♪ >> i am taylor rags in for emily chang. this is the best -- i am taylor riggs in for emily chang. this is the best of bloomberg tech. theng up, expedia joins ranks of those losing a ceo. larry pages googles and sergei brennan. brin.gey

widening itsftc is investigation of amazon. we will have details. national security risk -- blackburn on the social media app tictoc. -- china'sled it to best detective. we will talk to her after tictoc says it has made changes. we begin with major changes happening at alphabet. larry page and sergei brennan brinnced -- sergey announced they are stepping down. remain active and remain on the board. on tuesday -- >> it was a pretty big surprise actually. there had been some questions about how much longer send our dar would want to be ceo

of google. google is under a massive amount of scrutiny. there have been internal protests within the company. this really was a surprise. he has basically had to deal with all of these things and now he will be back dealing with all of those things that happen under the apple umbrella, -- sergey ared visionaries and sundar is an executioner. where they fit in? se together founded the search engine more than -- larry and sergey

together founded the search engine more than 15 years ago. he pushed them into things like self driving cars. -- his background came from a more core google background where he ran the chrome web browser, chrome operating system. he worked his way up to the company. he can be seen as more of a operations guy and certainly 2015, sunappened in dar has been the one to deal with more of the day-to-day things at google. jean, what is your initial ne, what is your natural reaction to this -- initial reaction to this? companyconcept that the

is moving into a different chapter -- the google proper is the next chapter. it will be a lot around policy and data privacy and regulation. if you think about the founders and what they have accomplished, and what the next couple of years would look like, testifying for example and going --ough some of the new i'm not surprised ultimately to see this. there is another part of me that is just kind of sad because they had such a profound impact on our lives. just a reminder that even the greats move on. taylor: how much of this can be seen as a vote of confidence in hai?ar p china -- pic >> it is more related to what

sergey and larry want to do than it is a vote of confidence, but it is a vote of confidence nevertheless. if they do not have that, he would not be the one tapped for the role. when tim cookke works the politics. in this day and age, you are not just running a company. you have to work the politics. ai able to doh that? >> he is from a technology standpoint. if someone asks him a complicated question, you will know all of that stuff. technically, he is great. on the showing up for congressional hearing, that is not something that he really, really loves to do. a quiet and

thoughtful person and i don't think he likes being asked things live when the whole country is watching in a contentious situation. he can certainly do it and when you compare it to larry page who really does not want to do any of that stuff, that is really the comparison to be made. earlier this year, larry page said -- where is larry? this decision today partly addresses that. taylor: as you take a look at the company now he is running both google and alphabet, what could be some of the challenges now of running both of those while the other two are just on the board by controlling most of the shares? >> the obvious challenge it the one we have covered here around havey -- is the one we

covered here around policy. the other is how much oxygen to give. when we think about what has changed in late stage investing over the last six months with we ft the path to prop -- path to profitability that would be to me the critical -- i would love to see --he room and specifically, the easy one to --k about is it is basically launching an entirely wrapped up, tidy product. --la's evolutionary that to me would be kind of one of the key issues and more broadly how they want to continue to hedge their other

timein the other 20% of that is been the foundation of working at google. taylor: do you think this can be seen as a good thing? bringing this under one person, bringing both companies together, having him run both divisions, simplifying under a big umbrella? google is definitely the powerhouse of the portfolio of companies, so that makes a ton of sense. i would not be surprised if in the year or two, sundar stays at the top and leadership is brought in for google. taylor: that was bloomberg technology's alistair barr and gene munster of loup ventures. the sheer number of founders and ceos that have now to -- now stepped down in the tech sector,

i got insight from challenger. he was joined by bloomberg technology's tom giles. >> we are going through one by one the biggest companies are making that transformation. it has been happening for a long time -- steve jobs passed away a decade ago. it has been one big company after another. we have a couple left. the major one facebook and jeff bezos with amazon. what is happening is as these companies mature, they no longer have the same need for visionary founders, the engineer who came up with these whizbang products. you need someone who is a solid manager, someone who can manage atupply chain like tom cook apple. someone who has management shops, the sensibilities to run a company. as we talked about larry and ser their not known for

