I'm inde Caroline Had.
We're at Bloomberg's world headquarters in New York at Ludlow. He's live in company in California. Because it is Apple's WWDC. This is Bloomberg Technology coming up. Full coverage of that very event. As Apple prepares to debut is long await to mix reality headset, and as the company nears, of course a three trillion dollar market cap. Much more ahead, Plus we'll get perspective on virtual and augmented reality gaming in today's Venture Capital Spotlights. That's with Abba Atherton of
Patron and Twitter. The US AD sales plunging, we understand. We'll discuss the woes facing the incoming CEO, Linda Yakarina.
It's her first day on the job. This is the company forecast.
Small declines ahead, all that and so much more. First, let's check in on these markets, because while is still technology managing to power through some of the warriores, when it comes to the macro front, we've got the services data showing actually some weakness there.
Maybe that's actually pulling back some of the yields that we see on the two year yield.
Maybe people thinking the FED really can't hike into this sort of environment quite to the anticipation that previously done, but notable outperformance of technology on top. We'll dig into some of the micromovers, but NASDAC up almost half a percentage point.
Not so though for bitcoin crypto.
On the downside, this risk asset not liking some of the moon music around finance, of course, because it's exchange worldwide for crypto. They see the SEC ayer there, the SEC sewing both miinance and indeed its founder cz were of by four and a half percent, so accelerating some of that sell off on the back of that news. Let's move on to some of the key micromovers though, because look we.
Have got some buoyancy, certainly in Tesla stock.
We've just been looking all about things SpaceX, but Elon's other play at one point seven percent. Some of the Chinese data, the car sales looking at growth month on month and significant.
Growth year on year.
After we see that Shanghai gigafactory managing to come out post COVID. Meta actually on the upside, getting some rates from Oppenheimer, for example, saying big bet for AI. They see Meta outperforming and though the chicks so the chip stocks are lagging today we're seeing the socks currently off by one point two percent, so the Philadelphia se we conductor Inex on the downside.
Basically, last time I checked.
Every single chip name apart from AMD was on the downside. As we just see city group going negative on that particular outlook.
But let's look at what.
Really we are powering in terms of the outperformance in n tech today.
It's going to be Apple. Look at its.
Current market cap two point nine trillion, closing in on that three trillion row once we saw it just hit, but it never closed up that number back in twenty twenty two, and we see it just reprise up forty percent on the year to date for this particular stock. And of course we want to go out to Apple's at Worldwide Developers Conference or WWDC as it's known, kicking off running through June ninth, and look, tech giants, long awaited mixed reality headset is what we're all focused on.
And ed you're on the ground, give us the latest. What's it feel like, what's their sense like? What's the goodie bag like?
It feels like the biggest event for Apple in a decade? Right, Mark Goerman has set out what we expect through his Boomberg News reporting and Mixed reality headset. Three thousand dollars, price points sixteen gigabyte RAM memory, carbon fiber, aluminum glass. The question for this mixed VRAR headset is what is the slate of content?
What are the apps that are ready to go?
Because the price point's interesting, not even high enough for Apple to make high margin, but low enough to not price them out of the market. Cara, I find this dynamic so interesting. Go back to twenty fourteen when they unveiled the Apple Watch in September that year. This feels like the biggest move into a new category since that point, a historic moment for Apple.
Yeah, let's look at all things Apple.
Let's look at all things with your guest as well ed, because I mean, you're just saying, really, this is a price point that's going to be high. This is sales that actually isn't about margin, isn't about scale, but it's about reinventing what we think of.
As virtual reality as AR as well. And you've got the perfect guest.
Yeah, you asked me what it's like on the ground, Well, what it's like is seeing those familiar faces, the veterans of these Apple events, and one of them is Karell in a Millionaisy principal analysts that creative strategies. You heard my pream yeah about the mixed reality headset. What is this moment in Apple's history for you?
I totally agree with you.
That is the big moment for Tink Cook is the big announcement of a new era, a new market building vote of everything that he has done for of a company since he took over the leadership.
Right.
So, I think we are going to look at opportunity in enterprise as well as opportunity more opportunity in content. Those are, in my opinion, the two area where the var mixed reality heads it's going to play.
The specifications three thousand dollars reported by Bloomberg News, sixteen gigabyte rand memory.
