♪ emily: i am emily chang, and this is the "best of bloomberg technology," where we bring you all our top talk interviews from the week in tech. coming up, president trump withdraws from the paris climate accord, while leaders in tech from tim cook to elon musk speak out. plus uber fires the star is a the air who was once at the wheel of the self driving car program and its bitterness -- with waymo. why is was time for anthony levandowski to go. and the new phone of essential and how it stacks up against apple and samsung.

first, to our lead, president trump has announced the united states will withdraw from the paris climate pact, and that he will seek to renegotiate the international agreement in a way that treats american workers better. pres. trump: i am willing to immediately work with democratic leaders to either negotiate our way back into paris under the terms that are fair to the united states and its workers, or to negotiate a new deal that protects our country and its taxpayers. emily: the tech industry has already responded to trump's announcement. tesla ceo elon musk announcing his departure from the president's council with a tweet saying, "i am departing the presidential council. climate change is real. leaving paris is not good for america or the world." we spoke to colleen regan from the bloomberg energy finance team and david kirkpatrick about the impact of this decision. david: the gap between president

trump and silicon valley is a grand canyon at this point, but i think what is more interesting to me is the question of how committed business has become, not just silicon valley, but most big businesses in the united states towards climate change remediation. the issue of whether climate change is happening or not is not really controversial among most business leaders. it is accepted as much of your reporting has already suggested. and so you know, clearly, a lot of progress is going to still be possible even without the u.s. in the paris agreement, despite the fact that everyone agrees it is a stupid, stupid thing to pull us out. emily: let's talk about this, colleen. how are tech companies and broader u.s. businesses actually going to respond, in action rather than words? colleen: great question, emily. so we have already seen action out of silicon valley from these tech companies. if you look at just what is called the tech amiche, amazon, google, microsoft, they got together in defense of the clean

power plan in 2016, and we have seen them repeat that climate change in their view is one of the most significant issues facing our generation globally, and they are actually putting action behind these words. so they have set, all four of these companies which represent $2.5 trillion of market cap, have all set 100% renewable energy goals. they want to source all electricity from renewable energy globally. and in fact google came out on record saying they are going to hit that target in 2017. we saw amazon be the number one procurer of clean energy in 2016 in the united states, and apple is even signing deals for wind farms in china for clean energy for their suppliers. they are very much behind this. and is not just words. they are really taking action. emily: china meantime has reiterated their support for the paris agreement. i wanted to take a look at the bloomberg. we have a map of the solar plants across the country.

the green shows plants that are already in operation. the yellow shows plants that are planned. how does this map change in five years as a result of this, or does it? colleen: that's a great question. in some ways, i think you would expect to see that green appears even more heavily in those states in which solar is already very concentrated. we are seeing, it is important to talk about what is going on on a federal level, but equally important in the u.s. to be thinking about what is happening on the state level, too. just yesterday, the californian senate passed a bill to get 100% renewable energy by 2045. that still needs to make its way through the assembly, but there is absolutely activity going on at state level that will continue to drive wind and solar build. at the same time, we have seen costs fall dramatically, which means it is becoming more economic to install solar in more areas of the country. so just from 2008 to 2016, we saw the cost of pv modules, only

part of the panel, but the cost of pv modules fall by 90%. this is helping more states to actually invest in solar as well. emily: now, david, you know, president trump is saying he's trying to protect american jobs. on the other hand, there are concerns about jobs in clean tech, jobs in new energy. are we ceding this potential big market opportunity to other countries like china? david: absolutely. i mean, i think it is widely believed particularly among people who have a sort of future centric view which one would hope is most business people, but there is a massive long-term business opportunity in remediating climate change. it is also like i was thinking before. if you think about what world war ii or what wars due to motivate a company or country to really gather all its energy together and make rapid progress or look at what the depression did to create the wpa and all

the infrastructure that we created. facing a crisis can be one of the most motivating things in the economy, and it is happening in china right now. that they look at it that way, and they are really, really aggressively moving forward on remediation technologies across the board, with solar being a leading example. i want to just quickly point to another thing that is really relevant to the connection between tech and industry and this decision. in most states where they operate, tech companies are the number one power consumers, because cloud centers are such a gigantic consumer of power. there was an article not long ago about -- even in west virginia, the coal state, the utility there is now shutting down coal plants and putting in more renewables, partly because microsoft and other companies are their biggest customers, and they are saying, we want renewable power. emily: that was colleen regan of bloomberg new energy finance and david kirkpatrick. coming up, another wild week for uber.

