carol: welcome to "bloomberg businessweek." jason: we are here at bloomberg headquarters in new york. carol: this week, how theresa may survived the worst loss for a british government in more than 100 years but managed to keep her cool and keep working. jason: it is a great inside story. plus, how effective or not have trump tax cuts been for economic growth? carol: and i got another question for everybody.

can at&t's corporate mindset transform hbo? jason: our editor is here with us now. you and i were talking about this earlier this morning. >> this is one that was in the media world and is a big, big deal. this is how the at&t merger with time warner has been months coming. it got delayed because of the u.s. justice department. maybe not being willing to do this, and all of a sudden, it happens. on top of that, he steps down. now, all of a sudden, head of its popular show, game of

, coming to an end. not only is he out, at&t is the new overlord at hbo. the story is all about the tension. carol: it was about everybody be hbo.to be, everybody wants to netflix. jason: the night is dark and full of netflix.

>> they know that and this is an attempt to pivot and become much more of a streaming service that n a cable one. carol: we have got more on this story from our reporter. >> richard, longtime head of hbo. it is the end of an era. we tell everybody we are a media technology company. at&t now seizing control of time warner media and assets, is moving forward with this plan. the big plan for the future is that they want to roll out this direct to consumer streaming service. it will compete with netflix and pull in all this programming from other media assets.

hbo's going to be a huge part of this. what i wanted to set out to do is like, ok, hbo has been dabbling in this world of direct to consumer and straightening products for almost a decade now. yet, somewhere along the way, they fell way behind netflix. why was that? what is it like to work on the technology side of the business? what i found talking to people who have passed through hbo is that a lot of people have been both enchanted and ultimately frustrated by this challenge over the years, of trying to optimize hbo and the internet. a lot of it has been cultural. a lot of it has been, at key moments, things almost happened were you could almost see hbo really taking over the internet and owning the internet in the way netflix does. it is this fascinating counter history of what went inside. all of the programming was great and all of the innovations, widened that innovation translates to the consumer? >> it is so interesting, because we think about some of the

players and we were talking about it before we even came on air. i recall one line from curb your "curb your enthusiasm." the thing is that they really did own tv, but to your point, they mentioned a great quote. >> he has the famous quote he that netflix was rolling out house of cards, one of the biggest dramas. he said that we need to become hbo faster than hbo can become netflix. jason: that says it all. carol: but what does that mean? >> what that means is that netflix was this culture of data science, engineers, figuring out the signs of television. that is what they were good at. hbo was good at the art of television.

what is fascinating is that over the past five or six years, what you have seen is that netflix has mastered the art of television much faster than hbo has mastered the science. jason: one of the catalysts is the departure of that leader, so what is his legacy? >> the final season of game of thrones is coming up and people love it and hbo programming will be remembered fondly. at the same time, part of his legacy was that -- carol: did he miss the mark? >> he did not solve this very challenging problem that is they had solved. it would have been worth a huge amount of value. had they solved it, hbo would be more in control of its own destiny. jason: we just got the words for the u.s. cover story, now let's talk about the pictures behind it, the actual cover. joel weber and krista sends her

are here to talk to us about that. tell us about the hbo story. >> we knew it had cover potential from the moment we started to think about it. the images from game of thrones, its flagship show, are so arresting and powerful. and iconic. so, we wanted to lead into that. >> we start with this idea about the classic hbo title screen. >> you go from mergers cut deeper than swords, we're still not there. >> and that was like, maybe we can do this silly thing. >> where do you end up? >> after all the stuff, we were like, where is the fun energy? it brought us back to something like that would match up the business side and the game of thrones side in a way that is funny. carol: up next, how amazon is winning the influence game. jason: plus a high-stakes antenna battle over one of the most important spots in global financial markets, hint, it's in suburban chicago.

carol: later on, we survey recruiters. this is bloomberg businessweek. ♪

carol: welcome back to "bloomberg businessweek." jason: join carol and me every day on the radio from 2:00-5:00 p.m. wall street time. also catch up on our daily show by listening and subscribing to the podcast. carol: and of course, you can find us online. jason: the politics section takes a special look for into amazon's growing footprint and its clout down in washington , d.c. carol: we have got a chart for you, amazon's lobbying efforts are now second only to google. oracle, facebook, amazon in second place in terms of spending and lobbying. google takes first place. jason: you can see them all accelerating genetically.

