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Now, want to get to what was a red sticky here at Bloomberg about two hours ago. This is when a big headline crosses the Bloomberg terminal.
And that's that Amazon has submitted an offer to purchase TikTok. The company submitted a bid to the White House to purchase the app from its Chinese owner. This according to a perfect person familiar with the matter. The company did send its proposal to Vice president Jad Evance. He's heading up efforts to help facilitate a sale of the video platform. Commerce Secretary Howard Lutnik two. This, according to the people, so with what we know and why Amazon might want
TikTok with us. As Bloomberg News Technology and e commerce reporter Spencer Sober, he follows Amazon very closely been reporting on this company for years, he joins us of course from our Seattle bureau. Spencer, why would Amazon want TikTok? What would it do with TikTok?
So if you think about it in the most like the simplest terms, right, people spend a lot of time on TikTok and people spend a lot of money on Amazon, and both of them have been trying to kind of
become more more of the other. So if Amazon were to gain We're to buy TikTok, it would be very beneficial just in terms of having people's attention where you know, right now they've got a lot of wallets share, but it's really a site where people dip in, buy what they need, dip out, which you know, which has been
very good for Amazon. But if it could get people to linger around and be entertained there, all the better, you know, people spend even more and its advertising business will be will be that much more lucrative.
You know, I think about kind of the merge of commerce right with TikTok. To me, it makes a lot of sense.
Is that a big part of it?
Spencer?
Yeah, exactly. You think about like Amazon is a place you go when you're ready to buy something right, You don't really you don't really go there to kill time. You don't really go there to be inspired or discover things. But those are things that you do on TikTok. You might just kind of scroll through TikTok to kill time or follow people you think are funny or entertaining, but you also see products on there, you know, And so TikTok is really trying to be a destination for discovering products,
which Amazon never really has been. So that would be kind of the you know, the match that Amazon would be looking for.
Not to say though that the company hasn't tried to make it a place to discover with the social first videos and the option in the app to sort of have that content that's generated to try to create this social shopping experience and certainly not something that I spent a lot of time doing, but Amazon is certainly trying
to do that. Hey, spencer, before we let you go regulatory issues around this, potentially, especially with regard to their past contentious relationship that Bezos had with this administration.
Yeah, well that's what you think about. You know that they're under any trust scrutiny, and they you know, there was any trust scrutiny about them buying like eye Robot, you know, so this would be like a massive, massive acquisition.
And does that does is there like a new age in the Trump administration that would be more favorable to these kind of big deals, And especially since the administration is directly involved in making this happen with jd Vance kind of running running the show and running these bids, that that makes it more possible for Amazon to swing big on acquisitions.
One thing I wonder the bid first reported by the New York Times. You guys to hear at Bloomberg reporting this at that it's not being considered seriously by the administration. According to one person in the know, the company has declined to comment. How serious Amazon, you know, I mean, I'm calling you Amazon because your Amazon spencer. How serious spencer should investors be taking this?
Yeah, that's the million dollar question. And there's a lot of eleventh hour bids coming in, like after the news broke about Amazon. Now there's a couple others who have been reported, like app love in and maybe some consortium
that includes like OnlyFans. So there's been a lot of eleventh hour bids and there can be reasons for companies to do that, even if they think they're a long shot, you know one, it might just give them kind of a seat at the table to figure out what's happening and how this thing might be carved up in case they end up interesting, you know, competing with TikTok. And then another reason is just to try to up the
price in the event. Hey, if I'm not going to get this thing, maybe at least make the person who does pay a little more.
That's what I was thinking, especially if Oracle is a serious bidder here, Spencer, maybe this company Amazon just wants to say, hey, we want or Oracle is going to bid for this, and we're competitor Oracle, we want them to pay more than they're going to pay.
Yeah, that's that's definitely part of the play, as well as well as some visibility into into what's happening, because this is still a very complicated process. You need you need uh, you need to approval, not only a blessing from the White House, but you're gonna need Bike Dance to buy in and the Chinese government to buy in. So there's a lot of players here, and some you know, I imagine anyone, you know, if they think they're a
long shot. They just be curious about what the heck's going on, and putting in a putting in a bid might give them more visibility than sitting it out.
