From Marhart where Innovation of Money and Power Collie in Silicon Valley, NBN. This is Bloomberg Technology with Caroline Hyde and Ed Ludlow.
I'm Caroline Heindel Bloomberg's world headquarters in New York and I met Ludlow in San Francisco.
This is Bloomberg Technology coming.
Up Microsoft, it unveils its first custom designed AI and cloud chips. Will discuss what the move means for the company and its.
Competitors, and SpaceX planning to spin off its Starlink unit for a public listing as soon as late twenty four. Will bring you the details from our scoop as Elon Musk denies the reporting.
And we'll break down what do you expect from the meeting between President Biden and she in San Francisco, as well as what it means for tech's cities future. But let's have a quick check in on these markets, because we're just calming down after a rampant rally that we've seen in the world of stocks, but still holding onto gains.
On the nawdslack we're up a tenth of a percent tense that's called it, and in notable we're seeing gains over in China, whether or not we're seeing the fuel feed over from the US into China, but also some of the economic data coming in strong when it comes to retail, when it comes to the consumer there and notably around some of the companies have been reporting their earnings.
Of course, we see ten Cent beat, we see JD de Coom beat in terms of their earnings, and therefore we push ahead to what's happening with Ali Baba so
green on the screen in China. We're looking at the ten year yield just managing to rise up quite a lot today though remember after we've seen really yields come crashing down as many anticipate that the Federal Reserve is done with its hiking cycle, an indeed many a central bank around the world move Honestly, what's happening in terms of the world a bitcoin actually, for once, we're getting a bit of a bid. Having yesterday been relatively calm,
We're at thirty six three hundred and eighty three. We're up more than two point two on the day.
Ed.
What have you've got in the.
Micro Yeah, the story that's broken in the last hour is Microsoft unveiling its first kind of custom sill and it's two chips. In fact, Maya is the AI accelerator for both training and inference, and then you have Cobalt, which sees Microsoft moved into kind of the more generic server design chip space. It's interesting who it's impacted that the news didn't really move the needle. For Microsoft, We're
softer three tenths of one percent. I would say that in the last thirty minutes or so, declines on Innvidia have accelerated. We're going to look a bit closer to VideA in just a second. But I would point out that Maya the AI accelerator, it's kind of looking at the specs not the same.
As your H one hundred.
It's more general use on both the training and inference side rather than that kind of high spec H one hundred. But it's interesting to see the market play out the fact that Invidia is down this Wednesday's session. Well, I'm very sorry to say, Caroline, that the record equalling streak
for Nvidia is over as it stands. If we close in the red, Nvidia snaps those ten straight days of gains, which matched its longest streak of winds going back to December twenty sixteen, and eleventh day of gains have been a new record for video. So much momentum though about what they're doing in new chips for China, the H one hundred is still pretty much the only game in town when you're training those foundation models with billions and
billions of parameters. But what does this Microsoft mean news mean? For kind of more general AI, Let's bring in Richie Juluria, Managing director and software exit research analysts at RBC Capital Markets, currently has an outperformed rating on shares of Microsoft a three hundred and ninety dollars price target. Richie, you kind of heard my explanation and my reaction to both.
Myra and Cobolt. What is yours?
Yeah? And then thanks so much for having me really appreciate it.
I'm actually here in New York at our RISI's low tech confer concreates and as he can imagine Generator VII front and center and all our conversations and look, one of the themes that we hear from a lot of companies is it is prohibibly expensive to do generative right, not just the training, but the inferencing, trying to add domain extra keys connecting all these different systems and so what I think Microsoft brings here is they can help
themselves and other companies overcome this big GPU sort this out there. As you said, respects aren't quite the same
exactly as an A one hundred. But I think what's what's interesting is you don't necessarily need only eight hundreds to do all your training, especially if you're thinking about you know, more domain specific models or trying to do some you know, additional tooling on top of TPT for or LAMA too, and so this creates I think, more accessibility for large language models, for you know, software companies, for industry companies to enbridge generate b I without seeing a huge cost drag.
So I'm really excited to see this news.
This is something that we suspected for a long time, but I think it is ultimately going to make ANYI more.
Accessible TSMC, I think making the chips sort of behind from a technology perspective. But I'm interested in rich as to what this does mean for competitors. Amazon has already been doing this, Alphabet's Google has already been doing this with their cloud provisions. Does it who does it impact? It feels like maybe Intel's the one to be watching.