-- dramatically. what is also accelerating is what they are lobbying about. amazon, look at that. these are the policy areas for which amazon has hired lobbyist s all the way down 2018. they are not going to endorse for everything. carol: covering all of the issues. we got more on this story and amazon's growing influence. >> among the top competitors, amazon outspends almost everyone except for google. last year, it broke a record for its federal funding by spending more than $14 million. jason: we talk so much about influence in money in washington. as you said, the numbers are pretty high. it is also this world of and

government people, other lobbyists who have been working for other companies. this is very inside the beltway. >> what amazon has done lately is hired people with connections. either congressmen or folks in federal agencies that might be able to help it achieve its business priorities. for instance, now that the house democrats have taken power in the house, amazon has hired a couple of lobbyists. it is likely to be raising questions about the company's diversity. amazon is also hiring folks in the antitrust space. right now, they are increasing questions being raised about whether amazon is too big. amazon has poached people with connections to the justice

department who could help it navigate any sort of antitrust inquiries. carol: it is interesting that in its pursuit of doing more lobbying, it is not necessarily aligning with some of its tech brethren. you've got a couple of business ventures, one is accessing more of the government to get on to the amazon clad. dutch amazon cloud. cloud.amazon and then we have got what amazon wants to be, a portal for the government to buy all of the things that it needs. >> yes. amazon is trying to dominate lots of sectors across various industries. one of those sectors is the federal market. we see that in two cases. one is the pentagon deal that you alluded to, a $10 billion contract. not only will the winner get all of that $10 billion pie, they

will have a lead in that market to get future business from the department. also, the general services administration is creating a new program to help federal agencies by products like office -- buy products like office supplies. amazon has a lead in that contract as well. other competitors like oracle and ibm have been fighting tooth and nail in washington. leadg to unseat amazon's in those areas. that has created conflict, especially in trade groups in which those companies would normally be aligned on policy. what we have seen is really like a civil war in some of those trade groups, and amazon lately

has been winning. jason: stock traders have spent years and piles of money to try to shape millions of a second a millionth of a second off of each trade. carol: that race has led to a battle over communications towers. >> the world's biggest exchange, a giant market cap company. the stock market on the other hand was based on several data centers in new jersey if you want to be a trader you have to have a superfast medication or. superfast means of communication. they wrote about this company

that laid a fiber-optic line between chicago and new jersey that was faster than other available means. it was a huge deal and traders fell on money using that service. quickly, the service became obsolete because they realize that you can send information much faster. 50% faster in using microwave radio transmission. over the past decade, they have been building microwave networks to shoot information really fast. >> this latest story is about the fact that those networks have gotten really good and people have inched their radio centers because it gives them an edge. the more it stays in the air, the faster they are the faster they are over competition. carol: put the airspace has to

be clear, right? >> yes, so the data center built a new tower that is right next the data center, and the point is that people can put their dishes on there and it will be closer. it'll get rid of all the gamesmanship to drive by land. another company announced plans to put their own tower right across the street. cyrus one says that towers going -- tower is going to be in the way and will ruin their plans to level the playing field. carol: we mentioned there were politics involved. tell us about that part of it. >> is one of the fascinating things about this. with these networks, they go across the country. there are lots of minutes of -- to deal with to get permission to build a tower or certain land. in this case, the city of aurora initially turned down the plan to build their own tower. but they did a little lobbying behind the scenes, perhaps with help from the mayor, the city

council flipped. actually voted a couple months later to change their mind and approve tower. jason: up next, everything is awesome for private equity until it is not. my take away from the most important annual gathering. carol: we have got the giants trying to rekindle some ge old magic that repeating the company's mistakes. jason: and how much this tax -- does tax policy influence corporate investment? carol: this is bloomberg businessweek. ♪

jason: welcome back to "bloomberg businessweek." carol: you can listen to us on the radio. 106.1ius xm channel 119, in new york, washington, d.c. jason: in the bay area and london and through the business app. carol: this week, you are the you were at the davos of private equity.

