> THIS IS "BLOOMBERG TECHNOLOGY," WITH CAROLINE HYDE AND ED LUDLOW. CAROLINE: WELCOME TO "BLOOMBERG TECHNOLOGY." I'M CAROLINE HYDE IN THE BLOOMBERG WORLD HEADQUARTERS IN

NEW YORK. THERE IS A LOT TO GET TO AT THIS HOUR, BUT LET'S START WITH THE POLITICAL TURMOIL IN FRANCE. A NO-CONFIDENCE VOTE COULD TOPPLE THE CURRENT GOVERNMENT.

CAROLINE IS THERE FOR THE LATEST ON THE DEBATE. FOR OUR GLOBAL TECHNOLOGY AUDIENCE, WHAT CAN WE EXPECT FROM THE NEXT HOUR? >> THE DEBATE JUST STARTED INSIDE THE NATIONAL ASSEMBLY

BEHIND ME. THE LEADER OF THE FAR-LEFT GROUP IN THE NATIONAL ASSEMBLY IS THE GROUP PROPOSING THIS MOTION OF NO-CONFIDENCE IN ORDER TO TOPPLE THE GOVERNMENT AND MAKE THE... MICHELLE VON GOVERNMENT

COLLAPSE. WE ARE PRETTY SURE OF THE OUTCOME AS WE SPEAK, GIVEN THE NO-CONFIDENCE VOTE AS PRESENTED. THE TWO EXTREMES ARE JOINING FORCES TO OVERTHROW THE

BORNIER GOVERNMENT. CAROLINE: FOR THE AUDIENCE THAT CARES ABOUT FRENCH TECHNOLOGY STARTUPS, WHAT DOES IT CHANGE? A COLLAPSING GOVERNMENT, WHAT DOES IT MEAN FOR THEM?

Of course, the main question is: will we have a 2025 budget? And what is left in the budget? There will probably be special laws in order to roll it over.

But that means a lot of help and, for example, a reduction of contributions from companies in order to hire the lowest-income employees. This presents an index on inflation; it will cost more

for those companies to hire some of those employees. Technically, in the short term, it's unclear, but in the longer term, if there is still no budget over the next few weeks

before the end of December, that will have a big impact on companies. We will have this 2024 budget staying the same without increase. Caroline: We will come back to you on the breaking news, Caroline, thank

you. Despite political turmoil worldwide, the NASDAQ is at a record high, the S&P is at a record high. We have tech to thank for it.

Salesforce is also at a record high, up 8.7% on the back of its record earnings, pulling out the power from its focus. This applications software company is rising on the back of the beaten raise for earnings after the bell. Ma Bell.

Marvell Technology is now up 20%, soaring to a record high. This is the chip company that had better-than-expected results and a stronger earnings forecast. What is notable is

that the CEO, Matt Murphy, stated on the call that he's committed to the company, despite being a potential contender to lead Intel.
That is where we want to go

next. The new Intel CEO is the focus at the moment. Is Intel going to focus heavily on outsiders? The chipmaker is considering candidates like

Matt Murphy and Pat Gelsinger, who recently quit that board. Let's bring in Ryan Gold for more. Ryan, is it surprising to see Intel not go to its own bench?

Ryan: I think it is.
It's the first time since they were founded that they are thinking about looking outside. It gets to the heart of what it means to be in the semiconductor industry

right now.
It takes a lot of expertise, and some of the decisions made over the years, you know, by Bob Swan, Chris Swecker before him—these were decisions that would pay off,

IF YOU MADE THEM WRITE FOR 10 YEARS. THAT'S HOW LONG IT TAKES TO GET THINGS LINED UP IN SEMICONDUCTORS. TO THINK ABOUT YOUR NEXT CEO IS NOT EASY. CAROLINE:

MANY WOULD SAY HE WASN'T GIVEN THAT MUCH TIME. IN MANY WAYS, HE WAS A LIFELONG EMPLOYEE, STARTING HIS CAREER THERE. WHAT, THEREFORE, IS THE ATTRACTIVENESS OF THE ROLE AT

THE MOMENT? SHOWING THE POWER OF AI STRATEGY, IS IT NOT THAT APPETIZING A ROLE TO TAKE ON? >> IT COULD BE A POISON CHALICE. SOME PEOPLE DID VIEW IT THAT WAY WHEN YOU THINK ABOUT THE

