>> welcome to squawk alley. here at post 9 and joining us this morning is business insider founder and ceo back from davos. good to see you again. >> glad to be here. >> facebook is our lead. soaring after revenue top estimates. it generated 13 billion in mobile ads in 2015. julia spoke to sheyrl sandberg yesterday and joins us with more. >> 80% came from mobile last quarter. user engagement is up especially on mobile and businesses are following and also said the company is benefitting from

videos explosion. >> it's really strong on our flat form. in terms of our business that creates real opportunity to us. we want the ad format to match what consumers are doing. we have the ability for marketers to use that format. >> facebook is using a new me trick. users are watching 100 million hours of video a day on the platform which analysts seem to see as an improvement over the number of total video views which is what facebook used to report that didn't take into account how long people watched. while facebook did not break out instagram. facebook is pleased with it's broke and at 98 of facebook's top 100 marketers are on inis it graham as well. i also asked if she's concerned about global economic uncertainty. >> certainly economic uncertainty in the economic environment for all businesses and clients effects us.

that's if we're well positioned to continue to take advantage of and double down on the shift to mobile which is happening. we also know we have a lot of hard work ahead of us. in order to don't to execute we need to stay focused and invest in the right things and make sure that we're driving our clients business so we plan to remain very focused on our own execution. >> and part of that execution is investing a little bit further out in facebook's future. both sandberg and zuckerberg pointed to oculus. >> let's turn to mark zuckerberg. here he was talking about book's shift to mobile. >> we realize that mobile was growing faster than desktop and people were shifting their usage and that it was the more important thing for a consumer experience and that's when we made the shift.

not in our business first but in how we developed products and i told all of our product teams, you know, when they come in for reviews, really just come in with mobile. if you come in and try to show me a desktop product i'm going to kick you out. you have to come in and show me a mobile product. >> cramer called it the quarter of the year so far. mark compared it to google circa 2007. do you find any hair on this at all? >> no, it's blind blowing. they are killing it. the issue for the stock is where they are in this product cycle. how many more adds can they put in the news feed. where are they in term of rolling out video ads or on instagram. if they're in the middle of the cycle there's a long way to go of spectacular growth but we'll slow down and i don't think that oculus lift is going to be in a

position to carry the company at that point. that's going to take a long time. the question is where they are in this cycle. >> but the company built a reputation that marketers will buy what they sell. >> well, i think marketers will try and i have to say on the video peace it's incredible what they have done. they have created the video environment for mobile. back in the analog tv days it's all about what you watch. and it does show that they're listening and they were dinged for reporting a view for less than 3 seconds or 3 seconds or what have you relative to youtube. distribution is exploding. it's a huge opportunity for revenue if they get it right. >> why did he take facebook out of the strong group? i don't know. i wonder if he's regretting that today. the bagel versus the fang.

a couple of reasons i don't think gook has to slow down any time soon. if you take a look at the proportion of users that are from north america among daily active and monthly active it's around 15%. if you look at a percentage of ad revenue coming from north america that's half. as the story becomes more international. as the middle lass arises in any one of these geographies there's more ad revenue. plus he went ahead and broke out marijuana as it's own app even though users cry we hate it. we hate it. now we love it. it's a huge property for them. they have transaction revenue as they try to use that and so diversified. so early as a company. >> you raise a good point and that's a question that others are asking about the ad load. how much of this can they sustain before we start talking about user experience and being

turned away. >> and they're very sensitive to that to their great credit. but then you jump to the video environment which is different. you go into a new environment it's a great environment and much room for improvement there. the ad load there they may have a much longer way to go. so really all it is about where they are in this cycle. i say agree with john. we're in the middle or early. we're not right at the end of it. the problem with the stock is its expensive. at some point the stock is going to trade at 15 to 20 times earnings. the multiple is going to compress. it's just like alibaba. we have that in our future somewhere but it may be many years away. >> i actually engage with facebook ads. i'll actually click shop when i'm on mobile. that's a store before. let me take a look at what they have. that's behavior on twitter. on google. it's pretty unique. so i don't know if it has to do with their data. i'm sure it does and how it's tuned to me but more and more

