♪ emily: i'm emily chang in san francisco and this is "bloomberg technology." coming up in the next hour, musk on the defense. he claims the fcc is filed right by cutting down on his tweets. more governments ground the 737 max after a second deadly crash. our exclusive and wide ranging conversation with tony player on

brexit, big tech, and calls to break up silicon valley's biggest players. elon musk is defending tweets he sent last month. in february, he tweeted it would make 500,000 cars this year. a few hours later, he revised t, deliveries still estimated 400,000. the sec has asked a judge to hold musk in contempt. musk told a judge in new york that he has a right to free speech, though said he has decreased his tweeting to not get into disputes with the fcc. his team filed a 140-page response.

what is their argument? >> this initially looked straightforward, where the settlement for any information that could be considered material and that elon musk had to ask for preapproval to send it from his twitter feed. tesla and musk don't deny the claim he did not get preapproval for the tweet you mentioned earlier. case elon musk and his lawyers are making our the first amendment argument, but also take issue with the idea that tweed was -- tweet was material. they said there was not a reaction in the stock, which i can attest to. certainly, one thing that undercuts elon musk's argument is the idea he sent the second

follow-up tweet. tesla and elon musk say they were doing that out of an abundance of caution and point to that that they are taking a settlement seriously. the fcc is saying, no, you are not. emily: elon musk says he has decreased his tweeting, not because he is concerned about compliance, but wants to avoid unnecessary disputes with the fcc. isn't that another sideways jab? >> it is. it doesn't square with how musk has been acting. that the sec is the short-sellers enrichment commission. he said he does not have respect for the sec. when the fcc sought to hold him in contempt of the settlement, he went on the attack again. when he says he has been

proceeding with caution or being careful about getting into unnecessary disputes, he is getting into a lot of disputes. that is one argument he made that did not seem to make sense. emily: meantime, the fcc has requested permission to respond, but what penalties could elon musk be facing? couldn't he be barred from running tesla or any public company? >> that was the punishment the fcc sought in september, and you saw this rash reaction in the shares. he saw of shares plunge on a friday. by saturday, a settlement was reached. it is well established this would cause a huge negative reaction for tesla. you would think the fcc would keep that in mind in terms of what it is seeking for punishment, and would maybe

guard against seeking that again. one note the criticisms that musk and folks following this case and taking his side are sec isis that the supposed to be looking out for himinvestor, and barring from serving as an executive would be a punishment that would not fit the crime. emily: that is perhaps a less likely option. thank you for keeping us updated on that story. meantime, uber has been ordered to pay $20 million to settle lawsuits or whether its drivers are employees or independent contractors. on whether drivers were forced to resolve conflicts by arbitration and for bid and to join class-action lawsuits. last year, the supreme court

bolstered powers of workers to use arbitration. ournt to bring in reporter. talk about these claims. >> there are many suits uber is settling for a bargain. the central suit was brought in 2013, this is when mover is just in san francisco and there is tension over whether they should be treated as employees or as independent contractors. that is the origin of the central suit. emily: why are they getting away with settling for a bargain? >> it is arbitration. uber has contended and fought won with the help of rulings thatth have upheld its arbitration agreements. so uber has made it difficult to opt out of arbitration.

if you want to work for uber, the general courses they signed the agreement, start working, and they are bound by arbitration. they can't take their cases or conflicts to court, can't band together in arbitration. -- class actions. writeshave upheld uber's to do that, and that is the weapon they have used to blunt these lawsuits. emily: there was a lawsuit about dynamics, a trucking company. those contractors should be treated as employees. >> that's right. driverare a worker, a for uber, hoping to get the benefits of an employee one day, this is your big help, a california supreme court ruling where the court said it applies broadly throughout the economy. it is still early on that

ruling. iss is the one has uber taking the company public, this is the one concern people have not paid enough attention to. emily: how could that ruling affect uber? >> the same weight this case did, only it is much more difficult for uber to get out from underneath the ruling. the ruling would say the relationship you have with your drivers, under that relationship , they are employees and entitled to benefits. that is a different ruling, and for more difficult uber uber to get out from underneath it. emily: uber is not the only company. there are these employees that employ many contractors. >> absolutely. this is the case that was settled that many looked to for the broader gig economy.

