>> i'm taylor riggs in san francisco, in for emily chang, and this is "bloomberg technology." interference, we continue coverage of cyber risks from the relationship with iran looking at the threats you can't see. alphabet'smissed, top lawyer leaves after questions about a workplace relationship persists. they say it is time for new leadership at the company. and the week that was, elon musk

has a reason to dance, and apple hits more milestones, plus highlights with team monster. our top story, the trump administration is imposing new sanctions on iran, retaliation for the attack on u.s. military bases. the sanctions target the steel industry, as well as eight senior officials. while adversaries did not get into traditional military war, they continue cyber warfare remains. cybersecurity film dragos published a report highlighting hostile hacking activity by an iranian group against u.s. power suppliers. for more we have the president of gullah tech adventures, prior to that he was a hacker for the nsa. with me in the studio is the proof point executive vice president. ryan, let me start with you. what increases have you seen

coming from iran targeting the u.s.? ryan: we have seen the continuation of campaigns at they were already running. perhaps the most interesting thing we saw was we saw some of them move from diplomatic targets, public policy targets and government targets, the classic intelligence gathering activities, to targets of civilian organizations, particularly life-sciences. emily: ron, what do you see as the path of least resistance for iran to do the most damage on the u.s.? ron: iran can talk or target soft targets, people like you and me, small businesses and corporations. anybody out there who is the gate about protecting themselves, they need to think about their connections to the cloud and what they can do to increase cyber hygiene. taylor: you mentioned to civilian targets. a little bit of a shift in strategy. what do you mean when you say civilian targets?

,yan: private corporations instead of ngos or policy organizations, or something like government entities. when you put yourself in the shoes of the iranians, they are about the deal with much tighter sanctions. they have to provide things like essential medicine to their population, so it would make sense to target life science groups. taylor: when you look at sort of the access to u.s. utilities, is that sort of a very classic way in which they could do harm, creating chaos via a blackout for example? ryan: the russians have used that playbook against ukraine. the iranians, we have seen targeting utilities over a fairly extended period, and they have done destructive attacks. that has not translated necessarily into actually taking power grids off-line, that would be a different level of expertise, but all those things are on the table when it comes to planning for defending. taylor: ron, you seem to take a

different point of view that perhaps we wouldn't see a mass blackout type of scenario. why do you think that? options when many it comes to taking action in cyberspace. if they did something like attack the city of baltimore, the city of atlanta and claim credit for it, they will invite a strong response from the u.s. and i do not think they will do that. having said that, their goals are going to be gathering information and intelligence about u.s. policy. so anybody who is a vendor for the u.s. or working with the u.s. government, they are potentially a target and they should be getting a second look at their cyber defenses. taylor: that brings us back to ryan. as they look at going back to their cyber defenses, what do you recommend the corporations, even people perhaps, what can they do? ryan: look at what the iranians are good at. they are good at social engineering, excellent at running phishing campaigns.

they are very compelling, the sort of things people will click on, were they not aware of the threat that the attachments to emails may pose. they have also hammered on cloud services. the iranian playbook is similar to the cyber criminal playbook in general. ron is spot on, everybody should be concerned, but the things you would do to defend against iranian attacks work in general. the other thing i will point out securityrt of homeland has fantastic advice on how to keep yourself safe, one thing was off-line backups. the same thing we heard about in the ransomware crisis, that has affected cities and organizations around the country, it is a way to prepare yourself for a potentially destructive malware attack. taylor: ron, what do you think of, should the u.s. start hacking back? how do governments and corporations -- what are the

ways for them to brace for a potential iranian cyber warfare? ron: i do not think we really know what cyber warfare looks like. if compare their abilities with the u.s., president trump, after the drone was shot down, we took offense of action as reported. that is different from the cap abilities of iran. they target businesses and corporations. that is where us as u.s. citizens can have an impact, by controlling what is on her own network. ryan, thank you both for joining me. and coming up, the first phase is about to be done, we break down what to expect in next week's trade deal and what is left for phase two. check us out on the radio, you can listen on the bluebird app, bloomberg.com and on sirius xm. this is bloomberg. ♪