i'm buying the story from facebook and adds being content when they're correctly targeted. >> it's a whole new kind of advertising. you have to hook people in the first second or two. don't think of it as a 30 second spot. think of it as you have a second or two to get somebody's interest and have them watch it because they want to watch it. you're selling a product they might be interested in. this is so great for clients and advertisers and users. you don't like to scroll by. nobody pays for that. that's good but it's going to require a lot of transition within the whole advertising community. >> facebook by the way kurnltly trending for the fourth best percentage gain in it's history today. let's move to alibaba. shares are down after revenue and profit did beat estimates shrugging off a slowing chinese economy. >> more than half of all purchases through alibaba's platforms now come from mobile devices and talking about gross

merchandise volume. it is china. it's a great way to play china but you have to believe in china first. >> not the only way to play china. this alibaba certainly follows a narrative that i'm seeing emerge in tech earnings this season. if you are selling something directly connected to the pc or smartphone sales you're having a rough season. if you own mobile applications or accessory that rides upon the mobile trend you're doing okay. alibaba is one. they ride on top of mobile. a lot of their users are converting on mobile but because of that and they're taking share of more retailers they're continuing to do fine. >> this is a bet on the fact that consumption is going to become a greater share of gdp in china which is the transition they're making. with the hiccups. can you even invest in this stock given the near term hurdles if you believe it's a ten year play. >> if you believe it's a ten year play they're in great shape to capture that and they have

huge cash flow and cash that they can use to move outside of china so there's opportunities there. issue with the stock since they went public has been they had an incredibly high profit margin so there wasn't much room to raise that to drive earnings and revenues decelerating because they're so huge. usually you get multiple compression and that's happening with the stock. the company itself looks healthy. >> the company at the open, the stock up in the green, pretty sharply. they did see 32% year on year revenue growth. it's the quarter that captures singles day so the numbers are just incredible. it's 65% of chinese commerce. now it's negative because investors didn't get what they wanted. they didn't get what they wanted and for the numbers to come in like this and the stock to trade down 1.5% is pretty stark. >> it was an expensive stock. it's getting less expensive but it's decelerating. a lot of con serns about the economy. they're doing well relative to

it but you can understand. >> by the way, we mentioned this comment on the call talking about gmv. take a quick listen to that. >> today our gnv is no longer captures all the value proposition that we deliver on our platforms to the brands. what they're toing is building customer base and focussing on the lifetime value of these customers so that these customers can come back and make repeated purchases and become loyal to their brands. what you're seeing monetization rate going up is revenue is reflecting this prop tigs that we're delivering to the sellers. we should focus on how we monetize the users. >> trying to play it down as a me trick. we'll see if that works. >> ebay and paypal heading in different directions.

shares of paypal rallying amid climbing user growth. on the flip side shares of ebay were hit hard after giving weak guidance for the rest of the year. that's ebay's second earnings report and it appears the company's core business is struggling. we used to ask why isn't the name of the company paypal and every quarter we know we learned more. why. >> well i dispute the sort of reaction to these earnings. i think if you look at a long-term chart of paypal where it closed when it first started trading it was up around $37 when it first came out separate. now it's down 33. ebay, it on the other hand was in a different place. so that's still happening. they still have to turn this around. i wouldn't count them out though. paypal has its problems too. don't let one quarter be your whole story. >> ebay has been struggling for years. stepping way back.