management skills. >> what do you make of this transition from the first generation to the second generation of these leaders? >> we have seen a lot of changes in the ceo position in the tech sector. through this year, we have tracked 180 departures. that is the most we have recorded since we started tracking this number in 2000 two. a lot of those departures are these founders, ceos, they created a company out of nothing, but the company has grown into a more mature phase. juul labs, under armour, a lot of it has been caused by this ten-year expanding cycle in the economy where companies have been able to grow to a new maturity and hopefully, we are seeing -- and i think we are at google -- a solid handoff to the next generation of business leaders

as opposed to a really -- really a shakeup. taylor: we have talked a lot about diversity as well. numbere a lot of good two females, but not yet a number one female. when do you think we might see that? tom: i think it is indicative of a larger malaise. to their credit, these companies have been more transparent about the numbers, the problem is what those numbers show is the -- a real lack of progress over the last seven years. the goal was one of the first talking about here is how many women we have in senior management. all the big companies are doing it now -- great. what is terrible is that they are showing so little progress. these are big companies. it is hard to move the ship. it is really time for these companies to really bring more women and people of color into their board, into their senior management. it is well overdue. taylor: that was andrew

challenger and bloomberg tom giles. it was not just google announcing departures this week -- expedia ceo and expedia cfo announced their resignations this week, effective immediately. the pair clashed with the board on the travel company's direction. iac chairman and peter kern will take over while directors look for long-term leadership. coming up, officials brought in their scrutiny of amazon to include its massive cloud computing business. we will have details. if you like bloomberg news, check us out on the radio. you can listen on the bloomberg app, bloomberg.com, and in the s fm. on serious -- siriu this is bloomberg. ♪

aylor: amazon is dealing with widening antitrust probe.

federal officials are looking beyond its retail operations to include its massive cloud computing business. issue andd the potential consequences with naomi.akes and -- with surprise. this is a complaints about amazon's retail business are well-known. independent sellers for years now have been talking about ways they think the company is not treating them fairly. have been aervices lot quieter. the fact that the ftc sees this as an area of concern is it significant, especially since amazon web services is such a strong part of amazon's overall business. taylor: you take a look at the business -- respond to what naomi was saying. the retail concerns have been highlighted here. what about that cloud computing business? did it feel anti-competitive?

>> it is a multi trillion dollar business. i was at the conference which is still going on and the ceo of cloudlled out that penetration is still 3%. premise is still 97%. almost 50% market share that he called out is something that gardner has publicly released. that is of the ais -- infrastructure as a service market. if we look at the overall tech market, it is still a several trillion dollar opportunity that aws is a small portion of. we had the attorney -- assistant attorney general at the attack -- at the department of justice for antitrust. he said that being big is not bad, but big acting badly is bad. i will talk about it a little

bit more, but that was a fascinating statement. it makes sense why they were looking at practices at awi. hear, itrom what i can seems like a competitive business. you have amazon's cloud business . we hear it is a competitive business. does that may be raise the bar for this hurdle to cross? shweta: absolutely. it is becoming increasingly competitive. we talked about the third-quarter results where aws decelerated. is biz -- the primary result that aws is seeing increasing pressure from as your who grew azure,ster clip -- from which grew at a faster clip. dueor: naomi, let me full back in here. in your reporting, you talk about -- let me fold you back in

their. know for sure do is that they will be looking at whether there are specific market practices that amazon is doing that could be deemed to anti-competitive. is amazon unfairly excluding some of its rivals? is amazon treating -- they may look at whether amazon is treating independent software service providers differently if they also use cloud providers. those market practices are what the ftc will likely be looking into. we will see if they find anything worthy of a case. taylor: any sense on how amazon has been responding to this? naomi: amazon has not publicly commented, but we do see them talking more publicly about their cloud business. they have shown no signs that

