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This is Bloomberg Tech coming up. Escalating trade tensions between China and the US and now Europe too, will discuss what the latest trade showdown means for the tech sector.
US concerns of an AI bubble grow louder among global fund managers, will discuss the valuation anxiety in their latest Bag of America survey.
And Instagram makes some changes with tighter content restrictions for teenagers. Will discussed with Instagram's global director of Policy.
But first to check in on these public markets, and once again, anxiety returns to the four We are worried about US, China, Europe, China and the trade tit for tat that really moves out into the world of shipping. We're down nine tens percent on the index of the NASA one hundred, but bitcoin crypto in the eye of the storm and one hundred and fifty billion dollars wiped out in terms of market cap. Across the industry. We see margin call's leverage flush out. It really is a dal.
Up of worries when it comes to geopolitical risk.
Here, Okay, let's get to our top story. Treasurary Secretary Scott Besson said he still expects Presidents Trump and Jijingping to meet, though China's latest escalation in that trade conflict between the world's two largest economies raises questions about all issues can be resolved before that meeting. Bloomberg Senior Technology editor Mike Shepherd joins us, Mike, what do we need to know? What's the latest on those US China trade talks.
Well, the latest really is that China is hitting the gas rather than hitting the break now, as the two sides prepared to meet to discuss these ahead of a possible summit between Presidents Donald Trump and shujiin Ping, China. Earlier today unveiled new measures aimed at US shipping, saying a South Korean company with strong US ties and the US operations of that venture Hanua, and then also unveiling
other possible por fees. This is the latest escalation in an area where Beijing feels like it has an advantage over the supply chain. China is has been the world's largest shipbuilder since twenty seventeen, and it follows the last week's move where China imposed new export controls on sales rare earths minerals to the US and to other countries around the world. Again another area where they have a
hold on the supply chain. And even as Sacott Bessant is saying that he sees the prospects for a meeting between Donald Trump and Hijimping, he has also indicated that he sees China's moves against rare earths and he hasn't commented yet on the shipping decision by China, but he sees those steps as aiming at Bazooka at the global supply chain, and it is not the tone you would expect the two sides to be striking as they try to reach some sort of an agreement.
The global supply chain is key, and Mike Europe really considering what its own options are where leverage can be applied to protect its own manufacturers because the rare earth implications are large for them too.
The rare Earth's implications are huge, and they're looking at at a number of fronts. One area of particular concern, of course, has been the vehicle industry and electric vehicles more specifically, and what the EU is considering now is whether to require Chinese firms that want to operate within the block to share technology. And this is sort of
taking a page from Beijing's own playbook. Any foreign company that wanted to do business with the Chinese partner in mainland China had to share technology with that partner as really the price of admission, and the EU is now considering the same, and it is worried because it is seeing byd make such inroads into the European market and putting some of the European makers and their own EV ambitions in jeopardy now would require not only the sharing
of technology, but this also joins CARA other steps that are aimed at trying to rein in China on the continent, and that includes a doubling last week of tariffs on steel imports, clearly a move aimed at China. And this also follows something that we were covering very closely over the past two days, the Dutch decision to seize Nexperia from its Chinese owner, Wingtech, a venture that was subject
to possible US sanctions. We learned today if it did not replace its Chinese CEO, and that prompted the government of the Dutch government to move and to seize control of the local Nexperia from its Chinese parent.
Bloomberg's Mike Sheppard, thank you very much. Let's get more details in the story Mike mentioned. China retaliates after the Dutch government invoked a Cold War era law to take control of chip maker Nextperia, with Beijing now blocking Nexperia and its subcontractors from exporting products from the Asian nation. The company is a s theory of China's wing tech technology and a key supplier of mature chips used by the automotive and consumer electronic industries.
Carat Now, I look these US China trade tensions and European China trade tensions clearly weighing and cross risk assets. Most notably though, crypto It continued to lose ground after our historic round of liquidations that triggered a sharp sell off over the weekend. Remember look, bitcoin is in a technical correction. The market value of all cryptocurrencies felled by more than one hundred and fifty billion over the last
twenty four hour period, according to coin Gecko data. Personal we turned to is Bloomberg's baby Lipshals covers tech assets for US, and this is washing out the leverage from the system.
Yeah, washing out the leverage. You have people getting margin called.
