from the heart of where business, power and industry collide, this is "bloomberg technology with emily chang. >> from the heart of where business, power and industry collide, this is "bloomberg technology with emily chang. >> from the heart of our >> facebook shares plunge and the postal -- social a massive . after the whistleblower reveals -- herself. her name is frances haugen and

she is a former product manager at the social network. her claim is that facebook prioritizes profits over the well-being of its users. is it related? we discussed. regulation is necessary for the citadel ceo to consider trading cryptocurrency. in a conversation, he praises the sec chair for taking a closer look. plus, what he has to say about payment for order flow. the foundation of citadel's relationship with robinhood later this hour. and, the wait for the new apple watch is over. a release date has been set after the company was hit with a delight due to supply chain issues. we will have all the details. all of that in a moment, but first u.s. stocks started the week with a big plans. facebook with some added drama. let's get to ed ludlow for the full picture. lots to get through here. ed: the big story is facebook, biggest decline on the nasdaq,

the stock trading at its lowest level since june. the whistleblower comes out and says the company prioritizes profits over safety, then you have outages. it is resonating throughout social media stocks including twitter, pinterest, snap. it's interesting those stocks tend to be more volatile. in terms of how that manifested in the broader markets, especially equity markets, the s&p 500 down by more than 1%. the nasdaq 100 very tech heavy, down 2%. that is true of big caps high-growth tech stocks, the bank index which includes amazon and tesla as well as semiconductors. we are seeing investors take money out of tech stocks and put them into energy stocks as we see commodities rise, you see the spread between the s&p energy and s&p tech sector. the green bars on the far right-hand side, you can see

energy has outperformed and we expect that to continue with this risk off sentiment. i want to touch on the bloomberg crypto index. you see broadly crypto higher on monday, continuing what we saw on friday. bank of america has just initiated the research arm of its business about crypto which says it is based on growing institutional investor interest, that is a bullish signal we are seeing in the market and continue to see crypto make gains. emily: thank you for that roundup. i want to stick with facebook in the eye of the tech storm. a whistleblower revealed her identity and accuse the social network of putting profits before people, and her first public interview with cbs's 60 minutes. >> someone else might have quit and moved on. >> imagine that you know what is going on inside and no one on the outside knows. i knew what my future look like

if i continue to stay inside facebook, which is person after person's has tackle this inside of facebook and granted grou -- ground themselves to the ground. emily: she says she passed thousands of internal documents onto lawmakers in the wall street journal because of harm she believes facebook is causing the world. this, on the same day facebook, instagram and whatsapp were experiencing outages for hours. joining us now to dig deeper, naomi, this outage has gone on for a fairly long time. do we know if it has any relationship or is this a bad coincidence? naomi we do not have any -- naomi: we do not have any evidence: of that quite yet. a bad coincidence indeed, poor timing. given how much facebook is in hot water right now. emily: let's talk about the hot water.

what did you find to be the most alarming take away from this interview with francis? this is a woman who has worked in tech for a long time. she says what she has seen inside of facebook is far worse than anything she has seen anywhere else. naomi: i think one of the overarching points that she made is facebook, time and time again make decisions that prioritize profit over people. over protecting democracy, over the well-being of its users. that she did not think the company could make change from within, that they had to be forced to change from outside authorities, congress or washington. emily: facebook, in their statement today, released a statement talking about multiple misleading facts, things that were left out of the interview. they say every our teams have to balance protecting the rights of billions of people to express themselves openly, with the need

to keep our platform a safe and positive place. we continue to make significant improvements. to suggest we encourage bad content and do nothing is not true. it seems like facebook's intentions, whether they have changed the algorithm to focus on more divisive, more anger, more emotional content, is really at issue. what have you been able to glean from this whistleblowers revelations about whether or not facebook does have bad intentions? naomi: i think it is less about the intentions of facebook, but the essential structure of the