But we should know something at least by Friday, right April fifth, because that's the deadline, is that right, third?
Fourth?
Fifth?
Actually Saturday?
I think it is, right.
So sometimes you just got up the calendar, open out.
And that's the and that's the second that's the second deadline. So he knows if we'll have another deadline, you know what I mean. It's like these these deadlines can come and go. But but yeah, that's the that's the date for now, and supposedly there might be some news coming today about it.
Yeah, we understand that the president is meeting with his advisors about it, right. Thank you so appreciate it. Spencer soper As to mention, been following Amazon for so many years, understands this company's Bloomberg News Technology and e commerce reporter. Joining us out there in Seattle.
You're listening to the Bloomberg Business Week podcast. Catch us live weekday afternoons from two to five pm Eastern Listen on Applecarplay and Android Auto with the Bloomberg Business app or watch us live on YouTube.
Okay, so everything we've done for the last couple of weeks has certainly been through the lens on the backdrop of US tariffs. It's something that touches all of the investment in business worlds, including potentially the AI investment world.
And today at Bloomberg headquarters, our Bloomberg Intelligence team is hosting Bloomberg's fourth Generitive AI Conference, and it's an event that looks at Jenai posts the Deepseek news earlier this year and Carol as a reminder for all of us that really shook up the narrative around the AI build out.
Absolutely, we are featuring a couple of speakers from the event, and that includes our next guest, delighted to have with us, Dave Brown, vice president AWS Computing and Networking at Amazon Services, joining us here in studio. Dave, good to have you here.
It's great to be here. Thank you for having me.
There's so much going on there is I do need to ask you. We know this isn't your world. Nothing happens in a bubble. You were just listening to Spencer. I thought I saw you chuckle at one point. The report about Amazon putting in a last minute bit. You know, I think about AI, it is about content, it is about data, and I just wonder how might a social media site like TikTok makes sense in an AI world, you know, whether it's at Amazon or somewhere else.
Well, you know, in terms of Amazon's bid, that smells something I'm able to comment about. Obviously, no madmoster corporate about this, nothing at all.
I walked into the studio and I saw the news.
So but you know, Bikedons has been a really good customer of AWS and honestly a customer that's actually used a lot of compute and he's now using a lot of AI. And one of the things very excited about what they've been doing, and unrelated to any of the news that you might be reporting, is they've used a lot of the customer accelerators that we've that we've built at AWS. One of the challenges with AI, and you know,
is how do we get the cost down? How do we make sure that it is affordable for every company out there that thinks they could use it in some way that would change their product. But really we have to be able to get the cost down. And one of the ways we can do that is through things like you saw with deep seek, improving the models, making the model simpler than making them easy to train. But the other way is to build different silicon, build silicon
that's able to get the cost down for customers. And so Biketones has been a big user of our custom silicon in the very early days of Inferential which improved inference models. They've also consumed Graviton, which is our customer on chip, and they also using our Trainium chips as well, So we work very closely with Byketons.
From that point of view, how do you make sure that you keep a company such as bytans as a customer when there is so much competition in this space?
I mean, think about it from the.
Perspective of the three biggest players you of course Microsoft, Azure and then Google Cloud and we've seen a big investment. We'll talk about that for Google just in the last couple of weeks. How do you make sure that you stay ahead in your view of the pack and keep these customers from jumping ship.
I think there are a few things. I think one of it is innovation. You know, the cloud has just brought an enormous amount of innovation in to the corporate world.
But some people might look at this and say, is this a commodity at this point?
I don't think so, because my next point would be execution. An execution really rarely matters. It's one thing to say we have a hard.
Mean I feel like no.
For yeah, absolutely executive execution all the time.
What does it mean in your world?
