i emily chang in san francisco and this is "bloomberg technology." coming up in the next hour, the new dawn of digital ads. presidential campaigns innovating in new ways to reach people across every platform. the problem is every platform has different standards. blame the message or the messenger? plus, in an age where technology makes working from home possible how the coronavirus is impacting the workplace.

and global domination. tesla is one step closer to opening a massive factory in europe winning court approval where it eventually plans to make 500,000 cars a year. u.s. stocks sank friday amidst renewed concerns over the coronavirus. tech companies hit hard. with more, i want to get to taylor riggs in the newsroom. what happened? taylor: the s&p 500 was off about 1%. of thearing the brunt losses, off 2%. apple and alibaba off 3%. investors are pulling their chips off the table heading into the weekend with the nervousness we are seeing about the coronavirus.

teche last five days, clearly the worst performer off about 2% or double what the s&p 500 lost this week. the tech sector losses led by nvidia. they get 1/4 of their revenue from china. i want to put the losses into perspective. losses for chipmakers were off three pointer percent. for the day, 3%. worsthardly one of the days they have had. a bad week, but we have had worse. investors did not want to go into the weekend with a lot of risk assets in the portfolio. emily: thank you. while his democratic rivals are fighting to secure endorsements and delegates, president trump has nailed a coveted election prize, advertising on youtube's homepage. trump's campaign ads will take over the masthead on election

day and in the immediate run-up. think of it as a super bowl ad that will hit a wide swath of people at exactly the right time. we are joined by an advocate and social influencer. how big of a deal is getting the youtube masthead on election day given there are other ad opportunities, but this is a big one. >> this is absolutely a significant development. this is the trump campaign taking advantage of their resources to put money down early to secure very valuable real estate online trade it also demonstrates a way that campaigns are trying more and more to reach people online. broadcast tv and radio are not reaching as many people as in

elections past so they are turning over every rock on the internet to be able to go where the people are. a lot of people are going to be on youtube in the days up to election day. emily: to give you an idea of how competitive this is, president obama bought the youtube's masthead in 2012 before mitt romney even became the republican nominee. the democrats are still battling it out for the nomination. a fairly, no one is thinking that far ahead even though they have been somewhat innovative themselves what does this mean? >> i think you characterized it as super bowl advertising. it is the perfect way to think about it. getting 60 million people tuning in at once, that opportunity is so much harder to do across facebook and twitter and other social channels all at once. emily: michael, let's talk about the other avenues. we have seen the rise of

sponsored content where you have presidential candidates paying social influencers to talk about them. michael bloomberg being one of them. there are other ways to reach seem to becandidates learning and trying new things every day. how does youtube stand out against all these other opportunities? >> that is absolutely right. candidates are trying to innovate online because that is where so many people are spending so many hours of their day. this election, we are seeing ads on youtube, facebook, google. we are also seeing ads within streaming services like hulu were people getting political ads within apps. candidates are leaving no stone unturned. it comes down to how much money they have to experiment and try to do something.

this youtube masthead ad could have been purchased by any candidate or political group. but here, president trump is making a power-play reserving an early while the democrats are still fighting about who the nominee on their side of the hour will be. no other political group came in this early to scoop that up so his campaign has. trump's sat down with campaign manager and 2018. he was talking even back then about the power of youtube, which was sort of ironic given there was this controversy about facebook potentially helping donald trump in the election. listen to what he told me and 2018. watching four hours of facebook this year. that will change. i think youtube and google continues to work on the platform to make improvements. what google has done with the search grew them to put youtube

results at the top, they understand the value of the platform. now more than we did in 2016. the democratic candidates paid attention to that interview, with they would not be in this position. let's talk about the rise of sponsored content, the other innovations we are seeing that giving bigersial and tech big headaches because they do not have -- know how to police it. what is next? >> i think what you saw with the recent instagram sponsored content coming out is interesting because you are messagesed memes and by sponsors. this is the first time a presidential candidate has gone to influencers to leverage their audiences to target the younger demographic. emily: it seems almost obvious. why didn't someone else think of