Yeah, Look, I think it impacts everyone, right, I think, you know, we're gonna have to see how this specs between a WUSS chips and GCPS chips and Microsoft chip compare. But Microsoft has already this kind of pole position as being the leader when it comes to enterprise generative AI, and I think there's only bolts that that companies now that they can go to Microsoft and they may not need to go to someone like Oracle that has excess
GPU capacity. They can stick with Microsoft because now Microsoft has the capacity, given they's some of the ability to develop this in house. So this is probably I think positive for Microsoft. Probably it's going to be you know, as you said, there are absolute direct complications for Intel, for AMD, for others within the chip space, But overall, I think.
This is just going to be positive for Microsoft and OI.
It's so interesting to see what some of these names and trading right now. Intel's up two percent in the session. Krror makes such a good point that this battle ground seems like the lower end of the ex elerate A market. I'm looking specifically at Microsoft though, right, Richie, That's why we're here. It's down two tents of what at percent
is kind of like a muted reaction. Does that signal that this just isn't a game changer for Microsoft's cloud business, Like, why is there not a more significant reaction in the stock heare.
Yeah, look, I think people are the jury is still out right. As you correctly pointed out, these specs aren't exactly up to the top of the line GPUs from Nvideo, and you know, given Microsoft's pace of innovation, perhaps investors we were expecting something like that. I think Microsoft will eventually get there. I think they've shown they have the ability to innovate and move very quickly, and that might explain why.
There's maybe a little bit of media reaction.
I'll also say, beyond the chips, some of the product announcements we've seen so far out of Big Night may not be as exciting as people were hoping to see.
I think on in my view.
There's a lot of exciting stuff that we're already seeing. And you know, obviously this keynote is about to kick off. I think we're going to.
See a lot more.
So I wouldn't be surprised as as the conference and the date goes on, Microsoft stock actually moves up, assuming that they continue to make you know, I think announced with that excite people. Gives some stats around M three sixty five adoption. I really like that they've rebranded being Enterprise Chat as Microsoft Copilot. I think that makes it a much more digestible, kind of straightforward value proposition, and I think this just opens up a lot of innovation from Microsoft.
We see as we do anticipate what Satya is going to say on stage, it is interesting that it looks like it's the price that is becoming front and center. Now we have that with open Ayes Developers Day as well. It all seemed to be suddenly a bit of a race to offer more and accessibility and GPTs and chats. As we're seeing more more assistance, but with a cheaper price point, a new lower price for clients. For example of Microsoft three six y five copilot product for the
office software and the sales copilot. Is it going to be a bit of a rush down? Onds do you think in the price point of all of these.
I actually don't think so.
In fact, I would argue, I mean, going to open Ai twenty dollars a month is actually too cheap for what you're getting out of chatting PG four Assuming you're a power user, which I would consider myself to be one of those. For Microsoft Copilot, the name of the game here is not about lowering the price. It's about
adding new features and adding new capabilities. And so now you know, with the announcements today what you used to call being at a price chat now is Microsoft Copilot is part of that thirty dollars per user per month that was in the M through sixty five steed that
got released earlier this month. You also have connectivity of ent through sixty five Copilot too, systems of record like service now on workday and so to me, as long as Microsoft continues to grow what is included in that s few in that thirty dollars per user per month, I think people are going to be able to justify that price pretty easily. And look, look no further than getthub Copilot. Get up Copilt has been a you know, the most mature enter a product for Microsoft.
It's been you know, I think a slam dunk in chef.
You look at the metrics in terms of developing productivity, new code generation, and I wouldn't be surprised if we start to see the same out of M through six SOL code Pilot as it continue to innovate, you know, maybe you know, for an Excel junkie like me, we'll get an Excel copilot that makes my life of building financial models and doing data analysis a lot easier over the next year. So really the name of the game is going to be innovation and adding more features, not lowering price.
Okay, I just want to jump in and point out that the open ai is going to be testing the Azure and Maya one hundred, and the relationship is so interesting because open ai relies on Microsoft not just for cash but compute credits. They also like rely on Nvidia the badge of honor of the h one hundred. It's complicated, but it's going to be interesting to see in the end who's going to win the computing ward just wanted to say, yeah.
A lot of friends or a frenemies, and a lot of deal making. I mean, we heard earlier this week that someone when I'm still banking on Microsoft, perhaps injecting more money as it.