the startup fired the star engineer at the center of its bitter dispute with waymo. the head of finance steps away from the firm. and the electric car market has been growing in fits and starts for years. but could the chevy bolt be the tipping point for the industry? we will hear from one analyst literally who ripped up the car to find out. this is bloomberg. ♪

♪ emily: amazon crossed a major milestone this week. the stock traded above $1000 a share briefly for the first time ever on tuesday and has since hovered just below that price. the company has been wooing investors with dominance in online commerce and cloud computing. the stock is up almost 40% from a year ago, outpacing the broader market. meantime, some frazzled parents might get cash back from amazon. the tech giant will refund customers whose children made unauthorized mobile app purchases between 2011 and 2016. the federal trade commission ruled that amazon made it too easy for children to make purchases on mobile games.

the ftc's decision ends a three-year legal battle. the refund amount could top $70 million. it was another eventful week for uber. the company announced its revenue increased $3.4 billion in the first quarter, despite thousands of people deleting the ride hailing app from their phones. they also said that head of finance will leave to take a position at another startup. but the most explosive development the week was the sacking of anthony levandowski, the former head of its self driving car efforts. he is also the man at the center of the battle between uber and alphabets's driverless car unit, waymo. remember, levandowski was recruited by uber after a long stint at google. waymo sued uber earlier this year, alleging that levandowski stole patents for the development of self driving technology, then used them at uber. levandowski invoked his fifth amendment right not to testify, which has made it more difficult

for uber to defend itself. we spoke about this with our bloomberg tech mark bergen and our bloomberg tech senior executive editor brad stone. mark: this is really about 14,000 files, files that were allegedly and surreptitiously downloaded by anthony levandowski from waymo. judge william alsop said levandowski had to turn over those files. uber told its employee levandowski he had to turn over the files and he declined to comply, perhaps because something about them was incriminating. so you know, it is interesting, it turns what has really been a two-party case into almost a three party case right now. we now have waymo versus uber and anthony levandowski now off on his own. emily: how does this impact the case? does this hurt uber's case or help waymo's case? brad: it's hard to say. they are waiting for whether or not this will set the criteria the judge has set up for the injunction. the judge could say, uber, you fired levandowski. we don't have any evidence.

he said previously that waymo's case was strong, but he said there was no "smoking gun." so it seems like uber's lawyers probably know what they are doing. this might be good for them, but right now it is really unclear. emily: and is there any chance levandowski could be personally prosecuted here? mark: i do think there is a criminal case proceeding. he also has a prior case waymo filed against him prior to the february lawsuit against uber. he has hired his own lawyers after that lawsuit. they are criminal defense lawyers, so that is a likelihood as well. emily: now brad, levandowski argues he has been forced to choose between his job and his constitutional rights. does he have an argument there? brad: i am not a legal expert, but you know, but perhaps. emily: uber's driverless car future, what does this mean? they have already taken him off as head of the unit. did they really need him? brad: there is a deep bench of

talent. you have eric may offer who is now replacing him as the head of the driverless division. he came from carnegie mellon. they hired other folks. they have the man from the university of toronto started the ai lab in toronto for uber. you know, the risk is the optics of this look so bad that it is going to be increasingly difficult for uber to hire folks, and of course talent is the name of the game right now. emily: there is a public trial on track for october. what is next here? mark: i do think to brad's point, self driving cars are not necessarily on the road tomorrow. experts say they are years, if not decades, away. so there is a chance that uber might turn more into a partnership model. we see it is partnered with a few carmakers, they might try to reach out to more carmakers, something that lyft has done, and lyft is also in talks with waymo on a partnership. for this case, we will see a lot

of movement later this week. uber also has the massive investigation into their harassment issues. maybe this is a way to put this on the back burner and deal with a lot of other cultural issues facing the company. brad: yeah, let me just have one thing. there is always the possibility these companies settle. google is an investor in uber. there are reasons for them to work together. it does appear from a distance that this case has been about the founders of alphabet, larry page and sergey brin, with a personal vendetta against one of their former employees, anthony levandowski. so now that he has separation from uber, perhaps it is the beginning of uber and google, you know, coming back to the side of being allies versus adversaries. emily: interesting. the uber ceo got some sad news of the weekend. his mother, bonnie, was killed in a horrific boating accident and his father is in serious condition. our hearts go out to travis at this time. i do want to ask, brad, uber has a lot of challenges on its plate right now. the sexual harassment