The thing that's interesting with crypto when you talk to your kind of regular joe crypto trader, they sometimes use fifty times leverage, which means that if they're that leverage and you see any type of pullback, they don't get to say, oh, actually, let me try to get some massets together, they immediately get margin called. That's when you see some of this leverage be fleshed out so quickly. And this comes back to the debate twenty four to
seven trading. If you're asleep or taking a weekend off to watch some college football, and all of a sudden Bitcoin pulls back, well, guess what, your portfolio just.
Got blown up.
And that is something that we saw really happen and play out over the weekend. And when you see the back and forth with the US and China, we're going to continue to see this volatility.
Bailey.
One of the best read stories on the Bloomberg terminal and on the website is the latest Bank of America fund manager survey, and in particular the focus on how the market feels about AI valuations and equity markets.
What do we need to know?
You look at it and say that are there fears of a bubble? Looking at that fifty four percent of participants in that October pool pointing to tech stocks being too expensive. You look at the Nasdaq one hundred forward pe nearly twenty eight versus an average over the last decade of twenty three. So all signs do point to overvaluation. When I talk to portfolio managers, the question is where you allocating capital? Is it that mag seven plus Broadcom?
And also if we're going to say that, hey, this is a market could be overvalued, these are investors who get paid to at least outperform their peers. So when you see where stocks have been trading for the last six months, or even if you go back to that April bottom, if you missed out on the immediate snapback, you kind of continue to buy even if you.
Think the stock market is overvalued.
We see investors kind of bending over backwards, doing some mental gymnastics, saying, Okay, well maybe it's overvalued on the forward price to earnings, but if we really look out to twenty twenty eight, well, what does Nvidia look like then then they're justifying buying now. But there's so much talk about fraud, and we've seen it with large cap tech with some of these smaller companies. I often keep
an eye on the Golden Sacks unprofitable basket. That's a returned about forty eight percent year to date, so quickly outstripping the Magnificent seven, quickly outstripping the Nasdaq one hundred. Is that a short squeezer? Is that people taking on risk? It's really been a topic of conversation depending on who you talk to, whether that's in the private.
Or the public markets, topic of conversation on the earnings calls.
So we've just had a CFO City group being asked about froth evaluations in AI. This is focused chutional investors as well as retail investors.
And it's undeniable and the question is are you going to hit on one of those ten investments. I look at a company like Oaklow in the nuclear space, up four hundred and seventy percent this year.
Quantum stocks are up hundreds of percents.
Is that a bet on these being kind of the next wave of companies or is this investor saying you know what if I hit one out of the twelve companies and Quantum ends up being kind of the next paradigm. Well, at least I got in on Invidia, the next in Vidia, if you will.
On the ground floor, which is the biggest story today, the CFO of a bank saying something quite measured, or a Bank of America survey of all the fund managers that they track CFO.
I think when you see management teams start to kind of grapple publicly with the idea of froth and publicly discussing whether they're going outright say are we in an AI bubble or not? Whether you want to ascribe a lot of value to what we've seen and heard from the likes of Sam Altman talking about kind of it is an AI bubble or Jeff Bezos. Every leader at these biggest companies in the world, whether it's tech giants or whether it's the c suite of banks, are grappling with this debate.
And it's going to be.
Something that is a theme in this earning season, whether you want to talk about tariffs, but it's going to inevitably come back to AI bubble valuations and expectations because there is so much debate around the cycling of money and what this actually will mean with building out data centers,
buying these chips, open AI, partnering with seemingly everyone. What that does mean when we look back a year from now, two years from now, was this kind of the buildout of the next generation in terms of AI, or was this something that we all kind of should have seen the signs that there was a potential.
Top Bloomberg's Bailey lip Schultz with big Bailey lip Schultz fans here on Bloomberg Tech try saying that in the morning without a coffee, thank you very much. So coming up AMD and now this is a new agreement with Oracle supplying even more AI chips.
We have the details on that. Next, this is Bloomberg Tech.
AMD says Oracle is set to deploy fifty thousand of their four fifty chips into data center computers starting next year. It's the latest commitment in the AI infrastructure frenzy. Here with the details BLOOMBOGSI and King who leads our coverage of semiconductors. This is an important deal for AMD. It's one of the only stocks on the socks that's in the green right now, What do we need to know about it the specificity of where these chips are going.
So the first thing to note is that these chips don't actually exist. These are new products promised for next year. So what this is is another affirmation that AMD has a role in the future of this massive build out, that it is perhaps more than just an alternative to in video, that people are actually looking at it's technology and saying, hey, we'll have some of that. We like that, We're going to commit at least part of our data center build to that.