CHALLENGES. WHEN YOU THINK ABOUT AMD, A BIG RIVAL, THEY MADE THAT DECISION YEARS AND YEARS AGO. CAROLINE: EVEN MORE. ED: AND WE ALL KNOW -- RYAN: AND WE ALL KNOW HOW THAT WENT. WHOEVER COMES IN HAS A MASSIVE

CHALLENGE ON THEIR HANDS. THE FACT THAT WE CONSIDERED MATT MURPHY BEING CONSIDERED YESTERDAY, REMEMBER, THEY ARE A BIG ADVOCATE FOR MAKING INTEL MORE OF AN INDUSTRIAL MANUFACTURER.

THAT COULD BE INTERESTING, BUT THERE ARE MANY OTHERS. WHEN WE TALKED TO SOURCES, WE HEARD THAT ANYONE WHO PUTS THEIR HAND UP WITH A RELEVANT DEGREE AND EXPERTISE IN SEMICONDUCTORS WILL BE CONSIDERED.

AND I CAN TELL YOU THAT AS THEY RUN THE PROCESS RIGHT NOW, THEY ARE SAYING THAT THEY ARE PROBABLY LOOKING AT FOUR OR FIVE CANDIDATES AND THEN A SHORT LIST OF ONE OR TWO. CAROLINE: TIMEFRAME? RYAN: AS SOON AS POSSIBLE.

CAROLINE: RYAN, KEEPING US UP TO SPEED, THANK YOU. LET'S GET A DEEPER LOOK AT THE CHIP SPACE TECH MARKET MORE BROADLY. MORE THAN $9 BILLION UNDER MANAGEMENT, YOU LOOK LIKE YOU

ARE IN EVERY CHIP NAME APART FROM INTEL, TONY. IS THAT RIGHT? HOW ARE YOU LOOKING AT THE ECOSYSTEM AND ITS STRENGTH? >> GREAT QUESTION. WHEN YOU LOOK AT OUR HOLDINGS, WE ARE LOOKING AT THE COMPUTE ASPECT.

NVIDIA IS A BIG HOLDING ALONG WITH MARVELL AND BROADCOM. THE FOUNDATIONAL MODELS ARE GROWING EXPONENTIALLY EVERY YEAR. IT WILL BE ADVANTAGEOUS IN CAPTURE. I LIKED THE SPACE LONG-TERM, BUT WE ARE SELECTIVE IN OUR

HOLDINGS HERE. SPECIFICALLY THOSE THREE, ESPECIALLY. CAROLINE: LET'S TALK ABOUT MARVELL, FOR EXAMPLE. WOULD YOU WORRY IF THE LEADER JUMPED SHIP TO INTEL? TONY:

MATT MURPHY HAS CREATED A TON OF VALUE OVER THE YEARS. WHEN HE PICKED IT UP IT WAS A SUB-$1 BILLION MARKET CAP AND OVER THE YEARS HAS DONE A LOT OF GREAT M&A, CAPITAL

Allocation, spun-off businesses, acquired a world-class custom team to compute chips for the likes of Amazon, for example. It would be a concern if he jumped ship. I do think that he has put a

lot of work into it, has a great team, and they are kind of firing on all cylinders coming out of the last few years. From my perspective, it seems like he has a lot of good

reasons to stay at Marvell. I'm taking his word for what he said last night at face value. Caroline: Marvell is one of the Intel holdings, 2% of the fund.

The top is Nvidia, as you mentioned. Matt Gelman was on our network yesterday, and we will be playing a bit of that sound later. But Amazon is the best points contributor to the Nasdaq today.

They had a raft of chip announcements. What does it mean for Nvidia and in terms of their own customers building custom silicone? Tony: I don't think that that story is anything new; it's just the evolution of compute and its

general purpose, those chips. Over time, as the world gets bigger, they ensure and stabilize and bring in the custom compute. The two kind of coexist and have coexisted over the last decade.

