apple! another apple! do another apple! do another apple! do another apple! [ laughter ] do another apple! ther apple. >> i'm sick. i want to stop. >> seth: and that's why you'll never be chris kattan! [ cheers and applause ] you're an imposter. and finally, ladies and gentlemen i will say of all the distinguished guests we've ever had here on "late night," the next may be the most prominent only because he's added nothing but sheer deliciousness to our lives. please welcome scott flynn, the inventor of chicken tenders. [ cheers and applause ] everyone, everyone stand and give scott the ovation he deserves. [ cheers and applause ] truly an honor. and tonight because of scott everyone in the audience gets chicken tenders. chicken tenders for all! [ cheers and applause ] thank you to all our distinguished guests. we will be right back with kiefer sutherland. [ cheers and applause ] ♪ ♪ pepsi wild cherry. explosively cherry. from garnier fructis. blends that totally transform hair. in the shower... marvelous nourishes. when you style... marvelous protects. and shine... anywhere, anytime. find

yeah, the apple-- the apple must have sin funny to you? the apple muffin is a clown to you? is that it? what's so ( bleep ) fun bethe new york state apple muffin? that was my favorite part whole debate. ( laughter ) we go now to our senior state snack correspondent jessica williams live outside the capitol building. ( cheers and applause ) you were there, obviously, for the entire debate. >> yes, i was. >> jon: what was the feeling inside the chamber? >> it was contentious, jon. and not just on the floor. there was also this dramatic outburst when the gallery. just take a look. >> jon: certainly. >> this particular situation-- ( gavel banging problem (. >> i'd ask the sergeant to remove those who are making noise in the chamber right now. >> jon: who-- who was causing this disturbance, jessica? >> there is only one group that stages radical protests to disrupt the proceedings every time yogurt-based legislation is on the table. it's code pink, jon. >> jon: thank you, jessica. jessica williams, everybody! i wanted to give you-- i wanted to give you the update. in the end, the

apple, apple, apple, google. ere is more -- >> like very, apple, apple, apple. >> like very small-cap. >> twitter. frenzy on thea equity markets. >> coming up for freakonomics co-author steven levitt out the new book with steven dubner. our twitter question of the day -- how about the new york rangers? ♪ >> good morning, "bloomberg surveillance." let's get started with our top headlines this thursday morning. >> the senate may vote as early as next week on stanley fischer's nomination to be the vice chairman. he is one of three nominations for the board. all three have been approved. senator paul rand has produced all the nominations. -- rand paul i think. turkey, minors are dead in the worst mine disaster ever. rescue crews are still trying to reach 100 coal miners. they're still trapped underground. they're being slowed down by fire and gas. the in a chill flails, montreal canadiens -- nhl playoffs, montrÉal canadians. they now face the new york rangers in the eastern conference finals. game one is saturday. tho

tight. >> reporter: now, there's an obvious comparison to rivals in cupertino, but it's not apples to apples. appletes about $20 billion in sales per year. microsoft doesn't break out those numbers. some interesting numbers we can tell you about. the customer growth partners, a retail research firm, says apple generates about 4,500 in sales per square foot. microsoft, under 500. the challenge here for microsoft is that a lot of consumers still associate it with software, not necessarily devices. so microsoft has challenges ahead. but maybe opening up this retail store is a step in changing that perception. guys, back to you. >> josh, it's jon steinberg. what's the difference now from when in 1999 microsoft, i remember, launched a retail store in san francisco, is that they have hardware now? has the world changed? there's more ecommerce now, so why would this work now? >> reporter: i think certainly you've seen new products, right? so satya nadella has put the strategy forward. microsoft saying they want to be a player in consumer devices, they want to take on apple and google. he has products to s

apple and google started at the same time. apple obviously started in the 1970's but then steve jobs got fired from the company in the mid-1980's and apple went through a period of say 10-15 years where its fortunes declined and it wasn't until 1997 when steve jobs returned that apple's fortune began to rebound. when steve jobs came back apple had 90 days of cash left before it was going to auger in. and so in some respect you could say both companies started right around the same time. >> host: well you write that the apple-google corporate bottle is quote the defining business battle of a generation. what do you mean by that? >> guest: i think one of the things that make silicone valley so interesting is that most of the companies are started by their founders. as a result, whenever there are fights over things, the fights get nasty and personal quickly because each of the companies has been built from scratch by the person who is running it. so steve jobs takes everything that happened to apple personal and larry and sergio takes everything that happens to google personally and mark zuckerberg takes everything that happens to facebook

