♪ cory: i am cory johnson. this is the "best of bloomberg technology." nine months after the historic vote, brexit is underway. discuss what it means to che $25 billion finteh industry. we talk about the debut of the samsung s8.

first, it is official, the united kingdom triggers article 50. eu leaders seek an orderly withdrawal. on thed have a huge pack economy and cause ripple affects a cross the globe. h industry has been growing rapidly, $25 billion. we spoke with the u.s. general manager at a u.k.-based peer-to-peer money transfer business. >> it has been an interesting tech.in fiin we are a platform for moving money between countries, so our customers live international

lives across borders, so the -- it was in the company, a lot of staff have come to london or other offices around the world and the problemh they solve, expensive bank transfers. peoplef our staff are who are internationals. off with to kick it the senior fellow at the brookings institute in washington dc. extensivelytten on brexit and the adverse impacts. london had positioned itself , abe a global fintech leader rare city that included finance and technology.

that into thrown uncertainty about what will happen in terms of london's position as a global financial leader and your basic ability to do business on the continent of europe. the globalhead in race on fintech and now the rest of the world will catch up. >> it will be interesting to see how much that puts them behind. have big thing that companies have been worried about is the passporting policy to sell their services elsewhere in the eu. how damaging is this policy change going to be to fintech companies? will be damaging if you don't have the ability to go into europe. furthermore, the uncertainty about what will be in

passporting will drive investment choices today. , whyu were new fintech would you go to london? it is a double whammy about what will happen and the uncertainty between now and then. guys preparing for this potential loss of passporting rights? >> london is one of the few cities in the world that has finance and tech. happen initions don't many other cities, and it takes a lot to build a fintech hub. new york is one of the few cities with talent in finance and tech. we will have to see how it pans out. the other thing is the rights of eu nationals living in the u.k.

the timeline will be long. one thing that is important think about is how fast fintech companies move it, and how slow policy moves. so it is a different time frame and we are thinking about different scenarios, but for us and the wider u.k., it is business as usual. >> there is much still to be determined, but are you looking to get regulated in another eu city to hedge? our expansion comes being regulated in the new country. that is one of the fundamental assets. we are building our own network as wemany countries can, so it is part of our normal modus operandi.

it is something we have to do, not something we worry about. come to america. our remittance system of international money system is slow, costly, and we could use innovation to make people's lives better, and fintech offers that. i welcome you with open arms to solve these problems in the u.s. >> that is great to hear. our customers here have process to $2 billion through the u.s., and it is great to hear you validate that the country needs us. and athat was a joe cross senior fellow at the brookings institute. less than 5% of square sales are in canada.

phone, goodflagship samsung's exploding phone reputation finally be behind it? we will discuss. all episodes are live streaming on twitter at @bloombergtechtv weekdays at 5:00 on the east coast, 2:00 on the west coast. this is bloomberg. ♪

to movemsung is trying on from a pr nightmare. the company showed off its with-new flagship phone the emphasis on cool features rather than bodily harm. ♪ newamsung has unveiled its flagship android smartphone called the samsung s8, and the company knows it has got to get this one right because samsung's last major launch into it

in disaster. users showed the phone capable of overheating and catching fire. issues with faulty batteries, and after two rounds of global recalls, the note 7 crisis cost the company more than $6 billion. it may have also cost samsung its lead in the global smart phone market. samsung had beat apple every quarter before that since the end of 2014, which brings us to samsung's comeback attempt. .t comes in two sizes the logo has been removed from the front of the phone to make more space to use the screen. encryptedes with and andecognition

equipment to apple's siri. there is still the question, is it safe? >> at samsung, safety has always been our priority. >> the company has been touting a new eight point battery check. investors feel confident with samsung trading near a record high. samsung faces a test when apple rolls out the 10th anniversary version of the iphone. is this the product that turns around samsung's fortunes? we caught up with someone who does research on wearables and mobile phone markets. the phone is an important step to turning this around, but we should not look at the phone by itself. it is an elegant device, but you look at what samsung has done, a

thorough investigation, ,xtremely transparent process and an eight point process in soms of quality control, when you put that together, i have to think samsung is feeling confident they solve the problem and have addressed the issue. even today, they've referenced what happened and underscored quality and safety without having to rehash the whole thing again. outar as this device coming after the battery debacle, it is a strong first step. >> ramon called this phone beautiful and elegant with a smattering of additional features. what has the consumer reaction been like so far? >> it is beautiful and samsung made a good move delaying the introduction. it helps to underscore how seriously they take the process