And what's interesting is, and it comes hot on the heels of course of open AMD teaming up Oracles down significantly today they've got AI world upon us. But how much are we seeing AMD reap the rewards? How much will some of these be built out in data centers and the margins be impacted for Oracle here?
Yeah, I mean we've obviously saw the massive open AI announcement with am D another affirmation, a separate affirmation from this, that hey, they've got a role. Oracle has been a customer of AMD for a while. This gives Oracle more options. Obviously, everybody else, including Oracle, is paying most of their money to in video right now. The margins are massive, the prices are massive, So this creates an alternative.
Let's go back to what you said about these chips don't yet exist. AMD, much like in Vidia, has future generations of their GPU that they've designed and announced, but they're not yet in production. How do we best understand where AMD stands in this market for this lead edge accelerator versus it in VideA in the next year or so.
Yeah, I mean, I think the best way to look at it is up until the Open AI announcement, it seemed like everybody was kind of AMD curious that they were getting, you know, orders which were substantial and bringing in a good amount of money for the company, but compared to what was on offer, compared to what was happening at in video, really nothing. I mean, they were the best of follow a group that's following in VideA.
What we're seeing now is at least the beginnings of these kind of volume orders and these future commitments, which would imply that they are a serious technology provider.
In king with always the latest, thank you so much, seeking with chips shares a Samsung actually sliding over an Asia training hours despite the company reporting its biggest quarterly profit or expectations of in more than three years. Here to discuss it megs Peter Elstrom, and it's.
Not about memory and demand for it. But why is the stock under pressure?
Well, Samsung stock has really been on a run this year. It's up about seventy five It was up about seventy five percent before these earnings came out, So investors are taking a bit of profit here on the actual news, Samsung's numbers were pretty good.
This is just.
Preliminary earnings for them. They just put out revenue numbers and then operating profit. Just two numbers so far, and their operating profit was the biggest in at least three years. It was about eight point five billion dollars. So they are making more money. They're gaining some traction on the HBM side. These are the memory chips that are paired with the accelerators. But you were talking earlier with Bailey about some of these tech stocks getting ahead of themselves.
Samsung is one of those examples, and it'll run up quite a bit now. The investors are taking a bit of profits, but the numbers look pretty strong. We're going to get final earnings from them later on in the month, we'll get more detail about exactly how much of this is coming from memory chips, the HBM chips in particular, how much from smartphones and other kinds of components. Samsung in this AI memory chip race has been behind sk Heinix,
it's local competitor. Eske Henix has been very good at working with Nvidia in particular, But now Samsung appears to be making some progress. We get more detail on that later, but it does look like they're making some progress.
Pete, you're the editor that leads our coverage of Asian technology, right how do we cover Samsung? That's a company that has all of these different arms and in the calendar, is Samsung the most important Asian technology company right now?
Well, we've got a big week for tech companies in Asia, and particularly chip companies in Asia. TSMC comes later on in the week. TSMC, of course makes chips for everybody, but particularly they're the ones who actually manufacture those chips for Invidio when they go ahead and sell them to Open AI and the rest of their customers. So that's
going to be a biggie. In between, we have ASML in Europe, which is another very important company in the chip ecosystem because they make the highest end chip equipment for manufacturing these high D chips. So both of those are to be important indicators. Samsung is very much in there. Recently, they've had some struggles as they fell behind sk Heinis in the memory chip business. In particular, it looked like
Heiinis was going to run away with this market. Now, Samsung course big company within South Korea, the biggest company historically. They've made a lot of progress in terms of catching up, so they're important, and together Samsung and Skhinnicks give you an indication of how the AI market is doing. So both of those companies are partnering with open Ai too. As you mentioned earlier, open Ai seems to be partnering
with everybody. They both have contracts to be able to supply those memory chips as open Ai embarks on this enormous construction project to build more data centers across the US and beyond the US.
Samsung under pressure and you articulate how far the stock has run up recently, But is there any implication from the dialing up of geopolitical anxieties and the moment we know that China South Korea are getting embroiled from a shipping perspective, Peter, is there anything weighing more broadly or more is that Samsung will be engulfed and yet further tension between South career China and.
More broadly, there are certainly tensions. I think everybody is watching the negotiations between the US and China. We of course had that flare up over the weekend where China threatened to use their control over the rare earth elements in the trade negotiations. President Trump responded by saying, perhaps tariffs would go to one hundred percent. I think that concerns everybody when it comes to South Korea, in particular in Samsung. Samsung is one of the companies that is
building facilities within the US. They're one of the Chips Act beneficiaries, so they're doing construction in the US. They plan on adding a lot of capacity here, so as the Trump administration pushes for more domestic manufacturing, they seem to be one of the beneficiaries at this point.