platform itself. one of the points that she made last night, these algorithms powering the social networks, they are designed to get you engaged. they are designed to make you insight emotion. what is the kind of content they get to engaged? polarizing, makes you angry. what is the ripple effect of that kind of innate structure of a social media network? she is saying it will affect polarization, it will affect how political parties advertise on facebook. it's going to affect what kind of content gets rewarded. that might not be the same thing as the kind of content that is more productive for institutions. emily: we will be testifying before congress tuesday, following your coverage and bring you updates on bloomberg technology. thank you so much. i want to continue this conversation with someone who has pushed for change at facebook for many years. was there anything in particular

about this interview with the whistleblower that is more alarming to you, it more shocking perhaps than even you thought about issues going on within the company? guest: i think this entire whistleblower situation is just the next episode in a controversy that has been in plain sight for years. we have known the damage facebook has been causing, but to me it was the courage of the whistleblower to come forward and reveal the company fully understood what it was doing and chose to ignore those actions. i think that is where you see a breakdown in how the company is run, the governance of the company, and the fact that they have the singular focus on

attracting as many eyeballs as possible. because of that, they are blind to the bigger picture that the platform is in fact hurting people. emily: let's take a listen to a little bit more of that 60 minutes interview, in particular this idea that facebook is optimizing for engagement and not for safety. frances: one of the consequences is it is optimizing for content that gets engagement, every action, but its own research is showing content that is hateful, divisive, polarizing, it's easier to inspire people to anger and other emotions. >> misinformation, angry content is enticing to people and keep them on the platform. frances: yes. facebook has realized that if they change the algorithm to be

safer, people will spend less time on the site, click on less ads, they will make less money. emily: this is the very foundation of facebook's business model. what can and should be done? natasha: i think it is about a control of mind share. if you look at what is happening in tandem with the facebook files, the whistleblower, what is happening at the ftc, in congress, there are these questions of what constitutes an antitrust violation, and what is this line between a safe product and unsafe product, consumer protection. we know facebook has a dominant position, is at stifling competition? one could probably argue yes, they by their competitors fairly easily.

the next question we are examining is, do they have control of mind share? if you look at the 3 billion users across their platforms, the ftc is now citing 92% of people's time overall is spent on facebook. that is remarkable. this question becomes, does that control of mind share hurt consumers? i think the whistleblowers, the wall street journal expose shows a straight-line between the content algorithms, what they serve up the most, the most provocative content, a straight-line between that and real-world harm. emily: facebook shares are down today. to be fair there is a broader tech selloff, facebook shares are down a bit more than the broader tech market, unclear if

that is directly because of the whistleblower, because of the outage or something else. how does facebook make good on this? as a shareholder, you are calling for facebook to compensate investors somehow. how and why? natasha: the fact is, the gulf between facebook's words and actions could not be any wider. you saw that last week with congressional testimony on instagram's impact on kids, you have investors being concerned about what facebook new and has done. the company has simply not done enough to address the damage inflicted on society, whether that is teenagers, marginalized groups, geopolitical stability. something needs to happen.

even as investors we have not gotten straight answers. december of 2016, we asked the company for a report on this information and election interference. we were told by facebook there was nothing to worry about. it took facebook executives getting dragged before congress to acknowledge there was a problem, apologize, and did they really take the steps to fix the problem? i don't know if that is true. here we are now, watching this next episode of the controversy in plain sight, and the question becomes, is congress going to do anything about it? is the ftc going to do anything about it? or are we all going to sit back with ever looks of outrage. the well intentions of lawmakers -- our looks of outraged and make fun of the older well

intentioned law makers who fumble their words around big tech and let the status quo stand. emily: right. natasha: most recently, with the cambridge analytical scandal, we saw the ft settlement was potentially billions of dollars above what needed to be paid at the time to protect zuckerberg personally. i think there is a clear issue between the fact zuckerberg owns 14% of the company and investors on 86% of the company. emily: speaking of facebook, facebook filed a motion to dismiss the ftc second antitrust suit against the company. this just out from down detector following the facebook outage, which is still going on, down detector saying this outage is the largest outage it has ever seen. we're going to continue to follow that and see how that plays out. always good to have you here.

