mark: i am mark crumpton in new york. you are watching "bloomberg technology." "the washington post" reports the investigation into potential collusion between russia and the trump campaign has identified a current senior white house official as a significant person of interest. that official has not been identified. that development comes as president trump heads on his first overseas trip since taking office. the president will make five stops in the middle east and europe, including visits to saudi arabia, israel, and the vatican. he will also attend two summits. the president did not name a new f.b.i. director before leaving. "the new york times" citing a document reports he said firing james comey relieved great pressure on him.

mr. trump also reportedly called the former director "a real nut job." deputy attorney general rob rosenstein tells congress he stands by a memo that he wrote that preceded the firing of james comey. in remarks to congress, he says firing the f.b.i. director was appropriate and listed concerns over the handling of the clinton email investigation. the congressional budget office will release a cost estimate for the health care bill that passed the house next wednesday. speaker paul ryan has not sent the bill to the senate because the c.b.o. report could force another vote. i am mark upton reporting from new york. ♪ emily: i am emily chang.

and this is "bloomberg technology." president trump takes off his first official trip overseas but leaves behind a white house in damage control. we will analyze the potential impact of the drama on tech. uber in another p.r. nightmare, this time the fury coming from within. we will dig into that and the latest on the court battle with waymo. streaming domination. we will get the inside track from c.e.o. anthony wood later this hour. but first to the lead. donald trump is embarking on his first international trip as president while controversies continue to swirl at home. his eight-day odyssey will take him to the middle east and europe where he will meet with the saudi king, pope francis, and newly elected french president emmanuel macron. news reports surfaced over the firing of f.b.i. director james comey. the "new york times" reports president trump told russian officials firing comey relieved

pressure on him and the investigation into his campaign ties with russia, reportedly going on to say comey was crazy and "a nut job." we are joined by shannon pettypiece from the white house. what is the reaction to the latest revelation? >> the white house is pretty much empty at this point. i could have told you about door slamming and people scurrying into meetings. right now they are all on planes. if they were hoping for a couple of quiet days before the coming testimony on wednesday and the budget on tuesday, i think this will be the question all of the reporters are asking on saturday when they land, throughout sunday, who knows what the week -- weekend has in store. it changes the agenda from the things they want to be talking about to the things being talked about back home. as they go to meet with foreign leaders who know officials are watching the reports closely as well.

these things will be at the top of their mind. emily: sean spicer released a statement saying the investigation would have continued and obviously the termination of comey would not have ended it. the real story is national security has been undermined by the leaking of highly classified conversations. talk about what we are expecting when it comes to the home front over the next few days. potentially a new f.b.i. director could be named any moment. >> it is interesting you mentioned that statement. that part of the statement was his defense. earlier in the statement, sean spicer basically acknowledged comey was fired because of the russia investigation, because of politicizing the russia investigation. he said remember the initial story about the comey firing was supposed to be it was based off this memo from the deputy

attorney general. the president said he already knew he was going to fire him going into it. this statement from sean spicer says it was because of this russia investigation, they did not like how he was politicizing it. the story keeps evolving over comey. wednesday, we are expecting to hear testimony from comey. huge headlines that day and the day leading up to it and likely the days afterwards. all this going on as the president is in the middle east meeting with european leaders and trying to develop new relationships for this young presidency. emily: specifically, a statement from sean spicer. he says by grandstanding the investigation, james comey created unnecessary pressure on our ability to engage and negotiate with russia. to what extent do we expect these issues at home are going to overshadow what is happening abroad? >> i doubt nothing else is going to come out this week. i think the domestic issues at

home will be the issues abroad. if you are a foreign leader sitting across from president trump right now, you will have all of these things in the back of your mind. you will have in the back of your mind that he reportedly leaked intelligence, intelligence given to him by the russians. about how this would relieve pressure from the investigation around russia by getting rid of comey. you are going to have in the back of your mind that he tweeted about potentially having tapes of the conversation. all of these things in deciding if i can trust this person, if this is going to be a friend or foe. all of those domestic issues will be on foreign leaders' minds. emily: shannon pettypiece live from the white house. thanks so much. a busy weekend likely ahead. let's get more perspective on the administration and how chaos

