>> this is cnbc not -- >> yeah, well. i'm for it all, baby all right. thanks carl, back to you. >> thank you >> merry christmas >> jane, that was great. what a great discussion. our thanks to barry and alex and jane we will jane wells good morning, everybody. it's 8:00 a.m. in california and 11:00 a.m. on wall street and "squawk alley" is live. >> good tuesday morning. welcome to "squawk alley."

i'm jon fortt withing canni car. google is over hot water in the power over the diblgtal advertising market and now allegation that's they've been work together quietly to maintain that power they may not be dead after all reuters out with a report saying that self driving car may be just three years away. julia, to talk first about this advertising thing, google and facebook that has to be what comes to mind when you by this two powerful companies potentially even talking about the power on regular basis. that's a new potentially significant rink will in this conversation about big tech. >> certainly and big tech is really facing so

much scrutiny right now from an antitrust perspective. we think about the way that google dominates search and the way they have so much power in terms of youtube they control the machinery and the way so much advertising is sold online. the idea that facebook would be committing to spend half a billion drarz going through that, going through that machinery, just really speaks to the fact that the digital duopoly, these two kbhcompaniesr not just dominating the ad market, carl they're working together to do so. >> as for apple, stock near a four month high. closer to $133 now more discussion about why reuters might have gone with

them at this point maybe they're trying to lied the market a little bit. lots of stuff to kick around there. >> this would be huge. we have to have gene munster on. he predicted apple television for a long time. it never quite arrived is this apple car going to be another apple television and that is since they pulled back from the full ambition i don't know the rumors on self driving, let's spend more time there. he had writes the big technology newsletter on substack and author of always day one how the tech titans plan to stay on top forever he joins us now. also a cnbc contributor. what is your take on the resurgence of this apple

automobile rumor and exactly how many regulatory hoops april wol have to jump through in order to put a car on the road. >> to me, it comes down to culture. apple viewed this car similar to the iphone rebuild a beautiful design first and then kind of work the technology in backwards. it dn the quite work out as planned. i spoke with ai engineers on that project who said they have to bury the sensors. because apple thought they looked ugly. and that limited the amount of data that they were actually able to collect, hampering the progress of the project. now we're looking at somebody that is four years out f apple views this as an ai project instead of a design project, then they're in good shape there are signs they're doing that which is why i think the news emerged now you're in better shape than we were in the past if you're apple.

>> what is interesting to me about this, too, in the context of this month is this purchase that the peloton just made of a traditional exercise equipment maker for manufacturing capacity and i suppose also for tooling expertise. if apple is really going to build a car, look at how cheap the automakers are compared to the tech companies i wonder if it makes sense to pick one up. not because they want to sell chevrolets, but just because manufacturing capacity, some engineers and the ability, you know, a dealer network to roll something out quickly. >> no doubt. they have the cash to do it. and peloton that you mentioned just surfaced ford in terms of market cap last week so sort of goes to show you that the value of a car manufacturer right now. but for apple, look, the thij is manufacturing of the cars, the distribution, that's the easy part the hard part with self driving which is what they're aiming at is getting the ai technology

working to the point that you can put the cars on the road and not have them hit and kill people and i don't think apple is at that point right now so if they focus in that direction, they're going to be in better shape. they have so much cash that figuring out distribution, figuring out manufacturing, that's really down the line. if they get to that point, that's a really great problem to v that means they solved the ai problem. >> alex, you say manufacturing cars is the easy part. but the reality is that apple's never done this before and you just said that apple can be so focused on the design that that could sort of get in the way of the process does it make more sense for apple to think about this as an operating system that they could deploy much more broadly than if it's actually making the own varying, beautiful, i'm sure very beautiful i car or whatever you call it. >> i think that will be a great idea that just underscores how difficult the machine learning challenge is to be able to get a car on the

road that can see what is going on and make decisions on it so it's extremely difficult. google is working on it for a while. maybe they're making progress there. but we haven't, you know, seen their program go operational yet. uber invested heavily in this. it hasn't gone the way that, you know, it was hoping for. so, you know, if apple actually decides that the focus is on ai and the battery only and everything else gets outsourced, i think that's good. because it means that they're letting go of that precious design focus that held prot jth project back in the past it is good for the direction of the company. and give me hope this thing can roll off the assembly line in 2024 as opposed to what i think now which is like, you know, something that might, you know, increase the valuation a little bit. i don't really see much chance of it actually becoming reality any time on the time frame that they're putting forth. >> you know, alex, the knee jerk, the market has this craving to look at everything through the lens of well how is it a threat to tesla

