♪ >> i am caroline hyde, this is the best of bloomberg technology, where we bring you our top interviews from this week in tech. the resistance continues. 120 tech companies take a stand. it could become ground zero in the fight against president trump's travel ban. plus, share the twitter plunge this week as the u.s. user base remains flat. all those details ahead. intel places a $7 billion chip. we look at why the presidential bet on arizona is perhaps not as

fresh as it may seem. but first, to our lead. the epicenter for the international debate of president donald trump's immigration policy is right here in san francisco. the case took on increased importance this week for 120 companies, including the biggest tech companies from apple, facebook, to google, with a legal brief debating it. the most outspoken critics of president trump's order on immigration. perhaps because many companies know that tech would not exist without immigrants. ♪ caroline: my colleague cory johnson caught up. she is the founder of the start up of the latin america operations, and former advisor ♪ caroline: my colleague cory

johnson caught up. she is the founder of the start up of the latin america operations, and former advisor to twitter.

>> i think if you look at the history of some of those things in the companies we saw a, there is a lot of the data, historically. even today in silicon valley, many of the highly skilled workers here are immigrants. when you step back and look at our labor force, the source of innovation, it has been bred by openness, and open immigration policy that lets the best and brightest minds flow easily into this country. cory: the notion of non-comprehensive immigration reform, these will keep the people across the border illegally out, the people donald trump has spoken about, people that are going to do good things, and let's keep the other ones out. >> it is easy to say that in theory, but in practice, these are very broad brush strokes.

there is very little data to suggest that u.s. terrorism has been done by the countries whose people are being kept out. if you are to say innovation is taken -- cory: the 9/11 bombers were from other countries like saudi arabia. >> and there are people actually born in the united states of that are homegrown terrorists. if you look to solving terrorism on the one hand, and a broad brush swathe that says we have to block these seven countries, it is ludicrous to suggest that keeping these countries out will somehow keep america safe. the converse is not true. when you create broad policies that keep out innovation, often accepting the brightest and smartest people in the world are

willing to come and build companies here, and the entire united states economy will prosper. very little data suggest the people here are responsible for the recent acts of terrorism we see. cory: one has been saying we should staple a green card to every single degree coming out of stanford because we want those companies here, not going back to china or everywhere else they come from. >> absolutely. one of the ironies, donald trump about being pro-business and making america great again. but you have to have great companies started here, not in india, not in china, not in canada. if you want to have a great and robust u.s. economy, it starts with offering innovation here. and that means having an open immigration policy. cory: in practice, the visa program -- abuse is too strong, but there have been certain companies, some people have complained a cannot go around and find other jobs. that their ability to live in this country is stapled to their id card. i wonder if you look at that as

a program as necessary, or needs reform. >> it is absolutely necessary come i happen to be one of those immigrants that started my company based on the fact i got here and converted to an eb1 that allowed me to leave the company and go start my own company. companies large and small. mine is much, much smaller than google and benefits. h-1b does not go disproportionately to the other companies, and allows you to find a way here. caroline: as an open critic of the trump administration, aol has voiced disapproval. this week on bloomberg tv he discussed some of the changes we need to see here within the u.s., regardless of any change in policy. take a listen. >> one of the reason president trump won is because many feel left behind. they are not seeing the benefits

of innovation or job creation. that is the reason why that is the case. last year, 85% of the venture capital went to the state that clinton won. only 15% went to the states that trump won. california alone got 50% of the venture capital. what is happening is they are funding disruptive companies in silicon valley that are creating new technology that disrupts and destroys jobs in the middle of the country, but we are not backing entrepreneurs to create companies and the jobs in pennsylvania, ohio, michigan. this has to change. we need more capital flowing, more entrepreneurs in more places, with a more level playing field. so everyone, everywhere has a shot at the american dream. caroline: that was the aol cofounder. our next guest says the ban will be fantastic news for china and other u.s. tech competitors.