At least.
They of course make these memory chips, which is really where they make all of their money. The mobile phone business may be a little bit higher profile, but the chips business is really where they make the profit. As they push ahead with that and they work more with TSMC in Nvidia on those memory chips, that should help their profits. But in terms of these trade wars, it's very important that they continue to build out in the US and build up those fabs that they have in the US.
Bloomberg's Peter Elstrom on all Things Samsung, Thank you very much. Now coming up, we're going to speak with Tonal CEO Darren McDonald about the company's retail expassion expansion and it's pushed to infuse AI into all of its products.
That's next. This is Bloomberg Tech.
Tonal Systems, the maker of at home fitness equipment, says it's seen a return to revenue growth fueled by sales of its tech infused Tonal two. The company has experienced a turbulent few years after pandemic era lockdown's lifted and people went back to in person gyms and fitness classes. Let's talk more about the company's tund around efforts with
Tonal CEO Darren McDonald. So there is a strategy now right, a different environment to say twenty through twenty twenty two, and I'm trying to make sense of what links it all.
You seem to want to look at the.
High street a little bit and retail. What is your big strategy.
Well, yeah, just in the past year, we've actually rolled out from nineteen locations to over one hundred locations for a distribution, so we now we have more places people to see and touch and feel a Tonal product, which is incredible because we have seventy five percent NPS and some of the lowest journ in the category. So giving people an opportunity to actually experience this system means that people end up buying, and so just we want to really focus on that.
Tonal systems are still higher end and if we learned anything from a couple of weeks ago when Peloton had its latest change in strategy, people are still very sensitive to pricing.
They want more for less. What's your strategy for pricing?
Yeah, you know, we feel like we've got the world's leading strength training system. It's a personal trainer on your wall. It's a full gym. You don't have to think about it in the sense that we personalize all the weights for you. So there isn't anything out there in the market like what we do. So the fact that we can personalize the workout. We can adjust weights in real time. We'll move weights up by one pound or decrease it by one pound if you're not doing well, and you
don't have to think about it at all. And from our perspective, because of our platform, the way it's built, which sits on top of AI, it's not just entertaining you. It's really a strength training system that works with you, and.
You are offering more to those who already have one with reformer pilates options being built in Darren and unfolded. But I'm interested in the artificial intelligence part of it that has been being baked into everyday workouts on the Tonal.
How are you embracing it?
Yeah, Well, as you said, Carolyn, we're super excited today to announce the fact that we're working with christ McGee and we're announcing our PLATES system. You know what's really great about it is that what we see on our platform is that almost two thirds of our members are interested in pilates, but only seventeen percent of them are actually doing it. And the reason for that is pretty clear. You know, we've got people who have difficulty getting into classes,
they're inaccessible. You have to drive to them. The classes are often difficult to find, and so we rolled that out on our Tonal system. We have force curves that are very similar to what a reformer looks like, so as you move further away from from the machine, it actually increases in resistance as well. It's really unlike anything that's ever been offered out there. So now a greater part of our community is able to actually interact with
something like pilates. And so you add that to strength, you add that to yoga, you add that to the cardio work that we do. And so to answer your question around the AI component of it, we think we have the world's largest strength database. So we have nearly three hundred thousand members lifting nearly three hundred billion pounds.
It's a tremendous data set. So as we learn about you and who you are, we can look at our cables and say, you know, somebody is lifting a certain amount of weight, a certain amount of reps, forced velosophy, range of motion, all of those things which helps us to define what outcomes could look like for somebody. So people get stronger on Tonal than any other system.
It is a premium offering.
Would you ever think about having cheaper offerings or just the application as we've seen with Palatin for example.
Yeah, we don't have anything to announce today, but we're certainly looking at alternative opportunities for our hardware. I mean, we could move upstream, we could move downstream, but again I would just refer back to the fact that nobody has anything quite like what we have.
Just very quick before we let you go. You know you've raised money in the past. Would you raise money just to keep growth going or what would the rationale be?
Sure?
I mean, we're always looking at fuel growth, so you know, in terms of developing new hardware, in terms of acquiring new customers, expanding any new modalities. As we're announcing today, we think there's an opportunity for us to keep.