Goes forwards and grows.
Richie, Julia, it's so great. We'll let you get back to the conference go into all the conversations around untender to AI. We thank you for the LBC Capital Markets. China's President Hijingping has touchdown in San Francisco for APEX, where he's expected to sit down with the US President Joe Biden. Today. Joining us now is Blomberg's Amory Holden, and it was three pm local time that we saw these pictures of him exiting his plane. Of course, Treasury
Secretary Ellen there to help greet as well as Gavin Newsom. Amri. There is a whole lot widing on this, and a whole lot of protection as well going on. Yeah, there's a lot of protection.
I can tell you that it took a while actually to get to where I'm standing right now. A ton of security in San Francisco, and Ed can attest to that as well. But this is a high stakes meeting and it's actually happening outside of San Francisco proper, at an estate a little bit more relaxed feel, has sixteen acres of gardens. It kind of is reminiscent of when Xi Jinping came during the Obama administration and they met in Palm Springs and really lived physically. They were rolling
off their sleeves to get to work. So for the Biden administration, we heard from President Biden before he departed the White House to San Francisco yesterday, talking about the fact that he just wants to get relationships to a normal correspondence, to be able to pick up the phone during times of conflict, to make sure that their militaries go back to normal communication, a normal dialogue, a normal cadence of that dialogue that we saw really just ripped
apart following former Speaker Nancy Pelosi's visit to Taiwan last summer. And for Shijingpeng, he's obviously dealing domestically with an economy that hasn't bounced back as some were hoping following the pandemic, a property market that is dismal at the moment, and a very high youth unemployment rate this summer is at twenty percent now was the last time we saw the data.
So for Shijingping, this is a moment of potentially trying.
To open up some more goodwill on the economic front, not just with President Biden, but also this evening when he meets with chief executive officers, right.
I mean, we've heard from sources that you know, the who's who of tech execs are trying to get into that dinner. The aim is to thaw relationships, particularly on the economic side, right, amh. But the battleground here is that the US has these technology export curves on China in the context of AI and chips. Is that going to be a factor here, Well, this.
Is something that Shijingping would love to get rid of. But we already heard from the Treasury Secretary Janet Yellen, and we heard from President Biden himself, and Biden Yesterudary was saying how it is in the US interest if an average Chinese citizen is able to go out and have a working wage and make a decent living. But Biden was very clear he will not move economically if
it impedes US national security interest. So those export controls, those penalties, those types of sanctions, they're not going anywhere anytime soon.
All right, Bloomberg's Amory Horden will be on the ground at APEC all week. We will continue to bring you that reporting. Thank you so much. Let's get more and bring in doctor Oriana Skyla Mastro, a Center Fellow at the Freeman's Folly Institute for International Studies at Stanford University, DODR. Mastro also for of Upstart. How China became a great power.
Welcome to the program, Dr Mastro. You heard a Marie set out the discussion points between Biden and g For you, what is the most significant point of discussion between those two leaders.
Well, I think both sides are saying the fact that they're even meeting to discuss anything is the biggest takeaway. We are facing a bunch of issues right now, security, economic, that as the two most powerful countries in the world, the United States and China, need to be able to collaborate and talk about.
These issues together.
And if we don't have routine and sustain and predictable visits between the two leaders, this becomes increasingly difficult and it's hard to sustain anything that they might even agree to add this visit. And so really what I'll be looking for is not only the types of topics that they're going to discuss and what's on the agenda for whether or not they actually have any sort of frank exchange.
I'm interested to dig into really the perfect points around your book that's forthcoming, the idea that through they've built up China in particular, it's built up this power, whether it be militarily, whether it be economically, whether it be entrepreneurially in many ways, but you sort of outline how,
and it's through strategic emulation, through exploitation, through entrepreneurship. And I'm interested in from the tech perspective whether all this tip for tat that we continue to see, particularly when it's limitations to access to chips, for example, just is going to be the normal? Would that be your policy recommendation.
Well, I think the prediction would be that China is going to be somewhat entrepreneurial and its approach to this tech competition. In many cases, when I talk to investors, they often express some frustration with the economic decisions that China makes at home. But as I lay out in the book, party control is one of the main factors that decides for China which strategy they're going to pursue.
And a lot of times they can't emulate what the.
