♪ emily: hello, i'm emily chang and this is the "best of bloomberg technology." an important step on the zuckerberg apology toward. u.k.eo's note the parliament but decides to testify on capitol hill. plus, uber agrees to sell its operations in southeast asia to a local rival. we will talk about what uber will get in return. -- questions swirl

around a fatal accident. to our lead. mark zuckerberg has decided it is time to face the congressional music. he will appear before the u.s. house and energy commission. this according to a congressional official familiar with the plan. subject of the criticism from lawmakers on both sides of the aisle. he will not appear before a u.k. parliamentary committee. we spoke with sarah frier who covers the social network for bloomberg as well as caroline hyde who joins us live from london with reaction from europe. >> zuckerberg has come to terms that he will have to do this. he said if i am the right person to answer these questions i will do it but i have to be the right person. congress can back and said you are the right person. we want to hear from you. to termsg has come with that. in front of congress, there are

going to be so many questions that facebook cannot answer. a lot of questions in particular gone where this data has that was shared with third party developers back before 2014. facebook does not know. they will do some audits. but they do not have currently the answers to the -- where are these 50 million user profiles? when did cambridge analytica delete them? they relied on cambridge analytica to tell them that it was gone. what is the reaction in the u.k. where he said -- i'm going to send my deputy instead? caroline: anger. came back fighting. the committee is investigating how fake news may have played a role particularly in the brexit decision.

the committee has come back strongly to the news that it will be a chief product officer that will come instead. he said it is absolutely astonishing that mark zuckerberg is not prepared to submit himself to questioning. and urged him to think again if for people.are a little emotional. in a letter that damien collins wrote on march 20, he said a senior facebook executive who they hoped would be mark zuckerberg. mark zuckerberg feels he is not the right person in this case. the letter that facebook sent back today said -- they are among the longest-serving executives and they have asked then said -- and they have extensive background and are well-placed to answer the questions. and they say -- look the u.k. and the eu should not matter to you. when percent of the global downloads of the app that came

from users in the eu and the u.k. this was the app designed and analyticato cambridge and gave them 50 million users. of those users, facebook says hardly any of them are from the eu or the u.k. emily: facebook is getting its ducks in a row to lobby lawmakers. they are hiring for a lever a -- they are hiring for a 11 different positions on capitol hill. >> i think the first thing we have to note is that facebook's budget spent on lobbying in d.c. is so much smaller than these companies that have been doing it for years. of the world.ples facebook is slow to join the party. in the past, they did not have a

contentious relationship with washington. they grew up in barack obama's presidency. now, they are realizing that they need to make nice and figure out how to get in on these issues before they come to a head. of all how to explain their product to congress, lawmakers. a lot of them do not understand some of the fundamental ways it works. like the fact that most ads are not purchased through human salespeople through an automatic system. this has become clearer in the last few months. but just like the general public, congress has a lot they need to be educated on. layers to data -- new the team bridge analytic a story. there is a whistleblower who worked as a contractor at cambridge analytica who has told parliament that brexit could have gone the other way if there

had not been what he calls -- cheating. you've us some more background on what we learned here. caroline: this is the pink haired christopher wylie, the whistleblower. mp's inin front of the the u k and he said the brexit could have gone differently if perhaps some of these related entities to cambridge analytica, which is the company disputes, but christopher wylie is saying that cambridge analytica's related entities were mixed up in the brexit vote and were paid significant amounts and could have how to swing that. he also said that 50 million people could have been affected by the cambridge analytica data overall. and he talked about another company. the company could also be wrapped up in some of this, emily. as the fallout continues

in the wake of the exploitation of data on million of facebook up with dickch costolo and asked him to weigh in on this controversy. >> one of the questions i have is the impact it will have on the way people think about apis and access to data in the future. obviously, facebook had built out a platform approach that enabled third parties to access the data and used them to engage with people on facebook. seeing thew consequences of some of that. i do think it will have an impact on the way technologists and company founders and ceos going forward think about how that data will be used, how they can audit how that data is disposed of, etc. emily: how does facebook use data differently than twitter?