That going, keep that going. We really appreciate it.
Darren McDonald, CEO of Tonal, on the latest announcement when it comes to reformer plates and the growth story. But coming up and we've got so much more to discuss when it comes to Salesforce. As Dreamforce Conference kicks off today, we're going to speak of may have be a writer.
Sanezuski of eleven Labs.
This is all about the integration of AI and the future of enterprise software. Basically today, the key question is in what are we in an AI bubble? How much therefore are we seeing a return on AI investment in the enterprise.
Look at what the impact though is of China or the US as well.
Funny day in the market, So we're down about a percentage point on the Nazak one hundred. I'm still recovering from Friday where the President broke that news at the top of our show and then markets went into free fall. But the blanket theme is the same anxiety about trade and unknowns about the relationship between the United States and China, particularly in the context of technology. The outlier AMD doing deals over the place. This is Bloomberg Tech. Welcome back
to Bloomberg Tech. I'm looking at the markets and here are some technology stories we haven't got to.
Yeah. The first is Walmart are almost three percent. What do you think it is.
It's a relationship with open AI, an API integration into chat gpt sending the stock high. Just like we saw with the number of names that Open AI dev day. Walmart is the latest to do a deal in the e commerce context to integration in chat GPT also the chip sector, so we talked about AMD AMD's PAED some of its gain relating to the Oracle deal, which Inking explained to us is separate from that open AI arrangement. On the downside, is in video down three point six percent.
It fell in recent days because of the tensions with China. I don't really see a specific piece of news or a catalyst that's driving this down lower. There was, of course the broad coom an open AIA six news of yesterday. They're all names we track because they're moving the markets. Carac Can, let's.
Talk about the moves in the market just of late, in the valuations that they're at ed because global fund managers they are sounding the alarm bells on AI stocks with a record share more than off, saying they're in a bubble. It's all according to the survey by Bank of America. Meanwhile, City Group CFO Mark Mason also out with a warning when questioned by analyst, saying that there is signs of frothiness in AI valuations, a sketch to Bloomberg E Secritaris report around Vastelica.
I mean the noise is becoming deafening.
Absolutely, we have heard almost daily warnings from people about overevaluation in AI stock, some kind of bubble brewing concerns about sort of the circular nature of some of these financing deals, a lack of detail that people want. Yeah, certainly there is a growing, growing concern, although I also would say there continues to be a lot of optimism about the long term path of AI, the long term
productivity enhancements it is expected to deliver. There's still a lot of optimism that these companies will eventually see some pretty amazing returns from all the investments they're making.
So certainly a lot of balls, but also a lot of bears.
Right, there's a lot of headlines around Salesforce on the terminal today, many positive, but the stock's down almost two percent. One I see that you filled with the team is that Salesforce has been cut at Northland.
What's that analyst saying.
I believe he was discussing a lack of real growth acceleration from his agent force AI product. He's not seeing it showing up and CRPO that's current remaining performance obligations. He's not seeing it show up an average revenue per user. Now, Salesforce does have its agent Force event today. I haven't been able to monitor it, so we are hoping to
see some new details maybe about adoption. If they give any kind of insight into how much of revenue growth they're seeing from this overall adoption rates, I mean, that's all going to be very critical for the stock or this is one of those software companies that has really
been struggling this year. Even amid all the AI optimism, there are a lot of software companies that have really been sort of struggling against a perception that maybe AI native companies, notably Open AI, are these companies going to really represent some kind of competition to them that's very difficult to shake. So people looking to this event today really has an opportunity to help counter that narrative.
With most Ryan for Stelica, thank you very much.
Now, as Wall Street debates whether AI stocks are heading into bubble territory, Salesforce is doubling down on the technology. Dreamforce twenty twenty five kicks off today, bringing together celebrities and tech leaders to explore the future of AI in
the world of enterprise. Among the featured speakers Eleven Lab CEO Matti Stanzewski and Writer CEO Mayhbib who will appear together on a panel titled Rewriting the Enterprise Playbook with AI, Please to say they both joined us now here in San Francisco.
May I start with you. You heard what Ryan just said.
I know writer to be an LLM focus company AGENTICAI focus company for the enterprise. Either you beat Salesforce at that or you work with them at that.
Which is it?
Yeah, what we do is help companies rewire operations to be AI native, and so partnerships with companies like Salesforce are really important part of that. So it's definitely the partnership angle. But there is something to be said around doing things AI native and being able to start with a blank sheet of paper versus you know, layering on AGENTIC into a system of record that has existed for a while.