jason: the super return conference in berlin. everybody dutifully goes there, 2500 people descending on the german capital. it gave us a good chance, i was talking with joel weber, to really remind people how think influential it is. check out this chart that breaks it down. these are firms you have heard of. these are their assets under management. listed there, that is how many people work for companies that they own. carol: also, $1.2 trillion a day they're looking to put to work. jason: definitely top of mind for everyone. what is so interesting is that moments after this went to press, as it was going to press, a good scoop from bloomberg how blackstone has already got $20 billion lined up. carol: and got more money to put to work. jason: upbeat.

a lot on the horizon. carol: great story. speaking of private equity, titans in the finance section with a story about apollo global. jason: that's right, potentially recreating what used to happen at general electric without the taxpayer bailout. carol: our reporter has that story. >> apollo is one of the biggest private equity firms and is known for buyout prowess aired . it is not known for what it is much bigger in -- credit. now, they have multiple insurance companies, they have a stake in directly in a mortgage -- indirectly in a mortgage lender. they have commercial real estate lending, they actually lend to deals for other buyout firms that are much smaller. they have a huge conglomerate that operates in lending markets that are unregulated. >> part of this happened because the financial crisis, big banks

got out of these businesses and some much more lightly regulated firms like apollo. why has apollo been so especially successful? >> because of his leadership. they came from the junk-bond titan. they know these markets, but on top of that, even on assets led from the banks, talent also left, so the person who runs the business was formerly at citigroup. he knows these markets well and has brought on city talent as well. even the banking talent has moved over to these firms. carol: your point is that this guy once stood created the capital of tomorrow.

formerly was looking at ge capital assets. >> something interesting about this is that they would tell you that this is a metaphor. could have said citigroup, he could've said anything else. they said that after adding 500 billion, they are selling the assets. maybe one of the small group of players that can take these assets on. carol: what is it about seltzer and apollo that they would make their level work? >> the insurance is no small piece of this. it is something they're trying to replicate. carlisle is trying to get into the business as well. they are able to invest in credit assets more heavily. this is a huge part of the

industry. now, they are expanding globally and that headstart is helping them catapult above everybody else. carol: in the economic section, we have a scorecard for president trump's tax policies. jason: showing that they have done little to boost growth and tax rates may not be that important when it comes to corporate investment. >> this is a very hard thing to measure. people are taking a stab at it and the range of investment and impact is quite broad. that said, i put a lot of time to looking at promises from the white house. we have heard about consumer spending will give her about investment. but are we actually going to see this second piece from investment? the takeaway is yes, it's just not very big. this plays into the supply-side argument a little bit that you will see something from tax cuts, but also puts a cap on it. even if you get something, we are only talking about .1

percentage point of growth. jason: carol was an economies major, i was an english major. this is where it would take a step back and you remind us of the supply and demand side, basic definition. >> they believe that if you deregulate and give tax cuts it will incentivize businesses to invest. their view is that what is keeping businesses from investing is the government demand-side will tell you that that matters, but what matters more is where we are in the economic cycle. that is the framework we started with and we put together a model that looks at both things. turns out, demand-side wins in this case because the demand-side capacity complaints output gap, those things matter much more than tax cuts. carol: it is important to have this discussion because, as you say, the white house has come up with estimates saying hey, we did this, businesses are spending and look what it did. and as you said, there are lots of different estimates out there, so we kind of have to be smart. >> absolutely, and it is hard

because there are so many estimates. the things are so easy to fudge and the models are all different. i think the important thing to note is that, the results came out, i would not say to my expectations. we did standard scientific theory, testing a hypothesis. when you get these kind of things that support these hypotheses and supports your result, it's like you are trying to build a house out of bricks. these results are similar to results others have found which makes me think that, ok, there's something going on. it is leading them to maybe put bigger numbers around their tax cuts than maybe they deserve. i think that is an important thing to understand as we enter into a phase with the deficit is widening substantially. did we get what we pay for? carol: later in our program, the fueled inauguration

president trump dreamed about. jason: and theresa may pushing past a historic brexit defeat. carol: this is "bloomberg businessweek." ♪