You look at the materials that.
Used to make it, but it really seems like the big question is what you can actually use it to do?
Yeah, And I think that's exactly the right question to ask right now. To be honest with you, it doesn't really matter in term of you're looking at early adopters that will buy to figure out what you're going to do with it, even if it's three thousand dollars. You're looking at developers are looking at the opportunity to expand their iOS and mac os and iPad os market, and then you're going to look at time before the mass
market is going to be ready for it. So there's a I think there's opportunity to create the ecosystem in the same way as app or you talked about Watch, but I think a good comparison is also the iPad, where at the beginning you were using iOS apps and then developers came with dedicated up. I wonder if we're going to see a similar thing here.
I spent the morning going through the data from twenty twenty two for augmented reality and VR headsets three hundred thousand globally and augmented less than eight million for VR. How much of the catalyst will Apple's move be for what is a young product segments?
Everybody's going to come, right, it's the classic building and they will come. Apple has done that time and time again, right coming into a market that hasn't quite taken off, or it was but then installed, and so they're able to re energize that. I think from a developer perspective, there's no question that these offer a huge opportunity and others who will come to the market and see what.
Is available Carolina.
Meanwhile, the rest of the market is just completely focused on artificial intelligence, it feels like, and there's a mixed viewpoint here from analysts that we're getting some like web Bush, I think we're going to hear a lot about AI from Apple today others, while our own Mark Gumman saying this is not the time or place and actually wait for it in a year or so.
What do you make of Apple's AI play?
I think that Apple has been talking about AI for a long time, but in a different way. You know, first it was Siri, and then the talk around Siri went away and became it became more about on device machine learning, which is still part of AI.
Is what's still you need for AI?
Apple is in a different place compared to say a Google or a Microsoft because they don't own their own cloud and so they are dependent on others to run big models. So they need to bring us back to what is the value of artificial intelligence on my device and link to that is the value of artificial intelligence to me as a user? And there's I would argue, no one else that knows their users as much as Apple does.
To that end, anything that you're excited about from what else will be unveiled today. We know that they'll probably be having an update to on the financial offerings, and it feels as though it's not a particularly pleasant place to be right now if you're a fintech and seeing just how much more Apple can own that space. What are you thinking about in terms of the health area? What excites you?
Yeah?
Yeah, Obviously this is the developer conference, so I am really interested in seeing what other enhancements all of the platform from watch to iPad, to iOS and map will bring. But we also know that there's likely to be some new macs, and I think when I think about that in particular, is the opportunity that Apple is continuing to have in an enterprise environment. You know, Apple never talks
about the enterprise business. It's always a consumer company. But the reality is that they're gaining enormous share in enterprise and if they are bringing to the market and MacBook are fifteen inch at an aggressive price point, then the share will grow strategically for them.
The developers love WWDC. It is for them, Watch os, ten iOS, seventeen software.
What are you most excited about that?
I'm you know, I don't expect big things. I continue to expect personalized care if you like, the ability of really pushing especially the phone and watched to be more of the health and security device we saw last year. Some features those are the kind of things that I'm expecting. And then it'd be interesting to see what we see around messaging and FaceTime. Whether you know this this little fight with Android and r CS will end this time around or not.
Well, were you at Google Io? I was not well.
Reason I bring that up is at Google I they reference this fight in a sort of hint, hint, way, go back to the headset. I'm sorry we have to mixal But those developers in the audience, what is it that they'll want to hear? Because ultimately we've reported the Bloomberg that actually of Core Suite apps on iPhone and iPad will be available on the mixed reality headset, but they will develop its next generation functionality.
Yeah. I think for the developers, all about the tools, right, is how easy is app or going to make it for them to take those up that are already available just you know, regularly ported onto the to make them better and to make other opportunity for them to monetize. You know, how much richer is that there's experience is going to be for their apps that allow them to monetize more from the app.
Bloomberg is reporting that Apple hopes to sell nine hundred thousand units of the Mixed Reality headset in year one. What's your reaction to that low high?
You know, it's hard to tell before seeing the headset and see what the value is. I think a lot of it will depend on how many different things can you do with it and from it, not just the app perspective, but from a content perspective. We've seen Apple really doubling down on sports.