Well, what it does mean is, you know, bring running AI. For example, so the servers behind AI, whether you're running an Invertio GPU or you're running some customs Silicon such as our Tranium chip, they're not easy machines to run. They're incredibly complicated, they're incredibly hard to make sure that they're highly available, and they also need incredibly advanced networking capability.
So we've had to build network capabilities to be able to bring hundreds of thousands of these accelerators together in a single cluster. Now at AWS, we spend a lot of time making sure that we provide those clusters and those those systems to be as highly available as possible for our end customer. And so when you choose your technology, if you're running on a you know, a solution, whether it's something you've built yourself or a provider, and that's
not working for you. That's what I mean by execution. It has to be flawless and it has to work, and at AWS we think that's one of the ways we're able to differentiate ourselves.
Are you at all worried about overbuilding? Like obviously with Deep Seek, the narrative all of a sudden, like in a heartbeat, switched in terms of, well, maybe we can do this more cheaply, maybe it doesn't require the buildup that we've been talking about for more than two years. Are you worried about overbuilding? Are we possibly in a bubble when it comes.
To well, I think from our point of view, Sydney, Well, from our point of view, we're not really listening to sort of the narrative. I think the narrative is very interesting. We've been following it. What we're listening to is customers and what a customers want to do with AI. There certainly no shortage of customer demand for the chips right, whether it's in video chips so uncustomed silicon you've seen partnerships.
No doubt about that demand. And the demand is smart because it's being put to use and it's going to be monetized. Yeah, no, worry.
Well, I mean the other thing is you just have to you have to make good investments. And so the trick is to say, what are we building in terms of customer demand? Not are we building in terms of the narrative? And I think from a customer demand point of view, it's very very strong. We expect it to continue to grow, and we're very comfortable with the investments that we're making.
So it brings us back to the way that we started this conversation. We're speaking to you on Wednesday, April second, ahead of President Trump's announcement that's set to come at four pm Wall Street time from Washington, DC, So we don't know what he's going to say at this point. How do you watch an event such as that? How do you watch tariffs? How does that affect your world?
Yeah?
I think one of the things when you're running what is probably one of the largest supply chain supply chains in the world, right, we have to think about every single component, whether it costs a few cents or it's millions of dollars.
Within our You're talking about.
The aw aws, not the retails, not the retail session it's certainly effective.
The retail side is.
Certainly helpful to us, and it's taught us a lot about how to run an effective supplies right and so on the AWS side. Running a supply chain, we've got to think about every single possible outcome, you know, the sort of things that you're talking about now with regards to track tariffs or you know, global uncertainty, whatever it might be, we're going to think about how they would
affect our supply chain. And we've put mitigating steps in place, and we're thinking about these as we to make sure that any outcome means that we can still serve our customers. What are some of those mitigating steps that you've put in place. There's als of things you can do from a supply chain point of view. A lot of the sil can manufacture ourselves. We always think about multiple multiple suppliers, like are you stockpiling this stuff right now? I don't
believe we're stockpiling. But there's many many things that we're doing to ensure that we're going to be.
Okay, such as.
Such as making sure that we have multiple locations for service, such and making sure that we have a cost structure that we think is maintainable for our end customer. It's just it's supply chain technology based.
Is most of your supply chain safe in terms of let's say it's an all out trade war.
The reality is I think in the IT space that we're where depending on global supply chain, not just a
WS but the world. But our chips are made most of them are manufactured in the Far East, most of the you know, the technology and cloud comes from the US, and the realities we're living in a global supply chain and we're going to have to take whatever the announcement might be later today and understand how that affects the supply chain that we've built out to be as redundant as it possibly can be.
But we're going to have to see what happens.
Is there a spectrum in terms of the cost hit that you think you could take as a result of these tariffs.
That's not something that I think we've been discussing. I mean, I think there will be things we'll have to think through, but I don't have any sort of spectrum in mind.
What about thinking about raising prices for customers as a result of higher inputs.