taylor: president trump says the u.s. and china will sign a historic phase one trade deal and the president's economic advisor laid out what this means for the tech industry when speaking to bloomberg on friday. >> we have tremendous amount of progress on intellectual property and the avoidance of theft and counterfeiting, a tremendous amount. and with respect to the transfer of technology, some progress has been made too, more will spill over into phase two. taylor: to take a look at phase one and what is to come, in new york, we have a senior fellow from the asia society, isaac stone fish. and sarah mcgregor. let me start with you, sarah. we are still waiting on phase one, what are the odds we could see a potential for phase two?

sarah: so the expectation is on wednesday of next week, on january 15, a chinese delegation, led by the top trade negotiator, will be in d.c. and assigned the phase one deal. we have heard that we should receive an actual text of what is in the deal. we have comments from people, likely just played at larry kudlow saying there are things on ip theft and detect transfers and other things, but we have not seen the nuts and bolts. so i think that is the first thing that we need to check off the list. after that, we see potentially the phase two part of the deal starting. that being said, donald trump said this week it may not come until after the election. so i think there is skepticism about if he is reelected, will that ever come, will the political motivation be there for him? taylor: isaac, your thoughts on what we have in phase one, and

if it leads us closer to face two. isaac: i think it has to lead us closer because it is already going in that direction, but i also think we have a very little in phase one, it is like an agreement to have an agreement. and it seems pretty short on details. i also, with donald trump saying, maybe we have to wait until after the election, it really does seem to be a trust me, i am working hard for you, here is a little bit of a deal, vote for me and you will get more of a deal. we heard at larry kudlow -- taylor: talking about getting big concessions from china with relationship to technology, like the ip theft, like the force to technology transfers. what specific details, as we know the devil is in the details when it comes to trade deals, what are you really looking for as it relates to those topics in phase one?

issue in may was a china had come back to the u.s. with a draft text and really scaled back on some of their commitments to codify into law changes that would help protect intellectual property of foreign companies, like those u.s. companies working in china, and other commitments. it shrunk back from those. and there is a complex system there on how they codify the laws with many different layers. the u.s. was not happy with what they were offering. so i think a key question, when people look at the text and learn about the details of chinese law, it will be whether they actually made a hard and fast commitment. if they do not live up to those commitments on ip theft or tech, what will be the repercussions? what is the enforcement mechanism in place so the u.s. can say you are rolling back on these commitments you made? taylor: why has it been so difficult to get everyone on the same page when it comes to ip

theft and the forced tech transfers? isaac: you have a couple countries with different interests. i think like it was with the u.s. and the u.k. 150 years ago, a lot of the best technologies are in the hands of american companies and the chinese companies want to get their hands on that technology. and some of them use illegal means to do so. on the one hand, there are many people inside the communist party who want the country to be ruled more bylaws, as opposed to the party, but many at the top of the party feel like what the party says is what should matter. so if a certain company, if they are forcing a technology transfer, or actual ip theft, if it is in the interest of the party they think they should do it regardless of laws. taylor: when we came out of the phase one news, it was clear

apple was the clear winner of tariffs on the iphone. so what other companies do you see really benefiting on the signing of phase one? isaac: i see tesla benefiting, because they are doubling down on their plants in china. that crazy dance elon did in shanghai. there are a lot of companies that have a lot at stake in this relationship and it's less about the numbers, but more on whether or not the party and also chinese consumers a feel-good will toward of the company. we saw this with apple and the chinese tech giant huawei, when the canadians arrested the cfo, there were people who wanted to boycott apple. so there are issues about the goodwill that the chinese feel toward american companies, and at the party feels toward