amazon had to go through some struggles. they got through it and invested on the front end. all the services. ultimately it's a bigger and broader and more valuable service for consumers. ebay stated person to person, smaller businesses, it's time to actually sell to amazon. merge them. put them together. all the things that amazon has around prime. shipping, all the ware houses those would be valuable for ebay. >> for tax reasons there's still a few quarters before that becomes a real conversation to have and i'm wondering what it means from a messaging standpoint when a company that's supposed to be a growth company says we need to go out and spend our money buying our own shares. >> stocks can sustain very high multiples when accelerating or operating leverage where the

margins are going up but when things start to decelerate and investors don't have a good story about what is going to cause it to reaccelerate everything trades at 15 to 20 times earnings. eventually it gets there. they want to spend a lot of money buying it at 35 times earnings. welcome to it. >> we all come from dust and to dust we shall return. >> i'm going to take the other side. why not buy etsy. it's cheap, right? >> buy etsy and then sell amazon. >> henry, it's good to see you again. >> meanwhile the markets are back in positive territory of a brief dip into the red. a large part of that is oil which has given up it's gains. brent touched $35 barrel on that expectation or comments about some production being cut from opec. qualcomm is falling and company

did give weak guidance due to slowing demand for mobile chips. that was going to be an issue and made comments about lg. that's knocked down 6%. under armour having the best day in two years surging after earnings in their top expectatio expectations. that stock is up 18% january of 2014. it had a day when it was up 23% but still quite a gain after it's earnings and amazon shares rallying after the new york post reported the company is planning a subscription music service. going into that a nice bid up 5%. >> when we return, a immediate jeopardy to patient's safety. plus a ton of tech companies already reported. patterns beginning to emerge. who is winning and who is losing. keeping your voice af, one

company trying to prevent identity theft through amazon echo. we'll talk to the ceo when squawk alley comes back. these are the hands, the hands that drive commerce, that build business across borders. these are the hands of pitney bowes, the craftsmen of commerce. these are the hands that sew the seeds of business growth, that weave the data, and find the perfect spot to thrive. these are the hands of pitney bowes, the craftsmen of commerce.

>> more trouble. regulators warning the company's lab poses, quote, immediate jeopardy to patient's safety. meg is back at headquaters with that story. >> a pretty strong letter coming from the centers of medicaid and

medicare services. this letter was sent on the 25th and released late yesterday. it concerns the california lab and details 5 deficiencies they found there. one that poses jeopardy to patient health and safety which is defined as likely to cause serious injury or harm or death to individuals. they cite that with blood work. other deficiencies involving their analytic systems and others with personnel. now they say at the time of this inspection they were simultaneously conducting their own review of the lab and already changed a few things. so this does not reflect the current state of the lab. they say we're still reviewing the report and we addressed many of the observations and we're actively continuing to take corrective action. they could face fines of up to

$10,000 a day and sanctions including revoking certification and also it's ability to get medicare reimbursement. so a lot of questions rising here. one other point is this is its newark california lab and runs 90% of its tests in arizona. >> a story that continues to develop. thank you. themes already emerging from tech earnings if your company makes money from pc or smartphone sales it's probably struggling. but if you sell a service winning on mobile already you're doing just fine. what that means still to come in just a moment. there's a lot of places you never want to see "$7.95." [ beep ] but you'll be glad to see it here. fidelity -- where smarter investors will always be. if only the signs were as obvious when you trade. fidelity's active trader pro can help you find smarter entry and exit points

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>> it's a busy week for tech earnings. we have western digital and those are kind of second tier. samsung and qualcomm already reported. those of course feeling pressure from a declining demand for certain kinds of phones. let's look ahead to the two big names reporting after the bell

today. microsoft and amazon. analysts looking for 25.3 billion in sales. a mixed bag of trends in this one. on the one hand enterprise spending looks weak based on intel and ibm results. we know pc sales are weak. by putting windows 10 out there for some users microsoft may have boosted it's cloud momentum for office 365 which has been driving the valuation. if those numbers look good the other stuff might matter less and for amazon, 35.9 billion in sales around $1.86 is what they want to see. the core business could be strong based on amazon's position in mobile. despite what ebay reported. the cloud business should turn in close to 2.4 billion in sales. if we get to 2.5 billion and above it gets people excited. this is a big cloud quarter because a lot of these retailers need extra capacity during the