>> welcome back. schooll ahead, the businesses take most attention to. >> fitbit tells us about the country's future plans. story international cover . after the brexit

guilt suffered a defeat, she is pursuing a second attempt to get ade parliament to deal. >> we move from day-to-day but theresa may staying cool and collected. >> she is still there even though she suffered perhaps the worst defeat in history, certainly for a hundred years. the one piece of political decision making she did to win on, her brexit deal, she still does not have a deal that has got to the house of commons. she is going to try again on march 12. u.k. is due to leave a couple months after that. jason: what i love about this story is you take us inside downing street and into the mind of theresa may. so much of what has happened reflects what it is at record.

learned?of you tim: what we found with officials who worked with her in the past and now is it is difficult to get inside theresa may's head. she's a private person. she lost both her parents when she was in her 20's, that her husband at university and has been with her ever since. he is the one man on the planet who can claim to know what theresa may might do. they are a tight couple. they do not have kids and they rely on each other. she relies on him. the two policies her colleagues identify as being the key to her survival are her pierce events -- perseverance and fortitude. she has come through political pain in the last couple years since she has been the u.k. prime minister and is still there soaking it up and plowing ahead. i still like her pierce

severe and and fortitude, you wonder if she will be able to carry brexit through the finish line. what are you hearing in terms of how it plays out? tim: it is not impossible, whether negotiations are in brussels. there are two sets of negotiations. one is the u.k. talks on whether it can get a different deal out of brussels and the other is theresa may's negotiations with her conservative party in london. that is the key because if she can persuade enough of those hard-won. brexit supporters in her conservative party to back down and support her deal, she has got a chance. dead.t them, her plan is we are going to find out in a few days when a vote comes how bad it gets. jason: help us understand and you do and you do a nice job of this, the key issue between the u.k. and the negotiators in

brussels. is this irish backstop? we read about it. remind us what that is. tim: you have to take a look at the island of ireland. there is northern ireland and the republic of ireland. when the u.k. leaves the european union, northern ireland leaves. then you have a real issue at the border. what happens? open and frees flowing. there is no need to customs check. but the peculiar history of northern ireland politics is a violent one and the concern is lacedt border becomes with borders officials, it will revive memories of the kind of checkpoints there in the past spark sectarian unrest between communities.

the backstop was the agreed compromised to do just that and what it means is the u.k. as a whole stays inside the european union customs union for as long as it takes until in -- a new author can be found. carol: pay attention quickly. what are the dates investors need to be focused on? tim: next tuesday is the date where we expect theresa may to put a revised brexit deal back before the house of commons to vote on. after that we have another vote of the 13th of march. we expect when the comments will decide if they rejected her deal . .hat point, they will decide the next day on the 14th, there will be another vote, a third

vote in the week next week on to extend those negotiations, to push spec that deadline and delay brexit. next, why federal prosecutors are scrutinizing how involved president trump was in planning and not duration festivities. carol: the american economy developing a booming business. jason: this is bloomberg businessweek. ♪

jason: welcome back. carol: join us for uber

businessweek every day on the radio. you can catch us on our daily show. check in our podcast and find that at bloomberg.com. jason: find us online at is thisweek.com. an era of gang violence has given rise to a thriving coffin business. carol: one city is getting a reputation. here is more from jeff musket. is one of thedor worst sites of homicides per capita. it is supposedly the highest rate in the world. this traces to gang violence has been exacerbated by ms 13 and barrio 18 over the last eight incomingan administration blew up a brief

a short-lived ones. it was broken by the catholic church. detailsou bring us about this. brothers were in a different business before they got into making coffins. jeff: they were running a bakery. two of the three brothers have now tried to take the money they have made first by selling coffins on their own and then by buying coffins from other sources and renting a funeral intor to make the parlor what was once their bread oven to make the principal involvement facility for the surrounding area. carol: this is a country, an

