From Marhart.
We're Innovation, Money and Power Collne in Silicon Valley, NBN.
This is Bloomberg Technology with Caroline Hyde and Ed Love Love.
I'm Caroline Hyde at Bloomberg's World headquarters in New.
York, and I'm Ed Lovelow in San Francisco. This is Bloomberg Technology.
Coming up, Amazon, Meta, Apple all out with their latest earnings. We'll dig into the latest results from Big Tech.
Plus Vision pro hits stores. We'll take a closer look at Apple's latest bet on the future.
And an exclusive interview with the Nvidia CEO where he sees the biggest benefit from the AI boom. But first, let's get straight to some of these big moves. When it comes to tech ed and we are record highs. When it comes to Meta, extraordinary.
Yeah, record high Meta. There's like a comparing contrast here. Apple. I kind of think it's the story we expected. They did grow overall in the quarter, gone just just and they avoided five straight quarters of sales decline. But the stock is down significantly back to where it traded in November. Why Greater China sales and Greater China missing by like three billion dollars. But the narrative on the call. Yeah, we are four of the top six handsets in urban
China in congruous messaging. We'll dig deep into the gross story for this stock, and then there is meta, right meta to me, is the story today? Probably we're on track for the biggest jump since February of last year. The stock is touching fresh record highs. Is this an AI story or is this a cyclical rebound in ads? Either way, one year ago we lamented the spending cash burn from Facebook reality labs on the metaverse, But one year ago we also said, Okay, your efficiency is here.
This is good. They're back to hiring, and he's thrown in an additional fifty billion dollar buyback and a divvy and it's a wonder what it can do for the stock character.
Funnily enough, investors like it.
And let's dig into the meta earnings and really what it says about cost discipline. Jusmin Enburg is with us some piece of say principle analyst insider intelligence, where you lead the coverage to social media the creator economy. And before we get into some of the juiciness for the investor base, what do you make of the out and out numbers? Of revenue growth at this particular moment.
Yeah, well, it's clear that Meta's year of efficiency has really paid off. Many of the measures that it took last year helped it reduce its cost, it reduced its headcount, and even with this leaner team and operations, it was really able to exceed expectations really across the board, and importantly of course, in its core line of business, which is advertising. And to me, this is really a testament
to Meta's execution power. If you look across the social landscape, it isn't the coolest or the most exciting social player out there, but it is the most sophisticated and it knows how to drive business and advertisers really like that.
Yeah, they were investing in the underlying advertising technology to better serve their clients. But what do you make of also the talk generative AI. The larmer has become basically the giveaway when you go to AI events. So much of that is a course based on their large language model, But what does it do in terms of future revenues? Jasmine?
Look, Meta wants to be an AI heavy hitter, and it is working hard and investing in AI to be able to do that.
On the earnings call. Just in the prepared remarks, you.
Heard executives mention the word AI about fifty times, which really shows how much they're trying to emphasize their work there as well as how much they truly.
Are working there.
And It's AI investments have already proved to have a positive impact on its ad business.
They talked a lot about its automated.
Tools and AI driven ad formats really driving performance. And at the end of the day, advertisers they want efficiency and they want effectiveness, and those investments have really paid off there and that bodes well for its broader ambitions in AI as well.
I think what we're understanding Jasmine is the relationship between the ad business ANAI now right, and so Bloomberg writes in the blog, Meta is still the king of digital advertising, but what they point out is that the boost is coming from China based companies on spending in its association with AI generated content. Do you understand that relationship and how AI is basically growing interest in its ad.
Base absolutely, I mean AI of course is growing interest in its ad base and generative AI in terms of the creative tools that Meta is also rolling out for advertisers, will do a lot to prove that. I mean, the China based advertisers is a potential risk factor, though I wouldn't say it's necessarily the biggest one, because they have been buoying spending as well throughout twenty twenty three.
