♪ riggs in santaylor francisco, and this is "bloomberg technology." disney's streaming service disney plus is hit by technical issues in its debut but some call it technical setbacks -- temporary setbacks. they say they will reach their goal of 9 million users by three years.

in hong kong, how news and rumors are playing a part in protests. and, market share, buyers turn tesla's toyotas for model 3. first, to our top story. the launch of disney's streaming technicalt with some glitches and crashes, but still, buzzy plus generated across social media. rickore, we are joined by springfield and bloomberg's lucas shaw. are the technical glitches perhaps a good sign, showing that demand exceeded expectation? rick: i have no idea. the reality is that technical glitches are sort of commonplace in big launches. you side with hbo and game of

thrones. maybe it was demand driven. who really knows. it is irrelevant in the scheme of this is disney's long-term strategy. bob iger has thrown down the gauntlet. it is not even just about disney plus. fx content. as long as these technical issues are not ongoing, as long as you are not still hearing about technical issues 2, 3 weeks from now, no one will hear about the issues this morning. taylor: did disney cement itself as a clear, formidable competitor to netflix and the like? lucas: i think so, and it has for a long time now. if you ask people in the

entertainment business, silicon valley, wall street, most have viewed disney plus as the most competitive of the new services. max are muchbo further out. disney is the largest entertainment company in the world. from fox.ot of assets the real question moving forward will be how many of these streaming services can the market tolerate? right now, we have hulu, amazon, netflix. most expect that disney plus will be an additive to netflix. but if it slows the growth of new subscribers to netflix at all, that is bad news for the company and investors. taylor: rick, how do you see disney in the context of the broader streaming wars? rick: i think about it differently.

these spend 45, $50 from top streaming services. upwards of $100 or more for comcast, charter spectrum, those bundles are going away. consumers are giving up on those bundles. i think seeing all of this great content from disney plus, apple it iss, netflix, amazon, just making it easier and easier to cut the cord. that frees up a tremendous amount of wallet. for me, this is like adding fuel to a fire that is already burning and will make it so much easier to cut the cord going forward. today is like a real watershed moment. look, the cable bundles in the past, we will put all our best assets onto streaming and whatever happens in the bundle, so be it. it will be a tough place for

espn in their future but i think disney is clearly telling you that they know the bundle is dead or clearly dying, and they have to move forward. taylor: you talk about the cannibalization of traditional subscriptions. dan ives said 10% of netflix's base could be at risk. do you have figures of whether there is cannibalization going on at netflix and the competitors? is one of the most absurd comments i have ever heard. consumers want to stream. you are not choosing between netflix and disney plus. if you are not a sports fan, you will give up on cable service. if you want to watch the crown this week, disney plus does not satisfy that. if you want to watch back episodes of friends, you need hbo max. people have had hbo for years.

hbo has 34 million subscribers today. people are not saying, i have netflix, i don't need hbo anymore. these will coexist the same way hbo and showtime have coexisted. what does the consumer want? if you want stranger things, if you want the crown, if you want the irishman, you have to have netflix. delorean --men mandolorian, you need disney plus. the entertainment bundle, i think people will be looking for where these dollars and subscribers come from. for 2, 34e appetite subscription services. -- 2, 3, 4 subscription services. lucas: it is hard to know how

much people are willing to pay for because it depends how they balance the different things they are spending. the average consumer may not know how much they are spending specifically on cable. they may not treat their amazon subscription as a video subscription, they are really paying for prime. i do think rick is overstating the decline of cable a little bit. he is right that this is a watershed moment, signaling that internet is the future, but even has said thatflix the decline of cable will be slow and steady. even though it is accelerating, you still have many households in the u.s. and worldwide still paying. you will have consumers who have to make a choice. sports fans and older consumers who want to keep watching live television. atlor: you take a look companies like cbs, reporting

lower profit, and urinalysis, do you just assume further profit erosion? rick: streaming is expensive. look at disney stock. september 2020, expectations were $8.33. in may of 2018, for 2020, that is what people were forecasting. aboutk it is down to $5.60. so, this is an acknowledgment, getting into the streaming wars, this is a long-term game. this is really hard. you look at disney, i got up at 6:00 a.m. this morning, i watched the first episode of mandalorian, i enjoyed it but it