I do think that is interesting, isn't it where this makes the most sense? Ed's great reporting. Much has been said about sort of the Quest three that's just been coming on the mark. We understand it's going to be had a well five hundred bucks versus the three thousand price point that we're getting from Apple. But really where the penetration needs to be felt is in the office productivity, not just sort.
Of gaming and health. Is this going to be.
A productivity kind of a use case? Immediately or is this ultimately just showing off that is an aspirational good and you've got it.
I do think that there's an angle that is productivity related. We obviously see Microsoft to play with Olo lens but then walk away from it. So there's definitely an opportunity there, and that's why I was talking about the mark earlier that Apple is now creating that space for them in business to be taken seriously.
I was looking at the history of WWDC.
It wasn't called that then, but nineteen eighty three at a hotel and San Mateo was the first kind of developers conference. What does this event mean to you when you sit there in the audience, it's pre recorded, You listen to it, share with us your experiences and what you get from it.
I always remember my first one, which was after the iPhone in two thousand and seven, and it was a Moscone and I came out asking if the coffee was spiked in the morning, because the buzz that you feel is honestly something that I always compare only two Nokia events I date myself yet rip back in. You know, when Nokia was the leader in smartphone business, there's nothing else quite like it.
Absolutely fascinating when it comes to all things ed Nokia one old school viewpoint to be bringing.
But as you said, Rip and thanks so much.
Carna melanis as well, President Principal Analyst Ever Creative Strategies. Apple touching that record high today, nearing a three trillion dollar market capitalization. It's all ahead of the WWDC event that's kicking off in but an hour or so's time. Tech AI stocks, of course have been your main driver for the markets this year.
Well, they continue to be.
Nancy does with us CEO and financial advisor at Opus Advice First, a private wealth advisory practice of Amerorprise Financial Services. Always great having you with us, Nanci, and we sort of continue to run on fumes here or the fumes reality for you when it comes to AI or indeed big tech being a safe harbor but also a growth play as well.
Yeah, well, you know, I'm always very excited about the technology sector. Even when it was tanking last year, I kept saying, how what a great opportunity it is, especially if you're in it for the longer term, of course, because the day to day swings can be a little daunting. But of course, you know, technology is the way of the world, and there's more of it coming, especially with AI, where we're going to have another transformation of our lives
in the entire world. So it is very exciting. Indeed, just have to have a little bit more information. There's a lot of unknowns at this time.
There are, and it means therefore for some like cities saying this has gone too far, we're likely to now see a downward trajectory perhaps. And as these AI ultificion intelligence headlines become steeped within business models, do you think we've run up too far for what ultimately gets painted as the clear picture of what AI does to these companies?
Well, you know, when it comes to buying stocks, the math has to rule, and clearly the valuations. I'm sorry, the earnings are just not living up to the valuations at this time, and unfortunately that's what counts when you're buying stocks. And so, yes, there's a little bit too much excitement going on here, and that will account for a great deal of ups and downs and significant volatility.
I mean, when you have eye popping returns of over one hundred percent year to date and then you look at last year and down fifty percent, those are pretty big swings, and an investor would have to have pretty strong stomach lining to be able to put up with that.
I mean, I'm just looking at the forward looking the price to forward earnings on Apple currently trading it in excess of thirty times.
This is a company that's going to.
Post actually a decline in revenue for this fiscal year. Is though, a company that has just got that shaer market waiting.
Can you fight against what have been.
Sort of well, many are turning them sort of the super seven or the Magnificent seven key stocks that are just driven the upperformance.
Across the S and p AN and DY the course the NASDAI this year.
Well, we're still in the business of meeting clients' long term goals, so we tend to take a little more prudent approach and maybe buy companies there engage in AI and all of the ex but not necessarily depends solely on that revenue. They have to be more diversified and have earnings and revenue from.
Other sources as well.
I think that's probably the most prudent way to enter this arena. But for the most part, we're going to be a bit more weight and see because we still quite frankly, don't know the good, the bad and the ugly of what AI has to give to us or bring to us in the next few years.
I'm therefore the good, the bad, the ugly when it comes to macro picture as well. Today we see services weakening overall. We're worried about whether the Federals of Pike's interest rates further actually is forced to start cutting them. How does that guide you as to whether technology is a sector as a place you want.
To be.
Well.
