>> i am alisa parenti and washington. you are watching "bloomberg technology." your firsteck of word news. president trump will spend christmas at his florida estate. his first major legislative victory, tax reform. trump also endorsed ron desantis , calling him a brilliant young leader. dozedozens of president trump's nominees for key positions in federal agencies will remain in limbo until after the new year. that includes jerome powell, who was not confirmed to before the senate adjourned. those nominations will return to the white house. the president will have to

renominate anyone he wants installed. steve bannon and corey lewandowski have been asked to testify before the house intelligence committee. the panel is investigating russian interference and the 2016 election. neither one has responded. and the worst appears to be over for a massive wildfire that plagued the southern california coast for two weeks. mandatory evacuation orders have been called off. at its peak, it drove about 100,000 people on their homes. global news 24 hours a day powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. i am a alisa parenti. this is bloomberg. and more of "bloomberg technology" is straight ahead. ♪ ♪

emily: i'm emily chang and this is "bloomberg technology." coming up, bitcoin bears the bubble theory. prices come crashing down. our deep dive into the four day selloff. plus, validating and apple urban myth, the real story between older and smaller iphones and he the lawsuits starting to pile up. the battle between two chipmakers. qualcomm's attempt to avoid a hostile takeover, and a proxy fight spilling into 2018. but first, bitcoin investors may be having a reality check. the cryptocurrency fell almost 30% friday below $13,000. bitcoin has lost close to 40% this month, but it has still risen more than 11 fall this year. coin based said all buying and selling was disabled after

having delays in processing wire transfers and verifying new customers for the past week due to higher traffic. these issues reignite the question, are we in a bitcoin bubble? joining us in new york david kirkpatrick. also, cory johnson. let's start with what is going on in bitcoin this week. >> i created a bitcoin monitor on my screen and i have been monitoring a bunch of stocks as well working on a bloomberg news story coming to a bloomberg terminal soon. check that out. emily: i will. >> today was weird. i cap noticing the price looked like it was up for me today. and since this morning, since the beginning of trading today, it is not a stock, bitcoin is up, and it is up it today, 24% comes since 9:30 this morning new or time. basically since i've been awake

today, bitcoin has been rallying after a selloff. i think it highlights the enormous volatility that is still extant in the trade of bitcoin. added to that, a lot of equities that have been formed around the idea of blockchain and bitcoin. despite the futures contracts trading inside chicago. emily: yet, you still have the skeptics. the hedge fund manager had this to say about his bitcoin plans. take a listen. >> this is a bubble and there is a lot of fraud mixed in. there is a lot of froth and fraud in anything that is as exciting as this. i think this could become the biggest bubble of our lifetimes. >> i want the record to show i didn't say that. >> mostly because it's so global. emily: he also says he is shelving plans for a cryptocurrency hedge fund. david, look, where do you fall?

i have asked you every week where you fall. after this week, where do you stand right now on bitcoin? david: my basic views have not changed, but it's very important that someone like him that is a well-respected investor and who been usedusiasm has is now sayinger it could be the biggest bubble of his lifetime. i think that is a healthy thing, because what we have here is something that is almost certainly going to be worth a lot at some point, but there is no objective reason why it should be worth any given amount at any given moment in my opinion. people say it could go to $1 million people throw out crazy , $400 million. numbers, and any one of them is equally valid, including zero. until bitcoin settles down and er what if clear

anything it is used for in the world, i think the volatility is a consequence of genuine uncertainty about what people are buying, and that will continue. emily: nobody knows how to value it. could be zero? any prediction could be valid , which is to say every other prediction is invalid. which is to say any prediction is invalid. that is the case. the idea of what they price will be before we have fully functioning usage of bitcoin is nuts. ,t is pierced speculation particularly as you see a lot of retail accounts. not understanding what this can be come out looking at volatility. i joked i should of put my kids'college funds into bitcoin a few months ago, but that would be foolhardy. ,here is no underlying value but in terms of intrinsic value, it doesn't exist.