i understand that twitter is more protective of data. do you think facebook has been too permissive and to careless about user data -- and too careless about user data? >> not to be an apologist for what has been going on but none of the apis where public. people did not know what they were capable of. and they have been long disabled. the big difference between twitter and facebook is that on facebook there is a lot of personally identifiable information and demographic information which turns out to be particularly helpful to advertisers. advertisers want to be able to demographically target. twitter does not have that information. going back a few years when i was running twitter, that was

thought of as a disadvantage. twitter does not know enough about its user so i cannot target my advertisement as accurately as i can on facebook. there are two sides to the point. in some instances, it is a benefit to the platform or the business, but in other situations, it can come back to haunt you. emily: we are seeing former facebookers speaking out about this. think "delete facebook" will take off? will it have a significant impact on users' desire to use the platform? they will beure returning their ill-gotten gains any moment now. -- these things happen. every now and then

when there is a big news event around these platforms. facebook is such an important part of a lot of people's lives. it may be the case that a certain number of people inside the bubble, here in silicon valley, will delete it. i do not think it will be a big movement. it is too important a part of too many people's lives around the world. only: is this disingenuous the part of former facebook users -- facebook employees? >> i are at a made a joke about that. it is easy when you are not a part of the company anymore to sit back and lob in molotov cocktails. there are people working extremely hard inside this company to do the right thing. twitter has been talking a lot about the issues. there are people inside the companies trying to do the right itng and i tend to not love

when people sit on the sidelines and lob in criticism. in an mark zuckerberg interview said that perhaps technology should be regulated. do you think it should be regulated? >> i think there will end up being regulations here. it seems like that tied is -- that tide is incoming. in challenge, particularly areas of technology is it tends areas anduently concepts and details that are difficult to understand which make them very susceptible to lobbying. allthere are lobbyists on sides of the equations. and finally, i worry that in most cases, the regulations start to fight the last war. in the past, this happen so let us prevent that from happening again.

the technologies are changing so quickly they do not anticipate the next issue or challenge coming up. they cause these companies work and maybe are not addressing what the companies have to deal with and what society has to deal with next. is sure that version two of aggression russian meddling is happening on the platform. -- if it ising on happening on facebook it will be happening on twitter as well. can they really keep up? >> it is an arms race like spam was in the past. therefference now is that are state actors involved on the other side. not just a few people trying to hack into an account. when you has state actors that have enormous amounts of resources, it will be a real battle keeping up with them and going after their new attack vectors. they will never attack in the same way as they have in the past. keeping up with that will be a

real challenge for these platforms. , could bill oracle for using its java programming cool -- code. they said if violated oracle's copyrights. the case was first filed in 2010 and remanded to a federal court in california. google said it is considering all of the next steps in this case. apple announces a new lower-cost ipad as it aims to go head to head with google's chrome book in the education market. if you like bloomberg news, check us out on the radio app, bloomberg.com, and in the u.s. on sirius xm. this is bloomberg. ♪

♪ emily: apple is making a new push to go head-to-head with google in education. butrket that apple has held

has let languish in the last few years. the tech giant has unveiled a new lap -- and new ipad as well as a new education at. when apple was founded 40 years ago, decades ago and for decades after that, it was synonymous with creative uses, internet users and education users. that has languished in the last few years. the latest market share data from last year indicated iphones 70% --ads plus imax had microsoft had 22% of the market. there was a problem and apple needed to address it. they decided to go back to an ipad that they released last year. it was a lower-cost ipad without

many of the bells and whistles. good enough for education users. this year, they are updating it with a slightly faster processor. support for the apple pencil. andw other small bells whistles including a camera. and slapping an education label on it. putting it in a new education marketing push. a also have new software. and an update for the class where app for teachers and students. they have new curriculums to develop for their swift programming app for students. a lot of new education software to go with the hardware. the bigger picture news is the push around a. nothing here they announced today is very novel but they are refocusing and renewing the marketing strategy around education. emily: mark gurman, our bloomberg tech reporter in chicago. i want to continue the