I do believe that the Fed will pause, just as mister Powell indicated, and I don't believe there will be any rate cuts at least not anytime soon and certainly not this year. The technology is a sector that is here to stay. I mean, this is clearly something that we live with and is involved in every aspect.
Of our lives.
So it's not going anywhere, and in fact it's going to evolve even more and faster. So it certainly is the longer term outlook. But again, longer term is the emphasis, because the day to day swings can be extremely volatile and it's not for the faint at heart. You do have to have it in a longer term perspective across usset.
Are you thinking long or getting into technology stocks that of course are diversified, or is it more about the bomb market different parts of their overall capital structure. Where do you think is the right place to be allocating at this moment?
Well, for the longer term, certainly technology stocks are, the entire tech sector will be terrific. However, shorter term we are taking a much more defensive approach and going on the fixed income side or thee the structured note side. I think that that can create a little bit of an offset for all of that up and down, the daily up and down, and the crazes and then the downfalls.
And to that point, this is a global narrative.
We've seen AI sort of take wind, whether it's in Asian names or whether it's being traded here in the United States, even some European ship stocks getting caught up in it. But do you allocate primarily to the United States, Nancy? Do you think about diversification globally.
At this time? We have stuck mostly with US.
We have not ventured into outside of the US too much as of yet. I don't believe the valuations there are going to be as profitable as US. There's many, many more problems outside the US than what we have here. And also the currency exchange plays a very big part of it still unfortunately, and when the dollar is still this strong, it's very hard to bring alpha into the portfolio of investors.
How many of your private wealth clients are still interested in crypto?
Well, all of them are? They all are.
They all ask questions about it, But I'm fascinated by how little they actually.
Know about it.
It's fascinating, and I think every new craze or every new headline jujuor really indicates how little people actually know about what everybody's jumping into. And then that's pretty fearful, in my opinion, we have to be very fearful when that happens.
Nancying great test in time with the Nazi David of America Price.
We thank you me.
While coming up, look, we're going to be discussing steps of Microsoft is currently taking to get through at sixty nine billion dollar takeover of Activision Blizzard as in Talking Tech.
But we just talked about it with Nancy. Let's get back to it. Crypto. What don't we know? What do we know?
What we do understand that the US sec is filing charges against finance. That's certainly leading perhaps some of the negative feeling and sentiment around the OG today. We're currently off by five and almost quarter of percent, let's call it for bitcoin. At the moment, Wall Street's main regulator accusing Binance An Indy its chief executive officer, that's cz
of breaking US securities rules. It's a major escalation in those legal woes that continue to face what is the global biggest crypto exchange.
This is a bloomberg time now for Talking tech.
First Up India's by Jews is looking to IPOs tutoring unit next year as the education technology company is seeking to shore up much needed cash. The initial public offering of the unit it's said to take place in the middle of next year. By Jus said Monday in a statement. Meanwhile, in the most valuable startup that's what it is, it's planning to make a quarterly interest payment of about forty million dollars on a loan that has really been at
the center of the firm's financial troubles. Meanwhile, to look abroad and look at Beijing's ban and Micron, it continues to attract calls for retaliation from Washington. GOP lawmakers have asked Commerce Secretary Junia Romando to counter China's ban by sanctioning a Chinese semiconductor company.
Chang Shin Memory.
The lawmakers are also urging Romando to work with Tokyo and Seol to ensure that they don't take advantage of the market share left by.
China's Micron blockade.
Plus, let's look at an up update in Microsoft's sixty nine billion dollar takeover Activision Blizzard.
Microsoft's president Brad Smith, he's actually going to.
Be meeting with UK Chancellor Jeremy Hunt that's next week, to really voice its frustration over the decision by Britain's competition regulator to block that takeover. Smith is expected to point to the benefits of the acquisition, for example, for gamers, a pushback against the move that blot the industry's largest merger, and a decision that will kind of soon play out in the special UK Antitrust Court.
Welcome back to their technology. I'm karenin Hide in New York. We want to get a.
Quick check on these markets on the important day of WWDC. Then as that trades high because Apple pushes on higher up sevent tens of percent then as like one hundred. The big tech juggernaut is what I focus in on.
Even as we see perhaps some muted.