just as intrinsic value in things like gold and silver don't exist. the intrinsic value is an in the eyes of the holder. as warren buffett has pointed out, all the gold in the world would be far more productive than all of the farmland in the world. emily: what you think of companies adding blockchain to the name or buying blockchain companies or getting into the currency in general because they think it is the hot thing? you mean like long island ice tea that became long island blockchain yesterday going up because they changed it. what is happening is people are getting irrationally excited and to use the word "greedy" in hopes of short-term gains and they are taking advantage of mass psychology. onhich is trying to get in

what seemed like a sure thing for about five minutes. cory could have done a great job with the school fund if he invested at 9:00 this morning and sold as the show was starting. emily: if there is money to be made, why not? >> if you have an incredible stomach for rapid volatility and risk, i think that is fine. it is a harder thing to trade in and out of than some investable items. i'm not -- i continue to think ordinary people, people who are just trying to protect their long-term financial future should not be investing in this thing. i do think long-term it is a his historic transformational technology that will have a lot of value. will it have a millions of dollars or bitcoin in value? i don't know. it will have value. cory, with the crash we have seen this week, is this the beginning of something or is it just going to continue to go up in the new year? cory: there have been massive

price falls and rises in bitcoin , morethe very beginning than 20% over and over again with this currency. it looked like we hadn't seen one in a while, but in a week down 19% is not remarkable for bitcoin at all. one would have thought the futures contracts would have provided more grounding around that, the ability to be long and short, the ability to predict prices in the future. what is interesting is that the futures contracts are predicting them in their first monthly expiration next month a much lower price in bitcoin. we will see if there is more trading around it and how many new coins will be minted. there is a limit on the total number of coins ever created in , and that has people believing the will be some ultimate scarcity, but scarcity doesn't always provide value. emily: what questions are you going to be asking and exploring

going into the new year? cory: two things. the silly stocks we are talking about, i'd love these stories. you want to look at the market cap. this long island iced tea thing, who cares? a couple of companies have market caps over $1 billion. i think they are extraordinarily risky for shareholders and there is a lot of money in and around these things. emily: some of these are multibillion-dollar companies. cory: they are worth examining, but that is separate from the use of blockchain. the usefulness of blockchain will be interesting going forward. i think the ultimate solution day tradee currencies, trade stocks using bitcoin technology, if we ended be ath stocks, that would dramatic change in the way wall street works. emily: all right. cory johnson, thank you. david kirkpatrick, my guest host

for this hour, you are staying with us. a morgan stanley director is leaving the company to join a cryptocurrency trading firm. wayne trench is set to join octagon. they trade bitcoin and cash for clients. also moving to the same company is an hsbc exec. the moves calm as trading builds momentum among investors and products are lining up for regulatory approval. coming up, hawaiian apple customers are heading to court over complaints of slowing iphones. that is next. "bloomberg technology" is live streaming on twitter. check us out. this is bloomberg. ♪

emily: a california judge has sanctioned apple in the federal trade commission's lawsuit against chipmaker qualcomm. the judge says apple has been withholding documents related to the case sends a deadline, resulting in funds of $25,000 a day. apple is not a party, but has its own legal action pending against qualcomm. sticking with apple, iphone users have taken their complaints to court, infuriated by an apple software update that slow down the operation of their smart phones. at least two customers sued apple over the deterioration in their phone's performance. apple acknowledged this week that it issued an update that slowed down iphones with the dying batteries designed to help people get more out of their aging batteries and reduce occurrences of shutdowns, according to the company. customers don't seem to be buying it. joining us from minneapolis,

longtime analyst covering apple, gene munster. guest host for the hour, david kirkpatrick. i'm interested what you think about this story, the iphones, older iphones shutting down has been happening to me. this has long been a conspiracy among users, and apple released its statement in response to a report about this happening. what is your take? gene: i think you need to step back and just play the conspiracy series through. if apple is slowing down the phones for the purpose of lying newer version phones, that sounds like a risky business approach. the reason is to make your product worse in the hope that you will buy a more current risk of they run the people saying i don't want an iphone. --'s go over to and road android.

