facebook's sarah samberg -- sheryl sandberg testifies in europe.e will talk to a whistleblower who believes more data scandals are to come. that cautionary tale caught the attention of every start up an investor in silicon valley. we will talk to a pulitzer prize-winning journalist who blew the whistle on elizabeth holmes. first, to our top story, apple suppliers are feeling the pressure after a new report that the tech giant has warned suppliers of a drop of around 20% in new iphone component orders. meantime, foxconn raised $4.3 a success its ipo, for the group's boss and his aim to nurture a smart factory division to rely less on making products for apple. foxconn has the maximum 44% in shanghai on its opening day, the largest tech company listed in mainland china. the business is more valuable than ebay with the market cap of over 60 billion u.s. dollars. clients include amazon, dell and cisco. up to 30% of the revenue comes from apple alone. company's strategic investor list reads like a who's who of china's top firms, including alibaba, tence

meantime, facebook coo sheryl sandberg addressed this year's m.i.t.ass, and pushed technology as a force for good it could be misused by malicious actors and reaffirm to facebook's commitment to owning their mistakes. >> when you're on your mistakes, you can work harder to correct them and to prevent the next one. that is my job now. it will not be easy or fast, the we will see it through. emily: coming up, exposing the lie behind what was one of silicon valley's hottest startups. the man who blew the whistle, next. this is bloomberg. ♪ ♪ emily: it was supposed to be the silicon valley startup that would revolutionize the medical industry, making its investors very rich. with just a pinprick of the blood, theranos was heralded as a lifesaver that would diagnose diseases requiring more complex tests. there was one problem, a big one, it was a lie. it had a peak valuation of $9 billion and had a charismatic leader. a wall street journal reporter began exposing their nose and its fantastical claims and now the company's future is perhaps nonexistent. the

even sheryl sandberg says this has been bumpy. there havehe says been delays, publishers, nonprofits, book authors, anyone who wants to promote something about what of these broad political issues facebook is wanting to put in the ad archive. the archive will be the searchable database of political ads we can go back to for several years. of these advertisers, especially smaller ones, have been totally blindsided because they did not consider what they were doing to be political. political issues include anything from education to poverty to emigration, and that is a very broad set of things. it's not just candidates running for office. news organizations have been pushing back on these new rules. is anything changing? facebook says what they are going to do is divide them from the rest of the political ads in the archive. they do not really want to draw this isdline and say news and this isn't because there's a lot of news on facebook that is slanted or, you know, for a political -- a particular gender or something masquerading a

emily: which is interesting because elliott has already's been perceived as sheryl sandberg's person.ou have a slightly different read on this? do you think this is because of all of the trouble over the last few months and perhaps a failure on his part to deal with it? david: whether it is him alone or eight more systemic problem is hard to determine. by the way, something he has worked hard to maintain. i think clearly if you look at his roles, there have been significant failures for the company on both accounts. gettings not just about the ration -- the regulation you want. bringing the message back into the company and helping it adapt to the world in which it is operating. i don't think that has gone well at all. head of pr is supposed to be the guy who makes the world feel good about company and that is not what has happened. cheryl, mark and looking at the net result of his leadership in those two areas, i would have to say as much of him and he has been effective, it is not working now. one thing i wonder, considering how close he has been to sheryl sandberg is how comfortabl

it's if it's him or sheryl sandberg somebody is advising them to basically betray their agreement with the two founders now the two founders of whatsapp in their agreement with zuckerberg with facebook did install it basically a clause saying that if you start to use ads we can basically sue you and we could leave without penalty but it turns out that there was actually another clause hidden in there that they didn't quite know your whole other idea from the winklevoss twins ok yeah there's no evil character and now he's destroying this entire industry ok so what's happened is an easy acquisition for because the two apps have very different founding principles jan koum one of the co-founders who grew up in ukraine believes deeply in privacy zuckerberg thinks that the more open and connected we are the happier we will become and so in order to acquire what's abse i could not only had to pay a lot of money and give up a board seat to coom he also had to make a lot of promises some of those promises were even enshrined in the acquisition agreement if facebook imposed quote monetization an

facebook's sarah samberg -- sheryl sandberg testifies in europe. we will talk

moral character well it's really ok but felix salmon says he doesn't know if it's if it's him or sheryl sandbergsomebody is advising them to basically betray their agreement with the two founders now the two founders of whatsapp in their agreement with zuckerberg with facebook did install it basically a clause saying that if you start to use ads we can basically sue you and what we could leave without penalty but it turns out that there was actually another clause hidden in there that they didn't quite know your. idea from the winklevoss twins ok yeah there's no need.