apple may really be after. >> dr. dre may be most famous for his music but it is his beats by dre headphone that is could make him the richest man, that is because apple may buy it for as much as $3.2 billion. if the deal goes through it will be the most apple ever paid to acquire the company. so what is beats? the company makes high end headphones that already retail at apple stores for billions. in january they launched a streaming service that competes with apple's itunes radio. it may be more about the talent. namely dr. dre's co-founder, jimmy ivine, one of the earliest adopters of new platforms. he reportedly is in talks with apple in a creative role. >> if you take it a step further and think about the -- what it adds to their management team it starts to make sense, albeit a very expensive hire. >> this typically builds its own hardware internally rather than acquire it. talent or not, analysts are skeptical. but beats did put in a reported $1.2 billion in revenue last year. and the brand is not just recognizable among consumers, it is even considered cool. >> i think it is very dope. >> i think it is very exciting news. apple is a great company. and the combination of the two will be awesome. both companies. >> i just hope that doe

apple never done anything but ear buds. >> i find myself in an odd situation. don't you think there's a hip-hop african-american cool about this that apple may not have achieved in other ways? if you look at apple's $350 million in this country alone last year. this acquisition is peanuts, 10%. >> it is. >> apple is a global brand. it doesn't need to acquire hip-hop african-american cool. >> apple does things their own way. everybody including me wanted them to buy drop box, twitter. they do high-end hardware. this products are high margin. they have 60% of the over $100 headphone market. it's a perfect -- >> force about -- foibts forget about the headphones. >> these are not high-end chic. they have plastic head phones that cost a lot of money. >> the blue tooth speaker that i possess, which i don't like the look of, but the music quality in my opinion is spectacular. who knows if there's ip, intellectual property. >> the three they sell in the apple store, the beats is not the best sound quality. >> these ears, i know sound quality. >> john steinberg we should know predicted several weeks ago after last quarter that apple was going to make a big acquisition in the consumer products space. was t

that's why it did a deal with apple just last month to sell subscriptions through the apple store. applebviously has a lot -- >> my theory here, peter and natalie, is what they'll do is sort of the cell phone and contract deal. you buy a two-year contract to buy -- to subscribe to music through appearing, they will throw in heavily discounted beats headphones for you. and that would be the formula. is this a tacit admission that the era of downloading, of itunes as a music platform is ebbing or maybe even over? >> we've already seen the writing on the wall there. this is the first time in years we've seen a decline in digital download, so i think they want to absorb not only the software, but also the deals, because they're a bit behind in making those deals. steve jobs never wanted to do streaming -- >> that won't help. that said the label -- there's some debate about that, but from the people i've talked to they'll happy to do it, but the deals don't carry over. >> what about apple do about the audio quality of beats headphones? they're not necessarily regarded as much more than a fash

price apple in the market apple is a very very strong brand great goodwill value they're able to command a much higher price for the same or sometimes even inferior products because they're apple how long they can sustain that will people been asking that question since the mid one nine hundred eighty s. and they've had their ups and downs in that time but the apple brand has really continued to grow and from then on and they've managed to keep a company that has a smaller overall market share but target's really the highest value customers and that for apple has proved to be a very good very long standing business strategy that i don't think is going to erode in any anywhere in the near term i think apple's biggest problem is going to be what is the next business to come for it i think the i phone will sustain for five more years maybe even longer but what's going to add another ten billion dollars to apple's top line i think that's the question people have to ask is apple now microsoft are they now grown so big that their ability to add a new business that moves topline is extremely difficult and that you mention google. according to tear down dot com google glass part the p