2024 is a long way away. and i wonder, do you think about where tesla will be at that point of the game? >> if i'm elon musk, i'm looking at google. i think they're real threat who it comes to autonomous driving technology could apple build a beautiful car? potentially. i want to see meaningful progress as opposed to rumors and focus on the battery which is what the reuters report really said. they said the battery is like seeing the iphone for the first time but if you build a self driving car, i want to know that sensing technology is working. i want to know that miles driven autonomously are going up versus

down >> frankly, alex, i don't think anybody, not many people would be buying an apple car because it drives itself i think the allure would be in the design, the brand, the electric nature of it, all of that cache, integrations with other apple stuff. i'm going to talk a bit about this jedi blue thing this is from "the wall street journal. google did respond the ad tech claims are meritless. yet, he has gone ahead in spite of all the facts we invested in state of the art ad tech service that's help businesses and benefit consumers. that is google's statement on this this does change the conversation about google and facebook if there is any indication that

the two work together on any sort of approach to the ad market that led to benefits to both >> no doubt. by the way, i think the name is hilarious. jedi blue. i just kind of thought that was hilarious. in terms of the case, i think that when you make attorney generals in there, it's been, you know, dozens of them have looked into facebook and google. when you get them combing around and having an opportunity to look at your internal documents, there's a chance they'll find something damning. this doesn't look good for google or facebook in "the wall street journal" report, they talk about facebook winning a preset number of auctions facebook and going. >> caller: say thgoogle can say did nothing wrong. they can say that the claims are baseless and they want us to believe that >> alex, want to read facebook's response to this article they say the processes and

agreements for bidding advertising promote choice and create clear benefits for advertisers, publishers and small businesses any allegation that harms competition or any suggestion misconduct on the part of facebook is baseless alex, i think it's interesting that they're focusing on the benefits to small businesses and also to consumers. of course, the small business piece has been crucial to facebook's growth and it's also crucial to their antitrust defense and this battle that they're in right now with apple. how do you see this playing out in terms of facebook i mean this is part of the google lawsuit how is it going to impact facebook >> yeah. it could absolutely spill over into their case. i don't see any reason why it wouldn't end up making it to the ftc and the state ag wass. but you're right it is interesting. they're going with the small business, but what about some substantial reputations of what we're seeing in this report? i'm not saying facebook and google did that i think we need to wait for

the facts to come out. i mean it's a pretty weak defense to say we're helping small businesses and that's why this isn't -- this isn't right i'd like to hear more discussion of the actual substance of what the attorney generals are bringing >> yeah, alex, is this small business thing it is replaying itself snout it's t itself out it's the hard-working americans. it's the feel good phrase that all the companies are rolling out, you know, we're helping small businesses or don't you hurt small businesses. nobody wants to hurt hard-working americans i mean, does it really give them cover, you think, politically or no >> i think it's underrated how convincing of an argue thment small business argument is going to be. are you going to buy an ad from

anetwork or cheap, well targetted advertising through a network like facebook or search engine like google the google ads really work well. >> i think you're right, there is a limit to it does the help foe small business going to balance out the nefarious business practices if they're if violation of antitrust laws, we're helping small businesses defense is own going to get you so far. >> all right alex, writer of "the big technology newsletter" g to hear from you >> great to be with you guys >> the chairman and ceo of sewnies pictures entertainment is coming up after the break stay with us - [narrator] at southern new hampshire university, we're committed to making college more accessible by making it more affordable, that's why we're keeping our tuition the same

