>> from the heart of where innovation, money and power collide, in silicon valley and beyond, this is the technology with emily chang.

>> i am emily chang in san francisco and this is bloomberg technology. elon musk might have a whistleblower on his side. the former said -- former head of security of twitter says there are major deficiencies in how the company handles personal data and doesn't even know how many bots there are. lawmakers have vowed to investigate how this played into the $44 billion lawsuit. plus, zooms transition from an essential pandemic tool to enterprise business juggernaut may take longer than suspected. the cfo joins us and us -- joins us this hour. and meta-art about the ftc's lawsuit via a tweet. could this be the new norm under the new chair? we will get to all of that in a moment but first, katie is with

us. walk me through the day. >> it was a pretty mixed bag overall. the s&p 500, the nasdaq falling slightly. just a few tenths of a percent. then you look at the semiconductor index. a big outperformer today. of 7/10 of a percent. you look at some of the speculative corners of the market. we have the arch innovation etf. all of this as we sort of way for the big news at the end of the week. the jackson hole summit. let's look and some meme stocks and check in on that. you can see bed, bath & beyond is down a whopping 62% over the last four days. we think about where we were this time last week. it was a much different story. that seems to be a thing of the past.

broadening out to some more fundamental stories, we will look at some of the other big movers in the market. it is still earnings season. this is sort of quiet fears we have been having about the chinese slow down when we think about what we saw in alibaba with jd.com shares up. we heard from palo alto networks yesterday again, really strong billing numbers reflected in shares today, restored by more than 12%. twitter, this is where all drama was today. you will get through that whistleblower emerging. perhaps a win for elon musk. his lawyers have already issued a subpoena. >> drama indeed. thank you. you want to talk more about that right now. the former head of security blowing the whistle. they filed an official complaint alleging a rigid deficiencies in the way the platform handles personal data and bought

account. twitter refuting the claim, calling them opportunistic. could this change elon musk's attempt to get out of that $44 million deal? there is a hearing scheduled for wednesday. kurt wagner covers twitter. what has he claimed? >> this is someone who is incredibly well respected in the security industry. he came to twitter in late 2020 and there were a bunch of very high-profile accounts hacked by a teenager. jack dorsey made a big plan to bring someone in with real reputation and stock in the industry. he was there until earlier this year in 2020 when he was fired or dismissed. very recently in the building at

twitter. >> he was there very recently. twitter responding to the claim saying this is from the ceo. they are reviewing the claim but what they have seen so far is a false narrative. give us more detail on what he is claiming. >> he is essentially saying the company has not taken the appropriate steps to protect user data. he says they have not taken appropriate steps to update basic software on their data service. this is the thing that elon musk is jumping on. he says while the company does not actually know how many bots it has on the platform. it is a little more nuanced than that. we can get into that but generally when you hear that, you say this is what you have been arguing all along. the company does not know how many bots it has.

crimes they have already said we want to talk to this guy. how could this potentially change the case? >> first and foremost, let's stop for a second and say it is way too early to know whether this guy has the goods or not. people are going to have to dig in and see whether there is made on the bones of these allegations. tomorrow is not about this guy. it is about allegations that musk has made that the twitter people are hiding witnesses with specific knowledge of the spam and body counts and they are offering up executives and directors who don't have specific knowledge. the judge will decide whether or not twitter has to make the people with the goods available. >> and that you have been talking to a lot of sources. there has been the action from

within the company. what are people saying? >> there are a number of employees who are thrilled. to see someone on the staff level at the company coming forward and making these accusations. there has been speculation as to the timing. we are in the middle of this very contentious deal. and suddenly this huge like a huge, wrapped gift for elon musk. ultimately, this has even more chaos and confusion added to what has been a very uncertain time at a company like this. >> how often does it happen that someone comes forward claiming to have the smoking gun at the perfect time in a high-profile business case like this? >> it has happened before in a case called -- it is not unusual to have whistleblowers emerged when there is publicity about this big m&a five. everything has been drama central in this case.

it is not a bit surprising that we have had to this. >> what happens next? >> we have this hearing tomorrow. that will decide whether or not he gets more access to the bots stuff. going forward, we are basically keeping our eye on the process, gathering ammunition. both sides are gathering ammunition to make their case and we are hurtling toward october 17. the huge trial of the century in wilmington, delaware. >> you will be very busy that day. thank you. >> that entire week. >> thank you both. you will keep us posted on the drama. coming up, hbo gets a huge win with the house of the dragon. just how good an element is this? we will discuss, next. this is bloomberg.