now that case is against grubhub against the ninth circuit court of appeals in san francisco. they are looking at this grubhub case and the rules under the dynamics ruling as the future of how the gig economy will sort out and whether these employees are independent contractors or employees. emily: the fight to get status and the benefits is ongoing? >> it is not over. it is not over. it will continue. it will be a more fierce fight. uber is glad to have this one done, go public. emily: for a bargain, as you say. always appreciate you breaking down these complex legal issues for us. i know you will keep us posted on these rulings. restored,emoved, then several ads placed by elizabeth

warren's presidential campaign monday. they promote the plan to break up tech giants like facebook, amazon, and google. the company said it violated his logo abuse policy. think facebook has too much power, let's start about their ability to shut down a debate over whether facebook has too much power .emily: i'm emily -- too much power. facebook restored those posts. ted cruz also retweeted elizabeth warren's tweet, "first time i have read tweeted elizabeth warren, but she is right. facebook has way too much power to silence free speech. a serious threat to our democracy." it is a debate we will continue to have. coming up, regulators halting flights of the boeing 737 max

after a second crash. president trump is weighing in, sing commercial aircraft are "too modern." that is next. this is bloomberg. ♪

the issues of tech regulation and enforcement have become a major platform for politicians. i asked him nuclear -- tony blair if tech needs more regulation. >> it exploits anxiety about the pace of change. they see these big companies, wealthy people who run them, and

they target the companies and the technology as something that will disrupt and change their lives in ways we can't control. my view is this technique logical -- technological revolution is a fact, but it is essentially good thing. we have to deal with this conference. emily: we will have more with tony blair, including his thoughts on brexit. investigators are piecing together why an ethiopian boeing 737 max plunged to ground minutes after takeoff sunday, has regulators are opting for caution. , china, india, australia, and indonesia have grounded the planes, while boeing and the faa are so confident. president trump tweeted the following.

"but sections are needed and the complexity creates dangers, all this with great costs and little gains. i don't know about you, i don't want albert einstein as my pilot, i want professionals that can quickly and easily take control of the plane." our guest joins us now from new york. is there any truth to the assertion about the technological risks to modern flying? >> it seems like he is picking up on the issue being blamed for the first crash of the 737 max back in october. what is being blamed there is this system that is basically a flight control system that boeing put in place to losseract the risks of a of lift. higherved the engines of

to accommodate the fact they are larger but more fuel-efficient, and that cause the plane to dive down. point inort of have a that the system was throwing off the normal operations of the airplane, but the manual overrides were more difficult to execute the necessary. a lot of pilots saying they were properly trained on all the features of this system and it had all the methods in place to do with they needed to do. the counterpoint to that would be imitation is a good thing, research is a good thing. this is a fuel-efficient plane that supposed to be safer, smarter, all these technological advances that allow us to be comfortable flying are a good thing. emily: now you have multiple countries grounding these planes, the u.s. faa, one

analyst from jeffries called it rebellion against the faa, how unprecedented is this? >> you will remember the 787 when they had those battery fires, the faa did ground the planes in that case. to see the faa isolated in its resistance is unique. you have to wonder at what point that reflects on the global worldview of the trump administration. word a rebuff of the faa's to say you may think this is a airworthy, but we will find out for ourselves. it is a stunning statement on the part of the world. emily: what do you think needs makeppen in order to flyers and investors more comfortable with the technology on these planes? is this a huge setback even though we don't know the cause? couldhink the groundings be a positive thing for boeing and general flyer confidence.

if boeing wanted to be proactive and get in front of this, understanding we don't have much information about the ethiopian airlines crash, but why not play it safe and saved we will put these planes on the ground until we figure out what happened because we want everyone to feel confident and comfortable getting aboard these aircraft. 780 seven grounding was thought to be disastrous at the time it happened and there were these doom and gloom predictions that did not come to fruition. it turned out to be a huge generator of profit in cash. it has a stellar safety record. i don't think a grounding is a death sentence. aat would be is if you have tragic accident and the u.s. among the airline still flying these planes. emily: i'm looking at the map of airline still flying these planes in the united states, american, southwest, dozens in the air right now.

