emily: this is the best of "bloomberg technology." we bring you all of our top interviews from the week in tech. the stivers strike felt around stocks jump monday on the hack attack. we will talk to a ceo. our extended interview with fred wilson. he tells us where he is placing his bats and why he is still a lush on jack dorsey. the mind behind the most popular joins us fromem

the developers conference to map the road ahead for android. look at the evolving threat landscape in cyberspace. president trump discussed highly intelligence in a meeting with russian officials last week. information was wholly appropriate and based on open-source reporting. take a listen to general mcmaster defending trumps actions. >> the story combined what was leaked with other information. it insinuated sources and methods. i want to make clear to everybody that the president and no way compromised any sources or methods in this conversation in -- conversation. emily: the intelligence community is working overtime. the attack a snowball the two

affect 300,000 computers in 150 countries. in at the national health service to the russian industry of interior. what are the bigger implications of both events for the intelligence community? mike riley covers technology for lubricant news. level, theglobal first wave of attack is been contained. people are looking for new versions and they's audit a wanna cry to point out that may or may not be from the same actors. where the attention is focused is who did this. there is reporting by security firms that may be linked to north korea. operation,s a state a couple of things that might affirm that diagnosis is the timing. the attack was released around the same time north korea did a new missile launch. some of things it might cut

against that is so far we know the ransom where that struck 100 countries is only netted $50,000 in the coin. this is a nationstate trying to fill its coffers because it suffering from sanctions, it's not very effective. emily: there is a blame game going on. microsoft is blaming the government and the government is blaming companies like microsoft. who is to blame? not going toft is come out of this looking good. there was a patch issued when the initial vulnerability was leaked by the shadow brokers did everybody knows that not everybody does patches the way microsoft would like them to. they might've shipped the operating system in a way that is much shaver -- safer to begin with. however you look at this, they

are not looking good. is it the intelligence agencies or is there a move to look at the way these vulnerabilities were first developed by the nsa that they themselves had some insider hack that allow the information to be released? this is the way nationstates work. china does this. russia does this. this is how they spy. the unit say is doing what it is dying -- designed to do. emily: thanks so much that update or in -- update. the industry rallied off the attack.the ransom ware they were able to block 22 million attacks. they say they may know who is behind this. joining me is greg clark.

your researchers believe that north korea is behind this. greg: we have some evidence that shows that the people involved in attacks linked to north korea, some of the code they used are present in this attack. that does not mean north korea and did it. it means there are fingerprints from the same kind of malware. the derailment before me mentioned the thing that would indicate this may not even cases the size of the ransom west. it does not track to the size that request. they were linked to the bangladesh attack. if you can get inside an enterprise and take over their systems, you request more than $300 in that coin. that doesn't help with the thesis. you never know. what may be another case it is here is a small group got hold andhis nsa vulnerability

wrote a more amateur piece of malware that got out of control that was attack -- aimed it consumers. there are a few things being worked. it's not time to call law enforcement for this. there are some things we shouldn't talk about yet. that thehe other point german made which is important, definitelys something we should talk about. i think i caps off has come a long way in recent years and hardening their operating system and how they deliver patches. this is about vulnerabilities. people become aware of them and they patch them. this is about i.t. and consumers being very quick to adopt the latest patches, whether it be an apple product, and google, microsoft. blockedou say you have 22 infection attempts how many

didn't you catch? greg: we have a small number saying they had an infection. we are talking about a really small number, hundreds of thousands of enterprises runner product. we have some artificial intelligence in our product it figured it out and stop the all by themselves. that's a big step over the industry. we have situations where other vendors may have been defensive who had blocks for it that were not updated. that's how things got out of hand in europe. emily: that's the lesson learned. the u.s. was largely unaffected. greg primarily in our view because the researchers the done on this problem early and work it found a situation in this malware that would turn it off and make it go to dormant. that was put in place on friday night. by the time people got to the

u.s., it was already sort of dealt with from a dormant point of view. it still might've been propagating, but not destroying the systems. emily: you expect spending to increase as a result western ark greg: whenever there is problem like this, we fair very well in it. we are starting to see that. i think the future is right -- right. we are not the kind from that gets up and bashes our competitors or bashes platform vendors. we are here to fight cybercrime. we share our information with the threat -- cyber threat alliance. on friday.hat we are trying to help the industry. we are a good operator. we have huge research