Later in the program, we're going to go very deep on Apple's vision pro and it makes you think about the metaquest three. You know, it is hard to keep up with meta We were a social media company and then we were a metaverse company, but it was expensive, so we stopped. And now we're in an AI company. Did you get any sense of like where the hardware fits into all of this and if the metaverse dream is still alive?
Well, the metaverse dream is very much still alive.
They didn't talk about it as much on the earnings call yesterday. Again, the focus was really on AI, and for me, the big challenge now is for Meta to be able to prove that those two big bets, one being AI and the other being the metaverse, really are complementary.
It started to lay some of the foundation for that thinking about the ray Bank smart glasses, and you know, it talked about good sales for its metaquest in the last quarter, so there are some signs of progress there still for me, you know, the meta versus is somewhat of an ill defined concept, and it's something that you know, Meta is going to have to continue to prove as
it continues to form this vision. It also has to store that it can keep up the momentum in its advertising business, or investors won't be as willing to overlook those losses that continue to mount in reality labs.
Interestingly, maybe Apple's vision pro serves as some boost to sales to Meta going forward as they help with outlining the vision. Jasmine, I'm interested though you said that China, for example, isn't the biggest risk for you. What is the biggest risk? Is it regulation?
It's certainly one of them.
I mean, just this week as well, CEO Mark Zuckerberg testified in front of Congress about protecting children online. That was a really heated conversation and it's clearly going to be.
One of their biggest challenges this year.
Teen popularity has become, you know, somewhat of a liability, at least in the eyes of lawmakers, but young people also represent Facebook and Instagram's largest or one of their largest, really opportunities for growth.
And it's going to have to walk a really fine line.
In terms of protecting their safety on these platforms and generating revenue. There's also, of course a lot of other regulated regulation that Meta has to think about, both here in the US and in the EU.
And then there's the digital ad market.
You know.
I think Meta was able to allay some concerns already in the earnings call yesterday, but it is susceptible to fluctuations in the economy that really can impact advertiser demand.
Jasmine Mberg, principal analysts over in Insider Intelligence, with the Meta story, thank you very much. Let's get to the Apple story and Apple earnings with Dani's, senior analysts of equity research at web Bush Securities, Danish real quick. The stock is pairing its decline were now six tenths of a percent. We had been down significantly more. What is the story? A return to growth overall or China is a problem.
Yeah, I mean the streets reading through this is iPhone growths coming back next quarter is essentially massively conservative guidance. And now you have AI coming into the Apple store, so Jo nor One's selling Apple heading into that narrative, and in my opinion, this is the start of the renaissance of growth or.
Apple conservative guidance. So I mean go back, like what we hang on are the words of Luca Maistreet. Basically he said that that December quarter would be essentially flat. We ended up with slight growth overall and weakness in China. You know, we're not talking about like a big rebound here, Dan, We're talking about them staying out of five consecutive quarters of growth declines. If there is growth, where does it come from.
What our view is you don't need to have hypergrowth and iPhones row to mid single digit iPhone growth is really what you need. Services is the key to evaluation one point five to one point six trillion. And then look at their active in Starblands when they just need the update two point two billion. So you now have that that golden and stall base and now you're selling AI and so that that's a narrative that in my investors are just going to continue to sit here and buy up the depths.
So when you're looking at the overall strength of new products, Dan, there has been so much hand ringing about the iPhone fifteen, then today we're going to talk about it.
A lot.
In a moment the Vision Pro goes on sale. How much is that in any way going to be a catalyst for liking Apple's tech because it was under pressure when we started to think about, well, the fact that the overall watch was pulled and we questioned ultimately the underlying technology of Apple.
Look, I think, but again again and Apple continues to count out. I mean, you will talk more about the Vision Pro, but originally we had three hundred thousand units for Vision Pro. Now we think for the year it's six hundred two thousand and two years from now, I think this is a sub fifteen hundred dollar device that's going to look like Sunblosh. And it just goes back to the form factor and why you own Apple here some of the parts. I believe a year from now, it's a four trillion dollar market.
