union address. you will call for bipartisan action on immigration reform. we will have special coverage right here beginning at 9:00 p.m. eastern time. the president will review a republican memo on alleged fbi abuses before releasing it publicly. it alleges counterintelligence abuses and trump's inner circle. trump has five days to review the document. her paul ryan defended the plan to release the memo today. rep. ryan: there may have been malfeasance at the fbi by certain individuals. it is our job in -- to get to the bottom of that. we want all of this information to come out so transparency can reign supreme. ryan says it is unrelated to robert mueller's investigation. hawaii agencyhe

that sent an alert for an incoming missile, -- global news 24 hours a day, powered by more than 2700 journalists and analysts in over 120 countries. i'm alisa parenti and this is bloomberg. ♪ emily: i'm emily chang and this is "bloomberg technology." coming up, apple under pressure. reports of leaked iphone x sales and a new u.s. department of justice probe. the new alliance take aims at health care. jpmorgan and -- join forces.

onebook cross the lines running cryptocurrency promotions on its platform here it the selloff continues for u.s. stocks with most declines since august. a u.s. rate decision, the president's address to congress in the state of the union, let's bring in cory johnson in new york. walk us through the highlights today. y: there are a lot of the factors that lead to a market selloff. it is such that the baby in the bathwater all go together, but there are interesting developments in the world of tech and i think most important, one of the reasons for people to sell stocks was the announcement for this potentially big deal, this interesting idea of amazon berkshire with hathaway and jp morgan to

provide health insurance for their employees and perhaps the on that. they say if it works for their employees and families, it might help other businesses. of a bigto a selloff health care stocks. after yesterday's downward moving stocks, a lot of the selling and a lot of stocks with amazon outperforming the market and maybe health care stocks doing worse. emily: how do you think this will impact the health care sector more broadly? cory: it is an in tractable problem that has divided a lot privateest efforts of and public enterprise. a lot of the costs have to do with better health care available for those who can pay for it and people getting older. it is hard to fix the problem of people getting older. you will see if they can come up with some kind of solution for that, but i think in the short-term the market reaction is kind of ridiculous.

this is coming the same time as we have had a big rise in yields and bonds. it was very dramatic and we haven't seen this move really in about 10 years. this kind of move in the yields -- and falling of a bond prices across the board is very disconcerting. you didn't see it much in the european bonds. there is a disconnect there as well. as a result, equities look weak. emily: amd earnings also thesing, this in light of massive chip scandals affecting all of the chipmakers. disappointing forecast on profitability, but stronger forecast when it comes to revenue. what is your take away? cory: initially the stock sold off a lot. if you look at the amd trading

after-hours, it was a dramatic somethingell over 8%. you never want to see in cfo commentary, they are going to have to restate earnings. changegoing to have to what happened in the past. as he can see in the chart right after the it came out, stock fell well over 8% as people try to figure out what was going on with the amd results. is inread into it, there can't accounting principle called 606. it's a way a company when they sell a product, in the future, if they have to give services in the future or they have a warranty that goes forward, or to besoftware that has delivered over a certain period of time, there is a change in that role. some will recognize it shouldn't have bid. that revenue recognition change

is disconcerting. a.b. amd didn't know what they were doing or tried to hide things. they say it's a material, but number two, if they have to pull revenues from 2015 to 2016 toward future years, it has a perverse of effect of a slight rise in future prospects and taking way past profits. it may actually boost revenue going forward, but the kind of thing that the market doesn't like to see. emily: i want to ask you about electronic arts, cute the -- q3 earnings. good quarter for star wars, not a great quarter for battlefield, but their services business is doing well. the fee for business did well. trieddgame turks, people to build dream teams of peoples,

players, so on, really successful creating a longer tale of revenues not unlike amd where the sale of the product isn't the main thing, it is the stuff that happens over time. you wouldn't expect it from amd, but it is a big deal for ea right now. emily: all right. cory johnson, thank you so much. we will see you a bit later. government isu.s. said to have launched a probe into apple. they are investigating if the tech giant wrote the law concerning disclosures about a software update that slowed older iphone models. people familiar with the battle say it's in the earlier stages prompting apple to fall to a three month while. investors are concerned. to breakgurman is here

