and bloomberg tech toss sarah frier. o know the latest, what are lawmakers doing, what is facebook doing now? sarah: during the 10 hours of testimony the zuckerberg says i'll have my team follow-up with , you on that -- now that is happening. giving theiren are questions to facebook staff. facebook staff has to go through and meticulously answer those all. and then we will get some interesting answers that take a little longer than the five seconds zuckerberg had to respond. emily: and he said "i will have my team follow-up with you" many, many times. how satisfied are you with what you heard from mark zuckerberg, and how satisfied were you with the questions from lawmakers? >> i would give both mixed results, for reasons i think are obvious about the structure of the hearings themselves. think about it in the senate , hearing, in the first hour and a half, there were at least a dozen different issues senators raised, areas of really serious concern, and that helped mark respond. because he did not have to worry technique

you, sarah frier. still ahead, crypto craze.will hear from the ceo of pantera capital on why bitcoin is a screening by right now. this is bloomberg. ♪ julie: bitcoin came to the forefront of the public's attention last year with its dramatic ascent and has quickly had a rise and fall. erik schatzker sat down of pantera capital management ceo to ask where his fund is invested in the crypto market and why. >> our first fund was just a bitcoin fund. it allows institutions to get exposure to bitcoin. since and we have launched different funds that allow exposure to all the other currencies and equities in the space. erik: so pantera is a real hedge fund which is to say it goes short and long. but you are also fundamentally bullish on crypto. how do you reconcile those things given the fact that you are fundamentally bullish and you think that coins and tokens will appreciate in value over time? how do you decide to go short and went? -- when? >> is a new asset class and we wanted to build our flagship product for the 10 to 20 year f

emily: that was roger mcnamee and bloombergs sarah frier.oogle's youtube is being accused of violating u.s. law on children's privacy. a coalition of child advocacy has asked the government to investigate. the groups say youtube uses the information to illegally target ads. youtube said in a statement that it will look into the complaint to determine if improvements are necessary. coming up, our exclusive conversation with anthony noto on how he is shaping the company's future, now that he is at the helm. and later, we will hear from representatives from california and new jersey, their reaction to the facebook hearings and thoughts on the future of tech regulation. this is bloomberg. ♪ ♪ emily: in the battle for e-commerce supremacy in india, walmart may be about to leave amazon in its wake. india's leading e-commerce company is said to be leaning towards selling to walmart, according to people familiar with the matter. both are bidding for a controlling stake at a $20 billion valuation, $8 billion more than their 2017 valuation. if complet

the post that question to roger mcnamee, and our very own sarah frier.imes duringse that 10 hours of testimony that zuckerberg said, i will have my team follow up with you on that, now that is happening. are gettingmaen their questions to facebook staff, facebook staff has to go through and meticulously answer them all, then we will get some really interesting answers that take a little longer than those five seconds zuckerberg had to respond. >> and he said i will have my team follow-up with you many, many, many times. roger, i'm sure you were listening. how satisfied are you with what you heard from mark zuckerberg, and how satisfied were you with the questions from lawmakers? >> i would give both mixed results for reasons that i think are obvious about the structures of the hearings themselves. during the senate hearing, in the first hour and a half, there were at least a dozen different issues that senators raise, there is a serious concern, and mark didn't have to worry about prosecutorial technique being applied at him, hammering at the same issue.

here with me in new york, sarah frier, who just flew in from d.c.. what are lawmakers doing? now? facebook doing sarah: during the 10 hours of testimony where zuckerberg says , i'll have my team now? sarah: during the 10 hours of testimony follow-up with you on that -- now that is happening. there are questions from congressional staff. now facebook has to go through an answer them all. it will take longer than the five seconds zuckerberg had to respond. emily: and he said "i will have my team follow-up with you" many, many times. how satisfied are you with what you heard from mark zuckerberg, and how satisfied were you with the questions from lawmakers? >> i would give both mixed results, for concerns about the structures of the hearings themselves. in the senate hearing, in the first hour and a half, there were at least a dozen different issues senators raised, areas of really serious concern, and that helped mark respond. he did not have to worry about prosecutorial technique being used on him. he could say, i will get back to you, and move on to the next topic. the problem wit

