taylor: i'm taylor riggs in san francisco, in for emily chang, and this is "bloomberg technology." coming up, as iran mourns its fallen military general, it down revenge against the u.s.. cyberattacks may be on the menu. plus, it is buy time. pivotal research raises alphabet to a buy largely on the new ceo.

we will talk to analyst michael levine as he boosts his price target. mobility tech is all the rage and uber takes one more step to becoming a one-stop shop for all of your transportation needs. details on the uber bus. first to our top story, u.s. stocks advance. heavyweight technology companies led a rebound. 100 led by companies like salesforce in alphabet, fresh record highs. that means that the small-cap technology companies are looking relatively cheap on a valuation basis. joining us, bloomberg across asset reporter sarah ponczek. take a look at a chart i am showing on a forward basis, looking like some of these small-cap tech companies look cheap relative to some of those big things we cannot stop

talking about. sarah: you are looking at the forward price to earnings ratio of the s&p 500 versus the s&p 600 for both technology sectors. the s&p 600, as you can see, trading at a discount, at the lowest level since 2001. i will say that we posed this chart to jonathan golub of credit suisse about an hour ago and he said, i would not be too quick to count out these large tech companies. yes, we saw the rally, but the earnings picture for small-cap is likely to be a bit rockier. at the same time, many are saying that it is probably time for a leadership shift. you look at 2019, facebook, amazon, apple, microsoft and google, those

companies accounted for 29% of returns. some are looking for any reason that we might see a shift. byron from blackstone puts out an annual list of surprises every year. this year, one of those was that the fangs will likely lose their leadership luster. likely because of the political scrutiny they will face ahead of the election. at least early on in 2020, especially today, we continue to see large cap tech outperforming. taylor: as we get away from some of the bigger tech names, we go into the smaller companies. salesforce, a topic by rbc, closing at a record high. why does rbc see salesforce as a top opportunity? sarah: it seems like the stars are aligning. and i mean analyst recommendations. today we get a recommendation, what they did was they pointed to their revenue forecast for salesforce throughout 2020, through 2024.

they also see room for margin expansion. it is not just rbc. we had also seen suntrust as well, one of the compelling names within the software space. when you go back to rbc, they did set a new price target. they have the street high, a 25% upside. we closed around $173 per share. we have to remember in 2019, just last year, salesforce was the laggard. yes, the stock ended up, but when you compare that to the s&p 500 technology index or the software industry groups, it is less than half of that. 40% gain. taylor: i also want to take a look at netflix. appeared to be snubbed a little bit at the golden globes. did the shares react to a lack of --awards? sarah: we did see a little bit

of a modest reaction, potentially negative, but we did see a pickup. yes, of course, netflix will be facing immense pressure from other streaming services, especially with the launch of the likes of disney plus and others. i am not sure that investors are too worried that a netflix movie did not win the golden globes as opposed to some other production as well. taylor: i want to end on a more serious note. cybersecurity stocks, crowd strike, for one, up 9% today as many brace for what they expect to be oncoming cyber warfare from iran in retaliation. what are you hearing in the cybersecurity space? sarah: we have seen quite the rally across cybersecurity is

stocks. fireeye, lifelock, crowd strike. crowd strike of course is the company that went public just a few months ago in the middle of 2019. bloomberg intelligence says companies that offer threat protection services are likely to benefit more than those that just provide firewall defense services. it is much to be seen, people are still speculating, trying to get an idea on how iran will retaliate to the airstrike that did kill qassem soleimani. we will see how they truly do come out. the idea is that, if they may retaliate through cybersecurity -- excuse me, through cyber warfare, then these cybersecurity's, other companies will need their business.

taylor: thank you for joining us. i want to stick with cybersecurity and escalating tensions between the u.s. and iran. bloomberg has profiled one american businessman who can attest in detail what happened after he provoked iran. i want to bring in our cybersecurity reporter. fascinating profile you did on sheldon adelson. who is he, and what do we know about how he coped with the iranian cyber attack on him? >> he is a casino magnate. in 2013, he, at a conference in new york, was speaking about ways to deter iran's approach against the united states. he suggested if you want to put them in their place, go test a nuclear bomb in the iranian desert. that did not go well with iranians. in the months that followed, his casinos were hacked, he had to spend at least $40 million to secure them.

