emily: i'm emily chang in san francisco and this is "bloomberg technology." coming up in the next hour, a busy day on capitol hill. president trump's former lawyer, michael cohen, accuses him of criminal conduct in a hotly contested house hearing. in a separate hearing, robert lighthizer says the administration is pushing for a deal with china that includes significant structural changes to beijing's economic model. plus president trump and kim jong-un

on schedule to begin their second and final day of their summit. we're live in hanoi. our exclusive conversation with alibaba executive vice chair and cofounder joe tsai, and why he is optimistic about the u.s. china trade deal. and why he thinks investing in professional sports could ease tension. to the top story, all eyes in washington on president trump's former personal attorney and fixer, michael cohen, testifying before congress. the contentious affair continuing after we saw plenty six hours. of heated exchanges as cohen laid out testimonies including a bombshell on the 2016 hacked democratic national committee emails. mr. cohen: a lot of people asked me about whether trump about the release of the hacked documents, democratic national committee email ahead of time. the answer is yes. emily: plenty to discuss. i want to get to new york where

our bloomberg executive editor who covers financial investigations is standing by. let's start with that first of one. all, the revelation trump knew about this email hack. >> that is right. according to cohen, roger stone called the office and trump's assistant put them on the speakerphone. roger stone said he had talked to julian assange and this dump was coming. i will have to note julian assange has said he never talked to roger stone. once again, we are caught in a bit of what could be the truth here. it is often the truth is that there is a go-between. whether someone else who represents a shaanxi -- assange, or weatherstone was telling the truth. roger stone is operating under a gag order by a judge right now. we're not hearing from him this afternoon, but it is one of several scandalizing things coming out of the cohen testimony.

emily: let's talk about the other tantalizing things. what are the new and most significant revelations otherwise? winnie: i have to be honest about this. for prosecutors there is nothing revelatory here but for the , public, it's astounding to see a sitting president attacked and treated like this in congress. it is unusual. not since bill clinton's impeachment hearings have we seen something like this. the attacks on his personality and character are stunning. in terms of the legal issues, michael cohen cannot speak for prosecutors, but he can give us a glimpse of some of the threads of open inquiries so we can see potential here. that is all it is at the moment. there are several. one involves the trump organization itself. according to cohen, others were involved in questionable activities along with trump. cohen says trump was the one who dictated the terms of the

payments to stormy daniels and repaying michael cohen for it. cohen says the long-term chief financial officer of the trump organization took him aside and said we would make it looks like a retainer agreement. that would be some kind of a books and records issue for this corporation. that is one thing. separately, cohen talked about how trump may have inflated purposes ofertain assets and undercounted them for other purposes. did he misrepresent the value of assets? for example when trying to , obtain a bank loans or, for example, when trying to get insurance premiums lower? those things have been brought forth and give us a tantalizing tidbit of what prosecutors could be looking at. emily: the president is busy in hanoi so it's unclear how much of this testimony he was able to watch.

he did retweet an old tweet he himself wrote saying michael , cohen was one of the the many lawyers that represented me. unfortunately he represented others too. he was disbarred by the states up in court for lying and fraud. he's lying to reduce his prison time. cohen was interrogated over and over again by republicans. he did indeed lie to congress and is going for jail for it, but that said, what are the tangible legal issues that might arise out of his testimony, as it pertains to possible collusion and possible obstruction of justice? >> on the collusion front, there was not much new. michael cohen was asked about that and he said there was not -- he said he was not aware of any efforts. he suggested trump knew about this information coming from wikileaks. it did not go to the point where he was directing or involved in it.

the other example is the infamous trump tower meeting involving his son and the russian lawyer. is speaking cohen to what he suspects to be true, but not what he knows. he said don jr. would have consulted him on this. he recollected of conversation between them, but that is not proof. to the core issue about collusion, i don't think we got a lot new today, except a little more detail and color and a few more questions about whether someone was involved in communicating with wikileaks. emily: all right, winnie o'kelley i know you will follow , this. thank you so much for that update. michael cohen was not the only person speaking to u.s. congress on wednesday. president trump's top trade rep robert lighthizer testified before the house means committee on the continuing trade talks with china.

