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caroline: i am caroline hyde at bloomberg's world headquarters in new york. ed: and i am ed ludlow in san francisco. this is "bloomberg technology." . coming up in the next hour, uncertainties about china's covid. the human story and technology story. what unrest means for apple and iphone production in the months ahead. ed: plus, sticking with apple, the tech giant is being called out by none other than elon musk. the twitter chief tweeting its ceo tim cook asking if the company, quote, "hates free speech." caroline: and another one bites the dust. crypto lender blockfi has filed for bankruptcy in the aftermath of ftx in the u.s. government is among one of the key creditors. we will explain. but first, let's check in on the markets. today was a day once again of federal reserve macro picture impact tech stocks. s&p 500 off by 1.5%. similar moves in terms of the nasdaq off by 1.6%. ,big-tech rolls over once again fed speak seems to irk the , market. the leaders over at the new york

fed, for example jong williams, , for jim bullard, both talking about the need for further rate hikes. rates go higher, the dollar goes higher, crypto go slower. it has been trading lower versus the u.s. dollar. down about 2% on the day. today it just resets and we are calling it flat. let's move on to see what also was working investors, this dampening of sentiment on what is happening in china, the protests. without the nasdaq golden dragon china actually rallied. why? why when you see unprecedented levels of protests versus xi jinping, versus the concerns of a covered lockdown? -- public covid lockdown? maybe, just maybe stocks trading were lopsided because that could mean a movement towards reopening of the economy. up 2.8%. ed: e-commerce, a really big driver in the markets. amazon, one of the few stocks in the green on the nasdaq 100 on monday. probably the biggest point

-paneer as well. there is up missing from the sales outlook from black and going into cyber monday, which is ongoing. pinduoduo, really interesting. really strong earnings from the chinese e-commerce giant on the lower end, on the discount end. having the best day since august. again that story as well probably a factor that what we are seeing play out in china might result in a policy change which would be supportive for businesses in tech. disney is down 3%. they will keep with the hiring freeze and are wondering about a move from linear tv. activision we will get into later. but very quickly, apple. we have to talk about this stock because it is under pressure with what we are seeing me out in china and the impact to production. caroline: over the last couple of days apple down 4.5%. you have been driving that story down. let's dive into it more because

it has been gripping the entire world, china's growing protests against covid curbs. here is what some bloomberg tv guests had to say about the sense of uncertainty sweeping chinese markets. >> as long as we are seeing the ongoing covid zero policy, we are not going to see much of a stabilization in domestic demand. unless the government moves away from its targeted approach. >> at this point, it looks like a rapid or a reckless opening of the economy would be worse for china's growth, because the biggest problem now of course is the labor market. >> for the time being it seems that the poor outperformance we have seen in the greater china region could be capped in the near term. >> the next few month are clearly going to be challenging, but we still feel comfortable that in the second half, china is going to be a much better story from an investment

perspective. >> interestingly, the world is doing well, primarily because people can't travel. we are seeing good spending and good traffic. in the mall. . caroline: that dig into the technology impact. bloomberg debby wu in washington. cover in particular -- you cover in particular foxconn and chinese companies. tell us what this means for business and the economy in china right now. debby: we have seen that this is becoming a challenging situation for the supply chain in china. we don't see a major impact on supply chains from recent protests or unrest in china over the weekend. in this instance, foxconn over the weekend is actually offering existing staff a monthly bonus of as much as 1800 yen to

continue working for the company in central china throughout december and january. foxconn is working very hard to make sure that apple will have enough iphones to offer its customers through the holiday quarter. and our colleagues in asia have reported earlier this week that it apple and foxconn are actually facing a situation that they could face a shortfall of as many as 6 million units of iphones. the most sought-after models this year due to reasons at the plant in central china. ed: do we have any sense of where things are going to normalize for apple in terms of the production line? you mentioned the 6 million unit shortfall. a source also told bloomberg that there was confidence they could make up ground in 2023? debby: yes, but at the same time

the situation is fluid because we aren't sure whether there will be further lockdowns in the region that could have an impact on the situation. another person familiar with the situation told bloomberg that existing workers affected by the ongoing lockdowns have been unable to return to work at foxconn's plant in central china. it is a major issue affecting production as well. i guess we just have to wait and see what happens over the next couple of weeks. ed: bloomberg debby wu, thank you very much. let's continue the conversation with scott moskowitz, asia-pacific geopolitical risk analyst. the question we go to now is, is this a flashpoint, or is this going to be an extended period of political, social disruption in china in response to what is essentially policy from the chinese government?