we are joined by david kirkpatrick. why is it fantastic? >> it is tim cook's job, and all the other people to hire the best people, no matter where they are from. if they cannot get this people to come in in and work in cupertino, -- the visas take a long time. apple has had people sit in other places like japan, waiting for visas. they sit there and work away and do what they're supposed to do before they can get to cupertino and work here. if the u.s. government stops more and more people from coming in, at some point, leaders in the u.s. community will say, let's put more people overseas where we do not face that problem? one of those places will be

china, absolutely sure of it. apple has already set up around the world. it will be a problem, they cannot plan for when they can get into the u.s. and work here. they will say, let's put them somewhere else and work here. it is bad for that u.s.. other places will learn from these people hired and employed by u.s. companies, they will learn from them and work alongside them. but they can take that knowledge to other companies in china or japan, which is not good for the u.s.. caroline: david, are you hearing from the companies we talked to, the leaders, that they are thinking of expanding microsoft, the canadian centers? you expecting some talent to remain abroad? >> it is early for that kind of radical move, but i think tim is expressing a legitimate set of concerns about what could happen to the tech industry if these immigration attitudes continue to get more and more restricted. that is what it is about.

companies, tech companies in particular, benefit tremendously from more open immigration. there is an article today in the new york times about the entire economy's growth would be dramatically increased if we had more immigration broadly. immigration and migration is generally believed by economists to be an unmitigated positive for economic growth. caroline: still ahead, despite president trump being a big fan, twitter finds itself stuck in neutral. user growth also missing more. ♪ caroline: plus, a 30 year nasa veteran leaving the agency for silicon valley. uber and flying taxis. ♪

caroline: twitter says it is getting tough on harassment in their latest update. the social network wants to hide abusive content and create bad users from creating new accounts. they are trying to clean up twitter. not enough has been done to curb abuse and harassment. and speaking of twitter, shares tumble this week after the profit outlook missed analyst estimates. they are having trouble learning users and advertisers, only 2 million active users. this deceleration in user growth is causing advertising sales to flag. keep in mind, as represent 90% of their revenue. president trump's frequent tweets in the lead up to the 2016 election, trumps impact our

knowledge. >> we cannot quantify any impact but we will continue to analyze this as a go through quarter one and talk to at the end. caroline: we spoke to cory johnson and an analyst for more. >> daily actors are improving and they are getting better engagement from those users on their platform. but at the end of the day, twitter needs to decide what it is and what it isn't, they are trying to continue this growth story but it is not happening. when you go through the biggest world events, which donald in the trump administration are utilizing as a primary communication tool to the world, and still not seeing any improvements in the conversion rates. they are getting at least 2 million new visitors coming to their site every single day, and

some capacity. and they're not able to convert those users. ultimately, the rocky road ahead is about to get even rockier. caroline: even rockier, cory. dig into the key issues you are seeing here. some dilution happening, in terms of shares. cory: in the midst of this inability to grow leaders and revenue, they are giving a lot of stock options out. it is different, their earnings per-share point, because they give away so many stock options. it is that massive levels, a company that ipo'd -- it continues to have a massive stock compensation expense. if it were not for all the stock conversation, the company would be profitable. there is a valid argument, it is a non-cash expense, that they do not have to spend to get these options. but there are so many shares in the market.

the insiders of the company are getting more and more shares with every knock down in price. but the result is, it is flooding the market with shares, even as investors are holding back. caroline: james, is that making investors bristle? james: of course, and you see all the tech peers moving away from non-gap measures toward gap reporting bases. that is something to scrutinize, especially when you consider 20% of their expenses or revenue is an stock-based compensation. it is something that involves more scrutiny. cory: let me back up. when a company has an ipo you expect to see a lot of stock in the initial income statement. but it should drop off after the ipo because what is shared before the ipo is no longer an

expense. but they are still issuing shares. james: they are issuing shares, nobody is putting their money where their mouth is. there seems to be so much confidence in the metrics they are reporting. and the belief that this turnaround in use is going to drive a bigger turnaround for the company. i do not know where that confidence is coming from. it would be good for them to put their money where their mouth is and buy back stocks. jack dorsey said i believe in it today, i will buy my shares today. we are not seeing that. there is a lot of rhetoric, the shares are not matching. what they need to do, look in the mirror, who do we want to serve, and how do we do it? caroline: james, one way they hint they are doing it is by video.