he made sure to highlight the importance of technology in these efforts. take a listen. >> as you suggest and no full well is the key technology will , determine who rules the future. emily: sarah mcgregor joins us now from washington. did lighthizer dampen the optimism around a deal with his testimony? sarah: absolutely. it's no surprise that lighthizer is a bit of a trade hawk. he has wanted to go tougher on china from day one of these negotiations but his tone was , more cautious than trump's when he delayed this march 1 deadline. lighthizer said there is a lot of work that needs to be done for a deal. once it is done, if it is ever done, there will be monitoring of it. meetings that need to happen and a lot more work to ensure china is implementing its promises, including these tough issues like intellectual property

theft. alleged forced technology transfers. there will be constant vigilance to make sure what china says it will do it lives up to. emily: does that contradict what the president talked about earlier this week? he was talking about progress, delaying the tariff deadline, does it suggest a mismatch between what the president wants and what is happening? sarah: it injects realism into what is going on behind the scenes. trump said the sides made substantial progress, but a deal of this magnitude, as you mentioned earlier with such high consequences, there is worry about dominance of the future technological innovation. to try to tackle these issues, even if they have a few more weeks tacked onto the deadline, it is not a lot of time to deal with these issues. emily: what is next? what is the timeline? sarah: we have not heard yet of

the next round of talks. the last one wrapped up here on in sunday washington. we have not heard when the next official talks will happen. trump is in vietnam for another very important meeting, which china is involved in as a big economic player in the region. trump is meeting with the north korean leader and they are pretty focused on that right now. we expect talks to pick up when trump gets back. there's talk from trump about a signing summit with the chinese president, but as lighthizer reminded us, there's a lot more to deal with before they sign a deal. lighthizer said this will not be a soybean solution, this won't be a matter of china agreeing to buy more energy products. they want a deal that deals with ip tech transfers, the whole gambit. emily: and we will continue to follow how whatever outcome from the summit with kim jong-un impacts these talks, given the role china plays there. sarah mcgregor, thank you so much for stopping by.

coming up, the ftc is putting big tech on notice. what is new task force could mean for tech deals past, present, and future. that is next. if you like bloomberg news, check us out on the radio. listen on the bloomberg app, bloomberg.com, and, in the u.s., sirius xm. this is bloomberg. ♪

emily: big tech in the u.s. could soon be under greater scrutiny from federal regulators. the federal trade commission is creating a task force to investigate potential antitrust contact by tech companies. the group will consist of senior officials and 17 lawyers. they will be looking at past tech mergers that could have hurt consumers. what does this mean for tech companies like google and facebook? to answer that i want to get to washington where we are joined by a fellow at the open markets institute. advocatesation that for aggressive enforcement. also with us is our antitrust reporter, david. i can think of a few previous tech mergers. facebook buying whatsapp,

instagram. what is this task force going to do? david: they will look at any competitive conduct by tech companies. as you mentioned, one of the interesting things the ftc announced yesterday was this idea that they could go back and look at consummated deals, deals they investigated or did not investigate at all. the possibility they could go back now and potentially breakup companies or require a spinoff. if that came to be, that's would -- that would be a fairly radical move by the agency. there's a lot of criticism that some tech deals like facebook, whatsapp, and instagram, even a lot of google deals, should not have been approved at the time. it turned out to give those companies a dominant position in their market.

emily: let's get the view from one of the critics. matt, you called this task force a joke. why? matt: it's a commission that is creating a task force to encourage cooperation among its bureaus. great job guys, do something. facebook, since 2007 or two -- 2006 or 2007, they have bought many companies. the ftc has not challenged a single one. there were deceptive statements by mark zuckerberg during the whatsapp acquisition when he said it would not change the privacy terms for whatsapp users. the ftc has been investigating the cambridge analytica scandal for almost a year. no wall street investors ever asked mark zuckerberg about the ftc investigation, but they are perfectly happy to ask questions about european regulators, so this is a crisis of legitimacy.