scott: thanks for having me. that is an excellent question. these protests are unprecedented, unlike anything we have seen. the quickness with which they spiraled and the fact that they are taking place across multiple cds, multiple geographies, and that somehow people in one city seem to be aware of what people in other cities are protesting and drawing inspiration from each other, that is something we rarely see in china where the state is normally so good at atomizing these things and pushing them under the rug. it will be much harder to put this back in the box. caroline: already, many an international company has been worried about doing business in china, largely because of covid lockdowns and a healthy dose of geopolitical tensions between the u.s. and china, antagonized over the weekend with the news that zte and the likes of huawei will not be able to sell their products in the

u.s.. how does this affect, for example, u.s.-china relations going forward? scott: i don't know how much bearing this has specifically on u.s.-china relations. but u.s. officials have to tread carefully here. because they want to show support and express support for any kind of free and open protest, especially one that might signal a greater desire even for democracy that some people have been talking about, which is very rare. but the second that u.s. officials stepped -- step in and start saying how much they support it, china can latch onto those sorts of narratives and spin it as this is something that was cooked up by the u.s., start going to this conspiracy theory propaganda. and so that is the advantage of trading very lightly. not just because they don't want to make the protesters look bad, but also because that could really harm u.s.-china relations, which are just starting to recover after the xi/biden meeting. ed: earlier i spoke to the cfo of infineon, a chipmaker that has a significant footprint in

-- significant operational and sales footprint in china. this is what he had to say about the situation. >> we have really improved our resilience a lot over the past quarters, months and years. therefore, we are looking at this with concern, but up to now, there is no direct indication visible on our operations in china and the region, and we have backup plans in case it becomes necessary to make adjustments. ed: he makes it seem like this is just the latest in a string of ongoing disruptions. what is your assessment about the reality of life on the ground and operating in china right now? scott: i don't get the sense that everything has ground to a halt, but i do get the sense that we are in a sort of a wait-and-see moment. it does not see like they have able to disperse these crowds. they missed the window on censoring and isolating it right away. even as they start to do that, people know these protests are going on and they are aware.

people are showing up with their blank pieces of paper, that has been a real prop of the protest. whether it is grinding to a halt, you talked about earlier the protests in guangzhou, but those were more isolated. i get the sense these are more urban and middle-class protests. we haven't seen so much labor protests outside of that. so it is a question. but there is a lot of uncertainty, and we know sometimes covid lockdowns have been used almost politically. so anything is sort of on the table. we wait and see how this will unfold. caroline: i know that in some ways, what has occurred at foxconn, "iphone city as it is known," is somewhat different to what is happening now on the streets of beijing and shanghai, but they are related. a lot of this is frustration about how people survived amid these lockdowns. many have been looking at apple in this situation, the key supplier foxconn, their exposure being significant, they didn't

build enough backup, they were too heavily dependent as a supply chain on china and didn't do much to disperse that. you think companies are now significantly moving away from a chinese supply chain, or will they look to just think this is an episode? scott: i think you are absolutely right and i think it predates this. i think it was over the summer, after how speaker pelosi visited taiwan and there was that deeply jingoistic military reaction. people got really spooked and they started for the first time to envision a future where china might come for a lot of international companies, geopolitically off-limits. and they all started to scramble and think, wow, we need to look at serious contingency planning. and things only seemed to get worse from there, that is what we saw in our data. relations seemed to get worse and worse, collateral negativity only got worse. and then this really did seem to be affecting both china and the u.s. people were concerned

xi and biden met. it seems to calm temperatures. then this happens. ed: scott, we asked our audience what is top of mind for them, the concern about what is happening on the ground, specifically with apple. their answer very clear -- working conditions. my question to you, does working -- those working conditions, do we see a policy paper from the chinese government? scott: the government is sometimes more responsive than people realize in china, because they don't have a release valve of elections like we have, so they will have to move in order to quell dissent. but they have to be very careful , because if they open up too quickly, then it could really embolden and enable these protesters. so i think they are going to tread lightly, but i don't see anything terrible happening just yet. but we are waiting. it could be a victory for the protesters, we do not know. there might be small movements. ed: scott moskowitz, asia-pacific geopolitical risk analyst for modern and consult. dash for morning consult.