So, going forward, I think of them as kind of symbiotic in a relationship, in some ways. Just evidence that the chip is increasing in demand because the workloads are so

big, it makes sense to have a custom chip. But once we move on to 5, 10 years ago, we thought AI would just be subject to only identifying what was a cat and

what was not a cat image. Now it has transformed into something no one could have thought about or predicted. I think it's just that we have had this debate before, but

what we have seen is that both NVIDIA and the custom chip providers have done well as they have increased. Caroline: I am not a cat, to forever be part of the story of the

internet. What about the evaluation of NVIDIA at these levels? From the perspective of AI, using it in our everyday life, can they grow in terms of their own valuation, or has it all been priced in?

Tony: Ryan: -- Tony: That's a great question. The market cap right now is astounding. Profitability within cash flow was pretty reasonable, right?

30, 30 times earnings. While the stock price has gone up a lot, when we look at it, it's not an extreme, 100 times earnings. I think it says that the market is saying that there

is a bit of concern over how sustainable the numbers are and if profitability can continue at these levels. So, I think the valuation there is relatively moderate, you

know, given its history and growth. Caroline: It's extraordinary to think that at this day we were at a record high in terms of market cap, and then you have the Salesforce numbers and their own record high in terms of

share price. What do you make of their application and whether it will make them more profitable getting off the ground? Tony: It's an exciting time, in fact. AI could be the next productivity revolution,

uncapping layers with digital agents and flavor that essentially doesn't need to take breaks, operates 24/7, can operate alongside humans. It's really exciting.

All of these software companies are now kind of seeing the opportunity and going after it. Everyone wants to be the platform where you store your data and operate. Whatever the offer is, it's a big opportunity.

WE HAVE SEEN THE FIRST BIG YEAR DOMINATED BY CHIP COMPANIES LIKE NVIDIA ON THE INFRASTRUCTURE LAYER.
WHAT YOU NEED TO SEE IS THE APPLICATION LAYER FOR CHIP COMPANIES TO CONTINUE DOING WELL, AND I THINK WE ARE SEEING THAT IN THE LAST EARNINGS SEASON.

CAROLINE: YET WE HAVE SEEN THAT SHIFT IN MOVEMENT FROM ALL-IN ON CHIPS HEADING INTO SOFTWARE, AND BOY, IT'S PLAYING OUT WITH PALANTIR,

TRADING AT 80 TIMES EARNINGS, THE DARLING OF THE AI STORY.
WILL OTHER COMPANIES BE ABLE TO REACH THOSE VALUATION LEVELS, OR IS PALANTIR OVERVALUED AS WELL?

YOU TALKED ABOUT A CRUCIAL MOMENT WHERE AI DISRUPTS THE WORKFORCE, BUT THE MARKET HAS BEEN TRYING TO PRICE THAT IN FOR QUITE A WHILE. TONY: ABSOLUTELY.

NOT EVERY COMPANY CAN BE LIKE WHAT PALANTIR IS DOING. THEY HAVE BEEN AN AI LEADER FOR THE LAST DECADE.  THEM BRINGING AI TO THE GOVERNMENT AND THE ENTERPRISE. I THINK WHAT IS SPECIAL ABOUT THEM IS THEY HAVE THIS VERY

CENTRALIZED TECHNOLOGY FOR AI, AND THEY CAN CUSTOMIZE IT FOR CLIENTS, AND CLIENTS CAN BUILD ON IT. THEN IT'S LIKE A PLATFORM.
WHEN YOU THINK ABOUT THE U.S. GOVERNMENT AND WHAT THEY ARE TRYING TO DO NOW, IT'S BEING

More efficient and bringing AI technology into automating things and modernizing data processing. I don't think every company can be like that. There are some special ones in the AI software area.

There are specific vertical applications where they can drive intelligence. Caroline: Tony, brilliant to have you on there from T. Rowe Price. Thank you. The latest on the tragic story out of New York City: the CEO

of the UnitedHealth Insurance division was fatally shot in the chest outside the New York Hilton Midtown, where they were hosting an investor day, according to people familiar

with the situation. Early reports suggest the attack was targeted, according to someone familiar. The NYPD is expected to provide an update, and we will continue to bring you the latest on TV and radio throughout the day.

Caroline: Last week we reported that the FTC is investigating Microsoft and how they are bundling Windows operating systems with other software and their dominance in the cyber market. Reports are saying the agency

is asking about the deal with OpenAI, giving the cloud giant the exclusive right to run the service and a cut of the company's revenue. David Belton joins us now. He formerly worked at the Bureau of Competition.

