tv Bloomberg Technology Bloomberg November 17, 2016 12:00am-1:01am EST
to purchase anis unlimited amount of bonds at a fixed rate to rein in the surge in yields since august. 10 year yields turned positive this week for the first times since that shift in policy. the pboc has weakened the yuan for 10 straight days to 6.689 to the u.s. dollar. ae currency is trading around year lows. analysts at bloomberg sea in weakening to seven by next year.
a key member of donald trump's team says the incoming administration is considering setting up an infrastructure bank to fix roads and bridges in the u.s. hillary clinton had promoted the idea during her campaign and was derided by republicans, saying it would be funded by a massive tax increase. global news 24 hours a day, powered by more than 2600 analysts and journalists in more than 120 countries. this is bloomberg. trading just underway in the afternoon session. we are firmly in the red. exuberant gains over the past few days. shanghai up by 3/10 of 1%. also weighingess on tokyo stocks. ♪ emily: i'm emily chang and this
is "bloomberg technology." coming up, cisco shares sliding after the company forecasts a text in a slowdown on the horizon. the full earnings report ahead. plus, twitter suspends the accounts of prominent white supremacists as it attempts to curb abuse and harassment. and a short seller says tesla shareholders should quote, have their heads examined if they approve the pending deal. his full comments ahead. first, to our lead. fallout from the election of donald trump continues to ripple through the tech world, especially when it comes to social media companies. twitter says it suspended the accounts of prominent white supremacists, among them, richard spencer, often credited for spearheading the so-called alt right movement that supported president-elect trump. twitter also added tools this week to help users better filter out of use. in a statement, the company says, because twitter happens in public and in real time, we've had challenges keeping up with
and curbing abusive conduct. we took a step back to reset and take a new approach by focusing on the most critical needs. meantime, facebook continues to come under fire for allowing fake news to spread during the election. mark zuckerberg has dismissed those claims. joining me, the cofounder of aztec centers, and sarah frier, who cover social media companies tech." omberg let's start with the banning of white supremacist accounts from twitter. how connected is this to the election of donald trump? sarah: twitter in the run-up to the election has understood that there has been a dramatic increase in hateful conduct on their sites. the anti-defamation league s run studies. there has been an increase in white supremacist, anti-semitic, those commentaries, as a result of the excitement over the election. not necessarily endorsed by
trump, but they have found a way to rally around the election. and so the company was already working on tools to curb harassment in light of that, and i think that the news they released earlier this week about some of the more stringent rules that are going to be in place, the better reporting tools people will have, and now they are showing they can actually take action. this is something they have come under fire for in the past, and in light of the election, they really need to take a serious look at it. there is a fake news on twitter too, but on twitter people are much more concerned about the amount of harassment and abuse. emily: both facebook and twitter have been criticized for amplifying the voices that people wanted to hear. let's take a listen to what mark zuckerberg had to say about fake news and
whether or not it influenced the election. >> personally, i think the idea
that fake news on facebook -- it's a very small amount of the content -- influenced the election in any way is a pretty crazy idea. emily: jennifer,
what do you think? how much responsibility does twitter bear here? >> the election has highlighted and amplified how impactful social media is. i think all of these private organizations -- they aren't subject to first amendment coverage, common carrier rules. but how they think about their impact requires them to reflect on what that looks like. even if it's a small percentage of that today, how that will change over time and what tools they can use on a nonarbitrary basis to manage fake news or
harassment or aggression through their sites is something they need to be taking a look at and i suspect they are. emily: facebook and twitter are completely different sizes. facebook is enormous. david kirkpatrick wrote the book on facebook and suggested earlier this week that jack dorsey is taking a more political stance, where we are seeing mark zuckerberg be much more apolitical. >> zuckerberg, it's important to him personally to appear unbiased. we saw how facebook reacted to the dispute earlier this year around trending topics, when gizmodo reported that there may be liberal biases in the stories they selected to be trending. facebook almost over reacted to that. they fired the human editors, they invited conservatives to headquarters to speak with zuckerberg and learn more about how newsfeed works. this is a very tricky place for zuckerberg to be in. he does not want to be the