holiday season. they turn to the likes of an amazon or a microsoft for them. that falls to the bottom line for those companies. we got a really interesting cloud versus cloud set up for this earnings afternoon with amazon and microsoft reporting their numbers at the same time in their big cloud corner. a lot of t you know, the nerds will be watching that. >> i wonder if the bar for profitability on amazon has been risen slightly over time. approximate they're now expected to show a little more give in the way of net income than two years ago. >> it's a good quarter for that. you tend to get more profitability overall in q-4 and then with the cloud in particular they're already showing operating profit in cloud. so i think it's a give and take based on how much revenue upside they show. how much of that operating profit people expect to see. we already know they're going to spend more on data centers in 2016 as they roll out the global expansion. as we saw from facebook if your top line growth is strong enough

investors are willing to take a little higher operating expense. >> amazon has made come mens about reinvesting in the business whether it's shipping or content and there's a lot of unknowns about what exactly that will cost and how it could potentially hit margins. >> again i go back to facebook and take a look at -- they said they're going to spend more than a lot of people expected but their growth was just so strong and they have proven to be responsible at showing profits once that growth pans out. you wonder if that goes through to amazon and what they have to say. especially given they already talked about how data centers for cloud they intend to roll out. >> this bit about sun dance bids today. reports of a music streaming service. the super bowl ad. earnings tonight. they're everywhere. >> they are. that stuff is all cost. >> yeah. >> we want -- investors want to see the money coming in the door. we'll see what we get. >> when we come back, shares of facebook as we said continue to

soar. one of the best days in the history of those sales. a couple of top analysts will tell us. and stocks giving up the early gains. but dow up 54. next thing to watch of course is the close in europe in just about four minutes. ♪ it was always just a hobby. something you did for fun. until the day it became something much more. and that is why you invest. the best returns aren't just measured in dollars. ♪

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>> mexico deported ethan couch that killed four people in a drunk driving incident in 2014. he left mexico city aboard a commercial flight for dallas. couch and his mother were arrested in mexico last month after they fled the u.s. >> jet blue will refund customers with those impacted by the zika virus or let them rebook flights. it joins a string of airlines including united continental among others that offered refunds. japan's economic minister re-signing amid a political funding scandal. he had taken bribes from a construction company. he admitted to taking the money but did nothing illegal. it was 30 years ago today the space shuttle challenger was destroyed in an explosion less than two minutes after takeoff. all 7 crew members were killed.

nasa will pay tribute later today. that is the news update at this hour. let's get back to squawk alley. i can't believe it's 30 years already. >> a lot of people remembering that day today sue. unbelievable. let's count you down to the close here in the u.k. in a few seconds. stocks lower in reaction to the fed statement. released just hours after yesterday's close there. also euro zone economic sentiment fell to five month lows. german inflation was in line but still below the targets. growth slowing to the weakest in about three years and with all of that, the banks among the biggest losers. a 7 year low after posting it's first physical year loss since the financial crisis. scrapping bonuses for the board. energy, the stock sector gainer lead by stat oil on hopes that oil producers will one day cooperate to cut production. >> and take a look at facebook right now up 14% t. company blew past estimates for its fourth

quarter yesterday. social giant hit 1.59 billion users in the quarter and shared the information that their mobile platform now makes up 80% of ad revenue. jason is an analyst and john is an analyst at cohen. welcome to both of you. i'll start with you because you have done a sum of the parts for a long time on facebook. and exactly what it's worth and we're asking the question given the growth that they still have available and given the fact that the portfolio model seems to be firing on all cylinders for them. what should facebook be worth at this point. >> it's a great question. fortunately unfortunately we have not changed our target. it was 130. it still is 130. clearly the momentum is terrific. the problem is we don't have enough information on how to think about instagram. so for example their revenue per daily active user was up 53% in the quarter in acceleration for