WELL-VERSED IN HOW LONG THESE INVESTIGATIONS CAN GO ON. THE WAY THAT THE FTC IS PURSUING MICROSOFT, DOES IT SEEM SIGNIFICANT TO YOU?
DAVID: IT'S VERY IMPORTANT.

THE MICROSOFT CASE FROM THE LATE 1990S WAS CRITICAL TO THE EXPANSION AND GROWTH OF THE INTERNET. MANY OF THE THINGS THAT WE BENEFIT FROM IN TERMS OF COMPETITION ON THE INTERNET ARE SPECIFICALLY BECAUSE OF THAT

EARLIER CASE. CAROLINE: WHAT'S INTERESTING IS, OF COURSE, WE HEARD BACK FROM THE MICROSOFT DEPUTY GENERAL COUNSEL, WHO SAID THAT ON

BEHALF OF MICROSOFT, THE INSPECTOR GENERAL IS LOOKING INTO IMPROPERLY LEAKED INFORMATION ABOUT ANTITRUST INVESTIGATIONS. HOW DO YOU SEE THESE SORTS OF INVESTIGATIONS WHEN THEY BECOME PUBLICLY KNOWN BEFORE MICROSOFT HAS A CHANCE TO RESPOND?

DAVID: I'M EXTRAORDINARILY SKEPTICAL ABOUT WHETHER OR NOT THE AGENCY, WHETHER THERE WOULD BE SOME SORT OF LEAK FROM THE AGENCY. THAT'S EXTRAORDINARILY UNUSUAL. THIRD PARTIES, HOWEVER, WHO

OVERSEE INVESTIGATIVE DEMANDS CAN DISCLOSE WHATEVER THEY WANT. THIS MAY BE A SITUATION WHERE ONE OF THOSE PARTIES DISCLOSED INFORMATION TO THE PRESS ABOUT THE REQUEST THEY HAD RECEIVED.

FROM THE FTC. CAROLINE:
OF COURSE, THIS IS WIDE-RANGING. BLOOMBERG IS FOCUSING ON THE WAY
THEY INTERTWINED THEIR OPERATING SYSTEM AND DOMINANCE IN
CYBERSECURITY, NOW TALKING

ABOUT OPENAI.
LISTEN TO THIS CONVERSATION I HAD WITH THE AWS CEO YESTERDAY
TALKING ABOUT HOW HE WOULD LIKE TO OFFER HIS OWN CLIENTS ACCESS
TO OPENAI MODELS, BUT CAN'T AT

THE MOMENT. >> I BELIEVE WE WOULD LOVE
OPENAI MODELS IN AWS. ABSOLUTELY.
WE LISTEN TO OUR CUSTOMERS; IF THAT'S SOMETHING THEY WANT, WE
ARE ABSOLUTELY GAME.

WITH A PARTNERSHIP, IT TAKES
MULTIPLE SOURCES, AS YOU ALLUDED TO, BUT IN THE FULLNESS
OF TIME, THAT WILL LIKELY BE THE CASE. CAROLINE:
THEREIN LIES SOME OF THE ISSUE

THAT THE FTC IS INVESTIGATING,
THIS RELATIONSHIP BETWEEN OPENAI, MICROSOFT, AND WHETHER IT HAS
BROKEN OPEN A LITTLE. SEEMS THAT MATT GARMAN IS
POSITIVE IT WILL.

DO YOU THINK THAT WILL
ULTIMATELY BE DONE BY SELF-REGULATION OR FTC
REGULATION? DAVID: NO, THE FTC IS GOING TO TAKE A
SERIOUS LOOK AT THIS RELATIONSHIP AND THE POTENTIAL
FOR THAT RELATIONSHIP TO

FORECLOSE OTHER RIVALS, OTHER FORMS OF COMPETITION. THEY ARE GOING TO TAKE A CLOSE LOOK AT THE NATURE OF THE RELATIONSHIP BETWEEN OPENAI AND MICROSOFT. ED: DO YOU THINK A LOT OF THESE