. >> thank you leah good morning everyone i want to say i want to have apple apple for daniel silvermane've had other leaders but thank you very much for the bike coalition one thing we did in the richmond we came up to polk street but improvements like this are needed throughout the city and mayor ed lee has strong support we need to increase the funding for bikes lastly i was a student at the uc davis and as what we look at another city and counties cities our city can't be left behind whether the mta or other agency we need to make sure it's a biking city for everyone thank you. >> (clapping) >> thank you supervisor mar. >> i'm thrived next to bring up our supervisor from district 10 yesterday we're honored that the bierlg coalition joined by mr. levy restoring more than 40 bicycles we'll be giving out in the bayview hunters point so welcome supervisor cowen. >> good morning and happy bike to work we had an opportunity to continue to build and bring more bikers here it's critical we give a lot of rest and conversation insuring that the bike community is as difference as any community

apple being back at $600 considering the fact that they have not come out with basically a new product for the last 2 yearswe've been talking about the apple tvnon- existent. that's pretty good for applely overperforming the market. i'd rather be buying at a pullback to $560. >>what do you think about the market? where are we going here? >>i think that we're going higher for sure. we are in a raging bull market. we've been in a raging bull market for 2 ½ years. there's only 3 ways to play a raging bull marketaggressively long, moderately long, or flat. the market did roll over yesterday but we didn't see that pop in the vix at all. the vix is still trading around 1480 in the front month future. so until the vix gets a huge spike or that 10 year that i talk about all the time gets above 3%--i think the pullbacks are bought. i did lose money yesterday. but it was kind of a routine selling day. i think throughout the course of this week and next week we will continue to move higher. >>thank you andrew. >>thank you. coming up tomorrow: does the amazing spider man have a bad case of franchise fatigue? and will hollywood find a cure for the common film follow up. that's it for now. from all

apple and google arguably started at the same time. apple, obviously, started in the 1970s, but then steve jobs got fired from the company in the mid 1980s, and then apple went through sort of a period of, say, 10 or 15 years where its fortunes really declined steadily. and it wasn't really until 1997 when steve jobs returned that apple's fortunes really began to rebound. in fact, it's, i guess, pretty well known among people who pay attention to what's going on in the valley when steve jobs came back, apple had about 90 days of cash left before with it was going to auger in. and so in some respects, you could say both companies started right around the same time. >> well, you write in your book, "dogfight," that the apple/google corporate battle is, quote, the defining business battle of a generation. what do you mean by that? >> guest: well, i think that there have been, one of the things that make silicon valley so interesting is that most of the companies here are started by their founders, and as a result, whenever there are fights over things, the fights get nasty and personal very quickly because of each of the companies has been built from scrat

apple's future? >> i wouldn't say this is important to apple's future. it's about a month's worth of apple's the think the way apple is looking at this, as an interesting experiment in adjacent business. not so much of a big bet on the furor the brand. it's not a tremendous bet for apple. beat already has a billion dollars in revenue and it does have a stream of music that could be interesting platform for apple in the future. >> we see tech companies buying other companies. is apple late to the game in this regard? >> reporter: apple is late in the sense that other companies are making more acquisitions than apple has been in the past few years, but i don't think it means that apple has missed out on significant opportunities for apple. the news comes down and all these folks who have strong opinions come out and explain about it. so it shows you the risks that tim cook of apple face that other ceos don't face when they're expected to go out and buy things. mark zuckerberg goes out and spends $19 million on an app that no one knows how it will fit into the business. it did cause a flap but

apple back. the ipod on windows is when the growth accelerated on apple. this really does show apple trying to fix a problem they have got with their old business, not developing new business. the comments about the product pipeline. what did they invent anywhere near an ipod or the imac, which was the first steve jobs product? the iphone, what could possibly be close to that? it is hard to imagine anything. we said a lot of people are talking about services and cloud services and the way they screwed that up. clearly, they're looking in a rearview mirror and not looking ahead. >> there are a lot of people criticizing this beats deal. they don't think it is very innovative. >> it is also expensive. beats has an android app and a windows mobile app. apple has this very limiting orthodoxy of developing just for ios. having beats allowing to exist as a separate brand allows them to relax some of that and build an independent service that is basically following consumers and how they are using the internet. >> do you agree? >> i think it is easy to be skeptical. there's no question that

apple and google arguably started at the same time. thee obviously started in 1970's, but then steve jobs got fired from the company in the 10-1580's and apple went years where fortunes really declined steadily. it was not until 1997 when steve jobs returned that apple's fortunes really began to rebound. in fact, it is pretty well-known among people who pay attention in the valley when steve jobs came back, apple had 90 days of cash left before it was going to augur in. respects, you could say both companies started around the same time. >> you right in your book that battle is thele defining battle of a generation. what do you mean? one of the things that makes silicon valley so interesting is that most of the companies here are started by their founders. -- results whenever they are there are fights over things, the fisa get nasty and personal very quickly because each of the companies has been built from's scratch -- built from scratch. steve jobs took everything that happened to apple personally and larry and sergey takes everything that happens to google personally and mark zuckerberg takes everything that happens to facebook personally. and so, fights can break out. kind of nasty. on top of that, what you are dealing with apple and google in par