in the white house could impact silicon valley. with me in the studio, roger mcnamee, cofounder of elevation partners. silicon valley cannot widely -- came out widely against trump. what has been the reaction over the last several months as the revelations have unfolded? roger: the stock market has had no problem with any of this. especially not for tech stocks. at some level, people in silicon valley are very happy with what has happened to their stock valuations. where i think the challenge comes in is with all of the focus on fake news, there has been a failure to appreciate the real challenge from the russians came with manipulating public opinion around things people may have believed, reinforcing them so strongly it caused some people not to vote and other people to get into various emotional states that were not healthy. the thing we do not want to lose sight of is that is still going on. there was a report this morning about the russians putting bots into twitter to influence public opinion in the united states.

i think the tech industry has to this point gotten a free pass on all of this stuff. we are talking about the folks in the persuasion business. this is google, facebook, to a lesser extent twitter. others in the ecosystem in the persuasion business, their tools are being exploited by unfriendly people in ways that are not helpful. this is not the result of a strategy by any of these companies. this is an unintended consequence of an incredibly successful business model. emily: as you say, the stock prices of google and facebook continue to rise. what are their responsibilities when it comes to fake news and these concerns? roger: i don't worry so much about fake news. i think it is a convenient way of distracting attention from the real problem. that is the techniques of persuasion necessary to make an advertising model work, those techniques are not just between facebook and its users.

but any advertiser that uses facebook. bad things have happened. many unintended. my point is, let's have a conversation about it. i don't pretend to have the answer. i know these are good people. this is not like we have these bad guys in a castle throwing thunderbolts at the people. i don't think it works that way. i think this is a model that when these companies were small could not do harm to anybody. but when you have 1.9 billion members in facebook or one billion in instagram or 1.4 billion in google or 1.3 billion in youtube, you have the influence of a large country. billion in instagram or 1.4 in the case of facebook, several large countries. at that level, there is responsibility. i want to have a conversation about what the limits of that responsibility might be. emily: how does it play out in a highly politicized and polarized environment? when i tweet anything about trump on twitter, a neutral story or a factual story, i get

rained down on by the twitter trolls. roger: people's positions have become hardened because the tools of persuasion have become so effective in reinforcing existing beliefs and making them less flexible. i don't have the answer. i just want to have the debate. this is not about good people versus bad people. this is about a technology that began with the best of intentions that has inadvertently put us in a place where we do not have control of it anymore. the people to do have control of it do not have as much control as they thought they had. emily: there have been a lot of concerns about trump's impact on the tech agenda, whether immigration or net neutrality. do you see those things coming to fruition?

roger: i think the immigration issue is a huge problem. they have already taken steps. the one part of this administration that has worked effectively has been the department of justice. it has been doing it by attempting to take us back to a time when we were a less balanced, less fair country. i think in awful ways, we are hurting ourselves as well as the people affected with immigration status issues. i think it is terrible for the economy. it will be bad for the agricultural economy. it will be terrible for the tech economy. you have already seen a big impact on college applications from people coming in from the outside. you have seen a huge impact on tourism. for what? what possible benefit are we getting from this? that part scares me because this country, our culture should be better than that. we have to stop pretending our economy would be better if we take these amazing people out of it. emily: a lot of tech giants were counting on a big corporate tax cut, bringing cash home from overseas. there is now uncertainty around

that and the entire agenda. what does that mean for tech? roger: i don't think tech companies needed to repatriate cash. i know they did not. i don't know that they were counting on it. i think there were short-term shareholders hoping to get a big windfall from it. whether it happens or not is less an issue for tech than the other direct impacts on employees and customers, and frankly, on trade. to the extent global market are jeopardized in any way, that is terrible for tech. these are global companies. they operate in china and mexico and canada and africa and europe and asia. emily: we have yet to see these gentle terrible consequences. roger: i would argue you see the beginning of it when we see college applications down dramatically, tourism down genetically. those are direct impacts of these policies which will ripple through to the entire economy.