we are waiting for investigators to determine the cause. we will see how other countries and governments respond. thank you so much for that update. by 2025, and he is sucked be the world's third-largest economy. venture capital firms are anxious to get in on the growth. what trends are they seeing in india, next. if you like us, check us out on the radio and in the u.s. on sirius xm. this is bloomberg. ♪

as the opportunity opened up, we decided we would start dedicated funds for the region. we saw mobile growth exploding, leading to the growth you just spoke about. 20 million people online in 2000. emily: how do you begin to assess the opportunities? are they just exploding, or is it obvious where you should be putting your money? aswhat is changing his that

you have internet growth exploding, you have repeat entrepreneurs from some of the scaled companies in the market, and more risk capital available. you have the intersection of different things happening. macro tailwinds are strong and leading to opportunity. we are excited by technology making its way into every industry. it could be commerce and retail, hospitality -- one of our companies is doing a great job there. logistics, ridesharing, transportation, media, so a lot of the things in other parts of the world in large digital economies is beginning to happen in india. u.s. commerce and e-commerce companies have taken an interest. amazon has invested billions of dollars. those businesses combined logistics and e-commerce. how has their arrival impacted your job? .> it is a net positive

as early stage investors, we want to build companies that will get public or have some so the idea there is capital or downstream investors are buyers is a good thing. one thing i often say is india is the world's next guest digital economy. it is open. that means capital and interest is coming from all over the world. it could be the u.s., there are active,getting so capital from all parts of the world. that is good, provided it is used in the right way. -- doesn'toesn't their arrival threaten startups? senator warren calls that area around big tech companies the kill zone, where you get bought or you get killed, because they do it themselves. >> it can. if entrepreneurs in india are replicating playbooks from other markets, then you run the risk of the original playbook writer

showing up and running the playbook. it will be tough. the largest and most defensible and label companies will be goes built with an india-first mentality, appreciating the nuance of that market, writing the playbook for that market. we have seen that with some of our companies. when you build companies for that market, usually there are not other folks doing what amazon and uber can do. emily: how is your job different than investing in the u.s.? >> we have to identify great founders early going after the markets. the fundamentals remain the same. what great entrepreneurs need to do remains the same, but the business models will vary in those markets. if you take airbnb and hospitality, thin layer, largely

technology, very scalable, does not get involved heavily in ops. , in india where supply quality is verbal, you you need toariable, fix that supply into some heavy lifting. emily: how do you deal with the government bureaucracy in india from slowing things down? >> that is tough. regulation is always behind business models. that is a part of our job in every market, to be honest. the government that was elected a few years ago is more progressive with respect to business, so we feel positive on that front. emily: ok. lightspeed india partners thank you for joining us. , theresa may's brexit plan failed again in parliament. we will hear what tony blair has to say about the process. i sat down with him earlier today and got his thoughts on

tech regulation. we will also talk about the private space race heating up, and the one company taking on elon musk. this is bloomberg. ♪ 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. emily: this is "bloomberg

technology." i'm emily chang in san francisco. u.k. prime minister theresa may's brexit deal was rejected by parliament on tuesday, putting the country deeper into political crisis. members of parliament expected to vote wednesday to take a no-deal option off the table, but former prime minister tony blair is not optimistic. i spoke to him earlier today about the brexit process. mr. blair: parliament will reject that because there has been a huge majority against no deal. i have said it is unlikely this will happen. frankly, we will be into an application for an extension to the process. emily: i spoke about the role of

tech in government as he wraps up a tour in silicon valley and asked about an op-ed where he said, "populists of both left and right have risen in prominence and further search for scapegoats, tech is firmly in the firing line." take a listen to why this concerns him. mr. blair: politicians exploit people's anxiety about pace of change, the accelerating pace of change. these big companies, wealthy people that run them. they target the companies, the technology as something that is going to disrupt and change our lives in ways we cannot control, and it is basically a bad thing. my view is this technological revolution is a fact, but it is essentially a good thing. but, we have to deal with its consequences. if it is handled in the right way, it can change our lives in good ways and offer enormous opportunities. it is up to politics to address

how we access these opportunities and mitigate the risks because it will displace jobs. emily: you also say politicians who master the tech revolution will decide how the future looks like. how? mr. blair: if i am right in saying this technology revolution is the 21st century equivalent of the 19th century industrial revolution, if i'm right, look back at what the 19th century industrial revolution did. it changed the way people lived, worked. in the end, it changed the laws. it changed politics. it changed everything. the first politicians that come along and understand it, master it, make sense of it and show how this can form a narrative of the future that is essentially optimistic, those are the ones that will succeed. emily: democratic presidential candidate u.s. senator elizabeth warren has proposed breaking up the biggest tech companies -- google, facebook, apple.