was definitely for a diehard star wars fan. i can't watch episode two until friday, i can't watch episode three until the following friday. in terms of new and fresh content to watch, there is not a lot to keep me busy. that is why i think you will have to see disney invest heavily in these services. streaming services require you to create addicts. you have to give people a reason to come back every day for hours at a time. netflix has done a great job of that. now it is on everyone to follow that and create addicts. it is very easy in the streaming world to hit cancel or pause, and come back later. easy to gome really on and off in the digital world. taylor: rick springfield and

lucas shaw, thank you both for joining us. seeks up, music video after tik a new u.s. policy chief. and if you like bloomberg news, check us out on the radio. you can listen on the bloomberg gap, bloomberg.com, and in the u.s., on sirius xm. this is bloomberg. ♪

taylor: microsoft is among the plaintiffs in a case reviewed by the u.s. supreme court tuesday over the so-called daca program.

the software giant is defending its employees who were brought to the u.s. as undocumented children. the deferred action for childhood arrivals program shields nearly 700,000 qualified young immigrants who are in the u.s. illegally, from deportation. it is being challenged by the trump administration. microsoft president brad smith argues that the affected immigrants, were called dreamers, are an essential source of talent that microsoft depends on. other companies like google, apple, and amazon have filed legal documents saying that ending dhaka will hurt the u.s. economy. will hurt the u.s. economy. is being investigated for national consent -- national security concerns but they are -- we are joined by a data privacy

and security lawyer, formerly a legal advisor at the national security council. also with us, ben brody. has been the reaction from the stepped up lobbying efforts in d.c.? captured it of right as it is starting. they are bringing on a new u.s. policy chief, bolstering their --m, and adding alcide adding outside consultants. when they bring those consultants to the hill and say, we are an american company and we don't take directions from beijing. it is worth mentioning that this is kind of blue-chip representation and i think they are putting up at least a good fight as these tensions ramp-up. iflor: the key issue here is

tiktok is a u.s. company or chinese company? cfiust of the new regulations, whether investors have access to nonpublic information about data. there are broader concerns about potentially having access to the information by foreign powers. john: what is the answer to that question? if china wants data, once information, what tiktok be required to turn over that information to beijing? john: that is the concern. there are ways to potentially mitigate that. one of the ways is keeping the data within the united states. china has been very aggressive at wanting to get access and requiring companies in china to

participate. taylor: ben, what is your reaction to that? the key issue in d.c. over data privacy, over turning over data to beijing from u.s. users? sort of the key issue they are looking at. senator josh hawley, last week, he held a hearing where he excoriated facebook. he talked about communist party officials kicking down the door and amending data. he said, parents in the u.s., if you don't know about tiktok, your kids do, and you should. it is a concern animating not just the republican side of the aisle. since my story went up, chuck schumer sent a letter to the army and said there is concern that you are trying to recruit teens on tiktok, trying to recruit young people on this

platform where they are flocking by the millions. he said, i want you to reconsider and not do it because it could be a national security threat. taylor: we have heard from others from tech companies, namely mark zuckerberg at facebook. given your history on the national security council, a worried about you -- how worried are you about chinese tech dominance? issues withare the a lot the concerns at the national security council. technology is the new frontier. whether it is data or information communications technology, i think you are fius, supplynd in c chain, taking a strong look on how to compete with china. about: it is not only turning over data but a lot of this, as mark zuckerberg was pointing out, is about free

speech. what are you hearing about concerns of chinese tech dominance operating basically on concerns where free speech may not be allowed. interestingeally because you hear a lot from legislators here in washington, d.c., about how they want american tech platforms to take certain things down. ,et, our chinese counterparts chinese platforms, the concern is are they taking down too much? have they gone beyond content moderation and community standards into what we would consider censorship. mark zuckerberg sort of hinted that the protesters in hong kong were being censored. it is unclear to me if they are .n tiktok it is important to say here that facebook views tiktok as a major competition for users, viewers,