catch 22.s in a i don't think this was a conspiracy theory, but there is no easy way around it. when you connect the words "slowing down the phone," people will react to that. i would say that consumers vote with their dollars. if you look at the after market pricing on craigslist or ebay for iphones, they have .onsistently held their value issue, but doesn't fundamentally change how people think about the phone. should apple have been more transparent? are seeing arewe one that we are seeing more and more from big technology companies are crying a role in society and our lives, they are not good communicating what they are doing.

as we become more dependent on products and services and as demand grows for explanations for why they do things, they don't have any practice explaining that stuff, so i don't think apple did the wrong thing based on the evidence i've seen, however what they did wrong is not volunteering it and waiting for users to essentially out them and then the press forced them to acknowledge it. i think that is the mistake, and it does seem to me parallel to the kind of thing that facebook and google faced in refusing or being unable to explain how their algorithms worked. what they think they ought to be the solution for, things like fake news, etc. sometimes they will make a little progress if they force them, but these companies don't want to basically take responsibility and give transparency to what they are doing. emily: gene, people are still going to buy iphones, of course, but how do you expect the

se class-action lawsuits to go down? gene: i don't think they had any merit. i do want to say that david is spot on that one. the issue was how apple handled the message around it, not eating forthright. this has given people some opportunity where they see dollar signs here. it is easy to take a shot at them. i will make a large bet that these lawsuits go absolutely nowhere. emily: all right. you do have a new note out talking about apple's m&a philosophy. we have seen a couple of buys. what is the strategy you see playing out here? gene: they will be repatriating a lot of money with the new tax policy and that is probably close to $210 billion and that begs the question how will it change m&a philosophy and it the the simple answer is it will

likely have no impact on it. apple has never had a cash problem. having an absurdly higher amount of cash in the u.s. doesn't fundamentally change that. to answer question as to what their strategy is, they have done something like beats, but in general they don't buy brands, and we think they will that way. if you are looking at a blockbuster m&a deal in the next one or two years from apple, i think it is a very low probability. a lot of the same kind of strategynd doubles m&a in the near future. emily: all right. eugene munster of loup ventures, thank you for stopping by. coming up, qualcomm pushes back over broadcom's takeover plans. what is next for the chipmakers? this is bloomberg. ♪

emily: qualcomm continues its attempts to keep broadcom's takeover desires at bay. they are proposing 11 new directors by broadcom. broadcom is currently attempting a $105 billion hostile takeover of its rival chipmaker. qualcomm originally rejected the $70 a share bid. it's ceo says, "isn't even in the ballpark." joining us now is joining us now is matt larson, what do you make of the legal direction today? matt: i think they are looking at where the company is and apple's dispute in their licensing business. they have been saying we have been hit pretty hard. there is a lot of cash am a -- of cash on the table we are

hoping to collect. it is not indicative of the value of the company. so from a broadcom perspective, you are seeing additional value there if you can clean up legal overhangs and it is a good time to put a bid in. i think it is wise for qualcomm to try to fend those off. emily: how would it proceed? matt: the way things are shaping of now, qualcomm has rejected the bid. broadcom is looking to insert members on the board of directors. there is a vote in march and we will see how that plays out. we could the additional interest in qualcomm's board that will attempt to sway shareholders, and then you may see additional bids to move forward with the takeover process. emily: now talk about the legal pressure facing qualcomm from apple, from the ftc, and other regulators. matt: qualcomm is under tremendous pressure right now. there is a lot of scrutiny. there are allegations that qualcomm overcharges for its

chips because it essentially has some kind of monopoly power. it contributes to standards that are required in order to connect cell phones with wireless internet connection 3g, 4g, , looking down the pipe at five 5g. as a result, apple and people who make apple devices are not paying qualcomm's licensing fees, ultrahigh because of the qualcomm's leverage because of patents. it is not looking at licensing business right now. it is looking to resolve it through litigation. it takes a long time. we are looking at the third quarter of next year before we see any progress in these legal disputes. emily: interestingly, a judge apple for not turning over information fast enough. what do you make of that? matt: that's right. this is in the fcc's dispute with qualcomm.