this? >> for years ago, i feel the candidates were experimenting with it. today, you are looking at people spending $1 million a day on facebook advertising. that is what top advertisers are doing on their own. you are seeing through value -- true value. emily: you are campaigning for campaign-finance reform. have you think this kind of advertising should be policed -- how do you think this kind of advertising should be policed? >> we want to make sure there is transparency when it comes to who is sponsoring as on the internet. onht now if you run an ad radio or television, there is a certain amount of information you as a viewer can see about who sponsored that group. those context clues are important to help people assess the messenger and message they are seeing in ads. right now, the internet is the wild west. the rules for political ads

online are vastly different from the rules for broadcast television and radio. each company right now, whether it is facebook, google, or twitter, they are each setting their own rules about what they want to share with the public about who is running ads, who those ads are targeting, how much those ads cost, and whether you as a general member of the public can even see those ads or whether only people who are micro-targeted are seeing those ads. this is a place where congress could step in and set uniform standards so everyone plays by the same rules and the public can assess the ads. emily: i want to jump in because youtube considered not having any advertising on the masthead on election day and instead putting up a banner encouraging people to vote. today have done that instead -- should they have done that instead? ads in onlineal

spaces are here to stay. we are very much in favor of making sure people are getting informed about voting, making sure candidates are sharing information in a way that there is transparency and accountability. right now, there is no uniform standards for each of these platforms when it comes to disclosing who is sponsoring the ads. and that is where we see the the room for congress or federal election commission in washington, d.c., to step in. emily: well, a story that will continue to evolve as the race for the democratic nomination gets more bloody. thank you both for joining us. coming up, the coronavirus continues to impact the global workers inacting places where the fallout continues.

that is next. this is bloomberg. ♪

sharesaltria group dipped friday after a report in the "wall street journal" said an investigation into the $12.8 billion investment into juul. they are probing whether altria adequately disclosed. they valued the start up at about $38 billion. it has gone down amid new restrictions on juul's business. what do we know? >> we know the sec is investigating whether al

the adequately disclosed risk to investors. the investment has been a headache for altria. it has not been cleared by the ftc. litigation risk is affecting altria. the risk has include about 80% since october. this is just the latest headache for altria. emily: what does this mean for juul? >> it is just another headache. they have been under an immense amount of pressure. this is just another possible product -- problem for them. probes playo these out generally? what do we expect is happening now behind the scenes? >> that is a good question. the "wall street journal" reported both companies have

been sent subpoenas and have responded. how this plays out, we will have to see. emily: we will continue to cover that story. the sec opening a probe into altria's investment into juul. thank you so much for joining us. the number of americans infected by the coronavirus has risen to 34 according to the centers for disease control which says that number is likely to rise. most of those infected are among hundreds of americans evacuated by the u.s. state department from wuhan, china, the epicenter of the outbreak on a cruise ship docked in japan. they are quarantined in four military bases across the united states. it has forced the cancellation of global events. joining us to discuss the impact this is having on companies and the workplaces, brandon morgan morgan, an attorney.

technology has perhaps dampened the impact the virus might have had, enabling people to work from home. some of our colleagues have been able to continue to work from home despite the crisis. what impact are you seeing on work and the workplace? >> thank you very much for having me. first and foremost, this is something businesses and employers are focused on right now. they are talking about what needs to be done stateside to keep their workplaces safe from a prevention perspective and also from an employment policy perspective, what types of policies may need to change given the unique nature of the situation. we are seeing a lot of employers readdressing policies regarding leave and sick days and you are

right. the technological advances have afforded a lot of different types of businesses the ability to do that. a lot of guidance from the cdc speaks to separating employees exhibiting signs of respiratory issues, advising those employees with symptoms to stay home. employers are having to navigate those best practices and balance them with their employment policies. sometimes, you have to flex the policy. emily: there is the point where the outbreak is exploding. everybody sends people home from work. now we are a few weeks into that, and nobody knows if it will get worse before it gets better. workplaces dealing with that kind of uncertainty? >> it is hard. there are not easy answers from a legal perspective or from any perspective.