thank you. let's stick with apple. the company and its ceo are being called on by elon musk, who claims apple has cut back its advertising on twitter and even threatened to withhold its social network from its app store. musk tweeting quote, do they hate free speech in america? then posting again, this time including the twitter account of apple chief executive officer tim cook. no response from tim cook on twitter. we will have more on that story later in the hour. in coming up, activision blizzard is gaining some fans. why some analysts raising their recommendation despite concerns over microsoft's deal for a takeover. this is bloomberg. ♪

caroline: so, activision blizzard has gained fans on the street, as a flurry of analysts raise recommendations on the stock, even as microsoft's planned acquisition looks more and more dicey. bloomberg's yiqin shen is joining us now. just talk to us about what you're reporting is showing. first and foremost, what are the odds this deal actually goes through? yiqin: sure, yeah. i am hearing from merger traders as they see the deal is probably happening roughly 40% or 50% of going through. it is pretty dicey. but interestingly among wall street analysts, they are boosting their rating on activision, the stock itself. mainly for two reasons, i won't say. first there is the strong fundamental value. second, the very attractive risk reward profile, given the microsoft situation. activision is in the process of being acquired by microsoft for $69 billion. that is a huge deal.

but there was a report last week saying that the ftc, the u.s. regulator, is going to block and challenge the transaction, so the stock tumbled. but analysts like that stock with or without microsoft. their case being that as a standalone company, activision has strong fundamentals, very solid growth outlook, immense franchises including call of duty. and they will get a $3 billion breakup fee to add on their balance sheet if the deal falls apart. on the flipside if it goes through, then look at where the stock is trading. it's like 20% below the takeover offer. that is a huge upside to capture in that scenario. ed: you have taught me so much about the twists and turns of dealmaking, you and i followed the twitter deal so closely for months, for example, in the

thing you taught me throughout that process was not just across the numbers, but it is to look out for key inflection points. key decisions. so what is the big key decision were key moment we are looking for between activision and microsoft? yiqin: i would say antitrust progress has always been the focus. right now it is waiting on approval from the ftc. but also it is facing the probe under u.k.'s cma and the european commission. so, regulators have raised concerns. if this deal combining a number three and number five largest players in the industry will give microsoft too much of an advantage in the space, or if they will withhold popular titles against their competitors. i would say another thing to watch is more broadly, ftc or the biden administration has had this very aggressive narrative around big tech players all year around. when it comes to antitrust issues. so that is particularly putting this mega tech deal under the

spotlight. caroline: it is interesting, today our great colleagues at bloomberg intelligence put out a piece talking about how actually, microsoft is no one -trick pony what it comes to m&a, they have been on this rodeo before and quite often, they make concessions. are we likely to see that? yiqin: that is definitely something people are watching, and people are watching the next catalyst is when the ftc will drop their final decision on the case on this deal. media reports are saying that that could come either later next month earlier next year. it will depend on if they offer some behavioral remedy and if the regulator accepts that. and if actually the ftc decides to block the deal, that microsoft still has the option to appeal the case in the

courts. in remember, there is a similar case between united health and -- health care. they got a challenge from the doj, but eventually won the court's approval and that deal eventually closed out. ed: thanks to bloomberg's you shiyin chen on all things activision. coming up, the latest in the round of tech layoffs from around the world. let's take a quick look at peloton. shares up at one point as much as 8.8% monday, highest since november 15. this as adobe analytics says exercise equipment performed well on black friday. sporting goods sales surging over the weekend. at the same time, the original peloton bike being offered at a discount monday on amazon. this is bloomberg. ♪