particularly young people. he is not only stoking a national security concern but also concerned about a competitor, and this was part of the reason for the reshuffle. this morning, there was a lot of concern that tiktok was working with lobbyists who were a little bit too close to facebook. taylor: john, we have seen more us review.fi is that warranted? i certainly think so. data is a bigger part of society and you have companies across the world. trying to balance the security imperatives and economic priorities will be challenging. what you are seeing, whether it or other national security reviews, a hard look at data companies and other information technologies. dermody, and

bloomberg's ben brody, thank you for joining. coming up, instagram picks up the tab for some celebrity videos that comes at a price. what they can and cannot say. this is bloomberg. ♪

facebook is bundling all of its payment tools into a single platform. facebook pay will group existing the appoptions across into one product. this is separate from its calibra app, which will be storing and collecting its digital currency libra. facebook trying to jumpstart its little used instagram tv. to do so, it will fund celebrities as long as they don't say anything about politics or elections.

this comes after backlash for facebook's decision to allow politicians to lie in advertisements on the site. my first thought was, good, because i don't care what they have to say about politics. is that what is going on here? >> it is a really interesting policy for these creators to not be able to talk about clinical youes as facebook makes a -- about political issues as facebook makes a huge deal about not censoring political ads it is not just that they can't talk about elections, they also can't talk about anything facebook considers a political issue. they can't talk about climate change, guns, immigration, even health policy. all these things that are just part of the general discussion that you would expect someone to want to have if they get their production costs paid for by instagram. taylor: why?

sarah: instagram says there is a big difference between letting them talk about these things and paying them to talk about these things. facebook has a new stab where they are paying all sorts of -- has a news tab where they are paying all sorts of groups from talking about politics all the time. the understanding that these are all under the same umbrella. taylor: i wonder if this is , that facebook doesn't appear to be endorsing that person's views? sarah: if they were to pay for content that becomes political in any direction, then people could say instagram paid to have this video made. taylor: another story, facebook bundling all of its payment apps into facebook pay. does this further antagonize regulators who think this is may be a defense mechanism so that

facebook is harder to break up? there is something to be said for facebook pay across all of those services, whether it is whatsapp, instagram, facebook, messenger. this goes back to what i was saying earlier that the company wants to make it very clear that they own all of these properties. what they have found out is that the more people understand that facebook owns whatsapp and instagram, they have more favorable opinions of facebook. regulators are looking that and saying, you are in the middle of an antitrust investigation, you are trying to more closely integrate the products at this point looks like a political move. taylor: another story as well, facebook is the gift that keeps on giving in the news world. facebook has been accused in a lawsuit of censorship.

sarah: facebook has been trying to apply its policies so there is no harm, no attacks on policies that should be protected. however, their policies are not universally applied. there is a lot of selectivity. generally, facebook tends to act when there is public outcry. this guy, his post got taken down, other people's haven't. this lawsuit will bring to light a lot of the editorial decisions. whether that is fairly applied across all of its users. taylor: thank you. people online groups are widening the division in a city already in turmoil. this is bloomberg. ♪

bloomberg'sow join daybreak australia to bring you the latest in tech news. ahn's new york and heidi is new york and heidi's in sydney. let's look at the stories of the day. >> germany's biggest tech ipo in 19 years is on the path redeeming itself after a rough public debut. at its listing price after it fell 10% in the first two days of trading in october. this comes after the first public earnings post at 39% revenue jumped from a year ago.

startupuck delivery app has raised one of the largest initial rounds of capital for startup in the region. it bills itself as an uber for trucks has raised $23 million. the round was led by a half billion dollars saudi tech vc fund that previously invested in meter eastern -- and middle eastern ride-hailing company. tencent is now $90 billion behind rival alibaba in market cap. this comes after a nine-month season gain approvals. a chinese economic slowdown and the possibility it will have to suspend airing nba games in china. last year it paid $1.5 billion for though exclusive streaming rights, but an nba team's executive triggered a media blackout in china and -- after tweeting support for the pro-democracy protests. those of the top google -- the