individuals, the average family does not make a lot of money. jeff: the brothers who are inning the funeral parlor the quad but, there are other brother and dad have gone off to start another -- a different business. they are making between 2000 and 4000 dollars in a month. by us ofecent pay day dorian standards. successfuleing selling coffins, the insulate themselves from the violence that surrounds them because these gangs often prey on the economically disadvantaged? jeff: it keeps them from standing up in a certain way. there are cop and makers -- coffin makers. there are so many factories running all the time. he keeps margins down enough

int you are not standing out a viable targets. carol: what struck the individual there on the ground? what strike him as he was doing this story? -- struck him as he was doing this story? jeff: the thing that was most shocking him was how accustomed to this year gore the brothers seemed -- sheer gore the brothers seemed and their relative comfort with death. one of the brothers is that a funeral for his lifelong town's friends. jason: the white house denies president trump made a role in his inauguration planning. involved, veryas involved in fact down to the tablecloth. jason: the event is being looked at by federal prosecutors. this is about planning a

party, huge party the dust party, a party that cost $100 million. an effort is under a bunch of investigations. the latest is the letter from the house judiciary committee areng questions but there also federal prosecutors in new york and attorneys general in defeat and new jersey who were looking in a broad-based way of how the committee for the inaugural party raised the money, deploy the money. was $107 million. >> about twice as much as obama's, which had been a record before it. the white house has recently said trump had nothing to do with the planning of the party in his honor. we knew from sources around the campaign, the transition and the

inaugural but that was not quite true. we set up to tell the story of how trump helped plan his own party. jason: anyone who has been following trump as president, candidate, businessman of the last 30 years probably could ascertain that he is going to be involved because he is a showman . he understands the power of visuals and -- tell us how he got involved. he went deep. >> he went very deep. some brought top-level things, so as they were planning this coming he would call his good friend come a chairman of the inaugural in real time as they were having meetings trying to figure stuff out so he could weigh in. he also was curious for a while in the idea of selling exclusive rights to either some or all of the inaugural.

that: president obama did too, didn't he? parts ofsold certain the hbo and abc. that would not have been unprecedented. he personally called the president of cnn where he discussed it might be cnn and fox. no exclusive rights deals ever came to fruition but a lot of discussions were taking care of trump -- taken care of by trump himself. carol: what -- where did the problem arise? he cares about these things. make the connection for us. >> that is reasonable. becomes weird -- it becomes weird when sarah sanders denied he had anything to do with this other than going to the balls, raising his hand over the bible,

and everything. easily does a weird preferable thing to say. you have to wonder if interim exposes them in any of these broad-based investigations. carol: that is where the money was raised or whatever. questions arers' so broad now. they are asking about how the money was raised, how it was spent, interactions with donors. it all seems to me on the table. carol: up next, a business school they get to the best career. jason: plus, the next generation of products. carol: a chef offers rooms to stay the night. ♪

carol: welcome back. i am carol massar. jason: i am jason kelly. you can listen to us on the radio. 106.1 in boston. carol: a m naik 60 in the bay area. and of course on the bloomberg business app. in the solution section inside job recruiters on the best business goals. jason: an editor walked us through the latest look at the be school rankings. >> it is about the jobs ultimately. even if you are aspiring to start your own business, most of the time you are going to get experience and then apply that. what recruiters think and what they are looking for and candidates is important. that we built, the global ranking came on.

decemberl ranking in and this was a deeper dive into several key questions about what recruiters are looking for and they are assessing the quality of the candidates from which schools they are coming from and that is what leads to these many rankings. jason: it is interesting because i looked at this and thought, before i dove in, thought it is going to be the same names. it is not. -- we picked these six questions we felt were important so this is by no means like every single question and category they looked at. there are differences and you will see many schools pop up on these that are not in the top five or 10 of these global rankings. we are in the top 30 because that was the selection we made. we applied these questions across the board to each of them and came up with these results. what i find interesting

is the trends we have been talking about, innovation, entrepreneurship, diversity. >> creativity and innovation, absolutely more and more which goes hand-in-hand with aunt dorset. what are the ways in which individualsenabling to go beyond the basics and break out of that and be creative thinkers and apply interesting problem-solving solutions with things they are coming out with. jason: before we get too far away from schools, tell us about stanford. you mentioned to see georgetown representative -- represented well in a number of categories. you mentioned the international names. what did seem to -- what were you able to elicit trend wise in terms of who popped up more repeatedly from the recruiters? surprising that