investigation, the results are coming this week or next week. are we expecting any delays? brad: you know, as far as i know, no. eric holder the attorney general was due to deliver his report to the board of directors. it was not expected that the report or at least a redacted version of it would become public until next week. i don't know how much it will slow down the investigation. emily: do we know anything yet about which way the investigation is leaning? brad: no, we know very little, other than he talked to many many hundreds of employees, he delayed the report at one point because of the response he had gotten. i expect it will be tough for uber. emily: how have all of these issues piling up impacted the uber brand? brad: you know, in the tech community, perhaps in the investment community here in san francisco, very much so, you step outside the bubble and go to another city, another country

and uber is an increasing part in people's lives. not just uber, other ridesharing company's too. it is this weird paradox where the brand has been hurt, hiring has probably gotten more challenging. inside uber has got to be a very difficult time, but this is a service and a company people love. they have made a bigger part of their lives. emily: that was bloomberg technology's brad stone and mark bergen. the story we are watching, it has been revealed two former theranos directors did not follow up on allegations surrounding the validity of the technology used at the blood testing start-up. gary russhead and george schultz said in depositions they did not need to question the company's founder elizabeth holmes about the matter. remember that both men left the board in 2014 after a wall street journal investigation highlighted employees' concerns about the company operations. the annual report this week. we will dive into what has

become essentially the state of the union for the tech industry. this is bloomberg. ♪

♪ emily: nest labs has finally ended an 11-month product drought. the latest gadget is a revamped, high-end security camera called the nest cam iq. it is the first redesigned camera since the start up acquired startup dropped the camera in 2014. it shoots higher resolution video that allows users to more deeply zoom into footage without losing as much clarity as the current version. and the camera lens will automatically pan to follow a person in the view as they walk around the room. mary meeker unveiled her widely followed internet trends report for 2016. the 355-page report covers everything from the cloud and internet advertising to wearables and music subscription services. a major takeaway from the report, the rise of online ads. with global internet advertising

expected to pass tv in six months, and google and facebook reaping the benefits with their combined share of online ads amounting to a whopping 85% and rising. we dug into the findings with bloomberg intelligence u.s. director of research paul sweeney. paul: we are seeing the trajectory over the last, really, last 10 or 12 years where we have tv ad spending growing about 4% to 5% a year, but digital ad spending growing 15% to 20% a year. the lines are just about to cross this year, and if you look at the forecast over the next several years from various forecasters, continued upward trend in internet ad spending, again double-digit growth versus television in the low single digits. emily: so what does it mean for everyone else if facebook and google are getting the lion's share of the pie? paul: yeah, if i am an advertiser, i am worried, because i have a market where there really is a duopoly between facebook and google.

i only have two buyers, two platforms to allocate my ad dollars. that is not a good market structure, market dynamic. what we are seeing is of the incremental ad dollars going to the digital marketplace, again, google and facebook are taking just about everything. it is really a challenge for some of the smaller platforms, think twitter, think snapchat, you know, having 300 million, 400 million users on your platform these days is not enough. when you take a look at google, when you take a look at facebook, each of facebook's platforms is at or above one billion users, when you think about facebook and instagram and message. so it is just a tremendous reach vehicle, and what we are seeing is these big platforms like google and facebook are really starting to target television advertisers, because that is where the money is. emily: something else that meeker called out is the measurement of the impact of online ads is very much lacking. also, the placement of ads is

sometimes rather suspect, perhaps they might pop up next to offensive content. what do you make of some of these potential headwinds? paul: these are significant risks, and they are highlighted by not only advertisers, but the ad agencies that represent them. measurement and context and placement are really the two big issues that these internet companies really have to figure out. that being said, the dollars are still going to digital. what is interesting, we are going to have a big data point coming out of the television industry over the next couple of weeks, when they sell about 75% to 80% of their inventory of what is called the upfront market, and you know, $18 billion or $20 billion will be allocated to television. the expectation is that tv ad spending in the upfront will be flat or down. think about facebook and google. they are seeing their top line advertising revenue grow 20% plus. you just have to compare those two markets, and you can see where advertisers are going despite some of their concerns.