Okay, So give us that catalyst. Give us what is it a slow grind, a slow belief, a commitment of investors, or is there something that snaps down that makes us rebuy and decide to drive the stock back to a four trillion Well.
I think it's the AI app store, we believe starts to get talked about it. WWBC in June and then iPhone sixteen as well as iPhone seventeen. They're gonna have more AI technology, generative AI driven into that. And then you look at that install based two point gwo billion. There was one hundred million more than we were expecting. This is the start of a renaissance of growth. It's my view of where Meta was eighteen months ago. Street
did not realize at the time. I think eighteen months from now we worked back at This is a seminal moment.
Dan, I want to go back to China. I want to understand what's happening. This is what Luka Maistreet told us that Apple's disappointed with the decline in China, but it's a very competitive market. Compare that with what he said in his opening remarks on the call. He cited that Cantar data that Apple occupies four of the top six handset slots in Greater China in the prior quarter. They said, this isn't an iPhone problem, this is Mac and iPad where we had not had a refresh cycle.
Explain the contrast in those two statements.
Yeah, Well, there's definitely not Chimpan and Rosemes in Beijing. I mean they're clearly going through a headwinds. Huawe to geopolitical. But our view is, you have two hundred million iPhones in China and they gained three inchre BIPs of market share the last eighteen months. But Apple has been here before. They've navigated challenges again and again. So I think when you look for you've been able to do and the
installers they're basically being cautious. But I think we see growth second after the year return and we view this as more of them navigating headwinds rather than the start of some structural problem that the bears have been talking about for the last two trillion of marketcap.
Up con.
Dan, I's always great to catch up with you. Where in the world are you? We don't know. Potentially, it looks like an airport at the moment analysts of equity research where Bush Securities stay well, friend, have a great weekend. If you are coming up, we're going to be breaking down the latest numbers from the jobs report. Sylvia and Martin shivik Is can be joining our CEO of the Workforce Management Platform, Deputy. Let's go back to where these
markets are training at the moment. In amongst the earnings there is a whole load of impact coming from the macro picture. Today NASDAK drives higher one point two percent, lead, of course, by some mega moves in meta that we were just discussing Amazon doing well. We're digging into that in a moment. But the ten year yield phenomenal sell off eighteen basis points higher on the two year. We're seeing significant moves on the tenure as well across the curve.
Why absolutely blow out report when it comes to the overall job surge three undred fifty three thousand in the last month. What then, of all the tech layoffs that we've been seeing. It seems as though this economy is still going strong, and it means the Federal Reserve is unlikely to be cutting anytime as soon as March, and
certainly it's vindicated and holding rates steady. Bitcoin, as I show, actually up six cents percent despite the US dollar managing to rally on the back of those numbers that make macro data as well. But ed, this picture is so surprising when you think of our area of technology and just the ongoing narrative of job losses.
I'm just going to read the numbers again, because you're exactly right and if you've got X look at the number of finn what do we used to call it whatever? People that talk about finance on formerly known as Twitter platform finish number exactly, but it's a blowout, right, three hundred and fifty three thousand jobs added in January, higher than all economist estimates. The bulk of the data showing more employment, higher pay, and payroll increases across all industries.
I guess the question where do we sit with technology? So let's bring in Sylvia Martinshevik for her take on this. She's the CEO of Global Software Platform Deputy, which recently put out a report on the change is expected in the workforce this year. We're trying to understand what's happening
in the economy and in the technology sector. There is, forgive the pun, but an artificial thing happening with artificial intelligence, the muddies the picture of hiring, in particular your reaction to that number this morning.
Good morning, and thank you so much for having me. Yes, we are seeing that for the twenty fourth consecutive month, the unemployment rate is sub four percent. And yet you know, we're hearing so much about AI taking jobs away and what we at Deputy obsess about is how will AI impact hourly workers? These are the frontline workers, whether they're
nurses or retail workers. And what we're hearing from hourly workers, they themselves are reading the same reports, and you know, they believe that AI is going to impact and change their jobs and roles. But what we find is that in most scenarios, AI is more likely to complement specific work tasks rather than replace the workers.