You know, that's that's something I think a similar situation would be the sort of the energy prices increases that we saw, you know, during the COVID time there was energy shortage and slightly off the COVID in Europe, and that was a big question back then, as you know, is able is going to raise prices because we've we've
seen energy prices spike in Europe. Other providers did raise prices at that time, and from an als point of view, we were able to actually not raise prices on our customers and ride out that increasing commodity prices and we were able to get back to, you know, a better cost structure for ourselves after this, and that's really what we're looking to do. We'll have to see what happens later today and see how supply, how supply chain holds up.
I'm also curious about deep Seek in terms of, you know, what might be a more efficient AI model, how that is affecting the design of your own chips at aws and kind of how you think about how AWF offers compute and compute services and so on.
Yeah, deep Seek itself, you know, it was good technology.
It came out. I think it surprised a lot of folks.
We're expecting to see these kinds of significant improvements step FUNCTIONINGY, you weren't shocked by deep seek, Well, certainly the news it wasn't something that everybody knew about. But what I wasn't just shocked about is that we're going to see these these order the magnitude improvements in models. I'm expecting more like the technology is so new still and we
are going to see massive improvements. And I think you know the one thing is when you do see a cost reduction in these models, what it does do is it unlocks companies to be able to deploy more and so why it's cheaper to do it just means that you can do more of it.
And that's one of the reasons why we're not.
Worried about some of the investments we've made because we can see the demand. We know if the price goes down, our customers are.
Going to do more.
They're going to change the user experience for more of their customers, and so you know, that's what really excites us.
About the opportunity really cool stuff.
Great to talk with someone like yourself who's kind of front row seat to all that's going on in AI.
Dave, thank you so much ye, thank you for your time.
Dave Brown.
He's the vice president of a WS Computing and Networking at Amazon Web Services.
This is the Bloomberg Business Week Podcast. Listen live each weekday starting at two pm Eastern on Applecarplay and Android Auto with the Bloomberg Business app. You can also listen live on Amazon Alexa from our flagship New York station, Just Say Alexa played Bloomberg eleven thirty.
All right, now, let's get to some of the news that certainly has caught our attention. This has to do with New York City Mayor Eric Adams, and that is that a federal judge dismissed corruption charges against Eric Adams, bringing a permanent end to the case and capping an extraordinary series of events that so discord within the Justice Department.
With more on the judges ruling, we turned to Bloomberg's legal reporter ABA Benny Morrison, who joins us from New York. What exactly was this ruling? Is that it everything thrown out?
It certainly looks like it. The judge really took his time considering all the arguments that have been flying out in the courthouse over the past few months, and he reached the decision today that everyone had been anticipating that he was going to dismiss the case against Eric Adams without prejudice. Now that last bit is important because that
means this case can't be revived on the track. You may remember that the Justice Department in Washington had wanted to dismiss the case with prejudice, which would have given it the option to bring back the case against Adams if they felt the need to, and this led to concerns that Washington wanted to maintain leverage over New York's mayor, which didn't seem to sit well with the judge.
It's interesting too, because in that ruling, the judge criticized the effort by President Trump's Justice partn't to leave the refiling option open.
What is that?
Yes, he referred to this situation as unprecedented, and it was certainly something that I haven't reported on before. Judge said that it was very clear that everything here smacks of a bargain dismissal of the indictment in exchange for
immigration policy concessions. But he warned that dismissing the case without prejudice would create that unavoidable perception that the mayor's freedoms depended on his ability to carry out the president's wishes, so that's why he decided to dismiss the case without prejudice.
So basically, the mayor can do whatever he wants right in terms of even whatever he agreed to maybe with President Trump, because he doesn't have to worry about every filing.
That's right.
He doesn't have this case hanging over his head anymore. So some may argue that he doesn't have the pressure of having to do what Washington wants him to do. But you know, we saw him today outside Gracie Mansion and he was holding out a copy of FBI Director Cash Ptel's book Government Gangsters, which is very critical of law enforcement. So we've had little indications from him over the past few months of him kind of edging closer
to the current administration. Whether he decides to continue that sialance we don't know.
Is that the book just is that the book with the list in it of people.