the thing we counsel employers is toat the outset communicate with your workforce, number one. and number two, have an actual plan in place. companies should get the ,takeholders together upper-level management, they need to review the osha guidelines and the cdc guidelines and formulate a plan for how they will keep their workplace safe, how they will train employees, and deal with the hysteria and fear which is understandable. it is a scary thing. it is so widely reported. it is something a lot of employees are expressing concern about. the key for employers is to communicate with your workforce, listen to them. if your workforce is expressing concerns, fears, listening and addressing and adapting to what

your employees have to say. the bottom line is communicate and let the employees know that you are doing things to keep them safe. emily: thank you for communicating that with us. brendan horgan of eckert seamans, thank you for joining us. coming up, is it 1999 all over again? we will talk about why big tech may not be the reason markets have been overheated. "bloomberg technology" is live streaming on twitter. be sure to follow quicktake on twitter. this is bloomberg. ♪

emily: the u.s. justice department has tapped an outside law firm to help with the antitrust investigation of tech

giants from facebook to google. it is a sign the government may be preparing a lawsuit against one or more of the companies. david, what does this mean? turnedjustice department to a law firm based in d.c., approached them about working on this investigation of the tech companies. that firm had a conflict, according to the people we spoke with, so they could not do it. it is not clear whether d.o.j. is talking to other firms. the approach to an outside firm is pretty significant and signals that potentially d.o.j. is getting ready to go to court because in some past antitrust fights, most notably in microsoft 20 years ago which was a huge antitrust case, they who is an outside lawyer

quite famous. is that to say this is very unusual? >> in is pretty unusual. microsoft is one example. they did it in a merger case about 10 years ago. that was at&t's -- the department of justice's case against at&t when a treaty -- at&t tried to buy t-mobile. when the justice department or ftc brings cases to stop mergers, they use their own law firms. notableosoft case was bo when d.o.j. hired david ise. in general, they use their own lawyers. they may turn to other law firms when they need additional resources which could be the

case here. emily: the firm they spoke to, call-up-hanson, -- kellogg-hanson, does that give us any clues as to what kind of help the d.o.j. needs? >> that firm is generally known for its work on litigation matters. they are not a huge firm. they are not huge firm that might be as well-known in legal circles. it is the firmware supreme court justice neil gorsuch first work before he was nominated to the supreme court. we don't know whether the justice department has talked to other law firms about doing this work. i think a little more work needs to be done to find out exactly what this means. emily: give us the latest on the investigation. attorney general barr said this

investigation would move very quickly. do we know how quickly, how soon could we see some actual action here? >> he talked in december about getting this done sometime this lift which would be a big because this is potentially a very sprawling investigation. we know the justice department is looking at google and facebook, potentially other companies. in the google case, based on our reporting reporting by other news organizations, the justice department is bearing down on google's digital advertising business, which is very complicated. we don't know as much about the facebook investigation. getting it done in a year according to some lawyers is hasty ambitious, but barr expressed support for not having this draghi out for a very long time -- drag out for a very long

time. meanwhile, you have a lot of states investigating both companies. as i came on the air today, there was news the texas attorney general reached a settlement with google about texas' use of these consultants that google has opposed. that case is also advancing. emily: interesting. lots of competing probes. the d.o.j., the ftc, the states. a lot for you to keep us apprised of. thank you for joining us. , a social app sensation. we are talked about the next facebook for years. that may be increasingly unlikely. that conversation is ahead. this is bloomberg. ♪

emily: this is "bloomberg technology." i am emily chang in san francisco. including microsoft have earned their returns by outperforming expectations the last five years. what can they keep the momentum going, and if not, what does that mean for the next five years? let's do a deep dive on this very question. first of all, let's talk about the last five years. obviously, big tech has been on a roll. why? >> if you look at the multiple evaluation, it always looks five it but we believe multiples

don't tell the whole story . interestingly, the expectation was for amazon to deliver about $22 billion in ebitda. in reality they are on track to deliver $50 billion. same we are seeing across microsoft. did we're seeing is why outperformance happen? it happened because we underestimated aws, what the logistics program can do, things like that. from that point of view, from that lens, they have earned their outperformance in the stoxstocks as well. emily: have we then, the proverbial we, learned our lesson, or will we continued to overestimate the performance the next five years? jitendra: quick question.

