceo says the company has grown too fast. the company is stopping us tradition of revealing how many phones it sold the previous year. it missed its 2015 target and falling behind local rivals. analysts report that 2016 was not a year for them. still ahead, the brexit vote was thought to bring a slowdown in the u.k. tech sector. but there are signs that things are still looking up. we will explain next. ♪

caroline: turning our attention to the u.k. the country's largest online lender focused on small $100 million raise in funding. backed by black rock and index ventures, it is the biggest round of u.k. funding since 2015. and bucks the drop in investing in recent months. the cofounder spoke with ed robinson from london about what is driving growth in the company and where the funding will be invested. take a listen. >> we grew in the u.k. business more than it 60% q3 to q4 in 2016. i think growth in 2017 is going to be strong. i think it is not going to be quite at that level. i think there is a certain amount of catching up as businesses held off making those

investment decisions. but clearly, there will be a lot of growth in 2017. you know, and i think what is fantastic, and we saw with the u.k. chancellor making a quote today talking about the jobs that get created off the back of the lending that we do. so, in total, $2.5 billion has been added to our platform so far. 1.1 billion pounds last year alone. if you think about the jobs that are created, it is about 60,000 jobs in the country. when we think about brexit, one of the biggest worries is about what it will do for the economy and in europe, and what will he do for jobs? and that is why we are so happy with today's announcement. reporter: you were referring to the comments made by philip hammond. he observed that funding circle is in the mix, and he was basically applauding the equity round as a vote of confidence in the economy. unusual to see a finance minister weigh in on particular company, but i think it speaks to the support the government

has long provided in the development of alternative finance community in the u.k. after the crash. that being said, the regulator in the u.k. in december, the financial conduct authority, did put out a report which was a little surprising to some and that it basically signaled that there may be a crackdown coming. there may be some more regulatory restrictions and rules in the year to come on transparency issues and how the peer-to-peer lending platforms operate. how concerned are you that that will change up your business? >> i do not think it will affect our business. we are very pleased that they are doing this. we work with the u.k. government to bring regulation into the market because we knew this market would be worth billions of pounds. in the u.k., around the world, when you become regulated, we want to be involved in making that regulation right for the activity we do.

now, some of the requirements they are talking about, i do not think anyone will disagree with. ultimately investors, large or small, are making decisions through our platform. they need to have transparency on the data, understanding what is happening with returns on their loans. the current regulatory regime does not explicitly say, you need to show performance and this is what you need to show. now, the peer to peer finance institution in the u.k. actually has some of those requirements in its articles. i think what the fca will do is copy some of those rules. and other points on wind down plans. and it is only right in a growing industry that the regulator should be concerned about if a platform did fail, what would happen? you know, there are three or four big players globally in this space. and there are 80 platforms applying for regulation.

so there are a lot of smaller platforms. it is only right that the regulator looks at the blueprint of how these platforms grow and make sure it is done in a safe way. we are very supportive of that. ed: the $100 million rounds, it is a series f. existing investors were behind it. index ventures were among those that took part. what is funding circle going to use the money for? >> all of our existing investors have come aboard to back us. i think that is a really, really good sign. we are going to use the money to invest more in our technology platform. our vision is super big, that funding circle. we want to be the number one choice for small businesses around the world. that means we need to build a scalable technology platform which we can take across multi-jurisdictions, etc. so, we will be using this money to do that. and to create what we believe is a category-defining product for

our investors and for our small businesses. ed: this is to build up in for -- infrastructure for expansion to new markets? >> it is for new markets, it is for technology which enables us to go into those new markets, and it is for talent. we want to hire the best people. ed: a hiring boom at funding circle? >> it's the best people. it is not going to be double headcount or anything like that. that was funding circle's cofounder speaking with ed robinson. moving back to president-elect , trump steam announced another appointment this thursday. the administration says former new york city mayor rudy giuliani will "share his expertise and insight on cyber security." speaking of bloomberg last week, giuliani emphasized the u.s. needs to step up on this issue. >> this fear about the russians and the chinese, all it does is underscore the fact that we have fallen way behind in cyber defense. caroline: coming up, we will

focus on mobile security with the ceo who specializes in keeping your most sensitive data from prying eyes. this is bloomberg. ♪

caroline: cyber attacks on mobile devices, especially smartphones, have become too common. anchorfree is one company trying to protect your online security. the silicon valley startup produces the hotspot shield, a map that protects users from identity theft and unwanted tracking and has been downloaded 500 million times. the company rose to fame during the arab spring in 2011 when protesters used the platform to gain access to sites like google and facebook without the prying eyes of the government. joining us now is anchorfree's ceo. david, thank you very much for joining us today. 500 million is an awful lot. how quickly are we seeing this escalation?