maybe it will not affect iphone sales on the first day, but eventually somebody will have a problem with this behavior and they will have a reciprocal response. that response may be something we don't like. and then you are in a trade war. who benefits from that? nobody. emily: every day brings something new. we will be following trump as he travels the globe over the next several days. roger mcnamee, you are my guest host for the hour. an update on toshiba's sales of its chip unit. broadcom at a private group are emerging as the two leading bidders. the talks are still fluid. toshiba may not decide on a buyer before the shareholder meeting scheduled for june. coming up, another day, another p.r. nightmare for uber. details next. "bloomberg technology" is live streaming on twitter. check us out. this is bloomberg. ♪

emily: bitcoin continues its record run. it crossed $1900 for the first time marking its fifth day of gains. bitcoin has more than doubled in value since the beginning of the year amid global uncertainty and increased interest in asia. skeptics have said there may be a bubble in the making as it has repeatedly broken records without showing any signs of slowing. another week, another problem for uber. drivers are voicing their anger over the widening gap between what they are paid and customers are charged, this on top of new developments in the startup's court battle with waymo. we are joined by eric newcomer who has been busy over the last several months. still with us, roger mcnamee. the pricing story. what is happening now? >> we have upfront fares where riders set the price. it was still fundamentally rooted in time and distance. now we are seeing we can do machine learning calculations, figure out what you are willing

to pay, and charge you. we will bucket people and say you are going from here to there. there are people willing to pay on that route. they are calling it route-based pricing. we are moving to a world where uber can say, "what are people willing to pay? we will charge them that." it is also an opportunity for uber to take more for themselves. some gets reinvested in bonuses, but it does seem like a move to take more of the money rather than give it to the drivers. emily: i ride lyft and uber a lot. every driver i speak with prefers lyft over uber. these are just my rides. they are not happy with the way uber treats them. i wonder if they can get over

these issues. roger: i think uber has a culture that is so deeply flawed that i wonder how they come back. they have the scale, and they have a lot of cash on hand. but the way the invest cash and their day-to-day business practices are horrible. my partners are invested in uber. i understand why. i passed on it because morally i can't. i come from a different place. that is a judgment for me. i look at them and cannot go there. emily: small issues. the driver yesterday, a lyft driver switched because he said uber would not reimburse him for the tolls. i don't understand how there is any excuse for that. roger: i think in the long run if you treat your most important

asset, in their case, the drivers, really badly, karma is going to get you. i have noticed this with friends. when we are at an event, they are all using lyft now. one of the reasons is because it comes faster and drivers are not responding to the uber calls. that is local in the bay area. if there is an issue for uber in the bay area, that is really bad. emily: we know lyft has better coverage in the bay area. is this happening all over the country? >> lyft is gaining market share around the united states. uber is fighting back. at the end of the day, uber holds the majority of drivers and rides. i hear the same thing. drivers will say i prefer lyft. they preferred the lyft brand but still go where they make money.

uber knows with this pricing, they are redirecting money to bonuses and other incentives to keep the drivers on their platform. some of the bonuses are you need to drive 100 rides for us. there are ways to lock in drivers through compensation to keep them on their platform rather than going to lyft. emily: i was speaking with fred wilson, the venture capitalist, earlier this week. he said it will not be winner take all. is uber still a $70 billion company? roger: i don't think it ever was. the challenge is to establish a profit model that justifies any high-level of valuation. if you think about it and apply a google price-earnings multiple, they have to have net income of $6 billion. to apply the apple model, they have to be in double digits. they are nowhere near where they have got to get if they want to have from a terminal value point of view. more power to them. they may see something i am

missing. when we get onto this issue of driverless cars, one of the challenges i think uber has faced is they are always trying to do more things today than their income statement can handle. if you are in investment, the dream of making those big ideas work has got to be powerful. but at the same time, the probability of making it work is low. >> that is how uber thinks of it. we have been able to raise this money. we are going to build and invest in self-driving cars. we are going to make those investments. we will be a huge company. but it is risky. emily: look at the balance sheet. eric newcomer, thanks so much. roger mcnamee of elevation partners, we will talk about it at the break. stick with me. after selling virgin america, what is richard branson's next act? we will hear from him in an exclusive interview next.