emily: on a slightly different topic, she also called out amazon and talked about how it is changing the face of retail, which we know, but mary meeker specifically pointed to amazon baby wipes, amazon batteries, these are products that amazon is branding itself and selling to consumers. what impact is that having on the retail landscape? paul: it is having a big impact. i think, you know, when you get to private branded products, it just shows you the strength of amazon in the retail marketplace. not only have they disrupted the entire bricks and mortar retail, but now they are really starting to think about how they position themselves within the retail market in certain verticals. when you think about amazon, jeff bezos has shown really over the last 20 years he will make any investment that he thinks will grow his business long-term because obviously he believes that retail sales going to online will grow from today's average of about 7% or 8% to well over 10%, and he needs to be a part of that and be a leading player there.

we have seen this company make tremendous investments across their businesses because they believe in the long-term story. emily: that was bloomberg intelligence's u.s. director of research paul sweeney. waze is expanding across california. alphabet has been testing a service here in san francisco and in israel and plans to launch in brazil. its ridesharing platform operates more like a traditional carpool where the driver and passengers have similar origins and destinations. unlike uber and lyft, where drivers pickup and drop-off riders wherever it is requested. we spoke with the head of carpooling at waze. caroline: hello. joshua: hello. caroline: what a nice ride. joshua: thank you. caroline: happy carpooling. joshua: yeah. caroline: how many people are using this already? joshua: so tens of thousands of people have registered. they have two app platforms.

on the riders' side, tens of thousands of people have downloaded that app. we have thousands of carpools happening every week in the bay area. caroline: why are people using waze already in terms of carpooling? what is the need of it? is it work, is it play? joshua: we are trying to connect commuters who either don't have a lot of options or are tired of driving, or have limited parking at their workplace. we are connecting commuters who are going in the same direction and who have similar origins, similar destinations, they are neighbors, they are friends, they are colleagues, and simply taking cars off the road. caroline: and what about the money exchanging hands? how much are you getting reimbursed for taking me? how much am i paying you? joshua: sure. so it is a not-for-profit share the expense carpool. these are not actually for profit drives like ridesharing. so you would get as a driver up

to $.54 a mile, which is the federal limit on gas and expenses for driving, and the rider will pay no more than that as well. so for you know a 10-mile ride will probably be about a five dollar exchange rider and driver, and waze is facilitating that. so as a rider, you give us your credit card number. as a driver, you register your account. we do the transaction behind the scenes. caroline: why else is waze doing this? is it not making them money, or is it? is it the data? joshua: obviously there is a financial component. today we are not taking any commission on matches, but at some point when we reach higher density and our quality of service is where we want it to be, we can take a small commission off of every match as well. caroline: and the data you are getting out of it, where is that of interest? joshua: definitely data is important to waze. the more people that are using waze, the better it gets for everyone. so with something like carpool where we can tell where your home and where your work is and

your regular sort of commute patterns, that helps us with routing for everyone. that helps us tell cities that we work with, here are your origin places of density, your destination places of density. we work with i think 250 different cities around the world to help them solve their traffic problems. caroline: how does it play into the greater scheme of alphabet as well? joshua: at this point, we are not working directly with any other entities. it is very much a waze product. and something we hope is important for the future of waze. caroline: how is the competitive landscape? joshua: at this point, it is early days. there is a few startups working on carpool. lyft and uber have experimented with true carpooling models. but they haven't really stuck. emily: that was joshua reed and caroline hyde. coming up, the man who was the mastermind behind android has unveiled his latest creation. we will find out why essential believes there is room in the

market for yet another smartphone. and a reminder that all episodes of bloomberg tech are live streaming on twitter. check us out @bloombergtechtv at 5:00 p.m. in new york, 2:00 p.m. in san francisco. this is bloomberg. ♪