investment. emily: what trent -- trendy you see under president trump western mark -- trump? cyber criminals are emboldened, not just by the trump administration but why some of the effectiveness of some of the attacks. we heard about some things in saudi arabia that were very concerning. on othertes operate nationstates outside the u.s. cyber criminals are more emboldened than we have seen the past. we produce an annual threat report. we reported that ransom ware is on a huge rise. it is targeted at consumers. they have nowhere to go. there is no cio. the average prices got up to $1000 to repair. there is a way of making money for criminals and it is

definitely an effective enterprise and on consumers and their digital safety. emily: that was greg clark. disney is being held ransom by hackers. bob iger revealed the news to employees on monday. they claim to have stolen and unreleased film identified by hollywood news outlets as the latest pirates of the caribbean movie and are threatening to distribute online. the attempt as part of a larger global cyber attack or it it comes to weeks after netflix confirmed that hackers are responsible for leaking new episodes of oranges the new black after they refused to pay a ransom. come up, is the vc market oversaturated? we catch up with fred wilson next. if you like bloomberg news, check us out on the radio. you can listen on the bloomberg radio app and on sirius xm. this is bloomberg. ♪

emily: stone is rejoining twitter after he left. two months after he sold his he said het up or it will be focusing on company culture and will not replace another executive. we spoke to stone last thought over and asked about the at twitter. biz: i don't follow the rig up and down spread i don't look at the stock coming orderly basis. i think rate leadership thinks in terms of decades and not orders. -- quarters. in the grand scheme of things, jack has just got the job. he is had the job for a year. that's nothing. emily: shares of twitter jumped tuesday after the announcement that we are among their video partners. be --square ventures

remains bullish on the stock and we caught up with fred wilson wednesday. his firm has invested a number of companies including twitter, tumbler, foursquare, and kickstarter. market is the vc oversaturated. fred: it's hard for me to know. i don't know what the demand side of that equation is. it's clear to me that there is probably more good investment opportunities in the venture capital industry then a decade ago. we can order more capital. these things go up and down in cycles and we could be at a place in the cycle with there is more supply of capital than there is demand. we are on an upward sloping curve on both. i don't know. it's hard for me to say. more supplyere is

the demand, what are the implications? fred: prices go up. returns go down. sector andves the there is more demand and supply and prices go down and returns go up. that's the evident flow of capital markets and the pc business. watch thenow you bloomberg started from her the tracks the health environment for private tech companies. it's down from its peak in 2015. one of the negative signs and positive signs you seen this year? lot of sobriety in a number of sectors that is been very frothy in the past. we have new sectors that are now frothy. they will have to go through their own cycle, if you will. emily: twitter is one of your

most prominent investments. jack dorsey is bringing back is stone. how likely is it they can re-accelerate growth and revenue and sustain that over the long term so that they are bigger than it is today? fred: i am very lashawn twitter. i own a lot of twitter stock. i want those viewers out there to know that. i think twitter is unique company. the content you can get on twitter is unlike the content you can get anywhere else on the internet. that is becoming more and more the case, particularly real-time breaking news. i think anybody who wants to consume breaking news, there is no better place to do it than twitter. i love that the band is coming back together. back, that was the beginning of good things for twitter. back, i had coming

no it was happening. it made me smile. i am so happy about it in -- it. facebook is been copying snaps features, what is your prognosis for snapchat western fred: facebook is no original ideas. a but of byput in copying them. that is the question to really ask. emily: does that mean you are optimistic? fred no. depressing that a company like facebook can't come up with any new innovations on their own and have to copy companies. emily: what about uber? they have had their share of issues. what went wrong there? is theythink the issue believe they can run the table on the market and capitalize the

company and build a strategy around doing that. what has turned out to be the case is unlike search or social media or e-commerce, ridesharing doesn't look like it's going to be a winner take all market. they are really struggling the realization that they are in a highly competitive market that is going to be competitive for the long-term. a lot of the things happening to them are kind of happening because of that. they have become a lot more desperate. i think it's tough times there. when those things happen, you see companies, and glued a little bit or it that's what it looks like is happening there. emily: how much of it comes down to the leadership? what responsibility this travis avenue? fred: they created the strategy and get it. they are accountable for that, aren't they? emily: that was fred wilson.