44% but we don't know how much of that was book and how much of that was instagram and you can make an argument that there's very high overlap between instagram users and book users. the problem is, you know, we heard for example that instagram can monetize today at twice as good as facebook on a per ad basis. the long-term thesis is still exact. we look at the monetization of google and monetizing at less than half that rate. the question is we need more information for the management of facebook. >> although john if the issue for a company is potentially one of your other products cannibalizing your core product you're doing well because you own both of them. the bigger question seems to be what -- at what cost is gook's momentum to the budgets for television stations and other media. do you sell stocks of companies losing to facebook and who are they? >> yeah, we actually talked about this on the show last

week. we surveyed 50 senior u.s. ad buyers in december. the biggest takeaway from the survey was that 90% of them expect their tv shift to digital to accelerate. who are the winners here? facebook is a winner. they expect the acceleration in 2016 but we actually think we saw it in 2015. we saw it last night. so yeah, i mean, i don't cover the media stocks. big media had a fall. you know, kind of midpoint of last year. but yeah, definitely we see facebook and google as big winners with this trend of tv shifting to digital. >> jason, is it in a way a good thing that we don't have a ton of information about instagram. information is always good but the fact that there's so much more room for growth both in these products that are not core facebook and geographically.

50% of ad revenue is kcoming frm north america but 15% of average users. as the middle class grows around the world facebook should be positioned to ride a wave of growth, shouldn't it? >> if you're talking about how you sell stock you're selling the dream. the me tricks we got last night were phenomenal. it was terrific top line and bottom line. so get some people excited about the company like they're doing. the problem just going back to it is you started with we value the sum of the parts and we're giving them up for preshriver value for instagram and we're putting a multiple on the earnings for facebook which is largely still today facebook and the problem is we model this and we run the risk of double counting. so is it entirely possible they could literally, you know, double the monetization by having them on instagram and

facebook and still have that relative value to advertisers versus other medium like google? it's totally possible. you get the best off both worlds. you drive pricing and you drive volume and last night that was the story they told and right now that's what investors want to believe. >> john you were pretty early in putting a dollar number on instagram. what would that number be now? and how would you characterize instagram in the rainbow of all of their now very large business units. >> no, probably 6 months ago we put a number of over 30 billion on instagram and we're there now. we haven't raised numbers too much in the past six months. we're looking for about 1.6 billion in instagram revenue 2016. that's double last year. and again going back to our ad buyer survey, instagram over the next two years is expected to gain the most share within any

of the social players and also just ad buyers that we talked to see instagram as a great source of inventory for facebook and i think that like sandberg put it pretty well. 98 of the top 1000 facebook advertisers also advertise on instagram and there is some cannibalization but over the long-term given the targeting, great targeting for facebook, they should benefit and for us, we basically we have facebook including instagram, their share of global digital advertising going from 11% in 2015 to over 27% by 2021. so we're expecting big things out of instagram and we expect the value of instagram to rise overtime. >> that makes the $1 billion, 700 million and change price tag they paid for it look pretty affordable. i'm wondering if you think that the other acquisitions that facebook has made, what's app, occulus, which one holds the

most uncaptured value right now? >> what's app paid $22 billion for it. i think last night mark zuckerberg was saying there is a plan for it. they're going to let the -- organically the business kind of develop and then generate a business model around it. we value it at what they paid for it. we'll give them credit because to your point they paid a billion dollars for instagram. it's one of the best deals in tech history. we'll give them some credit for it but investors will want to see something from them sooner rather than later. >> before we go, jason, alibaba reporting earnings today. the stock going negative. your reaction to the head winds at that company? >> sure it was a revenue and epsv. the issue is they got there on a higher take rate so the merchandise value is slowing and cut in half versus a year ago and given concerns about china

investors are concerned it's going to continue to slow. it looks like they can continue to increase their take rate. their take rate now is between a third to a quarter of what amazon charges so we think there's upside and you can see that in the numbers but on the call, you know, they were only able to say look it was an unseasonably warmer december quarter. and when asked like well how is january, they said well it's colder and that should be good for us and i think investors were looking for some more me tricks around the stability of the business given concerns about the macro economy in china. >> well, certainly the december quarter is the company's busiest so we'll see if the january quarter proves to be more fruitful for them. jason and john we appreciate both of your time this morning. >> thank you. >> and up next, it's been a volatile day for the price of oil. still above $33 barrel. we're live to explain why. but first, rick santelli, what's on your mind today?