♪ emily: welcome back to the best of bloomberg technology. i'm emily chang. andy rubin is back in betting big on a big new smartphone. earlier this week, the creator of the android unveiled a new product from his new company, calling it the essential phone. essential has some serious competition with tech giant apple and samsung dominating the market, but rubin believes his company and product will have the it factor to appeal to the masses. we found out from the president and coo of essential. niccolo: premium materials, craftsmanship, and passion frankly are what we are bringing back. emily: you don't think apple has that? niccolo: i think there has been a little bit of incrementalism the last few years.

there is a bit of a board room factor setting in. we've got a very distinctive device, obviously. it's got the first ceramic titanium enclosure. we have got the biggest screen and the smallest formfactor. and we've got an excess report in the back with the world's smallest 360 camera that can just snap straight on the back. what i think is going to happen with our devices, it is going to evolve with you. it is going to allow you to make your phone more meaningful and powerful overtime. we will focus on significant innovation at all times, and only significant accessories. this device for example we are selling for $49.99. it will not only democratize 360 video access, but it is something that's affordable that you can bring with you at all times, and you can capture any important moments, whether it's a sporting event, a musical

event, your kids' first steps. emily: this is your first hardware company. what are some custom components in the phone? niccolo: its enclosure, materials. we're the only premium product using premium materials. we are not marking up our building materials by a factor of three. we think we need to be a proconsumer brand that uses our materials on our phones, and we need to have devices at a great value proposition. our full display is the first rounded screen. we have our camera notched through the middle of it. and ultimately, you can think about what we're doing in the rounded screen. long term of this device by looking at the back. we are using a fingerprint sensor on the back. we have an internal camera with a black and white fusion color system. and our next device will actually swallow the edges up. we are almost basically bevel-less at the moment. because of the titanium. we have thinner edges on the device than anybody else. and frankly, it's distinctive. i just say we are bringing back

the cool factor. emily: what sort of software customizations are there on top of the android base? niccolo: we are actually going for purest, cleanest, simplest android. so android's operating system has been around for a while. 85% of the market, and we think we know how to take advantage of it better than any other firm in the market. we trying to, frankly, unleash the full power of the pure android operating system. emily: will third-party accessory makers be able to make things for the connector on the back? niccolo: they will. we are big on open ecosystems. there will be a developer network around that. our android ecosystem play will have no preloaded apps, minimal preloads, because people want choice. but i think you are right. we are going to be able to turn the back into a real standard in the long-term, a hardware developer network. emily: so the home operating system, ambient os that you are also putting out, the idea is to be a connected operating system

for the home. the connected home has yet to take off. when will it? i mean, what do we need to get there? niccolo: that is a good question. andy and i believe that the home is at the same stage of development as the phone was in 2004 when we started android. we are intent on the next five to 10 years on building out that horizontal plate. i think in developed nations, it will take us the better part of a decade for us to go from single, really just digital appliances is what we have in the home. we are trying to build the first device to help you choreograph your home, and we are doing that without being another walled garden. emily: so you think android is just fine. will you ever build your own phone os? niccolo: never say never in the long run, but in the short run we think there is a lot we can do to add premium hardware to a great operating system, and we feel that no one has ever done full justice to the android operating system with the hardware. we are a hardware business when it comes to the phone and the

360 camera. we are a software hardware full stack on the home. emily: so apple is launching a siri speaker, home speaker to take on home and amazon echo. what does amazon bring to the market, or is it too late? niccolo: we are where the phone market was in 2004 and 2005, just scratching the surface of capabilities. there will be a lot of change. one of the things that andy and i are passionate on is believing in the long run that consumers want stuff to work and they want to be able to buy whatever point solutions they want. we don't think the winning model is going to be, you have to use all my stuff or we won't play well together. we want to provide that horizontal layer that allows you to pick out whatever you want for your stereo system, your tv, your lights, your front door lock, your baby monitor. think about the long tail in the home. it is much longer than the mobile device market was. there's a lot of sentimental value still to come. emily: that was niccolo de massi, essential president and coo.