i assume you don't agree, but what do you think? mr. blair: i don't agree with her proposals but i think it is a really interesting speech. to be fair to her, it is a speech with an intellectual adherence to it. what it shows is where the democrat platform may well go, and exactly the same issues are going on in the u.k., europe. personally, i think a better way dealing with it is to regulate them. having a regulator for these large tech companies. if you try to break them up, i am not sure that really works. if you try to slice them up, you will find difficulty in doing that. it is important always to understand one of the reasons these companies are so large, they are offering a service people want. yes, there are huge questions that arise, their dominance and their power, but there is a better way to regulate this in a way that has the public interest

put into the mix when we look at these companies in a structured way than think actually if you cut them in three, you will create competition. emily: what does that regulation look like to you, and should the u.s. take the lead of the eu? mr. blair: it is less about being tough, it is about the right ways to do it. it will be sensible given the huge competitive power of china in a.i. particularly, it will be sensible of europe and america to work on this. emily: how so? mr. blair: if you create a more level playing field between europe and america, you would give people the opportunity to develop technologies of the future. it would allow these companies, these big companies, but other companies to grow. it would be sensible to have a transatlantic alliance on regulation of tech for the future. the purpose of it should not to be tough on them.

the purpose should be representing the public interest. there are public interest issues. the sensible thing rather than deciding each of these issues by either breaking them up -- i am not sure that would distort monopoly power. if you broke them up, you might find you created three monopolies, not one. emily: do you believe they are monopolies? mr. blair: they are incredibly powerful. they will likely become even more powerful in time to come. i think a better way of doing it is doing in terms of how do we have the public interest into this? i think these companies -- where i think elizabeth warren is right, they are like utilities. they are utility platforms. the same way when electricity and the water industry and other things were created in the 19th century, they were created first in the private sector. in time, people said these are utilities everyone depends on so

they have to be publicly regulated, in some cases, publicly owned. if they have that amount of power, there will be a demand from the public -- the public interest is taken into account. i think a better way of doing that is having regulators to work with those companies rather than break them up. emily: facebook, for example, multiple scandals. compromised the data of millions of people. many apologies. mark zuckerberg has now said we will focus on privacy, on private communication. is that enough? mr. blair: i understand why he wants to do that, and privacy is obviously in issue. the central question is power. it is their power. they are powerful. if you look at their dominant position in advertising -- the role facebook will inevitably play in politics today.

what i think is -- you have to be responsible for everything that is happening. the truth is it is a joint responsibility. we have a public interest in making sure that they exercise their position responsibility, but we are also going to have to work with them to share that responsibility for the public policy point of view, because many of these questions whether it is hate speech or radicalization or child pornography, whatever it is, these are things that is obviously a public interest in sorting out. but, that public interest will require not just a company to behave responsibly, but a government to be alongside the process of that, making sure it is done in an effective way. emily: how can we trust the companies to understand and live will up to the responsibilities? similarly, how can we trust government to not be mired in this political process as we see in the u.k. and u.s. and actually do something? mr. blair: the challenge is best addressed by a concept of public

interest regulation, and whether you do that for each individual company, you might. different issues arise. facebook, amazon and google, quite different questions arise. the bigger question is then what happens -- for example, if you take driverless cars, the next generation of cars are likely to be electric and in time driverless. this is going to change employment. it's going to change transport. it is probably going to change insurance. a massive series of implications. my point is this technology revolution is basically benign, because people will move to driverless cars, you reduce accidents and cost of travel, but it brings huge consequences. the role of government is to make sure the technologies and the risks and consequences that will be damaging, they will be accounted.