CLOUD COMPANIES ARE HAVING THESE RELATIONSHIPS WITH OTHER COMPANIES, WILL THEY BE GENERALLY LOOKED AT ACROSS THE BOARD? DAVID: YES, BUT IT IS ALWAYS IMPORTANT

TO REALIZE THAT MICROSOFT IS DOMINANT IN CLOUD COMPUTING AND SOFTWARE CATEGORIES. WHEN THE FIRM TAKES THAT DOMINANCE AND EXTENDS THAT DOMINANCE TO OTHER PRODUCT MARKETS AND FORECLOSES COMPETITION IN THOSE MARKETS,

IT VIOLATES THE ANTITRUST LAWS. CAROLINE: I FEEL THAT AWS WOULD HAVE SOMETHING TO SAY ABOUT AZURE BEING ALL THAT DOMINANT. THEY FEEL THEY OWN A LOT OF THE

MARKET. ORACLE FEELS THEY HAVE A KEY STAKE. GOOGLE AS WELL.  CAN YOU HAVE BROUGHT [UP], LESS OLIGOPOLY-LIKE CLOUD OPERATIONS WHEN THIS IS ULTIMATELY INCREDIBLY EXPENSIVE TO OFFER?

DAVID: I THINK THAT IS ONE OF THE CONSIDERATIONS KEPT IN MIND HERE. WE HAVE SEEN MANY MARKETS WHERE THERE ARE NON-CONTRACTUAL ARRANGEMENTS THAT FORECLOSE COMPETITION, WHERE COMPETITION

FLOURISHES.
IT IS SPECIFICALLY THOSE ARRANGEMENTS, LIKE THE ONE
BETWEEN MICROSOFT AND OPENAI, THAT WILL RECEIVE INTENSE
SCRUTINY. YOU KNOW, ESPECIALLY BECAUSE
MICROSOFT IS SO DOMINANT IN

CLOUD COMPUTING. CAROLINE:
AND DOMINANT IN CYBERSECURITY, AND IN MANY WAYS, REPORTING IS
SUCH THAT THE INVESTIGATION STARTED BECAUSE OF SOME OF THE
FAILINGS TO DO WITH CYBERSECURITY WHEN

IT CAME TO FEDERAL PROVISIONS.
IS THAT WHAT SPARKED ALL OF THIS, DAVID?
HOW WILL THIS WEATHER A TRANSITION INTO A NEW
ADMINISTRATION? DAVID: FIRST OF ALL, IT SUGGESTS ONE
OF THE REAL ADVANTAGES OF

HAVING A FEDERAL TRADE
COMMISSION THAT DEALS WITH CONSUMER PROTECTION ISSUES, THE
FAILURE TO PROVIDE ADEQUATE CYBERSECURITY, AND
COMPETITION ISSUES. I THINK THIS IS AN
INVESTIGATION THAT WON'T LOSE

ANY STEAM IN THE TRUMP
ADMINISTRATION. THE KINDS OF LEGAL ISSUES HERE
ABOUT WHEN BUNDLING IS LEGAL AND ILLEGAL. I THINK THERE IS A STRONG
CONSENSUS BETWEEN REPUBLICAN AND DEMOCRATIC ANTITRUST
ENFORCERS, AND I EXPECT IT WILL

GO FULL THROTTLE IN THE NEXT
ADMINISTRATION. CAROLINE: DAVID BALTO, FORMER DIRECTOR OF
THE FTC, THANK YOU FOR YOUR TIME.
COMING UP, DAVID ELLISON EYEING BIG CHANGES TO PARAMOUNT.
MORE ON THAT, NEXT.

THIS IS "BLOOMBERG TECHNOLOGY."
♪ CAROLINE:
BIG CHANGES COMING TO PARAMOUNT GLOBAL.
THE EXPECTED NEW CEO IS EXPLORING COMBINING THE TV UNITS,
INVESTING MORE IN STREAMING, AND

OVERHAULING TOP MANAGEMENT.
THIS IS EXPECTED TO HAPPEN WHEN THE SKYDANCE MERGER IS
FINALIZED NEXT YEAR. META IS LOOKING TOWARDS NUCLEAR
ENERGY FOR ITS AI AMBITIONS. THEY ARE ASKING DEVELOPERS TO
SUBMIT PROPOSALS FOR ONE TO