over the next year, the u.s. government did confirm that it was the iranian government, iranian assets that did infiltrate his system. they do have the capability to push back if threatened and i think that does hint to what could be in store after last week's attacks. taylor: is there any lesson we can take from his experience, sheldon adelson at las vegas sands, to some other corporations in order to prepare? kartikay: it is hard to know exactly. generally speaking, industries across the united states are paying close attention to their own networks if they weren't already. especially the financial sector. they know they are a representation of capitalism in the united states and perhaps low hanging fruit.

we are seeing that by how close lipped they are this week. they do not want to talk about what has happened and how it could impact them. we go to one line response from a group that represents them after the hacked, basically saying we are doing what we always do to protect our infrastructure and we will let you know if we have more to say. taylor: you mentioned the financial industry, how well prepared are the other industries, energy, infrastructure, education are all ones that come to mind. kartikay: the financial industry is one that we deem to be pretty well prepared. they have spent hundreds of millions of dollars to prepare themselves. there are others that are more cash-strapped. obviously, hospitals. they do not have the resources to protect their networks. local governments, we have seen ransomware attacks. they occur because these are easy targets. hospitals. then you have utilities, companies that manage gas lines,

to an extent, power grids. these are industries that are lacking resources or priorities to nail down for abilities. -- nail down there securities that could be targets in the future. taylor: now that we can look back at the last few days, what what are we hearing? kartikay: over the weekend we saw a government website defaced with pro-iranian anti-u.s. messaging. this is pretty common and often automated, but it is a hint that perhaps the slow trickle of attack finding its way into government and private spaces. what we are hearing now is that iran's sophistication has evolved over the past decade. about 10 years ago, the stuxnet attack crippled their uranium facilities. motivated, that has

iran to prepare for their own offensive capabilities. over that decade, we have seen them attack. the saudi government a couple of times, other governments that are fair warning that a similar attack could occur. what that will look like is largely speculation. taylor: still waiting to see. thank you. coming up, alphabet gets a new buy rating. we will speak to pivotal research next. if you like bloomberg news, check us out on the radio, the bloomberg app, bloomberg.com, and in the u.s., on sirius xm. this is bloomberg. ♪

taylor: alphabet was upgraded from a buy to a hold from pivotal research. michael levine says the narrative continues to improve in 2020 and beyond. give me your take. how do we get from a 1397 to a 1650 on the stock? michael: one thing that was most compelling to us, a change in regime with sundar stepping in, as ceo and chairman. but something i think investors may have missed, his compensation agreement was filed under december 20, and what struck us was that he basically is compensated on the percentage differential

that google stock does relative to the s&p 100. he has basically got a $45 million on plan for stock performance in 2021. a second $45 million for 2022. it is pretty refreshing and encouraging to see alignment between management and stock performance. from a company that is historically taken a very different approach to working with the street. taylor: what do you think he can do that the former founders of alphabet could not do? michael: i think it is not what they could not do, it is this philosophy they had that we are smarter than the street, we will beat to our own drum and there is no need to do anything differently than what we are doing. fast-forward, if you look over the last couple of years and you see the kind of disclosures we have seen from companies like

amazon, netflix, alibaba. you are able to see in the example with netflix, they had been running at losses until quite recently internationally, but a pretty wide gap with domestic margins. if you did not have that disclosure and did not understand what was going on, you would have seen this big push. with google, we are pretty on thomas currian, saw that he was quoted in the april time frame basically they were around 1/10 the size of azure or aws's salesforce. his intention is to get it to years.eir size in two that is expensive. you help them understand what you're doing revenue wise, what