they are worried about this at all. it seems to be, at least publicly, business as usual for amazon. taylor: does any of this have a real impact on the fundamentals of the business? how are the headlines impacting the share price? shweta: i think that the antitrust risk at this point is priced into amazon shares. they have a fault back a year today. when we compare them to the overall market, or the retail performance, amazon has not done as well, and it is because of this overhang. one of the risks that amazon faces is the overhang from antitrust. overall of the operations of the company, i do to think that it is material the overall business. retail is very strong. aws is very strong. nix and that was naomi

shweta. google is now facing an inquiry in the u.k.. the competition and markets authority on thursday issued an enforcement order barring google from integrating their services while officials study the acquisition. google once looker for its cloud units. looker -- google wants for its cloud units. the future is 5g. we will learn how coming up next. later, one of tictoc's harshest istics, marsha blackburn, addressing her biggest concerns. this is bloomberg. ♪

taylor: 5g is a fundamental technology change that will

change the way people do business. that is according to steve mollenkopf. he sat down with caroline hyde importance ofthe 5g. way --e it in the same you should think about it like electricity or water -- these fundamental technology changes that change the way people do business. that is how people in the industry are thinking about 5g. clearly it is going to impact the cellular industry. you will see a lot of benefits to operators. when you have the ability to connect everything in the world, it is going to change the way people do business. it will change the way factories are structured. it will change the way we deliver health care. it will change the way we do logistics. this digitization of business and the infrastructure of the world will be very significant. it is one of the reasons why you

see so much international desire be first in 5g. everyone knows the fundamental technologies are so important to the rest of the economy -- make sure you are not behind. caroline: at the moment, what is the economic impact? do you have any idea of what this will be like from a u.s. inspected? from a global perspective? u.s. perspective? we did a study three or four years ago and it was 12.3 -- caroline: it is already scaling. steve: the things people thought would happen is already happening. we look at the broad customer base, a lot of people hey, to us and talk about "

i know i have to be doing something in 5g, help us figure out what it is." steve: what are some of -- caroline: what are some of the more surprising industries that have walked through your door? -- factories.ial what you want to see in factories is i want to be able to reconfigure it very quickly and the data that comes off of my machines like a robot to that is making a car for example, tremendous amount of data comes off of there. it is the fundamental ip of the car company -- how do i make the car? quickly theyge how can react to the market in terms of having different model, year -- they can reconfigure very quickly. the other one is logistics. if you think about a city like new york, moving things around -- we really have not done

dramatic changes in the technology of moving things around other than to create more streets. when you can connect everything and you figure out how to optimize it, and you can do all the big ai and data on moving goods and services, people and things around in a city. as cities grow larger, it is a tremendous advantage to a city. there is a tremendous desire for people to get connected. is a: do feel that this responsibility that you are a driving force behind this technology? -- do you feel risk -- caroline: do feel responsibility that you are a driving force behind this technology? steve: it is about creating a bigger pie. you're trying to make the market grow. particularly in areas where a market is developing that it didn't develop before.

we do a great job at developing -- creating value for our shareholders. what are the fundamental technologies that we need to create? how do we scale them, meaning share them, with everyone? we are not good at doing this -- what is the end product? what is the hardest technology and what can we deliver the biggest pieced -- peace so that people can innovate on top of it? e so that people can innovate on top of it? what do we need to do so that 10 years from now a company can develop these technologies? if we can do that, we can deliver for our shareholders and for this goal to grow the pie. taylor: that was steve mollenkopf. still ahead, tictoc has taken steps to reduce scrutiny from u.s. lawmakers. we will hear from one of the

critics, tennessee senator marsha blackburn. we are livestreaming on twitter -- check us out at technology and make sure to follow us at quick take on twitter. this is bloomberg. ♪

taylor: welcome back to the best of bloomberg technology. i am taylor riggs. u.s. lawmakers have been after tictoc for a variety of reasons -- the chinese company has been a target of national security and data privacy concerns as well as a review. one of the things they are concerned about is that tictoc allows children starting at the age of 13 to make inapt purchases. -- to make in app purchases. senatorsomething blackburn said is paving the way for the chinese government to