mark zuckerberg and the old fellow board members sheryl sandberg criticized the family separation policy and pledged to use the social media giant to stage a multimillion dollar fundraiser for immigrant children. yes corporate apoc received knows no bounds even when it comes to traumatize families and abused kids i would start watching the hawks. to. get the. real thing. as it were to pull out of it. what they like you know that i got. the. welcomer on the watch of the hawks i am tyrrel but for them to have a long list. and i wish i could say i was shocked but we see this more and more and this is the point where people go how could you say this how can you say that what sort of ers who are good spirits superior you spending up now and you're like no no no seriously facebook reuters these are people are profiting off of the internment of refugee yes and their children are images me a lot like when you get to work at work you know you have those stories were written in that you know when to dust off your history book and you hear those stories that aren't talked about that often of like y

moral character well it probably ok but felix salmon says he doesn't know if it's if it's him or sheryl sandbergsomebody is advising them to basically betray their agreement with the two founders now the two founders of whatsapp in their agreement with zuckerberg with facebook did install it basically a clause saying that if you start to use ads we can basically sue you and we could leave without penalty but it turns out that there was actually another clause hidden in there that they didn't quite know yet what the idea from the winklevoss twins ok yeah there's no evil character and now he's destroying this entire industry ok so what's happened is an easy acquisition for because the two apps have very different founding principles jan koum one of the co-founders who grew up in ukraine believes deeply in privacy zuckerberg thinks that the more open and connected we are the happier we will become and so in order to acquire what's abse i could not only had to pay a lot of money and give up a board seat to coom he also had to make a lot of promises some of those promises were even enshrined in the a

mark zuckerberg and the old fellow board members sheryl sandberg criticized the family separation policy and pledged to use the social media giant to stage a multimillion dollar fundraiser for immigrant children. yes corporate apoc received knows no bounds even when it comes to traumatized families and abused kids i would start watching the hawks. to wonder what. the. real thing would be. as it were the bottom. like you that i got. this. week so. welcome aboard the watch of the hawks i am tyrrel but damn top of the law list. and i wish i could say i was shocked but we see this more and more and this is the point where people go how could you say this how can you say that what sort of words you are going spare superior spending up now and you're like no no no seriously facebook reuters these are people are profiting off of the internment of refugees yes and their children are everybody's be a lot like when you get to work at work yeah you know those stories were written in the you know when to dust off your history book and you hear those stories that aren't talked about that often of lik

sheryl sandberg, who iumber two at facebook, marissa mire, but they had not created their companies.zabeth holmes was going to be the first tecas founder who w a woman and who achieved great riches. >> do you think she was intentionally trying to mislied investors or was she consumed by her own ambitions and thoug c shld make it happen? >> i mean it is a mixture of both. this is not a madoff long con, you know. madoff essentially decided i the late '80s he was no longer really investing money and bui a poncy scheme. elizabeth holmes when she dropped out of stanford had a vision and set about creating a company and hiring people to make the vision happen, but along the w encountered setbacks as entrepreneurs do, and refused to admit the reality of those setbks and continues to overpromise to investors. w got to a pointhere the gap between her promises and what she said she had achieved techng ally and what the reality of the technology was got so enormous that ty the timy went live with the finger stick blood test in wall green's stores in the fall of 2013 it co had a massive fraud. e

moral character well it probably ok but felix salmon says he doesn't know if it's if it's him or sheryl sandbergsomebody is advising them to basically betray their agreement with the two founders now the two founders of whatsapp in their agreement with zuckerberg with facebook did install it basically a clause saying that if you start to use ads we can basically sue you and what we could leave without penalty but it turns out that there was actually another clause hidden in there that they didn't quite know your whole other idea from the winklevoss twins ok yeah there's no evil character and now he's destroying this entire industry ok so what's happened is an easy acquisition for because the two apps have very different founding principles jan koum one of the co-founders who grew up in ukraine believes deeply in privacy zuckerberg thinks that the more open and connected we are the happier we will become and so in order to acquire what's abse i could not only had to pay a lot of money and give up a board seat to coom he also had to make a lot of promises some of those promises were even enshrined

emily: people like sheryl sandberg, who i sat down with several weeks ago reiterated their support foreadership. >> i believe deeply in mark. mark had a vision or what social services and social serving could be. that remains important. mark, along with me and all of us, takes full responsibility for what is happening here. facebook already has seven independent directors on the board. why is that not enough? >> for is a difference between vision and good corporate governance. what we have seen at facebook is a cautionary tale on how not to structure corporate power. at this point, there has been scandal after scandal. i will give you an example of our engagement with the company. gender pay equity, we have engaged with them for over three years. it is surprising to me that of the 10 tech companies that we have engaged, facebook is the only one not to publish the data that we have been asking for in light of his position on women. the second engagement that we have had with them has been on fixed news and election interference, what we are calling content governance. that is ine platfo