the margin drag is, it allows people to better understand the moving pieces. taylor: michael, you call 2019 a critical foundation year. take a look at a chart i am showing in my terminal, frankly, alphabet has been lagging other big faangs like apple, facebook. why was 2019 so critical? michael: the part i was trying to call out as critical is really around the cloud business. the cloud business is where we will look back and see that currian basically got brought in from my perspective underwhelming with their cloud efforts, but has made a lot of changes in a hurry, bringing in key lieutenants for the different regions, making an acquisition of a company called lookr individualization space for $2.6

billion. outside, looking in, what i suspect happened was they actively tried to recruit him and he said, i don't need the job. i am interested but i will only do this if i am set up to win. it is probably a couple year journey in terms of getting the building blocks in place, the right heads in the right seats. but i think he has made a lot happened in a relatively short period of time. taylor: i want to finish pivoting from the cloud to the ad revenue business. i keep hearing that facebook more so than alphabet poised to benefit from 2020 ad revenue growth. do you think they can both grow together or is one growth at the expense of the other. ? michael: i think they can grow together. the ratings have obviously been suffering. money is trying to find a way to get spent. it is one of the reasons we thought that q4 was particularly strong, that ratings were underwhelming. as a marketing manager, you

don't want to have budget left at the end of the year. we think that helped provide some bolster. for context, what is impressive with alphabet, we basically have them forecast growing 24 put in -- growing $24 billion in 2020 versus 2019. facebook, a little bit smaller , $16 billion of incremental year-over-year growth. i think it is fine for both of them. i think both of them can do great. taylor: michael levine, analyst, pivotal research group, thank you for joining us. up, columbus ohio touts its transportation system as one of the smartest. we will speak with the mayor, next. bloomberg technology is livestreaming on twitter. check us out @technology and follow quick take. this is bloomberg.

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taylor: the annual ces 2020 kicked off today in las vegas and the future of mobility technology is front and center. lummis, ohio is one city looking for opportunities to reinvent its transportation system through technology. i am joined by columbus mayor andrew ginther. many cities want to be the new tech city. what have you done specifically in the last year to make yourself a smart city? mayor ginther: we went up against other cities for the smart city challenge. my first year's mayor in 2016, there are so many things that

connect, the integrated data exchange. we now have autonomous shuttles we have been using in downtown columbus. we are going to launch this month the first one in america that will serve residents in a neighborhood. we believe in columbus that mobility is the great equalizer of the 21st century. we want to make sure we are using innovation and technology to help people improve their own lives. taylor: the first self-driving shuttle operating on public roads in a residential neighborhood. given all the safety concerns, how did you overcome that to make sure you are efficient but safe? mayor ginther: we started working with the residents of linden. that is where the shuttle will connect residents to the community center, the settlement house, other opportunities. continuing to work with federal, state, and local officials. we have been working on it in the last month, and it will go

live for the public in january. i am going to be on the first shuttle, letting them know it is safe for them and their family, but also taking into account that there will be schoolchildren. we will be limiting the hours just to be extra careful and reassuring the public that this is a safe way to get where they need to be. taylor: you said you would be releasing ev's to the fleet by 300 2020. 2020 is here. how are you doing on that goal? mayor ginther: we have continued to grow that. over the last three years, we are at 121% growth in ev adoption. the country is at 94% and the midwest is at 82%. our goal is to have that ev penetration. we at 0.3%.started we were

we are currently at 1.2%. making great strides in ev adoption and it is because of this great public-private partnership. we had $90 million put up toward a local match. the $40 million came from dot and $10 million from philanthropies. we are now up to $730 million in aligned investments in our smart investment work with a goal of a billion dollars by the end of this year. taylor: we talk about 5g on this program, how it will be transformational. especially for midwest regions. where are you in the race for 5g? how beneficial do you think it will be to columbus? mayor ginther: another way we are collaborating with the private sector, protecting the right-of-way interest but working with these providers. our big focus is on equity. making sure that as we are