Yeah, you've kind of wanted to build it from the ground up.
May.
But I turn therefore to Matty. And when you're thinking.
About the audio applications of artificial intelligence, we've had you on the show to think about how now music can be created by just writing in a few key prompts. How are companies adopting eleven labs appropriately with a return on that investment.
Is it with a salesforce or is it from the ground up.
Carline. Thanks for having me here. We've seen an incredible shift over last year where the combination of voice and conversational agents can elevate a customer experience for customers that I was Fortune five hundred all the way to to some of them highest scaling startups. We've seen boff. We've seen companies built using some of the best and read technologies including voice, like you said, all relying on the
entirety of the platform. We are thrilled to be here at Dreamforce and as part of the work we do be part of the voice for Agent force empowering that work across their platform. So we've seen both and in across the enterprise segment quick adoption in that sector.
May we have.
Loved how outspoken and clear you've been and pushing back home. Perhaps these narratives of ninety five percent of all AI pilots aren't working when we think about the a MIT report that really rocked the market.
But it's about nuance in this conversation.
May so bring us that nuance of when is it working when they're adopting writer either from the ground up or indeed within salesforce offerings.
Yeah, AI is not another software upgrade. You can't outsource it to the CIO and expect results. You know, a lot of what we do is go to executives and CEOs and say, look, this is about you. Sometimes you kind of want to shake them, like this has got to be a top down, very heavy mandate to rewire processes end to end. If you leave it up to people, a lot of what they're going to be doing is personal productivity stuff with AI versus the high leverage things
that executives certainly want. And as you've seen in terms of what the market wants and this continued investment in AI, what people are expecting from this enterprise.
Investment, Matty, what you and may have in common as your private companies. You're free from the scrutiny that public companies are. But in the last segment we talked about how some of the analysts that cover salesforce are skeptical about.
Agent force. In particular.
You've just said to us, both of you, we actually do see adoption in the enterprise. So what does that tell you if the data for their products specifically isn't as strong.
Look, our focus is predominantly on working across our work at eleven laps, and we've seen use cases across e commerce elevate where you suddenly can and not only have customer supporting and customer experience, where users going into the product, going into the site will be able to interactive agents to help you shop through the product all the way
from the start. It's a good company and Mobilaria one of the biggest in Italy working on use cases like this, and we've seen this scale across across wider degree of
segments and financial services and technology and healthcare. What I think is true and key as you think about salesforce their distribution across clients, of course stretches all types of industries and including regulated industries, so it will take a slightly longer time to bring a little bit of technology into those industries where where additional deployment additional integrations to existing stock are slightly more complex to some of the companies in the space.
May when you're both on stage with each other later today, what's kind of the one key thing you want to get across about what is happening among your enterprise customers at the moment, fighting with each day or what you're most focused on.
Yeah, this is we're hosts of Salesforce, right, they are wonderful partners, and I think a big part of what we want to impart to that audience is how do you make the most out of your data investment with agentic AI, and I think both of us have got companies where enterprises are getting real ROI right from our products and really helping bring that to the data they've got in the salesforce ecosystems is going to be one of the things we talk about.
What's so interesting, really, Mattie, has been the ongoing anxiety among that enterprise workforce about whether they're being augmented or whether indeed they're being replaced. How have you continued to try and tell that story, particularly when you're in the world of music, of IP of real individuality and creativity.
For us, it's extremely important to work with the industry together. So our music is the first fully licensed AI music model at incredible quality working with our research theme, and that's the approach we've taken across voice, across music, across
as we build conversational agents. But like you say, AI is bringing change in the way that we've seen this across enterprise, across the companies we work with, is people using AI will be the people that will unfortunately, where there's people not using AI, so that adoption both and the enterprise setting and across the wider global setting. It's all about being the user, trying it out and bringing.
That to your work and may when you come on.
We've always been very keen to ask you about your growth trajectory, but also the haves and the have nots in the space. How much you still having companies, smaller companies call you up saying, hey, we'd like to team with you, we'd like to offer you, we'd like to have some sort of buy out. Are you seeing that coming from vcs just being more discerning, putting money for the winners, but taking away from those that aren't hitting scale.