they're going to have live video, can they manage to get that target of profitability by this year? james: video is a double-edged thing. i am so exhausted from giving the benefit of the doubt to the benefit of the doubt to twitter. you have to think about it this way, every incremental dollar you get from video has a higher cost associated because you need content. if they move into more and more premium categories, they could change from the one people believed in at the time of the ipo. at the same time, who else is going after video? facebook, snapchat, youtube, and twitter, with their 390 million users -- good luck. one point on this, the 600 hours

of video they added in the fourth quarter, only 31 million users, viewers, watch to that content. come on. caroline: we here at "bloomberg technology," explore the dynamic between twitter and the twitter president. what are they telling us since the u.s. election? >> president donald trump's use of twitter is unprecedented for a world leader. consider his audience. the president's personal account has roughly 24 million followers. compare that to his neighboring leaders, like mexican president enrique pena nieto and justin trudeau. barack obama's has four times as many followers, but only half as many tweets. he speaks frankly and directly to people, and twitter provides the ideal that form. he tweeted more than 240 times since inauguration day, directing the news flow in 240

characters or less. sometimes to discuss foreign affairs, and sometimes none of the above. but we do not know if the attention the president has brought to twitter over the last few months is attracting new users. they have reported twitter's mobile app users sell more than 6% since november, to 45 million users. our context, snapchat has 82 million in the same month, facebook, twice that. trumps use on twitter has not helped investor sentiment. it is flat since election day. and on the days trump tweet something engaging, twitter is not rewarded with a bump in

stock price. his most popular tweet was this one from sunday, january 22. liked by nearly 400,000 users and retweeted 82,000 times. but when trading resumed the next day, the shares closed nearly flat. research downgraded twitter, citing, muted growth among the average users. if twitter the company is not benefiting from superuser president trump, who is? perhaps democracy? caroline: still ahead, kluber is researching flying taxis. we meet the man who literally wrote the book on flying cars. and, we meet the makers. the 2017 makers conference and catch up with aol ceo tim armstrong. ♪

caroline: tired of that morning commute? uber may have a solution in the works, they have hired mark moore from nasa, engineering and aviation. they want to develop flying cars. cory johnson sat down with brad stone for more details. >> if you're a science fiction fan, the idea of a flying car or aircraft that takes off and land s vertically, runs on electric power, is automated, is cool. a little background, seven years ago a guy named mark moore at nasa wrote a paper, from langley. he started talking to larry page and they spawned two companies. we wrote about these companies, they have been very secretive. cory: kitty hawk. >> a noted name, from the wright

brothers. uber wrote a paper, saying they wanted to play a role in the ecosystem of these cars. they do not want to build a flying car just yet, but they thought they had a role to play in suppliers, battery technology. they recently hired that guy from langley, mark moore, who wrote the paper in 2010. adding firepower, this is very real. silicon valley is working on it. he will be soaring through the air is to your job, not soon, but one day. cory: or not. >> or not. cory: it is interesting, uber is a company that could have been all cloud. a company that really takes advantages of, people do the hard work, they are where the cash is transacted. they are

doing things they easily could have left to others. i wonder what it is with the mentality of this company that is all about leverage and services on the backend, consumer phones on the front end. but still seeing money in the development of cars. >> there are two coup explanations, the cynical one, they worry this will happen without them. they google would develop a driverless car or zee.aero or boeing would develop it, so uber wants to be involved in some way, or they are left behind. on the other hand, it is the same reason amazon developed the kindle, if you want to see a future, you have to be involved in advocating for it. cory: a sect up all that ai and robotics engineers, and they are cherry picking academia. >> it is funny, google got a lot

of criticism for doing these things. one by one they have been spitting them out. the driverless car division is very central to google's plans. the flying car projects they did outside the company. cooper is offering capability in-house. caroline: that was cory johnson and bloomberg technology's brad stone. be sure to check out brad's new book "the upstarts: how uber, book "the upstarts: how uber, airbnb, and the killer companies of the new silicon valley are changing the world." grand ambitions with president trump. we will have the details, next. and if you like bloomberg news, check us out on the radio. you can listen on the bloomberg radio app, online, and sirius

xm. ♪

caroline: welcome back to the best of bloomberg technology, i am caroline hyde. intel said it will spend $7 billion on a production facility in arizona. the announcement came during a meeting with president trump at the white house. they expand intel's presence in arizona and would create 3000 jobs. it was already included in their capital spending forecast. and the construction was already started. so why the announcement now? bloomberg editor at large cory johnson caught up and asked why they focused on building in the u.s. cory: just to put us in perspective, we tend to be 1, 2, 3 in the world in terms of our capital spending.