United States is doing because it doesn't it's not conducive for their domestic political system at home, so they have to go another route. Sometimes that route is relatively ineffective, like we see with soft power and perhaps the speed at which the Renman b is becoming a reserve.
Currency without loosening capital controls that's going to be difficult for China, but.
I have no doubt that as they face these new challenges, they're going to try to think of new ways to exploit their own competitive advantages gaps in the international system, for example, and standards and other areas that are important for technology to still try to get ahead.
Dodr Mashtro Corporate America, according to our reporting, is doing everything it can to get into that room and have dinner with President G. You heard us outline earlier in the program about the technology export curves in place. Do you think that g can have any kind of leverage he can use the interest of technology CEOs in meeting him to go to Biden and say, look, everyone wants to do business here.
I am highly doubtful that that would work, honestly speaking, not only from the US restricted but also from the Chinese perspective. With Chijenping, power is more important than prosperity. There's many decisions that we have seen him make that if economic prosperity with a number one priority, he would have done something completely different. I think the COVID zero policy is a perfect example of that, and the same for the United States national security now Trump's all things.
The Chinese military has been modernizing at a pace and a speed and at a level that it now presents a threat to the United States, and so we can no longer turn a blind eye to certain technologies that can be dual use.
And so perhaps those.
Leaders will get into the room and have a very pleasant meeting with Chigenping. But I don't think he's going to change his approach to technology control at home. That is important for his own control over the country, and it's not going to convince the United States to put itself.
At risk for the sake of economic prosperity.
We have seen such a change in supply chains. It's been focused through COVID, whether or not it's been the geopolitics at play. Ultimately the corporates that you speak to about this, is that just going to be the narrative going forward? We are going to see more of a bifurcation or not.
Well, I really hope it doesn't get to that level of a complete bifurcation in two different blocks. I was in China two weeks ago having a dialogue with the Chinese, and they have the often.
Retort that the United States is trying to contain them.
You know, US policy and limited export controls is no way a containment of China, and I hope we don't move in that direction because our economies are quite interdependent. But I think what we're seeing is a lot of leaders understand that de risking is important, whether it's supply chains for the United States so we can continue to.
Fight wars if we have to, or for leaders that might have manufacturing hubs within China.
It is important to have a plan B because this is not the Cold War. The United States and China have some conflicting interests, and it's possible.
That the two sides find themselves at blows.
Doctor Rianna Skylo Mastro fascinating me. Thank you so much of Stanford University, and of course much more. Meanwhile, coming up, let's talk a little bit about the private markets. SpaceX considering spinning off its Starlink unit to a public company as soon as twenty twenty four. Well, guess who's behind that, reporting One Ed Ludlow. We'll speak about it in a minute. This is Bloomberg Technology.
Okay, Bloomberg reporting this morning SpaceX is discussing an IPO for its Starlink satellite business. As soon as the end of next year twenty twenty four, on robust demand. Elon Musk responded almost immediately after we published that story in response to a user on x, the platform formerly known as Twitter, saying false.
That's all.
He said, without elaborating. Let's bring in bloombo Ryan Gord, who is one of the reporters that report this story with me. Right, let's go over the mechanics of what we know.
Yeah, that's right, Ed. Obviously, great to share a byline with you. It's the technology. But last night we reported that this morning, even though we reported that SpaceX has started discussing a potential of public offering for Starlink as soon as the end of next year, it has started to move the satellites satellite Company's assets into a wholly owned subsidiary that would eventually be spun off in an IPO.
Obviously, you just mentioned that.
The Mask himself said this morning that you know this reporting was false. But you know, we just say that, of course, no final decisions have been made, and that SpaceX could opt to attain the unit. But you know, this is something that I think Musk has, as we know, spoken about over some times sort of hinted at this at various occasions.
He has said that, you.
Know, in twenty twenty one, as far back as twenty twenty one, that starlink with list shares once it could make predictions reasonably well about cash flow. Of course, on the and he said that starlink had reached cash flow break even. So for all of the posturing and the gesturing, I think, you know, it's interesting that you know, we put out the support yesterday this morning, I keep saying, and you know, yeah, we'll see.
I mean, the reporting takes a little bit of time. Ryan, I'm interested in, ed, is what an about turn this actually sort of is. I mean, it's not that long ago since we used to discuss well, concerns around just trying not to get bankrupt basically in starlink. But what fueled its sudden.