it needs to get documents from licensees and others it has .isputes with apple has been producing 2.5 million,out but i believe it says in the pleadings, but they have another 1.6 million documents to turnover. with depositions coming down the pike, we are looking at things coming to a head at the end of next year, apple needs to get these documents turned over. there are deadlines that are breached, and the judge is saying this needs to happen fast and starting to impose monetary sanctions as result of not turning the documents over. emily: david kirkpatrick is still with us. david, what do you make of all activity happening in the chip industry, lawsuits, hostile takeovers, and all these various disputes? david: qualcomm is one of the companies that sort of created the world we live in. they have spent an enormous amount on r&d and we are moving

into this amazing world of 5g technology, which is just on the horizon. they will help make that possible too. i think of them as one of the great innovative companies, meanwhile broadcom is a much more of a roll up kind of company. the industry is not loaded with players that have fundamentally advanced social progress, and i think qualcomm is one. so i see it unfortunate that this company has been so burdened by so many legal problems. as matt has pointed out, the number of issues that surround qualcomm is very confusing for investors. emily: right. >> it is a good time for broadcom to jump in, but it is unlikely that they will succeed in the long term. emily: all right, david kirkpatrick, my guest for the hour, you are staying with me.

coming up, the venture capital outlook for 2018. we will hear from ethan kurzweil from bessemer venture partners. this is bloomberg. ♪

>> m alisa parenti. you are watching "bloomberg technology." -- i am alisa parenti. you are watching "bloomberg technology." congress has canceled three days of votes according to an updated schedule release. the u.n. approved new sanctions on north korea in response to the latest ballistic missile launch. the restrictions target north korea's economy and place restrictions on imports on refined petroleum products and shipping. the depose head of catalonia is demanding spain recognize his victory in regional elections.

he says the government must guarantee he won't be arrested if he returns to spain. he fled to brussels after a separatists declared independence in october. the vote was a bitter blow for the spanish prime minister. he called on catalan lawmakers to meet demands of its people. >> elections always mean a new start in democracy, the opportunity to start a new episode. i am hopeful that a new era based on dialogue, not confrontation, will beginning catalonia time of operation and , a not imposition, a time for plurality and not unilateralism. the government of spain would like to offer all its cooperation for constructive, open, and realistic dialogue, but always within the rule of law. russian president vladimir

putin says the u.s. has violated a cold war era nuclear arms pact. washington denies the claim , saying russia is developing a new cruise missile which would also break the 1987 treaty. the first visit to moscow by a u.k. diplomat in five years took a contentious turn today. that is after the worst johnson addressed allegations of russian meddling in the u.k. referendum. >> you should recognize that russian attempts to interfere in our elections and our referendums, whatever they may have been, they have not successful, so you can reassure yourself on that point. that is an important consideration, because had it been successful, that would have been an entirely different matter. >> global news 24 hours a day powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. i am alisa parenti.

this is bloomberg. we have more of "bloomberg technology" with emily chang coming right up. we hope you have a nice, happy holiday. ♪ emily: this is the "bloomberg technology." i am emily chang. softbank's record-breaking $93 billion vision fund has changed the capital venture landscape and effects can be seen in the u.s. so quite capital is said to be in early talks to raise a new sequoia capital is said to be in early talks to raise a new fund that could potentially top $5 billion. how do make a funds impact vc's and further down the line? joining us now is ethan kurzweil from bessemer venture partners. how has the softbank vision fund change the competition or landscape internally? ethan: thanks for having me, emily. i think it is way too early to know that today.