this is bloomberg. ♪ emily: we had a spirited

emily: we had a spirited conversation about uber in the break. we are still here with eric newcomer and roger mcnamee. give us an update. >> uber sent a letter to levandowski saying you have to testify or we will fire you. that is not a surprise. they need to show they want him to testify in their defense. emily: the ongoing court battle over self-driving cars. roger, you think this is a big deal. roger: i think it is a huge deal because i think self-driving cars are further out than conventional wisdom. as a consequence, it will not come soon enough to save uber. they are much better taking money they would invest and buying cars. in china where the great move

was to get 10% of the biggest chinese ridesharing company and exit the market rating billions, i think exiting self-driving cars will be a profoundly positive thing if and when uber chooses to do it. emily: they already have self-driving cars they are testing. roger: so what. you have self-driving cars that can be the core of the fleet still 10 or 15 years away. i don't know how long it will take. we have to change the way roads were, the way cities work. >> there are humans in the front seat. how they get to know drivers where they change the economics of the business. i agree, the distance is out. i say the uber defense is they need the story of someday they will be self-driving. there will be growth.

they think they need to make the human drivers business profitable. the idea is self-driving if them this story that at some point we will have a new business even better and you should keep investing on that. roger: it also causes the risk of bankruptcy to go to nonmaterial. i think they are nuts. at the beginning, they should have bought cars that was literally the same for everybody. like southwest airlines. every plane is exactly the same. they should have done this. bid them for 50% under cost in the consumer market. put them on the streets with keyless entry and give drivers the key. own the car, own the insurance. that would have been my recommendation. they chose to do self-driving instead. i don't think self-driving is the answer. i agree. it will be hard for the valuation when they exit. that is better than going broke. emily: roger mcnamee always has provocative predictions.

roger mcnamee sticking with me. coming up, the cord cutting continues and competition heats up. we will talk to anthony wood, the roku c.e.o. next. ♪

mark: i am mark crumpton in new york and you are watching "bloomberg technology." let's begin with a check of first word news. james mattis says president trump has issued an accelerated campaign to aggressively combat islamic state. >> he directed a technical shift -- tactical shift from shoving isis out of locations in an attrition fight to surrounding the enemy in their strongholds so we can annihilate isis. the intent is to prevent the return home of escaped foreign fighters. mark: two car bombs in baghdad have killed 11 people and wounded at least 20 others. the associated press cites officials who say four police officers are among the dead. the attack comes as iraqi

forces, backed by the u.s. led coalition, move-in on one of the last neighborhoods held by islamic state in mosul, iraq's second largest city. saudi arabia is the first stop on the president's first official trip overseas where preparations are being made for his visit in riyadh. the trump administration plans to announce $110 billion in advanced military equipment sales and training to saudi arabia this weekend. sweden's top prosecutor has dropped an investigation into a rape claim against julian assange. the wikileaks founder in 2012 took refuge in ecuador's embassy in london to escape extradition to sweden. he called the decision a victory for himself and the human rights system but he said it has taken a toll. >> in prison under house arrest, almost five years here in this embassy without sunlight. seven years without charge, while my children grew up without me. that is not something i can

forgive. mark: julian assange might still face extradition to the united states. u.k. party leaders spent the day campaigning ahead of the general election on june 8. prime minister theresa may addressed scottish supporters urging them to vote for the conservatives. the main rival and labor leader campaigned in bedford. the liberal leader also campaigned in bedford. iranians were at the polls to vote on a new president. four candidates remain including the moderate and hardliner. iran's first presidential election since the nuclear accord drew surprisingly large numbers with some waiting hours in line to cast votes. the man accused of driving his car onto one of the busiest