rather than doing anything, they come out with a new seating chart. emily: for the record, i did ask sheryl sandberg about the investigation and didn't get much of an answer. we have heard the ftc is preparing a record fine. will this be a drop in the bucket for facebook, we do not know yet. david, what are the chances the sec takes action here and unwinds one of these previous and already completed acquisitions? david: based on the agency's check record and not just the ftc, but the doj, that's would be radical. both agencies, which they both share antitrust jurisdiction in the united states, are facing a lot of criticism from people that enforcement has not been aggressive enough. one of the reasons is, they are too permissive on big mergers,

allowing tech companies to buy potential rivals and potential companies that are competitors. i've never covered a case where an agency has gone back to undo a deal that has already been consummated. this announcement has drawn some cautious optimism from some quarters, but also some criticism that this is the kind of work that they should have been doing all along. there are questions about why they need a task force to do something they should have been doing in the first place. on that note, for all the criticism, isn't this the agency doing something rather than nothing as you argue they have been? matt: really, no. this is a new seating chart. it really doesn't matter. they need to police american

markets as their mandates suggest they should. it does not matter who sits where in the building. emily: i want to ask you about your organization's connections to george soros. there has been controversy about that. he has been a huge critic of facebook. even to the extent that sheryl sandberg directed her staff to see if he had anything to gain financially or otherwise from these criticisms. does he have anything to gain? matt: george soros? emily: yeah. matt: i have no idea. we are a think tank. we take no money from for profit corporations. we get foundation funding. i think we had a grant from the open society institute. i don't think it was a big grant, but we have done work on monopoly for years.

i don't know what george soros' interests are. i've read his speeches. he is concerned about totalitarianism in china and elsewhere. i hope that answers your question. emily: it helps to address some of the concern. before we go, for the record, what are some of the big tech acquisitions you think should not have happened? what are some deals you think should have never been approved? matt: i think there are two ways to understand this. first of all, google has eight products with more than a billion users. most of them are acquisition. that is google, applied semantics, and you can go down and find the way they achieved market dominance in one sector and monopolize all of the

plumbing in the end market. it can be broken with a rule written by the ftc. for facebook, you have whatsapp, instagram, and probably a whole bunch of other companies. they bought one for microsoft to match into data targeting. what this is about is ensuring our ad markets are fair and open. right now, what these tech monopolists are doing is unfairly redirecting advertising money from publishers of content to themselves and manipulating the free flow of information online. it is the ftc's job to make sure that does not happen. they have to do it. emily: we will be tracking how this progresses. matt and david, thank you both.

a reminder bloomberg tech's , livestreaming on twitter. you can follow our global breaking news @tictoc, on twitter. this is bloomberg. ♪ ♪

emily: a dutch payments firm continues to defy expectations with another earnings beat that sent shares soaring in europe, back to almost triple the listing price eight months ago. bloomberg broke down the results from london. >> your ipo list continues to defy expectations with another earnings beat. firm, which processes payments for netflix, spotify and uber had a higher rate increases. in most recently expanded, while adding clients to its platform at the end of next year. hired take rates was also a positive surprise given the formption higher volumes

client would usually come with the discounts. even after initial enthusiasm moderated as the day when on, the stock continues to trade at almost triple the listing price eight months ago. on far higher multiples than most of its competition. adyen is in the middle of taking ebay transactions from its u.s. rival paypal, with volumes moving already. peter vendor gross cited increased geographic reach that supports point-of-sale business. a push to increase brick-and-mortar presence with self-service kiosks could boost earnings. despite the lofty valuation models highlighted by skeptics. bulls will take confidence in the high numbers posted today, even if at larger numbers they are largely baked into the share price. emily: square give a profit forecast for the quarter wednesday that missed estimates. this as the payments company

spends more on new services including its fast-growing , peer-to-peer cash transfer app. the company beat estimates for the first quarter, rising 65% year over year. joining us to discuss his david ritter. shares dropped. what is behind that? david: expectations are always high coming into the corridor -- quarter for square, given their track record of growth. there was a slight deceleration in revenue growth, where you have seen acceleration throughout 2018. when they reported earnings last quarter, they guided for better than 40% revenue growth this year and came in a little bit higher than that, not tremendously higher. i think that is a source of little disappointment, but i would say, when i see deceleration, we are talking about a company growing over 50% from last year. emily: that said, how is square