1, 2, 3 in terms of our research and development every year. the majority of the investment is in the u.s. we do invest all over the world, but the majority is in the u.s. first and foremost, we can hire great people here. we have really good infrastructure, and access to worldwide markets. 80% of our sales are outside the u.s.. that is really important to us. we do all that against, u.s. has the highest tax rate in the world. we are disadvantaged, relative to our competitors in korea or taiwan. at that is a place where we are working closely with the administration to try to get a

more pro-investment policy that makes more sense for us to continue to make these investments here. cory: is a billion dollars the price tag for intel these days? >> we are starting with a shell that has been built. we have some work to do on the shell, and then to outfitted and get it into full production is another $7 billion. we were starting from a piece of land. in excess of $10 billion to build one of these factories. cory: i visited open hills a few years ago, it is jaw-dropping. you have the shell, but if you started with vacant land, how long would it take? >> from start to finish, depending on where you are, whether you have a shell or not, it is three to four years. to put it in perspective, in addition to the direct employment we are creating for intel, these are among the largest construction projects on the planet. we will still have 3000

construction employees getting this thing ready for production. they are just enormous. and the impact they have on communities is enormous. cory: what strikes me is the irony. you have intel, the refugee and founder of intel. at the same time, the federal district court in san francisco is debating this immigration ban. and brian your ceo at the white house with donald trump. i wonder, how much does intel need immigrant labor and labor from refugees around the world? how important is that to intel, historically? >> it is very important for a to be able to hire the best talent from all around the world. we are solving the most complex problems on the planet. to put this in perspective, intel is not political. we engage with democratic

administrations, republican administrations. depending on the issue, some areas we agree. we are in agreement with what they are trying to do around the tax and investment policy. other places we disagree. issues of immigration and being able to hire the best talent. we made that clear to the administration, as well. we engage on issues, not necessarily down political lines. we want to invest, hire the best talent, built in the u.s. and around the world, and make the investments that make us a great company. cory: talking about intel's use of h-1b and how important it is to you, could it be simpler than in the past? stacy: yes, it comes back to the simple concept, we need to be able to hire the best talent in the world. you have phd's, people that come in from overseas they get phd's in math and science areas.

those of the people that come in and make intel a great company. what we would like to see in h-1b space, a higher proportion of those visas being used for the most high skilled technical people. i know they have been engaging with administration to make our point of view known. caroline: david kirkpatrick and our editor at large, cory johnson. a story we are following, apple has, yet again, sold used iphones in india. they negotiate with the government over concessions to start production in the company. it was met with resistance as government ministries believe it could undermine in india program in local manufacturing. apple is exerting its influence on the negotiating table. coming up, we will sit down with

aol ceo tim armstrong from the makers conference and talk about how women make up 50% of aol's leadership by 2020. all episodes of bloomberg technology are live streaming on twitter. check us out weekdays at 5:00 p.m. in new york, 2:00 p.m. in san francisco. ♪

caroline: a revolving door in tech -- zenefits ceo, the third of the embattled hr startup since 2016. david sacks announced in september he will be stepping down from his role as chief executive, less than a year after taking over zenefits zenefits' cofounder. the new ceo announced job cuts to reduce costs in the wake of scrutiny and management shakeups. this week we go to the makers conference. a well ceo tim armstrong

announced a goal to have women represent 50% of the organization leadership by 2020. he is targeting equal pay in the same timeframe. aol joins a push by corporate america to make it the top ranks reflect the population. tim: this journey started six years ago when we cofounded with dyllan mcgee. we wanted to not just be an investor on the media side of makers, the largest catalog online of women's leadership stories. we wanted to lead as a company in the space. we have been meeting with our executives, up-and-coming women executives, and the one thing we could do as a company that would send a message and be the company also, they said, could we get to 50-50 gender diversity at the top of the company? we discussed it and made a commitment to it.

we are in the process, we started a couple months ago, we are getting the company reestablished, recruiting internal development, so by 2020 we want to be 50-50 across the board with the top management of the company. it is a bold goal, but we will figure out how to do it. caroline: and equal pay by 2020. if you are an entrepreneur, a business leader, what are the step-by-step approaches to achieve that? tim: we have diagnosed the issues we have around it, one starts outside the company with what i would call pools, different talent pools. we have to reconnect our recruiting efforts into broader pools. if i went to a company said, we want to be 50-50 by 2020 and i said, let's go faster, we have to change what we are doing.

