emily: i am emily chang in san francisco. this is "bloomberg technology." another conflict bluing -- brewing. google response to criticism that there search results they were the left. and state-sponsored misinformation campaigns ahead of the u.s.and state-sponsored misinformation campaigns ahead of the u.s. midterms tipping off facebook to meddling by iran.

what also they seeing? we will talk to the ceo. china's top right hailer will growthrowth -- will take after another passenger is murdered by a driver. how they can recover from the delete didi campaign. president trump said they are silencing millions of people. he is now taking aim at google treating google search results for trump only show the reviewing of fake news media. they haven't rigged for me and others so that almost all stories and news is bad. fake cnn is prominent. illegal? 96% of results on truck news are from national left-wing media. very dangerous. google and others are suppressing voices and hiding information and news. they are controlling what we can and cannot see. this is a various -- very serious situation. the president deleted those

tweets repotting -- risk run -- replacing them with slightly different ones. he said the search is not used to set a political agenda we -- the google spokesman said the search is not used to get a political agenda we don't avery any side -- favor any sign. mark gurman got a big wake-up call and we have him along with others. then, let's start with you. does the president -- ben, let's start with you. does the president have a point? >> some of the new conservative sites, farther on the right, more conspiracy minded, probably are not showing up much in google search results. news, which hex loves and watches religiously, comes up all of the time. we and d.c. hear this from

politicians all the time. you only write the bad things. the answer is that that is kind of what the news media does. it's a common critique and something we hear a lot from the president. emily: what has been the response from google, mark? mark: i was talking to some folks there claiming this is outrageous and the idea that google -- they don't with his two years ago with the idea they were suppressing negative search results of hillary clinton. part of the issue is that google has been pretty secretive about its algorithm and does not share a lot of details. point, they're done a lot to dealing with criticism. the other direction that they service misinformation and that tends to weed out a lot of sites

on the right and left, a predominately the right. emily: kate, you spent a lot of time in washington. what do you make of the fact that these companies are all under attack by the president? do they have something to worry about? >> it will be interesting to see. platformslake -- big and have become big companies. a lot of these companies come out of silicon valley and they will be in terms crosshairs. these are now communications platforms. he is going to hear and read about himself and the people he cares about all the time. i do think have something to potentially be worried about or involved in. you see them taking much bigger starting toey're have more communication and senior people are showing up there next week to talk to the senate intel committee on the broader issue of russian meddling in the election and how we prevented going forward. worry about it

certainly, everyone worries about overregulation, but i don't think they can rule out being something that needs to be discussed when we talk about communications. larry then, larry -- ben, kudlow says they are looking at google. this is at the same time google is expanding into china with a censored search engine. what could the government do here? news, there may not be a lot of things the government can do. that is a liability shield some sites enjoy for third-party content. if you were to cut into that, google would face libel suits. i've not seen appetite to do that. i've heard a lot of threats, but not heard a lot of appetite. the federal communications commission might also have a little bit of a nexus here. again, they have shown no appetite to do this sort of

thing. what i would be looking at is whether or not the government can do things on privacy or russian election meddling that would hurt the company. i think that is what they are looking over their shoulder right now for. emily: to that point, sheryl , anderg, jack dorsey perhaps someone from google, we don't know yet, will be testifying before congress next week. google said they would send kent walker and congress has said that is not adequate enough. some other senators had said they want the ceo, but they're not going to subpoena him. emily: why not? mark: i don't know. ceo love theal stuff. he loves getting in front and

was partly the ceo and chairman to be that sort of person. sooner is much more in the mold of the google founders. he loves to be a part of the company and being set -- and loves being at the developer conferences. it is not love addressing the public or being grilled by senators. emily: kate, is google making a mistake by sending -- not sending their top executive? kate: i think they are missing an incredible opportunity. part of it is that seriousness that facebook and twitter are now showing, is well-received in washington and well-received by the public. we are part of the audience as well. it is a missed opportunity. one of the challenges for the --pany is that data has big in one of their biggest assets. from the shareholder point of view, they need to play a role and make sure they are in a role to defend part of their assets that are so important while being responsive to the public. not having somebody senior there