growing dramatically, we are doing it inclusively, making sure that residents of neighborhoods throughout the city can access and benefit from 5g technology. taylor:iring tech workers, millennials want to be in tech, where are you in being the next tech center? mayor ginther: we believe we will grow by one third over the next 30 years. we know that growth will be dynamic and dramatic. we want to do it inclusively. as more people call columbus home, we want to make sure there is a place in our future for the people of columbus who have made it so special. taylor: thank you to mayor andrew ginther of columbus, ohio. coming up, tensions continue to rise. the u.s. braces for a potentially iran cyberattack in retaliation to that deadly american attack. we discuss that next. this is bloomberg. ♪

taylor: this is "bloomberg technology." e join "bloomberg daybreak: australia" to bring you the latest tech news. let's take a look at the top mobile tech stories of the day. >> let's start with china. bloomberg has learned that the chinese trade delegation plans to sign the first phase of the deal with washington. that is on january 15. the funny part of the story, a chinese newspaper says the group originally planned to travel earlier in the month. plans when alter the

trump tweeted that it will be signed on the 15th. food ordering software, ordering an initial public offering where it could see a valuation of $1 billion. the shake shack founder sits on the board. xerox, a loan with banks that continue pursuit of hp. it is the largest ever bridge loan in the tech sector surpassing ibm's $20 billion for its acquisition of red hat. the xerox bridge is also the first jumbo acquisition to emerge in the loan market this year. those of the top tech stories we are watching. taylor: let's get back to our top story of the day, the u.s. air strike that killed one of iran's top military officials is raising the spectre of a cyberattack from iran. cybersecurity companies gained after the increased risk of

attacks will result in more business. for more, we are joined by the senior director of intelligence analysis at fireeye. great to have you on the program. what have you noticed recently anyhe last few days of pickup in activity or potential attacks we may have thwarted already? john: our biggest concern now is for the physical safety of some of the users we have worked with. we have seen iran after incidents such as this, when tensions rise, carry out cyber espionage. we are concerned about cyber espionage. we have seen them develop a surveillance capability where they have tracked people through their telecommunications providers as well as travel companies. our concern is that with any kind of physical threat, this espionage or surveillance capability would

allow them to get closer to someone of concern. >> we know that hackers from iran have not been inactive over the past few years. people are expecting or bracing for heightened activity. what are the targets they are looking for at this point? john: we have been able to study them and view them in saudi arabia where they have been active. what we see is they are focused on critical infrastructure, places that provide services, organizations that have very complex systems where they are seeking to disrupt those systems with viper attacks, malware that basically erases hard drives. it can cause some serious monetary damage and grind businesses to a complete halt. taylor: i hear that the

financial sector, least of all, is most prepared. what about other sectors infrastructure, , energy, education? how prepared are these four, -- how prepared are these for let's say, a viper attack as you just mentioned? john: a lot of organizations have taken a proactive approach. within an hour of notification of the operation, we were getting questions from our customers from a variety of different sectors. oil and gas, government government, municipalities, and others. they are taking proactive steps to prepare for the tactics they know the iranian actors use. the real good lesson we have learned, the ransomware incidents we have

already faced in the united states. the wiper incidents are really just ransomware without the ransom. >> does a level of dominance and reliance on the tech sector in the u.s. economy make it particularly vulnerable? john: yes. we have an incredible cyber capability of our own. every time we have seen it, it has been head and shoulders above others. the problem is, our level of technical sophistication is also our weakness for asymmetric attack. the adversary can take advantage and disrupt our systems. we have seen a lot of good examples of that. when russia launched a ransomware attack on ukraine, we saw billions of dollars in

damage to companies that worked in logistics, manufacturing, very complex systems that simply stopped. taylor: how advanced have these iranian hackers gotten in the past two or three years? john: when america first had a series of incidents with them, particularly in the financial as well asdent, destructive attacks against businesses, they were just learning how to do a lot of this stuff. they had not matured yet. after the nuclear agreement, we watched them stop focusing on u.s. targets and focus more on the gulf. while they were doing that, they were improving their capabilities. iranian actors that we have seen orthe past are not the same not at the same level, they have improved, they have new tools