of getting it right before they release it. i think people will love this phone. will it turn around the company's fortune? that is another matter. the company has a lot of challenges facing it, and they have a bigger challenge -- you mentioned alexa earlier, but the fact is the smartphone era is kind of ending and we don't know what is coming next, but that could be more important in the long term. in the short term, this phone will probably sell well. >> samsung's market share fell below 20% of the first time in four years. they obviously have competition from apple on the high end, but up and comers, so what is the main source of pressure causing this drop in market share? >> if you look at where samsung is competing, it has its

position in the high-end of the market. tiers go further down the into the midrange, then that low , $150or entry-level range and below, that is a dangerous part of the market to play for samsung, even if they can get scale because it becomes a contest for how low you can price your smartphone. a number of smaller and regional companies are competing in asia are willing to lose money in favor of gaining market share, and that is a dangerous market to play in when the market itself is growing in single digit territory, so as far as the s8 is concerned, this will cemented hisamsung position on the high end. >> these are going to be quite

pricey. iphone will behe the main competition until they come up with the new phone. is your initial reaction on how this may stack up to what is coming for apple? david: one of the things that matters is china, and not just because china has several competitors, but because the market is so fast. vast. it is a country which is increasingly putting a special preference on local champions, huawei and oppo are two. this will keep the competition with apple relatively stable. the real question is how great is the next iphone, and we don't great -- but if it is

apple still has a better brand than samsung by a long shot. it still commands the hay low of the top of the market, and i don't see that changing. coming up, tesla got a vote of confidence from tencent. we will look at what it means for the model three launch next. an, elon musk has unfathomable road ahead to get these cars to market. this is bloomberg. ♪

cory: this week revealed that tencent bought a 5% stake in tesla at $1.8 billion, the first step in a larger partnership in the future. and tesla have no

detailed cooperation plan at the moment. the news.k jumping on we talked to kevin carter. tencent has a process where and'd look for the best fastest growing companies and make an investment in it. large portfolio. they are charting their plan to take charge of this world of electric vehicles in the future. aidu has been investing. alibaba struck a partnership, so it does not come as a surprise. cory: these are financial investments, a place of the table. sources areips and

telling me they would not be surprised if there were partnerships. wechat is great for tesla to have their feet in. feed in. cory: $82 billion investment matters. eight $2 billion investment matters. 100 inent has made private and public companies, all internet related, and this one marks one of several investments into the automotive space. we have seen this all over the news here.

there is a change going on in the way people and products are moved around. it is very early stages and no one is sure how it will play out. i think they just want a seat at the table, a tale in the water position to see how things play out. cory: it helps them get cash out of china. a lot of money is fleeing china on an individual level. all of china's biggest companies won a seat at the table and get more capital abroad. it is unclear what the process will be like for tencent, but we see financials having trouble

with moneygram. yes, this is a big deal for chinese companies and a great way for tencent to have their stake in a fast-growing u.s. company. , some ofyou on tencent us forget that china is the largest car market in the world. , when younk tencent do the work on the company, is this a company that should be in automotive in different ways? >> they are already invested in other ways. they recently invested in the leading auto finance company, but one of the parts of the story that is important, while china is the largest car market, its per capita number of cars is still quite low versus the united states in particular, but this has not become a problem.

cities, there are restrictions on which days you can drive. we have seen of the stories of traffic jams in certain parts of more than any country to the extent the autonomous vehicle takes some of the it makes a the road, lot of sense for china as a country to be in bracing autonomous vehicles, which is what a lot of this investment is about. that was selina wang and kevin carter. tesla, elon musk has set a high bar with the launch of model three, but that is an understatement. in order to hit the targets he has set, tesla needs to build 430,000 model threes, more than all the electric cars sold anywhere last year. our next guest is bullish, but

does not believe in that production ramp. , the global head of auto research. our forecasts are more conservative than the company's forecast. we expect this vehicle goes into a soft launch mode in the fourth quarter, and our forecast is for 0, but 20000,000 comba units delivered by the end of the year. is toint of this year have those initial deliveries done, get the data and initial feedback from the community. next year, about 80,000 units. near 400,000e production. our number is. number is less than half or a third.