if-the reality is better--great question. if the reality is better than perception, the stoxx will their high valuation. growth -- 17% growth expectation for profit. i think the advertising segment is not baked in here. google is going to be youtube and cloud, and surprisingly facebook is bottom of the list. expectations are 12 to 13% growth. regulations have weighed on expectations. if they diversify into more into. diversify awa content, they could have outperformance there. "diversification" will be the were to watch the next five years. emily: we're talking about six different committees, although we lump them all into the bang

acronym. which is most a t risk of not outperforming expectations? jitendra: that is a good question. near-term there is risk for all of them. all of the uncertainty around ise coronavirus impact, it not captured in expectations yet. longer term, if you look at amazon, amazon's expectations are the highest. they can deliver on the 17% to 1 8% expectation. outperforming them significantly, as they did the last five years, that is going to be challenging. advertising can help marginal outperformance, but the aws division draws the five-year outperformance moving forward. they have to compete in this market. they grow at a healthy clip, but the surprise is that the reality is better than perception will have to come from advertising.

emily: great research there. thank you so much for that analysis. countless social-media startups since the dawn of facebook have struggled with short-lived popularity. vine, and was, recently hq trivia. hq trivia shut down almost as quickly as they went viral. although we are always talking about the potential demise of facebook, no company, it seems, can become the next facebook. i feel like every year we are talking about what could be the next facebook, but the questions have become increasingly rare. facebook is not going away. it doesn't seem to be going anywhere, despite struggles. why is that? >> facebook has become almost infrastructure in our society now. we use it to plan events, we

use it for groups. the company keeps trying to reinvent itself, but people keep going back to the original core purpose, to have it be the phone pic for everyone they know. -- phone book for everyone they know. that will change generationally. there are apps for those who don't consider facebook to be a key part of their social lives. maybe they have to join a facebook group for their language class in school or soccer team, but they don't necessarily need it for their friends. once that starts happening and that continues to go up, we might see a change in behavior. but they might move onto companies also owned by facebook like instagram and whatsapp. hqly: let's talk about trivia in particular, a company it is shutting down almost as quickly as it was the hot new thing. in this particular instance, what went wrong?

sarah: there was a lot of managerial strife in the company, a lot of bad decisions about how to scale. a a lot of times what we have seen is the people competing with facebook, not just that they are competing for consumers in the market, they are competing against facebook's operational efficiency and the strength in the market and their ability to keep growing. we saw that with snapchat. that company had a lot of organizational problems at the top, and the redesign didn't go over well. they almost shot themselves in the foot more than facebook did, given the facebook is constantly trying to take them down. now they seem to have recovered from that, but not everyone does. emily: if you could put your money on it, in a decade, will there or will there not be a next facebook? sarah: i think there will be something, because our communication is becoming more

visual. i don't think facebook has been that good at it. we have seen tiktok catch on like wildfire in the united states. whether that will go the way of vine remains to be seen. there is potential, but we don't know who will do it right now. emily: sarah frier, thank you so much. fascinating question to always ponder. two legacy tech giants battling it out. onpulling out all the stops xerox's takeover bid. hp says it would encourage any other potential buyers to negotiate with the board. to discuss from we are joined by someone who has been taking a closer look at this. >> this is basically a poison pill for this deal. every situation over the last decade in which you have seen a company try to take over another one with some hostile means, particularly a tender offer, you

have seen a poison pill. this situation, should a company of to buy 3% o-- 20% or more wouldl the holders of hp have the right to a special class of stock that would give them the same voting power and same dividend rights as one regular common share. it expands the pool of shares and even if someone is able to accumulate 20% or even a majority. emily: let's talk about the players here. you have hp and xerox and carl icahn, the largest shareholder in xerox, and has been pushing this. what strings is he pulling behind the scenes? nico: hp has alleged for a good amount of time in this process that i thought the entire thing was being driven by carl icahn, who as you said is the largest shareholder and has strong ties to the rest of xerox board, as