Growth, Well, it's consistent with what we reported, right, must saying that it has reached cash flow break even, but that reporting last week. Starlink could bring in ten billion dollars a revenue next year. That would make it the vast majority of SpaceX revs overall. And it's working. You know, if you look at a map of where Starlink's deployed
around the world. It is widespread. It offers connectivity satellite based internet for people around the world that have not been able to get access to fast feed internet before. The demand is there, and we know that the rollout has been careful and slow because there's a regulatory component, but there is demand for this and it's the centerpiece of SpaceX's future, right the cash cow.
The musters will take us to Mars.
And just think how slow competitors have been there, like Amazon Stalls cautiously going through it with Project Kuiper, but not coming anytime soon. In terms of the pace that we've really seen from SpaceX. We want to thank you for all of your bylines. There are another couple Gillian and Esteban on.
It as well.
Great reporting, Ryan Geld, We thank you, Anadin of course.
And Ludlow, Welcome back to Bloomberg Technology.
I'm Ed Ludlow in San Francisco.
I'm parent I had in New York. Let's get to you a quick check on these markets. Halfway through this training day, we are managing to sustain some sort of gains in the Nasdaq and the Nasdaq one hundred. We're currently up about a tenth percent. Now, remember we were up more than two percent on this benchmark yesterday, so just cooling after the rampant growth. We've got a little bit of a Goldilock scenario going on with the data once again today. Retail sales are calling a little bit,
but still looking resilient into the holiday period. And that PPI number those producer price is actually showing some pullback. That inflationary anxiety dialing down will market it sells off, but the Golden dragon over of course, then thea's that golden dragon really showing some fuel and buying of Chinese related companies that are traded here in the United States. We're up three and a half percent after we have beat some ten cent JD dot Com in particular, we
all look at Ali Baba also. Of course, there's still hope that we might see some stimulus going into the Chinese economy. Big day for US and China. Of course, from a geopolitical perspective, Bitcoin currently up two point three percent. Go into the individual movers though on the day, and we do want to highlight some of the individual idiosyncratic news coming from well, the likes of JD dot Com with its numbers doing well We're up more than seven percent.
All eyes on Alibaba for after the bell. I'm looking at Amazon down by one point eight percent, and this is related to what's happening with Microsoft. Potentially Microsoft now going in with its own chips making sure that its supply chain is under control when it comes to AI related chips, those in data centers. Amazon has already been doing that. Who is alphabet as of course Google and many of the cloud providers. Amazon just down by one
point seven percent. Maybe that's also about the retail data that just showed a little bit of calling so appetite for some retail related names in China not so much here in the United States. But then while we're going to be going into where some of these companies heil from, we're all talking about Silicon Valley day in, day out. From a geopolitical perspective, we talk about San Francisco on the day as well.
So there's a spotlight on this city this week because of APEX. But I want to bring you another story that was in Bloomberg BusinessWeek this morning. Michael Moritz, the prominent venture investor who became known basically for making early investments in Google LinkedIn PayPal, Yahoo. That was during the years where he was a partner at SCA Capital. Moritz is now focusing on investing his time and money in remaking San Francisco, a city that he thinks has lost
its way. Moritz has lived there here for four decades and is dedicated get this, carry more than three hundred million dollars since twenty twenty to both social and political causes in this city, basically funding hundreds of nonprofits in different advacy advocacy groups.
The spotlights here in SF.
It is the spotlight is also on ultimately the remaking of the city. Particularly as we keep talking about generative of ai is, Suddenly it becomes more of a hub cerebral value as we talk about it, the scale of appetite for a rental space. We're going to have so
much of this conversation throughout the show. Let's keep talking about San Francisco's future and revival right now when Natalie is sendover, executive director of the Urban Land Institute San Francisco, a network of cross disciplinary real estate land news experts which is working towards this exact goal, this rejuvenation. Maybe it's a pr effort, maybe it's a reality effort that people haven't been coming back to San Francisco proper in terms of the office space. What was it, thirty percent
of office space just unleashed as it stands. Is that changing at all?
Natalie, Yeah, thank you for inviting me. I think you know, you and I recently brought together a group of national experts from around the country to talk about just that downtown revitalization and you know, what can be the future for San Francisco. And what was interesting is we had all of these folks come in from around the country expecting this horrid environment and really they were surprised. They were like, it's not that bad. And you know, with
every crisis comes opportunity. And I really do think coming out of the recommendations from this panel, there really is a lot of opportunity for downtown San Francisco, particularly thinking about how we can diversify the mix of uses to really make it a great neighborhood.