ahead of the release of the tesla three, the auto team at ubs got a hold of their biggest competitor, the chevy bolt. not only did they buy the car, but they took it apart to give a comprehensive breakdown of the features. colin discussed what they found under the hood. colin: we partnered with a team that we call the evidence lab, a bunch of data scientists, and we talked about how the chevy bolt will be the first mass-market ev with over-200 mile range. this will be a very interesting test for ev's in the u.s. and globally. since it is such an important vehicle, we decided to partner with the company who is an expert in automotive teardowns and provided us a very detailed cost analysis of the entire ev powertrain, which i think gives us, but you know, a unique edge in understanding this important phenomenon in the industry. emily: give us the highlights on how the bolt compares to the tesla model three. colin: we will get full details of the model three, that they

are a similar price point. the base tesla model 3 will be $35,000. the bolt with base will be more like $30,000. so it is similar price points. the range will be very similar, both will be over 200 miles. so they are very interesting to compare. obviously, tesla is more upscale when we compare the two. we put a little more cost on the powertrain. we assume they will have a nicer interior. given the price point, it is probably going to be more like $42,000, $43,000 with all the options, which will be sort of closer to a bmw three-series. emily: you guys estimate gm is losing $7400 on every car. there are estimates that tesla will be losing $2800 on every model three. how do they stem these losses? how do they close that gap? colin: the big driver is going to be battery cost. also today realize we are assuming gm is only going to

sell around 30,000 bolts a year. a very low number. so the r&d costs are really spread off over a lot of units. the big driver going forward is going to be that their battery costs are going from over $200 per total kilowatt hour today, and we estimate it will be around $130 per kilowatt hour. there are massive declines in battery costs that are a key driver. we are also assuming there are certain components that have a good step function coming down on the ev powertrain that will also help in above-average cost decline on the ev powertrain as well. so that narrows the gap from a $9000 cost premium today to just a $3000 or $4000 cost premium by 2025. when you contribute that to the total cost of ownership, lower fuel, hopefully lower maintenance, the economics, particularly in europe when gas prices are a lot higher, starts to make a lot of sense. emily: what is your projection for the growth in the ev market in general as a result of the bolt? colin: yeah, i mean we raised

our global forecast, because we did find that the costs are lower than we expected, and we do expect battery costs to accelerate. and a lot of experts we talked to around the battery. so we are expecting by 2025 about 14% of vehicles globally will be ev's, a very high number i think compared to other estimates. a lot of that will be driven by europe with about 30% penetration in europe, and in the u.s. we are a bit more conservative. we expect only 5% ev penetration. we look at it with much lower gas prices. this is going to be more of a luxury vehicle. we know, and one of the reasons we are cautious on tesla, is we know all the german luxury guys will be coming with their own ev's in the 2020's, and that is mercedes, audi, porsche. the competition is intensifying on the luxury side. emily: as more companies produce electric vehicles, what does that mean for the auto industry at large? colin: i mean, it is going to be

a very important transformation. when you think of the automakers, the whole engine is going to be sort of overhauled here. that is going to be a difficult and challenging transformation. at the end the day, we do think the return on investment capital for the automakers will be very consistent with what we have today, and i think there's a very important role for the traditional automakers in the future. so the supply base, we highlight some names actually should benefit from this. we highlighted in our report, you know, delphi has really good content, lear has good content on ev. more content really than they have on an internal combustion engine. it could be a positive if you are a well-positioned supplier. emily: any idea when chevy will be making the car more widely available and with less of a focus on california specifically? colin: i don't have any official news. i assume it will be ramping production like most vehicles throughout the rest of the year. it only launched in the fall. emily: that was colin langan, the auto analyst at ubs.

coming up, bitcoin has been on a tear, surging more than 100% in the last two months. we will discuss what is behind the move in the crypto currency next. this is bloomberg. ♪

♪ emily: intel has escalated the battle against rival amd in the market for high-end personal computer processors. the company unveiled a new, more powerful chip. intel will begin selling chips under a new core i-9 brand aimed at gamers. the company's only competition in pc processors, amd, says its latest product has outperformed intel chips. bitcoin has risen more than 100% in the last two months. but critics say the digital currency is showing signs of a bubble. in the last week, bitcoin hit an all time high, only to slump back down.

it is this kind of volatility that gets bears worried. not to mention questions about safety, pride, lack of government supervision, and competition from other digital currency. we spoke with poly chain capital founder and ceo olaf carlson-lee. poly chain is a hedge fund that is backed by union square ventures, as well as our bloomberg editor at large, cory johnson. olaf: we have seen really fast growth in bitcoin recently. i think this is an uptick coming from an industry that hasn't been moving as aggressively in the public radar. but down that growth in the price is more closely tracking to fundamentals, i think we are seeing a big uptick for that reason. emily: corey, some investors have told me that bitcoin is like gold, a finite resource, and therefore just not as interesting. what is your take? cory: i think gold is fascinating personally, but it's true that the way that point is constructed is meant to be finite and harder and harder to mint as there are more and more out there.