well as xerox management. the ceo of a xerox used to work for carl icahn. carl icahn says that xerox has been pushing the process. the is in favor of a deal, but he told bloomberg yesterday that he would like to see any deal in which it is iraq's buys it-- ysther xerox buys hp or hp bu xerox. he is agnostic on that front, so long as the management team of xerox is in charge. he feels like hp is doing small things around the margins that are not going to help the company in the long-term. emily: at this point, given the competitive landscape, why might a merger or takeover make sense or not make sense? nico: so you have a situation in which people are just printing less documents and that they used to. in offices, obviously xerox's

bread-and-butter, you still have a good deal of printing. but from a consumer standpoint, where hp is stronger, you have seen a secular decline there doesn't seem to be going away. the idea is to come together to have economies of scale that would allow a combined company to reduce costs, reduce their supply chain, cut the number of employees in duplicate roles. xerox says there would be $2 billion of synergy. the question is whether a combined company would be able to grow. even if this was one combined company, you still have the same competitive dynamics taking place in the printing market, because canon, epson, and a whole host of other major companies are still out there. emily: bloomberg tech's nico gr ant, i know you will keep us posted. coming up, move over, e-commerce.

enter 3-d commerce. this is bloomberg. ♪

emily: imagine if you could try on a pair of nikes or an expensive necklace before buying it online. wouldn't that be nice? an l.a.-based the start of is trying to make that a reality, a mixed reality. it has 3-d shopping experiences. the goal is to give shoppers more certainty or uncertainty about their purchases. actually, we have all bought a pair of shoes online and then regretted it when they arrived. how exactly could your

technology change that equation? >> that's exactly the problem, and we have seen that 3-d assets give customers a better understanding of the product. actually being able to see the product in 3-d and even do a virtual try-on with augmented reality has proven to not only double conversion rates but significantly reduce return, saving company's time and money couldv it has been really expensive and time-consuming to create these types assets. create a robust content online to reduce the time by about 80%, helping companies save time and money and creating an disturbing these 3-d assets. emily: making it look better online is one thing. actually being able to virtually try on a shoe is a ways off, isn't it? ashley: it's not. it is actually here today with the advent of all the new phones

coming out this year. most people watching watched the apple news release last year, which talked about the multiple cameras on the phone. that is all to do better tracking to do augmented reality try-on. if you look at warby parker, you can virtually try on a few glasses. it is one thing to do it for one or five products. it is another to do it for 25,000. if you look at companies like adidas and a nike, they launch 25,000 products a year. our software helps them do this at scale. microsoft,as, nike, these are your customers. give us some specific examples of how the technology is helping them. example is a client we work with that has over 4000 jewelry products. there is no way they could hire 3-d artists to re-create all

4000. they use our software to digitize their entire line and a 3-d assets across the web augmented in virtual reality. another example, we started a company with a turnkey hologram solutions with our best in class technology, and companies would cad filen 800-megabyte for the product. it is too big to put on your website, too big to put on a phone. that would take weeks of a 3-d artists's time to strip it down and make it usable. our software can do that in a few minutes. emily: the goal is to straddle the online and physical world. let's talk about the hologram -- again, something that for many, many years seemed futuristic. but as you say, may be closer than ever, if not here in some places. talk to us about how your technology works. ashley: right, so when we

started the company, the phones were incapable -- there weren't headsets on the market. create hologram services holograms and we created the content. brands want to leverage celebrity endorsement deals and show off their products. it was when we got to these products, every client from lexus to adidas, no one had the proper 3-d assets. that is where we saw the area to innovate and help automate with software. that is what we are excited about now that we have all of these other platforms that require these 3-d assets. we are helping people create and distribute those assets at scale. emily: fascinating stuff for someone who likes to shop. thank you so much for joining us. still ahead, road cleared for tesla. the company gets the go-ahead to clear a forest in germany for its new factory.