The bar for sharp differentiation has never been harder. I think with the hyperscalers just flooding the zone, it has been so such a challenge to make sure the enterprise understands what's real, what's what, and I think that's just getting harder for smaller startups to enter the enterprise as
a result. You know, we were lucky in that we started building LLLMS for the enterprise five years ago, and so a lot of our longstanding relationships, you know, have been a result of why we land new customers in these spaces. And I think that is just getting harder because of the hyperscaler investment. But there's just so many categories. The enterprise needs so much help, and people are not
focused on it the way that startups can. So still a ton of opportunity, but yeah, absolutely getting harder, and.
We love having both of you on to talk about that opportunity.
We're excited to hear from you at SOLS full Streamforce as well. A little bit later Mayhabe as well, Mattie Stetazuski.
We appreciate you.
Of course.
Of Writer and eleven Labs coming up.
Tara Hopkins, Global Director of Policy of Instagram joins us to talk about the company's new PG thirteen content restrictions for team users.
That's next. This is a really big tech.
Instagram will prevent teens from seeing content deemed inappropriate for PG thirteen audiences. Is a new move following Instagram's launch of teen accounts last.
Fall, and that already offers stricter settings.
And comes as its parent company meta and indeed the wider social media industry really battle the narrative that they expose young people to dangerous content.
So let's get the details.
Instagram's global director of Policy, Tyo Hopkins, and pleased to say us here, and I think it's worth in a nutshell explaining what TIN accounts now provide. You've added on new updates today, how are we restricting content so.
Cale and as you said, just to take a step back, we launched tin Accounts in the US and now globally. Last year. Tin Accounts was to address that three things that parents were most concerned about about their young people using Instagram was about unwanted contact, it was about the time they're spending on our app, and it was about inappropriate content and minimizing the amount of inappropriate content a
teen would see on Instagram. What the update is today is specifically about that inappropriate content piece of this, because we're continually learning from parents and what they told us was they were a little bit confused about the different settings and the different controls. They were a little bit confused about when we talk about what is age appropriate or how we age gate and that kind of tech speak that a lot of parents just don't really understand.
So what we've done is we've revammed teen accounts to be guided by PG thirteen movie ratings, really trying to speak the language of parents who are much more familiar with the movie rating movie rating standards. And as of today, it's going to be rolling out to all teenagers under the age of eighteen who are defaulted into this, so they can't opt in or opt out. We're going to be moving them into a teen account experience over the course in the next few months.
And when you're deciding whether content or a content creator is generally PG thirteen or not using artificient telligence for that, how we.
Do we use our official intelligence. So the first thing we did was we reviewed our policies, all the guidelines we had around what is inappropriate content for a team, so what's appropriate for a team? So we did that review on Instagram. And then what we've done is we've built the classifiers, our technology, the AI that we use, and we've retrained it on some of these new roles and rules and tweets and adaptations we've made to the
policies that goes out across the system. And then we find content that we don't believe to be in that PG thirteen movie rating kind of space. We will either hide it from teams or we will.
Remove it entirely.
Tara, there's still questions about from how the technology and from a policy perspective, you define what is or what is not PG thirteen. So could you answer that more specifically on a post by post basis, how is a decision made this is or this is not PG thirteen.
Yeah, So the first thing is we don't rate if you're on Instagram and how this is going to look and feel if you're a teenager on Instagram. Now, first of all, we're going to be sending a notification at the top of your feed for teenagers to let them know what we're doing here, to let them know that we're going to be aligning and guided by PG thirteen ratings. What it will look and feel like if you're a
parent is hopefully that they will understand. Again, we're going to be sending notifications to parents again, really trying to speak the language of parents. What we've done is we've made some changes to the policies so that if you're thinking about a PG thirteen movie that's the kind of experience your team's are going to have. So what a good example of that would be around cursing? So profanity. We've always had rules around profanity on Instagram and there's
certain things you can and can't say. But on a PG thirteen movie, they have very very specific standards around this. You can use one or two quite strong curse words and then other you knows less, more minor cursewords.
So what we did is we looked at this.
We're not apples for apples, of course, you know, we're a social media company as opposed to making movies, but we thought what would be equivalent on Instagram. The equivalent on Instagram is we're not going to be recommending content to teens that has severe what we would describe as severe cursewords. So we train the AI to find those types of cursewords and we will remove them so that we're not going to be recommending that kind of content to teens.
Tara, what other protections are you thinking about doing additionally going forward?