. >> thank you leah good morning everyone i want to say i want to have apple apple for daniel silverman we've had other leaders but thank you very much for the bike coalition one thing we did in the richmond we came up to polk street but improvements like this are needed throughout the city and mayor ed lee has strong support we need to increase the funding for bikes lastly i was a student at the uc davis and as what we

apples to apples comparison and our 3 dollars and $0.25 is right in between those tractions look like across the street. keep in mind our 325 is the minimal rent we can also ask for more a top floor with a view of the water it's less. the tenant improvements just to give you a sense of the significance this is an interior dishonesty round house and this is an interior shot of the house after the improvements from our design tenants they've sunk a lot of money into it. so i thank you for divulging me in the weeds of those examples back out in general we're increasing office rents by 6 percent and some not adjusted at all with the high adjustment of a thirty percent increase in the round house. as a point of comparison cushman and wakefield did a study that shows the rents they're up 8 percent from the prior year that is a sense of where our 6 percent falls in market and so that's the port office rents. the challenge of comparing port property to private property also is a problem when you look at sheds to warehouses warehouses have loading bays for the trucks you don't have to lift things up and down they don't have supportive that pill last year's our advantage we have an amazing location this gos close to the businesses and the restaurants in san francisco. we jefferson are able to charge more than our what is a exerts. overall we're looking at the an increase of 3 percent that includes a subsequential decrease in the shed of 33 by 44 percent due to the entirety of the load restrictions you can't drive large trucks out there and roofing problems and the lifespan of the building is in question so we can't give people a 5 year lease that's a changing situation. then on the high side increasing the rents by 40 percenters. and finally the last big perimeter rents is land land is again sort of a different part of our portfolio it has a high vacancy rate and we're not having a location driven but in daily city and others counties generally, we're dollars doctors the rates of paved and unpaved land by $0.02 and leaving the improved land where it is. from here we're going to come back to the board an june 10th >> on the paved land can the prospective tenant put containers on that. >> i'm going to defer that to one of the leasing managers. >> what. >> please allow me to defer that. >> jeff bower leasing manager. >> so we're actually commissioner we've jumped the gun for a mommy public comment seeing none, public comment is closed. >> go ahead jeff. >> sure someone wanted to put storage containers on that's an acceptable use. >> and the rent stays the same? >> well, when i say storage containers are you saying self-storage or it's a construction company. >> for construction equipment i see a lot of containers on the port property i have no idea if it's paved. >> it's acceptable in the construction company wanted to store the material it's the same. >> how much of our office space or rentals would need to have an improvement all of that when we decide to rent out is it in that badass shape. >> it's u actually telethon you saw ammunition i believe i brought ammunition before you for approval they put 4 hundred thousand it depends on the tenants smaller tenants want a place for a phone and mailbox it depends on their resources. >> well, now i understand the difference between the private sector and the private sectors they do their own tenants or their tenants do their improvements. >> yeah. what an allowance we'll carpet it for you. >> commissioner brandon and yeah. i had a couple of questions you gave us the unpaved land but didn't discuss parking. so i see from our report 89 hundred and 80 thousand square feet of unpaved land and 9.9 million of paved land and 8 hundred and 31 thousand this the the budget of our space is parking part of that configuration of all those numbers and what's happening with parking we didn't get a report on the parking side. >> thank you commissioner the parking that's subject to the perimeter rent schedule is generally, the stalls of the parking we lease on an individual basis like port employers like 3 hundred stalls we manage on the seawall lots those are through a competitive process. >> i guess at some point we'll proposed it as an informational item it's a breakdown exactly again but to refresh us again in terms of how the real estate sort portfolio whether that's a direct lease or how the real estate is putting forth and the components so we understand that so we get a better sense. you mentioned our first lot that was interesting to know that the perimeter rents they're the bulk of a number of leases they contribute very little in terms of the actual percentage of overall revenue is that right >> that's correct. >> so we look at we spend a lot of time looking at the port financials it's the other revenue sources that we need to understand and what's happening with those so we need an understand how those operate in terms of the increase so a summary without having to go through the leases a that's a little bit more informative. >> you mentioned on the buildings you said 6 months if we want to maximize rent is that a curiosity number i think in san francisco it takes 6 months if you wanted the highest rates in this asthmatic that a theoretical number i'm not sure that's current market rate information. >> that's a conceptual example. >> it's important to know that's a very good point on our see of the street we go going through the progress of the commission and board but by the, go