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>> 2.5 years ago we lost 80% of our business. we laid off 20% of our employees . and they said at that time that we were going to be prepared for anything to come. >> we don't need to lay off half the workforce to achieve the efficiency levels want to achieve. >> we did announce a small restructuring. ours is really about rebalancing. the headcount we had at the begin of the year, we estimate we are going have the same heads at the end of the year. >> we are not stepping on the brakes, we are stepping on the gas. we are not cutting, we are -- we are still hiring. we are not freezing. we are not cutting. we are growing. ed: that is what some of the biggest tech ceo's had to say about their own strategies surrounding layoffs. and in today's "talking tech," we are taking a look at those companies that are not, well, so optimistic. in mexico, used-car company kavak is the latest to cut jobs. america's biggest startup is firing managers due to higher interest rates at a slowing economy according to a memo from the unicorn's ceo.

now, last week: hp said it would cut as many as 6000 jobs over the next three years, joining names like amazon and cisco who also plan layoffs. employment was very strong globally. the jobless rate was 4.4% in september across major developed economies according to the oecd. that is the lowest level since the 1980's. but this time around, tech already has staffing numbers way above pre-pandemic levels. layoffs have already begun, so the sector is bracing for more cuts to come. that is "talking tech." caroline: let's get a little more global right now. another story keeping our attention, the main privacy watchdog for meta in the european union has fined facebook's company to $77 million for a massive data breach. meta was penalized for failing to prevent the leak of personal data of more than half a million users. the fine was imposed by the irish data protection commission. meanwhile coming up,, what

retail data can reveal about the state of the supply chain. this holiday season. all of these insights and more, next. and are traasdahl, ceo of crisp. this is bloomberg. ♪

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>> i think this intentionality actually is indicative of the state of the consumer. consumers are looking for value right now, they are looking for

quality. they want to buy from their favorite brands, but they want a good deal from their favorite brands and they are willing to wait, whether it is black friday or cyber monday, to buy that. the second piece of it, you mentioned this in your opening, you talked about omni-channel, this idea that consumers want to buy in whatever means that is most convenient for them. whether that is online, off-line, or on social media. that is now steady state. when you add that to direct-to-consumer as a business model, it connects the merchant and the consumer directly. i think that is the current state of retail and it is exciting. caroline: welcome back to "bloomberg technology." that was the shopify president earlier today. ed, you are taking a closer look at shopify and other retailers post-black friday. give us the big picture. was it good? ed: yeah, well, the market things to assume -- seems to think it has been ok so far. shopify gave some prelim numbers for black friday. the street seems bullish on those pre-lim numbers. there is evidence consumers are taking advantage of those deals. some of the stocks we are

watching are the names in the e-commerce space. amazon had a good start but fell away. shopify, an outperformer. a lot of names jumping on early data coming out. wayfair another one. peloton, interesting. according to adobe analytics, it really was at-home fitness equipment that did well, at one point up 8.8%, but pared those gains. adobe analytics data is where i want to go. this is a third-party measure of how things are going this holiday shopping season. for me, the psychology about wine. which day getting a laptop or your smartphone and buy something? and according to data from adobe analytics, it is very much cyber monday. that is one across the holiday shopping period, it's an individual day they expect $11.2 billion to be spent. thanksgiving day comparison, black friday, it seems like consumers need a few days to get over their turkey and get out online to buy some deals. nurse agnes yarlee let if the

other years, let's look at 2022, we expect growth for 2022 across the holiday season. e-commerce spending for the united states, we are on track for $210 billion, representing 2.5% gain on the holiday season in 2021. but i find that fascinating , because it is still growth at a time when we worried about the slowdown in the economy in the economy. we are worried about the strength of the consumer. what i am reading in the data is actually discounting and deals doing the trick, albeit not in the same way it was done in previous years. caroline: is it inflation-adjusted? let's put it to are traasdahl, a great set up, who can enlighten us to the supply chain data, the platform he brings for brands, distributors, and retailers. you give them an inside track on what is happening in terms of their supply chain, and how to be more efficient. let's go back to that data, the growth. are we seeing, on an inflation-adjusted basis