let's go to sarah frier who is standing by. your amazing reporting continues.is not coming to europe, but europe is flying out to him. what are we expecting in the meetings with some of the chief digital regulator? sarah: as we saw last week in testimony, there were a lot of questions about whether facebook rules, they have to now in europe. he's also going to be meeting with google. it will be a very educational trip. he met zuckerberg in the past and said it was a very cordial meeting. they shared information. he has met with sheryl sandberg in the past. now, i think things are getting a little more serious as the eu wants zuckerberg to come testify, just like everyone else wants zuckerberg to testify. he's quite in demand. caroline: indeed. they met a couple of years ago in barcelona. i want to get opposing views because i have european here next to me. how are the big earnings of facebook really view eu regulation? it is tougher. it is perhaps at times ahead of the curve as sheryl sandberg has admitted. do they feel positive in any way? sarah: i think zucke

joining us, sarah frier. still with us, mark mahaney. oes this have anything to do with the privacy controversy that facebook is in the middle of now? sarah: no, this has much more to do with their hardware ambitions, which have been hampered by the privacy controversy, like the speaker that it wants to build for their home that they will not be releasing next month as planned. this is more about connecting the hardware to the software. mark, i'm sure you've been following facebook very closely. you cover facebook. you watched mark zuckerberg's testimony. you have an outperform on facebook, but the company was downgraded today. do you think all these privacy concerns, the changes facebook is making, taking less data from 16-year-olds, for example -- will this have any impact on the business, on use, and on the revenue brought in by advertisers? mark m.: i'm going to go out on a limb here and say no. our advertiser surveys have not shown any material change to budget allocations by marketers. i don't know whether there will be a temporary

emily: joining me now, bloomberg technology's sarah frier, who is in washington to cover this week's hearing. we have gone zuckerberg's prepared remarks he intends to read. he is very apologetic. does anything in this testimony surprise you? sarah: what surprised me is that facebook still does not know exactly what happened to this data from back in the day. of tellingo way lawmakers whether those 87 million people actually did have their data looked at by cambridge analytica. they did not build these productions into their products back when they had these rules. so zuckerberg -- really all he will be able to do is go to congress and apologize and explain the ways in which facebook is doing better, but he is not going to be able to answer some of their core questions about what exactly happened and how many people need to be worried about third parties using their information without their consent. emily: we wonder how well this apology is going to work. we also heard this from senator bill nelson about their conversation. take a listen. sen. nelson: he said to me very for right thre

emily: joining me now is sarah frier is in washington to cover this week's hearing. rst of all, we have gotten zuckerberg's remarks that he intends to read. he is very apologetic. did anything in the prepared testimony surprise you? sarah: what surprised me is facebook still doesn't know what happened to this data from back in the day. of tellingo way lawmakers whether those 87 million people actually did have their data like that by cambridge analytica. they didn't build productions into their products back when they had these rules. -- i'll do will be able to do here is that you will go to congress and apologize. he is going to explain the ways in which facebook is doing but he is not going to be able to answer some of their core questions about what exactly happened and how many people may need to be worried about these third parties using the information without consent. emily: we wonder how this apology is going to work. we also heard this from senator bill wilson about the conversation. >> he said to me very forthrightly, we were lied to, and we should have caug

i want to bring in sarah frier and garrett giving -- gerrit de vynck with us as well.here are a lot of things to talk about here. facebook updating their privacy policies, not changing it, but making them more clear. also making some changes to how they collect user data. for the first time that i can remember in a very long time, mark zuckerberg taking 45 minutes of questions from reporters. what stood out most to you? : what stood out was that zuckerberg was even doing this. it will prepare him for his congressional testimony next week where he is going to be grilled under oath, which is a bigger deal. this call gave you a sense that people are wondering if he is the right person for the job. people are wondering if he understands his great responsibility here with a spoke users' data -- with facebook users' data. the thing he kept repeating is that facebook did not take a broad enough look at its responsibilities with regard to user data. he wanted to make the point that now they understand that it's not just about doing what users have signed up for, what's legal,

sarah frier, our facebook reporter what about that today. now the methodology has been to introduce a product and iterate as you go. if it is not completely safe or doesn't protect privacy, we will hear about it. users will complain, and we fix it on the fly. there is extraordinary leniency from lawmakers and regulars here. not so much in europe. this morning lawmakers were on bloomberg saying we'll see how europe's relation works out. is that the fundamental difference here? tom: there is a big difference and a general a look culturally and societally about privacy. there are a lot of people in the u.s., particularly under users of social media who kind of have written that off in many regards. they understand, we are putting our lives out there. we get what is behind it. there are people who may be older or a different generation were actually -- this has been very much a rude awakening for them. they lost track of my data, they did note that was going to get and weed asked around, still have questions what the cambridge in the current do