faster it generally take pretty long we have some - and i think non-market trends it takes time to negotiate. >> i think the differences is it's if i come to agreement when you sell a house if you measure at that time, from when the house is put on the market it's a very long time but when you measure an agreement to sell the house whatever that's a shorter period of time that's market driven but it's driven by other factors and you have to have time it's a question of which metric to use in terms of the actual revenues but how fast can you get that property render and know it's going to be rented auto u out it the medicare metric. >> that's from one tenant another. >> one question i've been curious to know under the office buildings and other spaces you mentioned it briefly in saying okay if it's the top floor with the view is a different amount as a ground floor we know in hotel rooms for one night i pay a different amount what's the policy in number one how much office sprais space has a view and what's the range of charges that's what attracts people to the port what's our guideline in terms of how much more premium do we put on the rate. >> i'm going to defer to the at large manager. >> i won't say there's a set policy but obviously in negotiations there's a bigger rate. >> what's the range. >> well, it could be 10 percent or 20 percent more. at pier 33 north for example, we received $3.50 a square feet but no view it's 320 >> many people were against this strictly to protect their views so we have is something to offer so let's make sure we charge for it. >> absolutely. >> and you may have touched on this a little bit we may not have the ability to upgrade our office space but have we had an eye of the class c office space to office b is that changing a bit for example, many consider a to be the downtown office space but we have space over the water with the changing companies and businesses coming to san francisco that's a changing the category in some respects and class b is measured it's a typically former class a pier 33 north we approved the bay and put $1.5 million into the property it's a small development ground floor and retail and commanding 350 a square feet for the space we put in a elevator and did finishes and the utilities if we have the people to do it we typically get the tenant to do that for example, ammunition rounds out the now, it's a lot of tenants want to come in and remove the hung ceiling and that's not cheap to do we get the argued and when we move out we get the better rent. >> we have a priceless view are reindicating riggs what we're offering for the view when i think about autodesk they wanted it to be industrial not a typical class a office space how do we category that and i thought commissioner was going down that road. >> that's american people industrial feeling that's in a that's what the tech sector wants he don't want the old style class a but more of an edge i didn't atmosphere it's selling better in san francisco than having the finished class a office space and if we could convert or for example, pier 23 or 19, pier 27 for office we could lease it out the demand is there. the constraints come from the entitlements that we get the change of use and the seismic upgrade is there demand absolutely. autodesk is up to $16 million in investment in the pier. >> right. >> and that is where i was going interest thank you commissioner ho. >> i guess along those lines and maybe we're looking at basis rents so we have the ability to - >> yeah. we can go higher. >> wheelchair seeing the tech companies coming in and we have a to make sure we taking into consideration the leases are very, very desirable and not your typical class a office space i would a rather business owner be on the waterfront. >> we're commanding rents and this vs. a lot of offices. >> no one wanted compartment time listed and they want to quickly based on their operations and the growth and size and moving things around that's the way offices are configured you don't want wails. >> with autodesk they've got other sites in the area and pier 9 is by far they're most popular site employees requesting to work there and i was reiterating one thing we have an extraordinary low vacancy rate so we want to see the changes we don't have a lot of options unless we get the vacancies. >> that is there's a balance that we have a lot of small businesses sole proprietor and to, you know, a 3 or 5 percent most folks can handle that but when you get into a 40 percent that's tough for a small business we do deserve and trying to get the best rate of return but we're sensitive we don't want to drive our small business yourselves out of the market. >> one other thing i'm not sorry i understood accident schedule which your converting the office from that to triple net we come out much lower on an annual basis; is that correct? >> yes. >> when you convert apples to apples it is closer in range $5 off per square feet is significant. >> we have round house we're saying is class b arguably it could be class b minus in pier 9 the rental rates quoted take in a larger geometric area like the downtown and financial district and, you know, frankly they command a higher rate those class b's have on site security and property manager on site my a janitor you call they're at our door wondering how to help you. >> if we wanted to translate and understand the costs to us based on the square footage at some point not today, we should have a report how much of the office space has improved like autodesk that have improved it how much more space would we want our office space to be upgraded they'd dir my cash flow and every deal we're not getting the cash in but lour for the fact their improving the property how much more improvements dakota look we've improved? a cash cow and those perspectives i'll ask elaine to look at how much further not in the capital