and tactics. they have been very successful. crucial election year, are we expecting fake news to intensify? absolutely, we saw that in a short period after the operation, and that will carry out through the election. they have been very prolific disinformation and have invented new tactics we have not seen before. taylor: how much economic damage are we talking about in the u.s.? john: we do not expect an iranian attack on a larger scale to cause major economic damage. we are concerned about major damage to single economic participants, single companies, in my experience extreme damage,

but we do not expect it to cripple our economy. if you are one of these companies -- and we have seen where therebefore is a large attack and only a few companies took the brunt of that, but they took major hits. >> great to have you, thank you for your time. lots more to come. stay with us. this is bloomberg. ♪

taylor: if 2019 was the year of tech shakeups, what is 2020? some who left the helm his alphabets ceo, expedia's, and

adam neumann who abandoned ship when the ipo collapsed. like everything with these departures can come opportunities. when will we see more women and diverse backgrounds? it is the topic of this week. boardspan joins me now. as you look at 2019, what do you make of that ceo turnover? .> there was an awful lot it surprised me when i looked at the statistics, there were 1500 ceos who turned over in 2019, a record year. that comes from a few different things, one of them is we are looking at 2020 as the year of accountability, and that is what we saw for ceos in 2019. what are ceos expected to deliver?

is they need to make investors money, and they cannot screw up while they are doing that. if you look at that turnover, it often came because ceos were not making money that investors were expecting, or they were making awful mistakes. oflor: in all of your years looking at this, did 2019 feel cyclical, or was there a structural shift were people are saying we will hold you accountable? abby: i think it is more of the that ship has sailed. accountability comes from a few different areas, the business roundtable came out with a big statement in the middle of the year. and howeeing it investors are behaving, and what we would call activists versus passive us who have blended together, and more demands from investors as well. taylor: when we look to 2020 and

accountability, one of the main things you are keeping an eye on for this year? for 2020 the watchword for boards will be accountability. we are seeing hints of that already. massive free working of the bed, bath, and beyond earlier this year. investors and regulators and employees, nobody is off the hook anymore. at after an you look ceo step down and there is a big shakeup, what do you see with the incoming executives? is there enough of a diverse group? abby: the thing to remember about ceo turnover is that there ,re two ways to address that and it is in the category of things copper fresh in. it is a board has the opportunity huawei to plan this out, it is a multiyear process, they will get a smooth

transition in the face of tragedy. loss of markmely hurd, they were as stable as could be, prepped and ready to go. alphabet,e case of you had a guest talking about alphabet, i do not think that was a big surprise, sundar was in the wings ready to step in the role of ceo. adam neumann, your other example, took everybody by surprise, his whole board and adam himself. taylor: this chart we are showing in the terminal, i cannot put it on social, but we have created a customized index, a watchlist showing women on the board. the most is oracle at four. you go down the list, it seems good, not great. have we done enough?

abby: there is clearly more work to do, and these are larger companies. on a smaller company side, you have some surprises. hp did not show up because i like to show them as a good example. fix,lso stitch , they have good examples of diversity on the boards. those are california-based companies. my producer pointed out in california there is a new law if you are publicly traded, one female on the board. if we needed a law, it means we were not doing enough. what did you make of that? abby: this is the california law you are referring to, i am a capitalist at heart, so in the perfect world we would have gotten diverse boards through the right reasons, but we did not.

sure enough the law has had the desired effect. there are 40 companies that have yet to comply, and we will see what happens, it is up to the regulators. no question we cut the number of boards who have no women in california by two thirds. it was close to 120 when this law was put into effect, it has made progress. taylor: i come from new york and we talk about the financial industry lacking diverse backgrounds, then you come to san francisco and people say tech is way worse. why is tech so bad? abby: there are references to bro culture. it starts at the beginning, and this goes back to professional planning, getting diversity, whether it is about gender, comes witholor, age who you bring in earlier into the whole process. it is important to cultivate