performing compared to its competition? david: they are doing tremendously well. i had a chance to attend jpmorgan's analyst day yesterday and jamie dimon called out square as a company that beats them to the markets. jpmorgan chases a big portion of their markets. he said the reason they have been winners is not because of the original device that plugs into an iphone, but the fact they started there but have since devolved into a full merchant services company. there lending to merchants and providing payroll services, help with scheduling. if you are a restaurant, you can have help with your menus. they have been very effective in layering on various services, the reality is, they are still early on in selling those add-on services to the existing merchants and they are capturing larger and larger new merchants as well. emily: david ritter, thank you for the update. coming up, the world is watching the summit between president

trump and kim jong-un. we will go live to hanoi. this is bloomberg. ♪ loomberg. ♪ want more from your entertainment experience?

just say teach me more. into your xfinity voice remote to discover all sorts of tips and tricks in x1. can i find my wifi password? just ask. [ ding ] show me my wifi password. hey now! [ ding ] you can even troubleshoot, learn new voice commands and much more. clean my daughter's room. [ ding ] oh, it won't do that. welp, someone should. just say "teach me more" into your voice remote and see how you can have an even better x1 experience. simple. easy. awesome.

>> welcome back to bloomberg technology. trumpng-un and president struck an optimistic note. what are some of the most significant developments of the day that we need to know about? >> the significant developments a lot are looking at are the specifics to be drilled down.

in comparison to what president trump and kim jong-un agreed on back in singapore. many are saying the joint statements are ambiguous and to reciprocate. what can we expect from day to bank? -- two? >> day two is a big day. expected to have a joint statement. by the u.s.ogether nuclear envoy stephen beacon. knowing what we know so far, he is in nuclear disarmament expert. nuclear disarmament might be the

wording. we want to see exactly what the details are. >> how might any impact -- any impact affect what is going on? >> that is a good question. it is definitely an overarching team. all -- his train went through china on his way to annoy. he can't do anything without the approval and pressing -- blessing of xi jinping. using north korea

as a carrot negotiating with china. >> thank you so much for that update. we will have a full days coverage of these meetings. throughout the day, we are going to be talking to veterans of foreign policy. leon panetta. kathleen stevens and christopher hill. all live starting at 6:00 p.m. eastern. ,s we discussed earlier tradeent trump's top negotiator is dialing back expectations for a trade deal with china. with an interview from the sports innovation complex. . innovationorts conference. >> the tariffs are going to

stop. businesses on both sides of the ocean. chinese manufacturers will get a reprieve that will help them to export. it is going to be good for the businesses >> what if that doesn't happen? >> the dialogue between the u.s. and china is going to be a continuous dialogue. ,rade is not the only issue there are issues of industrial policy. be aect that will continuous conversation. the tariff is an enforcement mechanism.

our business is driven by domestic consumption and also corporate -- even though we have some parts of our business are tied to exports, most of the business within alibaba is driven by domestic consumption, with 300 million consumers, middle-class consumers that are buying things, they are going to demand more products. over time, even if there's no trade deal now, over time, the trade deficit between china and the united states will correct as china will import more because we have an economy where domestic consumption has become a bigger part of the economy. so the chinese government is talking about over the next 15 years, importing $30 trillion of goods, and $10 trillion of services. that is a very important thing, as american service companies, in health care and banking can move to china and set up a

foothold and serve the chinese population. emily: what does it all mean for alibaba, whether or not a deal happens? joe: we operate for the long-term. we are hopeful that a deal will happen. obviously the markets have responded to that, but if you look at our core businesses, most of it is tied to domestic consumption, as i said. so even if it doesn't happen, we will continue to chug along and focus on our strategy. our strategy in new retail, for example, is focused on digitizing the domestic retail sector, making retail more efficient, and that is all driven by domestic consumption. emily: how optimistic are you, based on what you have seen, that a deal will be reached?