apple. and for a moment, just a moment, i didn't recognize. i'm like what is that? oh, that's an apple! so used to seeing it in a pie. is peeling an orange even worth it? there's not even chocolate in this. some people use gathering apples as an activity. why don't we go apple picking? because i'd rather die. >> i disagree. apple picking is fun. >> that was a clip from the

dre confirms the beats' sale to apple. apple bought it for reportedly 3.2 billion. wow. >>> and by the way, otr fans, that's for "on the record," how come no one pointed out that i guessed last night that the packers would pick haha in the draft? i'm glad. i own a share. and in case you're wondering, his grandmother apparently gave him his name when he was 3 years old and just to prove how big of a fan i am, you may remember when i wore a cheese head literally and i'll wear it again. boy do i look like a fool but i love it. also trending right now, mother's day, i tweeted earlier my mother was always in my corner and was in trouble with the nuns. #mothersday. >>> and a satanic event causing outrage on campus and among catholics. the senior chaplain and harvard student is here next. >>> and students are fired up over a teacher be >>> this is a fox news alert. there is new information about the 276 nigerian school girls kidnapped by terrorists. senior officials telling fox news they believe the girls have been broken up into smaller groups. they do not believe if they

apple is buying beats electronics for $300 billion. how will this affect retail stores? joining us, former apple executive george blankenship. he was apple'sident of real estate from 2000-2006 and played a key role in the growth of apple's retail strategy. most recently he was an executive for tesla motors and now we have west coast correspondent jon erlichman. i want to get your thoughts on what this deal will do to the footprint of apple stores. >> i think this is probably another step along the way that apple is looking at of assembling multiple things that most people today don't recognize as being a collection of things you can put together which will then turn into something that will go into the stores, go into a customer service-oriented product that most people don't see yet that will then be a product up the stores can leverage to continue a great existence for the customer. i don't think most people are able to see what that might be at this point. >> you are saying this is beyond headphones and beyond streaming. it's something that isn't out yet. >> apple i think is a company that's among the best in the world that looking at t

not at apples and apples, but as apple and oranges. >> i hope today's conversation is a down payment on that wider talk that professor smith is looking for. thank you all for being with me today. that brings us to the end of this edition of inside story. thanks for being with us. the program may be over but the conversation continues. we want to hear what you think about the issues raised on this or any day's show. log on to our facebook page or send us your thoughts on twitter. or you can always reach me directly @ray suarez news. see you for the next "inside story." in washington, i'm ray suarez. >> hello and welcome i'm phil torres here to talk about invocations that can change lives. the intersection of hardware and humanity and we're doing it in a unique way. marita davidson is a biologist specializing inning innings innd evolution. kosta grammatis is an engineer

not at apples and apples, but as apple and oranges. >> i hope today's conversation is a down payment on that wider talk that professor smith is looking for. thank you all for being with me today. that brings us to the end of this edition of inside story. thanks for being with us. the program may be over but the conversation continues. we want to hear what you think about the issues raised on this or any day's show. log on to our facebook page or send us your thoughts on twitter. or you can always reach me directly @ray suarez news. see you for the next "inside story." in washington, i'm ray suarez. >> showing he cares. turkey's president visits the town where 282 minors were killed. and anger protesters say the thr brothers should not have had to die for profit. >> hello, japan alarms china with proposals to allow japanese troops to fight over

apple just sell those in apple stores? >> and they do. i was speaking to a formal apple executive today who said tim cook is a smart person a does not have to pay $3 billion to slap an apple logo on beats accessories. they are making money through that partnership already. that opens the door to what could come next. we talked about apple and its placement in the living room, the future of television, how it will play in that world. what if there are things they are working on we don't know about that would help to make this merger of hardware and software and entertainment make more sense? you certainly get the sense from people that while there are bits of the story that seem obvious why they might go after beats, there is a lot we don't necessarily know and that's the way apple goes with these deals. >> hang on, i want to bring in apple and john irwin, the former president of rhapsody which was the first subtraction service to offer unlimited streaming service for a flat they. what does it mean for you guys? is this more competition? apple,s a signal that not surprisi