And really, when you think.
About the workers that we support at Deputy, whether that again are workers and elderly care or hospitality or services, we all prefer the human touch in those jobs, and those jobs are there's still a lot of lack of employees in those jobs.
And what's interesting about your report as well, humans are still cheaper than AI in many of these roles at the moment, and well, we're still all testing artificial intelligence, whether or not we really get the implication of being able to do more with less. But Sylvia, what's really interesting this job support was women one hundred and ninety eight thousand increase in employment for women, so participation going up,
making up for a callback in men. And you had some interesting thoughts about how much AI is going to help or hinder females in the workforce.
Absolutely, we cannot talk about labor markets without talking about women. The constitute over fifty percent of hourly workforce, So this is an incredibly important topic.
And when you think about.
Historically what were the barriers to women entering workforce, we know it's childcare, accessibility, and affordability, and it's also lack of predicative But you know, at Deputy we ask what do women want from their work and how can technology enable that? And what we found is that women want more predictability and they want more flexibility when it comes
to their weekly work schedules. And you know, our mothers and grandmothers work nine to five, but women of today Gen Z and millennials, they don't want nine to five shifts, And so how can technology help that is Actually.
We believe that it can be a great enabler.
Micro shifts is one specific trend that we're seeing where women work for a couple of hours in the morning, then they take care of their kids or their aging parents, and then they go back to work and work a couple of hours at night. So that micro shift trend is something that we believe technology can help. So We really do believe that more tech in this space will provide more opportunities for women to continue to re enter workforce after childbearing.
Love a bit of optimism around the AI story on what felt like a week weather wasn't much. Sylvia mantinshevik me, thank you so much, CEO of Deputy.
It's the official release day for Apple's big bet on virtual reality, the Vision Pro.
Bloomberg.
Stavely is live from Manhattan outside the flagship Apple's store. The doors are open, it's on sale. What have you been up to?
Well, I've been here since about seven o'clock when it was slightly warm than it is now, I have to say. And at seven there was a healthy line of people waiting to head straight in and be some of the first to buy this new Vision Pro, which of course went on sale today for thirty five hundred dollars. Tim Cook,
the Apple CEO, has expected. He was here. He opened the store, came out, greeted everyone said thanks very much, and all the usual things we've come to expect from these first sales days for Apple, and then downstairs to say there's a decent amount of excitement people. It takes about twenty minutes to get this thing fitted. So people were doing that and you know, seeing all the features
were and then emerging shortly after. So it's not quite an iPhone day ed. I mean, the line is definitely gone now you can just head straight in if you'd like. But a significant amount of excitement I think for the vision pro on this first morning.
Dave as lucky enough to be flanking you at seven am and heading down there and having a chat with Tim Cook, and he seemed to be thinking that really it's the intuitive nature of this device that's got people really excited. The fact that you're just using your eyes, the fact that you're just using your own hands, you haven't got a controller. He himself also really liking the productivity use of it. But from your perspective, what do
you like about it? You've tried and I know you're a bit of an addict to the quest for example, what about this particular iteration. Well, let's see what I.
Think is interesting here, Caroline, is you know, what are we going to use these things for? And in Apple's case, they seem to you know, they're targeting extremely premium I guess, more immersive, higher quality experience where productivity and entertainment seem to be the focus. Meta's approach has been something a bit cheaper. It's only five hundred dollars compared to thirty five hundred dollars, and you can move around with it. You can do the exercise is something I think is
really fun on that device. They're two sort of different philosophies, and Apple's philosophy comes with that bigger price point as well. Where I think Apple may over time get the upper hand is that, you know, this is the V one of this product, and Tim Cook has been kind of stressing that as well, but this is a new entry for them into a new computing format. The idea that this is going to get better and cheaper, you know, that's clear and the same way the iPhone improves over time.