we are constructive on the investment story. cory: what do you think the price of the car will be? >> an average transaction price of $60,000. at $35,000.re >> we think the kind of people who will order that car won't want the $35,000 version, so while they could technically cediver that, once it is spe up, the customer will come a very few will walk out at that injury level price. cory: after the acquisition of -- thety, the impact would hitstatement the cash flow burning tesla in a bad way. we saw that in the first quarter.

how do you expect that to moderate? >> that will be up to them to prove, right? they have acquired another cash consuming operation along with a sizable balance sheet, which adds more financial leverage to the story, and a lot of investors thought we did not sign up for this. we were also on the sidelines as well as we digested it. the cash, we have consumption of that business in our medium-term forecast. we have zero value for solarcity or tesla energy in our base case. we view the company as a transportation company. cory: you have battery sales -- where is the give and take of their? was a battery business

necessary requirement for them .o achieve their volume goals they wanted to secure their own reliable supply of high-quality batteries that they could have control of their cooling system and mitigate risks of fire or other problems. whether the battery business becomes a separate business all their own, we have done some work with our electric utilities team for opportunities for stationary storage. we can come up with a few percent, but even bullish assumptions for tesla energy -- it is still a transportation company. cory: that was morgan stanley analyst adam jonas. we would hear from the eu iftice commissioner who says president trump tinkers with the privacy shield, she won't hesitate to pull it. nye joins us for what

nasa should be focus on next. this is bloomberg. ♪

cory: welcome back to the "best of bloomberg technology." i am cory johnson. with thetors concerned privacy shield. unless u.s. companies like facebook and google transfer data across the atlantic -- but since that deal has gone into effect, donald trump has expanded u.s. surveillance powers. we caught up with the eu justice minister during her visit. they is absolutely crucial

have certainty when they transfer of the private data, so for me, this is important to be and ask theington new administration and new representation of the united states whether the guarantees which we agreed upon in the negotiations of the so-called privacy shield, whether they are still in place. cory: why is it important for the businesses? >> the businesses are dependent on the transfers of private data, and without a privacy shield, they were asked to have a complicated way to guarantee the protection of data when transferring it to the nine it states, so having the privacy shield is useful and comfortable

legal arrangement, and if i say comfortable, it means they have to comply with the rules of comply withlds and the stricter rules of protection of private data, which we have in the european union compared to the united states. cory: can you tell the companies , don't worry. we will make sure this will be fine? do you have that ability? i cannot give such a guarantee to the companies because it is mainly their task to be compliant with the rules, and only through the full compliance can they avoid being sanctioned or having some negative impact on their business, but why i am here today is to have dialogue with american representation. i had the privilege to speak with mr. wilbur ross, who assured me he understands the

importance of privacy shield and the commitments under privacy shield in place for the state administration, and i have to come back to europe with such assurance and work on keeping privacy shield running. thewing us to be sure that protection of the privacy of europeans is in place. toy: are you still willing pull the privacy issue completely if you don't get the assurances you need? i spoke to mr. ross, to the american chamber of commerce and representation of various businesses, and i had a good feeling for privacy shield is fulfilling its main purpose. representatives of ngos and watchdogs which have feelingcerns about the

that there will be more emphasis on the priority of ensuring an initial security, which would protection of privacy would be secondary. i don't have such signs. cory: that is interesting. standpoint, it seems the eu has targeted american companies that seem to have a different notion of privacy, to put it politely, then some european companies. do you feel in your role as the eu commissioner that you have to focus on u.s. companies because they don't get privacy? operate in companies the european union and collect the private data of europeans. they have to comply with the same rules and the same privacy

guarantees as european companies, so we do not make any difference and we are applying the rules and the guarantees of protection to all the companies. cory: that was the eu justice commissioner vera jourova. former science guy bill nye has some free advice for donald trump. his nonpartisan space enters has issued five recommendations for the new administration. some we know trump plans to keep in place, but some other areas, trump plans dramatic cuts. us to explain why the planetary society offered advice to trump. >> previous administrations have chalked an existing program and started over. we think all the programs in work now are worthy enough to

keep in the pipeline, and then asp mars, the planet mars the focus for human spaceflight. cory: why mars? that has been an argument says singles and doubles are important. let's get data and signs and not sink so much of the budget into an expensive thing like mars. >> two different things, the trips to mars are reasonably priced, robots and rovers. what i would like to do in my lifetime is send a rover sophisticated enough, sterilized enough, to drive up to one of these so-called stripes running that it is agreed are the result of running water, and we would look around, microscope examine the ground for living