emily: that was sarah frier and caroline hyde.nd as the fallout continues in the wake of the exploitation of data on millions of facebook users, we caught up with dick costolo and asked him to weigh in on the controversy. dick: one of the concerns or questions i have is the impact it will have on the way people think about api's and access to data in the future. obviously, facebook has built out this platform approach that enabled third parties to act as -- to interact with it in gauge -- interact with and engage with people on facebook, and turned that off from years ago. we are seeing the consequences of some of that. i think it will have an impact on the way technology and company is forward think about how the data will be used, how they can audit, how it is disposed of. emily: how does facebook use data differently than twitter? as i understand it, twitter is more protective of user data, though twitter has its own issues which we can talk about. do you think facebook has been too permissive, too careless about user data? dic

julia: let's begin sarah frier from san francisco.l take on some of these numbers, and to go back on the question were asking earlier, is it too soon to see some kind of material impact as far as advertisers are concerned on what negotiating power they are bringing to bear in light of the scandal we got from cambridge analytica? theh: let's be clear that scandal broke at the end of march, so we might not see the full impact of the changes and all of the turmoil that has happened internally at the company since then until the next quarter. to be fair, this company has been embroiled in controversy for more than a year, and it is still going on also wonders. cylanders. the revenue is at near record levels in the other quarter that was better than this was the fourth quarter before this. the business is so far surviving a lot of the controversy and scrutiny around it. joe: we don't know for sure yet what the fallout of cambridge butytica scandal will be, we can say for sure is we are not seeing any decline yet, right, sarah? sarah: we se

scarlet: for mark welcome bloomberg facebook reporter sarah frier who is in washington getting readyearings. in addition to the meeting with senator nelson, we got a copy of what mark zuckerberg is going to be saying in his prepared statement. the summary here appears to be i am sorry. sarah: that is absolutely the summary because mr. zuckerberg doesn't have anything else to add. the company doesn't know exactly how many users were. affected by the cambridge colleague. they can estimate 87 million, but they don't know. despite the testimony from news they are saying that they are doing a whole lot to try to make sure this doesn't happen in the future. they can't undo what they have done in the past. zuckerberg is going to have a lot of i am sorry and a lot of i am going to fix this. joe: zuckerberg was on capitol hill meeting with key senators. is he trying to soften it up before the hearings? what is the deal here? sarah: it is a strategic move and zuckerberg was to be in a position where he feels comfortable during the testimony tomorrow. he is not the world's best public speaker c

mark: this is a significant story with our number team of ian king and sarah frier. chip business. they have started forming a team and tiring management to build a team that can develop ai chip servers, and all sorts of stuff. that goes into their long-term pipeline of what is going to power servers in the data farms that power the facebook website and facebook app. and also on devices, what components are going to power smart speaker's, and the facebook oculus goggles, and what is going to happen internally with those. joe: facebook does have hardware ambitions, and they are nascent and we'll talk about the much, but they have their own gadgets in various stages of development? mark: as part of mark zuckerberg's master plan. 5, and tenure stages, and this is in the latter half of the plan. we had a story last year indicating facebook is working on alexa like smart speaker's. and are due to announce those in may in their annual but sarah wrote recently given the privacy things going on with cambridge analytica, to are going to delay that until later in the year. as

emily:all right, sarah frier, selina wang, thank you for stopping by.ng boxshare surge the most in three shares. investors are interested in tapping into artificial intelligence to go long on the stock. boxsocial capital ceo said is incredibly cheap and undervalued, the biggest intraday increase since january of 2015. coming up, should facebook employ more people to stop dodgy ads? why the ad model might not be the brightest strategy, next. ♪ emily: mark zuckerberg is in hot water again. mark lewis says he is suing facebook for defamation over dozens of unauthorized advertisements that used images of him. facebook asked users to report the viimages. mark lewis said he did exactly that. the handling of pretty much all the ads is automated. tell us. more about this lawsuit. >> there was a great story on business week, which talked about a very dodgy company. they could use a image from shark tank, for example, to promote the products. they are suing facebook because he constantly reports these sorts of events and facebook says it takes them down, sometime

let's go to san francisco with sarah frier. she has been covering the conference call. e this controversy, it seems facebook, for now, has dodge a bullet on scrutiny. sarah: it was interesting on the call to hear them talk about their business. the pasteard them in few weeks talk to journalists, congress, and say, we are doubling down to take this extremely seriously. we will be making a lot of changes and be doing an audit of our products. on the conference call was a positive message. we have a lot of runway for our business. this 49% growth, we have so many things we can do. we have instagram, whatsapp. advertising is not going away, only getting stronger. probably the most positive thing we have heard from facebook in a while. be may be thehis last quarter we see numbers like this? sarah: you make a good point. the cambridge analytica data leaked news happened at the end of the first quarter. there are a lot of things in the second quarter that are very concerning for facebook's business. we have the gdpr privacy rules rolled out in europe. that could affect users of

