>> welcome to bloomberg businessweek. >> we are here at bloomberg headquarters in new york. how theresa may survive the worst loss for british government and more than 100 years and managed to keep her cool and continue working for a brexit deal. jason: a great inside story. how effective have the trump tax cuts been for economic growth?

carol: i have another question for anyone. can at&t's corporate mindset transform hbo? jason: will hbo be hbo without its kingmaker? joel weber is here with us. you and i were talking about this earlier this morning. worlds was in the media and is a big deal. this is all because of the at&t merger with time warner that has been months coming. got delayed because the u.s. justice department was maybe not willing to do this. then it happened. he has been the architect of the ahead of game now of thrones coming next month not only his he out but at&t is the new overlord. the story is about the tension. >> it was about everyone wanting

to be hbo or netflix. >> the night is dark and full of netflix. hbo knows that. pivot and attempt to become much more of a streaming .ervice >> we have more on this story from felix gillette. >> longtime head of hbo resigned this past week. >> 27 years of the company, long time. >> end of an era. they said hbo is a media company not a technology company. along comes at&t which is seizing control of warner media and all assets and moving forward with this plan. for the future is in part that they want to roll consumerdirect to

streaming service by the end of the year that will compete with net what can pull in all this programming from the warner media assets and hbo will be a huge part of this. to say, ok hbo has been dabbling in this world of direct to consumer and streaming products for almost a decade now. theyhere along the way fell way behind netflix. what is it like to work on the technology side of a business that says we are not a tech company/ -- company? a lot of people have been in chanted and ultimately frustrated by this challenge over the years of trying to optimize hbo on the internet. a lot of this has been at key moments, things almost happen

for you can almost see hbo taking over the internet and honing the internet in a way netflix now does. it is this fascinating counter history of what went inside hbo. all the programming was great and the innovation was happening on program side. why did that innovation not translate to the consumer and streaming products? >> you think about some of the players here. we were talking a little bit before we came on air. i recall a line from curb your enthusiasm, a great hbo show where larry david says " what do you mean it's not tv it's hbo?'s tv." kevin sorrento set it up. in 2013d a famous quote around the time netflix was rolling out house of cards of their first big dramas, hbo

style programming. he said we need to become hbo faster than hbo can become netflix. that says it all. >> what does that mean? >> that means that netflix was this culture of data science, theneers, figuring out science of television and that is what they were good at. hbo was good at the art of television. over the past five or six years you have seen netflix master the art of television much faster than hbo has mastered the science of it. what is his legacy here, he was a taste maker in a lot of ways? >> he will take a well-deserved victory lap with game of thrones coming out. the final season coming out in april. people love it and it is a great program.

hbo programming will be remembered fondly. was -- his legacy >> are people going to say he missed the mark? >> he did not solve the challenging problems that if he had solved it would have been a huge amount of value. if they had hbo would be more in control of its own destiny. to would not be vulnerable at&t's vision. let's talk about the pictures behind the cover. is here to weber talk to us about it. >> we knew it had cover potential from the moment we started thinking about it. arees from game of thrones so arresting and powerful. we wanted to lean into that.

>> we had this idea of the classic hbo title screen with the static. go from mergers cut deeper than swords. >> we had this silly thing where we played with the logos while talking to each other. >> where do you end up? >> after this we thought about where is the fun imagery of game of thrones. a matchup of the business side and the game of thrones side in a way that was funny. is winning theon influence game when it comes to washington dc. a high-stakes antenna battle over the one of the most important spots in global markets in suburban chicago. carol: we survey the recruiters of the top 10 business schools. >> this is bloomberg businessweek. ♪

carol: welcome back to bloomberg businessweek. jason: join carol and me for bloomberg businessweek every way it -- every day on the radio. listened and subscribe to our podcast. find us online at businessweek.com and on our mobile app. jason: the politics section takes a special look into amazon's growing influence and clouds in washington dc. amazon lobbying efforts, only second to google among technology companies. ,racle, microsoft, facebook amazon in second place on spending in washington. google takes first place. >> you can see it all accelerating dramatically.