they are just picking out their processes and what they're doing best, but there are two things going on fundamentally. one is companies are staying private a lot longer, so softbank is the mechanism to take some companies public. but also there are companies not ready to go public and are getting more capital than they are used to, and that will take time to play do they spend it it out. do they spend it efficiently or do they wasted and create companies that are not strong, not sustainable? emily: my question is, is this a good thing, or lead to companies that results in companies that should not stay afloat? ethan: the latter thing will absolutely lead to that. if you're getting $300 billion million on your balance sheet, you don't cut costs or create the same efficiencies you would otherwise, so it is not necessarily bad businesses staying afloat, but companies not being incentivized to developing fundamentals to become great companies. that could have an impact on the

results of those funds and how startups operate. emily: clearly there is a lot of incentive to invest in tech. when you think of sequoia raising a $5 billion fund? that is huge. manyere are not that places to place money. look at blockchain, how much has gone there all of a sudden. i think it is a capital allocation game right now and over the next decade some of it will be well spent, they will get more money to spend, and some will be wasted. there will be some consequences to that long-term. emily: given the money flooding the system, how does that change things at bessemer? is the landscape more competitive? is there more money out there than ever chasing deals, which means you have to up your game or change strategy? is strategy changing it all within your firm? our game higheep at all times. in the important thing is we can invest at any age and it forces us to reevaluate our strategy. are we going to compete with

softbank $4 billion plus deals? probably not. we will move to the stage game we can be more effective. we have our roots as an early-stage investor and can invest early on, or we can go away. where we sense competition, we tend to shy away from those rounds, because we don't think there will be those kind of returns our investors expect. emily: so where are we in the cycle? there was the talk of a bubble and 2014, and it seems every ierr that things get frothy and investors have more money to spend. ethan: people much smarter than me would have to give you a prognostication on that, i don't know. i do know we are definitely at an all-time high in terms of frothiness. some of the money going into the company's that are not that that are companies not that mature, and it seems we are due for a pullback, but that prediction has been coming for five years. you need a trigger and i

couldn't tell you i know what that is at this point. emily: i know you are interested in e-sports. you made a big bet on twitch. ethan: we are looking at teams, enabling technology, platforms. there is a lot of people whose time and attention is spent in e-sports. it will actually surpass traditional sports over the next couple of years in terms of viewership. emily: really? ethan: there is a big audience for this, but dollars have not come in in the same proportion as baseball and football, but that will happen. emily: who is watching? ethan: the most predominant is millennial men, but that's not it. 25% ofomething like millennial men watching sports, but then transcends beyond that because audiences are fairly big and diversified at this point. emily: what do you see as being the biggest platform? ethan: right now it's a battle between twitch, facebook, and youtube in terms of the viewing

of e-sports, then there are ther market participants, sponsors getting involved in de-sports, as well as platforms for the play, the actual gaming platforms. the most prominent of which are league of legends right now and then blizzard with overwatch league. there are other upstarts that will contribute to that is welker to those the games that people are playing right now. emily: you mentioned facebook, which is diving into original content, and i know you are looking at media bets. where are you positive on media bets and where do you see those going awry? ethan: anywhere there is content with rabid viewership is being created, that's where the money will flow ultimately. some of that goes to very high and come premium content, and i am really bullish because that will be expensive to produce and require a very long sort of payback cycle. emily: you mean like netflix and amazon studios? ethan: exactly. those require long time

horizons. for startups, things like twitch work. it is user-generated content created every day and has a rabid fan base around it. there are different types of gaming experiences that have that same characteristic, kinds of media that have that same characteristic, where it is fundamentally user generated, but people love it and watch it. emily: what if somebody has a show on snapchat, and they are ending it or taking a pause, what you make of a move like that. is that bad for snapchat? ethan: i think probably not. i think it is a good move for cnn. it is good they experiment a lot. they probably could not get the formfactor to work. you about snapchat not being a medium that cnn could connect with viewers on or create a sustainable business around. i imagine that kind of experiment will work in other formats.