could make their voice have less clout. emily: let's take a look at the market reaction, because you have companies like apple and amazon hitting new highs. facebook, in the meantime, got punished after the earliest results. we're also seeing alphabet not quite keep up. is that a result of all of these controversies? kate: facebook clearly because part of their issue with the users was the impact of the gdpr . if you have to authorize in sign-on and allow your data to be user not in different ways, you end up with fewer subscribers which is what facebook saw in that drove the results. that has been a direct connection between what can happen with regulatory bodies and what happens with valuations. it is quite direct. emily: ben, how can we expect these hearings to proceed next week? what are democrats saying about the latest kerfuffle?

ben: as mark said, they are pretty annoyed google wants to send kent walker. what they are going to drill down a lot is the november election. they will say are google, facebook, and twitter doing their part as far as they can control things? are they identifying foreign actors fast enough, does ago beyond russia? are they doing their part? what is very interesting is that jack dorsey, when he testifies in the house on the same day, you're going to face a lot of these questions, but today we ask about google. have: people on the left at times the same criticism of these companies. they really are in a difficult position. do we want them to be making these decisions? kate: it's always scary when you allow any human beings to make decisions. whose decisions are we going to make?

the thing facebook and twitter has been doing, you will be talking to the ceo later, because they play a big role, is that they are becoming more transparent. bots andke labeling your source of information like when you read a paper, it is good to know who the byline is from whether it is opinion or fact. that is important. they will be a very different conversation as we go forward. both sides care about this. mark: to ben's point, the major the rival for the content. facebook and google in particular have benefited from these massive media businesses where they collect revenue for content they are not responsible for hosting and they have been doing it for years. they dominate the industry and have depleted publishing in a large part. i have to think the sympathy is running thin. emily: they certainly make a lot of money.

mark bergen, ben brody, kate mitchell, great to have you back. sticking with google, at least 13 ngos have signed an open letter asking google to not provide china with a censored search engine. the letter said if it does go ahead with the plan, that "there is a high risk the company will be directly contributing to or complicit in human rights violations. google has a responsibility to respect and fulfill its own human rights publication." last week, facebook, google, and twitter took down iranian government backed accounts influencing global affairs. . the company to have to thank for that is fireeye. our conversation with the ceo is next. if you like bloomberg news, check us out on the radio, listen on the bloomberg cap, bloomberg.com, and, in the u.s., sirius xm. this is bloomberg.

♪ bloomberg. ♪

emily: it's began last week with the news that facebook shut down 652 iranian and russian backed accounts tried to spread global misinformation. it was then twitter and google's turn taking action against 284 accounts on their respective platforms. the facebook ceo had the following reaction. >> security is not something you ever fully solve. our adversaries are sophisticated and well-funded. we have to constantly keep improving the stay at -- the status. the shift we have made to proactive detection is a big change in will make facebook safer for everyone overtime. emily: one of the companies helping to make it safer is fireeye. to their warning that facebook and google spotted the disinformation campaigns.

join me -- joining me to can -- to discuss is the ceo, kevin. what was it that tipped you off? >> that is kind of interesting. first off, you get a sense for these things. respondingcades of to cyberattacks, you learn the tradecraft of the adversary. there is often a directly to folks doing cyberattacks raking internetworks and folks doing information operations. you can't separate them. i talk to the analysts that found this, a lot of it was their unique training and experience. they start pulling a threat on a twitter account that did not seem right. it was anti-saudi and pro-iranian, if the character account did not feel account did not feel right if the like a state sponsored account. as we pulled the threads, more things emerged. emily: you're talking about the lowest down here. what else could there be?