sidewalks in the u.s. and mowing down pedestrians has been charged with murder. the navy veteran hit about two dozen people. i am mark crumpton in new york. ♪ emily: this is "bloomberg technology." i am emily chang. it is a topic we continue to talk about, cord cutting. consumers have more tv options than ever before giving the media industry no choice but to embrace the shift to streaming. as more platforms pop up, the more consumers choose to watch this way. roku streamed about 9 billion hours in 2016, a 70% increase from the year prior. the company made over $4 billion in revenue last year. joining us, anthony wood, roku c.e.o., and still with us roger mcnamee. anthony, the industry has embraced streaming. it took a while. why choose roku over apple,

amazon? >> roku is the number one streaming platform in the united states. customers are growing 40% plus every year. we stream over one billion hours a month. that has grown 60% plus. why choose us? we have the best product with the best price and most content. emily: are you bullish? do you see consolidation? roger: i am bullish. you have this massive proliferation of content creators which has been a boom for the industry. you look at this and people talk about the golden age of television. that golden age of television is not about network tv. it is about the services like roku stream. i don't know what causes that to end because the success so far has been wildly above the threshold necessary to keep people doing it.

you have had new entrants like netflix and amazon coming into that space. it would not be shocking to see others come in. i look at this. the question to me is, what is the penetration of this around the country? i don't know. if we are even 1/4 of the way to maximum penetration, i would be surprised because it feels like something that will be ubiquitous at some point. emily: what is penetration? >> i think every household will stream. that is the future of tv. there will be operating systems in your television just like in your phone. emily: what does that mean for cable companies? >> the way content is being distributed is changing completely. half of roku customers do not have a cable subscription. those that do can get it on roku. you can download the xfinity app on roku. you don't have to have a cable box.

the way television is distributed is changing from cable boxes to operating systems like roku. that change is happening very quickly. roger: cable is the largest provider of internet access. the internet business is so much more important than the cable tv business to them today. at some level, they love what is going on because they can put xfinity or their apps on these platforms. emily: they make so much more on cable. >> their biggest business is broadband. the internet is causing a lot of competition. there are a lot more choices for customers. the margin in the district vision of video is shrinking. customers are getting better value. roger: they own a lot of

content. it is significant. you look at this and go, these guys have hedged their bets brilliantly. i look at this and go, are people going to consume more video and pay more for it 10 years from now? i think the answer is probably yes. will they change the way they get it? almost certainly. >> consumers are watching more television. they get more choices. they get to watch what they want to watch. that is what we are seeing. emily: what does this mean for companies like netflix and amazon? these are companies spending billions on original content. can they keep it up? roger: who knows, but so far they have. the failure rate when you first start up is normally very high. when you get experienced, you should be better at doing something. what is fascinating here is they both hit the ground and did not make any tragic errors. they each had monster wins right out of the chute. i look at this and think the burden of proof is on those who do not expect them to be successful.

the margin does not matter for his business. all that matters is people make more content and make content looking for distribution channels other than network television and cable packages. emily: the last thing about apple. we have been hearing apple was coming with something special for tv. is this it? we know they are dabbling in original content. roger: i have no idea. i love apple tv as a customer because i'm old enough i need simplicity. i like the portability. plus, i have a large investment in itunes product which made me an above average customer for them. you probably have a different point of view. >> apple tv has the smallest market share of any streaming players. the number one players are in another category. roku express for $29 is selling like gangbusters. the way most customers will get the streaming platform and operating systems will be built into the tv they buy. last year, one in eight tv's were powered by roku. this year, one in five smart tv's will be powered by roku. every tv will come with the operating system. roger: is there an economic

model in putting that in the tv? is that a loss leader that powers the rest of the business? >> we gain market share by distributing to tv. we are an advertising and distribution platform. one big thing about streaming most people do not realize is the world of advertising is changing. instead of nielsen ratings, we are moving to internet technologies with machine learning and targeted ads. that is a big part of what we do, building that platform. roger: what about people who get a smart tv with roku? >> it is the highest activation rate, over 85%. roger: that is really impressive. emily: anthony wood, c.e.o. of roku, thanks for stopping by. roger mcnamee, you are sticking with me. i want to get to a story we are monitoring.