things or evidence of living things. gets peoplehat excited about space exploration is when humans go out there, so we want to get humans in orbit around mars by 2033. if you want to go earlier, all good. you can't just go any time. you have to time it with the orbits, but we strongly feel this would bring out the best in us and we would make discoveries that would change the course of human history. cory: how so? >> if we found evidence of life on another world, be it mars, or jupiter, which has twice as much seawater as the earth, if we were to find evidence of life, it would be like copernicus thinking of the planets going around the sun. they seem in tent on

cutting funding and the budget atnasa, but even looking things like climate change as suspicious or untrue. , thee problem at nasa proposal is to increase the budget, but there is a lot of talk about decreasing the earth science budget, which is a big part of what nasa does. many of the instruments aboard those satellites are designed by experts, technicians and engineers and scientists at nasa , so climate change is for some .eason a political issue from a scientific standpoint, it is just an issue, the most significant issue facing humankind, but our belief is that if we advanced space, science, and exploration at nasa, earth science will get

advanced as well, so we want to keep it all going, but with respect to being anti-science, as much as that is being talked about and as serious as it is, nasa is the best brand, just craft, a state department's point of view, nasa is the best brand the united states has, so you can invest in nasa for this reason that is not scientific. it is just helping people around the world recognize the extraordinary expertise that has been built up here in the united states and space exploration. cory: that was planetary society's ceo bill nye. up, snapchat wins over wall street. what is the real reason analysts are suddenly bullish on snap stock? later, uber in the spotlight, this time voluntarily out with its first diversity report. it seems to be a deficit.

this is bloomberg. ♪

cory: in the midst of monday's market selloff, one notable bright spot was snap. the company received nine new buys after a cool reception. analysts come from firms that received banking fees from snap. one of those analysts is giving snap the benefit of the doubt. he is head of internet research at oppenheimer. >> clearly the stock has perform well since the ipo. investors do like it. this is a very interesting company, 75% of the 18-24-year-olds using the platform, but can you get everybody else.

we have done some work that we think was insightful, but if you look at the history of tech ipos, they generally come down after that initial pop, and while there is a double gain from the share price today from a we think investors would be better off waiting for a lower price. the underwriters tend to be more bullish. you came out with some great numbers showing the average target price is higher for the underwriting firms the non-underwriting firms. >> it is interesting that since om bubble, we have this pattern where underwriter banks tend to be more bullish, 69% of irmsunderwriter f buy ratings.

cory: there are legal requirements. tell us how that works from your perspective. those firms that do participate in the deal get to talk to management, get more access. as a result, they may be able to form deeper opinions and get access to management. if you think about the way the roadshow works, the company meets with mutual funds and hedge funds, but they do not meet with the sell side firms who are not involved in the deal, so the firms who initiate not involved in the deal have less opportunity to learn about the company. cory: what is it like to sit in your chair and deal with those chinese wall rules? >> the rules are the rules. the company allows you to ask

questions. third partyn research, go to the company and ask them to clarify things. some things they can tell you, and some things they can't. partners in mye firm refused to meet with management. he did not want to have that influence. aat you are describing something we have seen a long history of. when you looked through the notes, did you see some thoughtful analysis? >> the interesting thing about snapchat is that tend different people can come up with 10 different conclusions. you are talking about a company that is interesting, created a new way for young people to communicate, and it has become addictive for that set of people. the big issue though is this is

a company with a scant record of monetization. margins, ative gross business model that we have not seen before, so i don't fault r having a dirgen' and view looking at the same set of facts. extrapolating/are growth in their ability to generate ad revenue per user or in their ability to go from teenagers and young adults to a mature audience. the apiu reported opening up could accelerated. >> this is the way you by automatically. the majority of the campaign bespoke.pchat was th an api allows you to make an ad and the computer decides who

your target and when you run. launched its api in 2011, but it accelerated the growth from 20% to 80%. their api,r launched they saw the benefit one quarter later. cory: china is attempting to clean up the reputation of cold. we will get the latest from the largest coal producer next. if you like us, check us out on bloomberg radio. in the u.s., on sirius xm station 119. check us out. this is bloomberg. ♪

cory: one company that cannot stay out of the spotlight, uber. uber's says it will pull out of denmark by april 18, a new taxi