it down. what do you make of the government taking interest? mark: it is a banner week for apple. we are talking about the apartment of justice investigating apple scaling back performance of iphones in order to avoid reboots. it is still in the early days of investigation. he knows how far it will go? i think they will find that apple wasn't doing this to boost sales. we will see what happens. andy: apple has responded offered the solution to replace your battery, but there is concern that will put a significant dent in sales. how big could that be? mark: it's interesting, because sometimes people were buying new models in lieu of paying the fee. it'll be interesting to see if they take any unit hit of people not buying anymore, because people will upgrade their

batteries, because it's only $30. emily: talk about the iphone x cuts. are they cutting orders? mark: i feel like this is deja vu. we have this conversation every january. what to make of it, i think apple orders more iphones than necessary in order to meet their supply and demand balance. it's going to make a big impact on their earnings? no. it is unlikely that apple will miss guide us in any way. emily: you don't think there's any mismatch of significance happening here? mark: it's very possible. they miller -- they may have forecast or iphone x's, but they sold more iphone eight, but it isn't particularly bad news

anyway, investors are concerned about the overall sales. got --meantime, you've for some people it is a month's worth of groceries, even a big percentage of people's runs or mortgage, that's how much people will spend on the phone, that's how important it is to you. of on aof the price monthly basis, they could've push that the iphone x was a couple bucks more than an

iphone seven. i think that would have resonated more. they are not going to miss guide us. history they don't miss guide us very often. think we see something between the 84 billion dollars and 87 billion dollars. i think we will see a higher 30% perhaps between 20% and . fago ifut the function you haven't already. and you can see that analysts are expecting 30% increase from q2 to q2. it could mean that some people are waiting until the second quarter to buy new iphones and other products. emily: all right. as always, thank you so much for

joining us. we will see you back here for sure on thursday, maybe tomorrow, because you are here every day. cryptocurrencies are facing regulation by legislators. a widely traded coin -- to the dollar but has yet to verify its reserves. amazon, archer hathaway, and jpmorgan or pulling together to give their employees health where. -- health care. this is bloomberg. ♪

your command mom on bloomberg to

emily: let's get to the other

big stories today. amazon, berkshire hathaway, and jpmorgan planning a new company to provide employees with simplified care at a reasonable cost. this could be a massive disruptor where rising costs are getting massive attention. and the trio may not be the most expected to form a partnership, but what is not and it -- not a surprise is amazon's expansion into another specter. >> amazon is a powerhouse. their acquisition of whole foods is a game changer for them. players -- risk amazon decides to build its own paypal. >> amazon has been great, all the things they have done, that we cannot sit idly by and allow them to take our business. >> this company could double. >> they are going to be a force a force in searches,

55% of product searches are initiated on amazon, and lastly on advertising. now it is a 55% share. voice and the up home, app in the media with number seven and percentage of share during prime time, now it is number three. estes growing media growth, literally kicking the but of siri in full view of everyone. emily: jeff bezos had this to say about the deal. health care business is complex and we enter this challenge with open eyes about the degree of difficulty. for more i want to bring in zach steve from health

care venture activities. >> what a week for health care innovation. worst apple is getting into the space and now the announcement that amazon, berkshire hathaway, and jpmorgan main. if you look at amazon, they spend somewhere between $3 million and -- $3 billion and $5 billion on health care, it is growing three times over inflation over the past years. leastillion in cost at for amazon. the fact that they are getting health care, that they are frustrated with the way it has worked and they are trying to disrupt the industry, it doesn't surprise me. have: what details do we about how this is going to work? >> we don't know how it will work.

jpmorgan,hathaway, and amazon are taking on health care. a say that want to look at transparency, look at doing stuff digitally, bring down cost to provide care to their employees, but it remains to be seen. does it mean it will replace some of the middlemen in the system? certainly investors are concerned about it, but we just don't know yet. jamie dimon saying the three of our countries have just three of our companies have extraordinary resources. warren buffett saying the ballooning costs of health care acts as a hungry .apeworm does not come to this

problem with answers, but we also don't accept it as -- what kind of conclusion will they come to? >> they have been buying this so long, as zach said the intermediaries have been trying to do this for a long time and today, not surprisingly, their stocks are down significantly, anywhere from 4% to 6%. companies like united health and others have been hit. i think they are going to try to build this. two things they need to do, they need to build direct relationships with health care systems and providers. they need to do direct contracting, because that is where the cost is. develop those contracts. that is not easy to do. secondly, they need to bring the know they have around engaging the consumer, around paying.