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>> the game of thrones fan club was in the house sunday for house of dragon. the premier drew 9.9 million viewers on television and online, making it the best ever series debut in hbo history. it is becoming a battle of ethics between hbo and amazon which is about to debut its load of the ring spinoff. the rings of power. joining me now -- house of the dragon, what did you think? >> this is what hbo does best. big, epic, super expensive, tens

of millions of dollars per episode. but this is the bread and butter of hbo. i think the big question for investors is going to be how this evolves over the course of the next 12 months. warner media was acquired by discovery. the company came together in a merger and at some point next summer, discovery possible be matched together with hbo max, probably still called hbo max and we will see how those two brands come together into one service. i think when you look at something like the house of the dragon, this is everything that hbo is known for over the last 20 years. incredibly well produced, high-end, premium content. >> we are seeing those growing pains as this -- as discovery tries to merge these two cultures. what is your expectation about

how it will all play out? >> you have to -- the reality is for discovery that this was a thing. discovery did not have a future as a standalone company. they were going to be in deep trouble just being in the cable network world. that world was not going to look pretty over the next five or 10 years. i don't think anyone really believed in the future of discovery plus. because at&t needed to get out of the warner media business, this is this really unique opportunity for a safe to wind up being in control of one of the world's largest media companies. the negative thing is they have a lot of debt. that is why you are seeing a lot of costs cutting. i think the question will be this is an incredible group of assets and how much of their focus is on building for the

future? there is no doubt in my mind that the future of television is going to be streaming. linear tv is dying. warner still has a tremendous amount of broadcast cable assets. how do they transform that into the future and can they do that with that much debt load? you are seeing a lot of investors skeptical of the process so far. >> does the cost of the house of the dragon bode well for the lord of the rings project and all the money and time they spent on it? >> it is funny that you bring up lord of the rings. it is actually a great example of the different strategy you are now seeing at warner media. versus the old management. if you go today, turn on amazon's prime video, they can actually watch all of the

original lord of the rings. the original lord of the rings, those are warner brothers. there should be on hbo max and they are but now they are also on amazon's prime video. you see this culture now that is really changing inside warner media where instead of making it the exclusive home of content, they are really going back to more of a licensing model where yes, it is on hbo max but you can also get it on amazon prime. that never would have happened under the prior management team. you are seeing a real focus on licensing to generate profits versus the only sort of northstar was streaming hbo max. hbo max is no longer the sole focus of warner bros.'s discovery. they are licensing from third parties like amazon. >> we are seeing these streamers make more moves into sports. amazon will show thursday night

football in bars and restaurants as a deal with directv. you're talking about there being more viewers on streaming than on cable for the first time ever. his sports the only way to take streaming to the next level to that next generation or chapter? >> sports is a great way to get people to come in. if you have champions of the which is what paramount plus just acquired, the only way you can watch it is to sign up for paramount plus. if you want to watch wrestlemania, you have to have peacocks. each of these platforms are by his close of sports rights. the negative is you don't own the content. you have to keep fighting every 3, 5, 7, you have to keep fighting for these. netflix owned stranger things forever. it is not disappearing.

they don't have to rebid for those rights in three years. sports is a double-edged sword. but what is interesting is it is the last thing that has been holding the bundle together. you can't name an entertainment show on traditional television that anyone cares about. the only thing that is sort of holding the traditional matzoh -- multichannel bundle deal together has been sports. even sports are finally starting to move to streaming. i think that is what you have seen a record pace of cutting. this is becoming a problem for all of these legacy media companies because they have moved so much great streaming company -- so much great content to streaming. we believe apple will buy sunday ticket which is on directv. we think that moves over to apple. you are seeing real massive, seismic change that will have big problems for anybody in the

cable network business in 2023. >> i know you are a prolific tweeter. you are talking about this whistleblower that came forward that could give elon musk an edge in this battle royale to get out of that $44 billion deal to buy twitter. what is your take? >> it comes down to one fundamental issue. did twitter falsify this? they do not talk about bonds or the percentage of box. it just relied on the validity of twitters public filings. if you read them, they say we make a lot of assumptions in how we look at the part number. we think it is under 5% but we could be wrong. if twitter knowingly knew the number was far larger than five and every one of the filings was

essentially fraudulent because they were filing fraudulent documents with the fcc, musk has a case. i have a hard time believing jack dorsey and the entire management team at twitter has willfully for years been filing false fcc documents. it is possible. i think it is unlikely unless those documents -- unless those filings with the fcc are knowingly false. twitter has already said they could have had mistakes and how they did this. this is not an exact science. that is the case, elon will be paying 54 points. >> we are talking about the number of bots that advertisers -- that actually see advertising. that is what they are referring to with that 5% number. >> there are good bots that are part of twitter that you would want there but in terms of the

part that should be counted as monetize it will users is the term that twitter uses, they have said repeatedly that the percentage of bots on a quarterly basis is sub 5% based on their analysis but that analysis could be flawed. you would have to believe that they actually knew the number was north of 5% and chose to do different disclosure in the fcc filing. that is the only way that must get out of paying 5420. >> coming up, zooms big bet on the enterprise. that is on next, this is bloomberg. ♪