I'm not sure I know that the book. In the book, he's been quite critical of law enforcement and the way they go about things, and Adams made the comment that he had to turn to that book to fund the rationale for the DOJ bringing the case against him.
Twenty seconds.
All of his legal problem we know his political challenges are his legal problems. Over twenty seconds.
It certainly looks like it for the time being. He may have avoided a criminal trial, but he's still facing an uphill battle when it comes to politics. He's buying, He's facing several candidates who want to unseat him, and a string of polls have put him losing the primary election.
Yeah. Quote, A public opinion can be pretty rough, especially when your New York voters or New York City voters. Ava, thank you so much, and I see with admiration. Ava, thank you so much.
Ava.
Benny Morrison, legal reporter at Bloomberg joining us romacle.
How about you let me drive?
Oh no, no, no, no, this is not a toy job.
All right, please gravels excuse me.
I want to drive.
It's good question.
This is the drive to the clothes punk's amusing well dry run on Bloomberg Radio.
All right, TikTok everybody you just got have TikTok, TikTok?
Oh exactly?
It's like, is it because the Amazon thing is at the Financial Times report? Why are you tiktoking right now. Yeah, maybe you're just like ttok okay.
TikTok to the clothes and TikTok TikTok until we get from the president right what he's going to lay out in terms of terrorists. It is expected at four pm Wall Street time, so we are just about eighteen minutes away from that as expected if everything goes on schedule, and also just about eighteen minutes away from the closing bill. As you heard from Bill Maloney and Charlie Pellett. We are up about six tens of a percent on the
S and P five hundred, folks. We're definitely off our loads of the session and off our highs, but a little bit of a leg up in the last half hour. So down John's Industrial average if you care, up two hundred and thirty points, up about half a percent. Nasdaq one hundred, where you find all those big cap tech names up about eight tens of a percent tim again of about one hundred and fifty one points.
I'm curious how Noahman is watching this. He's founder and CEO of Advisor Shares. Noah you argue that we got to look at Trump's first term to understand equity market implications. But as our own end o'current reminded us a little earlier in the hour, this could be way way bigger. In fact, these measures could mark the biggest protectionist move in ninety years. Are there still lessons from the first term?
I think so. The first big lesson is to remember he threatened a lot of tariffs and then pulled back on Mexico and Canada. China's harriffs at the time on I think aluminum steel continue to remain in place, So any minute, any people can change their mind. I think I was just seeing something pop up about even Canada suggesting they would remove their terrace in return for us
removing all of our terrasts. So I think the thing to remember is anything can change in a minute, and when we look back at what happened back then, yet a volatile market, but overall the market continued to climb. The challenges it saw at that time are far more about fed tightening, I think, than anything else.
So are you on hold though? Do you want the details before you figure out kind of what to do next?
I think so? Or depends on what kind of investor you are, right, if you're a long term investor based at least on history which may not repeat, of course, But I might continue to do what I'm doing right my monthly four to one K deposit, I'll allocate it to the market. I'll sort of buy this dip that we've seen going on in the US markets. I might start to look a little bit more at international markets.
Not as much about.
Terrace, but they've been strong this year. That's been one of the bright spots. Is you know, Epha's up I think almost six or seven percent. So is Aqui Xus. So if you're a long term investor, I think I'd just probably not worry about it too much. Expect volatility. If you're a trader, you might be, you know, thriving on an increased volatility.
No, there are some folks out there who are concerned about the fundamentals of the US economy. And I'm talking like structural here, like something could shift substantially unlike what we've seen really in our lifetimes. I've talked to friends who are not involved in the markets on a day to day basis who said I'm getting out of the US. I'm going to cash or other friends who say I'm going overseas now with my money. Again, these are not
what I would call sophisticated investors or traders. They're just really thinking differently about asset allocation. What would you say to them?