top bloomberg tech stories. heidi: as hong kong antigovernment protest continue in the 23rd straight week, the city is being flooded with online fake news and misinformation from both sides of the political divide. in the last one he four hours alone, authorities have denied rumors they ordered police to fire on protesters at will and they would use emergency powers to shut down financial markets and many more. joining us to discuss in hong kong, shelley has been on this story. you are already seeing a situation, a cycle where violence is begetting violence and unrest in hong kong day after day. and the fake news online is really a major contributor to that. >> fake news is obviously a problem around the world, but it is really super visceral in hong kong where you will see an event happen and then almost immediately you will see conspiracy theories pop up

online and then that will just fuel the anger and the angst from protesters and pro-china supporters as well who are coming out into the streets. see the direct line from fake news that happens online into the streets of hong kong. taylor: who are the culprits? who are these tech companies that are playing a role in spreading the fake news that have not yet been held accountable? shelly: it is happening on every platform and from most sides of the political divide in hong kong. telegram,eing this on on the local channel here, which is like a red it back in the u.s. and you are also increasingly seeing it on facebook and youtube. a lot of these companies are taking steps to remove some of these fake accounts, but a lot of these accounts are actually real people who are spreading rumors and conspiracy theories.

so it's not necessarily a big disinformation campaign like we've seen out-of-state actors like china or russia, but just videos and pictures that might be taken out of context and then spread around in a different context. of legal framework, is there anything specifically there to address the dissemination of fake news? shelly: we have seen lawmakers and police come out and say please don't believe this rumor, don't believe this rumor, our banks are fine. the roads will be open. but the problem is it goes much aroundwhich is government and police and other authorities here in hong kong. and so it's not necessarily the spread of fake news, but it's the last trust they have in authorities that lights it on fire. taylor: on that same line of thinking, when does that lead to more regulation around fake

news? >> that is one thing we are watching out for here because under emergency powers, if the chief executive were to use them , it could take a greater stand on regulating the internet, shutting down certain apps. there has already been an injunction passed by the high court, a temporary injunction in hong kong that says if you do spread -- intend to commit violence online, you could go to jail for that will be arrested for that. and so those are two things we are watching out for. time when is at a think you said the majority of hong kong are getting their news from the internet. shelly: we took a look at some interest in polling numbers that shows for the first time just this summer that they -- the most trusted new stores is the internet. over television, newspapers, they are also saying -- seeing

an uptick in news from family and friends we haven't seen in a while here in hong kong. u.s., ihere in the think about the 2016 election when we grew a lot of distrust in facebook and there was a lot of backlash after fake news is going on around the 2016 election. as you look to hong kong, wind we see that backlash over there? >> it is really interesting, we spent some time with a group of students at hong kong university who are looking at fake news and the misleading conspiracy theories and one professor who's been studying this says even if you do prove to people that this indeed is not real, that this story or that story is not real. to a lot of people it doesn't matter. if the narrative they want to be and they will share anyway. that's difficult of these tech

company to route these out over governments and authorities to address the issue as well. >> thank you two bloomberg's shelly banjo in hong kong. and coming up, we will have more on tesla's model three. we take a look as it's hitting bmw the hardest. this is bloomberg. ♪ bloomberg. ♪

plans to build a factory near the german capital of berlin according to elon musk at an award ceremony on tuesday. the electric car maker will establish an engineering and design center in berlin near the new airport. germany is home to some of the world's most prestigious automakers and this also comes at the same time tesla is

preparing to sell its cars in shanghai. german automakers are among those affected by tesla's grip on market share. bloomberg gast 5000 tesla owners what it's like to live with elon musk's electric car. the model three is a car for millennials and gen xers, most of the owners were changed -- were aged 30 to 50 with above average income. most 95% were men. the top cars driven, drivers gave up to give a tesla, the toyota prius was number one followed by bmw series three. for more want to bring in craig who covers the company for us. who are the biggest losers as more consumers shift to the model three? craig: the timing couldn't have been more perfect, this is his project, his baby if you will, this model three owner survey. what his survey found was as you alluded to before the break that