arbiter of truth. he doesn't even want to block biased opinion-mongering news, opinion masquerading as news. those will be the most difficult articles for facebook to try to restrict. fake news could be easy. those kind of things that are trying to persuade people are going to be a lot harder. emily: do you think facebook needs to take greater responsibility to add more human editors, human curators of news, more like yahoo! news did back in the day? sarah: facebook has never characterized themselves as a new site. it's never characterized itself --a problem gator promulgator as news. putting that responsibility on them from a human editing perspective raises their liability. emily: but the reality is so many other users are seeing their news through facebook. >> that's fair. i think there may be some automated tool solutions, and don't forget the power of users themselves, to be able to self manage and self regulate. there's quite a lot about already. zuckerberg could put more tools
in place to enable the individuals to manage that as well. >> if people are only clicking on stories they agree with, maybe they won't understand what's fake, or maybe they have been lking their own tools to discover what news is or isn't, to be believed. >> that's a challenge. that's a challenge even before facebook came along. people often choose to hear information they want to hear. they choose fox news over cnn in the same fashion. so how much of that responsibility falls back to zuckerberg and facebook versus the individual and consumer, and the education system we try to foster acceptance of different voices? emily: sheryl sandberg did publicly endorse hillary clinton in this particular election. let's talk about snapchat. they have filed to go public, they filed to go public before the election. is snapchat facing any of these allegations? are they in a different place because the content is so ephemeral?
sarah: the funny thing about snapchat is that they are not feed-based. it's not even one of those situations where you are sorting through who to follow. they show you what to look at, they have their discover channel that has media partners creating content. they have live stories that have covered rallies by clinton and trump. both candidates have advertised on the platform. snapchat's really not been affected by this as much. it is more ephemeral content that people are sending to each other. internally, i don't think snapchat executives, even though they filed to go public before the election, i don't think they are worried about a trump presidency. everything seems to be on track over there. emily: jennifer, you were just awarded vc of the year by deloitte. i'm curious how you are looking at investing in social media right now. you started a new fund a few years ago.
given now the power of facebook and twitter and snapchat, do you see social media as -- is there really room for growth there? >> there continues to be amazing innovation. the conversation is driving an interface. most of the innovation we're seeing in investing is moving towards where the consumers are spending their time, which is on facebook messenger, imessenger. where we see the opportunity for more applications will be driven off of building on that platform. emily: facebook also facing allegations -- it has come out saying they have miscalculated the amount of time people are spending on certain ads. sarah: it's a very confusing report. basically they review their 220 metrics they get to their partners and publishers, and
they found that in 4 new cases, they actually got their math wrong in a couple of significant ways, where they overstated how much time people spend on instant articles, overstated how far page reach went, -- far page reach went, and a couple other things. this is their attempt to be much more transparent about their metrics. in light of these mistakes, they are going to have a metrics counsel that meets regularly. emily: mark zuckerberg has a lot to think about this week. sarah frier, who covers social media for us, and jennifer, thank you both. coming up, we will be talking more about cisco. also, billionaire and twitter investor prince al-waleed bin talal spoke to us. he weighed in on the state of his various investments, namely twitter. despite its falling stock price and questions surrounding a sale, prince al-waleed remains optimistic about the future of the site under jack dorsey.
>> jack dorsey took over a year ago. he established many initiatives. i think this have to begin sometime. i'm optimistic. we have seen twitter clear up the floor. anything above that would be sweet for us. we still believe the best days are yet to come. emily: still ahead, jim chanos, noted short seller, holds nothing back on the tesla-solar city tie up, and trump's impact on tstocks. this is bloomberg. ♪
emily: tech stocks have crept back slightly in recent days and many have been questioning what a trump residency will mean for technology, specifically facebook, amazon, netflix, google. kynikos' founder jim chanos joined joe weisenthal and scarlet fu earlier and asked what president-elect trump means for big cap u.s. tech. >> i think there is some basic narrative about technology in silicon valley being out-of-favor, just like middle america was in favor. again, as we've said, who knows? it's too early to tell. >> prior to this election -- the recent moves aside -- did what we see in these big tech stocks look bubbly, like investors were casting aside rationalism about valuation? >> there are certain things we think are overvalued, and the business models are more questionable.