>> zoom was the pandemic golden child. but the move to becoming an enterprise business platform may not happen as soon as expected. kelly, great to have you back. let's talk about the good news and the less good news. if you are seeing growth from enterprise customers you're also seeing users and small businesses. when, how and where do you expect that to stabilize? >> great to see you. we are really pleased with the performance in the enterprise which grew 27% year-over-year. you talk about the very strong performance there. but there were some headwinds. a lot of it due to strings in the dollar as well as what we

are seeing in the way. but also, just lower acquisition and new customers at the top of the funnel which is impacting people around the world again. people are going out to happy hour with their friends rather than doing that over zoom. crisis slowing sales growth among corporate customers. >> we had a very strong quarter from an enterprise perspective. overall bookings came in stronger-than-expected. we are starting to see our enterprise sales cycle moving toward more normalized enterprise cycles. they are going a little bit more back and into the quarter. that led to high revenue. just a little less contribution to the quarter itself. but we crossed over that 4 million mark in august. we are excited to talk about that. we had record deals with greater

than 125,000 and we are seeing strength in our new product. >> bigger picture there, this narrative that it leads back to the artist. -- back to the office. employees are pushing back but this is still the policy as of now. i know zoom did its own survey on hybrid work. you found that executives still want that hybrid work environment. how are you adding all of this up? we are trying to figure out how much this will translate into demand. >> the great thing about zoom technologies is it enables work both at home and the office. we see organizations recognizing the zoom licenses for their employees that are working at home. but also, technology like zoom rooms, smart galleries, workplace reservation allows them to interact with employees that are in the office in a very inclusive way.

having the right technology in your conference room is becoming more important every single day. we have become used to seeing everybody's face on a square. even if you are the one like me -- i moved out of the straight -- out of the state of california, seeing everybody in that room makes everyone feel included in that conversation. we are excited about the prospect of hybrid work and new technology is there to support it. >> what is the next year of growth looking like to you? where does most of that growth come from? >> it will come from our enterprise segment and we will all focus on lots of new initiatives in the online segment that will drive it at first to being flat but also a growth driver as well. >> all right. that was the ceo of zoom. always great to have you here. thank you for stopping by. >> the ftc is breaking with tradition.

they learn about lawsuits the hard way, without any notice. this is bloomberg. ♪

>> >> welcome back to bloomberg technology. the ftc is breaking with tradition and it has its sights set on big tech. they are selling their countries

over there virtual-reality acquisition within a tweet. they typically give companies a chance to meet with commissioners and argue their case before filing a lawsuit. here to explain what happened is alex. what happened indeed. >> yes. they found out from this tweet that the ftc was suing them in an unusual case that i'm sure we can talk about in a second. what happens in these situations is if the deal is large enough, they have to file documents to the fcc which are sources tell us they did. they filed hundreds of documents and data points and then if it is imminent, though usually definitions before the -- depositions before that happens. the company was alerted to this via tweet. i will say they initially did not comment on the story. they got back to us today. they said they followed the typical practice by notifying the company after the fact.

that means and sources said this was unusual. they do not have any claim that they would be coming for them too soon to block this virtual-reality deal. >> what does the signal about the ftc approach on future cases? >> a bit of a different approach under chairperson lena con. she is about an appointee. who basically was brought into the agency that is meant to enforce antitrust laws and she has taken a pretty aggressive approach. this lawsuit in and of itself makes a little used argument likely nascent competition claim which means they are suing to block this deal on the future potential of this small and growing industry and they have alleged that med is acquisition of this was natural and it can actually tamp down a petition because it does not give the tech giant the resources to

create more competition in this space. a lot of unique things happening with this case. it also alludes to this kind of more aggressive posturing of the democratic commissioners on the ftc against big tech companies. >> i spoke with congressman david cicilline yesterday and asked him about lena con and her approach and this lawsuit in particular, some critics have said this is such a small company, why is the ftc bothering with this? meda has said the deal would increase competition. take a listen to what the representative had to say. >> i don't think there can be any of these taken seriously. time and time again, they have been found to engage in anticompetitive behavior. >> he went on to argue how much med and facebook in particular are anticompetitive and how supportive he is of lena con's