stanford diplomat on top in several categories of because that global ranking results, you see the connection. stanford, very tech driven some of the innovation front them on the entrepreneurial front and underpin oil in terms of what are you teaching but also in terms of what do we actually see? jason: every week we are going deep with a gust. we--guest. we put it out as a podcast. this week, we are joined by james park. carol: the company came out with new devices, different goals and it aims to keep ahead of a crowded field. jason: here is part of that conversation with james park. we announced a a few new products and inspired h r, which are affordable cost trekkers.

to come ourf successor to an amazing kids product we launched last year. carol: tell us about the strategy and where you see fitbit going as a result of new products. dimitria -- james: a large focus is about growing our active users. last year we grew active users 10% to 28 million active users. there are a strategy is to increase the number of numbers we can have. carol: i am curious about, once you get a user, how sticky is it? how often do they stay with you? james: health and fitness is a challenging thing for people to stick with but we have been happy with the attention of our users. that is a testament to the innovation we are bringing, both hardware and software. carol: what is the retention

rate? james: we do not break that out. carol: but you are happy. james: it has been improving new time as we roll out features. let's talk about the software side because you mentioned this paid premium products coming up later this year. i am wearing my ionic now. i use the app frequently to check in being a data geek. what needs to come for that, how do you get people more objective to the app. scores. what do i do with the data? it will be about coaching, guidance and remember content around nutrition, mindfulness, etc. and bringing together holistic solutions that tells --

what should i do next? carol: for more of our chat with james park, check out our podcast. find it wherever you download your podcasts and at bloomberg.com. pursuits take a special focus on upscale food trends. carol: including how chefs are building hotels to complement their foods. >> you have seen restaurants in hotels but it is getting hard to be in the restaurant business. rents arising. minimum wage is going up. chefs have been clever about figuring out other ways to make money and one is to cut out the middleman and open their own places. it is working. some of them have new models, so a couple of them had been in the bus this -- the business for a while. one opened a country in france and he has at least one more

property. it has not worked out too well for gordon ramsay who opened a place in london and had to close it. presumably he yelled at himself. it is cool because you see more chefs decide they want to be the property owner. carol: it is smaller properties, right? exhibit a of that is a chef called henrique. he has a restaurant in mexico city. he opened up this tiny place. it is like an airbnb. it is an apartment above his original restaurants. it is light and airy, plant filled and they make you breakfast and you can hire the chef to make you dinner and it is a great way to immerse yourself. the margins are better on the hotel business. kate: the margins on a

restaurant are less than 15%. if you have a hotel, it goes up to 30% and if it is the destination outside the city where you can combine them where you have customers who are not going to leave, gets a body. carol: bloomberg businessweek is available now. jason: and also online and on our mobile app. carol: i want to maintain a relationship, i have got to say jason's remarks. the private equity industry -- and theo grow in whole investment environment is not to be missed. joel weber assigned that story to me. my favorite story, nick baker in chicago talking about that little spot outside chicago where so much is happening. it took me back to flash floods. -- you carol: i love that story as

well. jason: check out our podcast. subscribe. carol: more bloomberg television starts now. ♪ you.

all of you. how you live, what you love. that's what inspired us to create america's most advanced internet. internet that puts you in charge. that protects what's important. it handles everything, and reaches everywhere. this is beyond wifi, this is xfi. simple. easy. awesome. xfinity, the future of awesome.

david: you wanted to go into technology banking. robert: like all things, in the land of the blind, the one-eyed man is king. david: were there a lot of african-americans in the technology area at that time? robert: very few. very few. david: what propelled you to say i am going to give this all up and go start my own company? robert: very few software companies were actually efficiently run. we took these kernels of best practices. david: you became very involved in philanthropy. robert: philanthropic endeavors were a part of my family and my family dynamic. one thing we have to do is ensure that society is a just society. >> would you fix your tie, please? david: well, people wouldn't recognize me if my tie was fixed, but ok. just leave it this way. alright.