discussion now with our reporter in new york. you are quite strong in saying that apple may not be able to reverse its fortunes in this market. why not? >> mark talked about the market share losses apple has had in the education market because of google. it is one of the under told stories in technology. has managed to sweep into u.s. schools and take over the computing market there. i think apple's weakness, and they know this, they talked about it today, was the software. the big selling point of chrome books is not just the low-cost go system, ahis is bundle of devices plus all of the software that kids, teachers, and administrators need to both manage those devices and to have kids email, write papers, it assignments

from teachers and things like that. apple made some of those promises today that can they deliver? can a company whose software history is a little checkered if you think about some of the -- ofgs of a software software including itunes and icloud. the softwareve chaps to go head-to-head with google in education. apple came to dominate both markets. why could not something like that happen in education as well? >> it has been a seesaw market in education for decades. the market turn as leader. microsoft had a turn and google most recently. apple could rebound from some of its earlier losses in the education market. not impossible. but the weaknesses there that

google exploited on the software side and talking to teachers, using teachers as evangelists in the education market. if apple is focused on the education market, i think they can rebound. i am not sure they have the tech not -- technical chops are the focus on education they need to really make a go of it. still ahead, tesla falls the most in two years as investors question the ability of the company to keep up with production demand and its driverless ambitions. a reminder that all of our stories are stream live -- are live streaming on twitter. this is bloomberg. ♪

emily: waymo and jaguar are teaming up on 20,000 autonomous car is. the deal will integrate alphabet. with protests beginning this year. the suv's will become part of the ride-hailing service in 2020. the press forward for driverless forward forpath driverless cars is still unclear especially after two fatal crashes including the one in arizona and one in california. this week.ck tanked they are working to retrieve the logs from the vehicle. the crash killed the driver of the car adding to elon musk's challenges. it is unlikely to meet its production targets. we go to max. >> there was a very significant accident and tesla is saying it

is the most damage they have seen to one of their model x suv's. the reason this is a problem for tesla is they also have this huge production sprint going on. trying to get as many model threes produced this year as possible. to the extent that they are not able to hit those numbers and you have something like this that calls into question the company's long-term prospects, that could be a toxic mess for a company like tesla. emily: combine that with the general news about production delays. how much does this set tesla back? >> i think -- bloomberg has a model that is very impressive. we do not know how close it is. thatodel has been showing tesla's production is likely ramping up towards the end of the quarter. even though the numbers have not good, elon musk is likely to come out and say -- we

knocked it out of the ballpark because they did a last-second sprint. this is more than a sprint. they have to get to hundreds of thousands of cars a year which is something they have not done. no one has done it with an electric car. investors are going to be reading the tea leaves. whatever happens in the next quarter, they will have to continue growing production on a huge scale for the coming year basically. emily: we do have a chart that maps real-time news sentiment. the red is negative. the green is positive. and they have been getting a lot of bad news lately. not surprising the way the chart looks. what do you make of tesla's response and the fact that even they have said they have never seen a crash like this before? they are working with government agencies. is that standard? the think what tesla --

line they are trying to walk is they want to take this seriously. we are seeing it with uber as well. they take it seriously but they also want to leave open the possibility that even though there may have been a bad crash, maybe even one in which the car did not perform the way they hoped, that their autopilot could still be better on average than a human behind the wheel. that was the argument made in the wake of the crash last year where a person was tragically killed. generals sort of the tension around autonomous driving in general. even he will believe in this industry know that bad things will happen and they just hope that the number of bad things is less than what happens today with humans behind the wheel. emily: we hear the that uber is not going to renew its license to test cars in california. i wonder if this is going to

take a lot longer than some would have hoped to get self driving cars out on the road, en is surelya way that safer than roads are today. >> remember, elon musk has said that the cars on the road today could be self driving cars with some updates. part of the bed on tesla is betting that self driving will come sooner than people think. that is how tesla will be able to dominate the auto industry. if it takes longer because the tech is not there or because regulators cannot get their heads around it and we as a society cannot come to terms with whatever copper rise needs to be made, -- whatever compromise needs to be made, that will slow tesla down. emily: still ahead, the trump administration zeroes in on high tech industries in its push to

rebalance global trade. which industries will be most impacted. that is next. and more on our coverage from the fallout from facebook's skin -- data scandal. ♪ retail.

under pressure like never before. and it's connected technology that's moving companies forward fast. e-commerce. real time inventory. virtual changing rooms. that's why retailers rely on comcast business to deliver consistent network speed across multiple locations. every corporate office, warehouse and store near or far covered. leaving every competitor, threat and challenge outmaneuvered. comcast business outmaneuver.