approach. what do we know about the support that she has in congress to continue? >> you will remember the house came out with a 2020 report pointing out that med alone had acquired more than 100 smaller companies and this is the only time the ftc has sued primitively to stop one of those deals. i know they might be looking at things like the bond going back and forth that meda still has regarding the instagram and whatsapp acquisitions. i think that people on -- we take that kind of approach think that the ftc has not done enough to -- on the antitrust side to make sure these giant tech companies are not basically uber and of everyone out there to tamp down or assure that they

have what they said in lawsuit is a monopoly on a potential future market. >> all right. thank you for your reporting on this. we will continue to follow. moving onto the world of cybersecurity. shares of palo alto networks sword after the reported strong quarterly results. can the cybersecurity landscape sustain its growth? we will talk about all of that and more with our guest area a very positive earnings report. you seem to be bucking the trend because we have heard a lot of bad news from other tech companies. how so? because i don't know. we are seeing noise, we aren't

seeing a signal out there that tells us there is impending doom. we see inflation. we saw a version of this two years ago with the pandemic. people thought ever they would fall beneath us. revenue is added for companies. i don't know if this one is as bad as that. >> do you expect demand to keep up or could companies tighten their belts over the next few quarters? could that software and cybersecurity services they want to buy? >> it is interesting. i have been talking to a whole bunch of market commentators about our stock and what we see. companies saw the e-commerce infrastructure is not up to snuff. they are trying to sell everything on the web. their customer economics

mechanisms are not ready. and hybrid work. if you add all that up, you unleash a sea of technology transportation. we are seeing a billing for security. it might get dented on the margin but i think it is still one of the safest and strongest sectors to begin with. >> how would you describe the threat landscape right now? there is this ongoing war on ukraine but the potential huge cyber apocalypse that some are wondering about with that has not necessarily materialized. there is ongoing tension with china. how do you see these global factors impacting the threat? >> if you step back and look at it, all the companies have been

visible. every time you have these types of businesses, you have people able to enter for whatever they want. we made everybody work from home. every employee's home is -- everybody's laptop is -- every interaction you have with your customers is a potential way of getting hacked. we have seen that. we have seen that in ransomware and business compromise. every four hours, there is a ransomware leak. clearly this is not just a nationstate threat. it is also an economic opportunity for small hackers or hacker groups to start making these economic demands of a bunch of people. you are seeing the threat landscape get more adverse. at the same time, nationstates

are looking at preparedness. we have not seen cybersecurity because we have had devastation caused in ukraine but do not at -- underestimate the amount of cyber activity that has gone down in terms of activists going after russian sides. we have not seen a tremendous amount of cyber activity like we did before. >> there is a new whistleblower and social media and i am dying to get your thoughts on this. the former employee of twitter claiming negligent security policy. grievous deficiencies in how they are handling personal data. they don't know how many bots there even are. there has been some pushback on this. it sounds like something that could be happening within a lot of companies. what is your take on this? >> i don't know the particulars of the situation. i read it about it on twitter as recently as you did.

i don't know what is happening there. i will say that one of the things that we have been canvassing for an opening for his more awareness about the threats. i think cybersecurity is the biggest continued risk in the 21st century. i don't think boards are well prepared to understand the magnitude, understand the impact that can be had. it is just a step on whether individual companies are up to snuff. i think it is an easy out. i think the ftc will try to create regulation on how do people have to expose cyber activity and readiness. >> there is this number we have been hearing over and over again , 600,000 open cyber jobs. you mentioned it is the responsibility of four but is it the government that should be stepping into help fill these jobs? >> i read 3.5 million. i'm glad is down to 600,000.

there are a lot of jobs. we need to make sure we are training people. this is not a singular problem of finding 600,000 cybersecurity enthusiast. i think we have not applied ample automation and security. that requires a bunch of clean data and integration. a bunch of clever and cybersecurity. i think the only way we saw this is if you can build the eye that stops these attacks from happening. today's model is not going to work. today's model is something happens, we collect all the data visually. look at them to see what actually happened. i think those days are over. it requires a lot more automation. they think they can solve a majority of those. we also need more cybersecurity. >> so curious for your thoughts on this last one.

this was long before he lost division fund. now we know he blocked tens of billions of dollars on some of these tech investment. what you make of this? >> he went from boom to bust. he reinvented himself and the one thing i love about him is that he has an appetite for risk. hopefully he can recover from that. i think last time, it was down to a billion dollars. i do think he got a bunch of companies on the wrong end. >> all right. >> coming up, how the crypto

winter tussled with an energy crisis, impacting bitcoin. more on that next. this is bloomberg. ♪