what is accelerating is what they are lobbying about. that has changed her medically. these are the policy areas for which amazon has hired lobbyists by year. they are not going to -- carol: covering all the issues. fascinating charts. more on this story and amazon's growing influence in washington. tech competitors amazon out spends almost everyone except for google. last year it broke a record for federal spending, more than 14 million last year. that was up from more than 12 million the year before. lobbying.e a sizable >> it is interesting because this is a reminder. so much about influence and money in washington. the numbers are pretty high but it is also just this world of x

government people, other lobbyists who have been working for other companies. take us inside the effort here. it is very inside the beltway it feels like. lately amazon has done is connections to either congressmen or folks in federal agencies that might be able to help it achieve business priorities. now that the house democrats have taken power in the house amazon has hired a couple of to the black congressional caucus which is likely to raise questions about diverse city. in theis hiring folks antitrust you there are questions being raised on whether amazon is too big. whether it is being anti-competitive.

amazon has poached people with connection to the justice department who can help it now to get inquiries here in the capital. thatat is interesting is in its pursuit of more lobbying in washington it is not necessarily aligning with some of its tax brother and. a big part of the reason why is you have a couple of business ventures. one is accessing more of the government to get onto the amazon cloud. a big $10 billion contract with the pentagon. you have amazon wanting to be a portal for the government to buy all the things that it needs. dominate is trying to 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 you alluded to.

will the winner get all of that $10 billion pie they a future for more business. program to help federal agencies byproducts like office supplies or furniture is. a lead in that contract as well. other competitors like microsoft and oracle and ibm have been fighting tooth and nail in washington to unseat amazon's lead in those areas. that has created conflicts. ,specially in trade groups those companies would normally be aligned on policy. what we have seen is really simple and some of those trade groups. amazon lately has been winning that. have spentk traders

years and piles of money using shaveds to try to millionths of a second on each trade. battlethat has led to a on communications towers outside of chicago. here is baker. the world's biggest futures exchange, more than 60 billion market cap company, there'd data -- the stock market is based in several data centers in new jersey. if you are a traitor and you want to be a player you have to have a superfast communications network in between the aurora data center and the data center of new jersey. over the years, michael lewis wrote about this in his book a couple years ago about a company that laid a fiber-optic line in between chicago and new jersey that was faster than other available means of conveying information. very quickly that service became

obsolete for traders because they realized you can send information 50% faster through the airwaves using microwave radio transmission. over the past almost a decade they have been building these microwave networks to shoot information fast between the chicago suburbs and new jersey. is about the fact that those networks have gotten really good and people have inched their radios close to the data center because it gives them a dead. the morer they are their information stays in the air and the faster they are and the more of a net they have over competition. >> but the airspace has to be clear, right? >> that's right. the owner of the data center in tower, they built a new right next to a data center. the point is traders can put their dishes out there and that will get rid of the gamesmanship.

the thing that got thrown into the equation was another company that announced plans to put their own tower across the street and the owner of the data center says that tower will be in the way and ruin the plan to level the playing field. >> i imagine there were politics involved, tell us about that part of it. >> the fascinating thing about this is with these networks they go across the country. there are lots of municipalities you have to deal with to get permission to build a tower. the city of aurora turns down plans to build their own tower. they did a little lobbying. cityhelp from the mayor council flipped and they voted a couple months later to change their mind and approve the tower. jason: up next, everything is awesome for private equity until it is not.

my take away the industry's most important annual gathering. ge trying to rekindle some of their own magic without repeating mistakes. >> how much does tax policy influence corporate investment?

jason: i am jason kelly. carol: i am carol massar. you can listen to us on the radio on sirius xm and a.m. radio. we are in the bay area and london and through the bloomberg business that. carol: jason you wrote the remarks. you are at the davos of private equity. jason: the super return conference in berlin every february.