risks.nderwriting you're talking about abroad population. that is where berkshire hathaway comes in and amazon comes in with the consumer engagement how how, analytics, and healthy or not healthy they are. i think they have a lot of row to hoe, a lot of wood to chop, but a company like amazon, they proved -- every single industry. wouldn'tee why they start attacking this industry and disrupting it. how much could this threaten incumbents and industry standards? the goal could potentially be -- other customers across the united states, how much could this change the industry? investors are saying this

threat is real, take this seriously, whether it is a threat to united health or the egg health insurances, cigna, and some down quite a bit today or the pharmacy supply chain, still not clear. but i think what these companies are going to discover as they move through this is as steve pointed out, they are going to themselves,d, do they may say we will let them handle that because they are better at it. will this be impacting or changing any of your investment decisions? steve: for sure. any venture capitalist will tell you they always think about amazon. and now that is true for health care. from the macro perspective, the health care market has had a lot of capital poured into it. there hasn't been a ton of

public offerings, only one last year. and i think -- i have always said that when the big boys amazon, apple, google get into the industry, that's going to be a bellwether tipping point. on the macro perspective it's going to affect the market and are companies focusing on on drug costs and the underlying cost to health care, as zach said, these companies are going to build some things on their own or they're going to buy some things. they may buy them from incumbent innovators in health care for some time now. thank you both. we will have much more reaction on today's news later this hour. coming up, weibo ramps up ride-hailing plans. for details, next. this is bloomberg. ♪

emily: a story we are watching, u.s. telecom verizon has a plan made by chinese manufacturer including a new five g network capable device. at&t made a similar decision this month, both have been under pressure from the u.s. government yard security agencies here that five g networks could pose a security risk. weibo plans to roll out a ridesharing service using driverless cars this year. but thousands more minivans from fiat chrysler. it is the third such deal between the italian-american carmaker and waymo. facebook has banned a whole

sector of ads on its platform and it has nothing to do with russia and the u.s. election. the social network is banning andon cryptocurrencies buying options. facebook says these ads are frequently associated with misleading or deceptive practices. theng up, amazon has thrown health care business into disarray joining forces with jpmorgan, berkshire hathaway. we will hear from the ceo of the health care provider on what he sees ahead. this is bloomberg. ♪

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counterpart for a strategic dialogue between the u.s. and the persian gulf nation. made civilian progress in everest to combat terrorism. as a result of the memorandum of understanding our countries signed july, the united states as qatar have increased information sharing. thateve mnuchin says russia will face new sanctions following the publications of that list of russian billionaires and top officials with ties to vladimir putin. steve mnuchin denied the reports that coincide with the expiration of a congressionally mandated deadline to impose new sanctions on the kremlin. news,e some breaking blackstone group has agreed to in these stake financial units. reuters.mson

global news 21 hours a day powered by more than 2700 journalists and analysts in more than 120 countries. i am alisa parenti. 5:30 here in washington. we are joined by david ingles with a look at the markets. david: it seems like we will get followthrough here in asia extending to global losses that they started here. yesterday was in the best of days, let's put it that way. especially across emerging markets. easily we saw losses north of 1%. especially for the smaller market and asia-pacific. this might be the front of the firing line when you have these yields pushing up globally. we are are already seeing a lot of decline over in new zealand,

maybe a quarter of 1% drop when you look at the cash in japan. a lot of data to get through and we will be following the state of the union address by president trump. a lot of things we are following and earnings coming through. it does seem it will be another session here in the asia-pacific and that is a look at markets early wednesday morning, i am david and less in more from bloomberg technology. hong kong.gles in more from bloomberg technology. >> this is bloomberg technology, i am emily chang. let's return to what our top stories. jeff bezos, warren buffett and

jamie dimon are getting into health care. j.p.hire hathaway and morgan are looking to provide tech solutions for health care at a reasonable cost. will eventually be used to challenge long-held industry norms and at the heart of the partnership is a solution to the rising health care for companies. cory johnson is in new york with a special guest. one of the important companies that is looking at this business is collective health. his self-insurance possible? i am here in new york and we can talk things to the magic of technology. technology make providing self-insurance for these companies possible in a cheaper way? is technology to key year? -- here? >> you can't really have one

function well without the other. it has been our belief and experience that technology can drive the change in the health care industry more broadly. yes, absolutely. these are smart guys, jamie dimon, warren buffett, jeff days us. -- bezos. i figured out what they will do. here's what i think might happen, amazon might think about getting a license to provide drugs, we are good at delivering services and data really quickly. j.p. morgan understands pricing. withhave real-time data how much individuals are paying and how much they will spend and managing insurance is the core specialty at the heart of berkshire hathaway. do you think that is how this shakes out? >> i would characterize it more

simply as employers want to have more control over how they spend their health care dollars and the experience that their family and employees receive as a result of that. i think this announcement validates what we have been working on for the last five years in boardrooms across america which is employers are fed up with paying for a lot of health care costs and getting too little in return. they want more control and i think they believe that technology is essential in giving them more control over that experience and spending. our success validates that. >> give me the elevator pitch for what you guys do. >> collective health is a platform for self-funded employers which enables them to administer their health plans with a lot more irony, control and ease than they can traditionally get with a third-party administrator.