coming up, the hack attack spread throughout the globe this week at an unprecedented pace. was the chaos worth it for the hackers? we will discuss in the week in tech. ♪

emily: the cyber attack started in the u.k. one week ago and spread across the globe like wildfire infecting more than 300,000 computers in 150 countries. while the events over the last

seven days are concerning, the payoff for the hackers has been less than impressive. earlier, i spoke with our bloomberg tech editor and a reporter at "bloomberg technology" about it and the other tech stories that grabbed our attention this week. >> people either protectively downloaded the patch. those who did not learned a very important lesson. other people were able to apply it later. they were -- maybe you gave up your data they were holding ransom, or you did the smart thing and backed it up. you backed up the patch so you can get your computer. emily: they claim they stopped 20 million attacks. we had the c.e.o. of symantec on the show. >> this problem is rife. it is a way of making money for criminals. it is definitely an effective enterprise but also has an effect on consumers and the digital safety. emily: not that much money collected but concerns on heightened alert about security in general.

do we know more about where this came from? there were reports earlier there were ties to north korea. >> they say this one in particular had a certain parallel to former attacks that came from north korea. originally some researchers were pointing the finger at russia. that seems to have shifted more towards asia on this one. in the end, it was not a sophisticated attack. that should not give anybody a false sense of security because they will come back and be more sophisticated in the future. emily: i want to talk about google i/o. there were announcements about voice assistants, google home, android. seems nothing too surprising. what was the biggest announcement? >> the biggest announcement was the continued push of the assistant into other places in

your home, in your pocket, in your car. emily: and also on the iphone. >> and also the iphone. i don't think they knocked it out of the park. i think they needed to knock it out of the park this year versus other years. we have the apple developer conference in june. it is going to be a significant year for apple. there are lots of announcement in store for new laptops to new mobile software. there is going to be a new iphone, one of the biggest updates ever this fall. google could have taken advantage of this apple wall. they have not done much. and they did not. emily: i did ask the head of android about becoming iphone redesign. take a listen to what he had to say. >> it is an exciting time to be a consumer because there's so

much going on, so many manufacturers working on interesting innovations. it is a good thing. it keeps the android manufacturers on their toes and makes us work harder. i think it is great. emily: very magnanimous answer, if you will. >> i think one of the things that stood out for me was the idea they want to take ai and put it everywhere. they are pushing deeper into their cloud computing offering which is crucial now given how far ahead aws is. google wants more startups to come to them. more smart you make your cloud computing offering sound, the more you have the potential to get startups excited about going to google and not aws. emily: is it going to work? >> we will see. the iphone on the surface, that is hundreds of new millions of people who can use google services. we have the story detailing why this is not great for iphone users. if you want a voice assistant

now on the iphone, stick to siri. emily: the cisco stock dropped on the back of a disappointing forecast. they say they're cutting 1100 jobs. >> on top of several thousand earlier. they have to make the shift. everybody is doing it. the shift into subscription, services delivered via software. companies are not investing millions in these like they were before. they are depending on a new system. cisco has to revamp. it is a big ship, hard to turn around. emily: alibaba beating revenue estimates, but there is concern about profits and what is going on in the broader china market. >> that is right. the growth is not happening at the same level in china. that affects alibaba. they are reaching out to millions of consumers across the country. if those consumers are less confident about their prospects,

about growth, about the economy, they will spend less on alibaba. what alibaba is doing to compensate is investing a lot in cloud computing and entertainment like their big u.s. counterpart, amazon, doing a lot of the same things. that will hurt the bottom line, the more you invest in new things to keep your customers sticky, the more that will affect margin and how you are spending the money. emily: that was tom giles and mark gurman. sir richard branson has hinted he may get back into the u.s. airline business. it comes amid a royalty tussle over the virgin america brand with alaska air which bought the airline in december for $2.6 billion. cory johnson sat down with branson. he spoke about the difficulties of the transaction and signaled something bigger on the horizon. >> they have said they will continue to use virgin america for another 18 months or something like that. and then they are going to merge all of the planes into one brand, alaska airlines.

