♪ >> i'm selina wang, this is the best of bloomberg technology. up,lyft ramping up the ipo. samsung releases their most expensive devices taking aim at apple and rising competition from china. ,he global race for 5g

president trump saying he wants to embrace the new technology, but what will give the u.s. the edge? first, to our top story. yft could file the ipo as soon as next week about targeting roughly $25 billion. lyft have been planning ipos since last year, and it appears the latter is about to go first. we spoke with an investor. because of the shutdown, there has not been an ipo in over 15 weeks. so there is a lot of pent-up demand to see a big tech company idea. -- ipo. i think it will be well received, they are doing very well. >> to add to that, i think they wanted to go yesterday. ber is waiting in the wings and

they don't want to have a situation with a come in sucking up all the air there's a bigger fish year. so they are rushing, try to get this out quickly. wants -- don't want them to define what ride-hailing looks like, they want to come out and say this is our company, let's focus. a domestic company, not try to be this global ride-hailing giant, we're doing things well here. so it is important for them to get out ahead. >> so they have an opportunity to explain why this is a great investment. >> what have we heard from shareholders? >> people i spoke with today seemed excited. y -- lyfteager to see ; go first. they don't want uber coming in and dominating. but certainly, they can expect a lot of questions on uber.

shareholders seem extremely interested in the company. fidelity is already an investor, so it will be interesting to see what happens there. asiana got involved early on, what did you see back then? >> it was 2015 when we invested. whoave guys who invested -- look at the numbers, i personally look more at stories behind the business. hands down, people like lyft. people want them to be successful, i took a lift to get here. people say great things about them, how they treat people, treat women, their employees of the people they ride with. i'm excited to see where the company goes, i'm excited to see the employees i work with. i think everyone deserves a good idea, and we have been waiting

for four years now. selina: both of the companies are losing money, how d.c. investors stomach in those losses? look -- a lot of tech companies are not profitable, but there are working to increase margins, increase market share. they have a more streamlined strategy. they don't spend as much money as uber. they are really trying to expand socially and consciously, and i think they're going to get there, but they have to tell their story. but there slowly getting there by expanding. selina: how concerned are you about the risk of regulation? some of these minimum pay retirements -- requirements. >> that's a good question.

you will see regulations in all sorts of different companies, whether it is a ridesharing or airbnb. they're all going to work together to much about the end of the day, what they want to do is transport more efficiently in cities. they want to make it efficient, make it worth it, easier for the end-user. i think they will work with cities to make in the most efficient and pay what they need to pay. selina: i want to touch on pinterest. what was there thinking about the idea? -- the ipo? >> they just keep coming. pinterest confidentially filed. they will expect to see go around the summertime. a lot of interest and excitement in them as well. selina: briefly, what about picking the nasdaq over the

stock exchange -- new york stock exchange? nasdaq is an instant place to go. it begs the question of where uber will end up. nasdaq is popular for a number of reasons, they are up about 13%. you get a big, splashy presentation. it makes sense they end up there and we will see what happens. coming up, samsung unveils a smart phone with a price tag of a nearly tops $2000. is the vulnerable phone frenzy the next big trend -- foldable trendfrenzy the next big for consumers? this is bloomberg. ♪

selina: at the samsung unpacked

event, the company unveiled the biggest redesign of their smartphone.galaxy taking on apple with new models, 3-d cameras, fingerprints scanners, and 5g conductivity. cans a foldable phone and unfold into a tablet, allowing users to use up to three applications at once. this will be the first mass-market folding phone we have seen and the price is about $2000. it would make it of the absolute most expensive namebrand phone on the market. >> talk to us about what specifically you see will be a real competitor to apple? >> on the hardware side, what