So, I would say the idea of moving international just again, given what we've seen happen earlier this year, and it just feels like it's time for international markets. They've been underperforming for so long. That's probably not a bad idea. But the market's what five, iver six or seven percent off of all time highs. And if you're selling your portfolio go into cash, don't forget that tax bill that's
coming as a result of that. So, you know, if that makes you feel comfortable, I think that that's fine. There's nothing wrong with that. Again, consider those tax implications. But if you think it's going to be a lot worse, then you don't mind paying the taxes on it. But I think otherwise, you know, I'd be a little cautious. I just it feels like the news changes every minute, every hour, and I would not probably make big abrupt changes until I have better clarity.
You know what's interesting is Noah, I think we're all waiting to see if the negative sentiment that we've been talking about so much. We've talked about cap x by businesses pulling back consumer sentiment. We've already seen the airlines talk about cutbacks, but again they've been talking about the current quarter and not necessarily for the rest of the year.
Sentiment becomes a problem when it, though, does turn into actions and people stop spending, Companies stop spending, companies stop hiring. How much do you think that sentiment will turn into negative action and be with us for the rest of the year. Are you more upbeat about the rest of twenty twenty five or the second half of twenty twenty five in general?
I'm more upbeat, But you're picking your spots, right. I think ADP just came out with some surprisingly high numbers, right. I think it was one hundred and fifty five thousand private sector jobs. There's been plenty of announcements of international companies making capital investments in the US for big plants and manufacturing.
Right.
In part part of this plan tarif.
Drama plans, right, commitments plans, But it doesn't mean there'll be a reality.
Right, excellent point. But I think if it's not a reality, then you know, things can probably go both ways. Right, Maybe things won't be quite as bad here, but you do see it in pockets. When you mentioned things like airlines, I think, yeah, it wouldn't be surprising to see much more business travel cutting back with a little bit of uncertainty. We've already seen reports, especially along the Canadian.
Border, where they're.
Not too happy with US as of lately, and they're cutting back. You know, travel plans where they come here and they spend and they go to amusement parks or they stay at nice hotels, and so you see things like that cutting back. But if some of those plans turn into real jobs, it could create a production growth opportunity within the US that will still be several years out, but could really create long term opportunity. But boy, is it going to be noisy involved along the way.
Yeah, And look, I think certainly the cutting back that we're seeing from international tourists to the north makes sense. Something Carol and I have talked a lot about, especially in the context of some of the airline downgrades that we saw this week from Jeffreys. And the pullback that airlines have talked about is a cutback that American consumers are feeling in discretionary spending, are you seeing that pop up at all.
A little bit. You know, you've seen weakness in that hotel sector. You've seen weakness, as you mentioned just a
second ago, in airlines. I think, you know, there's vices, right and when I think about things like Corona beer and the impact and maybe people are going to spend less if the price of that beer is going to go up, Well they can still you know, buy some sam Adams that's made you know, made in the US, and those prices won't go up, or at least they won't go up to the extent that they're not affected by the supply component, right, the metal that's made in
their cans to distribute their product. So you know, yes, you've seen some consumer spending pulled back, certainly pulled back with the market. But same thing. It feels short term, it feels temporary, but always subject to change.
So in terms of dip buying, have you been doing that on the pullback?
I have, Yeah, absolutely so. Right now, I really haven't changed my asset allocation that much except for what I mentioned earlier, which is I'm leaning into the international markets a little bit more. I'm also looking at where maybe we might see interest rates maybe going down, which could provide a spark and some ignite, you know, some opportunities
in the US. The best spots, it seems like this here has been energy and financials probably, but for the most part just I'm continuing to dip by not going to worry about it too much. And I think, as you guys were saying earlier, I need to see what really happens before I take too strong of an action.
All right, Gonna leave it on that note.
Noah.
Thanks.
Noah Hammond, founder and CEO of Advisor Shares joining us on this Wednesday, folks. We've just got about ten minutes to go, taking a look at the trade. Definitely off our worst levels of the session. Green across the screen, s and p up about forty points. Now's de Q one hundred, a gain of one hundred and sixty two. Stick around. We're counting you down to the clothes on this Wednesday.
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