apple needed an ambassador to the creative community. content is about selling hardware. apple tv, the ipod touch. you need the content. apple has had a limited orthodoxy. download-centric model. i think jimmy and dr. dre bring back to apple with a lot of credibility with media companies and artists. >> you don't think there will be a culture clash? keeps making those videos, there might be. go ahead, peter. >> they're culturally less the similar than you think. steve jobs was very much considered an artist by money. aey just approach art in different kind of way. you have the artistry that comes with technology. i think this is a really exciting deal to signify this convergence of technology meeting great content and driving great technology. >> i want to make one other point. this is seminal for apple in another way. the biggest deal before this was when they bought next and i was not only the biggest deal but apple was proud of that. they would never do a deal bigger than the next. folks would say that. it marks a departure from the old orthodoxy and it shows they are now willing to take bets to complement its product and

apple. >> what about the cultural differences? you can see the difference between eddie personality and personality. he is very much larger than life and very outspoken. not your typical buttoned up apple executive. >> apple needed an ambassador for the creative community. content is what is selling hardware. , the ipod touch. you need the content and the apps. apple has a limited orthodoxy. it has a download centric model. consumers want to get content in different ways. jimmy and dr. dre bring that to apple. they have a ton of credibility with media companies and artists. >> you think there will be a culture class? -- clash? >> they're culturally less dissimilar than you might think. let's not forget the fact that steve jobs was considered by many to be an artist. you have content and then you have the marriage of artistry and technology. i think this is a really exciting deal to signify this convergence of technology meeting great content. content drives great technology. otherant to make this point. the biggest deal before this was when they bought next for $400 million. that was not only the biggest deal, but apple was proud of that. they would never do a deal that was bigger than the next deal. m an

apple usually doesn't buy other brands. you never heard of another brand by apple. apple is apple. e small companies for talent and new technology. this is really out of step with what apple usually does. >> approximate paid so much money. >> $3.2 billion. the company was valued at a little more than 1 billion. good talent there. jimmy is a big music industry and guru with close ties to apple. maybe he could have a role many people are saying over at apple. the big winners here, the big winners are the private equity firm carlyle that invested last year in this company and made a lot of money in seven months. a lot of money in seven months if this goes through. apple is notoriously discrete about what it does. if you look online today, there's a lot of indiscretion among some of dr. dre's cohorts about potential this deal gets done. it's pretty interesting. no official word yet from these companies. >> christine romans, many thanks. still to come in the "newsroom," plans canceled for an upcoming show because of controversial comments one of the hosts made about gay people. that host

apple, who believe the apple products are the next big thing. conveyed, the next big thing is here and it is samsung. it's not apple. eople are buying into that, and that's definitely a problem apple will need to overcome. the products are still very popular. people in china do not like it when the products are not available. apple could use a bit more buzz. >> tom giles, thanks so much. the publisher behind "vogue" and "gq" is bringing content to life with digital video. the new push onto multiple screens, next. ♪ >> that was a clip from one of my favorites. our next guest help develop that series, along with "vampire diaries." now she's turning her focus from traditional tv to digital video. conde nast entertainment president joins us to talk about how the magazine publisher is taking their content off the page and onto your screen. she joins us from new york. i'm a huge fan of many of your shows. i'm curious what the transition has been like for you from creating shows like that to creating content for digital video challenges -- channels. >> it started when i was at the cw. we were targeting 18-year-olds to 34-ye

apple, you know, audiences, the people who have allegiance to apple as a brand are tending to be a bit older right now than a lot of people who made that brand allegiance to apple that came with about ten years ago when apple refreshed all of its products. they have to acquire something for that cool character. they definitely have it. it's better than other markets in that space. >> are there people reacting to news of this deal are talking like downloading is already over, done, peaked. we're still talking about a multi billion dollars industry. >> it's all together different talking about an industry that has stopped growing. i bet there is a thriving eight track following on ebay. it's really a question of what is that growth curve look like. as you pointed out at the top of the show sales were flat last year and they're down over 12% this year. the wholesale retail buying one song at a time or one album at a time if it ever made sense for consumers in the i pod at the sam ipod >> many believed that you will just pay to listen to music after all music you own you can live to forever. what's different about streaming streaming. >> young people grew up taking