and others are borderline cheap. >> which ones are cheap? >> not going to disclose where we are specifically. the point being, i think everything is moving together right now thematically. over time, that will dissipate, and the companies will be judged on their own merits. take a look at something as simple as net neutrality, which the obama administration embraced, and basically hamstrung the telecom companies to the positive of the internet companies. he's in the past talked about that not being fair to the telecom companies. companies that have benefited from net neutrality have gotten hit pretty hard. but will he enact anything? we don't know. >> what do you think about what a president donald trump would mean for big deals that are still pending, such as at&t, and its effort to buy time warner?
>> if we are right above possibly our populist theory, i think there will be fewer business combinations. those tend to not happen in those time periods. he indicated skepticism on a couple big deals. >> we are a day away from a shareholder vote on the merger of tesla and the sister company, solar city. you have been really negative about tesla and the elon musk family of companies. tesla's come off a bit, but it is still very high compared to where it was a couple years ago. there is still a lot of faith in the company if you ultimately change the world, perhaps. what do you make of this combination right now? >> i think the combination is absurd. i've said that. i don't know if i can sugarcoat it anymore, but it's ridiculous. first solar's results, while they are not a rooftop company, just goes to show the risks that are inherent. there's deflation going on in
the solar business, and tesla is taking on these debts. there is negative cash flow at solar city. the shareholders of tesla truly have to have their heads examined if they vote this deal in, but they might. and they very well could. ruin the dayg to they did it, but they may in fact do it. >> what tesla and solar city has going for them is elon musk. he is an incredible master of generating capital, whether it is in -- >> raising capital. >> huge distinction, yes, raising capital in public markets or through private investors or subsidies. what is the story that musk is telling, and why is it so effective? >> i was at a conference a few weeks ago, and someone asked me -- in silicon valley -- and
someone asked me about this merger, and the business models of tesla. i made my usual snarky comments about it, and later that night someone well-known sort of silicon valley person came up to me and started poking me in the chest, saying, you don't get it. maybe that's part of the problem. here in wall street, we're pretty much focused on numbers and business models and is something sustainable, cash generation, and do you make a profit, are you competing in competitive businesses? there it's a much different viewpoint. it's almost a holistic type of a viewpoint. if it doesn't work in this, it will work something else out. he's a genius. so far, that's been right. >> how is it different than amazon, where there has been a band of people on wall street who say they are blowing tons of money and they show growth.
>> completely different. >> what's the difference? >> when tesla and alibaba get compared to amazon, i really just have to laugh. amazon went public in 1996. the last equity offering was in 2001. they have been free cash flow positive every year since then. so, amazon's business model was brilliant. it was basically the glorified dell model, in which we buy something on amazon, our credit card gets charged immediately, he pays the suppliers of his inventory 90 to 180 days later. we financed amazon's growth until very recently. amazon only has about 20 billion invested in its entire business over 20 years. that's nothing. bezos' genius was to create a platform like apple did, and there were synergies off that platform. elon musk is in the auto business. that's a whole different business.
inly: cisco shares dropping quarterly earnings. sales and profit that indicate corporate spending on tech infrastructure is slowing. joining me from new york, glenn o'donnell. thank you for joining us. obviously cisco in the midst of a big transition. how would you rate therogress of the transition under the new ceo chuck robbins so far? >> we haven't seen the real results of the full transition yet. a lot is changing at cisco. this is a giant company going through some pretty major changes.
i'm not surprised that cisco is having trouble with its earnings and revenue right now. it is a flattening market. compound that with the fact that chuck robbins is changing the company in some pretty dramatic ways. and, he's made some really good progress in making those changes. but it is going to take some time until we see the residual effects of that. where he's going to take the company into some of the growth areas. emily: let's talk about cloud computing. this is an area where amazon, microsoft, even google are winning, yet you have some of these older school tech giants like cisco, hp, dell, oracle trying to take on the cloud as well. how likely is it that cisco will find strong footing here? >> we've written on this recently about the changing market landscape and how the cloud companies are getting a lot of the corporate technology spending these days.