we have to believe there are other countries doing this as well. kevin: one of the things -- reasons we do all of this is it is tangential to protecting our customers and the rules of not settled yet. no one knows what is fair game. as i travel the world to meet other department of defense and government officials, everyone is thinking what is the government's role on offense and the government's role in the information space? as we are setting the rules, let's find where there are disingenuous sites, where there is not authentic news and pointed out to folks. emily: you believe these threats could be originating from other countries as well? what are you seeing? what kind of evidence have you seen to support? kevin: at the end of the day, it's crazy to think it won't happen. this is another tool governments will promote their agenda with. emily: we had brad smith on the alsolast week who

identified several webpages operated by a group tied to the russian military. they took control of the webpages. take a listen. >> what we're seeing now is a pattern that is similar to what we saw in the night is eight and 2016 when searching campaigns and political parties were attacked. it is similar to the pattern we saw in france in 2017. we really saw every major candidate for the prince -- french presidency targeted. we're seeing it again. emily: would you agree with that? kevin: it makes sense. if you are a political official, wealthy, influential, have power, you will always be targeted by a criminal element for espionage purposes. emily: we'll would you say is the extent of these disinformation campaigns? how difficult is it to stop? kevin: i think it is very difficult to stop. it will take defense for many different folks which is good why we are talking about it on bloomberg. the more people aware, the more

people will spot it. is easier for the folks trying to be divisive to spread fake news. spread fake-- to news, to do that, rather than to spread it. if we can see it and is organized, we hope to make a difference. emily: what should we be looking for? my inboxes filled with spam everyday. hundreds of twitter messages that are fake and suspect. kevin: everybody can play the role. give certain credibility to certain things and less credibility to others. in general, most people do not want to be surrounded by lies. they want to be surrounded by truth. when you see sites going up reporting to be new sites and you know it is disingenuous and not authentic, your right to know. emily: at the same time, google is being said by the president, does that run contrary to what you are trying to a compass? kevin: i'm not sure.

i don't think i have an opinion one way or another on that. we are protecting our customers one way -- the best we can. we need to be informed about the cyberattacks. emily: fireeye was recently engaged by google to detect breaches. tell us about that. kevin: i don't know if they were recently engage your not. we have thousands of customers that want our intelligence that rely on it to come up with their own risk profile. are we more at risk yesterday -- today than yesterday? there is a lot of companies relying on our intel. emily: what details in general about how much you have been approached by potentially new businesses in this new threat landscape now that we are more aware of what is out there? kevin: almost every business wants that. i'm a cyber security expert, but i do not work on the frontlines of industrial networks. we eat -- we need to get the

risk -- intel out to everyone so they can assess the risk they so what they know about geopolitics and their current security platform. the bottom line is, we promote the intel to folks so they can better safeguard their own networks. emily: is it too late to save the midterm elections? kevin: i've never been -- i speak more as a layperson in a cyber expert. it's hard to judge how the hearts and minds of people were altered by fake news or from anonymous people. emily: why is it so hard to stop? kevin: i think the platforms. the anonymity of the internet makes it hard. you can sit there and thousand you can sit 10,000 miles away and say you are from ohio or somewhere else and no one knows the difference. you tipped off facebook and facebook and not see that for themselves is that a little bit -- kevin: i think they could have seen it for themselves.

policing a platform of hundreds of millions of people worldwide would be a very complex challenge to do. emily: going forward, there's a lot of opportunity for fireeye and cybersecurity companies. what are the opportunities you are looking at to expand your business? kevin: we have the spokes and bring. we are -- brain. we're trying to defend all of our customers by having real-time security all the time. we believe attribution matters. who try iq or who did iq matters. that is the only way we can play a role in some of the more global policies. what we can allow people to do and not allow them to do, what are accessible behaviors. emily: what about m&a? kevin: we will always be mindful about that. we are on a mission to safeguard our customers and a lot of startups are doing good work. emily: what kind of work were we you -- will you be doing over the next few weeks leading into the midterm elections? are your analysts on high alert?