gain unsupervised access to our children's lives. on tuesday, tictoc responded by updating -- upping that minimum age to 18. senate -- we spoke to senator blackburn several days later to see if that was enough? sen. blackburn: i am pleased that they have changed the age. that is an important first step. having these children streaming these videos, buying these emojis that can be converted to cash by the recipients, this is just inappropriate. we wanted to protect children online. we want to make certain that apps are age-appropriate. -- you mentioned the other concerns that are there, we want -- we will continue to work with them. when you look at the facial recognition, the profiling that is done, the concerns on national security -- the beijing, you cannot

tell where their commercial sector and their military sector begin and end. they are all one and the same. china is determined to build a surveillance state that is not only on their people and certainly we have seen this used on the hong kong protesters and uighurs.the when you think about the profiles they are building of these children and how they would use that 10 or 15 years down the road, it is of can -- tremendous concern to west. taylor: now that tictoc has raised that minimum age, is that enough for you to recommend it? or do you have more concerns about the beijing government using it? sen. blackburn: we have other concerns. we will continue to meet with them and work with them. i look forward to sitting down with their leadership team in

the coming days. taylor: do you agree that tictoc should be under cfius review? sen. blackburn: it is appropriate to sit down with them to have this conversation and decide if these companies -- if this is something that should be under cfius review. it is the right question to be asking. taylor: having discussions with leadership is a great way to start -- how do you take it to the next level and prevent data in the u.s. and tictoc to be sent overseas to the beijing government? sen. blackburn: one of the things we discussed today in commerce committee was having privacy legislation and data security legislation here in the u.s.. we have gdpr, which went too far in the eu.there you have california looking at doing their own legislation.

it is time for the u.s. to put a basic federal privacy standard on the books. this is something that online consumers want. they want the ability, taylor, to protect their virtual you. they want to the ability to secure their identity online. we had a tremendous hearing -- great bipartisan participation. of expert panel witnesses, they were all female. this is one of the reasons -- one of the reasons for that is women are so concerned about the privacy issue. taylor: i did listen to that. i did see that. i wanted to address that. as we move on to talking here about big tackett, one of the tweets that you had earlier this googles about specifically censoring conservative voices. what are your facts to support that? sen. blackburn: when you look at

the research work that has been done, and we have done a good bit of this work in our office. other groups have done this. when you look at the groups who are censored, the posts that are , you see that those that are right of center are censored much more heavily than those from the left. there are plenty of numbers that you can look at for this. indeed, one of the significant things as we worked on this saying thatd a ceo their employees are in california and they bring their personal opinions into the workplace. it is their worldview. this is something that needs to be a neutral platform, if indeed your social media and your online connections are going to be the new public square.

taylor: i would love your thoughts on political ad policy. you have facebook on one side, google somewhere in the middle, twitter not allowing any local ads on their platform -- what do you think is the right choice? sen. blackburn: i think political speech is free speech. one of the things i have said so regularly is that i may not agree with someone's opinion on something, but i am going to defend their right to put that add up there. becourse, we all want ads to truthful and factual. thattimes you will see ads have documented and sourced what they have. i think also we need to keep in mind at our system of government , a democratic republic, has been well served by having robust, vigorous, respectful

debate from a two-party angle. that serves our nation in the cause of freedom well. make these discussions -- have these discussions about what is going to transpire in the virtual space in relation to political speech, in relation to religious speech, what we want to do is make sure that it is fair and that we are protecting individuals'rights to free speech. senatorthat was a marsha blackburn of tennessee. french president emmanuel macron once it had tech friendly credentials -- now he is calling for greater control over big attack. we will have more on france's stance on that digital tax up next. several states are trying to block t-mobile's takeover of sprint on antitrust grounds. we will lay out the case from t-mobile's perspective.

this is bloomberg. ♪

taylor: the u.k. prime minister boris johnson enjoying -- joining the chorus of leaders wanting to tax big tech. johnson said when it comes to taxing internet giants on their revenues in this country, i do think we should be taxing them properly. i will be bringing forward measures to do that. earlier this week, the u.s. warned italy not to go forward with the planned attacks on amazon and google. french president emmanuel macron has already imposed a tax on --bal tax -- global tat global tech companies.