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films in theaters next year, all 17 of the films at the same time they make them available on hbo max. we saw them shorten the window at home distribution disney announcing changes as well how is sony reacting to this how are you going to handle will your releases next year? >> we're not really changing course to a great degree with he this that i windows will become much more flexible. in the past, you know, some will do better with a shorter window. some movies do better with a much longer window just a couple examples, a couple years ago when our first film came out, it was released in october. we wanteded to get it into the holiday season for home entertainment release. we did we had had a shortened window. jumanji went foreever in

theaters it depends on that film. >> does that mean your negotiating to shorting the window can you imagine doing a release like warner is doing is. >> i don't think we'll be in the day to day release business, no. i think the economic model for very big budget movies, films, requires the window that's are in the flow now. every film we'll have an individual negotiation with the exhibitors we think a 30-day window is the best to allow us to advertise our marketing over the two windows. so we think that's the way to go >> so what's going to happen next year though if you say have a 30-day window, then you have other films, big movies from warner brothers

going straight to hbo max, disney doing that with the films and disney plus. all of that at home entertainment is huge competition for the movie going experience plus you have the fact that a lot of people aren't going to want to go to theaters because of covid-19. how much are your releases next year going to suffer from that >> we don't think they will suffer once theaters are open and have a significant number of seats available to sell, we'll be fine you look at this broadly, julia, for 18 months, there's going to be a blockbuster movie not just from us but from every studio. it's going to be great, great attraction for consumers it's the number one movie in the history of japan china box office is doing fine once theaters are open, once people feel comfortable to go to theaters, safety protocols will be strong and the vaccine is in

the marketplace once public optimism begins to take hold we think theaters will be back i'm hoping -- we're hopeful that april and may is where theaters begin to open in a substantial way. >> i'm glad you mentioned asia you signalled a weak opening how reliable of a tell is china right now? how much is riding on maintaining that pipeline as biden takes office >> china -- china before covid-19 was the second biggest theatrical market in the world eventually, we'll be the biggest in the market in the world one thing that people don't really -- i'll use the word understand that, is not the right word, but the film business is becoming international business 35 to 40% of box office generally is domestic now.

many countries are building out theater chains in the emerging markets. we see that as the future. china will be a big market obviously, the function that's are in place right now are impacting things in china including film releases. "wonder woman" didn't do as well as expected. it could be a few things reviews from consumers and critics were not terrific. but japan, again, game sleigher is the number one film in the history of japan we will distributing that film in most of the world once -- once it come out in japan and we're looking forward to that being a big, big boom for us as well. >> julia mentioned the compression of the window. there are some reports in recent weeks that marvel, for example,'s exploring new talent deals where they're allowing for some flexibility to give the

studios more of a option alt, i guess. is talent ready for that after the warner brothers announcement, it was a big deal. the real benefit has been the number of incoming calls from talent and creators and actors, from directors to us saying we want to be doing business with you because we know you're a theatrical distributor and producer so that worked very well for us. >> look, these people work on the movies, creators and directors and writers work on the movies for years to get them ready for the distribution and, you know, if they're expecting it to be theatrical, they want it to be theatrical. that's what they want. that's where they see the biggest return

we're going forward. >> tony, you talk about the importance of theaters and we were just talking to someone yesterday about the theater business and the idea that it might be allowed for in the future content producers to own movie theaters i can think of no company better positioned than sony under that scenario to have sony movie shot with sony cameras shown with sony projectors and a sony theater with sony ps games for people to play while they wait is that something that you and sony have thought about? >> look, we talk about ways to integrate all the various parts of the sony corporation. we just had a conversation yesterday about many things that you talked about you know, we have no specific

plan yet but we have a program within the company called one sony. it has been terrific for our business we've seen lots of things happening in that regard for instance, we had a movie which we shot completely during the pandemic and will be released back here based on sony play station ip. we have three films in the works with sony play station and ip. and we have seven television projects in the works with play station ip so, you know, you'll be seeing a lot more integration of sony companies together in the future >> tony, i have to ask if you think it's necessary to add another company in that mix. this are been reports for years that sony and mgm would be a good fit mgm just hired bankers reportedly to look at sale there. do you think that a merger would mgm would make sense