joe: i've always a glass half-full kind of guy. we are cautiously optimistic, based on the developments. obviously the delegations from the countries that met several times, and president trump has said there is going to be a meeting between him and president xi and a place in time to be determined, i believe. i think these are positive developments, and the signaling is pretty good right now. emily: we are here at the sports innovation summit at the stanford graduate school of business, and you are the owner or co-owner of three sports teams. what attracted you to make these investments? joe: first of all, i love sports. i played sports through high school, college, and i just think the values of what you

learn on the field can carry you very far in life. so i encourage all kids, including my own kids, to play sport. emily: but it's also a business opportunity. how much revenue are these teams driving? joe: if you look at an nba team, it's a very good proposition from a business standpoint. the nba is a substantial, well-managed company and the structure of the nba is set up so that there's very good balance between the owners and players and also among the owners. i was attracted because of the international profile opportunities. markets like china, with 300 million fans, the potential increase in the media rates in those margins, not just china

but also india. you're looking at mexico, indonesia, the philippines. those opportunities will be tremendous in the future. emily: the nba just announced a branded league in africa. why not in china? joe: i don't know, you'll have to ask about the geographic location, but i think the africa league is going to help the nba to develop players in africa. obviously they decided there is also going to be a local fan base in africa. there's a lot of developmental aspects to that league. i think it is very exciting. i think having leagues in other parts of the world is a little bit more challenging because in europe and asia they already have local leagues that have been formed, playing games and all that. so i think that is one of the

reasons why nba picked africa. emily: there's a mixed record for sports diplomacy dating back to the 1970's and the wrong -- ping pong games ending up with president nixon visiting beijing. do you think sports could help improve tensions between the u.s. and china? joe: i think absolutely. because when you see athletes competing on the field, and then when they get off the field or the court, they become friends. these are real authentic stories between people, and i think that people to people exchange, this true friendship that is genuine and authentic, is going to help the two countries understand each other better. emily: some of my conversation there with the alibaba co-founder joe tsai. how is film business scored big with oscar-winner green book.

this is bloomberg.

emily: best buy is an exception in a gloomy earnings season. they posted holiday sales better than expected. sales were driven by a, video better than expected. -- appliances, video games, smart watches, and smart phone devices. we returned to our exclusive conversation with joe tsai. it is not just netflix but

alibaba that made author history by taking home an academy award. alibaba coproduced green book. now the company is looking at more hollywood movies as it expects more goods and services, including entertainment, to be imported into china. here is more of my chat with joe tsai. joe: you have to look at this particular case as what it represents in terms of what we want to do in investing in movies. we want to invest in quality production and the process of us committing to this project and green lighting this project is very interesting. one of our team members saw the movie and she really pushed this internally. so the committee that decided to commit our capital to help make the movie was convinced that

this was going to be a quality production. we got involved because we see the opportunity to bring high-quality content into china. so we went through a process of getting the project screened through the quota system, so the movie is now going to premiere in china on march 1. tickets will be sold on our internet platform and we expect a very good result. emily: do you know if any of the trade talks involve getting better access to the chinese market for u.s. studios, getting better ticket revenue, for example? joe: i'm not aware if that is a specific conversation within the trade negotiations, but i think the overall trend is that china will be more open for imports, not just in goods, but also services, including content.

we are hopeful that over time, that will happen. $10 trillion of services over the next 10 years, that will be very exciting. emily: are chinese officials encouraging chinese companies to invest in u.s. entertainment? joe: currently all the decision-making we make on investing overseas is driven by our company management. we just think in this particular case it makes a lot of sense for us to make that investment. emily: six months until jack ma steps down as chair. how does the company change once that happens? joe: the whole thing about a transition is that the company doesn't change. jack has done a very smart thing by announcing it one year ahead of time, to give people ample time to adjust to the new system , and the great thing is, we have a great ceo in place.

he has been the ceo of the company for over three years. he would take over as executive chairman of the company and he has been with the company i think for 12 years now. someone who has homegrown developed within our system. we are very proud that we have been a vote to take our younger executives and develop them into leaders. emily: alibaba has bought a few foreign platforms. what is next in e-commerce and more broadly? joe: from an e-commerce standpoint, accessing local market consumers, we like southeast asia and south asia. these are the markets we want to focus on. so the platform, operating in six countries, will be the focus over the near to medium term.