Natalie, good morning. You're over in Oakland. I'm here in San Francisco. I just want to go back on what you just said. So earlier this year, ULI convened this group of people and you basically showed them San Francisco, and they were pleasantly surprised. I understand on the health and state of this city. I sawed this week by speaking to the mayor and said, look, everyone is asking how you were suddenly able to clear up the city in a week because the president is in town and
the president of China is in town. To be very clear, your findings well before APEC were that San Francisco is making improvement.
Yes, absolutely, And I think that the narrative around San Francisco and the doom loop is really a narrative that isn't quite accurate. I think the city has actually been hard at work at making changes.
For a while now.
Particularly, you know, our work has been focused on the financial district of downtown San Francisco, and that's where our panelists spent their time, and there was really a general consensus that it felt pretty clean and safe.
You know, there was some activity on the street.
It obviously wasn't exactly like it was in the pre pandemic days. You know, there's still some work to be done on the kind of gateways and the connectors to the financial district of downtown San Francisco. But I do think that the city has been hard at work making some changes well in advance of Apec coming to town. Apec coming to town, just like any city when they're going to have a glow spotlight on them, are going to go through some you know, more extreme measures.
To clean up the city. And I think that's only a good thing for San Francisco.
Everyone loves a bit of chadenfreude. Everyone loves to sit in one city and bad mouth another. And I am interested though. It was but a few months ago that I was in San Francisco walking across that very street that we just saw in the imbook Idea, and I'm afraid there were still so many signs of such sadness. People still very much living on the street, a lot
of what people call tense city. How is there a long term, ultimate fix to that, and how do we start to see some of the areas of focus really feel rejuvenated, not only on Market Street, but more broadly when it comes to art, to culture and and really what makes the city thrive.
Yeah, absolutely, I think that when we're talking about downtown, the financial district in particular, you know, it's really been a single use district. It's been commercial office and catering to people from the nine to five. So I think the first step there and this is what our analysts found as we really need to think about diversifying this area, which you know, bringing in residential is you know, one piece of that puzzle. But conversion isn't a silver bullet.
All of these buildings can't be turned to housing. But you know it will help not only with our housing crisis, but to diversify the area in downtown. But you can't just fill a bunch of these office spaces with the housing units.
Call of a day, Well, NATSI I just reflect.
Look, I am a resident of San Francisco and I work in San Francisco, and you know a lot of the doom loop discussion that is not universally the experience that everyone lives here. Right, there's a lot that's good about the city. But you just made a point and diversify and the navy that you hood you're talking about Uber salesforce X, the company formerly known as Twitter, it is still largely tech or it's vacant.
Is AI changing that?
You know, I'm not an expert on what's going to happen with AI. I know there's a lot of hope for AI there is still You know, San Francisco has been the text center of the world for a number of years.
I don't think that's going to change.
I think that AI will likely be interested in coming to San Francisco, but I also think other things and other types of businesses need to come to San Francisco, and the city is working on figuring out how to incentivize those other types of businesses to be interested as well.
And it's not only these big companies.
We're also talking about San Francisco locally made businesses to support the arts and culture, as you said earlier, and bring them to downtown.
All right, Natalie Sandobal, executive director of the Urban Land Institute San Francisco, Thank you so much.
Let's stick with this city.
Another fixture of San Francisco's landscape is all has been robotaxis, and until recently it was the only city in the world that had two robotaxis operate in twenty four to seven and charging a fair to the public. But some issues led to cruises permit being removed, and now hundreds of emails between Cruz and the city's police department give us a window into the relation ship between those two groups,
ranging from contentious to the collaborative. I want to bring in Junior Love who, Julia Love, who did such a deep dive on these documents and emails?
What have you found out?
Well, this was really a fascinating glimpse into the relationship between CRUSE and the San Francisco Police Department at a really pivotal time for the service, and SFPD raised some concerns. There were multiple times when the vehicles disrupted crime scenes, barrelings, or caution tape. There were also and there was also an incident in which First Lady Jill Biden was visiting the city and the vehicles got confused by the motorcade
and disrupted its path. So some new windows into the bumps on the road that we have been seeing for some time now with CRUSE. There were also some signs though that the police does have an interest in the data that CRUZ obtains. They wrote to CRUZ multiple times expressing an interest in obtaining its footage after the vehicles were spotted near crime scenes, and CRUZ did appear to be upholding its practice of making the officers get warrants.