companies make those contribute to the coffers like their brick and mortar peers. >> basically they are looking at a tax saying the consumers and france are not paying for the services. there are no tax revenues. the consumers are there and france should get a piece of that pie. france was the first want to take that step. are seeing a lot of other countries, u.k., new zealand, past these laws. this is concerning the u.s., particularly because they see that as their tax revenue. they say if anyone gets to tax google and amazon, it is us. it is interesting how this started as a conversation about leveling the playing field. has it transferred -- transitioned to a data privacy concern?

have the u.s. saying you guys do not get this money and all the other countries are saying but you guys are operating here, you have employees here, our citizens are using the service. at the large,een multilateral level, is you have countries sitting down, seeing if they can come up with the system to see which country gets to tax what companies portion of their revenue. it is a massively complicated thing to do. on one side or the other, you have the u.s. and you have france. so, laura, how does the u.s. respond to protect our entrepreneurial spirit within the tech sector? laura: that is something we are waiting to hear about today. the u.s. trade representative looking at this. several months ago, they opened up this investigation to see if there should be some trade

reaction. they're looking at tariffs, some way to perish -- punish france. if you're going to do this to our signature tackett companies, we will do something to your products. president trump has spoken about tariffs on french wine in the past for example. nothing will be immediate. will -- there -- will be a 90 day. . period. taylor: it is notable they are not talking about breaking up big tech. how would you do that in the eu, given they are american companies. laura: how do you draw a line on what is big tech are what is a smaller company that maybe approaching that threshold. you're looking at big pharma, you're looking at manufacturing,

it is a big gorilla. at the end of this day, it means that some countries like the u.s. could end up losing out on tax revenue, where countries like you at -- india and china could win. --lor: we tried to capture france was among the european perspectives we tried to capture this week. i spoke down with the french minister of technology this week. global concern both within the u.s. but also within europe on how do we set up a new regulatory framework. there is taxation, privacy, antitrust. those startups and even the biggest companies need to acknowledge the fact that we need a new playing field. -- what is they set up of that new level playing field? that is why we are favoring an

informational solution. we have been introducing a national tax, but the main issue we are fighting for is to find a solution at the universal level. there been lots of discussion with the europeans. taylor: do you view your tax as a steppingstone to a broader, multilateral ocd? oed? cedric: we have to find an international -- in the meantime, france would be introducing its own tax. the amount of money the company would be paying, we would refund them if the international taxes lowered. the issue is finding an international solution. taylor: you want an international solution. you have gone the route of a unilateral deal. the oecd appears to want a more multilateral deal. those are in conflict with each

other. as that hurt your talks progress with the u.s., with the oecd? cedric: so far it has not. between trumpal and micron -- emmanuel macron. we would favor a international decision, but does -- was an announcement from the u.s.. i think that the main issue is that we can find a common solution at the oecd level. that is what is at stake. france has been making many steps forward toward the solution. now the question is raised to the u.s., do you agree to the solution of the table. taylor: what do you want that broad framework to look like? cedric: there are two pillars --

the first one is minimal taxation. taxation. are the mom the second pillar is that we need to rethink the way that we assess the value of the company, not based on physical, but on digital footprint in some countries. we have to reassess the way that we assess the footprint of the company. companies, -- and the international world, you do not rely on physical presence in a country. taylor: how does a digital cap -- digital tax help us with data privacy? cedric: they're totally different issues. concern inbroader our economy and society.