samsung is coming up with is quite impressive. , there is oneces 5g device at the high-end, meaning they will have about a year and a half advantage over apple. also, a low-end phone to take on x-r.phone x are -- n theof the advances i camera seem impressive as well. what does seem ahead in terms of the camera technology, and of course 5g, i still think apple is ahead on the software side and versus integration. >> you reported apple is not working on 5g, at least for this year. do you think 5g keep ability will be a draw for consumers this year? i think so, in terms of the

marketing prowess and pushes we are seeing from companies like verizon. will there be an f people to take advantage of 5g? for these the first half of 20:20 am a 5g is going to be in a lot of markets across the u.s.. the problem for apple, since the company usually releases its new , unless apple pushes the iphone release up to 2020 or comes up a special price early in the year, it is going to be at least six months behind on 5g. selina: that was bloomberg's mark gurman. he also weighed in on how the devices fit into the global landscape. >> the new products look terrific. i really was surprised at the quality of the screens, the fingerprint technology. all that makes samsung very competitive. one thing to keep in mind is that they really are not competing with apple's phone in my view, as much as they are

competing with these rising chinese vendors that have very, very good devices at really low prices. >> what do you think will convince consumers to upgrade? you know the smartphone market is slowing. what do these offer? that is a problem we are going to live with for a while in this industry. you can see it reflected in the shipment decline we saw this year. roughly a 4-5% decline in the market. the next big push to upgrade is likely to be 5g. double phoneull introduced by samsung today is a move in the right direction, but am not sure it quite to get them there, in terms of sparking upgrade activity. how does this position

samsung to compete with the chinese phone makers, offering at cheaper or even less prices that some would say work just as well. samsung has almost been literally pushed out of the chinese market by these vendors heard. -- vendors. xiaomi, huawei, all with great devices. but as you look broadly, there is a lot of buying behavior aimed at buying quality devices with good displays. becominghe display is more and more important as video traffic grows as a percent of the total mobile traffic people really are migrating to video, and i think samsung has an edge with its displays. >> how do you expect the global market chart to look different at the end of the year then it

does right now? share has been roughly flat for the last couple of years. i think on the strength of this upgrade cycle, the introduction -e, the lower price, i expect it will track up a bit. i expect apple to be stable, maybe down a little bit. and then with the chinese vendors, sort of steady as she goes. selina: chinese search giant bao -- baidu gave an upbeat --ecast as new contacts content and products help energize business. they are spending billions on their newsvices like feed as they fight off rivals amidst a slowing economy. joining us to discuss is stephen engle in hong kong.

looks like things were better than expected, break it down for us. >> it was better than expected. we heard from the chairman earlier that it was going to be a chilly time in 2019. i guess they were alluding to the fact of the trade war, and that could affect the slowing chinese economy. that would have a knocked down affect, of course on advertising. baidu relies heavily on advertising, so that is what we were really looking at, advertising spending and also the top line growth. fourth-quarter adjusted profits , we are expecting one dollar 74. also, fourth-quarter revenue beat even the highest of estimates. was 3.8 9 billion, it came in at 3.96. basically, new content and

products have been energizing the ad business even better than probably expected. how has the broader chinese advertising industry held itself up? what they're trying to do is to bolster the advertising business, but at the same time, services that can complement that. they kind of wants to take the we checked model and build what is called a super app. an app that can provide so many different services. you mentioned others services, it includes ai driven content throughout that platform. there also separately building another division, they have their newsfeed. and another big one that they are seeing traction on is the netflix like video service.

is going to be a work in progress with the tough economic conditions. given these numbers, i'm sure they are fairly pleased that they have given them a little bit of momentum. in addition to those factors, there is also a crop of new , valued at billions, the most valuable startup in the .orld >> absolutely they are. as the economy is slowing, advertising rates slowdown and upstarts are siphoning off some of the ad span. keep in mind, alibaba has done much better of late. they are more on the laggards side, and they focus more on e-commerce. their advertising business has also picked up, so sure, baidu

has to pick up its game on advertising is why they are try to mix in these other services that is what brought down operating profits, it was about half what it was a year ago. so much onpending other services and new content. coming up, walmart posted strong sales growth over the holiday quarter as they continue to push into e-commerce. where it now stands in competition with amazon, up next. plus, we speak to the fec commissioner about the global race for 5g and how the u.s. can gain an edge. this is bloomberg. ♪

selina: good news for retail, walmart brushed off the industry's disappointing sales with the best holiday quarter in a decade.