>> 36 years. we're going to have bob with the 36 years dallas fed president for 14 years. our topic is going to be transparency. but, you know, looking out a window is fine. it's good and transparent. unless you live in a row house and looking at a brick wall. we'll talk about transparency after the break.

>> breaking news from the cdc. >> news conference going on now jointly from cdc and the nih prosiding numbers on the number of zika cases in the united states. the u.s. had 31 cases of zika infection among people that travel to effected areas. those people caught the virus elsewhere and travelled back to the united states. this virus spreads through mosquito bites. it's not expected they will be able to spread person to person. we haven't had local transition except for the territory of puerto rico. they're monitoring very closely. the who had a news conference this morning and said they'll have a meeting of the emergency committee on monday. they're trying to plum the

relationship between the zika virus and birth defects we have been seeing very greatly increase dintss especially in brazil. but that's the latest now. they're also working on vaccine can baits for zika. nothing near term on the horizon. >> we'll be talking about this more. let's get to chicago and give the santelli exchange. hey, rick. >> thanks, carl. listen, bob, welcome. 36 year with the fed. we'll discuss transparent city and listeners, viewers, in order to survive 36 years at the fed you have to amuse yourself a little bit. he wrote a poem on transparency. let's start out with it bob. >> this irritated my colleagues at the time. i said transparency is certainly a central banker cause but it reminds me too much of sausages and laws. i think translucents like my shower door is a good

compromise. it lets in the light but keeps out the fries. >> i like that bob and it goes right to the point i want to make. you can ask 8 people their opinion and all 8 can be wrong. the more important aspect is it was put forth for more transparency. transparency is a problem and taking it back may be an even bigger problem. you have written about that why don't you explain. >> it takes away your flexibility. if you start making these long-term statements and promises and they start to inhibit what needs to be done sometimes your stuck and i feel sorry for the guys that have to put dots down for the three years or so and circumstances change dramatically and they're stuck with those dots for 12

weeks or so and everybody else gets to upgrade their forecast on a daily or hourly basis and they sort of start ridiculing. i'm sure they'd like to get rid of those dots deep in their heart. >> why don't you think they will? why don't you think they will if it's a good idea. >> because transparency has become sacred. there's no debate about it anymore. everybody says the more transparent the better and to remove those dots would be a major roll back of a good thing. >> let me get this straight. transparency is kind of a bad idea but bad idea or not since they brought it out and never taking it away. that's like reagan's definition of government. >> well, it's hard to change

these things once you staked your reputation on them you have to sort of work around them and try to make them work whether they will or not. >> bob, i'm interested in five years from today the economy needs to be better. you think the fed is ever going to get to a point where it has enough confidence to do the right thing? we're out of time so quick final answer. >> yes, they're great people and smart people and they want to do the right thing. >> bob, thank you for taking the time. back to you. >> thank you so much. it is a volatile day in the oil market. jackie is live with more. hey, jackie. >> good morning to you kayla. certainly a volatile day today. short covering continuing here to boost the alley although we have come off of session high. rumors about a coorder mated production cut driving these prices higher. earlier this morning we have headlines from the russian

energy minister saying that saudi arabia posed to cut oil production by 5% per country in order to support the weak market of oil prices here but there's no comment from the saudis confirming this. we heard from opec before saying it would consider a coordinated effort but that's a very hard thing to achieve and we don't really have more specifics on it. also remember iran is an opec member. they're happy to get their oil on to the market now. they'll be very resistant to any production cut at this point. while the notion of this cooperation is fantastic in theory it's tricky to do in practice. the next scheduled opec meet as good going to be june 2nd. the market is discounting the fact that we'll see an emergency meeting although you never know ooech and even if russia and opec were willing to cut it what about here in the united states? that's another piece of this effort. we saw a slight drop in production. people were enthusiastic but it's so small it's not

encouraging at this point and we need more evidence here. the skeptics are saying it's a short covering today and it's a rumor driven rally. we need more evidence. >> up next, how can you make sure your voice is safe and secure? we'll do just that when squawk alley returns.