2500 people descending on the german capital. , i was us a good chance talking to the editor to remind people how big and influential this industry is. .heck out this chart these are firms you of heard of, black field, brookfield. listed there, that is how many people work for the companies they own. >> i also look at the global pe drive pattern. $1.2 trillion they're looking to work. what is so interesting about this is moments after this went to press, as it was going to press a good scoop for my bloomberg reporter about how blackstone has $20 million lined up for their next fund. >> they are very upbeat overall. jason: not a lot on the horizon. of privateking

equity, titans in the finance section. we have a story about apollo global and its plan to become the next ge capital. jason: potentially reiterating what used to happen at general electric. apollo is one of the biggest private equity firms in the world and it is known for its buyout row us. -- buyout prowess. they have multiple insurance they have a mortgagor lender come of a lens to deals for other bly -- buyout firms. operating in money markets that are unregulated. a lot of big banks got out of some of these businesses and in

stepped much more lightly regulated firms like apollo and blackstone. why has apollo been so especially successful here? >> partially because of his leadership, josh harris, leon black, they came from a jump on titan. they know these markets. from the large banks talent also left. im selzer was formerly at citigroup. he has brought on citigroup talent. >> this guy wants to create the ge capital of tomorrow. ofcifically looking at some the former ge capital assets. something interesting about this , he could a metaphor have said cit. he could have said anything else really. aftering about ge is

having 500 billion in assets it is selling a lot of those assets. as some of these assets come to market apollo is in a good position. a small group of players can take these assets on. >> what is it about apollo that they will make their version of ge capital work when we saw what happens to the former ge capital? >> the insurance piece of the puzzle is not a small piece. it is something equity firms are trying to regulate. capitalg the permanent they are able to invest in credit assets more heavily. this is a huge part of their strategy. they got into it after the crisis. now they are expanding globally. that headstart is helping apollo catapult above everyone else. carol: we have a scorecard for president trump's tax policies. jason: bloomberg analysis showing they have done little to boost growth.

tax rates may not be that important when it comes to corporate investment. >> we have more from economist tim 80. >> this is a hard thing to measure. the range of impacts is quite broad. into lookingf time at, we have had a lot of promises from the white house about what this will do for the economy. we have heard about consumer spending and investment. are we going to see that second piece, a boost of investment? the takeaway is, yes, just not very big. this plays into the supply-side argument a little bit. that you will see something from tax cuts. inputs a bit of a caps on even if you get something we are only talking about tens of a percentage point to gross last year and this year. >> carol wasn't an econ major and i was an english major. this is where you remind us of supply side and demand side, the basic conditions.

>> supply-side economists if you deregulate and give tax cuts that that will help incentivize businesses to invest. they think that keeping businesses from investing is the government. what matters more is where we are in the economic cycle, is there demand for those products? that was the framework i started with and we put together a model that looks at both of those things. it turns out demand siders win. that is because these demand-side capacity constraints matter much more than tax cuts. >> it is important to have this discussion. the white house comes out of estimates and says look we did this and we cut taxes. look at what this did to the economy. i think they said a full percentage point. as you say there are lots of different estimates so we kind of have to be smart when we hear this stuff. aret is hard because there

so many estimates and these things are easy to bunch around the margins and the models earl different. the important thing to note is the results came out not to my expectations. we did standard scientific very here. when you get these kinds of things if you can find other work that supports these hypotheses it is like trying to build a house one piece at a time. these results are similar to the results others have found which makes me think there is something going on in the white house that is leading them to put bigger numbers around the tax cut than maybe they deserve. that is an important thing to understand as we enter into a phase where the deficit is widening substantially which is rare. did we get what we paid for? >> the rockettes field

inauguration president trump dreamed about. jason: how theresa may pushed past the historic brexit defeat and kept calm and carried on. carol: this is bloomberg businessweek. ♪

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jason: welcome back. carol: the business school's recruiters play the most attention to. >> the ceo of fitbit tells us about the company's future plans and new health trackers. carol: the consistently persistent and coolheaded theresa may.