that is at the expense of the companies you just mentioned, cisco being one. it's a tough market for those players, and they all have to transform what they are doing to succeed there. that's not just selling to the cloud providers. all of that stuff needs technology. but they are not necessarily selling it to the cloud providers. they have to look elsewhere. some growth areas around internet of things, for example, that will be a massive force in our world in general. there is going to be a lot of spending there, and that's not necessarily all going to cloud. companies like cisco can capitalize on that, but it's a big departure from the past. it's a big focus of chuck robbins with some of his m&a. emily: i sat down with chuck robbins a couple of months ago, on the one-year anniversary of him taking over from john chambers. i asked him about the election, as i understand it he has traditionally voted republican,
however he would not tell me who he was voting for, unlike many other silicon valley executives who came out strongly against donald trump. what would a trump presidency me for a company like cisco that is a global company, and has been a bellwether for the global economy for so many years? >> i don't know that it's going to make that big of a change for cisco. president-elect trump has made it pretty clear he wants to build our infrastructure, and that could well for a company like cisco. but a lot of that infrastructure is more the physical infrastructure, highways and bridges and that kind of thing. and there you have got to question how much a company like cisco can benefit from that. maybe some of the politics -- the geopolitics of the trump administration could impact some international trade, but i think
haidi: 1:30 p.m. in hong kong. the bank of japan is to release a limited amount of bonds at a fixed rate. after deciding in september that it would lower the yield curve. positive yields for the first urodasince governor k announced the shift. a chinese billionaire is stepping up to disney with his second $15 billion project in a week. he will build commercial centers
, including a resort. plans to have 15 wanda complexes across china by 2020. j.p. morgan chase will pay $2 million to settle investigation into hiring practices in china. it accused officials of peddling to win business. five other wall street banks are still being investigated. opec nations and russia meet today, but iran and iraq will not be there. the cartel is trying to reach an agreement on output cuts, but tehran and baghdad say they will not lower production. opec has struggled to reach a deal in algeria in september and 18 hours of talks in vienna last weekend failed to bridge that divide. this is bloomberg. let's take a look at how this market situation in asia is
faring. we had a bit of a reversal and mixed picture at last check. but let's go to juliette saly. juliette: markets tracking higher today, but we are seeing a bit of weakness coming through in shanghai. the shanghai composite down by 2/10 of 1%. a lot the market saying that perhaps the rally has gone too it entered a bull market, and there is a little bit of concern that those gains are overdone. in hong kong, we are also seeing a little weakness, but we have had positives on the hang seng. we are seeing a bit of weakness from hsbc and also tencent, despite the fact that its earnings beat market expectations. anaustralia, you are seeing upside of two jensen 1% on the close. we had australia close about half an hour ago. the unemployment rate remaining of october.he month
a positive session coming through in the philippines. 8/10 of 1%. by there was a better than expected third-quarter read in terms of gdp for the philippines, 7.1% year on year. london at thee in top of the hour here on bloomberg television. ♪ this is "bloomberg tech." i'm emily chang. considered by is many to be the obama administration's signature policy on tech. remember, net neutrality is the idea that internet service providers can't create fast and slow lanes for web traffic, putting companies like netflix at their mercy. the fcc passed rules in 2015 prohibiting this, but the election of donald trump has many industry watchers concerned that net neutrality could end up on the chopping block come 2017. while he did not have a clear policy on the issue, trump once tweeted in 2014, obama's attack on the internet is another top-down power grab.