we have all the details ahead. this is bloomberg. ♪

emily: tesla had gotten the go-ahead to clear a forest in germany, where it plans to build a massive factory. a berlin court has overturned an injunction that temporarily blocked the project. joining us to discuss is ed ludlow. good news for tesla. why is it so important for them to get this factory up and running? ed: tesla's ambition is to build vehicles where the customers are. tesla produced 360,000 cars last year, but those cars, someone to china, some to the european union, some to other markets.

this is something that elon musk talked about in the last earnings call competitive simply silly to build all the cars in fremont and ship them all over the world when they could be building them where the customers are. it makes them regulat ory-compliant in those areas. they have the shanghai factory come the second-biggest market behind the u.s. europe is growing, with 70% revenue growth in china, 60% revenue growth in the netherlands and norway and germany. they want to streamline the production process where the customers actually are. emily: and the goal is to produce, what, half a million cars? ed: the aim this year's 500,000, which seems like a big jump from the 60,000. emily: we would expect no less from elon musk. ed: another way of looking at it is 98% of all the cars on the world still have combustion engines.

it is hard to tell what tesla's growth is, because it dominates a lot of the ev market around the world. that is their ambition for this year, 500,000. how quickly can they go to the german factory? it doesn't look like that is as fast or possible in germany and they are dealing with the effects of coronavirus. emily: let's talk about what is happening with the shanghai factory, because obviously we have the coronavirus and that has had a big impact on apple. u.s.-china trade tensions are still lingering. how successful has the china factory eckley been for tesla-- actually been for tesla? ed: they were just running to produce and were in the stage of rantinramping up. they were open in the last earnings call that it would set them back by one, one and a half weeks. but we actually don't know what the impact is to their supply chain or how many vehicles they

are producing. it ise do know is that getting out there and visiting the sales floor -- 92% in the first two weeks of her work. even if they had production capabilities--first two weeks of february. even if they have production can the police up and running,-- emily: ed ludlow, thank you for that update. speaking of ev's, ev is on the brink of change. as special is on bloomberg television tonight. it explores the future of electric cars and the challenges facing consumers and carmakers alike. ,ere's a taste with alix steel who spoke about coming together to make it with ev's. alix: electric vehicles, a car that runs on batteries.

they work in lots of different ways. here is one of them did take a tesla. ionse the batteries, tiny of lithium move through an object called the cathode to the annode. it is made up of nickel, cobalt, lithium, and aluminum. it generates the flow of electrons, or electricity. these batteries pack a serious punch. have a large charge and discharge rate, so they produce a lot of energy and you can reuse them a lot. to prevent the batteries from overheating, an ev uses cool liquid that flows between the batteries. then an inverter takes the power and changes it to an alternating current. think of it as a full-page that changes. from there,-- voltage that changes. from there, a rotating field within the motor, and voila, you have power. yoany electricity that isn't used, like if you slam on your brakes, is sent back to the

battery pack. the $36,000 chevy full goes 238 miles on a charge. the tesla model s can go 315 miles. after that you have to charge you -- 30 minutes at a station come almost a full day if you plug it in at your home. the battery is low and flat on the bottom of your think of it like a skateboard. the lower center of gravity helps your driving. does it work? the average cost of gasoline is $2.65 a gallon. e-gallon.an electric prices do very,, and the more miles to go, the more expensive the car in the. but the hype is hot, personalities are big, cars are sleek. is it worth it? emily: you can tune into that special tonight at 9:00 p.m. eastern time. that does it for this edition of "bloomberg technology." we are live-streaming on

twitter. you can tune into our global breaking news network quick take on twitter. have a wonderful weekend, everybody. it is friday, great being back. i will see you back on monday. this is bloomberg. ♪

>> there about his supply chain and tech faces a government shutdown. this is wall street week. welcome back. a last hurrah of for the central bank. inflation for a variety of reasons has been a no-show. >> we will see a much bigger variation between companies in >> the same sector. >>what we are looking for is the way that it affects the customer today. it is a customer driven revolution. possibly, china is a form of diversification. there will likely be a decoupling between the united states andhi