coming up, the google conference kicked off in mountain view, california this week. we will talk to the man behind the android operation. amazon made its debut as a public company. we will talk about how it became the tech behemoth it did today. this is bloomberg. ♪

seattle-based bookstore to the public market. the company was amazon. the value, nearly $440 million. today, this book startup is actively running the e-commerce world. $460 billion.h the stock is trading around 600 times its price on the day of the ipo.

a $10,000 investment back in 1997 would he worth $4.9 million today. to transform itself, amazon has pumped cash into areas like amazon prime, web services, the amazon echo ai platform. while this cash burn his worried investors, they have turned a profit for eight straight quarters thanks in part to the strength of his cloud computing is this. the market cap for step of billion,worth $230 half of amazon. amazon is stepping further on to walmart's turf, opening stores. a battle royale to watch for the next 20 years. took: googles conference place this week and among the new developments, a new supercomputer chip for ai and

they are making a digital assistant available on the iphone. togle offered updates android. we spoke to the man who runs android. we talked about some of the most exciting announcements. hiroshi: we announced a lot today. there are now 2 billion devices in the world. that is very humbling. we're really excited about that. we announced the beta for android, our next release. we announced a new configuration of android starting with android go. that is aimed at devices in emerging markets, but have one gigabyte of ram. we are making that experience great for those users. those are some the examples we announced today. emily: what progress has been made? hiroshi: we announced android

n last year and many devices are up rating to it. there is a lot of good stuff in there. sort of new security features are you integrating? what you doing to combat fragmentation? hiroshi: there is a lot we are doing. it is something we've been working with the industry on for many years now. specifically, we announced project trouble. we are reconfiguring it. for the industry, it's a big deal. we redesigned the bottom part of android the deals with the hardware to make it easy for operators and manufacturers to update the devices and really have a quicker turnaround time. emily: what about security?

what new security precautions have you introduced? we are weathering another global cyber attack. hiroshi: weird doing a lot for many years. one of the things we realized is a lot of what we have been doing is behind the scenes. there are a lot of protections we put in place. also protections we put in place to google play. we scan all of your apps. we're scanning them all the time. no user of android was aware we are doing this. we put the systems front and center for the users so they can see what we are doing so they can have a sense of security and that reflects the real state of the world. we call that google play protect and we will be rolling that out soon. emily: last year you introduced instant apps. what kind of progress of you made there? we work since last i/o,

with many developers on this and improve the infrastructure for that. starting this week, we are expanding that so that anyone can develop instant apps. making it easys for users to get their apps without having to go through the installation process. emily: the new phones that google have been making have not sold very well. how has that impacted android? hiroshi: pixel was developed by the hardware team. i work with everyone, all the manufacturers. lg, samsung, you name them. we don't comment on any particular device. we are to have more manufacturers out there and targeting their user segments. that's what makes android rate, it goes across multiple partners. emily: you have a new auto dashboard system with volvo and audi.

what is the strategy in the car? hiroshi: we have a number of products available for the car. the first one we call project did mode. android to be plugged into the car and have the phone power the cars system. that has been a while for a while. there are car models that support this. with audi in volvo, it's running android itself in the car directly so you don't need a phone anymore. it's kind of a behind the scenes thing. it's how they are making cars. they happen to be using android, which makes it easy for developers to bring it their apps into the car environment. coming up, though merits is coming back he seaworld. he is completing his new firm. we are asking him where he is putting his money next year in a

this is bloomberg. ♪

♪ welcome back to the best of bloomberg technology. i am emily chang. bill morris is returning to the investment world. the founder of's google ventures has raised $150 million for his new fund, section 32. we spoke to him in an exclusive interview. uber.rsaw startups like bill: i think we are still at peak ac. but i wasn't happy with the fund i was constituting in terms of the investor base, so i had to reconstitute it and build a smaller, more focused fund. and i think the majority of the

ies invested in our based on relationships 10 years or so. emily: how do you break and? how do you differentiate yourself? bill: hopefully i don't have to break in. can besmaller fund, i selective in the companies i invest in, the people i hire. environment ofn over funding, selectivity is your ally. emily: you don't often see lone wolves, you are doing this from san diego where you live and you are not just investing in health and biotech, but tech, which is super competitive. how do you think you can step up? bill: i lived in san diego for years, i exist in the cloud.