FOUR GIGAWATT REACTORS, STARTING
IN EARLY 2030. THE SCALE OF THE ELECTRICITY GENERATED IS
ENOUGH TO POWER 750,000 HOMES. AND ILIAD IS SET TO SELL HALF
OF ITS DATA CENTER BUSINESS TO

A FRENCH COMPANY.
THEY ARE IN EXCLUSIVE TALKS TO SELL A 50% STAKE FOR A TOTAL
ENTERPRISE VALUE OF $904 MILLION.
COMING UP, WE'LL HAVE MORE ON DATA CENTERS.
MY CONVERSATION WITH AMAZON WEB

SERVICES CEO ADAM SELIPSKY ON THEIR
MAJOR PLANS FOR AI. THAT'S NEXT. THIS IS "BLOOMBERG TECHNOLOGY."
♪ CAROLINE:
WELCOME BACK TO "BLOOMBERG TECHNOLOGY."
CAROLINE HYDE IN NEW YORK.

MARKETS ARE AT NEW RECORD HIGHS.
THE NASDAQ, S&P 500, APPLE, AND AMAZON ARE ALL AT RECORD HIGHS.
MANY KEY COMPANIES HAVE REPORTED EARNINGS, PUSHING TWO NEW
RECORD HIGHS.

MARVEL AT A NEW RECORD HIGH.
SO, A SALES FORCE, THE NASDAQ 100 IS UP 0.9%, AND IN LARGE PART
BEING HELPED BY CRM. THIRD-QUARTER EARNINGS ARE
LOOKING STRONG AS THE AI AGENT

FORCE COMES THROUGH TO HAVE
1000 PEOPLE OUT THERE SELLING. IN PARTICULAR, 8% GROWTH IN
EARNINGS IN TERMS OF REVENUE. LET'S BREAK IT ALL DOWN WITH
OUR BLOOMBERG INTELLIGENCE

ANALYST. MANY QUESTIONED THE
VALUE OF THE SHARE PRICE GOING INTO THE REPORT, BUT THEY WERE VINDICATED.
ANURAG:
ALMOST EVERYTHING WAS GENERALLY IN LINE WITH WHAT THEY WERE
EXPECTING.

PEOPLE ARE REALLY BUYING THE
STORY AND THE POTENTIAL FOR THAT TO DRIVE DOWN THE ROAD REVENUE. IT WILL NOT -- NOT
IMMEDIATELY IMPACT REVENUE FOR THE NEXT 12 MONTHS TO THE POINT WHERE IT MOVES THE
NEEDLE, BUT AFTER THAT IT

SHOULD START TO HAVE GOOD
MOMENTUM IN THE OVERALL REVENUE BASE. CAROLINE: IT'S A GOOD NUMBER.  THE
AMOUNT OF DEALS THEY HAVE. WHAT DOES IT LOOK LIKE, DO YOU
THINK? ANURAG:

THOSE 200 DEALS ARE NOT MOVING
THE NEEDLE WHEN IT COMES TO THE EARNINGS DATA, AND WE DON'T
THINK THAT'S GOING TO HAPPEN. WHAT WE ARE SEEING LAST NIGHT,
AT THE END OF THE DAY,

SALESFORCE WILL BE A NET BENEFICIARY OF AI. IT'S THE BIGGEST DISCUSSION AROUND THE ENTIRE SOFTWARE SPACE: WHICH COMPANIES WILL BENEFIT OVER THE NEXT TWO TO THREE YEARS, OR

LONGER, AND WHICH ONES WON'T? THAT'S WHERE SALESFORCE CONVINCES US THEY HAVE THEIR ACT TOGETHER. CAROLINE: PREVIOUSLY, PEOPLE WERE WORRIED ABOUT THAT.

WE SAW CONCERN ABOUT MARC BENIOFF'S DESIRE TO DO M&A, PERHAPS NOT THINKING ABOUT PROFITABILITY; MAKING BIG BUSINESS, SPLASHING BILLIONS ON STARTUP ACQUISITIONS.

DO YOU STILL LIKE THEM TALKING ABOUT ADDING ON?

Intel Looks Outside the Box, Microsoft Faces FTC Troubles | Bloomberg Technology

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