apple. apple has been advancing. on january 30th, apple hit a low of $499 a year. at the same time twitter stood at $56, what drove apple up? was it time lines, monthly average users, love of the website per share? no, it was earnings per share. as in earnings sharply better than expected. so much better than expected that even though the stocks vaulted higher it sells for 14 times earnings. and geez, that's cheap. no wonder the company is buying back billions of dollars of stock. it's a good investment. is there tremendous insider selling on apple? no. it is being done opportunistically. meaning when the stock gets hammered, apple's management is in there bringing stock in. there's ton of twitter stock hitting the market at the same time there's tons of apple stock being retired. no buy back for twitter. no dividend. another lovey blanket the market likes in the end it didn't matter today. it had an overall impact on the psyche, bringing down apple with it. great returns were able to buck the trend. i don't expect tomorrow to bring a reversal of fortune. remember l

apple needed it. content right now is what is selling hardware. the apple tv -- the ipod touch -- you need the content community apps and apple has had a limited orthodoxy. -centricad a download model and consumers want to get content in different ways. bneats brings that to apple. >> you don't think there will be a culture clash? >> if dr. dre keeps making those videos, there might be. they are culturally less to similar than you may think. steve jobs was very much considered to be an artist by manning. arty many so they approach and a different way. you the marriage of artistry with technology. i think this is an exciting deal to signify this convergence of technology with great content and ultimately content drives take -- great technology. this deal is seminal for apple in another way. the biggest of before this is when they bought next for formally and dollars. apple was proud of that. they would never do a deal that was that your than the next deal. archer from the old orthodoxy and it shows that apple is willing to take bets to complement its product and services in areas where it is weak. it is important step the company. >> the cash the still c

apple and samsung. they found samsung infringed over apple's patten. that's a fraction over the (200) 000-0000 plus dollars apple asked for. apple also infringed on one of samsung pfg pattens. this may not be the end. investigators say speed may be to blame for a crash that killed one person and injured another. officials say two vehicles were involved in the kraksfelt one vehicle was speeding. two people were taken to the hospital where one died. officials have not released the identity of the person killed. san hohow say police say they make an arrest to a killer. she was stabbed to det at her arment. today they arrested gab rial on susigz of murder. the suspect has the same last name at her husband. neighbors were relieved to hear of an arrest. >>> we're going to see the kids grow up -- i'm glad they caught him. >> he plans to move away. there is no reason to stay. police have not revealed a motive. >>> it's being called the largest prausitution crime ring bust. >> reporter: sheriff's deputy gathered at the allah meddy center to prepare for a strike. inside investigators let us see the command that would coor

apple has more than 400 stores compared to microsoft. apple generates $20 billion in sales per year. microsoft doesn't break out those numbers. apple actually averages an estimated $4500 in sales. microsoft is at $500. just getting the consumers to think of it as the go-to destination. it is making some head way with the kids. back to you. >> what's going on behind you? are they dancing? >> you've got dancing. music. it's still going on right now. really, the lines this morning, hundreds of people just circling the store. >> all right. get your groove on, josh. thanks for that. had to address it. the elephant in the room in that shot. let's be honest. microsoft also has stores within best buy which offered investors a disappointing outlet. expecting negative comps due to soft demand. beating forecasts on cost cutting. the stock closing higher on the session. joining us is the retail analyst. david, great to have you with us. we laughed at you when you said you liked best buy. >> is that why we laughed at him? >> there's other reasons. >> what does this say when they say the demand is thin for consumer electronics, that they're seei

apple -- is what apple hopes to get is dre's cool. a certain cachet, whether to young folks or interested parties that make that particular brand and its offerings more appealing to apple than perhaps pandora and spotify would be. >> it paid over $3 billion to buy the company, three times as other plants -- buyouts. once all-powerful itunes software is losing ground to streaming services. that, apple has nothing. they will not be able to attract people to buy their high-priced hardware. they need to move strategically. givingppears to involve dr. dre full-time positions at apple. dr. dre will focus on his music as a priority and will work for apple when they need him. staying in the united states, the american economy took a bigger hit from harsh winter weather during the first quarter than expected. figures show the u.s. economy shrank by one percent between january and march. it is significantly slower than a previous prediction for the first quarter and is a turnaround for the last three months of 2013 when the u.s. economy powered ahead with a growth rate of 2.6% on an annualized basis. much of it was attributed to the strength of the severe winter weather that hit