But I think it just understores that this is a multifaceted relationship it is.
And one that well the police also have with alphabets weimo and I'm sure there are plenty of back and forth and sometimes celebration le relationships and other other times more difficult intense relationships. Ultimately, does this shine a light on any way in which we'll see Cruz back in San Francisco, They remain in Phoenix or amazing in Austin. Is it going to come back to the city, Well, I think it.
The emails show just how hard Cruse worked to maintain a good relationship with SFPD despite these troubles that arose, and experts tell me that that relationship really will be the key to Cruz returning to San Francisco. SFPD won't be the one that ultimately restores its PERI meant to operate in the state, But police really do help shape locals of view of a company, and so if Cruz can earn the trust of SFPD, then that is a step toward earning the trust of everyday San Franciscans.
And of course, Ed you were just with the mayor London Reed talking about how they have to work to regain trust, so notable that that is certainly an effort they are on with the city Julia Love, thank you so much for that reporting. Meanwhile, coming up, but we're going to take a look at an aviation company archer from self driving cars. Now we're looking at getting in the air and how the CFO is doing finances through the pre revenue phase. It's coming from blumas Leita's chief
financial officer. Episode coming up tonight, gust who's in it as well. This is Bluemotechnology time now for talking tech. First up, open Ai has had to press pause on accepting new users for its paid chatchpt plus service due to overwhelming demand. A scording to the CEO, Sam Altman, who's put in on a post on Tuesday to marsw open aied tools and services rose after the company, of course introduced new features and upgrades as first ever Developer Day that was last week and from APEC to the
Singapore Fintech Festival. In just well an hour after delivering a speech in California, the Philippine President Ferdinand Macross Junior, appeared halfway across the globe in Singapore using a hologram that takes me back. He was the first of all's only speaker to tap into that technology. Plus Byte Dance is considering selling Shanghai Moonton technology. It's the gaming studio
behind popular game like mobile Legends. Bang Bang So also say Bike Dancer Quad Moonton in twenty twenty one on a valuation of about four billion dollars, but is now looking to streamline its operation focus more on the core businesses and of course e commerce. Meanwhile, ed, well, you've got something on the future technology too.
Yeah, I've kind of been up in the air sort of. Archer, the Eve Toll Company is getting ready to bring its aircraft to market in twenty twenty five. That's when the FAA has said it will begin to allow limited operation of those vehicles as air taxis. In the latest episode of Bloomberg's Chief Future Officer, I took a look at their air taxi called Midnight and a chat with Archer's CFO Mark Mesler, chief Commercial Officer Nikhil Goel, and CEO and founder Adam Goldsein.
Have a listen to this all right, this is it. This is inside Midnight Welcome.
The design is four passenger seats front road, back row and one pilot.
How after all.
This time did you arrive that configuration four passengers one pilot.
Our goal is to be the Uber Vier.
But when I was at Uber, we took all the data of Uber trips going back and forth all over the world, and what we figured out was that four passengers was the optimal configuration to do one thing, which is lower the cost per passenger for these trips.
So we understand what the cost of the aircraft is, we understand what the cost of the pilot is, we understand what the cost of the repair and maintenance of this is, we understand battery costs. All of that feeds into our unit level economic model and it does show that pricing ad ride sharing prices allows us to make an economic profit on the.
Back at Archer headquarters, I actually got to fly midnight. Okay, not for real virtually in the company's E simulator. Training pilots is another hurdle the EV tool industry will have to clear how much burden are you going to take in the training process?
You know, why does that fall to Archer? And if it does, what does it look like for you?
Guys think we are going to be training our own pilots. This is our own technology. I think eventually as we look to scale and we're always talking about unlocking scale. We could look to partners to help us do some of the training early on. Pilot training will be a critical part of our own operations.
The simulators really help you get a sense for how easy the vehicles are to fly. In fact, what we found is people with less flying experience are actually better at flying these planes because you don't have to unlearn as much.
Does that include me?
That includes you?
So within five minutes you were able to take off, fly around the island of Manhattan and land successfully. And that's your first time you've ever been a simulator and that's pretty incredible.