the retail giant beat expectations while e-commerce sales rose in the fourth quarter. what they continue to take on amazon, the push and online sales is weighing on margins. a market analyst and correspondent from bloomberg opinions joined emily chang to weigh in. >> they showed real strength and a couple of key categories, one was toys. they had expanded the assortment online by 40%, they knew this was the first christmas without toys "r" us and badly wanted to claim that market share. it appears they did. the other element is groceries, they have been investing in grocery delivery and quick and collect, an area with a have an advantage because their suite of stores is so large. that was another strength on the digital front. >> what would you single out? a new design website, they went after toys "r" us. what do you think helps walmart close the deal? >> they are firing on all soldiers across every channel.

brick and mortar has been really strong, they have invested in the store experience and is bringing consumers back. ,nline was the headline here and i would also echo click and collect has been a huge driver. where other retailers faltered late in the season, walmart and amazon as well, walmart in particular was able to get those last and it sales because of the strong on the channel and click and collect execution. >> let's talk about the competitive landscape. i have got a chart here. compare the market caps of amazon and walmart. amazon and the blue, obviously, a much higher market cap van walmart -- than walmart. when you look at revenue, walmart brings a farmer revenue. when you look at profit, amazon works walmart. so it shows interesting conflicting trends. how do investors see this story?

>> i think that they see that theart is finding its niche growth is slowing down, it remains the undisputed leader with $.50 of every dollar spent online going to amazon, that is tough to compete with. but walmart is trying to find his niche, not only with click and collect, but by building this galaxy of other businesses where it can court a different kind of customer then it can't do the main walmart and this is why you saw it by lenovo's, bare necessities. and this is trying to steer the branded owns, focus on an affluent, urban millennial customer. a customer who perhaps would not shop at walmart under other second. circumstances. they are building this brand that means customers in certain places, unique compared to amazon. online, ever, even

going to squeeze the amount of profit that amazon from its customers? a big part of amazon's growth is profitability, coming from adjacent businesses. those businesses have a totally different margin profile. i think the big question here is walmart's core retail business is moving in the right direction but are they going to be able to layer on these more profitable that is something to watch over the next couple of .ears leveraging the enormity of customer data they have at their disposal. >> how is at the grocery battle shaping up? walmart is the leader, but amazon is in that territory and other grocery chains doing delivery as well.

>> walmart has strong geographic coverage. i think they said something like 70% of the u.s. population is covered by their services pick up. and the delivery service somewhere in the 30% range. that is pretty strong coverage. when you compare what amazon is working with, whole food only has a few compared to the thousands of walmart. but there is no question the dynamics are changing. kroger, a major grocery and competitive force in the space thestruck a deal where innovative british grocery giant is going to be bringing technology to the states, the automated warehouse technology to help kroger ramp up. this is a fast-moving, fast-changing landscape. , wherele is penetrated certain categories are 30-40% online. grocery is just 2% online, it is

anyone's game. meantime, the ceo of walmart is saying the online's trail saying is weighing on the growth margin. how they intend to combat that? right now, a lot of where that is coming from is flip cart. they know in the long term it will be a drag on the margins, but that is a long-term play. india is potentially this massive, massive market. it also be a little bit ambitious, nevertheless, it is about how that plays out over the next 5-10 years. i think it is market and willally understand what it means for the margins. >> that acquisition was hotly contested, how much do we know about how the acquisition is going? >> we don't know much yet.