♪ emily: welcome back to "best of bloomberg technology." president trump is pushing to rebalance global trade in america's favor and the global tech industry is preparing for a huge impact. white house advisor peter navarro's said the administration's tariffs on china will focus on high tech industries where beijing wants to lead. isthe focus of the tariffs on the china 2025 industries. china brazenly has released its china 2025 plan that basically told the rest of the world we are going to dominate every

single emerging industry of the future and there for your economies are not going to have a future. emily: we spoke with adam siegel on wednesday as the story was still unfolding. >> when they named the particular sectors they were going to try to penalize, we are going to see a lot of people trying to lobby to be left out of the tariffs and we will have a good sense on where you might fit on the supply chain and how you might be punished. know, again, who do you think the winners and the losers could be, essentially? >> well, they have been fairly clear that they want to punish china in high-tech. internet of thing devices, in automation, in robotics. the made in china 2025 plan is thettempt to move china up value chain from just

labor-intensive production to internet-based 3-d design. any of thosento areas, it is possible that you could get caught up in the tariffs. artificial intelligence. robotics. automation. those are areas that will likely be targeted. emily: i want to talk to you about artificial intelligence. there is a lot of talk about how the chinese might win in that arena. how advanced are china's efforts compared to the united states? three chinese have advantages. the first is the size of the data and the market. users and that data is available to the big players, including tencent, baidu, alibaba. ability to use

the data. chinese privacy concerns are not as high in the u.s. as they are in europe. and third, a government strategy. it very big push from the top for china to be a competitor in this space. the chinese firms are still not as competitive as u.s. firms. most of the important research is being done in the u.s. side lacks on the talent but they are a fast competitive in this space to the u.s. emily: breaking news. david shulkin is being replaced by president trump. the president will nominate his personal physician, ronnie jackson, to succeed him. the turnover in the white house, adam, continuous and leads to a good question on these issues. given the uncertainty of who is in these jobs, how do you think that will affect how the policy

will play out? >> it has affected the chinese. they have been scrambling to figure out who they should talk -- and whoshoul they should negotiate with. the president has been consistent with saying he wants to reduce the trade deficit with china. i suspect that whoever is in the positions right now, we will see consistency in that. to havevarro seems positioned himself to take the lead on these issues. and the 301 report is out. i think there will be consistency in policy even if there is some more moving around of the deck chairs. emily: the administration is also reportedly considering trying to penalize or influence chinese investment in u.s. tech sectors specifically semiconductors and a 5g.

how do you expect that to play out? >> we have earned the scene that the president has blocked the broadcom acquisition of qualcomm. we have seen leaks of documents that the government was supposedly considering nationalizing the five g networks. the most likely reform is a process. the there has been concern that some of the ways that china has been a choir in technology -- they have been either using minority positions or going after companies that are bankrupt or trying to purchase ip. i think that process will be reformed with a bill that has bipartisan support and that will make it harder for the chinese to invest in critical and sensitive technologies. emily: that was adam siegel. now, back to our continued coverage of the fallout from facebook's data scandal. of analyst is warning

potential halted some advertising campaigns on the social network. zuckerberg took out full-page ads in newspapers to apologize. for facebook not doing enough to safeguard data. is that enough to keep advertisers happy? advertisers are thinking about a couple of important issues. the first one is --what our users doing? are a lot of them doing #delete facebook? or are they keeping their account but using facebook less? they are also concerned about any sort of regulatory impact on the data they have access to. with regards to targeting advertising. if there were any sort of regulation that would involve

reducing their ability to target advertising, that is going to impact their ability to use facebook going forward. i think that is weighing on the minds of advertisers as well. emily: let us talk about engagement. i have a chart here. 5751. users versusdaily monthly users. an interesting way to examine engagement. how many users are going to the app every single day. we have seen it plateaus. how much of a concern is that? >> facebook does want to continue to see growth in daily active users but not only that, they want to see growth in engagement. not just people absentmindedly scrolling through their feet but interacting and talking to people. engaging with their friends and family. that is why you sell facebook a couple of months ago redo its outer rhythm to favor the concept -- the content from