growth in terms of spending? , does it look healthy? are: it looks healthy but i think at the same time there are a lot of supply chain challenges so looming. on the one hand, retailers are reporting that they have to much inventory. at the same time, they are reporting that they are out of stock. so retail is highly seasonal, as you know. and retailers are still struggling with getting from the last season and a season before that. at the same time to have a lot of supply chain challenges, getting the seasonal products in for this upcoming period. ed: i hear you a lot on the supply chain challenges side. for caroline and i over the last 18 months, that has meant difficulty in moving goods from a to b. but the other issue that we hear about is inventories. what role will inventories play for some of these online retailers, this holiday season? are: the same challenge, really.

you can have a very long supply chain to get the inventory to the consumer. so you have retailers, distributors, wholesalers, manufacturers importers, , exporters, etc. it takes a very long time for the inventory to actually get through this entire supply chain. the numbers that we got a few days ago here is that 90% of the retailers say they have too much inventory. at the same time, 88% say they are already starting to run out inventory for key items. historically, it has been very easy or much easier to plan, but with everything going on now with inflation and the consumer shifting to online, for instance, it has made it really hard to plan. there are very lovely times the supply chains. that makes it hard and everything is not real-time. caroline: i am going to ask you to talk your book here, so don't gloat too much.

the companies who have managed inventories pretty well, macy's was one of them. this company has invested a lot in technology, in the ability to ensure they have the right thing at the right time and be swifter about getting things that will sell in the door. talk to us about how your technology is perhaps helping alleviate some of the supply chain headaches that have been such a hallmark of basically every e-commerce and brick-and-mortar store at the moment? are: before the pandemic, everybody thought you could push a button today and tomorrow the product would show up. and in reality, you really need a tremendous amount of data between the different trading partners. so, where we started, over 10 million companies involved in getting food from where it is produced to where it is consumed. but technology that actually is connecting all of this, is based upon something that was invented in 1973, edi. and it's very reactive in terms

of purchase orders that go through the whole supply chain. so everybody understands what consumers are doing, what the price is, how much exists. everybody threw the whole supply chain can have real-time data. and then we avoid these huge overstocks we have seen, and also the shortages. ed: that is interesting to me, because you're talking about the company controlling what it can control. but how do you control the consumer? we went into this period knowing that promotions would be key. we knew they would be greater than last year, i think the data shows as motions were greater than last year. what is your analysis of the role that discounts play for online retailers? are: discounts are incredibly important. very often, blunt instruments are used when you can have surgical position instead. in order to do surgical precision, you need to understand what store is selling, what price point, how

inflation-sensitive is that particular area. so you can be much more precise. some care more about price than others, but you have to have really granular data at the store level and also understand inventory levels and pricing and what competitors are doing. historically, we have seen a lot of blunt instruments being used, and for an affordable price, you can use surgical data instead, to optimize. caroline: talk to us about how that really works. say you realize a lot more shoppers are wanting a particular item in brooklyn vis-a-vis what is happening in minnesota, and you can therefore have a cheaper price point. the fact that while i am in the store i can pick up my phone and decide whether this is the price point i want to pay or i can wait a couple of days and get it cheaper, how do you manage that amount of data that the consumer has? are: you put together all the consumer data, the data they all

distributor has, and the supply chain into one northstar in terms of data understanding. very many just look at their own data, but they are part of a big ecosystem of companies that all need the data. and so the sharing of data across companies with something that did not happen as much before the pandemic, and everyone operated in their own silo. but now they see that sharing data matters a lot. because manufacturing, they can build your products and they can get their products out in time. now they have a tremendous amount of products sitting from last season. so getting there in time, that's incredibly important. ed: it is november 28. give us the are traasdahl outlook for the rest of the holiday season, which seems to go on indefinitely. are: [laughs]

it is always the holiday season in retail, which is incredible. i think we are going to see continuous spend in q4. 6%, 7%, 8% increase in spend in q4. i think we are going to see a lot of price reductions. we are going to see a lot of shortages of products. i think a lot of people are going to realize that the supply chain crisis is not over. that it can continue to ripple through the supply chain. ed: are traasdahl, ceo and founder of crisp. thank you. coming up, the crypto chaos continues in the aftermath of ftx. blockfi has now filed for bankruptcy. leading more traders with trapped money. we discuss the latest, next. this is bloomberg. ♪ ♪ ♪