those people and bring them along, that you have choices. the ceo of oracle spent a lot of years, and earned her role. taylor: all was a fascinating conversation, think you for joining us. still ahead, qualcomm president joins us next. this is bloomberg. ♪

taylor: uber option to its transportation menu, it rolled out uber bus monday, and

customers can use the bus. details on the ride around vegas with bloomberg. strategy. a change in we are trying to put the riders first, to build trust and loyalty. public taking transportation and not uber is in their best interest. knowing we have their backs, we believe we will build up loyalty over time, what is best for the riders and uber. it is revenue-generating, they are getting the same amount they were before. we are not adding any surcharge. >> what is the benefit? >> it is about the lifetime relationship we are building with our riders, where uber is

the one-stop shop, the first app they pull for any mode of transportation. >> what about outside the u.s.? what other plans do you have around the world? >> the amazing thing about uber, it is such a global business with 700 cities with uber ridesharing, and 4 million active drivers on the platform. we are looking to go into more cities around the world. public transportation is everywhere, the backbone of how people move around their cities. it is not just denver and las vegas, but new york city. delhi and all around the world, it is exciting for us to take transit to more places. we are live in 15 cities including las vegas, and with our second city as well.

>> what is the timeline for rolling this out on a global scale? >> the reception has been phenomenal, we will accelerate the phase of launches with transit and transit ticketing over the course of the year ahead. >> one of the project underway see thatgas, could we on the uber app? loop is a fascinating undertaking i am interested in, and we will see what happens in the future. >> nothing with elon musk? >> nothing we can discuss today. taylor: that was uber's head of transit. qualcomm unveils its first chips for fully autonomous vehicles on monday. qualcomm's president, cristiano aboutspoke with bloomberg

what he calls the natural extension into this space. >> we are excited, i would like to expand our offer and get into autonomous. we believe the cars will have to process so much data and require so much processing capabilities, it is going to require a completely different equation about power. coming from the cell phone industry, we have the ability to do chips. they are efficient from a power standpoint. you cannot run a data center out of the trunk of your car, and that is the opportunity for qualcomm. solutions from +,vel one to level four autonomy. but the commercial opportunity will be to add autonomy to every car as a convenient teacher with a driver behind the wheel like cruise control. that is the real opportunity qualcomm has to rescale this,

and we are pleased to announce the expansion of our relationship with general motors to include autonomy as well. a significant milestone for the qualcomm automotive business. >> when we talk about the and competition in this space, a couple months ago how it was scaling up at a pace that it said is faster than competitors. is this going to be about what you do at qualcomm internally, or you look at m&a and buying smaller players? is a greatthat question. we have been building in our automotive business organically. becometo connectivity to .umber one in telematics then we went to the digital cockpit transformation and

ecame number one with 19 oem's engaged. autonomy is a natural extension of our computing capabilities becoming more powerful for better powered devices, that is what you see in phones. for the car ass well. we could see further acquisitions, but will be. we feel good about what we have done to build our platform with organic efforts. >> there are going to be flashy thats thrown out at ces will make you believe this is available tomorrow. with autonomous vehicles, we are not there yet. when is qualcomm betting we will get autonomous vehicles? that is where the differences, while we have a platform we can do full

autonomy, we are focused on level two and three which allow you to scale and make this a commercial good proposition for us and our makers. in the platform we unveiled, we expect to see cars on the road by 2023 with what we call level two plus or level three, which will have full autonomous capabilities with the driver behind the wheel like a feature. that is what we think the scale will be and what we think will become a commercial reality. taylor: that was cristiano amon, president, qualcomm. that does it for this edition of "bloomberg technology," which is live streaming on twitter. check us out @technology and on quick take on twitter. this is bloomberg. ♪

manus: our top stories this morning, tensions between the u.s. and iran rise again. the pentagon since additional forces to the middle east as washington insists it has not made a decision about leaving iraq. meanwhile, investors seem to be shrugging off geopolitical strife. why isn't the selloff worse and what would it take to make markets crater? musk attendss elon a ceremony to mark the first deliveries of his made in china vehicles. and carlos ghosn is ready to name