Trading in the rest of the day and the rest of the benchmarks, we're worried more about some of the macro picture coming in terms of services on the decline. We saw New York CREWD actually up one and a half percent, interesting moves coming from OPEC plus actually a cut to production from Saudi Arabia. Up goes oil, but pulling off of those highs as well. Bitcoin under pressure after we see the SEC take steps against cz the founder of b Finance and indeed against finance itself or
off by five percent. Just the moon music changing on that particular risk asset and it's moving on.
And look at some of the individual.
Movers though, So those forever to chemicals that were so affecting three M, we understand there's going to be a postponement to that particular trial. Maybe some sort of deal can be struck, a global deal on how to basically settle on what is These forever chemicals are concerned that it's indeed affecting supplies down two point six percent from three M but power Auto networks managing to power ahead on the day. Why because they're getting included in the
S and P five hundred. So we're up almost five percent. We understanding on the change in those benchmarks. But as we say, today is a notable day because it is WWDC all about developers, all about Apple, all about well, the changing of the guard is to a new kind of product. We're up almost two percent on Apple. We're near two point nine trillion dollars basically in terms of market capitalization, record high in the share price ed can
we hold onto it? And you're in covera Tino and it feels as though the energy is there, The excitement must be brewing.
Yeah, it depends if we get what we're expecting, a three thousand dollars mixed reality headset mix because outward facing cameras give us the augmented reality functionality through video feed through next generation screen giving us the virtual reality component. A mix of carbon, fiber, aluminum and glass, sixteen gigabytes of memory. Mark German and of Bloomberg News is reporting it's going to be able to carry the core suite of apps that you and I know from I on
iPhone and iPad. What's really interesting, though, the question is on the killer app, what is going to be that big thing that justifies a three thousand dollars price point of functionality? Interesting the work that Mark's reported around fitness and tech. You and I big health tech users. Can you imagine working out caro using a mixed reality headset?
And that's the point is the stumbling blocks that basically these headsets have had is that they kind of make you feel a bit sick.
They're just too heavy.
It's why in many ways this has been delayed and a different vision from what Tim Cook first had for the product, which was going to be far like to wait, far easier to wear throughout the day.
Well, what's really interesting is that we think that this mixed reality headset will be akin to something like ski goggles, right, but it means there's no space for glasses. Where is like myself, Oh, I got my spare contact lenses in my bag just in case. But you know, I think the other big question is let's remember what Apple WWDC
is right, Worldwide Developers Conference, big emphasis on software. A big part of that audience will be building the next generation of functionality for mixed reality headsets this one, but also the more Ford of all future generations. Going to get some interesting updates on OS as well, not just on mac and iOS, but watchOS ten is something we think is coming. According to Mark German's reporting, Yeah.
Still a lot to be talked about, particularly the Max as well. We think are going to be a lot of time dedicated there. We're pleased to have Ed joining us right now.
We are so global.
I'm here in New York, you're there, well covered in California, and right now very long is with us.
He's joining the conversation.
Who sat there in Taipei late at night joining us principal analyst and founeral Constellation Research. You could a turn of thirty dollars price target, I believe on Apple. You feel is vr AR. Is this an area that Apple's just going to dominate and make it well the product and the ecosystem We've all been waiting.
For, you know, we've actually waited almost twelve to thirteen years for this. It started with the first acquisition of Mattio by Apple, which was one of the leaders in augmented reality and virtual reality. And so when you read into the code New World's theme, they've been cryptic about the future worlds in a mixed reality world, and this is probably the start of what we're going to see that move from two D to three D, they move
from typing to gestures and eye tracking. It can actually change where we go, but we're still at the very beginning. But it's a big market cap that we're looking at here. We're looking at about four hundred and fifty one billion by twenty thirty with a kager thirty seven point two percent that are about to head there. But the real thing is how do we take device plus content plus distribution networks to get there? And that's where Apple will have the magic sauce.
Ray Bloomberg's reporting that Apple intends to sell nine hundred thousand units of the mixed reality headset in year one. What does that tell you about their confidence for uptake and demand at that price point.
I think that's a price point that's not for the mass market, but a price point that's designed for the experts, the developers, and the content creators that are dying to get their hands on something to make this metaverse world work and make that move from X reality augmented reality to where they can get to a point where we can actually see apps for both the B to B mart and the B two C market, And I think
that's what they're counting on. But that number itself, nine hundred thousand is still a pretty big number, which means that they've gotten their manufacturing capacity to be able to do that. So I'm going to be curious to see how they put this all together.