thank you. captain kirk from the 1960's tv series star trek is going into space. blue origins william shatner will fly on board new shepard on october 12. the flight follows blue origin's first successful human flight in july, which included jeff bezos. shatner is 90 and will be the oldest person ever to fly in space. coming up. a release date has finally been set for the new apple watch. how supply chain issues may impact production for apple and your holiday shopping. next. this is bloomberg. ♪

emily: apple set a release date for the its smartwatch, a sign is working out production challenges. the company plans to begin taking orders this friday. i want to bring in mark gurman. what do you know? mark: october 8 is when preorders begin. anyone who is dying to get one, probably the best way to get it is through the apple store app. supplies going to be low given that they recently started production. october 15 they will start delivering and hitting stores. that will vary on the configuration. aluminum, steel, titanium versions. they have problems related to

the display and the new display cover glass and manufacturing engineering revolving this ring. obviously, this is the screen size increase in the products history. this is the strangest apple watch launch i have ever seen. they announced it only three weeks ago, said it will be released later this fall. they could have said we are releasing it next month if they knew that was the case. i think they wanted to gather enough supply. emily: are the supply chain issues impacting any other apple products and will it impact availability into the holiday season? mark: you bet. they put a lot of eggs in the basket to get iphone units out there. if you go to the website and order certain models, the 13 backs or 13 pro, you are seeing ship dates into early november. my senses that will start to cool down by late november, but people are already doing holiday shopping. the other thing to keep in mind is the mac. apple was supposed to come out with macbook pros six months ago, now they are gearing up to

announce them as early as this month. you see some capacity issues. they have been allocating capacity to the phone. what is the next most important product? obviously the apple watch is up there with the phone. you will see the mac, the airpods. this is what happens when you're in a supply chain situation, you have to make choices. their choice was to go alone on the iphone. it is starting to loosen up. emily: ok. mark gurman, thank you for bringing us all of the sales. coming up, south korea's battle against big tech. lawmakers get set to crackdown, blaming them for a socioeconomic divide across the country. we will have details on that, next. this is bloomberg. ♪

emily: korean lawmakers have kicked off a parliamentary hearing into the country's internet giants. companies are accused of abusing their position and squeezing small businesses. south korea's crackdown on big tech a similar to this for me on family-run conglomerates. i want to bring in shery ahn. what can we expect? shery: we are going to see five weeks of grilling of these big tech giants in their ceos. we are talking about a busy night tonight in korea, the national policy committee will be talking to the heads of the

companies. the committee will be handling google korea, apple korea, facebook among others. one lawmaker dubbing kakao a symbol of greed. they are echoing public sentiment, blaming them for widening the socioeconomic gap because they have been expanding into areas that were previously dominated by small businesses. we are talking about food, taxis, delivery services. we have seen the growing scrutiny. one company was fined in august $3 million for what regulators are calling unfair trade practices. as you say, this is reminiscent of what happened five years ago in south korea when regulators were going after family-run conglomerates. not much came out of those attacks, but they happened just

before a presidential race and this seems to be also geared towards the march presidential election. emily: what kind of changes can we expect? can this go as far as china's tech crackdown? shery: that has been the fear, the reason we see downside for these korean stocks. kakao has lost 30%, another has lost 50%. that has been the fear. are we going to see the changes in the landscape? we have already seen some responses coming from the likes of kakao, they announced they would be exiting some strategic businesses including hairdressing. they have pledged $250 million to help small margins. we have seen efforts coming separately from the korea fair trade commission in order to go after these big tech giants including protecting consumers and merchants with existing laws, also trying to enact new

regulations. interestingly, the chair was talking to bloomberg saying we're only going to see minimum regulations. take a listen. >> our top priority in our enforcement is to increase competition, and also increase activity in the market. i would say to market players and investors, trust us, we are here to help you. shery: she took the helm in 2019, pledging to form a digital, fair economy. emily: we will keep following what is happening across the tech landscape. thank you so much. coming up, the maker of electric cars backed by amazon and ford has filed for an ipo, but this a $1 billion net loss in the process. we take a look at what the ceo had to say. this is bloomberg. ♪

welcome back to "bloomberg technology". i and emily chang in san francisco. bloomberg reported in august the company this evening and $80 billion valuation and now with a look under the hood, we know even more about the truck maker.