especially coming out of san francisco, the idea we are limited by geography is kind of crazy. the best returning and -- all time, >> you don't necessarily plan to do it all by yourself? bill: no, not forever. emily: where are you placing your bets? bill: more readily in my mind available are getting excess attention, ai machine learning, the arm. health care has become a trendy area for investment, which means subset -- subject of over funding. agricultural tech or other applications of tech being available. i have been spending a lot of time looking at the food chain. emily: interesting you bring that up because we have been i'ming about to sarah --

sure you saw bloomberg did a big piece about how this juice machine got $100 million in funding and our reporters here discovered you could squeeze out just as much juice by hand as the juice machine itself. was that a mistake? how the, we don't know company plays out from here. they have great leadership and ample cash, it is still going. i think my time in the valley has taught me that some people when they see a balloon they just want to pop it. , so just want to poke at it i would say there may have been a little too much kicking someone when they are down. emily: what about uber? -- a lot of pr issues the last several months, a lot of culture issues, lawsuits. what has gone wrong or? the parallels between uber and the white house are hard not to draw. they're having a hard time.

fundamentally that is due to a lack of leadership. there are a lot of great people there, friends of mine and i would like to see the company pull out of this, but they are having a bad couple of months. comparing him to donald trump. bill: you are, i said the white house and uber. when it comes to the white house, we should be gravely concerned. i am. first time in my lifetime i felt our institutions are unstable or unpredictable and i think there is one thing that we as a people little bitish is a of consistency and reliability in our federal government, and i think it is a confusing time. emily: what does that mean for uber? let's continue with the metaphor. , you when we look at uber have a company that is -- isormative, that has in a period of struggle.

i think google faced that, facebook faced that, this is an unprecedented situation with such scale that generates such attention available to consumers all over the place. i don't know how it plays out from here, but i am hopeful. emily: is travis the right person to lead? bill: i'm not the right person answer that. i haven't been to their offices in a long time. i think the employees of uber are the right people to answer that question and hopefully they are being asked. emily: how is trump impacting silicon valley, the funding landscape? bill: it is true that mark gets like -- markets like predictability. there are a lot of unknowns coming out of washington and surprises. some of those aren't pleasant. i turn on the news every morning and think, ok, what crazy thing has happened this morning?

that creates a general anxiety that is not good for markets are people. emily: how will that influence the choices you make when running in a fund? bill: we will see. i have never been that influence by washington and policymakers outside they set the ground rules and those haven't changed very much. but the instability in washington is something to keep an eye on. emily: i was bill marist, former ceo of google -- >> and/or it is planning to sell its business to focus on music streaming service. the company still looking for a ,uyer for the entire company but selling the ticketing business could be an option if that doesn't happen. and/or paid $450 million for tickets in 2015. coming up, across the pond we speak to the ceo of a major player in sin tech. transfer wide, how they plan to whether the brexit next.

♪ emily: a story we are watching, the patent battle between apple is heating up. chip company has sued assemblers of the iphone for not paying patent royalties. has suedse, qualcomm pegatron. apple doesn't have a direct license, instead it pays contractors to make the phone and part of that money is used to cover royalties. to london where bloomberg's caroline hyde spoke with a major player in fintech. largest: one of the clear to pay services in the u.k.. in fact, if not the world. helping to move more than a billion pounds per month, the country has waste $170 million in funding and investors include and sir richard

branson. thank you for joining us. key player in the european unicorn space. big investor names. you are profitable. whether the profitability is something you were always striving towards. aswe have always known that we hit critical scale, we were going to get to the profitability. now we are moving a billion pounds a month. a million users using transferwise. we have hit profitability, our goal remains keeping and making sure we can have the biggest impact. >> did you ever think when focusing on profitability am a you are looking at your bottom line or is that not the case? can be i think it mutually beneficial.

for us it is important to make sure we are country by country and quarter by quarter basis with strong economics. the company of a whole breaks even, making sure its fundamentals are sound is very important. caroline: has there ever been any pressure from investors to become profitable? slightly more wariness about sustainability of business model, is that something people have been calling for or something you have driven yourself? taavet: i think there was a change in the market two years ago where creating growth at all cost changed a little. companies that have proven they have sound under not -- financials for growth have always come of this which was pretty small. some companies were going way too crazy. you think some are still going to crazy?