kevin: i think so. even the oscars can put you on high alert. there is different worldwide olympics, olympics, elections, other nations elections, and you have to go into shields up, and old star trek term. every single person involved in cybersecurity election system will be on high alert. emily: all right, michael cohen froml right kevin mandia fireeye, thank you for stopping by. 2018 has been a tough year for social media security as we've been discussing, now instagram is taking steps to be more secure. what they have plans next. this is bloomberg. this is bloomberg. ♪

emily: china's restaurant review

and delivery giant is now in gauging investor demand for an ipo in hong kong. a stock offering could raise more than $4 billion with an evaluation up to $55 billion. they are backed by tencent. fchile is the latest -- chile is the latest company to look to adapt to change the world of online digital platforms. the proposal aims to level the playing field between online services and more traditional businesses like hotels, and cable television. it also wants to competent for tax cuts at the same time. instagram announced it'll will offer the users to use more secure third-party authentication apps to login. this comes after instagram users reported they were being hacked to discover their account credentials have been replaced with russian you know addresses. know weounder said we have a lot of work to do to keep

that actors off of instagram and we continue to build more tools to do that. stocks are hitting records and new levels, but his big tex benefiting from the most recent rally? we will discuss that next. bloomberg tech's live streaming on twitter and be sure to follow ocr global news network tict on twitter. this is bloomberg. ♪ ♪

emily: this is "bloomberg technology." i'm emily chang in san francisco. back to our top story, president trump lashing out at google, claiming it is censoring results when it comes to positive trump news and promising to take action against bloomberg. the president made the claim at 5:00 a.m. eastern time without any evidence to back it up, and prompted a response from google -- search is not used in a political agenda and we do not bias results toward political ideology. our columnist warns his threat should be taken seriously, joining us from new york. what could the president or white house do here? >> it is not really clear.

we heard larry kudlow, the white house economic adviser, say the white house was looking into whether to regulate google search. i am not sure what that means. maybe he did not know what it means. but we have seen lawmakers already in congress talk about maybe cracking down on a provision of the law that shields google and other internet companies from legal responsibility for what their users post on places like you to, or facebook -- youtube, or facebook. that would be a pretty real threat, but it is not clear that's what the white house has in mind. emily: so you go as far as to say trump's claim is bogus, you say trump is run on the facts. why? shira: i think there are legitimate concerns by all political stripes that google and facebook both have bias in their algorithms, the computer systems that determine what 10 blue links we see highest on google, what posts we see at the

top of our news feed on facebook. bias ison't think the evident in news results about him. what he is reacting to, legitimate news stories from outlets like cnn he doesn't like, that he calls biased, that i would call useful pieces of information. emily: this comes ahead of next week, facebook and twitter at least testifying in washington. coo sheryl sandberg will be there, twitter ceo jack dorsey. google offered to send its top legal person, and congress said that's not good enough, but google hasn't offered anybody else. is that a mistake? shira: it is a mistake, because it becomes a new story. it looks like google is avoiding congress, or trying to evade responsibly for its actions, but it is also a bit of a no-win scenario for these tech companies, as it was perhaps

with the banks in the wake of the financial crisis when they were called to testify in congress seemingly every other day, right? these congressional hearings, they tend to be grandstanding, particularly on issues of internet censorship, as we have seen recently, and is not going to be a lot of useful information gleaned out of these hearings, so i can understand why the tech companies don't want to send their most senior figures, but it does look bad if you are not sending the people members of congress want to speak to. emily: all right. bloomberg tech will be there, of course, covering every minute. thanksrg's shira ovidew, so much for your opinion today. u.s. fits and starts, stocks are trading near all-time highs, the s&p 500 trading above 2900 for the first time ever. how does tech performance fit into the broader markets? michael purvis gave this bullish outlook. michael: why has tech been