cory: don't they have a responsibility to continue to pay virgin for the duration of the contract? >> until 2030, they carry on paying royalties. unless we decide to start another airline. we will see what happens. cory: is that something you would be willing to do? >> watch this space. emily: we are continuing to monitor the story about a possible security breach on american airlines flight anyone. that flight from l.a. to honolulu has landed safely according to an airline with virgin galactic, the test

program is going really well. we are as confident as we have ever been.

emily: a story we are watching musically. an app is in talks with media companies including viacom and nbc universal to make original programming according to people familiar with the matter. if the deal goes through, it may broaden the appeal beyond music like comedy and sports. speaking of music, a fun fact about our cohost for the hour. roger mcnamee is also a rock 'n roller. his band performs up to 100 concerts a year inventing such applications as twitter concerts and moon radio on twitter. roger mcnamee still with me. you play guitar. roger: and bass. they get to watch every show. our last 500 concerts are there in streaming video. emily: for free? roger: it is inexpensive to create it.

i am a tech person. i wanted to see if it could be done. we hold what appears to be a relatively fundamental patent on live streaming as it pertains to sending things to smartphones. at the beginning, i wanted to see if i could do it. it turned out to be a great way to promote the band. emily: there's so much going on in music streaming. pandora is looking to sell. spotify is planning for an ipo. what happens to the different players? roger: for 30 years, the music industry was in a defensive crouch trying to keep its act together as all of these new forms of entertainment came in an occupied the time and attention previously occupied by

music. all of that is now behind them. streaming has reached a point, roughly between 8% and 10% of smartphones have a paid streaming account attached. that is nowhere near the top. my sense is there is a tailwind behind the industry. emily: look at these pictures of roger rocking out. roger: that was a couple of weeks ago in san francisco. the key thing is i don't see anything slowing it until you get to about 50% penetration. they're not all going to spend $10 a month the way they do in the united states. some will be at much lower prices. but the notion there is a talented music, that is so foreign. the industry is still in its defensive crouch. the trick for any startup is can the industry realize i don't have to strangle this baby in the crib. at the end of the day, i think the music streaming thing comes down to amazon, apple, spotify, and everybody else has a

problem. think about it. for amazon and apple, they don't need to make money from streaming. obviously, spotify has a market position that makes it a survivor. the three of them are going to have tens if not hundreds of millions of customer accounts over the next few years. they will be adding them every quarter at huge rates. that is the tailwind. the question is what they do with that. can they find a way to get back into the frontline of entertainment? things that compete with facebook, video streaming, where they are active forms of entertainment. emily: on that note, we have one minute left. i want to take it out on facebook versus snap. what is your prognosis? roger: i would not want to be snap. facebook has a monopoly in social. it has been able to extend a lot of that leverage into instagram. they have been copying every feature of snap. i don't think snap is prepared culturally inside to defend

itself against a company that powerful. emily: are you still a facebook shareholder? roger: i am. emily: do you think snap goes away? roger: it is hard to say. they have a lot of cash but i worry about their business. it is hard to sustain growth in a business when you have a focused, committed, and deep-pocketed competitor. i would not want to own snap. emily: is it depressing facebook had to copy the snap features? roger: i agree it is depressing. companies with big economic power get to set the rules. we as a country made that choice. i don't think that is the best thing for innovation. i think it kills startups. if they kill snap, it is possible no other unicorn will get public above its last private round. that is deeply -- that should be deeply troubling. none of the others has. snap is struggling to fight off facebook. the market has a bullish view.

i personally do not. emily: we will leave it there. roger mcnamee, always great to have you on the show. everybody have a wonderful weekend. see you on monday. ♪

carol: welcome to "bloomberg businessweek." in this week's issue, a question being asked from wall street to main street. oliver: ifmerica -- america were a company, would you keep its ceo? "bloomberg's next on businessweek." ♪ oliver: we are joined by bloomberg news editor-in-chief john micklethwait. you essentially hold up donald trump his own meter stick, by his own standards for what he promised. tell us about how you went about