there are seems to me two different companies with different profiles. from what we heard recently, i we are probably very close to it, whereas with mover, we hear about massive losses still. it is hard to compare them. i do think they are doing well. caroline: is that a european mindset that makes the investor base a little more cautious, the entrepreneur, therefore looking for profitability that much faster? how do you think we here in london, particularly excavating not dominating other areas compared to silicon valley? taavet: it goes back to the beginning. when you think about how many companies are being started in europe. there is a difference in the risk appetite. i think you can feel in europe. lets companies being started, so less companies get to scale and growth and maturity.

as part of that different mindset, people will take less risk. tolerated,'t so there might be more focus on becoming profitable sooner. caroline: therefore this is ,omething that is very much european startups about 60% profitable, perhaps that would be lesser if you look at the united states. therefore while you have profitability, are you looking to raise more funding? you are certainly spent -- expanding. taavet: we're are in a very good position regarding funding and financing. we're really focused on how we make sure to keep on growing as quickly as possible. we grew at 100% last year and are continuing. for us, the question is about how do we double down on small to medium business? how do we look at expanding into other areas? caroline: talk to us about where your investing to sustain the growth? where you would expand into new areas of product?

is it about hiring engineers or is it in the marketing face? areas close to transfer of funds, but expanding that product suite? taavet: we are quite sizable, but we are continuing the hiring and across all fronts. engineers, marketeers, all needed to keep the business going. similarly, we are doing it in multiple geographies. headquarters in singapore, hiring in the u.s. and london, and mainland europe. we launched a small to medium business offering last year, that is something we are excited about and looking at growing significantly. morehere will be nor -- announcements later this year about adjacent areas we are looking to expand to. caroline: you are a fascinating man because estonian about your startup. i look at your twitter page and

you have pinned a statement saying, founded by immigrants, built by immigrants, used by immigrants. theit is upon us, these are geopolitical trends throughout the world. how much has brexit affected your business? willuch do you think it change her opinion on growing a business in the u.k.? you are committed to the area? taavet: we are committed to being in london. however, when we talk with brexit, we cannot talk about two things. the important thing about brexit are, access to talent. every fast-growing company thrives on talent. it becomes harder for foreigners to move to london, to move to the u.k., that is going to be hurting the ecosystem here and as a result, jobs will be created elsewhere instead. the second is passporting come in europe has a fantastic system today where one visa to 5

million consumers -- 500 million consumers, unlike the u.s. where it is state-by-state. survive,is unlikely to but as a business contingency, we need to think about serving our customers on the european side. emily: i was caroline hyde with the ceo of transferwise. another story, government officials from the -- in brussels for an in-flight ban on tablets on flights to europe entered in the united states. the department of homeland might expand the ban. the new protocol could mean longer lines and heightened delays. still ahead, we will hear from -- onely of one of the of the best-known female investors in the world who spent over 15 years investing in chinese startups. cisco's ceo chuck robbins joins us after the company plunged the

most in two years on its earnings reports. in this is bloomberg. ♪

♪ taylor: cisco, the biggest maker of the equipment that runs the internet, announced corinne earnings beating estimates about plunging on the news it sales forecast was cautious. cisco ceo chuck robbins from san jose. we fundamentally believe tax reform is needed. we have discussed in washington about how that should be structured and there are two key things. tax reform for overall lower corporate tax rates are needed to make u.s. corporations more competitive and repatriation is important for those of us who have cash overseas so we can bring it back and making investments in the united states. variousorking with

groups in washington, congress, etc. to try and help move that forward. relative to the business impact, we are focused on a few things right now. number one, we are transitioning our business to a more software subscription business. secondly, we are leveraging our ability to innovate both through inorganic and organic capabilities and finally, working with our customers to help them prepare for billions of new connections that will come online in the next generation of capabilities and neck working -- networking. tax and perspective of repatriation, we don't run our business under the assumption it is going to happen. if it did happen, it would be positive force. >> you mentioned this transformation you have been taking cisco through, from a hardware company to a software hybrid company. as you look at that, part of the reason your stock didn't do well yesterday is you said going forward, it is looking soft in