american companies, that could play out in interesting ways. taylor: sarah can you cover economic policy, does any of the u.s. goodwill from american companies help? we talked about tim cook having a good relationship, and elon musk over at tesla going to shanghai to try to build a factory, does any of that make a difference? sarah: i think it makes a difference on the trump administration -- we know that steve jobs, for instance, spent time at the white house and has met with donald trump, and for that reason apple has been able to escape the tariffs, get exclusions for instance, and that is an indication of the leverage some of these companies have. they of course want to keep access opening to the chinese market. the trade war started on the premise of the trump administration saying it was going to bat for businesses, trying to make it easier for them, when really i think what we are hearing from the companies now is there has been

harm caused to them and they want the dust to settle more than it has been for the past couple years. so the push for a deal is part of the corporate lobby that the trump administration has of companies that want to keep their foot in china and expand. isaac: sarah mcgregor and stone fish, thank you. more employees is stepping down from google. we will find out what happened, next. bloomberg technology is on twitter. check us out at technology, follow our breaking news network on twitter at quick take. this is bloomberg. ♪

taylor: another shakeup at google, david drummond is retiring at the end of january. he steps down following questions about his conduct at the tech giant. this comes after a recent

departure of their founder, larry page. and sergei brain. he was the first lawyer for google, before shifting to alphabet in 2015. for more i am joined by mark bergen. what do we know about the departure? mark: this was a long time coming. david had been there for a long time. he was formidable in its early rise. he has been associated with the old school google, but more recently with their problems around men, in particular, and allegations of sexual harassment. so he was the top lawyer when the andy rubin dispute came out, the former head of android, when he left and a spirit of the google walkout. he has had issues with allegations with extramarital affairs, with a formal google employee. there are many women at google who are asking, why is he still around, what sign is it showing? now a month later, david is

stepping down. taylor: what does this tell us about google shifting strategy, perhaps taking a closer look at relationships conducted in the workplace? is this a shift on a broader level? mark: i think there is external and internal pressure from their own employees and from the general public after the me too movement, a general consensus that this sort of baggage that the executives had was much more of a hindrance. david, like the founders, has taken a step back, he has retreated from day-to-day operations. he was running and managing google ventures and capital g, their investment arms, as well as jigsaw, but he was not involved as much as he was a decade ago when he led their development and legal strategy. taylor: i think it brings up the bigger change given the shakeup and top management that we have seen. we sat here last year when sergey and larry step down, no

offense, we said nobody cared because it was so clear of his strategy following in the steps of google. is there that same kind of -- in the next generation of the legal team we had when the founders step down and we had so much confidence in the new ceo? mark: yes, he was a deputy under david for a long time and before that i think google has had the largest legal team of any company. this question is more around or the other parts of alphabet. so david german was everything not google. it is not name replacement, it is not clear if there will be one. it will be interesting to see if they appoint somebody to run what he was effectively doing, which was the legal and corporative development for everything from waymo to other divisions, if they think they need that, that executive level seat. taylor: mark will stay with us, because i want to talk about another google story.

stumble,ke of amazon's google expands in new york city. it has added thousands of jobs inthe chelsea neighborhood 2006, without provoking much ire. joining us to talk about this story is natalie wong. to talk about how google has navigated the landscape in the city, natalie, what did they learn from amazon in deciding to take a different approach? natalie: the lesson you can see in contrasting their approach to building an empire versus amazon is it takes time, you have to be incremental and you must look -- work with the local community. google set up shop in the chelsea neighborhood in 2006, while it was gentrifying, but they least to the space first then started to buy up the real estate, expanding further, while working with the community in chelsea. whereas amazon came in in a public way and did not really engage with the local community

on the grounds of long island city and that was a hindrance to them when they had that critique against them when they announced they would set up shop there. taylor: we have a visual picture here of google's presence in new york, and there was a strategy that struck out to me, they are not building these big tall glass modern buildings. they are also taking a different monetary approach, not asking for subsidies. what do you make of those two strategies? mark: the first one is different from their headquarters in mountain view, they had these big ambitious plans a couple years ago and they hired an architect. they were going to do modular offices. it was like a google moonshot. and one is much more muted looking at the reaction to amazon, the backlash, google clearly wants to be as far away from that as possible. the other interesting thing about their strategy, when they