Yeah, I mean, you're sat there in Taipei at the moment.
Is this a supply chain question that has to depend on China at the moment.
Actually, there's a supply chain question that's going to happen on multiple forces for where you actually get the glass, the lead, all the stuff here Taipei, Taiwan, as you know as one of the leaders in providing supplies to Apple from a various number of companies from fox Con down Line to the L two L three suppliers and having conversations with them over the past few weeks and over the weekend, it sounds like the supply chains are getting ready to ramp up for a very very different
type of approach.
Yeah, I really think that we're focusing in on supply chain, We're focusing in on actually.
Ed as well.
When this becomes available, we're going to be talking about it, hearing a price point.
Right, When will it go on sale?
Yeah?
You and I had that Twitter space is Friday with Mark German, right, And that was such a big question for so much of the audience. What Bloomberg's reported is that A, this is a product that's been delayed several times, Apple would hope to unveil it much sooner. Could we see this in December, for example? And what the roadmap is for shipping. I find Ray's answer on nine hundred thousand being good evidence that they've got their supply chain
together really interesting. My question to you, Ray is how quickly do they need to move on to a lower price point model in order to give this segment some momentum.
Yeah, that's a great question, and I believe that's going to be something in the next twelve to eighteen months. Right. You've got to get the content in place, you've got to get the developers and managing what's next, and they've got to get another iteration to what their new operating system is for whatever this headset will be called. And so whatever that OS is going to be is really how we're going to figure out where we get to in terms of the right type of content, the right mix,
the right type of use cases. I believe they've got a sense of what those use cases and scenarios are on the enterprise side as well as on the consumer side, and that's what makes us exciting, and of course that's what makes WWDC exciting.
Ray I reported earlier this year that the real reason Meta cut prices on questpro was because the enterprise demand just wasn't there. There was no appetite to bring a higher end headset into the workspace. Do you think Apple can crack that problem?
We definitely think so, and I think the use cases around field service have been important. I think the use cases around training, the use cases around B to B interviews, the use cases that are happening around helping people on board,
those all real use cases. But at the price point that Metal was putting it at, and the lack of content and the lack of developer interest, I think that was the challenge and I think that's where Apple may crack this, especially when they talk about coding new worlds. I think your listener to see the updates. When we look at air Kid seven and Reality Kit two, they're going to show some of those updates that actually will
help you understand how they're evolving. And of course, if you think of this is the unifying force of bringing all of Apple's os is together, this could be the first step where we see iOS, iPad os, tvOS, watchOS maybe come together. And I think that would be the interesting development to see the software platforms all unify against this new medium.
Kind of a power of the ecosystem. Ultimately, Ray and I'm interested in your take of what is an elephant in the room, because every other company is talking about it every earning call and.
Statement had it artificial intelligence.
Do you think Apple's going to go their talking much because ultimately it's sort of already thought that the market understood its power in that area, in that arena.
Well, living in Coupertino, California, I can tell you that they are definitely wrapping up on AIML team members. They've been definitely wrapping up on AI engines engineers. But this has been going on for the last five years. So for Apple, AI isn't like oh, cool, shiny new object, you know, It's more like AI is embedded in almost everything we do. And by the way, here are the
applications that makes your life better. And I think that's the difference between Apple talks about AI versus this little weird battle between Microsoft and Google trying to outdo each other on the AI.
Wars, little weird battle that we love to talk about. Ray Wang, great to have some time with you.
Thanks for staying up late, principal analyst and founder at Constellation Research. And really just keep on banging that drum over there in Kubertina, California. He's going to be much more coming up from him at any moment. Meanwhile, coming up, We've got some interesting conversations we having with amba Atherton, ed partner at Patra about the fund's broader thesis for the future.
Of gaming as a blooming.
Time now for our VC spotlight from education to shopping games. Apparently they're going to shape the next Internet. It's the early stage venture capital firm Patron Believe as it invest in what it calls a broader gaming thesis. Joining us now from San Francisco is a Matherton partner at Patron, also out with a book titled The Rise of Virtual Communities. On a day where we look across to Covitino, we look across to Apple and the making of maybe VRAR
to the masses. How much does virtual reality augmented reality bring to bear your future analysis and thesis on gaming?