net neutrality is a fairness doctrine, will target conservative media. joining us to discuss what may happen to the idea under a trump administration is larry downes, also with us from washington, baron socha. larry, you know this issue inside and out. the idea is that trump would eliminate net neutrality. what do you think it actually happen? >> i don't think that is what will happen. in that tweet you mention, it was in response to president obama's announcement that he wanted the fcc to turn the isp's into public utilities. that's a part of the ruling that will go. but i think the net neutrality rules themselves aren't all that controversial. either congress or new fcc may move them back to the federal trade commission, but i don't think they are going anywhere. emily: that means you think it will remain basically business as usual. no fast and slow names -- slow lanes. >> for net neutrality.
not business as usual for this reclassification of isp's as utilities. emily: what will it mean for netflix? >> it won't change anything as far as netflix is concerned area in fact, none -- is concerned. in fact, none of these rules were really being violated in the years before the fcc had rules in the first place has the federal trade commission was already on the job enforcing them. emily: baron, our bloomberg intelligence analysts have outlined three possible ways that the policy could change. one, through the courts. we're expecting trump to appoint another supreme court justice through congress, limiting the via a newity, or trump appointed chair, the fcc would then change the rules themselves. what you think is the most likely path forward? >> you can count on the new fcc chairman to start undoing the legal claims of authority that underlay the two open internet orders we've seen. once that happens, i think it will by default kick the issue back to the federal trade
commission, which as larry said could have addressed this issue starting about 10 years ago. and in that really forces democrats to decide, do they really want to take a legislative deal that republicans offered them last year? if they do, they may succeed in getting some version of the issue back to the federal communications commission, or they may get the federal trade commission to have rulemaking power. i think larry is basically right, you will not see this issue change fundamentally. the 2010 rules were never really controversial at their core. industry, if they had to, would sign up today to a self-regulatory pledge that would be enforced by the federal trade commission. emily: there has been debate over the authority of the ftc in general, whether it's net neutrality or other issues. do you think that authority will
again be questioned in a trump administration? >> i think so. in 1996, did congress give the fcc any authority over broadband? that is what we have really been fighting about for the past 10 years. it's not really clear. congress may step in and make this much clearer than they did. that was part of the bill that baron mentioned. the fcc may voluntarily sort of reinterpret it themselves and say, no, we are going back to the version all along up until chairman reeler -- chairman wheeler, but that will definitely be a keystone of what the new fcc will do, the side what did congress really mean, what is our limit? emily: when it comes to m&a, trump is indicated he's not a fan of the at&t-time warner measure. at best, what he believes, no one really knows. it's been a little confusing. there's been other analysis that trump could be good for m&a. that a sprint-t-mobile could merge in this era if they wanted to.
how do you think the trump fcc will weigh in on m&a issues? >> there's no way to tell. we have to wait to see who becomes chairman and who takes over antitrust at the department of justice. but the people who actually follow these things are in general skeptical of the need for government intervention and are generally more willing to let deals go through, and if there are issues, demonstrated harms to consumers, to come up with conditions that would respond to those instead of blocking deals or using conditions just to regulate without going through the normal process, as the obama administration has done. i think probably we will see deals more likely to go through. but it depends. and if you saw a wildcard chairman come in that might follow through on what trump has tweeted about, maybe things would be different. but there's no way to tell at this point. emily: silicon valley is an interesting position, having
been so outspoken against donald trump. yet these are some of the most valuable companies in the world. the internet association, which represents amazon, google, netflix sent a letter to trump urging him to keep the internet open and to keep it a level playing field. how do you see the relationship between trump and the tech industry playing out? do you think trump risks alienating them even further, to their detriment, perhaps? >> i hope not. again, we don't really know. there was no real tech policy position by the trump candidacy the way there was for secretary clinton. most of this is speculation. i think what we can hope for is that republicans are free trade, silicon valley likes things to be left unregulated, and hopefully those things will align and character differences will work themselves out.
emily: berin, one thing we do potentially know, trump's stance on immigration, we don't know how that would impact things like the h1b visa, that is something tech companies very much rely on. there are a lot of skilled immigrant workers who work at technology companies in silicon valley. aside from m&a, the fcc, what are the clues you are looking at based on what trump said so far about how he will approach the tech industry? >> it's anybody's guess. there seems to be a battle going on for trump's soul. on the one hand, you have the mike pence traditional republicans who are free trade and in favor of innovation and understand that high skilled immigration is what makes san francisco and the tech center work, and it's what brings talented, smart people to the united states.