we're rewiring the polls. and you go into an interview, we have to represent what you think the company is in the space and what you will be doing. if you are a female executive coming in, part of the interview process should be your meeting with female executive and getting that side of the story from us in terms of why you would want to come. and, the internal employee development process. if you are diverse talent, a female executive and you want to move your career along in general, we have to but the fundamental steps in place, which we have been doing. our plan of the next two or three years is to put it in place, just like we did with the huffington post. we will do a deal around this issue. we are serious about it, just like any other startup issue we deal with, we will figure out how to do it. our employees are very engaged and excited.

caroline: talk to me about the yahoo! deal. how optimistic or frustrated are you by the timeline that has passed? tim: let me start with the yahoo! brand and talents. yahoo! remains a brand we care about. many people care about it in the world. the talents, we have had a great experience with them and the integration process over the last six months. it is on track. they had data breaches. the real situation, we are waiting for information to come back from yahoo!. caroline: the timeline? tim: it is ongoing, i would not want to give a timeline. i assume it in quarter one we will have more information. after that, we can sit down and discuss with them in a coherent way the next steps in terms of what the outcome should be. it is too early to have that discussion. i think we have a high appreciation for yahoo!. we need to see if there have been value changes based on

breaches. caroline: the driver for yahoo! is more web users to be a powerhouse. you look at mobile advertising, facebook and google dominate the space. how can you be the number three? tim: we bring something unique to the table. facebook and google are the gold medal athletes, they perform well, they are executing well. you look at their numbers, they are doing a great job. the space we want to be an olympic athlete and gold medalist in the brand space, the same way google cares about search and facebook cares about social, we care about brand. as you noticed on social networks of fake news and things like that, and the search space where people have been going to more ai then user-directed, brands become a really important role. we want to be partners with content brands and have an advertising system that helps find new consumers and push them all the way through to

conversion. if i said, facebook is a social, google is search, we will be brand, everything we are doing of the company is around brand. and we're excited about the future of advertising and brand for digital. we are one of two or three companies do enough. caroline: that was aol ceo tim armstrong. at the makers conference we caught up with a former u.s. chief technology officer, megan smith. we asked her about president trump's proposed to be the restriction and what it means to learn in talent to the united states. >> we need to keep the pressure on and make sure our talent is assured at all times. it is critically important. really, our opportunity is here. it is time we did the artificial intelligence work. it is becoming a time of automation. 35 coal miners just graduated -- what are we doing to get americans the kind of talent?

nine out of 10 parents want coding taught at school. let's get it done. also, let's continue to watch the talents. pay attention in a smart way to how we are doing this. homeland security has a tremendous program, where we review. if they are really capable agencies, we need to continue to advance the field, not ban people. caroline: also switching to executive orders on visas. a lot of concerns have been raised about how they are deployed. are they used in the right way? are there other ways to bring top talent to the united states?

>> we are working on a modernized entrepreneur visa. you see it in canada and other places, we want to have companies and jobs here. the department of labor, which we could call talent, they did a great job, $135 million of the fees from the visas were used for grantmaking. in albuquerque, a represents four counties in new mexico. a goes straight into the tech sector. to go from $10 an hour, to $60,000 a year, $80,000 a year, in three months, these regions are growing. we are making the system work for employers, people that have stereotypes, i do not do that --

yes, you do. it really drives our economy and economic transformation. caroline: that is former chief technology officer, megan smith. facebook also made announcements at the conference. a company is expanding paid leave for its employees facing family hardship. sheryl sandberg spoke about why. >> this is personal for me. i lost my husband almost two years ago. facebook provided me, i was able to take the flexibility i needed, and now we are doing even more. caroline: the new bereavement policy will allow up to 20 days in the case of immediate family members death, and up to 10 days for extended family. coming up, why are firms waiting to hire female investors? from the makers conference, next. ♪

caroline: a story we are watching, pinterest unveiled lens technology. it will identify objects in the picture and content within the app. the company also announced other features to help users find more products related to images they have saved. back to palos verdes, california to the makers conference. the message, be bold. before launching bbg ventures, she was a ceo of another group. take a listen. susan: the good news, women are starting companies at extraordinary rates. we have seen 1400 companies with a female founders since we started to an half years ago. that is not all of them, right. this is a very fertile arena. the problem, the legacy world does not have the networks their reach into this female

entrepreneur base. so women are still getting only about 10% of the venture capital that goes to startups in this country. we looked at that and said, that is an opportunity. if women are the dominant consumers, and there are more and more women coming out not just of engineering schools, and companies where they have real vertical expertise, we should be backing the best of these because they understand that.