friends and family. they need people to spend more active time on facebook. talking about advertising, in particular, there are a lot of questions as to how facebook will potentially evolve the way that it uses data in order to target users, in order to target advertising. i have another chart. 3831. it shows the prices of ads have grown. curious what you think advertisers are going to do here. will they wait this out? will they keep bring money into facebook because it is still one of the best ways to reach a specific user? leave?they going to >> those are conversations we are having right now with the marketers. i can tell you -- with emarket

ers. , can tell you preliminarily facebook is still one of the largest platforms around. at the end of the day, a lot of major brand advertisers still want to reach a lot of people. that is one side of it. targeting is another issue. andability to very finely precisely target people on facebook is something advertisers love about facebook. is anyain, if there limitation to that going forward, that will give them some pause but for now, the advertisers looking for branding goals or the massive reach will continue to use facebook and will continue to want to spend time and dollars there. and watch what happens in the next couple of weeks or months with regard to usage. emily: great to have you on the show. you, debbie. i want to continue to look at what this means for facebook. michael wolff.

from new york. curious, speaking earlier about the power facebook still has and the power that crises like these, facebook has weathered before. how big a deal is what facebook is going through right now? will thisf an impact actually have on facebook from a reputational and business perspective? >> facebook is an integral part of marketers campaigns today. there are advertisers looking to facebook to help drive their sales. if you segment advertisers, there are some that look at branding. and there are some that use google and facebook for what you would call performance, to drive specific sales. apart from google and facebook, those are two of the most important ways in which

advertisers are driving sales online and driving visits into an automotive dealership. an important part of what advertisers do and will continue to be. emily: i want to ask you from a reputational perspective. and in terms of trust of users. they might say -- users opt into in, but even when users opt they do not understand how their data is being used and facebook has not been clear about how their data is being used. well this undermine trust in facebook and thus impact engagement? >> it will undermine trust. but there is a lot that facebook can do to reestablish that trust. it is less about privacy and more about control. facebook needs to be explicit and allowing people to have control. second of all, facebook needs to be clear to its users what

and howion they have the information is being used. in the last couple of days, there has been news that facebook was using data from conversations on what -- on for advertising targeting. facebook needs to make it clear to users how they are using their data. and if users feel they can have control, they will not delete facebook. emily: coming up, the ai that great,s your phones is but did you know it could be bias? an inherent that is next on facebook. ♪

adsy: twitter is banning for initial point offerings and token sales on their site. they say they know this content is often associated with deception and fraud.

this decision comes after facebook dropped cryptocurrency. and google said it would ban these ads starting in june. artificial intelligence is supposed to make our lives easier. technology really colorblind or gender blind? a study from researchers at m.i.t. say that the gender of darker skinned women was incorrectly identified 35% of the time. how unbiased is ai? i do not know if we can it but we can medicate the effect of the bias. the first thing we need to do and what i am working on now is to give people a guideline as to how and where it particular data set can be used, it particular

api can be used. recognition seven -- software is far less accurate for women and particularly for women of color. that is sexist and racist. can you explain? >> we looked at commercial gender classification systems. they look at a picture of a phase and they tell you whether the picture in it is that of a man or a woman. male or female. i marry classification. they do not handle -- binary classification. when we look at the accuracies by race and gender. race though is not a very well-defined thing. we looked at skin types. we look at skin tone. a dermatologist approved way of looking at skin types. as the skintight gets darker and

darker, for women, darker skinned women, the gender approachesion has -- random chance. in answer to your earlier question, one way to mitigate the bias is to try to gather more diverse training sets and also test our algorithms on different parts of the population. instead of having one single number saying that this algorithm has a particular accuracy, when you break it down by subpopulations, it might work much better for some populations than others. emily: apple has a problem with this. done a systematic study of apple's face id but there was a highly publicized article of a chinese woman who did not work id well on her. i am pretty sure this is a problem that happens across the