And I landed it safely. You can catch the full episode A Chief Future Opposite tonight at nine point thirty pm East in time, a lot of.
Fun investment managers are releasing, of course, they're so called thirteen F filings for the third quarter as the quad by the SEC, and the findings give us kind of a taste of view into what these managers have been buying or they've been selling. Tuning us now as Hemapalma bunting Berg News and Porter covering hedge funds, who's really given us a beautiful roundup of Ultimately where the bets were placed. Its backward looking, but some notable standouts.
Yes, So I would say one of the standouts is Meta. We've seen kind of across the board buying. If we look at the Tiger cubs, which are typically the hedge funds that are focusing on the tech stocks and quite keen on the rotation in that space. So if we look at loan Pine Capital, they started a brand new position in Meta and it's actually now their largest long
holding the firm. They bought about two point seven million shares at about eight hundred million dollar valuation at the end of the last quarter, so they took a pretty chunky, sizable steak. If we look at some of the other funds, Tiger Global, Viking, CO two, they all increase their steak in Meta. It's now Tiger Global's biggest holding, and it's CO two's second biggest holding.
It's it's the most wonderful time of the year thirteen out filings for so many But on the other side of the table you just mentioned them, Tiger Global.
That's kind of a name that we jump on. What do we learn.
Yeah, so Tiger Global, they increase their steak in see the Internet consumer company. They bought a ten more of that stock, up to about eleven million shares of it, and it's a company that's really struggled. Their stock price has struggled over the past quarter, so it looks like the company may have the firm may have bought the dip on that believing in the projections of how that company may look, but taking advantage of the share price.
Another interesting thing with Tiger Global is you'll remember that they've been a long term investor in JDA dot Com.
They got into JDA.
Dot com well before it went public, and they've cut their steak in the shares of JDA dot com by about half, even more than half, and that bills on them cutting even the quarter before last, So we do see a bit of a trend there reducing that stake even though buying more c.
Interesting as you see, it's not performed well all yet to day, but JD dot Com popping after its earnings, so maybe they want to be longer a little bit at the moment at least, or real being shorter on the day. What about those people generally sold out of was jdcolm the theme for example? What were the other names?
So we saw some rotations If we look at Viking, they sold about thirteen stocks entirely Netflix and Ali Baba, but then also bought fifteen others. With Viking, they bought Workday, Amazon, and United Parcel. Those are now their top three biggest holdings. So you do see a lot of rotations across the portfolio. Sometimes you see aggregated buying and like a meta, we haven't seen a whole lot of other selling in JDA
dot com. But each fund sort of has their own specific way that they look at the way that they approach tech.
Wow, all right, bloom Oh, I'm sorry, Carry I'll jump in. But you know, thirty and f's you get a sense of what do people like or not like on a long term basis. And these are the guys deploying big sums of capital. Thank you so much for the Bloomberg's Heema Palmer has come back to San Francisco. The commercial
real estate market is having a moment. While it's struggled more than any other US major city to recover from the pandemic, AI's startups have been breathing new life into the city's market.
Let's go to Bloombergs preor and who's been writing about this this morning.
What does the data tell us, Like, we know that AI is a thing, new companies being founded, but from a square footage perspective, something real is happening here.
AI companies have added more than a million square feet of office space this year, and real estate agents telling me are telling me that every day they're touring when different companies looking at more and more office space. Clearly, in this industry, in the sub industry, within tech, people feel a need to be in person at least several days a week, if not most of the days of the week.
And some of the names, like was it anthropic taking over Saxony Company h Q, it would feel like we've got other key AI names just building out secondary headquarters in SS even if it's not their first. But what about turning space to be fit for them? We were hearing what Ed was having a conversation with the mayor of San Francisco about making more space for AI labs.
That's right, And what's interesting is actually a lot of these AI companies are not clustering downtown necessarily, or they're not necessarily attached to being specifically downtown. So open AI is in the Mission District and a lot of companies have sprouted up kind of near their office in the Mission. There's a part of town that's getting termed Area AI.
It's sort of the eastern part of the Mission, a little bit of Soma and Petrero Hill, and that part of town is actually seeing a number of offices crop up and a number of companies sort of clustering there. Maybe it's the Open AI effect, right, wanting to be close to the center of gravity in this industry.
And it's a great story. People should go read it. We thank you so much. Meanwhile, look that does it. From this edition of Bluebog Technology.
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