do you think you need more scale right now to compete with the other studios that are vertically integrated with the streamers? >> we set our strategy to be a provider to all platforms and it's been working extraordinarily well we're having a pretty good year this year even in light of the covid-19 world but, look, we set a strategy that being the first piece the second piece is we're working on establishing niche oriented, very narrow services a business we bought three years ago is doing extremely well. we announced an agreement to purchase another company that service, that service automation is doing really well. he would bought another service called pure flicks so we're in the streaming business and they're profitable and we're going to move forward

with a couple more we're very happy with our str strategy and position and it's paying off really well right now. >> so we'll take that as a no comment on my question about a potential mgm deal >> good try. >> we appreciate you joining us. it will be a very interesting year ahead for the movie industry and we hope you'll come back and talk about it more. >> absolutely. look forward to seeing you soon. >> all right thank you, guys. meantime, watch peloton today. near $164. all time high. the key takes it to $185, the target that is you can read why on cnbc.com turn on my tv and boom, it's got all my favorite shows right there. i wish my trading platform worked like that. well have you tried thinkorswim? this is totally customizable, so you focus only on what you want. okay, it's got screeners and watchlists. and you can even see how your predictions might affect

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welcome back, everyone, i'm sue herrera. two of the nation's top health officials received their covid-19 vaccine shots dr. anthony fauci and hhs secretary alex azar both rolled up thur sleev up their sleeves, are part of the administration's efforts to demonstrate the safety the washington football team paid a former employee $1.6 million, part of a secret settlement in 2009 after they accused dan snyder of sexual misconduct while on his private plane. the allegation has been brought into an on going legal fight between snyder and the team's minority owners. nbc news reporting connecticut education commissioner cardona who started his career as an elementary schoolteacher is president-elect biden's choice to be education secretary. and this north carolina elementary school principal popped up as an elf on the last

day before the holiday break saying he just one of the many principals and teachers who are trying to make things exciting and magical for their students every single day no small feat this year, carl. i'll see you in an hour. back to you. >> they've been through a lot, as have we all, sue. >> shares of luminar surged yesterday more than 27%. up goen day as the companies that could provide the technology behind this apple self driving car that is rumored to be in the works by 2024 trade higher with us this morning in an exclusive interview is the ceo of luminar technologies austin russell. thank you so much for coming on the program. good to see you. >> thanks for having me. >> is there -- i'll ask you point blank, is there any intelligence of your own that can you report to what reuters has reported >> well, i think -- you know,

clearly when people report on, you know, the largest company in the world, you know, getting in the game, there is going to be no shortage of interest. we can never comment on this bl we're working with someone or not. but what it comes down to is i think there is no question that there is huge interest from the companies across the face, you know, in the consumer world and beyond when it come down to the autonomous driving game. you know, being able to provide next generation solutions, so, you know, we have our part in that ecosystem we have built this from the ground up. there are economic requirement that's are needed as the first and only company to make it into production vehicles. so that's where we struck major deals with daimler, mobile and just in the last six months or

so alone, it's been really exciting to get out there and what it comes down to it for passenger production vehicles, thats where you need the economy to scale what it is right now that is leading us to an inflection point if in fact that's where we are. is it something about the progression of the innovation? is it about costs and scale? >> there's no question that there are a few different things going on in the industry there is a revolution that we've been seeing on this side of things here. you have seen with the tesla of the world and what changed

there. they make the awe sutonomy practical. so what comes down to it, that is absolutely it you know, to be able to have the ability to get your hands off, eyes off, you know, read a book, use your phone, work on a laptop, take a nap, et cetera, starting on highways and then expanding on the way out i think that is super valuable to a lot of people in addition to increasing vehicle safety with this kind of package that we have. >> so austin, i have a question. you can't tell us if you're working with apple or not. i understand that. but does seem like there are two different categories of cars apple might be building right now. one is self driving car, that's in a space like this