on the other hand, steve bannon has said things about there being too many asians in the united states, and maybe it's a problem for our civic society, we need to do something about immigration. it's really unclear. i am not confident that we know what will happen. we are going to have to see how this transition shakes out and what happens right now in this very tumultuous process. for people who were wondering when we will know something, historically, these major appointments in the tech sector end of happening pretty close to inauguration. the fcc chairman was not named by obama until january 12 in 2009. so it could be a while, and issues like immigration, that's not an issue that will be determined by single appointment. that's going to play out in
congress, and that could take a very long time. if i were concerned about that, i would wait and see how much the administration is willing to work with or even defer to republicans on the hill, because they get issues like immigration , and if they are the ones writing the agenda, it will turn out well. emily: we will touch on that steve bannon story and his comments on the asian tech ceo's later. tech freedom president, also larry downes, longtime watcher of fcc action on net neutrality. thank you so much for joining us. tomorrow we will pick up this conversation and much more on the concerns of u.s. tech giants only speak to internet association's ceo. a story we have been watching, microsoft offered concessions to european union regulators trying to smooth the way for the planned acquisition of linkedin. europe's competition regulators started casting an eye over the megamerger in october, investigating the business activities of the two firms to determine whether the proposed merger could be bad for
emily: president-elect donald trump campaigned on a promise to tax goods manufactured in china potentially as high as 45%, part of a plan he believes will reinvigorate the united states and manufacturing by bringing it stateside. one company this could have a major impact on is apple. a chinese state-run newspaper warned americans of countermeasures if trump launched a trade war, including a tit-for-tat approach. here with me to break it all down, what it could mean for apple and other smart phone
print --rawford l crawford del prete. how much would these tariffs impact apple and iphone users? >> if you look at how these tariffs would be levied, there would be negotiation, whether 45%, 20%, 15%. that would be on what we call the oem price, the original price of the products. it's not going to be the $800 or $900. it would be something a lot less than that. for the sake of the argument, let's say you get down to $35 or $40. in all likelihood, a company as cash positive and generating what apple generates would likely eat that charge, and that would be one of their few options. another option would be to pass that along to the consumer or to split that with carriers or to other channel partners it might be selling with. it definitely hurts the consumer. emily: would that be advisable given you have other smartphone makers out there right now making decent product for a lot
cheaper? >> right. apple is kind of fighting a war on multiple fronts. they are the premium product, the premium ecosystem. there's also a huge ecosystem in android that they're competing with. in the middle of the market, you are seeing a lot of chinese and other offshore suppliers that are starting to move up and offer really premium products at mainstream price points, $299, getting you 4 gigabytes of memory and 32 gigabytes of storage and premium battery experience and really strong products. if those products aren't necessarily affected in the same way because those products -- those are not necessarily us-based manufacturers -- that becomes yet another problem for apple in this scenario. emily: that said, art most electronics manufacturers outside the united states, and if this happened, wouldn't it affect everyone equally?
>> it is a global industry for a reason. there is so much automation in, say, semiconductor fabrication. you actually don't need that factory to be based offshore. the reason those are in asia is because all the others happen in asia, and it's more cost-effective to have those factories close to the point of final manufacture. again, if you start saying, this company is a company i will tax, that is downstream ramifications for all the parts. emily: it's very complicated, but because apple assembles the phones in china yet there are parts of the process happening in thailand, malaysia, philippines, south korea. how realistic is it to bring manufacturing or some part of the manufacturing process back to the u.s.? how many jobs would that actually create? >> it would be a relatively small number. what would have to happen is that there would have to be a huge investment in robotics and automation for that to happen in the united states. you start parsing words here.