what everyone was watching for today was about these new newrness populations -- e-commerce regulations. ceo on dougthe mcmillon said that they are disappointed by those regulations and are going to have to figure out how to work within them. but it is noteworthy they did -- adjusthe guidance the guidance. while they will have to work to adapt the regulations, they do not perceive them to be catastrophic to their progress on flip cart. and as mentioned earlier, flipkart is a long-term play. andhat was a market analyst bloomberg opinions sarah housing -- halzack. donald trump has argued the u.s.

companies need to take the lead in building the next five g network. but what does that really entail? and bloomberg technology is live streaming on twitter, be sure to check us out and follow our breaking global news network. this is bloomberg. ♪ i'm a veteran

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the u.s. represents really transformative technology from an economic perspective is well. 5g chinaven more about is a very different system than the u.s. does in terms of command-and-control.

it is trying to get the government out of the way and let our private sector invest. trying to spur investment into 5g. suggestsanything that a softer stance towards huawei? >> i do not know what the president thanks, but we have been very active in congress and the white house on the 5g summit earlier in the year. at the sec, we are taking action to see more 5g deployment. 13 said he saw 5g deployed last year and we are expecting to see 30 or 40 with five g technology this year alone. what are the risks to cutting ties -- companies rely on huawei because the team does tend to be cheaper?

>> we have a preceding ongoing at the fcc where we are looking at these issues, is there a security threat from a particular company or parts of the world? that is an ongoing proceeding where we have not reached a final decision. when you think about 5g, it will connect more than just phone calls. it will be about the internet of things, smart cities, telehealth up -- applications. it is about 5g values and when companies deploy these networks do you want companies that will respect the rule of law, respect ip protection, first amendment rights? that is part of why we want to make sure the usc's 5g first and u.s. companies are deploying these networks. >> the tweets mentioned not only 5g but also pushing ahead to 6g. what is your take? >> we are trying to get the

regulatory playing field right to unleash this new wave of innovation and then we will let the private sector take it from there. next-generation broadband will take on a lot of different technological forms. there is a new generation of low risk orbit satellites. we just want more broadband for more americans and 5g will be a piece of that. technology is on the rise that we are excited about. >> as countries around the world race to develop five g technology, how would you rate our administration to secure those networks from cyber threats? >> we are in good shape with respect to the deployment of the infrastructure. very focused on the cybersecurity issue. we have the right people focused on these issues and we are looking at it at the right time before we see 5g fully deployed.

>> want to shift gears to net neutrality. what kind of changes have you seen? >> it has been great results for consumers across the country. a report came out not long ago that shows internet speeds in the u.s. are up 40%. the sec released a draft report that shows the digital divide -- digital divide is closing substantially and there is a lot more to do to get broadband deployed. investment is up, speeds are up, prices are down. with the infrastructure and telecom crews, they are doing the hard work to deploy the physical infrastructure for the network. they said they have never been busier so we are headed in the right direction. >> can you give more detail on investments being up? one of the arguments was that isps would increase investment

that they have been decreasing the amount of investment. >> when you look at the end of the last administration, when the sec impose these regulations , investment took a significant downturn for the first time out of recession. we looked at the numbers for broadband investment across all providers. those numbers have turned around and that is a great thing. on the infrastructure side, when the sec started in 2017 with this big push to 5g, china was appointing new cell sites at 12 times our pace. have updated our infrastructure rules and the private sector is closing that gap. one reporter provided new cell sites at asked times the pace of before. others are doubling their infrastructure deployment to cisco put out a report that says if you look at 5g because of the

regulatory changes, the u.s. will see twice as many 5g connections as asia on a percentage basis. the new policies the essence -- s&p has been putting in place are working, but there is more work ahead. >> that was brendan carr. , aiming to modernize shipping just closed a division. we will hear from the ceo. from italy to internet giant, how china's recruit holding one from $13 billion of debt to serious charges for the likes of alibaba and amazon. this is bloomberg. ♪

forwarder flex board

secured $1 billion in funding. billion, they$3.2 plan to use the capital to deepen its technology and data capabilities and grow its global infrastructure footprint. emily caught up with the ceo. >> and international freight forwarding company in global trade and international freight forwarding are some of the biggest markets in the world, scale driven. the bigger your company is, the more than digit is you can provide your customer base. we need to go after that scale. emily: why take a billion investment rather than other options to get to the next phase? >> i was attracted by the ability to really go and aggressively expand our business globally. we need to be in every single country in the world.