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>> we see the same confidence and the full confidence in coinbase that we have seen previously, and we don't see anybody leaving the space. that said, given that emea, and when i say emea, i not only mean the european union with that regulation, but also the financial services and market bill that is passing through the u.k. parliament at the moment, as well as the creation of the virtual asset regulatory authority in dubai, is really leading the charge in creating regulatory territory and a -- regulatory clarity and a regulatory framework that we can work within. caroline: daniel seifert there. emea managing director of coinbase.

let's talk about confidence more broadly in the space, after today's perhaps inevitable news that blockfi has finally had to file for bankruptcy. joining us now is sonali basak. i say finally because it was anticipated, because the white knight had been the now bankrupt ftx leader previously. sonali: we have been expecting at least for a week that this would be expected, and now we have some details. what do we have from them? we have not just the plan to file for bankruptcy in new jersey, we have some details about the scope of how big this bankruptcy proceeding is going to be. $1 billion to $10 billion in assets is the general size of blockfi. caroline: quite a large size. [laughter] sonali: quite a large size, but more than 100,000 creditors. we have to keep an eye on future filings to see how many that will ultimately be. ftx had also checked that last box on their filing and it found out later that was about one million people at play that we are talking about. we also know that the concentration is different among the unsecured creditor group. what is that exactly? it is the more than 700 million

that is really highlighted here, earmarked to the trustee of different depositors. ftx itself, which we will talk more about. also you have the sec from the remainder -- caroline: number four, right? the fourth biggest creditor. sonali: exactly. so there are a lot of names that you don't have here, similar to ftx. but the amounts are isolated between $1 million and $30 million. you might see more contagion to the people they are owed money to because we know that is the general size per customer, per creditor that is owed money and how much generally they are owed. . >> there is the question of chronology and timeline. because it is clear blockfi had issues before ftx's collapse, but at the same time, ftx's collapse has seemed to make things worse for blockfi. if you follow that, what is the relationship now between the two? sonali: that claim here on the bankruptcy filing is about $275

million for ftx earmarked. there are some really interesting unanswered questions here. if you look at the testimony by an advisor here, you had seen that they did not get money. they didn't get all the money they had asked for from ftx to begin with, according to the blockfi filings. remember, to your point, some of these issues started before ftx. that is why ftx got involved in the first place. they were related to three arrows. in ftx's filing, i would also point out that apparently, the u.s. business of ftx lent money to blockfi in part through that ftt token. so my question here is, this entire agreement, who owes who what? and who is responsible for actually paying each other back after this tight web knitted after the three arrows debacle, i think is interesting. now, remember, blockfi has also said that getting money back from ftx may take time, given ftx's own bankruptcy.

so things are certainly complicated between the two. caroline: over the weekend, it looked as though much of crypto twitter up and left to the bahamas. that is because of the different jurisdictions in which ftx has been enveloped. same thing here with blockfi. obviously chapter 11 is a protection in the u.s., but it was not just based in the u.s. sonali: i spent an inordinate amount of time today with this. in this case, i will tell you just how much in a moment, but for blockfi they filed a petition in the bermuda supreme court so they would have provisional liquidators in both regions. now, remember, from berhow mas'' point of view, for ftx, there is a lot of dispute that has occurred since bankruptcy proceedings have begun, to the point where you have the attorney general saying that some of the words

that have come from the new ftx ceo are regrettable. so to the extent that the bermuda government and the u.s. stay in line in this bankruptcy filing, they want to recoup money for their clients. it has reified the credibility of every financial system, an ability to embrace crypto still, but have tight rules around the industry such that people do not use their funds. -- do not lose their funds. caroline: we have to go, but you teased us. sonali: $6 million. caroline: she is going to go back to those bankruptcy lawyers now. coming up, elon musk picks a fight with apple. we will tell you why, next. this is bloomberg. ♪

caroline: today, elon musk has once again been going viral on his own platform and others.