the scarcity value is an important part of the bitcoin plan, and has been from the very beginning. but i think for people in the bitcoin community, they see all this investment, they see all this excitement, they know all these deals, they can't believe their parents don't understand what they are doing. they see the price served as a validation of what they have all been working on. but there is absolutely an element of gold like fervent belief and rabid speculation going on here. you can see that in the reaction of price. and when you showed the five-day chart, five days ago, when you saw that really dramatic one hour selloff in bitcoin, you can really see it is so speculative, this current wild ride that bitcoin is on. while the long-term value of bitcoin may be in the eyes of the beholder, the volatility is really in the eye of the speculator. emily: i have been talking to investors who said bitcoin is old news. the new hot cryptocurrency is something called ephirium. in fact, i interviewed craig

wilson for his prediction for the year, and he had this to say about cryptocurrency in general. take a listen. craig: i think that ethereum will bypass -- the market cap of ethereum will bypass the market cap of bitcoin by the end of the year. emily: so of all the predictions he could have made, about anything, that is what he chose. olaf, first of all explain how bitcoin and thereum are different. olaf: bitcoin has programming language that you can use to interact with the protocol as a developer. it is very limited programming language. in ethereum, it is much more expressive. what we have seen in ethereum is a much richer organic developer system developed very, very quickly. it is much more aggressive than bitcoin. emily: would you agree with what fred had to say? olaf: yeah, i would agree with fred.

emily: you think the market cap is going to replace -- olaf: i don't know if i would agree with as aggressive a timeline as fred, but in the long-term, absolutely. emily: how long? olaf: i would extend that out one year, made by the end of 2018. emily: interesting. cory, what are your thoughts? cory: i think ethereum is is interesting in the way it uses a network. it's more like a pc ip than the client/server method or model. i think it is fascinating from that regard and could have interesting use cases, still using the bitcoin -- the general concept of block chain. but it is harder and harder to use bitcoin, and one of the issues that a lot of people are talking about is that in the bitcoin world is how hard it is to close a transaction. the speed to close a transaction in bitcoin is getting exponentially worse.

and it's been happening interestingly coinciding with the big rise in the price. it is just hard to do a deal in bitcoin right now. we have a chart that shows how long it takes to get confirmation on the bitcoin network of a bitcoin transaction, and it is getting slower and slower. that may be a problem embedded into the actual coin itself, so that the bitcoin can't get out of its own way with this problem. there's been a lot of discussion of this problem for some time well over a year in the bitcoin community, but the fixes haven't worked, and the proposed fixes are challenging the very nature of bitcoin, so unless a solution is found, i think there is going to be a real problem in the face of bitcoin's ascendancy, because the transactions, the deals can't get done. emily: what about the safety issues, olaf? we just covered this big to be a real problem in the face ransomware attack, and the attackers were asking for ransom paid in bitcoin because of the anonymity. will that change? olaf: well, you know, i think these technologies offer a whole

new suite of use cases that were not possible before. that includes both good actors and bad, just like the internet enabled both good and bad people. emily: are there any other crypto currency we should be watching? olaf: oh, many others. would you like to know what they are? emily: yes, i would! olaf: i very much like ethereum tokens, which are built on top. i also am a pretty big fan of some of the more novel types of signatures. things like zcapture. emily: when do you think these are going to go mainstream? i mean, when will the average novice consumer be paying for things in bitcoin or ethereum? etehereum tokens, whatever it is. olaf: we are still in the infrastructure building phase before we are ready for user-facing applications. but i do think within one to two years, we will start to see the first viral applications that are user facing. emily: that was probably chain capital ceo olaf carlson-lee.

coming up, box is standing out in the credit allowed space and generating cash in its coffers. we will hear from ceo aaron levie about the company's latest earning results in the goals ahead. as you like bloomberg news, check us out on the radio. you can listen on the bloomberg radio app, and in the u.s. on sirius xm. this is bloomberg. ♪