So I think that's what's going to be interesting here. Is not V one as we've seen today, but V two, v three. If you can come down in price, be a bit lighter, maybe less bulky, I think that would be when you can really tell whether this is genuinely a new, a smash hit, new Apple product, or whether it's something a bit more.
Niche savely doing your duty down there in rain, we really appreciate your opinion on this particular device. We thank you for it. Davely on Fifth Avenue, I said a quick check on these markets, said because, but the NASDAK manages to outperform even though we're worried about a strong macro picture. That means perhaps a federal reserve ain't going to be cunning as soon as Mart. But dig into what's driving the Nasdaq one hundred, just sea of Green.
Even Apple turns up to run well less than a point higher, but that's after their numbers showed, yes, a return to revenue growth, aching out that two percent. The market had anticipated a one percent. But remember after four straight quarters of declines in revenue, that was a standout. Despite that weakness in China where we saw revenue off by thirteen percent, but better absolute extraordinary up twenty percent, new record high, and we're still seeing of course, they're
managing to be tripling profit. They're really driving up revenue growth. They're going back to the basis of what's good at advertising as well as still investing in their AI. And then we leave you to Amazon up more than seven percent, best online sales growth since early in the pandemic. This is about quickert shipping times. It's about job cuts. This is about discipline, and we can get to it with our next guest ed.
Yeah, I think that there's a really interesting difference with Amazon, and that is principally, hey, look at the profit we're going to hit in the current course, so let's stick with Amazon. With Stephan Slewinski, global head of Software Research at BNP powabout exam and it just goes down to fundamentals. We love exciting stories metas about AI and competition in
ads and apples about China and vision pro. For me, Amazon is just about we're going to make a lot of money in the current period, and it's a lot more than the street thought.
Hi, thanks for having me on. So you're absolutely right. Aws. Amazon Web Services squeaked by with thirteen percent growth, but that was good enough. They are still losing share, we think, to Microsoft Azure, but we're seeing a recovery in cloud computing, large deals being signed, optimization ending, and that allowed for the market to focus on those North American margins, which they're able to lift and beat expectations. And I think what was important as well is with the Q one guidance,
they've actually left more room for upside. So if you look at the Q one guide eight to twelve billion of EBIT, if you assume Amazon Web Services margins remain flatish at twenty nine thirty percent, you assume internationals to loses some money, that actually implies the North American margins would go down from six to four percent. That's unlikely. The company gave us reasons why we should continue to see efficiencies there, so I think people see potential for beats coming ahead as well.
I've not ever heard of that a company guiding conservatively and leaving room for upside. I'm just kidding the thing that I'm interested into the advertising business because aws one on one with Azure, we know the competition there, but Microsoft doesn't have that right now, add business, how much of a strength is that for Amazon?
I mean, certainly the ad business plays a good part of their online business, and that's been growing healthily in the mid twenties, and that's helping that margin as well. So, as you pointed out earlier, you know, Amazon was a company that in twenty twenty two was doing sort of a one percent margin. The market thinks that that can get up towards ten percent. Here in twenty twenty five, and growing ADS is a part of that. But I do think we need to keep an eye on what's
happening with AWS versus Azure. Amazon Web Services is fifty percent of the cloud computing market if you look at just Microsoft, Amazon, and Google together, But in twenty twenty three, if you just look at the incremental revenue those three generated in twenty twenty three, actually Amazon's share was down to thirty five percent, with Microsoft Azure at forty five percent, and that's thanks to obviously the open eye relationship and
what Microsoft and Google are doing on AI. I do think that gap may close again as AWS benefits maybe a bit more from the end of optimization, but that is something to watch as some of those share losses continuing on the cloud computing side.