initially got that large building in 2010 in new york, that was above the fiber-optic cables, so a lot of what they do is they think about how are we going to actually work this with their data center, piping in internet as fast as possible. so there strategy depends on their datacenter use and the speed of their services. taylor: natalie, it is notable that they are not asking for subsidies, because that is where amazon was criticized, has that also been part of their take, we will not ask about subsidies either, we will go in, develop the neighborhood and work with local regulators? natalie: that has played a role in their success in manhattan. with amazon, subsidies did not work out well. and they just announced a big lese in hudson yards, around the same neighborhood as chelsea, where google is located and they signed a lease that will house 1500 workers without subsidies. taylor: natalie, what is your

take on relationships with the politicians? we remember aoc, a strong critic who was outwardly bashing amazon. has google done a better job with working with the regulators on the ground? natalie: it is important to cultivate local relationships, and we found out that google has worked closely with the community activists, the politicians and local organizers to make sure they get ahead of any issues or complaints before they come out to the public and there is a big outcry, as we saw with amazon. so for the most part they have avoided that public outcry with what they have done in chelsea, which in a way there has been gentrification since google came in, it is not perfect muslim local residents do complain that the local businesses are pushed out and employees, they are just in a big bubble, they come and go to work, they eat in the building and they do not spend money on the local businesses. so there are these critiques

that the local residents mate, but for the most part it seems they are trying to work with the local community, the activists and politicians to make sure they stay ahead of these issues before they get out of control. taylor: market, new york is a clear number two to silicon tech hubsterms of tech cups? mark: you have seen a big presence in seattle, austin, google cloud is trying to cut deals with oil and gas companies. and i think that a lot of companies in silicon valley are aware of the price of real estate and housing prices here in the south bay, so i do not know where the second home will be. taylor: natalie and mark, thank you for joining us. coming up, we will break down the weekend to see what is ,oming up with eugene munster

apple sales are surging and grubhub's future as an individual company. this is bloomberg. ♪

taylor: this is bloomberg technology. i'm taylor riggs. all week, some of the biggest names in tech gathered in las vegas for the annual ces conference. the main theme centered on connecting and interconnecting devices to the internet and to each other, as we get closer to wireless in a more automated world. 5g playing a big role in the conversation. to discuss this and the other big tech stories of the week, we are joined by jea gene munster and john butler. as you take a look at the highlights, what stood out to you this year relative to previous years?

toyou mentioned at the top, me, the big overriding theme was about interconnecting devices and getting devices connected to the internet. what i mean by that is the connection of everything, not just your smartphone or pc, but also your refrigerator, your car, your television. that was sort of the talk of the town as i went from discussion to discussion. everyone brought that up. of course, underlying all of that needs to be a foundation of 5g. taylor: gene, as you take a look at ces, big notable changes in your opinion? gene: i think it was more subtle. turnthink there was a page from this connected devices, like john talked about. i think there was this progression in previous years, but more this year about the intelligence layer.

machine learning, a.i., but i think there were some pointed examples of how not just a connected device, but a smart -b toothbrushn oral that sense is if you are pushing age,ard, and based on your could impact the health of your gums and your enamel on your teeth, things like that. this next step forward, that was one piece. what also caught my attention, we are getting closer to foldable tech. foldable computers, phones. lastly, wearables. even though that has been around a long time, i feel like that is continuing to move from a small percentage of people to eventually it is going to be on everyone's wrist. taylor: john, i'm reading through your note. amazon big and google talks integration. it made me think we are talking about being seamless and interconnected and being on the

omnichannel. how close are we from going to my house to my car and going from alexa to my google device? are we truly going to be able to go everywhere despite any hardware or software? john: i think to answer it this way -- we are going to get seven to 10 years down the road and be astounded at how far we have come. i think between now and then, the network needs to get built to support this, the 5g network. my best guess is we are really here in the u.s., three to five years away from really having major coverage across the top 100 markets in the u.s. then, you really need to seed the market with devices. again, i think we are in for a seven to 10rprise years down the road, but in the meantime, we are in what i call that build phase leading up to