joining us to discuss, the man who broke that story, ed ludlow. ed: this is a fascinating look under the hood. the $1 billion net loss in the first half of this year is the eye-catching thing, but we know rivian has been hiring like crazy. they have been desperately sprinting to start production, bring in machinery. we know it has around 48,000 reservations for both its pickup truck and suv. maybe we were expecting more. this is a fascinating look at a company with an eye watering valuation, by comparison, ford has 150,000 reservations. demand is not what we thought, but a lot learned. emily: a lot of excitement around rivian is tied to amazon. what do we know about the relationship between the two

companies? ed: amazon has excellent civic. in other words, rivian can only sell for a period of four years. amazon also has the first right of refusal on all of the vans rivian builds. according to the contract, amazon does not have to buy any at all. the ball is in their court. it is weighted heavily in amazon's favor. because he reported, the $80 billion valuation, a big part of that is because amazon is a big investor, not just a customer. emily: ed, thanks so much. moving on to intuit. the company response of our guiding millions through the tax process, supporting small businesses and helping individuals manage their money,

recently announced a $12 billion acquisition of -- since then, the company has launched its venture arm with a focus on startups they can help small businesses and consumers. for more on the latest strides in protections for the remainder of the year, i am joined by intuit ceo. great to have you with us. i'm going to start with the huge deal on the back of your big buy of credit karma. how does this played into your overall strategy to expand? guest: thank you so much for having me. we are very excited. one of the goals we have set for the company if we want to improve the success rate of small businesses by more than 10 points versus industry. the industry benchmark is 50% of small businesses go out of business after five years. one, the small businesses we serve site getting customers as their number one issue. the second is cash flow, getting paid. manage inventory, paying employees. that is a lot of what we can do

with quickbooks. what exciting is combining. now in one place, you can take your business online. you can market your business with marketing automation tools. and also manager customers through crm tools. when you combine that with capabilities we have with quickbooks, which is all around managing your money and ensuring your books are right, we can now have a platform that powers prosperity of small businesses. frankly, the real magic that we are very excited about is we put the power of data in our customers hands. they will have customer data and purchase data so they can understand who is bought from them, what they bought from them, opportunities to market that to their customers. that is an exciting opportunity. emily: you launched a new venture arm to invest in emerging financial technology,

on the list is crypto. i'm curious how much you think crypto will play into the future of intuit's business, and how excited you are about these emerging but unproven trends. sasan: first of all, we love emerging and unproven trends because some will work out, someone not. it's important to intentionally place your bets on the future. it gives us the opportunity to pick great talent. we believe crypto and blockchain will play an important role, however making sure everything we do is about making customers

manage their cash flow and be able to feel success, but they are going to play an important role. emily: speaking of empowering individuals, there have been reports that employees were not happy because they were told the company was never going to sell, not given the same kind of equity that typical startups give out in silicon valley. how are you responding to this? cap you thought about any to resolve this? sasan: we have. one of the things where excited about is mailchimp employees just like all intuit employees can participate in our equity plan. as they do amazing work, they are able to participate. that is first and foremost. second of all, we put several hundred million dollars to the side for employees so on close, they can benefit from equity and receive equity over time just as any other intuit employee. we are very excited about that, it gives us an opportunity to

engage in ways that will unleash potential. emily: we have seen an increasing outcry over wealthy people not paying taxes. you have so many regular people, i'm curious what your thoughts are on this. is there a role for technology to play in leveling the playing field, have you been involved in any conversations with regulators about the tax code? sasan: we have believed in this simplification of the tax code, reduces the complication. we believe technology plays an important role of taking the tax code and making it easy for consumers and small businesses to be able to do their taxes. it is the governments job to ensure everyone is abiding by tax laws, people are doing their taxes. but we do is enable it to our platform.