certain lanes in cities. something more controlled. and then the truly awe monduton self driving car like a consumer reading a book chf the categories do you think apple is working in and how possible is it to get to that much more ambitious version of a truly autonomous consumer vehicle? >> yeah. so i think, you know, at the end of the day, the really valuable stuff that you can build and i think this is part of what, you know, the specific report said is, you know, you have to -- if you want to build something that can actually go into production, you really need to work directly with the oems building cars for, you know, decades, centuries i think what it comes down to it, you know this is where, you know, the right partnership model comes into play. everybody has a niche in terms of of what they do obviously, the apples of this world have incredible ecosystem of things that, you know, can be

leveraged whether it comes to -- when it comes to the oem model and that side of it, you know, obviously, they have the specialty with what they do. you know, and then, of course, we work with all these different oems to be able to integrate this technology, starting in the development phase and then moving into production with some of the other programs that we got out there with so, yeah i think when it comes down to it, you know, if you want to have something viable and viable to a consumer, you need the huge economies of scale but that's really our core focus, our niche in terms of what we have but i think that, you know, calling it a niche, but it is going to be driving all the volume in the industry that's why we've been so focus on it. >> so give me a sense of the time line. if this apple car were to come out in 2024, maybe 2025, what else will already be out there by then?

>> yeah, so there will be, you know, autonomous cars powered by luminar at this time you know, when it comes down to it, that's what we warrant yes, that absolutely will be out. it wh it comes to the other programs, some have been more or less public with their time lines, mobile, 2022 daimler hasn't specific lay announced their time line at this stage. but pretty much all the programs that we're working with are generally between 2022 to 2025 window for the production time line so that gives you kind of a sense wof where things are. i think absolutely a big fan of people that are getting into the game. >> austin, elon musk has been

blunt. he said that is a fools errand so there is this idea that computer vision is going to do much of what lidac do. give us a sense of the road map that you have for lidar technology that is going to keep it ahead or take it beyond what computer vision aided by ai and other systems are going to be able to accomplish. you know, the real challenge is when tesla designed their, you know, the autopilot suite, you know, five years ago there is no lidar that is available for production that can easily be put into that

at that point. you diggier self deep near a hole when it comes down to this it, this is where all the companies, a huge group of them is allowing you to go from assisted driving systems and now into the early a autonomous vehicle you don't need a lidar system for someone in the wheel and zoontly paying attention, eyes on the road. you keep your hands off the wheel, eyes off the road and something that can actually be dramatic and safer. when it comes down to it, they did a whoeld understanding of everything around you. it is originally powered until tesla systems here they are heavily down and it is mobile eye you know, they pretty much dominate the assisted driving space in the industry.

when it comes to autonomy, we're the only ones that met that required spec. when it comes to a lidar site and having the scale, that's why they partnered with us so, yeah, that's -- that's why it's absolutely critical, you know, not on the autonomous side and improving vehicle safety altogether >> well, the space is heating up as we speak. and we look forward to talking with you a lot more. appreciate it very much. thanks for coming on >> thanks for having me. >> carl, i can't wait until i have a self driving car. up big this morning after announcing they'll spin off video shares up more than 13% on that news. we're back in just two minutes

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we got stocks near session lows dow near down 163. maybe on a reuters headline that just ran quoting sources saying the u.s. government will not impose covid-19 screenings for flights from the uk. meantime, cdc saying there is no evidence to suggest this new var yent in the uk is any more deadly we'll watch. this meantime, the treasury department is the latest victim to disclose they were part of that massive solarwinds cyber attack joining us this morning is one trust co-chairman to talk more about what this may mean of course, sir, the

cybersecurity needs of over half the fortune 500 just yesterday closed a $300 million funding round valued at over $5 billion. allen, welcome good to you have >> carl, glad to be here thank you very much. >> i mean, i guess at this point of the game, since at this point of the game, there's so many headlines flying around about severity and breadth of the hack, what key answers need to be answered first as we move forward here? >> security is a tapestry of different products and the networks have been built over many, many years and we're finding we really need to operationalize security and modernize all of these so that they're built for modern techniques that the hackers are