it. taylor: gene, would you agree we are still a few years away from 5g despite all of the hype and all of the talk? this may not be a 2020 story, as john mentioned. gene: definitely not, i agree with john. i have a slightly different timeframe but agree with the takeaway, which is 5g is away. we have been influenced by the carriers, using phrases like nationwide by the end of 2020. but that does not really speak to the true coverage, where you can get consistent coverage through the day. that is what john is talking about, five to seven years. we are at a point of 75% of the u.s. coverage sometime early in 2022. i think we are probably two years away, well behind some of the expectations. it is important to take away from this even though 5g is going to take longer than we think, i think it's impact on

how we use devices and what we can do is going to be more profound than what we can imagine. taylor: john, how behind our week relative to some of the other asian nations which frankly already have nationwide 5g? john: i don't think the early part of the race is all that important, but we are behind countries like south korea, for example. believe it or not, some of the nordic nations are ahead of us. you know, as gene said, i think within three years, we will probably reach that nationwide coverage at least in the top markets. market whereind of you finish, not where you start what really matters. i think the u.s. will get it needs to be pretty comfortably within a five-year timeframe. taylor: gene, final question on 5g. rage all the hype, all the especially as we talk about a.i.

and some of the major things that can be done on 5g speed, whether live up to its hype? gene: i think it will. it is important to note that 5g is not about faster downloads for video starting faster on your phone. the ability to take a cloud scale computing which is currently done in the cloud, to be able to do that on a mobile device is essentially what 5g enables. right now, the speeds are not fast enough to do that. the processing is done on a connected device, a mobile phone or other internet connected device. opportunity ofat adding cloud scale computing to a mobile device is a big deal. what it empowers is augmented reality moves forward, you look at autonomous vehicles, vehicle to vehicle communication, and just intelligence at a cloud

scale in any connected device. it's quite remarkable what 5g ultimately can do for us. taylor: john, you mentioned not only is it the 5g network but the devices that are compatible with 5g. there has been a lot of hype about apple and the upgrade within the iphone cycle, even without a 5g phone until next september. have you view apple in the midst of this upgrade cycle? john: i think the big upgrade cycle will begin when the services get out there. in other words, i think the tail wags the dog if that is the right way to put it. you need the network first before the phone sales will follow. i think by the time apple comes out with a 5g iphone in september, which is the rumored date, at that point, we will have nationwide coverage by at&t and t-mobile. by nationwide coverage, it is ultrahighto be the

data rate version of 5g we will see probably three years from now. but in the meantime, people that want to tap the 5g network with an iphone are going to get the chance to do it come september. taylor: gene, you have been pretty bullish on apple in part because of their exposure to china. iphone sales in china up about 20% in december year-over-year even though the broader market showed signs of slowing. does that positive news in china reiterate your thesis or is it perhaps more positive than you expected and now you are reevaluating an even higher fair value for apple? gene: more on the latter camp. reevaluate higher value. perspective, china has taken a step forward in the december quarter. if you think about apple story more broadly, this is an opportunity tea-- i have not

seen this for a decade. really, the next two to four years should be incredible for the company. in this 5g, there will be disappointment initially with the initial 5g phones and the initial demand for iphone 5g, but make no mistake, this is going to be a massive upgrade cycle. that is one piece to get excited about. i think the wearables, the services, all of that. when you put it together, what matters most is earnings. we have seen it drift back towards that. apple has, the fact as much income as faang combined should yielded a multiple to companies to google and microsoft. that is a 21 multiple when you add that to apple's earnings next year. price, 50% higher than where we are at. a long ways away, but that is in my view fair valuation.