terms of clarity, i think that is one of the most interesting things about the potential of an amazon fueled thing. what is it that companies and individuals don't know about their own health care russian mark -- health care? >> it is what they don't know at the right time. if you look at the systems that they are built on, they are from an era where analytics were not before, fast-forward to 2017, that is what drives most corporatism making. that will predict what happens in the future losing that using the data. for us, we built our infrastructure from the next up. help predictually and understand what is working, what won't work in the future and to get ahead of those. example,e me an actual something that a company would want to know. great example is how people are using things like

out-of-network behavioral health benefits for a lot of our customers. that is a really important thing to enable. this engenders other use of the health care system that is not essential. going to see a therapist, a .sychologist oftentimes, people might have symptoms that are belying a behavioral health condition. they will go to a regular doctor or emergency room thinking to have a brain tumor or something far more severe. that is a good is ample of using the health care system in a way that is very expensive to treat something that is not that expensive to treat and our software helps to highlight those kinds of things and enable employees to guide their people to the right kind of care at the right time. -- is thisalistic amazon, j.p. morgan, berkshire imagine -- could we that these three companies with that limited size could actually

lower health costs if they did their own program? >> i think if they use clock of health we can help them. they are spending much more efficiently than they already do. >> thank you very much. making the case, threw up two of those three big ceos. i'm sure his phone is ready to ring any minute now. in the latest tech revolving door, outgoing american express the eventual join cap -- venture capital firm, it was announced that they would leave annex after 16 years at the helm. he just joined facebook and airbnb and his appointment is much needed in an industry that is lacking in diversity. coming up, machines are learning faster than ever before but is your job in danger? we will look at ai's impact on

employment, next. this is bloomberg. ♪

♪ alisa: -- emily: twitter shares continue to surge after news about a potential takeover. they climbed 5%. they have rallied 18% since friday. we should also note that bloomberg lp operates a global breaking news network on twitter called tick-tock. the machines are coming for your job.

that is the fear that many people have. the fear that ai to be part of our society. express a gunns of worry over losing their jobs to a machine. a of those surveyed feel very worried. joining not to discuss this is luis perez. -- joining us now to discuss is luis perez. what do you make of the feeling behind the data in this study? people are scared. hear the word ai in so many things. everybody talks about ai and it is evil. no wonder people are concerned. the real concern is they are

confusing ai with automation. automation is not ai. automation is what makes us humans. what is the difference between ai and automation? >> we make things. -- may --ay think make things for us. technology, we need to make better businesses that actually use this technology and ai to take advantage of the automation and creating jobs, that is the point of ai. emily: at the same time, ai is advancing and you have facebook saying they have to hire 10,000 people to do the job that ai can't do. >> we have a case study of terrorism and abuse online. we have seen facebook and twitter invest a lot in machine learning and algorithms to catch that. we are also seeing them hire

thousands of people to manually cash that and even though we have thousands of human workers trying to do this in combination with ai, it is not enough. i think it is interesting that you have tech luminaries like jan musk tweeting -- elon musk tweeting about this apocalyptic narrative about ai. competition for ai's superiority at a national level -- the cause of world war iii. at the same time, mark tokerberg has responded these apocalyptic warnings, take a listen to what zuckerberg asked to say. >> -- has to say. >> i think people who are naysayers who try to drum up doomsday scenarios. i don't understand it. it is really negative and in some ways i think it is pretty irresponsible. years, ait five or 10

will deliver so many improvements in the quality of our lives. >> is ai going to be the end of the world? luis: i don't think so. it is so hard to bring a technology to the world. think of that coin, bitcoin was predicted to use as much energy as the entire united states in two years. so how are we going to power that robot if we can't power a single bitcoin currency? there are a lot of questions that and people and naysayers forgetting there are a lot of problems we can solve now because we have ai. companies likeg google, amazon and facebook invest heavily in ai. they do it for speech recognition, driverless cars -- how far are they along? luis: it is a dream right now. >> what is general ai? >> the idea that we could have a

computer that tracks intelligently with us. it could be like ironman. that is the type of ai i want. that is the dream. emily: we are getting close. >> we are getting close to be able to manage it. we are nowhere close to building that. >> who is the closest to building that? yearst know, maybe 60 from now i will tell you. >> china is investing $100 billion in ai. the u.s. -- china? >> so many things are being called ai. isn people say china investing in ai, they are investing in robotics, data and other things that are mostly technologies that have been known and are being used for 30 years.