bmw is hit hardest by the rise of the model three, while the amount of trade-ins from toyota is bigger, toyota is a much bigger company in this market. they sell quite a few more cars share ofdoes and the sales, the amount of trade-ins that bmw faces is more than mercedes and the top story does go into a great motto detail as to why it harkens back to a ,ouple of magazines reviews these were a performance oriented customers who had zero to 60 and that's something elon musk to his credit has made a big focus of how he hypes his cars. he has talked a lot about performance and made electric cars sexy, which is something other car companies haven't been able to do. taylor: talk to me about the other reasons and owner would switch. it is because the brand is cool

or is it environmental reasons? if you are making the switch, why are you doing so? shelly: it's inter--- craig: there are a lot of things in this latest version of tom's survey that are interesting takeaways. i think the idea that significant portion, i think it was 55%, of people who answer the survey said that elon musk himself factored into the decision on whether or not to buy a tesla and by the model three. that is pretty high and there are some great quotes in the story about the idea that one of the participants in the survey fordo idea who the head of is, the only reason he knew the head of nissan was was carlos was -- has been in jail recently. company, they believe in the mission, a lot of them are mosque fans, that is no musk fans.

95% of respondents were men. if tesla is going to have sustained success, they are obviously going to need to diversify that quite a bit. taylor: craig, on page four we have the vulnerability index showing bmw is at most risk when you look at it as a percent of u.s. sales. walk me through the rationale of why bmw has the most to lose on that index. craig: the survey found there were models like the honda accord or mazda three were kind of surprising that you wouldn't necessarily think would be a natural jump from those cars to the model three. magnitude of the risk to bmw is a surprise but i think this is something you could foresee that bmw and mercedes were going to be brands that would be real competitors that tesla was going after and

you heard some german car executives give elon musk some really sort of doing a serious number on their car business. we heard major auto dealers make similar comments that the german car companies need to do something to sort of answer this gambit that elon musk has thrown down here. taylor: it was so interesting to read the story and look at all the years you've been covering tesla, a company that doesn't do big super bowl ads, they don't do these targeting campaigns. it really is a company that sells by word-of-mouth. in your years of covering tesla, have you ever seen an automaker able to do this? basically cell by word-of-mouth? craig: it's totally unprecedented. for the billions of dollars automaker spend on marketing and you look at third-party the track how much companies spend on advertising, automotive is a

serious spender on marketing dollars, there is a sort of rule of thumb that nothing beats your neighbor talking up his mustang or his corvette. with tesla, they have gone all in on that strategy of if we can get these cars out there, if we can leverage the star power of our ceo, we can save a serious amount of spending that these companies shall out to promote themselves and thus far it's worked. from still a long ways tesla making a serious dent in the u.s. market but they are well on their way and doing it by taking this interesting approach. taylor: thank you for joining us. of europe's is one technology start ups helping europe -- businesses and people move money. now they are stepping into the

u.s. and asian markets. there ceo discussed the company's growth strategy with 's thirdg at singapore annual syntax festival. take a listen. >> we are moving about $5.5 billion on behalf of individuals and businesses. that's the biggest part of what we do is we help businesses and now even banks move money across borders. this is just the beginning and now we are also offering international banking services in about 20 countries, including all of europe. card inhed with a debit the united states about three months ago, two months ago we launched a gnostic -- in australia and new zealand. last month we rolled out our multicurrency debit card in singapore. now we are starting to cover asia with international banking as well and it's seeing a good

take up here. >> are you lending money out at the moment or do you have plans to? >> we don't blend and in terms of regulatory difference, that is the main difference. we don't actually hold banking licenses anywhere in the world because we don't lend. we do hold plenty -- a few months ago we reported it's now more than one billion pounds worth of deposits, but we don't lend them out to other people. we are kind of a non-lending bank if you like. >>pounds worth of as this roof u had to do an initial public offering. does that remain the case and also do you have an exit strategy or do you just want to grow organically in the future? >> this is a very good question and we are indeed the unusual

unicorn that we've been profitable for the last three years and therefore we haven't needed to raise extra capital for the company, however we have raised plenty of money so earlier this year we raised to a to million, which went recycling part of our -- what we can provide liquidity to shareholders and bring on new , so wer -- appropriate are getting the benefits of the public markets but doing that privately today and we have no immediate plans to enlist on a public exchange. was thethat transferwise ceo. still ahead, more on the disney streaming service. how will this compete with the rest? we discussed next. this is bloomberg. ♪ g. ♪

taylor: time for the top tax calls. stocks price cut at mk and partners. the company growth adjusted valuation presents an asymmetric risk reward for the stock. the analyst confirmed the by rating but see continued risk. nvidia's price target was raised from 190, a move that comes ahead of the release of the chipmaker's third-quarter results. the analysts say a reasonable expectation quite some time with potential tailwinds and gpu attached rates.