stellar out performers? great stellar earnings outperformance, and earnings growth that has been consistent. emily: joining us to discuss where things go from here, the managing director of snead capital management, and our markets editor. we start with you. apple, amazon taking off, facebook and alphabet, not so much lately. how are you seeing tech performance fitting into the broader market? >> michael mentioned eps, but i think a lot of it is more the revenue growth. think about the performance of tech. it is still up. year-to-date, it's the best-performing sector, and of course was the leader in the first few months of the year. it kind of fell out of favor in june and july, but if you look at the data from august, it is back on top. up about 6% when you are measuring sectors in the s&p 500 , and a lot of that has to do

with the reason earnings season, and the revenue growth, revenue forecast these companies face. if you are a major investor looking for the safest sectors to be in, it was technology, pretty much the best-of-breed technology companies, the large-cap names that offered you good return and a relative degree of safety. emily: do you think the bullish sentiment will continue into the fall? >> well, how this all plays out over the next six months is really tough to guess, but i will follow on what romaine just said. this is about revenue growth. 15% of the total u.s. market growing 10% year in and year out, only 3% in europe. the idea, as long as you grow revenue, all the investors will come your way and it will work out fine, looks incredibly problematic, particularly because this is the epicenter of that in the world. when will this end? that's a tough question. will it be troubling? it looks mightily troubling from

our seat. emily: why? cole: just because of price. economics are led by the fact someone has to produce a profit, everything is profit-taking at the end of the day. we live in seattle, we kind of joke we are sleepless in seattle. here we set, 10 blocks from a company that does nothing but try to grow revenue, and uses things like the future value of a customer in perpetuity. emily: you're talking about amazon? cole: correct. i bring that up, because it's not just an amazon conversation. was talking about the google and facebook advertising model. judge judy does a better job of reaching advertisers in one show month.utube does in a emily: is that fair, given that facebook and google completely dominate the online ad market, which is growing? romaine: it is growing. cole certainly has a point, about just how they measure

their value and how they measure their growth, and there's an argument to be made, some of those measurements can sort of the picks apart. i guess, when i look at it from a market perspective, you look at where the crowd is going. this is one of the most crowded trades, when you look at large cap tech names, the faangs, even adjacent names. think about the hedge fund reports we got, showing in the second quarter on an aggregate basis hedge funds did reduce exposure to tech as a whole. breaking that down to large-cap names, they increased exposure to large-cap, apple, amazon, those folks. there's a lot of folks crowded into once. if cole is right and somehow those measures, metrics get called out or breakdown in some way, you could see trouble ahead. but right now, the collective psychology in this market is that is the safe place to be.

emily: this has been the story of amazon from the beginning, and amazon investors have never cared. cole: but it doesn't mean the stock hasn't fallen 95% before, which it did in the dotcom fallout. this idea that because they are so impenetrable, that happens in all manias. here we sit in san francisco. i live in seattle. these are the epicenters of conversation. tech,ant to regulate big through advertising. if hosting is what i want to regulate, regulate electricity, because you spend more electricity on things like bitcoin and hosting than anything else. it comes down to price. what can investors make in returns? what i rather take a risk on 2030, weveet that in have the most millennials between 830 and 40, and -- age 30 and 40, and the money i make on them buying cars and homes is

easier. emily: are you saying you think amazon could fall 95%, that we are on the verge of a dotcom bust or this could happen again? 15 stocks.is narrow, a 15-stock mania. straight out the 15 stocks, take out a lot of market cap and enthusiasm. at the same time, doesn't mean it can't be damaging for equity investors, because the indexes of these things, lock stock and barrel. emily: meantime, we see a pullback in asia, specifically is that something that could spread here? romaine: i think the short answer is no. the main difference, when you look at a lot of the big chinese tech names, these are companies that pretty much rely on china and the greater china area for their revenue. compare that to some u.s. companies that are much more diversified, classically