>> after her brexit deal suffered a historic defeat she is preparing a second attempt to persuade parliament to back her deal. this story just keeps on giving and i feel it we move from day to day but behind it all theresa may staying calm cool and collected. two months ago she suffered one of the worst of feats in the history for a hundred years that any government has suffered. the one piece of political decision making really needed to win on. it was her brexit deal. she will try again on march the 12th. the u.k. is due to leave a couple of weeks after that with or without a deal we still don't know. >> what i love about this story is you really take us inside downing street and into the mind of theresa may.

so much of what happens reflects essentially who she is at her core. tell us what you learned. >> what we found through talking to ministers in the cabinet and outside and officials who work it is past and now difficult to get inside theresa may's head to understand what she is going to do. she is a private person and lost both of her parents when she was in her 20's. she met her husband that university. he is the one man on the planet who can claim to know what theresa may might do next. they do not have kids and they rely a lot on each other. she relies on him as a chief advisor. the two qualities they identify as key to her survival are perseverance enter fortitude. she is still there soaking it all up. perseverancee are

-- you do wonder if ultimately she will be able to carry brexit through the finish line. what are you hearing in terms of how it plays out? >> it is certainly not impossible. therer negotiations -- are two sets of negotiations going on. whether you can get any sort of different deal out of brussels. if she can persuade enough of those hardline purist brexit supporters in her conservative party to back down and support her deal than she has a chance. them her plan is dead. we will find out in a few days time how bad it gets for theresa may. job of this ince the story, help us understand

the key issue between the u.k. and the negotiators in brussels in this irish backstop. i feel let we read about it all the time. >> you have to look at the island of ireland. there is northern ireland which is part of the u.k. and the republic of ireland which is an independent country and a member of the european union. when the u.k. leaves the european union northern ireland leaves. then you have a real issue at the border, what happens? currently it is open and free flowing, goods can't come and go and there is no need for customs checks. history of northern ireland's politics is very violent as we all know. the concern is if that border becomes policed with border officials and customs officials of the revive memories checkpoints that were there in the past and potentially cause more sectarian unrest between

the communities of ireland. that is what people want to avoid. the backstop was an agreed compromise to do just that. it means the u.k. as a whole stayed inside the european union customs union for as long as it takes until a new answer can be found with the trade deals, meaning there is no need for that hard border infrastructure that is going up area >> really quickly i feel like we keep moving around dates and all that. what are the dates investors need to be focused on? >> next tuesday the 12th of march is the big date and we are expecting theresa may to put a revised brexit deal back. we have another vote on the 13th of march when the commons will decide if they reject her deal or if they want to take britain out of the european union with no deal at all. 14th therey on the will be another third vote on

whether to extend those negotiations to push back the deadline and delay brexit. why federal prosecutors are scrutinizing how involved president trump was and planning his inauguration festivities. carol: the central american economy developing a booming business. jason: this is bloomberg businessweek. ♪

jason: welcome back. carol: join us for bloomberg

businessweek every day on the radio from 2:00 to 5:00 p.m. wall street time. you can catch up on our podcast. online at businessweek.com and on our mobile app. in el salvador an era of gang violence has given rise to a thriving coffin business. carol: one city is getting a reputation as the city of coffins. for grim reasons el salvador has seen one of the worst sites .f homicide per capita supposedly the highest rate in the world. violencees to gang that has been exacerbated 13 and barrio 18 over the last few years. as the incoming presidential administration blew up a brief

come a fairly short-lived one of a few years between the two gangs brokered by the roman catholic church. >> you bring us very vivid details about this. take us to the story of the were in a very different business before they got into making coffins. >> they were running a bakery and what is now their funeral and two of the three brothers have now tried to take the money they made by selling coffins on their own and from buying coffins for other sources and running the funeral parlor -- their bread oven making at the principal involvement facility for the

surrounding areas. >> forgive me for getting into the financials. wheres a country or area the individual and average family does not make a lot of money. i'm curious about this as a business. >> the brothers who are still , theng the funeral parlor other brother and their dad have gone up to start a different business in el salvador. $4000 in aking typical month. it is a decent payday by el salvador standards. >> successful by selling coffins they insulate themselves to some extent from the violence that is around them. pray on theoften economically disadvantaged. >> it also keeps them from standing out in a certain way. the coffin makers or the men who talked over the story, there are so many factories running all the time.