autodesk a fresh risk after third-quarter results, a positive event for the stock. notable autodesk events can provide capital for the stock that has been down and out this year. a $177 price on the stock. those are a look at the top tax calls. let's get back to the top story all about disney and their anticipated debut disney streaming service which was hit by early technical glitches and crashes for some users. but that did not stop the excitement and buzz on social media and worked successfully for many subscribers. joining is now is andre swanson. andre, your take. is the glitch outage a good thing because it means demand exceeded expectations? andre: normally it's an indicator there are a lot more people trying to access your

solution when you have scaling issues early on. in the big scheme of things i think it's a non-event. it's a very successful day for disney overall. taylor: i ask this question to every analyst to get their take. where does disney fit in your world of all the streaming competitors? andre: i think it's a great question. i think the most people in the industry are looking at it incorrectly, looking at it as if disney plus is a competitor for netflix. i think disney has shown over the last couple of years with getting the majority ownership of hulu and the success of espn plus and now disney plus, they have a winning strategy about how to attack that market. but they are not really competing with netflix. disney has done a better job than anyone at getting share of wallet when it comes to media entertainment dollars weather from theme parks or merchandising or theatrical releases and so now with disney plus, they have even more of a direct consumer relationship

that they can leverage to monetize across all those other revenue streams in a way netflix and others cannot. taylor: this is what i heard from rich over at -- where they are competing not with netflix, but just grabbing cables of script and decline. so would you agree that perhaps they will take on more tables of scripture decline and that there is room for two or three or four streaming services? andre: i like rich a lot, i would argue that the decline in cable is actually irrelevant do disney's strategy as well. i think in terms of disney plus. i think it does impact hulu and the goals of hulu with their life service. but disney's game is far bigger than just even tv. this is just another way for them to engage with consumers and it's not a stand-alone nbcers, whether it's

with peacock or dish. disney has sony more avenues of revenue to engage with the consumer that they don't have to monetize this solution the same way that others do in order to be considered a success. taylor: so are they the clear winner given not only they have money to spend with original programming, but also that big backlog and a library of great videos from decades ago? taylor: i think -- andre: i think it would be hard to argue the disney is not well-positioned. i'm hesitant to say they are the winner because the game hasn't really started yet. maybe the other people competing for audience time and attention are still a quarter or two away from watching. i will say the biggest loser in all of this is absolutely netflix, which i think is more clear and that's because so much of the most popular content that is really driven not only subscriptions, but loyalty on the platform will be leaving and nbcdisney and at&t

universal: content. so i think netflix is not the or six or 12 three months from now that it has been. andre: andhra pradesh taylor: about 30 seconds year, -- taylor: investors will not tolerate losses for long. when do we see a profit from these businesses? andre: if you are looking solely at the streaming part of the revenue, it will be sometime for some of these platforms until they truly are profitable. i think companies that have a legacy library that they can lean on may reach a profit first. but when we look at disney, we can't look at streaming as a standalone because of the impact it will have an the data and how they can leverage that. so i would our -- argue relative to that it is already profitably -- profiting. taylor: thank you for joining us. that does it for this addition of "bloomberg technology" and

bloomberg technology is livestreaming on twitter. check us out, follow our breaking news network at tictoc on twitter. this is bloomberg. ♪ ♪ here, it all starts with a simple...

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♪ haidi: very good morning in sydney. we are under an hour away from the market open in korea. shery ahn: welcome to "daybreak asia." haidi: our top stories this wednesday, president trump puts pressure on china, warning of substantial new tariffs if trade talks failed to produce a favorable deal. hong kong braces for another day of chaos and