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>> time for our crypto report. the usually by local -- volatile bitcoin has been sterilizing -- stabilizing. >> it has been a difficult time

and i was with a bunch of the miners in miami. the mood is a little bit darker. bitcoin being under 20,000 is not good for anybody. if you are a buyer of machines here, you're getting a much better price than eve ago. it was held down a little bit by the macro. this is relative to the 60 day. it flips positive in the last week right after being negative. i think the capitulation phase is online. i think that speaks to the

general strategy that people should have around the balance sheet. i think it is too strategy that work well. all of this the way that irish energy does. that way you can grow the cash flow. all this is just using equity and debt strategically and not taking on too much debt and growing at that reusable speed. >> we think that in mid-september, the merge may finally happen. a theory will move from proof of work to proof of state. how does the upcoming merge affect how you want to be investing in these kinds of companies? >> the big currently minors will always be a good bet. if you believe in a decentralized monetary system, it will not function properly under a proof of state model. as much as a theory and could be an interesting currency for doing whatever, it is not going

to be the same thing that bitcoin is if it moves off. i don't think it changes anything. if people want to speculate, that does not bother me. i am a free-market capitalist but if you want to own and as it with something that cannot be disrupted or taken over by anyone party, you just have to start with proof of work and therefore i think bitcoin mining in north america has a great future. request that was my golfer there. coming up, what is quiet quitting? the concept getting a lot of attention among young workers trying to change office norms. we will discuss. this is bloomberg. ♪

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the office. the latest example coming from apple. more than 200 apple employees decided to demand the company continue its flexible work policy instead of its planned return to the office on september 5. and requiring employees to come in two to three days a week. they want hybrid schedules with direct reports rather than a corporate blanket policy. this comes at a time when the term quiet quitting is making the rounds on social media. the idea is not the idea that the employees actually quit but they do the bare minimum that the job requires to remain -- maintain healthy worklife balance. >> does not resident with you based on what you are seeing from your client? >> we have heard a lot of companies that all went remote during the pandemic and now that things are changing again, they want their employees back.

they think that being there and seeing those employees somehow equals culture or productivity. i think what is interesting about the apple story is what the employees are saying is we are being productive, we are giving our best and the way we can give our best is working this more flexible way. you hear it in the same sense as the quiet quitting conversation but is more of a story of the power of employees to create value and the role of the company in helping them do that or changing how they do that. >> you will see whether apple acquiesces here in any way but it seems that they are swinging back to the office. executives are having more power than they did a year ago when we were just starting to work through omicron. >> we will see. the pendulum has been swinging for decades in favor of employees.

more power, more control. companies are finding themselves in having to put people first and taking that on as an opportunity and a strategy, that has been very successful. now leaders wanted to be the way it was or some kind of return to that. i think some of them are finding themselves stuck. and ultimately, value is created by people. if you are not able to put those people in the best position to create value, you have a real problem. i think there are some companies like apple who have a huge investment in real estate and an office and they want to position that as an asset and a strength to those employees. some employees want that. some people want to go with the office and be with other people and really helpful to them. but for others, it is not. what you are seeing is multiple

different kinds of talent pools developing. other talent wants to work remotely, other talent wants to work in the office. in all cases, they have to choose based on what the talent wants. it is the people first driving business decisions. >> how is this impacting hiring and retention? you see a lot of people voting with their feet? >> it is easier than ever to get a job. people can just swipe left on you and swipe left on somewhere else and they're working at a new company. we are seeing people are resigning in higher numbers than they have been. people are getting hired faster than ever. i think we have almost two job openings for everyone job seeker in the market. companies are doing their best just to keep up. >> let's talk about quiet quitting and this idea of just

doing the bare minimum, not going to try too hard, i will not overexert myself. i would just do my job. what impacted this? question of is nothing wrong with doing your job and not ruining your life in order to achieve. but at the same time, at the point where it moves over to this area of taking advantage of the system, that becomes the problem. i think what this has shown is that for many companies, they don't really have a great way of measuring what a good employee actually is. they don't actually know what output and quality really looks like. they use this thing of how long are you logged into your laptop or are you standing in your cubicle rather than knowing which one of my employees are great. the companies who are people first focus on different things

and they don't have this problem of employees dropping out. >> last to continue to follow. i appreciate you stopping by. thank you. that does it for this edition of bloomberg technology. later this week, do not miss my conversation with microsoft gave mr. leah and check out our podcast, you can find it anywhere you get your podcasts. i am emily chang in san francisco. this is bloomberg. ♪

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