speaking. you know, they are not quite in the same category, in terms of the kind of customer base that they go after. also, you know, the chinese tech names are sort of dealing with other regulatory issues that are very specific to china, companies like apple, facebook, twitter, those types of companies are not dealing with because they don't have the same presence there. i don't know if you could compare them quite the same. but when you lump those companies in together, you take alibaba,s, the baidu, tencent, as a group it has been a pretty strong year for that group. obviously it has been weighted but aowards the faang's, lot of people see the back portion of the trade coming back later in the year. emily: should we be wary of what's happening in china? cole: about 40% of the chinese msci indices are tech. we are at 26%, add back amazon

and netflix and you get 30%. the biggest opportunities for stockpicking our markets saturated by tech. an index, you know, as investor you can't go away from that. as stock pickers, that is our opportunity. emily: what about crypto? cole: i will go back to my electricity comment. if you could transact the world in crypto, we would have blackouts like you wouldn't believe, because as international payment settlement group said, you can't actually do that, there's not enough electricity. so i would try to figure out what is sustainable. people are going to get older. i can make money on things like that. are we going to be able to greatly change the payment systems outside of paypal, those phenomena in the next 20 years? that is tough. emily: so you don't have any crypto holdings? cole: no. i'd rather buy gold, to be honest, but i think even that is stupid, too. emily: giving it to us straight.

cole smead, thanks for stopping by. romaine bostick, thank you as always. coming up, didi is having a "delete didi" moment after allegedly murders and sexual assaults by drivers. we will discuss next. this is bloomberg. ♪

emily: china's most popular ride-hailing app in damage control as thousands of users pledge to delete it after a second woman was murdered, allegedly by a driver while using its carpooling service. steve engle has more from hong kong. steve: didi chuxing is taking

fire from many fronts. web users, regulators and state media in china, after a female passenger was allegedly murdered while using the didi carpooling service hitch, despite a complaint about the driver froma earlier passenger. this is the second death in three months, after a flight attendant was allegedly murdered in may. thousands of outraged users say they will delete the app, including a popular actors who posted on social media in china to her 9 million followers that she deleted the didi app. the host received 285,000 likes, and more than 40,000 comments. the push in china to get rid of didi is reminiscent of the "delete uber" campaign last year in the united states amid a series of scandals and missteps at the american ride-hailing company. the uproar comes at a critical time for didi chuxing, as china's most valuable start of faces rising competition and as

it reportedly considers an ipo and a bigger presence globally. it is still overwhelmingly number one in the china market, with more than 30 million active users daily. the closest rival has just under one million. but still, it is a serious black mark and an opening for rivals, given the anti-didi sentiment that has gone viral in china. didi has apologized and has suspended two executives and has pledged to overhaul services. stephen engle, bloomberg news, hong kong. emily: china is home to 4 of the world's 10 most valuable startups. goldman sachs estimates the company has raised $31 billion in venture capital in the second quarter, beating the u.s. for the first time. the backlash against didi shows how the combination of skyhigh valuations and pressure from investors to produce returns can lead to missteps, undermining public trust at a time when a

slowing economy is already fueling middle-class anxiety. is china falling out of love with its unicorns? maybe this one. joining us now is selina wang. the story, there is much more to it. first of all, not just one woman murdered allegedly by a driver, but two, and also there is reporting that there are in fact dozens of sexual assaults and harassment complaints tied to didi drivers. selina: right. this isn't the first time they were suspended because of these alleged cases. this is the second murder in just the span of a few months. what is especially concerning, just a day before the murder happened, another woman flagged this particular driver to the company, saying this man had followed her after he dropped her off at the place. furthermore, the victim's friend from this most recent case said the company had actually been delaying the response to reports she made to the service as well. now didi has said there was an issue on the part of their

safety department and they didn't take the correct protocols to follow up with investigations within two hours. as you mentioned, many reports against didi, at least 53 women have been raped or sexually harassed by didi drivers in the last four years, and at least 16 rape cases were found involving didi citing court documents. rules,didi had new including that drivers could not pick up passengers of the opposite sex during nighttime hours, which seems a little, like a stretch. seriously? that's the best they can do? [laughter] selina: didi has certainly made mistakes in terms of safety measures, and after the first incident earlier this year with the flight attendant, they wanted to protect women from dangerous male drivers, so they implemented this role, during the late hours of the night and early morning, male drivers can't pick up female passengers.