carey swisher sanity do you with some of the most -- and how sheryl sandberg responded to questions aboutal impts why wasn't anyone fired? and who should have been fired? >> we want we're sorry, but sorry is not the point. the point is action we're taking. on all of these fronts we're thinking about the responsibility we take in a very different way. where we are is really understanding the responsibility ref to more proactively see the problems and prevent them. >> you said we didn't see the negative parts. i don't know if you mend human beings, the idea is what is in that culture that didn't see that? your social security number on any one of thousands of risky sites. that sounhow much is it?l. well, if you have a discover card, it's free. no way! yes way! we just think it's important for you to be in the know. all right! hey... ewww! everything ok? being in the know is very good. yeah, it is. ooo don't shake! don't shake! ahhh! know if your social security number is found on risky sites. free from discover. and my brother ray and i started searching for answers. (vo) when it's time to

o of face book, sheryl sandberg, making comments on recent issues julia boorstin joins us with that.> speaking at mncht i.t.'s commencement address, power to inspire change and also its dangers. she addressed the facebook scandal issues directly. >> at facebook we didn't see all the risks coming and we didn't do enough to stop them it's painful when you miss something, when you make the mistake in all the good you're seeing that you don't see the bad. it's hard when you know you let people down. >> saying building technology that supports eequality, democracy, throwing up every roadblock against hate and deception. carl, certainly continuing her apology tour here for those issues in that cambridge analytica data scandal back to you. >> julia boorstin, thank you very much. we'll take a quick break and back out to quebec city for the g-6 plus one summit when we return stay with us ♪ approaching medicare eligibility? you may think you can put off checking out your medicare options until you're sixty-five, but now is a good time to get the ball rolling. keep in mind, medicare only covers

, the question here is how much control does it have over its ecosystem, as we discussed with sheryl sandbergand it feels like not much in a lot of ways. just to have these relationships is fine. they have to they absolutely have to. it's how they conduct them that's the issue. >> tim cook obviously tried to loudly distance himself from this type of use of data and its reveal by the new york times that apple had a data-sharing relationship with facebook is that undermining kind of the tone that we heard from tim cook a month or two ago >> i think that he did say -- i think the quote in the story, if you read it, was that they were using it to allow you to post photos one of the problems with this is the ability to use these features like to post photos without going into the app and to work with the phone requires a lot of datea the question is, whether it's all over the pce, who is responsible for making sure it's not abused and i think that's more the issue. there's no way you can use a facebook app on any of these phones without access to some of its data the question is how much of its da

, more insight about the 5ds they are s ads they are seeing as well as who is paying for them sheryl sandberg speaking here today saying the company in her words is deeply committed to transparency and taking steps to put more transparency around what they are doing. so for example they expanded their so-called view ads program. this that allows you to see every ad currently live that a page has run they also talked about this new what they are calling active ads section. so you could actually look at an ad, see where it is running and then report that ad if you think it is bad, if you think that it is violating company policy. of course we all know taking a step back, this is part of the company's broader effort to introduce more accountability, more france parns city on ttrane sharp criticism from investors and lawmakers after the election where millions may have seen ads created by russian-backed trolls sheryl sandberg now saying that she believes with these updates that facebook is more transparent than any ad platform out there. but they are not the only ones in the news today. twitter a

in april, savanna asked facebook coo sheryl sandberg e possibility of users opting out of sharing dataopt out. not one at the highest level. that would be a paidproduct. >> reporter: the california law allows for comny to compensate consumers for their data. in a statement to nbc news, facebookreiterates they do not sell people's data and while they say it's nott, perfhey do support the california law, and look forward to worng with policymakers to protect consumers and promote responsible innovation. but a trade association whose members include facebook, amazon, google and microsoft tells nbc news it's concerned about the lack of public discussion and process surrounding what they call a far-reaching bill. >> and how did these tech t companies a public, users, how do they feel about the new regulation? >> reporter: a mixed reaction. says theof california law actually utterly fails to protectva p basically it doesn't go far enough. all eyes on silicon valley. ,the questi will they only change the way they run things for users here in california or overhaul the way their business model

in april, savannah asked sheryl sandberg of the possibility of users opting out of their data altogethert. that would be a paid product. >> reporter: in a statement to nbc news, facebook reiterates that they do not sell people's data. and while they say it's not perfect, they do support the california law and look forward to working with policylamakers protect consumers. but a trade organization, whose members include facebook, google, amazon and microsoft, tells nbc news it's concerned about the lack of public discussion and process, surrounding what they call a far-reaching bill. >> how do the tech companies and the users feel about the legislation? >> reporter: it's been a mixed reaction so far. the aclu of california says the law actually utterly fails to protect privacy. it doesn't go far enough. and now, all eyes are on silicon valley. the question is, will they only change the way they run things for users here in california? or will they overhaul the way the business model works nationally. >> thank you, jo. >>> straight ♪ ♪ the things that matter most happen one morning and one