emily: cybersecurity experts are saying russian internet trolls are evolving. they are not creating their own propaganda to a interfere in the u.s. 2020 elections. they are creating fake accounts that promote propaganda to mask their identities. does that concern you? mr. blair: of course. we've got to get a real handle on it and expose it and sort it out. at this point in time, and the question for western policymakers, which is what is your sanction? at a certain point, are you going to retaliate? is it possible to get some form of agreement where countries come together and agree these things cannot happen? i think it is a difficult question. i'm not sure what the answer of the moment is, but for sure, it will become a major question because you will get -- by the way, what russia is doing could be followed by other countries. it's a completely new form of

warfare and a serious one. emily: how concerned are you about the rise of china in technology? mr. blair: very, but on the other hand, if i was chinese, i would say why shouldn't we be great in technology? we are going to be one of the most powerful countries in the world. our economy is going to be one of the largest, if not the largest. we are going to be a big political power. i would say, ok, i understand that, but i think the competition coming out of china -- it is a different political system -- it is all the more important that we as policymakers respond to this tech revolution in the right way. emily: is the rise of the chinese tech industry, in your view, an existential threat to western, liberal democracies? mr. blair: that is a very big statement to make. i think it poses challenges for us, for the moment. certainly, part of the policy debate that we've got to have is

how do we manage to maintain the technological edge? emily: you are meeting with companies. who are you interested in working with and what do you want to accomplish? mr. blair: i worked with companies large and small. what we are doing is creating within my institute a center to put changemakers and policymakers together in circumstances where we can bring a mutual understanding, and out of that should come what i call sensible policy. emily: my exclusive interview with former u.k. prime minister tony blair. coming up, spacex's satellite rival. how oneweb plans to win the race to create a space internet and beat out elon musk. this is bloomberg. ♪ emily: satellite maker oneweb

recently took the four steps towards its goal to building a space internet. using thousands of satellites to provide wi-fi access to everyone on the planet. ashlee vance reports on oneweb in the latest edition of "bloomberg businessweek." he joins us now. report on oneweb's very first launch of the heart of the amazon, how did that go? ashee: it was pretty interesting. i was in french guiana, the tip of south america. i have been covering oneweb for several years, waiting for them to get to this point. finally, they have launched the first six of what is meant to be 1,980 satellites. emily: what exactly does oneweb

hope to accomplish? how are they taking on elon musk? ashlee: both companies, spacex and oneweb, are in this game to what you can call a space internet. basically today, there are about 3 billion people that cannot be reached by fiber-optic cables so they want the same internet that the rest of us enjoy. these companies are racing to provide this. oneweb started out very much preaching this do-gooder type mission, of bringing the internet to people who don't have it. they tend to be in pretty poor and remote locations. oneweb has found out the service is very expensive to build, so some of the first customers they are talking about going after now is actually delivering high-speed internet to planes, cars, boats, and people that can afford to pay for this service when they are in a remote location. spacex and oneweb are racing after the same thing, and a couple of other companies are doing this. emily: who is going to get there first?

ashlee: spacex set up a couple of satellites last year. test satellites for its system. it is unclear right now how well those are working or where spacex is as far as mass-producing its satellites. in some sense, oneweb has the lead, they have six satellites that seem to be working. you also have to have these cheap antennas to receive the signals back on earth. you have to have spectrum available to run this service globally. it looks like oneweb is ahead just about everyone when you take all of these pieces together. spacex and elon keep talking a big game and say they are coming this year as well with hundreds of satellites. emily: there are some personal tension between the founder of oneweb and musk. tell us about that. ashlee: the founder of oneweb is this guy named greg weiler, a pretty interesting character i have profiled over the years.

at one point, he was basically working inside of google. when he first started thinking about this space internet idea, it looked like he might build it in conjunction with google. at some point, he became friends with elon and they were talking about the space internet. it looked like all three of these groups might get together. as time went on, greg basically woke up one day and found out that spacex was determined to build its own space internet. oneweb had to run out and get people like richard branson's virgin group and softbank and qualcomm to fund its project. especially for greg weiler, this is on a personal level. this is some serious competition and he would like to get there before elon. emily: the amount of stuff being sent into space is rapidly increasing. you write that current satellite

orders would increase the amount orbiting earth five times over the next few years. what is all this other stuff doing? ashlee: i think we are at this interesting point with space and rockets and satellites that most people are not aware of, which is that the price of rockets have come down dramatically. there is a ton of small rocket companies that are starting to launch like rocket lab. the price of satellites have come way down from $1 billion to $100,000 for the small, shoebox size satellites. currently orbiting the earth, there are about 1500 satellites. if you look at the launch manifests of satellite companies like oneweb and spacex, that 1500 number over the next five years could go as high as, some people have it at 20,000, 30,000, 40,000 satellites surrounding the earth.