what could happen could be that apple could say, we will do final software load, final flash blue thead, we will screen on at the last moment in the u.s., and does that count as manufacturing? emily: does that count? >> it depends where the lines get drawn. pc manufacturers have done some of that final configuration for years in the u.s. you look at a company like cbw that does final storage configuration and final software load in the united states. does that count as manufacturing? it's really final configuration, but it does employ people to do that. emily: but you are saying realistically, it's not going to be that many jobs. >> realistically, it's not going to be that many jobs. also, it would add cost to the supply chain. the semiconductor and screen factories and other electronics assembly factories in asia are not moving back anytime soon. so now you're writing transportation costs. emily: quickly, how many jobs? hundreds, thousands? >> that you could potentially add? it could be measured in low thousands.
emily: crawford del prete, chief research officer at idc. always great to have you on the show. >> thank you. emily: a programming note, in this week's david rubenstein show, david sits down with the alphabet executive chairman eric schmidt. they discuss cyber security risks from russia. >> do you think the united states government is better at cyber terrorism than other governments are against us? >> the one that i worry about the most about right now is actually russia. if you look at their actions in the last few months, they've done a number of very publicized invasions of tax and alterations which can only be understood as cyberactivity, and they are not shy about it. they don't mind people knowing about it. this must be part of their strategy to keep in our face. emily: you can watch david rubenstein's full conversation with alphabet executive chairman 8:00 p.m. eastern on bloomberg television. more of "bloomberg tech" next. ♪
emily: china web giant tencent reported earnings. profit missed, but revenue beat, and that is due to smartphone games, performance-based ads, plus payments and cloud services. peter alstom covers the company for bloomberg news and joins me now from our tokyo bureau. tencent has tried to transform the biggest revenue streams in its business here. how well is that going? >> well, it's a pretty interesting quarter. the company boosted revenues more than 50%. by almost any standard that would be considered strong growth. at the same time it is investing heavily in these new ventures, and that's the reason you saw net income rise a few notches more slowly than that. the company is the dominant player in messaging services through wechat and qq. it's now investing more
aggressively into cloud services and new kinds of games and media content, into online payment systems too. it has a bunch of new initiatives it's trying to invest in and expand its revenue in first year, and also get out ahead of a slowing chinese economy. emily: messaging services, as you said, wechat, qq, have been essential to tencent's growth. what are some of the trends they are seeing there? any signs of slowing growth? >> for context, wechat has about 840 million users. that's about twice as many as twitter. it's the most popular messaging service within china. tencent also has the qq messaging services. growth is slowing a bit because they've now been adopted by almost the whole population. tencent is now focused on trying to monetize those more. one, they are selling more advertising through those mediums as they offer new services.
there also marketing games and other digital goods through them. they are very popular channels for all sorts of promotions. 10 sent is true -- tencent is trying to take advantage of those. emily: bloomberg has reported that a trump presidency would have an outsize impact on alibaba, of all the chinese tech giants. what might it mean for tencent? >> it's probably more of an issue for alibaba at this point. tencent's business is almost entirely within china. it has ambitions to move beyond china. it recently bought a super cell. it is selling some of these games globally, but at this point it's been mostly focused on china. it has ambitions to expand in that direction, but it would sort of depend on how it executes that expansion. emily: peter alstom joining us from tokyo. thank you so much, peter, for weighing in. a story now that is trending, some controversial comments from
president-elect trump's closest advisers are resurfacing. "the washington post" highlighted an interview between trump and steve bannon last year on the breitbart news network. the two men talked about foreign-born employees in the united states, specifically in tech. bannon said when 2/3 or 3/4 of the ceo's from silicon valley are from asia and south asia, then the country is more than an economy, but a civic society. some are interpreting that to mean that he thinks there are too many asian ceo's in tech. that does it for this edition of "bloomberg technology." whatever, all -- remember, all episodes are now streaming live on twitter. check us out at bloomberg tech tv. this is bloomberg. ♪
unleashes itsj first unlimited bond buying a operation as if fixed to take control of the world the second biggest debt market. bank of japan prime minister to become the first foreign leader to meet with president-elect trump. obama and merkel make a joint plea for a socially responsible economy and free trade as the u.s. president's farewell tour takes him to berlin.