board. face recognition but other algorithms as well. emily: facial identification is just one example. if we do not start retraining these out the rhythms or rewriting them and get new data to fix this what will happen? >> one thing people do not understand is that ai components are being used everywhere by everyone. that is an exaggeration but it is in many places. if you look at face recognition algorithms, they are being used to identify what people think are criminals. that is one debate that people should have anyway. even if it were to be used for surveillance, we would have to make people understand that these face recognition

algorithms are not accurate enough to be used for surveillance. you say women are at a bigger risk of losing jobs because of this. how so? >> i am not sure women are unilaterally at a bigger risk of losing jobs because of ai but i do think that anyone who is inginalized in this moment our society is at a higher risk of losing jobs because of ai. many of the lower paying jobs that are more easily automatable are being done by people who are from lower income, or people that have been historically marginalized. anyone that our society has marginalized is more likely to lose jobs. emily: how much of this would be anded by getting more women people of color into aim machine learning? how much of this can we not solve because it is already done? >> i think a lot of issues of

bias can be mitigated by not only having more people from historically marginalized communities in ai but also interacting with these people. it is not a coincidence that the two authors of the paper you were describing on gender classification systems and how bias they are our black women. if you are not interfacing with people who are negatively affected by bias in ai, you are less likely to think this problem is a big problem. do you think companies like microsoft or google are doing enough to fill diverse teams and try to make sure that the bias does not get rewritten over and over again? >> no, i do not think companies are doing enough to build diverse teams. i would say that is in unilaterally true across tech companies. there is a lot more talking about diversity than action. some action is going on but it

is not a priority. emily: my guest was from microsoft. to grab,ts operations uber. we will talk about that coming up next. this is bloomberg. ♪

emily: samsung vice chair j bradley is visiting europe in sincerst business trip getting out of jail. it signals and eagerness to getting back to managing the global giant. withefective chief met global investors. newspaper announced that he departed one day before the annual shareholders meeting. cooper has agreed to sell its southeast asian operations to grab, withdrawing from another

fast-growing region. uber'sll acquire all of operations there. in return, the u.s. ride-hailing service will take a 27.5 percent stake. and the ceo will join the board of grab. they are one of the earliest investors and what -- they were also involved in the deal in china. onlye competition has not both happened in china and in southeast asia, it has required a lot of investments and in some wastagere is a lot of in the process. the consolidation makes a lot of sense for both grab and uber. track -- what they and now ina

southeast asia are good deals for both companies. emily: uber also got a huge investment from softbank which has its hand in other ridesharing companies around the world and uber's competitors. how much of her role is up playing in the decisions being made about strategic partnerships? he is a very influential man. didi and ined in uber and in grab. perspective, obviously, this consolidation makes a lot of sense. itdefinitely has a can't in -- he deftly has a hand in it. i do think that the local will be going beyond

the ridesharing. when you look at what is happening in china, dd, despite consolidation will face competition. competition is not over yet. i think the consolidation is a step forward for grab and uber to have a strong landing in the local services. emily: if that is the case then, tot would be your message the new ceo of uber about latin america or elsewhere? about these enough other markets to make -- to provide good advice but what we arethink in seeing in southeast asia is the ridesharing service is a very local business.

and i think it has to extend beyond just rides per se. multipleto offer services on your platform and that includes food delivery service with high density cities , andbeijing, shanghai other cities in southeast asia like bangkok. -- and including jakarta. ridesharing can be a strong contender to the local services as well. you have to have the services on the ground. ,hese other markets like india i do not know enough about them to make a comment. as of now. managingank you, partner at tgv capital. that does it for this addition of "best of bloomberg technology ." we will bring you all of the latest on technology throughout the week. he sure to tune in on tuesday.

one of the most highly anticipated announcement to come. remember, our stories on bloomberg tech are livestreaming on twitter. that is all for now. this is bloomberg. ♪ retail.

under pressure like never before. and it's connected technology that's moving companies forward fast. e-commerce. real time inventory. virtual changing rooms. that's why retailers rely on comcast business to deliver consistent network speed across multiple locations. every corporate office, warehouse and store near or far covered. leaving every competitor, threat and challenge outmaneuvered. comcast business outmaneuver.

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