i'm just not sure what it will be. emily: where are you putting money in 2018? ethan: e-sports, media, everything around entertainment, that tends to create more opportunities for startups. emily: where won't you put your money? what do you think is frothy right now? ethan: premium content is something that we at bessemer have always avoided and late stage rounds where you are competing with the kind of investors you mentioned earlier. we will be probably shying clear of those as well. emily: great to have you back on the show. thank you for stopping by. ethan: thank you. emily: coming up leadership alphabet was just one of the top stories this week in tech. what else make the list? find out next. this is bloomberg. ♪

emily: it is official. president trump has signed the gop's $1.5 trillion tax plan. republican leaders claim it will be a boon to the economy, but one person who disagrees with them is the president of m.i.t. listen to what he told bloomberg in an exclusive interview. >> it means less money for all the things, financial aid, students, research, innovation. it is a very surprising move. emily: m.i.t. officials estimate the tax bill will cost the university $10 million per year.

the news of eric schmidt stepping down as google's executive chairman rocked the tech world thursday. a source told bloomberg that there is a likely candidate to replace the role. we sat down to talk about that, the frenzied week in cryptocurrencies, and the news that uber's ceo has picked a new right-hand man. >> he needs to fill out this bench that has been decimated this year by all the scandals. this is a really good hire for him. he is bringing on people he has already worked with who is familiar with him, and this guy basically took a company that eds pretty debt laden and built it up to be quite a rival to expedia. he seems like a good operator. emily: presumably as he flies

around the world trying to put fires out, barney harford can hold on the home front. uber must be traded as a transport company, not a tech company, a huge blow to uberx. >> what it means is uber drivers need to get licenses. in the know is uber x states, anybody can pick up passengers. actually, uber has been operating in europe like that for some time because of earlier rulings. so taxi drivers have to get licensed. it caps their growth and it is a challenge for a uber. emily: so have to talk about bitcoin. buys and sells, but a massive plunge. everybody asks whether it is a bubble pop, who knows? but what do we know about the malfunctions that happened today? >> i think it gets to the heart of the problem with bitcoin, which is that it is an amazing idea, but the technical plumbing of how it works makes it

absolutely quite slow, because there is no central party to confirm all these transactions. the way it is confirmed is in a decentralized way that slows it down a lot, and that is a big part of the problem. emily: this is a company investigating insider trading. coinbase is a popular way to buy and sell bitcoin. the ceo says they are investigating insider trading. this is the wild west and we shouldn't be surprised that this is what they are getting into at the ok corral. it is poorly regulated and people are getting -- with a lot. if you bought in the last couple of weeks, you are hurting right now. emily: eric schmidt is stepping down as executive chairman of alphabet. he is becoming a technical advisor. this after a 17-year-long career at the company. what is the story? why do you think this has happened? >> the obvious thing, which is

this alphabet reorganization two years ago, which he helped a lot with. is not so important anymore. that is the official reason. there may be some other reasons to do with his life outside of google and his work. in the politics arena, he was close to the democratic organization. he also had a run-in with and antitrust research organization pretty recently as well and that caused a bit of a scandal. there are certain things in the past year that may have precipitated this. emily: in this climate, a lot of people are asking is there more to the story? brad: it's true there has been an inordinate amount of attention on people's personal lives and their behavior in the workplace. it is a fact that eric schmidt has been separated from his wife for many years. they have an open relationship. he has entered into relationships and brought girlfriends to company events. we are in an environment where

people are making judgments about it, but perhaps it is just safer to not have him in that front man role. emily: meanwhile, companies like google seems like they are trying to hit reset in this new climate. who have new leaders emerge, and interesting in the statement that larry page shared yesterday, he mentioned himself sergei sundar as , the leader of the company. i thought it interesting he brought sundar into that. >> he came through a generation of leaders. some of those people left under a similar cloud, but sundar has emerged relatively unscathed and he seems a pretty straightforward operator. and so i think he is the perfect person to lead at least the google part of the business. brad: also, john hennessy, the former president of stanford, a godfather of silicon valley, but