Well, I think it's great that Apple is getting into the game. You know, they had the best when it comes to computing hardware. So for gaming, this could be a Palm pilot to iPhone moment. You know, for gaming, the iPhone was a critical catalyst for that industry. So I think it's going to be really exciting to see what developers do with this new device and you know what venture outcomes and opportunities could be there.
Ultimately, you think about the gamification of everything, So how much is the RAR going to end up being the way in which we work? How much does that become gamified? How much does our finances become game of filed? I mean already you're thinking about the gamification of many of these sorts of areas.
Yeah, I mean, so a patron reinvest in what we call the spectrum of play. So on one end, you know, that's actual game studios, and then on the other end that's game like experiences. For example, Kudos, which is a smart wallet which is gamifying the shopping experience or Tonic, which is helping musicians practice in a more game like
way with a virtual studio with avatars. So I think if Apple can solve the form function problems and honestly just the comfort of having a device on for that long, there are going to be a lot of opportunities for this generation to be continuing to live and play in virtual worlds. I mean, you can't forget that half of us kids play roadblocks every single day. So I think for a new generation of consumers, it doesn't feel like gaming. This is just where they hang out with their friends.
And it's interesting that when we were previously thinking about Web three avatars, when we were thinking about gamification, many would put meta there. Ultimately, how much does VR and AR or Web three depend on VRAR becoming reality or not?
Really? From your perspective, I don't think the two are intertwined.
I think that, you know, particularly what I learned in my book is that while technology evolves, some of the fundamental challenges still remain the same. So I think what we're looking at is founders who are building with whether that is blockchain, whether it is AR.
VR, whether it's AI.
You know, we want sustainable businesses and founders who are going to think about the challenges alongside the opportunities.
Okay, how many of those founders are currently seeing opportunities in artificial intelligence?
In your world? How are you able to sort the week from the chatter?
I mean, I think it is impossible to ignore. If you are a founder today, you have to embrace the fact that this is a huge landscape shift and presents a huge amount of opportunity. I think that in game play specifically, you know AI for NPCs world creation, there's
so much that can accelerate the founded journey there. So we're excited about the portfolio companies that are experimenting across the board with how this will help them accelerate their roadmap and also allow players to have a more sort of interactive, personalized experience.
And when you're looking to write checks and you're in seed in very early sort of stage, sort of one person with an idea helping them build that around that, I understand. Is it competitive out there at the moment? Are lots of checks still being written? What sort of valuations are you looking at?
Yeah, I mean, look, I think this is a great time to build. You know, when economic times are tough, some of the best companies get built.
So we're seeing a lot.
Of very very interesting talent coming out of companies across Silicon Valley who are looking to.
Ride this AI AI wave. But also just realize that where.
We said as patron is in between you know, gaming consumer culture, and it's so difficult to ignore that gaming has such a fundamental impact on culture broadly. So I think we're seeing a lot of exciting talent come out of you know, bigger companies across the board who are looking to take advantage of this opportunity and the environment right now.
What's interesting, of course about your journey is you were a founder YC Combinator and then came out and was what your companies I feelt was bought by Discord. How you how are you thinking about the landscape of ultimately companies either being bought at an early stage, or whether we can see companies that we're currently hoping, like a Discord to eventually go public, even though.
You have to wait that a little bit longer.
Yeah, I mean, I think, you know, everyone's waiting for the IPO market to pick back up, and that could be towards the end of this year. But I think you know, M and A activity is still very very vibrant right now. But I think that you know, the challenges with virtual world and online communities remain the same. You know, you're thinking about moderation, You're thinking about, you know, the tremendous scale that you need to truly monetize with
ads moderation. So I think there's still despite technology evolving in this sort of mixed reality world, there are still fundamental challenges ahead.
Monetization key for so many Patron and Atherton, thank you very much indeed for joining us today. Look, we've been talking about it all show what's going viral right here?
Right now it's Apple's WWDC.
Tim Cook moments away from starting his keynote where we expect the launch of the company's mixed reality headset, joining us now the one the only very busy Mark Gumman and Mark how much detail will we actually get when we can put these things on our faces or when we might even splash up to three thousand.