I'm interested in your price target an ultimate sort of neutral rating on this stop when we're thinking of one point seven trillion dollar market capitalization, that's still enormous. You see, though, what I think a price targeting correct me if I'm wrong of one hundred and fifty so below where we're currently trading. Why that conservative nature of coming from U Steffan.
We did raise that today one sixty, but we are still neutral. But we do think that all three cloud computing companies benefit this year from Jenai. So that's Microsoft Azure, that's Google Cloud, that's Amazon Web Services, and we actually think that that's a better way of playing Jenai this year than the SaaS companies where we may see some disappointments, and that's Microsoft Copilot, it's maybe Adobe Firefly or even Service now with proclus where we may not see that
revenue generation this year. When we look at Amazon versus Microsoft, we do prefer Microsoft. We are outperformed there, there is a valuation gap. It's shrunk, but you are on sort of twenty seven times earnings for Microsoft on twenty twenty five, about thirty times for Amazon, and you still do have much higher margins, of course, much better returns at Microsoft,
and probably even higher revenue growth. So we think all three will benefit, but we have to have some preferences, and that's why we sick with Microsoft.
Stefan great for that context into play for us. We thank you so much. Stefan Stowinski, Global head of Software research over at BMP parabat Exam. We thank him for it. Meanwhile, let's get back to the other big stock on Deck Capital's earnings. BlueBag Intelligence senior analyst an rag Rana joins us An Anurag. Well, the share is actually turning positive
after a four percent slump. Are we managing to counteract it with the Vision pro news or is it more that we're getting okay in fact, that China will be short term in nature.
Yeah, I have no idea. I'm a bit surprised at that too. I mean, I think the print last night basically said there's going to be very little growth this year. So it is concerning, and I don't think Vision broken
off said that. Listen, even if you sell one million units, which is way above anybody else in the world, as the model as well, that's three and a half billion in revenue Apple generates, or you know, the consensus is around three around four hundred billion, so that would be you know, less than one percent of total you know, revenue addition to Apple. So this is not a needle movement when it comes to sales. I mean, China is a big factor and then we see nothing but disappointment there.
Karen Ana Rag's keeping it real, which if you read some of the notes out this morning, is a bit of a standout in that respect because a lot of people do see growth. I still don't understand this issue of China. You know, we've done a lot of it on the show, but one thing that we haven't discussed is services revenue in Europe and the installed base. You know,
the installed base continues to grow. So even if you look at one market geographically and say weakness in China or one product category, weakness in whatever, overall more people are buying Apple products and they have Apple products, and the services side is doing good.
Yeah.
See one of the things I have to talk about. We all know Apple's a phenomenal company, amazing you know, install based services, all sorts of things that's going. But at the same time, you want to talk about the revenue model. How much can this grow this year, next year. This year it's going to be less than five percent. Next year maybe five percent. So the question is how much do you pay for a stock it's going to grow, you know, four five percent. And you know, I was
listening to your colleague before. When you look at somebody something like an aw sort of Microsoft, you're going to get double digit growth for multiple years to come. So you you take that into account.
And then you you know, match up.
Apple has a lot to explain here that how do they get to that seven eight percent growth here? And I think it's it's going to be a challenging task at least for this year and next year because at.
The moment, the market price is for yet another revenue decline in their fiscal second quarter. So back to what we were seeing all of last year. I mean, any exuberance about this new VRAR reality that we get on sale today on our.
No, not on that, but you know he did utter the magic word Jenny I on the call, and then you're gonna talk about launching some new tubes and Slash products sometime in the second half of this year. I think that's a wild guard that could you know, basically prove me wrong, because if they're able to come up with certain things that are embedded in iOS eighteen that will really make productivity higher, then you don't really need to download an app and do a lot of that stuff.
And for that maybe you need to go to iPhone sixteen or the next version of the iPhone that may have some capabilities and then can drive the refresh cycle of iPhone that we've been.
All waiting for Bloomberg Intelligence senior analysts Andamgrana keeping it real. Thank you very much.