i sort of think of it as them building a type of computing shell that will surround the earth. it will be doing stuff like communication with the space internet. it will be taking pictures of the earth everyday. already, a company takes a picture of every spot on earth every single day. all kinds of new science will be taking place. yeah, i don't think most people are aware the skies are about to be filled with many, many times more satellites than we have ever seen before. emily: since you wrote the bio on elon musk, i have to ask you about the latest kerfuffle with the sec. sec asking musk to be held in contempt. him responding saying he has a constitutional right to free speech. meantime, this abrupt about-face on store closings. he announced he was going to close the stores, and a week later, half the stores would remain open. what is your take on musk in 2019? big question.

ashlee: it is an interesting time, for sure. i enjoyed the free-speech argument. you know, there is a part of elon that is so perplexing. that is kind of why he is on twitter doing all this stuff. it seems to create more problems for everyone. i think historically, he used twitter really well as a marketing tool. tesla does not buy any ads and elon had all the goodwill of people on twitter. it's shifted to where you still have some of that. then, you have elon going off into some pretty weird places and appearing to be -- he's perplexing to a lot of people, but this stuff, fighting the sec, that is classic elon. he is going to stick by what he thinks is the right thing to do.

but, i just have to say at some point, this is causing more harm then good overall for him. emily: yeah, you've got to wonder. we are covering every twist and turn. ashlee vance, thanks so much for joining us. check his latest story in "bloomberg businessweek" on newstands and online now. you can also hear from the magazine's top reporters and editors every weekend on bloomberg television, radio and bloomberg.com. still ahead, a sweeping criminal conspiracy of wealthy parents making bribes for college admissions is rocking many industries, from finance to entertainment and even tech. details ahead. this is bloomberg. ♪ emily: foxconn billionaire

terry gou responded in outrage to a microsoft lawsuit tuesday. microsoft claiming foxconn owes

royalties to devices. gou responding, saying it is a personal attack towards him and his company. >> i will say this now to microsoft -- you are afraid. if you have the guts, go and sue them. why push on the taiwanese contract manufacturer making such thin margins? why go after us? their goal is to go after public attention. why now? because the u.s. and china are about to sign a trade deal. emily: microsoft is claiming it is trying to merely enforce contractual commitments from its 2013 agreement with foxconn. parents, universities, coaches and college admission counselors among dozens charged in a sweeping criminal conspiracy that helps applicants win admission to elite universities. among those charged, william mcglashan, the head of tpg business. he has been a guest multiple times on this show. he allegedly agreed to pay

$50,000 to a charity with the understanding that his son's answers on the act exam would be corrected. robert zangrillo, the founder of dragon global management which has invested in facebook and uber, was also accused of conspiring to bribe university officials to help his daughter gain admission to the university of southern california. finally, it was 30 years ago that tim berners-lee, a british computer scientist, turned in his proposal for what would become the world wide web. it came into the public consciousness with simple graphical webpages, chat rooms and aol disks. with the world wide web, the world was transformed. smartphone technology, social media, instant gratification, but with all that came problems news, addiction, fake

causing its creator to say this. tim: whoops. the web is not the web we wanted in every respect. emily: but, he also has plans to fix it all. tim: the foundation is collaboratively building a contract for the web. bringing governments, companies and citizens together to commit to building a better web. we need your help to make this work. emily: let's hope this fix-it-all plan does not take another 30 years. that does it for this edition of "bloomberg technology." on wednesday, we will sit down with roger mcnamee, elevation partners founder and author of "zucked." we are live streaming on twitter @technology. follow our global breaking news network, tictoc, on twitter. this is bloomberg. ♪

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