our customers are little. -- global. emily: did you way the fx of taking softbank's money given the connection to the saudi government. -- government? >> we spent a lot of time thinking about it. i really felt like there was an ofgnment in our mission making global trade easy for everyone on the planet, connecting humanity and a seedless -- seamless web of commerce. i do not think anybody has lifted people out of poverty like shipping and trade. we are lucky to work at the intersection with ai and lucky to have an investment partner that sees that. emily: this is a government connected to the murder of a u.s. journalist. did you ask about this? >> i spent a lot of time with their people and built a lot of comfort.

we had a lot of great conversations and felt aligned in our values. emily: did you personally talk to them and what were the interactions like? >> he even invited me to his house. slippers andput on negotiate a deal. emily: what was your impression of him and why you felt this good work? >> i was always attracted to his worldview the have a great video of their 30 and 300 year vision. i have never saw dust seen a company with a 300 year vision and that was inspiring to me. everything he has achieved and to be in the presence of a visionary and hear the stories about his advice to alibaba in the early days about their pricing strategy to win that market, he had similar advice for us, to be aggressive and go

for scale and growth. emily: what trends in freight should we be watching for in the next one to five years? >> that will change a lot to where the consumer expectation is to day delivery and to do that, you cannot manage that by the phone. you need smart analytics to tell you where to ship cargo, when it will get there, whether it will ship airport ocean. what the brand cares about is the cost, transit time come and predictability of the system. the freight industry is only focused on cost historically. let's look at these other factors and see how they affect growth. >> that was ryan pearson. imagine an internet company that owned services comparable to linked in, it eharmony, zillow, and more? chances are if it was an american company, you would know

the name but if you have never heard of recruit holdings, you are not alone. i own a constellation of apps and portals. they have their sights set on attracting the most consumers in the world by 2030. sandra suture, professor at harvard business school joined emily chang to discuss. >> the disco -- the story about recruit starts with the scandal. this is a scandal of massive proportions. 1960ompany was founded in and it was around the mid-1980's of stockave shares that was about to go public in a subsidiary to about 70 government officials and high-ranking officials. news broke in 1988 and it was a sensation. it caused the resignation of the

japanese prime minister and his entire cabinet, and brought down another 150 people with them. is in the schoolbooks in japan and when you say recruit they will say scandal. that is how the company had a coming-of-age moment unlike that of most other companies. the first thing you should know about recruit is that it has been trusted. it has lost trust and learn how to regain it. toand 2019, you continue hear about these governance issues transparency issues. i am wondering how they managed to stage that turnaround and get past and existential crisis for the company. >> what happened was the employees but the company had about six months of life after the scandal broke, but they

decided if anyone was going to save the company it would be them. they went to all of their ,ustomers until their customers our founder did this, we were not involved, we will continue to serve you the way we have in the past. they were very convincing and they were very convinced they could still run a good business, and they lost very few customers. that was the beginning of the sense of a leaf in themselves. -- belief in themselves. japanese asset double burst and they managed to pay that off as recently as 2006. this is a company that has learned that on the one hand, it can really do bad things but it can be humble and curious an extremely confident in its ability to handle typical situations.