the new technologies that are starting to use ai to solve i say the u.s. still has lead using that and other science. what we are seeing other countries do is things that the united states started during 20 or 30 years ago. emily: what about the risk factors? facebook created this ai engine that started craving a language that even humans can understand. -- creating a language that even humans could not understand >>. -- understand. >> i'm not sure they were even talking to each other. think about siri, it is eerily human because it has been trained to look eerily human but it is not intelligent. emily: if there is hoping to worry about, what is it? >> i am not worried about ai, i am optimistic.

i am more concerned about hacking, security, data floating about. that scares me more than ai itself. >> ai is getting too far ahead of itself? human intelligence can find backdoors into systems even more than the ai itself. emily: thank you for joining us .s well as selina wang samsung will report its final fourth-quarter results as investors worry about chip demand. we had to hong kong for the full report, next. this is bloomberg. ♪ mattel is taking another

shot at turning its iconic toy lines into mobile games. mattel is entering into a joint

venture with china + biggest videogame maker. they will debut their own a game. such lastplan to use mattel lines as barbie and fisher-price. samsung is getting ready to deliver its fourth-quarter results. -- final quarter resorts. -- results. stephen, what should we be looking for in these final fourth-quarter results? >> we will get net income and the breakdown of various divisions like chips and displays which have done really well. it was a record year for samsung electronics. is applied that apple supply chain with memory chips.

it is 7% against the greenback and i was looking at statistics from clsi. one say that for every 10 yuan increase, that was about 600 billion yuan. despite all the surgeon or fairly stable contracts supply of those screens and chips to the likes of apple, the yuan hurt them in the fourth quarter. is working on its own chips but samsung is a big provider of ships, is there a waning chipt demand, especially amid concerns that he iphone x isn't telling as well as some would have thought? that would have been a concern but they stabilized after that big surge.

the number two memory chipmaker. they control more than two thirds of the market with samsung, supplying through the likes of apple. that kind of us wages those fears. -- assuages those fears. jay lee going to jail affect this? >> they are respected to give a ruling on monday. i will be there in seoul for that verdict. again, the company has moved on. after brexit's, they replaced taking overy were as ceo. at the management operational level, they have taken a new wiley, he is j

still the de facto error. -- heir. he does not necessarily affect day-to-day operations. that was stephen engle, thank you always for that update. gets ready to report on wednesday that mark zuckerberg has pledged that his company has to do better for society. sarah frier takes a look at the mission ahead. it has been a rough year for facebook. the company's response to russia spreading thickness on its site has spiraled into a full review of the social met -- social networks role in society. >> this is the tip of a large iceberg. >> debating whether it is before your mental health. >> they have unleashed this mine control machine. >> were good for democracy. >> the echo chamber will get

worse. >> none of that will harm facebook's financial results. with 40 .2e excited billion in revenue. of 46% from the prior year. most of that revenue comes from mobile advertising. some analysts are concerned about the future. in response to all the criticism about facebook newsfeed, mark zuckerberg has announced a major trump to show more posts family and friends and less from media and brands. it is a move that could potentially lead to less engagement on the site. the company has to prove it can build up new businesses. this book is investing a lot in original content to show that it can compete with youtube. will those video ads work? when will facebook make serious

money off of messenger or whatsapp. i am sarah frier, bloomberg news. that does it for this edition of bloomberg technology, we will have full coverage and analysis from microsoft and qualcomm on wednesday. check us out at technology on weekdays. that is all for now, this is bloomberg. ♪

♪ >> 7:00 a.m. here in hong kong. we are live from the bloomberg asian headquarters. welcome to daybreak asia. the top stories this wednesday, asian-pacific markets will extend wall street decline. this is the biggest two-day fall since may. as warrencks plunge buffett and jamie dimon try to check things up with jeff bezos for the employees. -- their employees. >> looking to apple, the company falling on signs that it is