that caused an uproar of criticism, not only is that very discriminating against women, it is also inconvenient for women, because most drivers are men, but they say they are trying to put in other safety protocols, including an s.o.s. button, stronger background checks, and other rules. emily: there are comments in the didi app, where women notice male drivers would be commenting on their looks -- selina: they put in this comments feature, where you could comment on how the passenger was as a rider and sort of rate them like in the uber app. the problem, the male drivers were using this to comment on the appearance of riders, so they have disbanded that. emily: the chinese government has been very critical of didi, which as we know is unusual, coming from the chinese government itself, which is normally more likely to raise

these companies up at a time when there is a lot of wealth concentrated in a few smaller, privately held chinese tech companies. how can didi recover from this? selina: the chinese government has taken a very strong approach against this, saying didi has this unshakable -- unshirkable responsibility and that they need to work with the government before they can restart the app again, and they said they are cracking down on what they call dishonest behavior. at the same time, didi is the largest ride-hailing app in the world, the most valuable company in china. the second largest competitor is a tiny fraction, so it is unclear if this will hurt their bottom line, and even if high-profile deletions will cause any sizable impact on its user base. emily: i know you will keep us posted. selina wang, thanks so much.

much more coming up. this is bloomberg. ♪

emily: sears stock got a big boost. the struggling retail and amazon have expanded a tire purchase and installation program. customers who purchase tires on amazon can get them installed and balanced at sears auto centers. amazon has discussed cofinancing movies with at least two major --joiningstudios, in us now with more, it is no secret that amazon has struggled with its studio and the

leadership of its studio. what can you tell us about these possible new arrangements? >> what me and my colleague have picked up on in l.a. is early exploratory talks amazon's having with two studios, major studios, sony pictures and paramount, which is part of viacom. both are the smaller of the big six in hollywood, and they are the ones that still take on partners.g the likes of disney don't. amazon has had conversations with them to explore what they can do to get bigger, more exciting films out to their users. one way that they might do that is by cofinancing films, seeking a stake in some of those potential hits. the finances of this, how big a deal would it be for a sony or a paramount to give up certain online rights to

amazon? or is it all about extra exposure? anousha: you know, it is a trade-off for a film studio. this is where some studios do it, some don't. someone like sony would have to , sayup any potential gains you sell 25% of the film from amazon, you spread the risk if it is a bomb, but if it is a hit, you get 25% less profits. that is something that potentially sony or paramount can't avoid, because they need funds. on the positive side, it would be a boost to the studios, meaning they can get more of the content that's out there, more of the exciting ip up for grabs, and compete better with the likes of warner bros. and disney and universal. both of those, sony and paramount, ranked fifth and sixth, so they could do with any help to kind of get that box office share. emily: amazon has had moderate success with its content, but

certainly nothing on the scale of netflix. how much does this have to do with the fact amazon may be struggling to produce its own hit content? anousha: one of the cautionary points made to us from our sources is that the fiscal early days -- there's still early days in the conversation because the studios already have out the deals with the likes of starz and epix. amazon still needs to find direction in the film unit, and this would probably be part of that. they had great recognition at the oscars for films like manchester by the sea, but no game of thrones-type tv show, no big, award-winning film that is seen by a lot of people that people really liked. netflix had the disney star wars films. while that might be tailing off, amazon doesn't really have anything to compare. emily: ok. l.a.ha sakoui for us in

you will keep us posted on any updates. that does it for this edition of "bloomberg technology." i'm emily chang from san francisco. this is bloomberg. ♪ retail.

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