law requires a fair meter and seat sensors. driverss more than 2000 in denmark. a spokes person for the company said it will provide dedicated resources to help drivers throughout the shutdown process. the company released its first report detailing the gender breakdown and racial makeup of employees, showing the ride hailing company trails the industry. of thenly represent 22% leadership team and 15% of technical jobs. talked with ellen huet about what was missing from the report. other reportske we have seen out of the big tech companies in the valley. these companies show a similar pattern, which is few women and non-asian people of color in

engineering and across the whole and especially in leadership. because they include in their total employee counts, they did have a better racial diversit y than other companies we have seen. cory: i suppose this does not include the drivers? >> it does not. the drivers remain independent contractors. there were plenty of people on twitter who were confused about that. want to given't them benefits and worker rights. insurance, worker's comp., all these things they do not want to include. it has been a long legal battle. cory: that is not the only diversity issue with uber. former employees

say she was discriminated against because of her gender while working at uber. is the jumping off point for a different story i wrote this afternoon that talks about the way these diversity reports do not include retention rates. they are happy to talk about demographics and hiring, but they don't talk about who's days. when you talk to people who study management and diversity, exitsay retention and who and whether you see some demographic groups leaving more frequently than others is an indicator of what the culture is like in the company. it is a metric people don't like to talk about. she talks about how she tried to track the rates of her own department herself because she knew the company would not talk about it, and she was interested in seeing who is leaving this particular engineering department and says the reasons

women were leaving was because it was organizationally very chaotic, and a lot of sexism. cory: she also suggested in a perverse way a diversity initiative at uber caused her to be forced out of the company. >> it is interesting what she says. she applied for a transfer within teams and that it was locked and she did not get good answers from hr on why that happened and said she overheard her manager boasting about how he was able to keep women on his team even when other managers were losing them. we don't know it was an official policy within uber that managers were being graded on retention rates, but it seems it is clear that at least within the company, people are paying attention to who is able to keep women in engineering, certain

demographic groups within their team, and it is important for uber to track who stays at the company as a whole. cory: it almost suggests, may be , they were trying to do the right thing or be more diverse, and yet, the way they did it ended up handcuffing them. >> i think every company is paying attention to this. the sense i get is that they do it in part because they know they are under public scrutiny and there are people in the company who believe it is good for the company and for business . they are trying to find policies that work for them. cory: that was bloomberg's ellen huet. the trump administration is bowing to invest in coal, but

china is trying to take the lead in cleaner technologies. bloomberg stephen engle got an inside look at how the largest state own power generator is starting to scrub skies and the image of dirty coal. onehina feels this is answer, a new power plant the industry likes to call a clean coal burner, spewing less toxins than the older general trader g. november. was open in towards moving renewable power generation, but bloomberg intelligence says coal counts for 75% of china's energy mix, down from 84%, but the move to renewables takes time. first off, china is rich in

coal and has less gas and oil. it is a fact there are many poor people in china. coal is the energy for poor people. >> they are building new coal fired power plants that are cleaner. he says it doesn't measure co2 emissions on site, but we could see what they called the in missions sulfur dioxide and nitrous oxide that they say de-sulfurous station scrubbing process are 10 times less than a traditional thermal coal plant. andgovernment gets the data can punish plants if emissions get too high. burning cleaner coal does have it cost. it is spending a little more

than $1 billion over the next two years and stalling the clean coal tech at a time when the industry is in crisis. overcapacityore than any other sector of china. the utilization rates are 50%, 60%. this is an industry with high fixed costs and with utilizations that low, there are huge losses. >> the world coal association wants the world to use more, but argues president trump's plan to revive the coal industry can lead to cleaner solutions. >> we believe president trump will be looking at this deployment in the u.s. >> it doesn't hurt when the weather does his part on one of the clearest blue sky days of the year. cory: that doesn't for this edition of the "best of bloomberg technology". we bring you the latest in tech throughout the week.

tune in every day, 5:00 on the east coast, 2:00 on the west coast. all episodes are now live streaming on twitter at @bloombergtechtv. check us out. this is bloomberg. ♪

carol: welcome to "bloomberg businessweek" i am carol massar. . oliver: i am oliver renick. carol: the uphill battle president trump may face. oliver: we talk about the cyber hackers targeting central banks. carol: the reinvention of espn. oliver: all that ahead on "bloomberg businessweek." ♪ oliver: we are here with megan murphy to talk about some of the stories in this week's issue. let's start with the opening remarks