it keeps margins on the bare-bones models down enough that you are not standing out as a particularly viable target for gang activity. >> what struck the individual there on the ground as he was doing this story? i'm curious of the conversations you had about it. howhe most shocking was accustomed to the share gore and grisly nature of the job that the brothers seem. with and's use relative comfort with death up until you get into the last scene of the story where one of the brothers is at a funeral for his childhood friend. jason: online this week, the white house denies president trump later role in his inauguration planning. carol: simply put, he was very involved. down to the table cloths and the rockettes. >> now it is being looked at by federal prosecutors.

planning a party, a huge party, a party that cost $100 million around the inauguration of then president elect trump. the inaugural effort is now under a bunch of investigations, the latest is the letter from the house judiciary committee asking questions. there are also federal prosecutors in new york and attorneys general in dcn new jersey who are looking in the broadbase away at how the committee for the inaugural cardi raise the money and deployed the money. >> it was $107 million, a record. about twice as much as obama's which had been a record at 53 million. recently saide 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. that was not quite true. we set out to tell the story of how trump helped plant his own party. has been falling trump as president or candidate or businessman over the last 20 or 30 years probably could ascertain technically that he is going to be involved. he is a show man. he understands the power of visuals and tell us how he got involved. >> he went very deep. some broad top-level things. as they were planning this from the earliest days, he calls his good friend who is chairman of the inaugural in real time as they were having meetings and trying to figure stuff out. he also was very curious for a while in the idea of selling it was of rights -- exclusive

rights to broadcast companies and his favorite for a while was fox. to be fair, president obama did that to certain parts. >> obama sold certain parts to hbo and abc. that would not be unprecedented. he personally called the president of cnn where they discussed where it might be cnn and fox. no exclusive rights deals ever came to fruition. a lot of the discussions were taken care of by trump itself. >> that alone is not a problem. where does the problem arise? >> he likes to party. >> where does the problem -- make the connection for us. >> that is totally reasonable. it only becomes weird when trump's spokeswoman sarah huckabee sanders denied he had anything to do with this other than going to the balls and

raising his hand over the bible and everything else. is a weird relatively easy .escribable thing to say that in turn exposes him in any of these broadbase investigations going on. >> in terms of how the money was raised or whatever. questions arers so broad right now it is hard to figure out what exactly they are at her. we do know they are asking how the money was raised, how it was donors,nteractions with it all seems to be on the table. >> choosing a business school that gives you the best career advantages. next generation of products. we talked to the ceo. >> a restaurant trend where chefs stay the night. this is bloomberg businessweek. ♪

carol: welcome back. jason: you can also listen to us on the radio on sirius xm a.m. radio ind on new york, boston, washington, d.c.. carol: and the bay area and london and of course on the bloomberg business app. insights from job recruiters on the best business schools. jason: dmitry talks us through the latest look at the school rankings. >> it is all about the jobs ultimately. even if you are aspiring to start your own business most of the time you will go down a route where you want to get a job first and get some experience and then apply that. whatrecruiters think and they are looking for in candidates is important. this is the same data pool that ,e built the global ranking on

the global ranking in december. this is a decent died by the data seem. several questions about what recruiters are looking for. they are assessing the quality of the candidates. that leads to these mini rankings. >> i candidly looked at this and thought it is going to be the same names. it is not the same names. with picked six questions felt were really important. 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 in the topare not five or 10 of the global rankings. they are in the top 30 because that was the selection they made. >> what i find interesting is