taylor: gene, another big story of the week had to be grubhub. up 13% on wednesday on news they could be bought or they by someone else. grubhub comes out and says, no, we are not for sale. do you think grubhub should be bought or buy someone else or standalone? gene: i think it should be part of a bigger company. very similar to what target has done for the last mile delivery. ultimately, these businesses really hum when they have the scale of a lot of orders behind them. this is a crowded space right now. i'm in the camp that somebody like walmart ultimately should acquire grubhub and see that as the best path forward. i think being the switzerland has a lot of these companies are today to multiple providers does not drive the types of economies to scale that they need. thelast piece is some of retailers really need to solve

that last mile, that last single hour livery window opportunity. i think grubhub would be a great addition for those companies. taylor: john butler of bloomberg intelligence, thank you for joining us. gene munster of loup ventures, you will be sticking around with us. ith elon musksla w dancing. we break down the asia ambitions with gene munster, next. this is bloomberg. ♪

taylor: earlier this week, tesla ceo elon musk had something to celebrate. tesla kicked up in china and the

company handed over the first china made model 3 to the public. now tesla's growth potential in the country is exciting wall street. running up the week, analysts boosted their price target by more than 30%. still with us is gene munster of loup ventures. i have to ask, again, as you sort of saw that big jump in china and the big success in china, is that why you had predicted or were they more successful than you thought they would be? gene: it moved faster than what i thought. they had set the expectation of the gige factory in china to be producing cars by the end of 2019. given tesla's history of missing targets, i expected that to be sometime in the first quarter. they did it in a year which is remarkable. give them credit for doing that. i think when you take a step back and think about what does that mean for the company more

broadly this year, the analysts overall our thinking somewhere between 30000 and 100,000 vehicles from shanghai. at the current rate, the current capacity -- this is surprising -- it is already producing 3000 vehicles per week. it can produce 150,000. the question is will they sell all the cars they produce? i think when you put all of this together, what investors are going to be looking at keenly this year is will they hit that 463,000 delivery number four full 2020? adding another 100,000 from youa, i think giveets quickly to that goal. taylor: i think the numbers you said were 3000 a week. we remember elon musk talking about that quote production hell that he was facing in the first round of the model 3's in california. how did that avoid that in china? gene: they are basically building these factories, almost

printing them out. they have already done that at blueprint. i think this is clearly evidence that they are getting better at making cars. if you fast-forward two years now as they move into germany with the berlin gige factory, that should ramp up quickly there. that is essentially how they do it. they work out the problems in fremont and now have exported that to china. taylor: this is a question that is not quite a fundamental analysis question but i am curious to get your thoughts. when we talk about china and trade, a lot of the risks, micron for example, you go over there, very successful but then china steel technology and kick you out. is that a risk when you look at tesla going over there, getting very good reception? is their technology patents strong enough to resist any potential theft from china? gene: i think tesla has a different view about patents. the company is more of the

nature that they will get the technology out there. they have done that with some of their autonomous technology, put it out there for other people to use because they figure someone else will copy it or steealal it. ultimately, you need to move in a different direction to have a competitive advantage. i don't think that is a particular risk for china. i think that awareness that you cannot really rely on a patent to be successful, i think that insight from tesla is something that is somewhat unique and a competitive advantage for them. two kind of add another piece to that, they are embracing even further -- they are going to do a studio design studio in china that will produce vehicles just for china that will be less-expensive versions of model 3's. maybe a model 2, whatever he would call it. that is an example of them fully embracing the good and the bad,

and ultimately, seeing a large opportunity in china. largest e.v. market in the world. half sold globally are in china. taylor: i want to take a look at a chart i am showing. it was another big milestone this week for the company. their market cap eclipsed $88 billion this week. it has fallen down to $86 billion, but notably, it eclipsed that of both ford and gm combined. who are tesla's competitors? can anyone at this point keep up? gene: well, i will start with the -- over time, the stock will go higher. i think it will be an up-and-down road for the stock, but i do think it goes higher. i think there is competition out there. i don't think the competition has a material impact in their business. in the u.s., they have 70% share of the e.v. market.