Happy Friday.
Coming up on the program, my exclusive conversation with invidiac Jensen Huang. This was big picture and it was t check it out next. This is Bloomberg Technology. Jensen Wang says that artificial intelligence will matter to every single country and industry on the planet, and crucially that's going to drive up sovereign AI demand for his company's products. I spoke to Nvidia's CEO yesterday. Listen to this.
You have seen India, Japan, and France, Canada, now Southeast Asia, Singapore speak up about the importance of investing in sovereign AI capabilities. It has become abundantly clear to each one of the countries that their natural resource, which is the data of their country, should be should be refined and produce intelligence of their country for their country. And that capability of refining the data of their country, of their country and turn it into their artificial intelligence, it is
now possible in quite a quite a democratized way. Almost every country should be able to do it for themselves. And and what's needed, of course is the technology and the know how of standing up AI infrastructure, and that's where we could be quite helpful to to various regions. And so I think that the the recognition of the importance of sovereign AI capabilities is now quite quite global.
Jensen, does that recognition and your ability to help extend to China.
Well, we're American company and we have to comply with American policies, and whatever the rules and regulations are and the laws are, will number one, comply with them, work closely with the regulators and understand understand their intentions and their desires, work within those boundaries, and be able to create products for for the various countries that are involved.
Fully in compliant with the regulations that are never front of us UH and beyond that, once we once we comply, our goal are in the United States would love to see us be a successful country and in one of the pillars of national security of successful industries, and it creates jobs and allows our country to stay ahead and technologically, and so it is of a great interest of our nation that our American companies are successful around the world.
And so once once we comply with the regulations, we'll do our best to serve the local markets, and we have full the we have excellent communications with with the administration.
How should we think about sovereign AI as a business line for you? Is there a way that we can understand how in videos work. Even if it's building supercomputers like in the UK, for example, what proportion of your overall business that will represent.
That's majority of the computing market has been the United States and to a small to a much longer smaller degree in China. For the very first time, every industry would be every single country will become a computer industry, and every industry will become a technology industry. And so artificial intelligence or the automation uh the production at scale of intelligence matters to every single country. It matters to
every single industry. And so for the very first time, there's a there's a whole new computer market that is going to be uh in in every single country, in every single every single market. And UH it starts with it starts with, of course, uh the native computer industry itself. But you're seeing you're seeing a great adoption in healthcare, great adoption and logistics uh in in transportation of course, uh in many factoring in the large industry, so heavy
industries for the very first time. Because of generative AI, computers are going to be computer technology is going to impact literally every single industry in every single country.
And Nvidia CEO Jensen Van Kara is saying that data is a country's natural resource. But for them, let's be honest, it's a big growth market opportunity.
Absolutely phenomenal interview, just so wide ranging, so global in its nature, kind of well, exactly what you do so well, and we thank you for it. Great deep dive. Meanwhile, we've got some breaking news coming to us in terms of the podcasting area. Once again, we're starting to see that continue to mount. We have Joe Rogan set to
renew his podcast deal with Spotify. We understand so Joe Rogan, of course one of the number one players in terms of the Spotify podcast offering and indeed one of the most expensive for them. Joe Rogan is set to renew his podcast deal with Spotify, and we will bring you the deep dive as to how much that is all going to be costing. Spotify TikTok Well users will no longer hear the music of artists like Taylor Swift, like Drake while using the app, since talks between the social
media platform and Universal Music Group. They failed here with the details blue most Chris Palmery and Chris the date was January the thirty first. It wasn't able to be agreed upon. And the fight seems to be what from UMG's perspective over AI and money and from TikTok's perspective that we'll give you loads of free advertising.