we will have to wait and see what we do. it is a very big undertaking to do something to serve consumers outside of china, for any company. i think for us, we are going to take it one step at a time. emily: that was joe tsai. ibm has apologized for using racially insensitive labels in an online job application. applicants were forced to choose between categories including yellow. the question was asked in brazil and south africa. still ahead, mike cagney is back with a new venture after allegations of sexual harassment.

he is not the only man from the me too movement back at work. we will discuss, next. this is bloomberg. ♪

emily: 21st century fox was ordered to pay millions to actors of the tv drama bones who claim they were cheated out of profits. they claim fox deflated the probability. the award includes 129 million dollars in punitive damages to deter become it from future conduct. fox filed a request to either correct or vacate the award.

2017, my cat he was ousted from 4 -- the founder was ousted amid allegations of sexual harassment. now back with a new startup and new funding. the start of the year announced a funding round wednesday led by rpm ventures. it provides home equity loans online in as little as five days. the real story here is that cagney got a second chance pretty quickly. what did he have to say about the allegations against him? >> he's just one of dozens of executives in silicon valley that had to step down on their positions as result of allegations of mistreatment at the company. i pressed him on what he has learned from his previous experience. i did a lot of reporting over the past couple of years about those allegations and he said he is very remorseful about what

happened. the problem is he let it grow too fast without determining what the culture was at the outset. there were allegations of sex ual misconduct nepotism and hiring as well as basically not promoting women as fast as they should. he said his new company spent a lot of time figuring out what the culture should be at the beginning. i looked at an internal document, 55 percent of the executive team are women, four 40% are women and minorities, four of the five cofounders are women. so he has clearly taken steps to improve the numbers. however, the company only has about 100 people, so the question is whether he can maintain that culture as the company grows. emily: clearly it a great time for women. this is a guy who was accused of creating a frat house culture that was especially toxic for women. there was the board investigation into a relationship that he had with an

employee. he lied to the board about it allegedly. he admitted he did have consensual relationships with female employees. >> he's saying it won't happen again. >> he is saying that will not happen again. it's interesting if you look at the advisors and board members, he has some high profile figures. emily: what are investors and it advisors telling about why they are backing him? >> he proved himself at sofi. emily: he built a business, but he got ousted from that business. is investors are taking a bet, wayne that risk against the ability of this company, which was valued at $365 million in the past round, more than doubled the last round. whether it can become the behemoth that sofi has become,

and become a unicorn in the space. so far the numbers have been pretty positive so investors are giving him the benefit of the doubt that he can rebuild the business that he did at sofi. it is expanding behind -- beyond home equity. it is following a similar playbook. so investors are betting he can re-create that success without the culture problems. >> it is a big bet. what does the competitive landscape look like? >> obviously there are be traditional banks that offer this but it's time-consuming and paperwork intensive. it typically takes 45 days some of the big banks recognize how slow it is so they are partnering with startups and working to provide online through their apps. there are also other digital upstarts. none of them are quite as fast as figure is, but obviously they are expecting a lot of competition in the market. emily: how has sofi been doing since he left?

there was a lot of work to do to get culture on track. >> there really has been a huge culture overhaul at the company. that took a lot of time. that firm is working on and having some trouble expanding beyond that core business of student loan refinancing. they want to reach every touch point of a lineal's unanswered -- millennial's financial life. that means insurance, wealth management, cash management. the numbers have not prevent whether they have been successfully able to penetrate all those other markets, but they are working on it. emily: selina wang, thank you so much for that report. that does it for this edition of bloomberg technology. you can check us out on technology. this is bloomberg. ♪

dana: hi, i am dana from the dana show. over the years, you have seen me interview some pretty cool people. right? today is no different. i'm speaking with dr. nathan bryan. he is one of the leading minds in nitric oxide research. one of the leading minds in the world. i recently went through a health breakthrough with my energy and stamina, for myself and my family as well. this guy is responsible for the science behind that breakthrough.