using. one trust is in the adjacent space of privacy and one of the challenges is as you try to build up the security people, will you invade people's privacy in the process we're built around helping companies understand their privacy, where they stand in that all companies are thinking about the trust and the ethics and the way they project themselves to their customers and to their employees, and this is what we see is a real shift. it's not just about security but it's about how do you secure all of this and still maintain privacy and ethics >> and that's going to be a long and tortured balancing act i wonder, some ask why should these names, these cyber security names go up in the wake of this news when a lot of it was because of a hack that they them selves were a victim to in some degree? how do you answer that question? >> if we could just solve this problem, we would.

the problem is we need to invest more in this the adversaries are getting smarter. it's not like the winners in the space are winning and the losers are losing they're going to have to get better and the way we do that is by expanding these capacities. these companies are going to get bigger, smarter, they're going to employ more people and this is going to become more and more important to companies as you just can't operate without a good security infrastructure, you can't get attacked by ran m randomware companies will spend money to solve this problem >> there are things in particular about this hack that really get under my skin i'm hoping an expert like you can respond to one is it's a network level hack that respond to updates that seems to be the kind of thing that people have been hammering about huawei for a couple of

years now and it was not perpetrated by the chinese so far as we can tell may have been but all indications so far is that it was the russians first, can you give a sense on whether it makes sense to look at a particular country when you're looking at building up security capability versus looking at, as you say, operationali aalizing security general? >> if you only go after one country, you're only going to start playing whack-a-mole you have to look at this in a very who wiholistic way we have a lot of information, a lot of intellectual property we really can't take a country-by-country view. we've got to understand each country and their methods and their tactics and create broader strategies that protect our networks and realize we've got

to both be worried about not only the outside attack but we have no idea to what extent any of these might happen inside we have a lot of foreign nationals, we have people working in these companies i'm not saying that any one of these is from the inside but inside where they say it's a little bit like looking in your roof it's one thing to try to find a leak from the outside looking in it's a very different thing to find a leak when you're on the inside and you can see some light and see where some of the breaches are any companies need to work about both of these methods of being dealt with by foreign actors >> it's interesting. a lot of your customers are national and especially overseas in europe we've seen much more stringent privacy law. as we anticipate more stringent privacy laws here and changes to apple's operating system, how do

you see privacy and cyber security insectitersecting >> in many ways they will. one thing people want is privacy by design. one of the things you don't want to do is let private data out to other parties. and, you know, we know of a hospital where they had -- they actually released their entire patient database to a fund-raising organization that got hacked, things like that i know i got so many letters and emails from people i didn't even know knew anything about me. so privacy by design and knowing what data should be shared, knowing that your third party and vendor community is going to get hacked and you can restrict the amount of data to only need to know, these kind of things will start to protect privacy and personal information in a better way

we know there's going to be hacks. what you really need to do is limit the effect of those hacks. >> indeed, yeah. this one sort of makes those credit card number hacks of a few years ago seem pedestrian. hopefully the united states has the discipline to get over it. thanks so much, alan good to see you. >> appreciate it thank you. >> as we go to break now, take a look at shares of secondhand luxury good seller the realreal, up 10%, up for a sixth straight day. it's been rated outperformance it's said that the realreal is a growth story not sure if it would end the year in the green but it might back in a moment healthcare benefits through a humana medicare advantage plan. call the number on your screen

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hello. [all] hey... there he is. workday, the finance, hr, and planning system for a changing world. ♪ch-ch-changes just want to take a look at some stocks making big moves today. shopify and etsy big winners shopify up over over 4%, etsy up

2% what are you looking at? >> i'm looking at peloton, also looking at deals with fitness cente centers. >> watch square. we got target price increases today. this name was $32 in march closing in on 238 today. let's get to the judge >> carl, thanks so much. welcome to the half time report. front and center this hour, apple's new frontier as the company says it is on the way to producing a self-driving vehicle in the years ahead joining me for the hours are stephanie link, josh brown, jim