Basically, yeah, I'm smiling because this is Grammy Week in LA parties everywhere gearing up for Sunday's awards. It may have been a total coincidence, but this was the perfect time for Universal to do this. I'm going to get a lot of sympathy from artists. It's going to be the number one topic of conversation everywhere, and very awkward for TikTok. They're a huge part of the marketing of
music these days. You know, billion users, over one hundred billion in revenue, and yet only one percent of Universe Music's revenue. And so this is going to have an impact on TikTok, lesser impact on Universal, but everyone is going to have something to say about this.
Chris, let's get some more in this breaking news sources and telling Bloomberg that Joe Rogan's close to renewing a deal with Spotify.
What are the details, Well, what we hear could be announced you know this morning. It's going to be another multi year extension. Is probably going to be an eye popping number of the last deal was for two hundred million for three years, although we may not get the details immediately they Spotify has been taking a different tack with their podcasts recently. The last deal with Rogan was exclusive,
although they put some highlights up online. This one may be available on other platforms, so that would be a departure, all.
Right, Bloombos Chris Palm Mary with that breaking news and some more details. Spotify up two percent.
Interesting.
Sticking with the music space, what if you could invest in a hit song? Jukebox, which is currently seeking SEC approval, is a platform that aims to provide people with the opportunity to hold interests in music related investments. Here and tell us more ahead of the Grammys is the company CEO Scott Cohen. So for clarity, this is not something you yet have approval for that is pending. But I
guess I start with the demand side. You must know that this is something that either the everyday retail investor or firms actually want to buy into.
Yeah.
I mean you're talking about maybe the first time they've actually truly understood an investment they made. When we're talking about the retail investor, they may invest in a tech sta, but do they really know what's driving that. But when you talk about music, there's something fundamental that people know about music that this is a hit song and I'm gonna listen to it at my ten year high school reunion and my twenty year reunion, and we'll play it
at my wedding. You have a real feel for what songs are valuable and what are not.
You've got the music rights yourself exclusively secured. I think last time we wrote about it, is it about one point seven billion dollars worth. Where are you sourcing that from? There's been so many interesting deals. Beaver selling his catalog to of course Hignosis. We seen Bob Dylan do the same, John Legend. But where do you access the assets from?
What exactly those types of players? You know, as people are acquiring these these catalogs, they're looking for new ways to exploit them. And when I say exploit them, it's bring it to the very people that made these artists big in the first place, and allow the retail investor to get in on these deals because we've all read about it, you know, Bruce, and as you said, Bob Dylan and Justin Bieber, like, these are amazing deals, but nobody offered up any piece of it to the public.
So for the first time, now the public can join in.
So there's a question on value and valuation and appreciation. Like we've done this on this show about sneakers. There are platforms where you can trade sneakers and part of the value relates to their scarcity or rarity. In the context of a song, Isn't it just like whether everyone likes that song or not.
No, No, I would look at it a very different way. I mean, think about it. When music is played, somebody's getting paid. I mean, I don't care.
You can go back however far you want, you know, So what if it doesn't get played, what if it's not get well.
What we're doing is listing songs that already will have an earning's history. It's not songs that have never made it. This isn't speculating on whether a song will be successful. This is looking at once a song is successful, it's always making money.
I mean making much money. Scott given for example, at the moment UMG is at a loggerheads with TikTok because they're not paying enough.
That's, if anything, that supports the thesis that music is really valuable and and and and that is why they're fighting for it. When we look at music, there's a there's a very typical decay curve. Sure a song makes a lot of money when it's first released and it becomes a hit, and then it drops off pretty steadily over the next few years. But then it hits its floor, which is non zero, and then it earns money forever.
And if you look at the Goldman Sacks Report, I think they're pegging it somewhere between six and eight percent annual growth for the music industry over the next decade.
Yeah.
I mean, once a song makes money, it makes a lot at the beginning, drops to a new level and then slowly climbs. But then there's always this kind of wild card. Maybe it gets into a big film or you know TV, Like think about what happened on Stranger Things last season.
Kate Bushy.
Jukebox CEO Scott Cohen diversification of investment. There, we thank you. That does it for this edition of Bloomberg Technology.
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