sarah frier, thank you.eak to facebook's sheryl sandberg at facebook's headquarters in menlo park 3:00 p.m. -- menlo park. it will air at 3:00 p.m. thursday in new york. the race for artificial intelligence. working on bringing touchless control and curved screen said iphone. joining to mark gurman, us from san francisco. joining us.r let's start with the curved screens. we heard about this from samsung, apple is just playing catch up here? mark: that is dead on. samsung phones have done this for some time, curved displays that curve on the left and right edges. apple is looking for an opposite curve, and inward curve on the top and bottom, very gradually, as an aesthetic addition. yvonne: on this touchless gesture control, i am imagining something like minority report where you are moving things around. how would this work and how far away is this, if it really did happen? mark: it would be a new dimension. there is 3-d touch and that allows you to have it -- a harder press, and a fourth dimension that allo

yvonne: i want to bring in sarah frier, joining us from d.c.. she watched the testimony for the last five hours. what a day it has been. tell us about the performance of mr. zuckerberg, how did he do? he had an easier time than he was expecting to have. a lot of the senators asked him questions he could simply say, this is not true. they asked him why facebook sells data on its users to advertisers? he could say over and over, we do not sell your data to advertisers. people that have a fundamental misunderstanding of how facebook's business works. theirople who did have homework done before the hearing asked very good questions and try to nail some things down like, why was that users were not informed of the breach in 2015, when facebook first learned about it? they said because they considered it a closed case. of interesting questions about the line facebook draws on content, whether, as that becomes something that moves over to ai, if that is still something that protects people's right to free speech. which is not something a private compan

sarah frier, joining us and of course, henry lane fox, our guest for the hour, sticking with us.oubling down in london the details on the multimillion dollar office complex, next. this is bloomberg. ♪ ipo of $4 billion . a bit closer to home, wework doubling down in britain. it specializes in shared workspaces, teaming up with two $826 million. pay they are in negotiations to purchase the complex. the u.s. announced the deal will close without disclosing the purchase price. henry lane fox, still with us. this working space, will that benefit them? henry: unquestionably. i am a huge fan of wework. i think it is a fantastic thing for london and this deal says that london is here to stay. we are very lucky to participate in the startup and there is no sign of the growth trajectory they are based around, the startups that are launching. to see thatsuring people are still prepared to make sizable investments here, betting on the fact that london is a wonderful haeartland for economic ecosystems. caroline: what about brexit? henry: that is a great question and there are three things we

joining me now from new york to discuss the week that was facebook, is sarah frier, traveling to washingtonveling to washington this week, you have been our eyes and ears. our colleague jeremy has been diving into what else the university has been doing, building up software of the companies have used. how far do we know the investigation by facebook has gone? is there any news? sarah: we know facebook has this long time relationship with academics because we want to ourrstand this force in lives, 2 billion people on this platform, more than that actually, who are interacting with each other. tois an academics dream figure out all the societal implications of people talking with each other in a recorded way. it makes sense, to understand facebook academically, especially as we see the influence on elections, people's mental health, so facebook has tried to work to give academics a little more visibility, and at the same time, they want total privacy. so it has become tricky in the past. i was very surprised hearing this from zuckerberg during the testimony that they were not waserned with w

vonnie: thank you to sarah frier continuing to follow the story. to amazon, stock of the hour. the shares under pressure again, abigail doolittle telling us why. abigail: it is a continuation of what we saw last week. what we are looking at for amazon is over the weekend the president weeding around -- tweeting around the company, saying that company is costing the united states postal service, up to $1.50 per transaction. amazon saying that is not to come up with saying again that they are losing a fortune. it is a continuation of a report last week saying that the president wants to attack amazon, not facebook. capitol hill wants to go after facebook, but donald trump wants to go after amazon because they are not paying enough taxes. and ever core saying perhaps that is true. so they have this huge overhang of uncertainty around the possibility of regulation around tech and the big internet companies, what does it mean. ebay drag on the s&p 500 and nasdaq today, setting a tone of uncertainty. so much uncertainty today and this is a big piece of t