♪ emily: to keep up with competitors, microsoft is giving skype a makeover. the new app has all the features users know, while adding third-party services, simpler photo sharing, and a revamped interface for group chat. skype has taken a backseat to the convenience of snapchat and apple's imessage. the new skype will be released gradually, starting out with android devices, then on the iphone in about a month. it was a banner quarter for cloud content management company

box. positive earnings results helped pushed them to a 52-week high. two analysts raised the price tag on the company. investors were particularly pleased box maintained its goal of being cash flow positive, a big challenge for a tech firm looking to grow. we spoke with box ceo aaron levie about the results and what's next for the company. aaron: make sure we are plugged into different applications our customers are using. if you are using facebook for the enterprise, which is their new workplace product, we want to make sure content can be served up securely within that environment. if you are using ibm's workflow technology, we want to make sure we can plug into that software very seamlessly as well. if you are using slack, we want to make sure box can be the backend system for that content. so really any application that gets created or used, we want to if you are using slack, we want make sure we have deep integration to power the content management and underlying data management within that app. partnering is fundamental to our strategy.

we are very excited that in the past year we have some expansive partnerships with companies like microsoft, google, ibm, and many others. these are very core to our strategy. emily: how does now being free cash flow-positive impact the business? aaron: yeah, i think this is obviously one of the biggest questions that wall street had when we were first going public. you know, we were growing very quickly, but at the same time we were burning a lot of cash. the big question was what was this business going to look at at scale and what was going to be the convergence point? we told the market that q4 of fy 17, so that was our january that we just kind of came through, we said we would be cash flow positive in that quarter, and we did achieve that. that was what we have guided wall street to. now for the full year for fiscal 2018, which is the year we are in right now, we also guided that we will be cash flow positive full-year basis. really what this means is obviously, we don't have to raise outside capital anymore because we are now generating cash.

we have over $200 million in the bank. so that is really positive. i think more importantly, it shows that as we are growing still pretty rapidly with 30% growth on the top line, we are generating a very, very healthy core business model and we have very strong and healthy economics at the foundation of the business, which obviously is incredibly important to just running our company, but also equally important to wall street's understanding of what we're building. emily: you have been critical of president trump. when he was a candidate last summer, you signed a letter along with 100 other tech leaders saying he would be a disaster for innovation. box shares are up 30%. has trump been the disaster for innovation that you expected him to be? [laughter] aaron: i would probably separate our business performance from some of the policies that have been enacted. i would say as it relates to a tech innovation and the innovation economy, we really haven't gotten much of a clear message from this new administration about what they

believe are going to be the defining factors over the next decade and coming decades to really truly driving a high innovation economy. that would range from things like high skilled immigration, stem education, digital policy issues like encryption reform, patent reform. so you have a lot of issues where they are still -- it is still really unknown what the administration's viewpoint is on these major issues that are going to be not just fundamental to the tech sector in silicon valley, but really the broader economy as more and more of our economy moves into the digital age. so i think it is still very, very early, and unfortunately we haven't seen some of the policies that we would like to see that would drive innovation forward in a much longer term picture as opposed to just the past, you know, 100, 140 days or so. emily: what about climate change? what are the biggest threats to the tech industry with regard to trump's stance on the paris accord? aaron: i think we have a real risk in things like climate

change, immigration reform, and the travel ban. when you look at things like internet policy where we have historically been a leader around the world in setting the tone and sending a message to the rest of the world about really what we are going to stand for, what our philosophies are going to be as a country. emily: that was aaron levie, ceo of box. and that does it for this edition of the "best of bloomberg technology." we will bring you all the latest in tech throughout the week. this wednesday we will sit down with meg whitman, hewlett-packard enterprise ceo, in an exclusive interview. tune in for that conversation at 5:00 p.m. in new york and 2:00 p.m. in san francisco. remember, all episodes of bloomberg tech are now live streaming on twitter. that is all for now. this is bloomberg. ♪

>> welcome to bloomberg businessweek. in this week issue, by the irs is demanding two billion dollars and businessweek's interview with john williams. finally, we will tell you the song of the summer and justin bieber. all that had, on bloomberg businessweek. ♪ >> we're here with "bloomberg businessweek" editor in chief. let's talk in the politics section. we heard promises along the campaign trail. that donald trump was not going to touch social security. he said he's got a big heart. turns out that there's going to