this time, he is during a fight -- this time, he is stirring a fight with none other than apple. musk says apple has halted most of its advertising on twitter, and asked the company quote, if they hate free speech in america. he even appealed directly to apple's ceo asking what is going on here, tim cook? it also went on to accuse the company of threatening to remove deplatform from its app store. he did not say why, though. this all comes as many companies have halted spending on twitter amid concerns about elon musk's content moderation plans for the site. watchdog site mediamatters reported last week that half of twitter's top advertisers had pulled advertising on twitter after concerns about the direction of twitter. ford and jeep among them. elon musk meanwhile has been blaming activists for pressuring active visors and is talked -- pressuring advertisers, and talked about twitter seeing a massive drop in revenue already. he said in the past that he wants to make money for twitter by turning it into a paid some script and service, with a relaunch of its paid verify

services due friday. but for now, the vast majority of twitter's revenue still comes from advertising. ed. ed: yep, let's stick with the story and bring in kurt wagner, our social media reporter for more. there is a lot to pick here. what happens if apple took twitter off the app store? i guess that is the place to start. kurt: sure. that is a pretty dramatic outcome, right? this would be that twitter is routinely allowing terrible content on the platform. usually apple reserves this for egregious violations. and so if this were to be the case, of course that is a huge blow to twitter. the app store is probably the main way, or one of the main ways most of its users get the app, get app updates. i believe the app which the work -- would still work on my phone, but in order to get an updated version of my iphone, i might have to figure out a way to download that from the web which

will cause a lot of people either to stop using twitter or have to move to a different device. that is a huge issue. i think twitter needs apple a lot more than apple needs twitter here. that is because apple has the distribution at his fingertips. caroline: i was pretty surprised that apple was one of the biggest advertisers with twitter. kurt, meanwhile, the cryptic war, almost, he has declared on apple, continues. talk to us about what he means by free-speech suppression. he said in a tweet that twitter files on free-speech suppression will soon be published. what does he mean? what is he going to declare? kurt: we don't know, but he is certainly piquing our interest. he is saying, look, now that i am inside the building and i have had time to figure out what has been going on behind the scenes, i am going to unveil what twitter has been hiding

from you this whole time. there were a reading that means that he will come out and say here are the types of tweets that had been downgraded in the algorithm, or here are the types of accounts that had been removed and you did not know about. this is speculation, because he is intentionally building this drama. but again, what he has tried to say all along is he is this free speech kind of evangelist, and he is going to come in and make twitter the free-speech version of the service that people want it to be that it has not been because it has rules around what you can and cannot say. ed: we know the new look verification system is coming friday. what has musk said, what are the details? kurt: he mentioned, and i think we talked about this on spaces on friday, that there is going to be a series of different colored badges. at least that is the plan for now. i am going to forget the colors off the top of my head, but presumably you might have one color if you are an elected official, you might have another

color if you are a brand, or if you are running an account that is representing a company, versus an individual person. this is actually not a new idea, it is something folks around twitter had kicked around for a long time before elon showed up. this idea that there should be different labels for different accounts, including one for bots, believe it or not. there was an idea that may be bots should exist on twitter but they should be labeled as bots so they know you are interacting with an automated account. so as you know, this plan for verification has changed almost daily for the last couple of weeks, so we will see what it looks like when we actually see it live. but as of now, it seems that he is trying to get a little bit more strategic, and instead of everyone gets the blue check, there will be different variations of that. caroline: green, gold, blue, we wait to see what this rainbow is going to look like. kurt wagner, thank you so much for joining us on spaces. digging more on what is happening. it is only monday.

we are going to let you get back to your day job, which is tracking what that cryptic tweet does mean. but ed, it really is a story that continues to unfold, and the fact that elon musk is taking on apple, and almost retreating videos epic games made about apple's business practices. it really does seem like he is going for them. ed: gold check for business, blue for individuals, by the way. that does it for this edition of "bloomberg technology." make sure to join us again tomorrow. adam selipsky will be joining us. you do not want to miss it. this is bloomberg. ♪

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