we work closely with the irs to ensure it is very easy for everyone that taxes are done right, and they get the biggest refund possible. emily: the intuit ceo, thank you for sharing all of that with us. appreciate you stopping by. meantime, the citadel founder ken griffin says the federal reserve has a no-win job with fiscal stimulus undermining the work the fed is doing. p also said when the fed characterizes current inflation as transitory, it is a big bet. in an interview, he also said he would trade crypto if it was regulated. take a listen. >> we don't trade crypto because of the regulatory uncertainty. we often make markets in companies whose business models i don't have fondness more, because one of our jobs as a market maker is to meet the

quitter demands of american families that want to invest. prickly, it is not my job to tell them if they are right and wrong, it's my job to provide them with the best possible price. because of a lack of regulatory -- we are not involved today. i believe that the chairperson is spot on on the need to have thoughtful regulation around cryptocurrency. i think doing so will make it a smaller market, because it will be a more competitive market when there is regulatory clarity. it will become very different in a world of competitive exchanges and pricing by tier one market makers going to put their best foot forward. i believe the chairperson is

spot on, and the sec has a solid history of creating good redness for policy. to be clear -- i would trade it because it would meet the needs of our online brokerage partners who want to have a tier one firm making prices. part of the reason we are so significant in retail market making is our high reliability where every minute of every day we provide a great service. they want us to provide pricing in crypto. i just want to take on the regulatory risk that some of my contemporaries are willing to take on. emily: griffin is back in the spotlight after retail investors filed a class action lawsuit claiming citidel, robinhood and others colluded in the meme stock frenzy in january. robinhood uses citadel to

execute its trades. the sec chair has indicated the regulatory -- griffin says it doesn't matter. >> order flow is a cost. if you are going to tell me by regulatory fiat that one of my major items of expense disappears, i am with that. emily: coming up. a concept that has been tried again and again with positive results, so why isn't it catching on? we speaking to the latest tech unicorn. that is next. this is bloomberg. ♪

emily: the pandemic led many employers to offer more flex ability. one fintech unicorn is taking that a step further. it is running a test of a four-day workweek to gauge productivity and wellness levels, and this could eventually turn into a permanent solution. with me now is the ceo of bolt. great to have you with us. most workers thanks this sounds like a great idea, curious why you think so and how the company decided to do this. guest: it is a pleasure to be

here. we have been known for pushing the envelope on culture, conscious culture, how you bridge execution with humanity. we found smaller companies implementing a four-day workweek, we headed on our docket to discuss how it might fit in to bolt. we firmly believe in action, and b cannot think of a reason why this would not work. it was kind of a no-brainer, so we decided to move forward. emily: why aren't you worried about productivity? workers taking advantage of this with extra long weekends? guest: because we have learned that the more rested your employees are, the better they feel, the more present and engage they are, the better work they do. we are seeing an end to the old-school mentality. for us, we want employees who

are focused on results. they can focus on results when they are present, engaged. we realized a four-day workweek, you're coming in and working hard with three days off is the better route. emily: what have you learned so far since the new policy has been in progress? what data are gathering? ryan: it's a three-month test. we are measuring two simple things. productivity and employee happiness. that is really all that matters in the workplace, some people get confused. both of those things are pointing towards incredible success. our employees are just as productive if not more productive, we have seen skyhigh scores. the team, the energy is electric.