the trends we have been talking , innovation, entrepreneurship, diversity. >> those go hand-in-hand with entrepreneurship. what are the ways in which the schools are enabling these individuals to go beyond the basics and the curriculum we know about to really break out of that and be creative thinkers and apply interesting problem solving solutions to things they come up with. >> before we get too far away from the schools, stanford obviously you mentioned. i was proud even though i did not go to the business school to see georgetown represents a very well in the number of these categories. you mentioned the international names. what were you able to elicit trend was as to who popped up more repeatedly from the recruiters? surprisingit is not

that stanford did come out on top in several categories. in a way that global ranking result -- you see the connection. -- on the innovation front, on the entrepreneurial front. entrepreneurial in terms of what are you teaching and what do you see in students. jason: every week we go a little deeper they guest. we put it up as a podcast we call businessweek extra. this week we are joined by the ceo of fitbit. the company cannot with a few new devices at different price points this week and aiming to keep ahead of a very crowded field of wearables. >> here is part of that conversation with james park. >> we announce new products. we have inspire and inspire hr which are low-cost affordable

trackers. we also announced another lower cost and more affordable version of the versa smart watch. hour successor to a kid's products. >> talk to us about where you see fitbit going. >> a large focus is about growing our community, active users. we grew active users 10% to almost 28 million active users. one of the largest fitness communities in the world. aspstrategy is to lower and increase the number of active users and launch and monetize our user base. >> once you get a user how sticky is it? how do they stay with you? >> health and fitness is a challenging thing for people to stick with. we have been happy with our users.

our active users are increasing every year. >> what is your retention rate? >> we don't break that out but we are happy with it. >> does it improve? >> it has been improving over time as we roll out new features in hardware and software. >> let's talk about software. i am wearing my ionic now. i do use the application fairly frequently to check in. to come for that? how do you get people more addicted to the app? >> a lot of what we deliver to the after this only has been just numbers. what we think will bring a lot of value is something beyond that. what do i do with the data? it will be about coaching, guidance and premium content around nutrition, exercise and mindfulness. getting a holistic solution that

tells people what i should do next and how do i improve. of our chat with james park check out the bloomberg businessweek extra podcast. confined that wherever you download your podcast and on bloomberg.com. takes a special focus on upscale food trends. including how some chefs are building hotels to complement their food. >> you have seen chefs have but it iss and hotels getting increasingly hard to be in the restaurant business, minimum wage is going up. chefs have been clever at figuring out other ways to make money and one of them is to become the hotel e.a. -- hotel year -- hotelier. a couple of them have been in the business for a while. chefs ine more famous the world started this in the mid-90's, he opened one in

france and he is at least one more property. it has not worked out well for ramsey, presumably he yelled at himself. it is cool because you are seeing more chefs decide they want to be the property owner. >> it is smaller properties often. >> smaller properties. a chef named enrique who is always near the top of the 50 best list and has a restaurant in mexico city. he opened up this tiny place. airbnb andp our department of her this restaurant. it is light and airy and they make you breakfast and you can hire one of the chefs to make you dinner. it is a great way to immerse yourself in mexico city. >> you mentioned the margins are much better. >> the margins on restaurants

are generally less than 15%. you have a hotel or you have room it goes up to 30%. if it is in a destination outside the city where you can combine them where you have customers who are going to leave --carol: bloomberg businessweek is available on newsstands now. jason: and online. the private equity industry continues to grow and influence our whole investment environment. jason: credit to joel weber. he assigned that story to me. my favorite story, nick baker in chicago talking about that little spot outside of chicago where so much is happening. a wayne's rolled and ferris bueller reference in there. >> i love that story. you can find more stories on

businessweek.com. >> check out our daily business week podcast. subscribe on itunes.com. carol: more bloomberg television starts now.

♪ francine: legal & general was founded as an insurance company by six london lawyers in the 1830's, but now has businesses and funds around the world. it is one of the largest institutional managers in europe and has more than 980 billion pounds in assets under management. so what does it take to manage a company with this kind of complexity? today on "leaders with lacqua," we meet nigel wilson, chief executive of legal & general. nigel wilson, thank you for speaking to bloomberg. and being here on "leaders." l&g has a diverse business.