>> a lot of break news this morning. this one on iran. >> sanctions have been lifted on iran. making the pact a few moments ago. covers 118 new aircraft from airbus. includes pilot training, airport operations and other support. so the deal was just signed. back to you john. >> thank you, sue. >> voice technology could move beyond asking siri for directions. it could be your home car and banking information but who is protecting your voice from hackers and thieves. work on exactly that and announcing today that it's raised additional funding lead by google ventures. so how concerned should we all be about voice fraud?

gene is a partner at google capital and he is the co-founder and ceo. so thanks for being with us. want to start with you. when i first started kind of digging into this story my first concern was boy it sure is easy to trick the human ear and brain and sound like someone else. people sometimes think i'm carl believe it or not. how easy is it to reverse engineer and trick a security system. >> you have a phone number. there's an app by which you can spoof anyone's phone number. a lot of these when they go after women's accounts they increase the frequency of their

voice. >> how do you protect fwens people trying to do that? are there certain voice markers? i hear that there's more markers in a voice than in a fingerprint for being able to secure it but is it possible to reverse engineer even your system? >> no. so so far it's not been possible but, you know, you never say never but fundamentally what we do is what's known as phone printing so we have ability 147 different markers that allow us to identify the acoustic signature of any phone device anywhere in the world. so we can actually say this is actually carl calling from new york as opposed to a fraudster calling from a skype phone in niger nigeria. we're able to tell the retailer that this particular call is most likely a bad one. >> you can think about how this would be useful to banking and customer service calls and no one wants someone to call in and this can be deployed and said oh

yeah i would need that. >> the answers absolutely in fact if you look across retail e-commerce, any company that interact with consumers via the telephone has the need to be able to combat fraud using this kind of technology. so it has a very pervasive market opportunity. >> how broad is the opportunity for this? how far does your aspiration go? >> so we're big believers that it goes far beyond financial services and some of the more traditional markets that one might think about for voice fraud and so as i say retail big market. any market that needs to talk to consumers can use this type of technology. >> it has been really difficult for multifactor authentication to take off. we're starting to see it. you get texted a pass code when

you try to log in in an unusual place. do you think this voice layer has being an additional way to check someone's identity might make it easier for people to adopt multifactor authentication and make us safer kwond financial services. >> absolutely. you need to make it easy. if you look at all the newer devices between google now, amazon, echo they're all moving to voice because voice requires a microphone that's half a millimeter of size. so all of these smart watches are all moving toward voice and you can imagine right between your laptop, wean your mobile device, between calling into a call center the microphone is always there. it's something you have by a device and something you do by your behavior. how you speak and things like that. you can create a true

multifactor solution on voice. >> we'll see how the bad guys try to attack it but it's encouraging that they haven't succeeded yet. gene france, thank you so much for joining us. >> thank you very much. >> when we come back as amazon works on its own music subscription service, spotify announcing a major new round of funding. details on that in a moment. was engineered... ...to help sense danger before you do. because when you live to innovate, you innovate to live. the all-new audi q7. a higher form of intelligence has arrived.

spotify is looking to raise more money. after they raised the value at $8.5 million. they're expected to be adding convertible loan notes. >> they're going to be meeting with investors in london. and come at a discount to the value of the shares. what could that do to the company's valuation? we'll be reporting on that. >> for all of the sense that we get of the competition or the odds it's up against still one of the best funded entities in europe. certainly in the eu. with all the money raised overtime.

finally this back and forth action has put pressure on the afternoon. we had 200 plus moves in the dow. up or down for the past four sessions. let's get over to headquaters. the judge and the half. >> carl, thanks so much. welcome to the halftime show. let's meet the starting line-up for today. joe is here along with josh brown and pete also on set for the full hour is kate moore. she's the chief investment strategist at jp morgan's private bank. our game plan looks like this. the fang trade, our experts on facebook's big blowout and what to expect now from amazon and why the hottest trades in the market may not be dead yet. under armour rips. that company's strong quarter and optimistic outlook means for the stock and why one bear still isn't convince. the surge of crude oil higher on