people love this approach. ultimately, not only will this lead to higher productivity, but retention, engagement, we expect to see others follow suit. emily: what is the likelihood this becomes permanent? sounds like you are close to saying so. ryan: i consider it very likely. we have an operating value, we go after big things. we do not like to think about it going wrong, we are ok if it does, but not focus on that. we are focused on success. this is entirely focused on success, and it is hard to see anything that is going to get in the way of this experiment. emily: we will have to check in with you in three months. the ceo of bolt. thank you for joining us. offer prices listed as $100 million, that is normally a placeholder subject to change.

to bring you more details as they come. coming up, look into the future. amazon thinks he will have robots running around our homes. mark gurman shares his thoughts on the tech giants new devices. meantime, sony's new film venom secures a top spot in the box office taking $90.1 million over the weekend. the sequel generated the highest opening weekend box office of the pandemic. cinemas continue to look positive with the new james bond film opening in the u.s. later this week. this is bloomberg. ♪

mark: amazon is trying to launch the future too early. the company has announced a slew of products including a thermostat, fitness band with a screen. it was the other announcements that made consumers feel like the jetsons. a 1500 dollar astro home robot, a drone, and wall echo. for many people, the robot is a nonstarter. i can't imagine users want it to follow them around. the touchscreen that doubles will be in each product. the drone is scary for some, but i personally want one.

likewise, the echo is futuristic. i think the idea of having a giant screen mounted onto the wall is cool, and a great way to have a home command center. i think we are years away from the robot. the question surrounding want to products to early could be a reason why apple, google and others have shied away. amazon deserves credit for trying to usher in the future when others are not. i am mark gurman. this is power on. emily: you can sign up for the weekly newsletter at bloomberg.com. tinder is rolling out a virtual currency as an incentive for users to spend more time on the app. the future will be available in australia and it is the latest effort to move beyond its traditional swipe right havoc. -- habit.

for more, i want to bring in michael. reporter: this is an interesting new feature where users will get virtual coins in exchange for keeping their profiles up to date and doing the normal swiping app. it's rewarding behavior that users are doing anyway. emily: will this actually succeed in the longer-term objective to get more engagement on the platforms to expand the universe of behaviors on tender -- tinder beyond swiping? michael: i think so. on the earnings call, there was good commentary about how tinder users' propensity to pay has gone up. it grew by 26% for direct revenue year-over-year in the second quarter. the a la cart which are your super likes and boost and other features that give you more exposure to potential matches are where the company is seeing strong revenue growth.

giving users a taste of what these features do will incentivize that behavior to pay going far. emily: tinder is also saying the goal is to make the experience more immersive. do they think dating is going to dramatically change in the future? is tinder trying to move us into the meta-verse? michael: that reminds me of when brian was on your show talking about the future of travel with airbnb. i think that every company is figuring out what the future is going to look like. i think tinder and match group which is the parent company is looking towards the future to roll in these features, whether it is audio, video or ai. in the second quarter they closed an acquisition of hyper connect, a south korean company. i think we will be seeing more of that in the future as they pivot more towards video.

emily: it's an australian now. i was expecting it to expand beyond it? michael: they did some tests in smaller markets and decided to start in australia, it gives what the company said a representative you of global -- view of global consumers. we will see what happens in australia. emily: michael tobin, thank you for that story. meantime, an update on our top story. facebook suffering an outage. shutting out many of its 2.7 billion global users. it is affecting the family of social media apps including the main social network, instagram and whatsapp. down detector says the outage is the largest it has ever seen. the cause of the problem has not been shared, the chief technology officer has issued a public apology. a former employee turned whistleblower appeared on 60 minutes, accusing the company of prioritizing profits over user safety. she will testify before a senate subcommittee on tuesday.

that does it for this edition of "bloomberg technology." join us tomorrow. i am emily chang in san francisco. this is bloomberg. ♪

yousef: this is "bloomberg daybreak: middle east." the global selloff deepens amid concern on surging prices. the nikkei had fallen 10% since september, and s&p 500 is at its lowest since july. opec-plus maintains its planned gradual increase of supply despite the energy crunch. president biden warns the u.s. is at risk