caroline: what would be the tipping point to start seeing this talent come into their own hemisphere? the data already proves if you are an s&p 500 company, when they are female-led, what is the data not showing? susan: i think it is less about what the data shows, because a lot of these companies are still in the early stages. it takes five years, eight years, 10 years, for companies to really show what it can become. but, i think what you are seeing is that there is at least a recognition that they need to open up their partnerships. several of the most storied vc's, one brought in their first female partner. caroline: just now? why so long? susan: it has been a world where -- it is understandable on a certain level. most of the early startups were selling to large technology companies. they were enterprise plays.

to be able to talk to the guys working at those companies was important. but as the world changes and as technology becomes a part of every company, there is just a bigger world out there and a bigger opportunity. caroline: what we have seen a lot in silicon valley is that he startups have been led by immigrants, as well. susan: yes. caroline: how do you see the trump travel ban coming into play and how does it affect female immigrants? how much of your pool of talent comes from outside the united states? susan: we only invest in companies that are u.s.-based. but there are certainly plenty of founders that have come to this country to go to university. they are starting companies now. there is no question that this particular sector, startup world, technology startups would be impacted dramatically.

caroline: you spoke a lot throughout the election cycle that perhaps, voiced by many within a social media, do you see social media attack this problem and become accountable? susan: everyone, whether they wanted to take responsibility for the outcome of the election or not, i know for a fact, every company really looked hard at what their current policies were, how they can make sure the echo chambers were opened up, if that was a problem. and all of them have gone after the fake news problem, as well. i think that there is, nobody is being cavalier about this. it is a problem that everybody recognizes.

and i think they are all doing a pretty good job of trying to find solutions for it. caroline: at the makers conference we can hear music and shouting behind us, what than 500 women. it is about leadership and stories. it feels optimistic. are you optimistic about the talent pool coming through, and policies adopted in the u.s.? susan: i am optimistic about a lot of things. i am very optimistic about this conference. everyone talked about it coming in as the meeting after the march. and if you were in d.c. or other cities, it was such a spectacular day. it was one of those days that remind you of how much progress has been made, and, what a unified group women in the united states are. and actually, women around the world right now. and the message was very simple.

we are not going back. i think what an event like this is going for, is to get people thinking about what that means in practice. what are the things we need to do going forward to make sure that our daughters have even more opportunities. and certainly, in this area of entrepreneurship where you can create your him company, that is key. it is an arena that we need more women in. women are natural problem solvers. see you take any consumer problem out there and there is a woman, i promise you, who is working on a solution for it. being able to find ways to have more women understand how to use technology in order to solve problems, and getting more vc's, more investors supporting this next generation of women to do that, is great.

caroline: that was bbg's ventures president, susan lyne. and oh, snap, comes to mind in a mistaken identity. a little-known startup. they filed for a $3 billion public offering. the mobile dating app volume started to rise in january. that does it for this edition of the best of bloomberg technology. we will bring you the latest in tech throughout the week on thursday. we will hear from the cisco ceo chuck robbins. tune in each day, 5:00 new york, 2:00 san francisco, 6:00 a.m. in hong kong. all episodes are live streaming

on twitter, check us out weekdays. this is bloomberg. ♪ david: what propelled you to

pick google as the company you wanted to go to? who cares about a search engine? eric: i did not particularly think google was going to be that accessible. david: is it awkward when you are the ceo dealing with founders? eric: our dress code, you have to wear something. david: it seems as if the driverless car phenomenon is on its way. you have been in one of these cars, and you feel safe? eric: we are doing this to save lives. the 32,000 people are scheduled to die this year. david: europeans do not seem to like google as much as americans do. have you resolved those issues with europe? >> would you fix your tie, please. david: people would not recognize me if my tie was fixed. let's leave it this way. all right.