what is driving this growth? >> we've seen a number of global events around the world drive the growth of our app. especially today in the u.s., after the u.s. election, we are seeing double-digit growth of users that are basically concerned about their security and privacy online. we are hearing a lot about hacking, hearing a lot about different organizations, governments, malware hackers, all kinds of identity theft. and threats that people are becoming really, really concerned about. so, today, we reached 500 we'ren installs, and setting a new goal. and our new goal is to reach one billion people in the next two years. caroline: where will that growth come from? initially it was perhaps less oppressive regimes where you really saw this take off, the arab spring and middle east in a hong kong protest, but now will the growth be driven by developed nations that perhaps people are more worried about

their data? >> i think in part it will be driven by developed countries. we are seeing the u.s. as one of our top countries today. in fact, it you look on the iphone app store, we are the number 26 most popular application today. just for comparison, facebook is number 9. twitter is number 21 in the u.s. we are number 26. massive growth. it really started to escalate after the election and continues to grow very quickly. i do think developed countries will be a growth area, but i also think developing countries will continue to grow as well, because we are going to see a major trend of 5 billion users coming online in developed countries from smart phones. and they will need security and privacy and need internet freedom. those are the keys to our business and our mission. caroline: without speaking out entirely, give us a sense of how this technology works. >> it is incredibly simple. you download it onto your phone or computer or tablet. you click one button, connect,

and it runs in the background, and every mobile app, every website, every email you send will go through our secure beur servers, will encrypted, and your identity will be private. and what we see is we see a lot of users may not care about privacy all the time. but we see all users care about privacy 20 to 30% of the time, and that is when it comes to things like health, wealth, family. there are a lot of things that people simply want to protect. and there's a saying, we have nothing to hide, but i always say we have nothing to hide, but we have a lot to protect. caroline: 1 billion is the aim by 2018. how do you support that across their servers? will there be a lot of investment needed? >> you know, it is an interesting question. we have massive growth, just organically users downloading it from the google app store, or from our website.

we also have opened up hotspot for applications. that want to add security, privacy and internet freedom to their suite or to the core of their products. they are integrating rsdk. we want to be a platform that powers applications. caroline: can you name companies? >> i do not know we want to name companies, but i can name a couple of sectors. one is the security sector. anti virus applications are incredibly interested in protecting users' identity and data. they don't. today they protect the phone or the computer. the actual device. anchorfree protects everything that happens online. so, a lot of the anti virus are -- antivirus applications integrating our technology into the guts of their apps to protect users on public wi-fi, at a starbucks or an airport. the other sector are social media and news applications that are frequently blocked in parts of the world, in china or the middle east or turkey.

we saw, for example, whatsapp, when they got blocked and brazil, we saw 5 million users in one day download hotspot shield to get onto what'sapp. in a similar way, we saw twitter get blocked in turkey during the recent coup, and we saw more than 2 million people in the first two hours download just to get onto twitter. caroline: it is a fascinating growth story. we wish you well. come back when you are on your way to reaching that one billion mark. yeah, it is sort of a sad state of affairs that we have to be so worried, but at least we can be downloading such apps when we need. >> it is interesting that of the three companies so far that at reached one billion users, have all been in the business of selling your data. google, facebook and yahoo! i think the next wave of companies that will reach one billion will be in the business of protecting your data. caroline: fascinating point to leave it on. thank you very much. of course, the ceo of anchorfree joining us live. that does it for this edition of "bloomberg technology." we have a great lineup of guests on friday's show.

former cia director and defense secretary leon panetta will join us. ♪

anna: three fed president say the central bank should start discussingsing how to unwind emergency era measures. says the u.s. economy faces no serious short-term obstacles. manus: china's central bank has asked some banks to stop processing cross-border payments. anna: the u.s. is accused cheating laws. shares have plunged in the u.s. yesterday.