more, let's get over to san francisco with sarah frier. through the latest details we need to know here. >> the first thing to know is the 87 million is actually an estimate by facebook of the worst case scenario. facebook itself has not audited cambridge and analytica -- cambridge analytica. they have gone through and looked at the people who downloaded the app. then they took account of all their unique friends, and with that the highest total you can get to is 87 million, so facebook is basically trying to confirm what it expects to be the worst case scenario before any worst-case gets out there. ramy: so they are setting the bar higher as we wait for the official numbers come through. facebook has put all privacy controls in one area, one new thing is it has disabled the tool that allows profile scraping. what happened here? >> this goes back to how facebook is setting the bar to stay inest possible terms of how many users were affected. in that particular disclosure they say pretty much everyone who has a facebook account at some poin

we spoke with sarah frier who covers the social network for bloomberg on tuesday after the news brokes well as caroline , hyde who joins us live from london with reaction from europe. >> zuckerberg has come to terms with the fact that he will do this. he said last week if i am the right person to answer these questions i will do it but i , have to be the right person. congress can back and said you are the right person. we want to hear from you. zuckerberg has come to terms with that. and in front of congress, there are going to be so many questions that facebook cannot answer. a lot of questions in particular about where this data has gone that was shared with third party developers back before 2014. facebook does not know. they will do some audits. they do not have currently the answers to where are these 50 million user profiles. when did cambridge analytica delete them? they relied on cambridge analytica to tell them that it was gone. until the reporting from the new york times and observer last week, we did not realize that was not the case. emily: what is the reaction in the u.k

sarah frier is covering all of that for us. will it be enough? >> zuckerberg has to hope it will.ay with lawmakers he seemed to make headway, a lot of them saying that they feel like he cares about the issues, they felt like he was sincere. this comes after a lot of preparation for this. the fact of the matter is facebook cannot answer some of the big questions about what happened to the data years ago, where it ended up and how many people were affected. they do not know. so mark zuckerberg will have to hope that his personal apologies, as well as promises to do better in the future, which promises we have heard many times, signals a real change at the company. haidi: we expect any news to be announced to that affect, or will he be rehashing the same thing? sarah: i think that they will be ready with some stuff to answer questions if they come up. i remember in the november hearing for facebook on the russian interference and elections, facebook was prepared with a number on 126 million users that saw the content that russia was trying to spread. and in the hearing, it was the fi

i want to bring in bloomberg's sarah frier.in this edition of bloomberg's businessweek. thank you for making the trip. fascinating story. interesting in the last few days how little instagram was talked about in these congressional hearings. sarah: instagram is a footnote in the discussion of facebook's faults, although they have their own problems. we have seen problems with andia misinformation, bots fake accounts, but compared to the impact that facebook has on the world, people don't care so much about instagram, and further they don't understand instagram as part of facebook. joe: initially instagram was rocket, to the facebook which helped it blowup into the behemoth it is now, but with facebook's core product under such stress, it makes instagram look like a serene island. sarah: part of that is because instagram's functionality is so different than facebook. there is no real mechanism for things to go viral. you can follow people who don't have to mutually friend you back, so it is not a pure social network. scarlet: ne

. >> i want to bring in sarah frier who is in d.c.. i'm previous -- curious what you make of the quality of questions from the senators. i think they're pretty good, sometimes they seem off base but i am curious how close they are to what you would say -- want to be asking mark zuckerberg. >> they are very on point for a lot of this. contrast to is in the bills on russia. it seems they have done their homework for this hearing. we want facebook to protect us from hate speech but like there ised cruz said, something the company has to solve and needs to have them go at them in a vague manner, that is just not something that will be enough for the public, facebook has a much power that they're going to need in bit more detail. it was a great moment when the senator -- the one who had the whole stack of facebook policies printed out, it was like an inch and a half thick. he said can any user understand this. he was asked if he would reveal the name of the hotel room he stayed at, information that facebook knows if you log in. was a very i

shery: sarah frier, thank you. bonus coverage tomorrow mark zuckerberg's testimony with a "bloomberg technology" special that begins at 1:30 p.m. eastern. coming up will have big interviews from atlanta, including an interview with the mayor. and later will hear from the ceo of home depot in an exclusive interview from new york and atlanta. this is bloomberg. ♪ david: this is "bloomberg markets: balance of power". i am david westin, and were in atlanta, georgia. we miss you here in new york, i am shery ahn. it's check in with first world news. mark: president trump is criticizing a stupid trade deal with china. another 25% tariff on u.s. built vehicles. yesterday president trump said china will remove trade barriers because it is the right thing to do. congress will be getting documents on the fbi's investigation of hillary clinton's use in a private female server. jeff sessions responded presidents criticism of the matter by putting the u.s. attorney in charge. the justice department and beer are revealing reviewi