purchases. are there mergers and acquisitions you could do with that cash you are holding that could fix the problem? david, first of all, software and subscription transition, we have more than dollarsthe amount of sitting on our balance sheet from software subscriptions in the last eight quarters. nowas up 37% last quarter, 4.4 billion. that transition is moving. we put 500 million on the balance sheet. we are accelerating that. that, we have technologies we have built internally that are contributing to that balance. we have acquisitions like apt close.s that will there is an opportunity for us m&arive m&a and we see both as well as our own internal ability to innovate and drive more of our technologies to this model, will be the strategy we

deploy going forward. manus:: back to tax reform, cisco has had big buyback programs the last couple of years and i struggle to understand what is stopping you from making investments now that you would need to wait for the tax reform to do it. why do you need wait for tax reform when you show you have access to all of this cash to execute big buyback programs? what is stopping you making those investments currently? us at it is not stopping all. we have been active on the m&a front and have been increasing our dividend here. we have been driving buybacks, i fact ourgest that the caches overseas hasn't stopped us from doing the things we need to do, if the cash were back your it would make it a little us to and perhaps allow accelerate some things. but it is not stopping us from doing the things we need to do right now. emily: let's not focus on the broader investing landscape in china. its joining gg fee capital,

jenny lee has helped put the firm on mapping china with investments in high soft while climbing the ranks to be one of the most recognized investors in the world. lee is based in shanghai and joined just in san francisco this week. we spoke to her about what has changed in china. jenny: investors are more certificate ash sophisticated. two, the internet market is a lot bigger. we are not talking about innovation. v's chinanched gg operations in 2005 and china changes every day, let alone every year. what has surprised you most? i think the size of the market has always been the most interesting aspect of china. ,t is not just a tier one city it is also a tier two cities, that people are talking about

innovation. we don't have to work for the government now. we can make something of ourselves. the entrepreneurial spirit is something we have seen change over the last 15 years. emily: there are several stages of technological change. you could say alibaba, then mobile, now online to off-line, what is the next big technological shift that will happen in china? next area is something i have been spending some time on. where we're looking at technology, new products, they are changing each of the in china. i have been spending a lot of times with folks looking at cool products and cool services. emily: you also talk about something called beyond silicon in terms of ai and machine learning. what does that mean? jenny: to give you a little more

background in to what we look for, there are three big areas. first is transportation. anyone who has been to china knows how transportation is and there is room for change whether knight transportation, air , seeportation or water transportation. in that area, we are looking at the whole ecosystem around autonomous driving. computation, algorithms, and then we talk about complete electric cars in china which is a huge market. that is the one big area. the second is the whole area of robotics, automation. robotics automation, we are looking at home robotics. industry.tics for the a very cool area. we think about droids, or are

robotic aspects, but these are robots that fly in the end. emily: these run into a lot of regulatory issues in the united states. what is the regulatory landscape like in china? jenny: the government is very supportive of this area. actually outline very specific areas, areas that have been highlighted. the government is going to invest and encourage the development of this industry by r and promoting rmb, -- d, supporting schools, in machine learning area particularly. they are committed to spend over 50 billion u.s. dollars in the next two years in this area. think government is very supportive, they are stepping up in terms of policies but also in terms of real tangible dollars to promote the industry. u.s. tech companies have

had problems entering china. facebook and twitter shutdown, googles out, uber is out. will airbnb have any success or the others have failed? jenny: if you do come out with a very good service, but that service has to be vocalized -- localized for the local consumer, then they will be successful. emily: you think that is why facebook -- >> i think being in chinese is not enough. the usage, behavior, consumer interaction. if you look at we chat, you know that is the idea. chinese consumer would measure any competing project with homegrown products. to compete in china, you have to understand that nuance and be able to really address the local consumer. this: and that does it for edition of "the best of bloomberg technology." telecomek, jpmorgan

conference, monitoring conversations. randall stephenson and twitter ceo jack dorsey. that is all for now. this is bloomberg. ♪

carol: welcome to "bloomberg businessweek." in this week's issue, a question being asked from wall street to main street. oliver: if america were a company, would you keep its ceo? carol: that's next on "bloomberg businessweek." ♪ oliver: we are joined by bloomberg news editor-in-chief john micklethwait. john, in your opening remarks section of this week's "is this week" 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 taking about this.