So we're also announcing today two further things. One is that we're going to be giving parents more control if they wish to. So again, these this update is for all teens under the age of eighteen. When we know you're under the age of eighteen, you're going to be moved by default into the PG thirteen or the plus thirteen setting on Instagram. That's the first thing, But if a parent wants to go that step further, we're really
going to help parents to do that. So one of the additional one of the other things they're doing announcing today is that we will have limited even more limited content control. Parents can go in and they can have a look at that, they can talk to their team, have a conversation with them. Particularly if your teenager is in the younger category, you might want to limit the content even further.
Yes, briefly got tens of millions of teen accounts. How many are to opt out navigate those age rules? How are you ensuring that they do remain within those age catchments?
So we now have hundreds of millions of teens in the teen Account experience, which which has been which we launched last year, which is really good news. We've been able to do that technically, which is a pretty big
challenge to be able to do that. We know that ninety seven percent of teens that we've moved into the teen account experience, have not tried to change those more protective settings when they're in the younger age Cash Green, so teens below the age of sixteen cannot change the settings we set in teen accounts without getting a parent's permission.
We're going a step further with these content setting changes, which is it's for every teen under the age of eighteen, but they can't change them unless they get a parent to approve.
It as well.
Tara Hopkins, Global Director for Policy for Instagram, thank you very much for joining us here on Bloomberg ten. Okay, coming up Europe races to prove Jensen one wrong about their AI capability that Bloomberg de diive.
Next is Bloomberg Tech.
Time now before Quing Tech and first up SpaceX. Well, It's pulled off another successful launch and return of its Starship rocket, which deployed test satellite into orbit. The Lamsqu's space company still has to demonstrate and master several novel technologies to meet in its goal of a lunar landing in the next two years. Has Apple Well, It's had a release date for the launch of its super thin iPhone Air in China.
The phone will be available in stores later this month after a.
Pause that allow local carriers to prepare for the device, which is eSIM only.
The news coincided with a visit to the country by Apple CEO Tim Cook, and Google is planning its biggest investment in.
India yet, about fifteen billion dollars to build an AI infrastructure hub in the South over the next five years. India has been one of the biggest winners of the global AI boom, and the project will help accelerate local government efforts to expand the AI industry.
Videos Jensen Wong issued an AI warning to Europe and France over the summer.
You are too slow. Now.
European leaders are working to prove him wrong, with many committing billions to homegrown AI startups and services. Bloomberg's European tech reporter Mark Bergen has been writing about Europe's attens a catching up and joins us now Jensen Wong says, you are too slow at sort of an EU wide level or country by country level. What is it that they're actually doing to prove him wrong or at least catch up.
Yeah, that anecdote from our story was like the lead of it was a dinner hosted by Emanuel mal Cron and in a way before his government collapsed that France was seen as the vanguard here. They had that this earlier this year they announced the largest data center project in the EU. They have Miestrol, which is the closest thing that Europe has to sort of an open AI arrival, and a lot of money in public support from the government.
The European Commission Union has put money behind chips, behind what they call these AI gigafactories, basically large data center projects. If you compare the funding those to the US and China, though obviously Europe is still lagging third place.
When we think about the key players of Europe, they do have some standouts ASML. When you think chip equipment making, you got SAP bringing it to the enterprise. But where else are they trying to grow their own talent and indeed risk pushing back though the US influx of money that seemed to come with Jensen's last visit.
Yeah, I think there's a couple of things happening and we can't try to captures in the debate there are you know, Jensen has been kind of teased Europe for moving too slowly. Clearly he wants them to be buying more in Vidia chips, and there are others that argue that maybe this sovereignty, this idea of independence from the US and China means not relying on in Nvidia, not relying on open Ai, not relying on Microsoft and the
cloud providers. That's a lot more difficult. I think the cloud is where we're starting to see some really interesting neo clouds. Nebulus is a Dutch company here that's fun out from Russia's Yendex that's had a really fascinating growth trajectory. We've seen a lot of these neocloud companies come up in Europe. Some of them are really positioning themselves as alternatives to the US providers, and.
Scale being another key name we keep hearing about Mark Bergen great story, and what you don't want to forget is we're going to dive into all of these topics so much more next week showing Bloomberg Tech summits Tale and being hosted in London is on October the twenty first.
But meanwhile, that does it for this edition.
A Bloomberg Tech and a lot to digest in terms of geopolitics and in terms of valuations.
Yeah, there's still a little bit of anxiety in technology markets. It's largely focused to trade. Salesforce is down two percent on the day that Dreamforce kicks off. How's that going to go down? You can recap that on the podcast. You know where to find it. It's online on all those platforms. It's on the Bloomberg platforms. Big week ahead, This is Bloomberg Tech