is something also. --ation, regulation of we have to rethink the whole framework to adapt to the new world. president hasench said either a unilateral deal will go through or he will look for a multilateral deal with the oecd. which do you think is more likely to go forward at this point? cedric: i think the ball is on the u.s. aside so far. as soon as the u.s. agrees to the oecd solution, everything to be at the table. the first thing is does the u.s. agreed to go for the oecd solution or shall we find something that is more european or more international? taylor: if the u.s. does not go ahead with some of the oecd's proposals and they instead

retaliated with about $2.4 billion in taxes back on french products, are you prepared? are those countries purported for these retaliatory tariffs? a good that would be solution either for the u.s. nor france. europe has always said that it would be favoring an oecd solution, but if the oecd solution would not be issued, then europe will take the initiative at its own level. this is what is at stake. if there is retaliation from the u.s., everything is on the table. europe has said that it would be backing up france. we hope there are still some room for discussion and that we can find a solution. taylor: you say europe has been backing up france, but frankly you are the only ones who have gone through with this unilateral tax as of yet. cedric: i said there are other european countries that would be interested. u.k. being one of them.

spain has been one of them. italy and austria as well. it is not only a french thing. the european commission has been tax.g it once a a tax and is favoring the oecd solution. it would go for a european solution. we need to create that level playing field. if the americans do not want to go for that solution, we will go for a european solution. taylor: and you really feel europe is behind you? cedric: oh yeah. if at the end of the day, we have to go in that discussion, europe would be backing france. to the i want to go back

retaliatory tariffs we were talking about. it could not be -- it could be not as broad as 2.4 million dollars -- $2.4 billion. was french minister of digital affairs cedric co. -- cedric o. next -- this is bloomberg. ♪

taylor: three states have agreed to drop their challenges to the merger of t-mobile and sprint.

t-mobile brokered settlements with texas, utah, and colorado, in a multi-state suit. this is -- it is scheduled to go to a manhattan court. is actually now four states -- we had another one very recently. this is seppi is in that group to -- mississippi is in that group too. it is not surprising that these companies -- it is not surprising that certain states have settled with these companies. some have -- it may have been just concerned with negotiating to ensure that some of those promises about 5g build out were actually going to go to their state and go to the populations of their state. if you look at the far settlements, they are very similar. they all involve promises to bring out -- build out 5g to

populations of the state within six years. some of them include payments to the state. some include guaranteed employment levels. do we have any sense if this thing will really go to trial december 9 or do we think we could see a broad-based settlement before then? jennifer: i think we could see more settlements, but i'm certain it will go to trial. it starts monday. i do not think new york and california are interested in settling the suit. something will have to give to build that -- rake that logjam. the parties are gearing up. the states that are still in, which is 13 states plus the district of columbia, look pretty doug instill. still.: i went -- dug in taylor: i want to show you a graph here. worried.are a little a lot of analysts are hoping for

a deal because they think states have a really good argument as they head into trial. how much pressure is this putting on sprint and t-mobile to put a deal -- make a deal? jennifer: it is a lot of pressure on them. it has been an extended interim. --ce they announced to the it has been an extended interim period since they announced the merger to now. whatever -- however they were hurt during this interim. , they will not get recompensed for it after the trial -- however they were hurt during get interim, they will not recompensed for it after the trial. taylor: any sense of what the competitors feelings are? they say they are the first to have 5g and they will be a real threat if the merger between t-mobile and sprint goes

through. have we heard anything from the competitors about this? jennifer: i think the competitors have been quiet about it for a reason. when a competitor complains about a deal, it can actually have a strange effect on the way the doj might look at the deal. a competitor complaining might suggested that the deal is actually competitive, that it will force that competitor to lower their prices and compete more strongly. rison and at&t have been quiet about it and i think they are -- verizon and at&t have been quiet about it. it is difficult to predict what will happen and whether this deal will get closed in 2020. for thishat does it edition of the best of bloomberg technology. we will bring you all the latest in tech throughout the week. 5:00 p.m.ch day at new york. bloomberg technology is livestreaming on twitter. check us out at technology. make sure to follow our global

breaking news network at quick take on twitter. this is bloomberg. ♪

♪ carol: welcome to bloomberg businessweek. i'm carol massar. jason: i'm jason kelly. we are in new york city. carol: this week, the bloomberg 50. from finance to politics, these are the people that shaped 2019 in unexpected ways. jason: plus, a growing pushback on stock webex. carol: and a different type of crisis that asks if homelessness is a crime.