that is the spirit they bring to everything they do now. emily: what is the strategy today? they own a real estate portal providing direct loans to businesses based on daily traffic. how does this fit together? >> they have three segments in their business. one is all of their i.t. businesses that are very involved with artificial intelligence and matching platforms for jobs, they have got one in the middle where those businesses would be. that is what they call their ribbon model and it says they want to create value for the consumer and client, who is paying the money to be matched with the consumer. the third business is the staffing business for permanent and temporary staff. they have always had this mix in the company of being interested in trying to help people largely around education, finding jobs,

and growing out from there. >> that with sandra suture. coming up, is elon musk too fast to treat? ?- tweet another snafu, this time on production rates. we discussed next. this is bloomberg. ♪

the legal battle was in regard to the infamous tweet. the sec has kept a close watch on his twitter and it turns out he tweeted too soon.

he tweeted 500,000 vehicles and , 10,000 carsthat per week. there are estimated to be about 400,000. musk was supposed to really have a system of preapproval. 500,000 unit production forecast for this year was inconsistent with what the company did previously. inconsistent even the day of earnings and there was 400,000 deliveries this year. they said they could deliver as many as 500,000. it has been all over the place

with the outlook for this year and this was sort of a continuation of that. againstupposed to guard this sort of thing happening. >> does this concern you? heard -- past, we have ithink whether or not -- think in general focus on production, traditional analyst and institutional investors put which to -- way too much focus on it. economist -- in talking about production and hitting the specific targets

that they are off by a month or two, that will not change the long-term thesis. emily: the general counsel leaving after just two months. jonathan chang is taking over after musk surprised investors saying the cfo will be leading -- leaving. >> we do not know much besides this vague reference to it being a poor cultural fit. that is reminiscent of something we heard from some of the many executives that departed last year. one executive who comes to mind is justin machinima, who joined the company from seagate and was supposed to be the chief accounting officer and left a couple months into his tenure. he took for granted how much attention there was on this company. you also had a situation where he was up routing from

washington and moving to the west coast and focusing on this company on a full-time basis, and decided against this. it is clear weather last night's tweets had anything to do with this. it does not appear to be the case. generally, another indication that elon musk may be a bit of a difficult person to work for. emily: turnover is nothing new at tesla. ,e are talking about key roles the cfo, general counsel, the head of hr. does it concern you he cannot keep these roles filled? >> i would agree that must is a particular person to work for -- musk is a particular person to work for and you have to drive with that to be happy -- jive with that to be happy. the cfo came in at a time when

he felt like the company was ready to fly on its own and that is why he was ok leaving. when he was brought on, people were worried and said they will get a lot of litigation. now that he is leaving, there is more wary. -- worry. as you said, it could be a sign that he did not get what he expected. he will stay on in an outside role with tesla. emily: on a podcast earlier this week, musk made some interesting comments. he said people think i am like a businessperson or finance person. i am an engineer. the reason tesla is making rapid progress is because we have vastly more data and this is increasing exponentially. talk just a little bit about what he said in this podcast.

>> the podcast focused on autonomous driving. we did that with the purpose, because we are long-term investors. that is the picture we see ahead of tesla. $4000 int price is five years because of autonomous. that is something we have focused on for a long time. they are the only automaker collecting data from their cars on the road. waymo just published reports in california along with other companies testing their intervention rate. waymo has about 10 million miles as of october last year. tesla has roughly 8 billion miles with hardware one and hardware to cars. across theet them finish line to autonomous driving. it is important to have an

engineer at the helm of the country -- company that understands it. emily: this was on a podcast with you. were you satisfied with the answers he gave you? >> we were happy to highlight the autonomous driving piece. it is great to have a company like tesla where the ceo understands technology. he spends a lot of time with the autopilot team to be able to answer these questions. that is not the case with traditional auto companies. outcomehappy with the and certainly happy we got to spend time with him. happy to talk about the story of bit more that we have been focusing on. >> that was tosha keeney and cry trudell. that does it for the best of bloomberg technology. we will bring you the latest in tech every week, 2:00 p.m. new

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