hennessy seems to me would be a natural successor. emily: that was a week in tech with brad stone and alistair barr. coming up, a lawsuit in beijing and a dispute between alphabet's waymo and a uber. we will bring you the details. this is bloomberg. ♪

emily: elon musk's spacex will cap a record year with a rocket carrying satellites to california's central coast. it will complete 18 missions this year, twice as many than as last year.

baidu is suing its executive for its former autonomous and driving chief for stealing in-house technology. if it sounds familiar, that is because it echoes a dispute between waymo and uber. china's largest search engine provider is suing the company, led by a former executive. joining us now is alex webb and still with us is david kirkpatrick. alex, we have heard this story before. alex: a certain amount of déjà vu. emily: exactly. alex: in this space, what we have seen is a huge amount of startups being given a huge amount of money. they thought, why should i take a paycheck for us which might be huge, but to them relatively small. perhaps this is a case where he has gone out and raised $2 million and started this company. that is not what happened with

google and waymo as it is now called. those guys have been sued for technology theft, allegedly. emily: david, what do you make of this? we know the war for tech talent has always been fierce, but now in particular and the self driving realm it seems the stakes are even higher. david: allow me to be cynical, because we don't think of china as being this hotbed of intellectual property protection, so i don't think it will yield all kinds of fruit in that area, first of all. second of all, a lot of things are done for effect in this arena, and china spends an enormous amount of time and can thinking about chinese companies, and the chinese government thinking how can we be as good or better than american tech companies. so, i think it probably serves their interest tremendously well

to be seen as having the same problem that google had and suing this guy in the exact same way as google sued its executive who left. on the other hand, i don't know anything about the case, but when i look at investors, nvidia, extremely reputable investors, i can't believe they would invest in this company if he was the kind of guy who was ipking out the door with that didn't belong to him, so the whole thing smacks of a pr exercise. emily: that's interesting. yet, i think it happened before. >> i think the one element you have to consider is they are clearly competitors. one upshot we have seen of the waymo-uber case is that it has created a certain amount of headwinds for overs development. they have lost some talent. emily: absolutely, a huge headwind. alex: absolutely. it has made it harder to achieve

their goals. it sees a competitor more nimble than baidu and they are trying to find a way to put up more a few buffers for them. emily: talk to us about baidu's approach to finding more cars, the open source approach. alex: it is interesting. we have been trying to update this graphic, all the alliances. baidu comes out and announces several dozen partners in this project called apollo, where they are borrowing intellectual skills, some rivals, people with different skill sets, which rendered our map of all these these companies completely redundant because they have more partnerships than anyone else. i am always skeptical when anyone calls anything open source, because there is google stuff driving people towards google cloud. so completely open source? not quite, but they are lending technology to other people. emily: last question.

we have a minute left. self driving cars were a big theme this year as well as cryptocurrency. what do you expect to see in the self driving car realm? continuation of progress. probably legal progress to allow things to operate on roads. we will start seeing them on streets in limited areas. i think it is one of the most exciting arenas of technological progress in the world right now. the progress will be limited, but it is going to be very important. i put a lot of importance on it. emily: yes? >> one thing that is going to be really interesting is going to be the continuation of the businesses that support autonomous cars, the traffic management systems, traffic lights that can talk to cars and there will be a lot of capital flowing in there. emily: all right. we will be watching. alex webb of bloomberg tech and david kirkpatrick. happy holidays to you. happy holidays to everyone watching. we will be back next week. that does it for this edition of

"bloomberg technology." we will see you on tuesday. ♪

carol: in this week's issue, how to me to movement is affecting humanity. in a special section, the business is doing good and for the world. julia: all that ahead on bloomberg businessweek.