Dollars Here today is going to focus on the headset, the hardware itself, the software demos, what it's going to be able to do. This headset is probably four to seven months away from going on sale. They have not started mass production yet. They're only starting very early test production. It's still in its stage called V which is a development cycle. It's not at that final hardware yet. It's still a prototype, so probably won't gone sale until December
January at the earliest. In terms of the price, it's possible they'll announce the price Today's possible. They won't announce the price today, but we believe it's going to come in a three thousand dollars range, give or take a few hundred dollars on either end.
But the important thing.
Today is drumming up interest, getting developers on board, showing the world what they've got here so they can move forward and get this thing to market at the end of the year early next year.
We were just talking about monetization and how difficult that still is in kind of online communities and social But ultimately, what's this about monetization for Apple and launching such an expensive vaar.
Is it about the rest of the ecosystem. It's about the.
Rest of the ecosystem. There's gonna be plenty of content to buy for this device. There's the app store. Obviously, they take their App store share the app Store is going to be a very big part of the launch itself as well, So clearly this is a hardware and services play.
Long term, I think.
They're going to make some pretty good money on this thing, and it is going to be probably a you know, maybe a flop at the beginning. It's going to start very slow, but over time it's going to turn into one of the company's most crucial products and potentially even a bridge to a future after the iPhone.
Marm German, you're going to be busy all day. We thank you for spending some time with us as always. Meanwhile, well let's also go viral. In another matter, let's look at Twitter. A New York Times report showing that ad sales as the platform slumped fifty nine percent from April to May compared to this time last year.
For more, let's bringing in Bloomberg's Asia counts.
And really, I thought we heard from en or Must that all advertisers are coming back.
Doesn't look like it.
Yeah, that's what he said, But I mean, advertisers continue to be really hesitant because a lot of the challenges with the platform have not really gotten better. There's still a rise and hate speech, there's misinformation. There is the whole verification blue checkmark debacle. Elon Musk himself has made a lot of problematic tweets, and so advertisers are just really concerned about brand safety, what is my ad going
to appear next to? And so it's not super surprising, but it's continuing to be a struggle for Twitter.
Probably not a delightful report for Linda Yakarino to read on her first day at the job.
Ryan not delightful at all, But I imagine she kind of had some expectations going into this, like she's probably aware, right Musk as vocal we said advertising revenue was zound fifty percent. He said that at the end of March, So the struggles have been out there and they've been known. So I imagined she knew what she was coming into and just plans to use her relationships and her deep industry experience that maybe help bridge the gap.
Ultimately, we're not expecting things to change overnight. Are we expecting them hiring at least to be occurring some sort of shoring up because they've seen some key exits, particularly around trust and safety, which it seems to me is exactly what well brands and advertisers are missing right now.
Yeah, you would expect Linda to bring in some people. I know he's bringing a person that used to work with her in comms from NBCUSA. I imagine that she'll be involved in hiring additional people. Musk has talked about probably needing to rehire and maybe even some of the people that will let go in some of the initial
rounds of cuts. So I absolutely think that they will have to do that and just sort of befoop their team in order to be able to handle some of the expectations that advertisers have around brand safety and as you mentioned, trust and safety and what kind of content appears on the platform.
Bloommeg's Asha counts with a breakdown on all things Twitter.
We thank you so much. Well.
Meanwhile, that does it for this edition of Blueleg Technology. You've got so much more to be digesting there. Of course, WWDC is about to unfold.
What are you going to hear in.
Terms of virtual reality, aug mented reality, what's the price point, what's the application, what's the hearing.
In terms of health overall?
In terms of also your finances, We've got plenty to be hearing as well in terms of operating system upgrades and remember the MAX are going to be front and center for many in terms of a sophisticated suite of PCs, whether you're working or playing, we think about the future of technology when it comes to Apple any moment now from Kupertino, you've got to let Ed Ludlow run into that event and be hearing what Tim Cook is going to be saying is he takes to the stage alongside
many executives. Meanwhile, of course, you can go to one of Apple's products, which is Apple Podcasts, and listen to the Bloomberg Technology Podcast. If you haven't managed to listen to us live, there's also Spotify and iHeart from New York from San Francisco.
Stay with us throughout the day for updates. This is Bloomberg