that is difficult to sustain. if you take that down to over time 20%, for example, that would outpace gm's market share in the u.s. the answer is it is difficult to compete with them and i think they will continue to make fast tracks towards that 463,000 vehicles this year. taylor: one last question. what did you make of elon's comments when he said the model y what eclipsed demand of all the other vehicles combined? gene: appreciate the enthusiasm around it. i think it probably won't be the case. i mean, they still have some as opinionateduck as people are about that -- model y is going to be a big success, that is his point. i would agree with that. taylor: i always appreciate the enthusiasm. gene munster of loup ventures.

thank you as always for joining us. still ahead, facebook finally makes a change in its political ads, but is it enough to quiet critics? that is our conversation next. this is bloomberg. ♪

taylor: after months of resisting criticism about its political ads policy, facebook says it will now give users the opportunity to see fewer political ads, social issue ads in their feeds. the social network still maintains its stance against back-checking politicians. facebook announced the new user settings on thursday. to discuss, we have kurt wagner here. why now and why the change? kurt: perhaps you have heard over the last three months that everyone is very upset with facebook's ads policies. they have been saying routinely that they are looking at different options around ad targeting. they were not really committing to revisiting their fact

checking ads. there has been a lot of discussion. they came out with this blog post and they did not really actually change any of the policies people are upset about. they said here's a new setting for users. if you want to see fewer political ads, you can check this new box and we will show you fewer ads. that is on you, the user. our policies are not changing. taylor: from the user perspective, i wonder if there has been positive reception. if i go on to wish my cousin happy birthday, and not going onto have political dialogue. does that help with the user's perspective, that they can ignore political ads? kurt: that is what facebook would argue. there's a very valid argument to be made. not everyone wants a political experience when they log on, especially instagram. this is a network where it is often your friends, it is food, vacations. it is not politics usually for most people. this applies to instagram as well.

this is how they frame this. this is something people have been asking for. we are now giving them that option. people who are critical of the policies might not be appeased. taylor: how upset are the advertisers knowing i can unsubscribe, if you will? kurt: i think they would be more upset if they took away the targeting. the targeting is the secret sauce of social media. not so secret anymore after the amount of money facebook makes. that would be a big deal for advertisers. that would have limited their ability to upload an email list of potential voters and really reach them. i think they will be ok with them because most people are not going to use it. i think most people keep the settings the way that they are when they log in. they don't go and make the effort to go through and personalize them themselves. because this is one of those opt in features, i imagined those people will probably not even use this. taylor: you brought up that ad targeting policy.

we know that is where the real money is. how does facebook compare in that ad targeting policy relative to google and twitter? kurt: google and twitter make changes to political ads specifically. twitter got rid of most political ads. they said if you want to do an issue ad, you have to limit your targeting. state-level, for example. you could not target by zip code. what these companies are doing, they are saying political messages cannot be super tailored to a specific group of people, a specific neighborhood or county. instead, you need to be speaking to a broader group. facebook does not have that right now. in theory, if you are political candidate, you can get targeting with your messaging and some people think that is not a good way to communicate information. taylor: making a pit a little bit to a different story you were covering about fait facebo. zuckerberg saying he is ending his annual personal challenge to focus on facebook.

do we care? kurt: i guess, we wrote it up. these are the things that people and technology have looked forward to. maybe come to expect, not look forward to. he has been really criticized the last couple of years. a a few years ago, his goal was to go to every 50 state. last year, he said he was going to talk to a group of people about the future of technology. he talked to mostly white men. not a very expansive group. this has given people a good reason to criticize mark zuckerberg in recent years. at this point, he should probably focus on facebook. taylor: that is what kurt wagner does. thank you for joining. that does it for this edition of bloomberg technology. bloomberg technology is livestreaming on twitter. check us out. follow our global breaking news network, @quicktake, on twitter. this is bloomberg. ♪

david: the decade that was, what's to come and central banks dwindling. i'm david westin. this is bloomberg wall street week. we will sit down with larry summers. >> share your most intimate secrets with your federal bank. david: national economic council director. >> no question we have done constructive things since 2008. david: and roger ferguson, tiaa ceo. >> retirement is not a crisis. david: and former federal reserve vice chairman. and our special guest, michelle floydfo