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All eyes on the AI data center debt debate.

We discussed stocks to watch as big tech piles on big debt.

Plus investors pull three and a half billion dollars from bitcoin ets in November as the underlying asset is its worst performance since the twenty twenty two collapse, and the CEO of Ironq joins as the company's new partnership to develop quantum enabled drones for national security rolls out.

But first let's check in on these markets.

We are on tenter hooks.

We of course have a shortened week, a holiday week as we anticipate Thanksgiving in the United States, and still anxiety bruise about which AI names to be holding onto into the end of the year or to be selling.

And video just turned to the red.

But I'm looking at the Nazak one hundred holding onto games more than two percent higher.

Broadcom charges higher, Alphabet does two Bitcoin, though not charging higher.

We got some reprieve over the weekend of course at Treys twenty four to seven, but we're still down one and a half percent.

Eighty six thousand is where we currently see.

We'll dive into bitcoin and crypto a little bit more in the show, but move on to the individual movers because a new record high.

Alphabet's up another five percent on the day, So much love for Gemini three.

Meanwhile, I'm seeing the socks doing well.

Broad Coms on the higher side.

In fact, a lot of the Magnificent seven names across the board of training higher Teza for example.

But want to shine to like one particular tech stop right now.

Amazon is in the green, but we're sticking really with documents.

More broadly in AI reviewing, as Bloomberg has that Amazon's data center footprint has been growing tremendously amid the AI boom.

One key to this is the use of co location facilities around the world.

This rented space to stash servers made up a fifth are the company's cloud capacity last year.

The person who's been going through all the documents, as Bloomberg's Matt Day who covers Amazon, Matt talk us through why this is pretty amazing.

Nine hundred data centers being own, managed, or indeed least or co leased by Amazon.

Most people know that Amazon's cloud business is enormous, but this kind of shows us exactly how enormous.

Right, Most cloud computing companies don't tell you exactly where their facilities are, and one thing they really don't talk about is where they rent space.

So these documents we reviewed, you know, as you said, it's about a fifth of aws's computing power as of last year was provided by co location facilities.

These things are all over the world.

There's hundreds and hundreds of them.

Just another way to underline how much both they've grown during the AI boom and just how wide their leaders in cloud computing.

Because Matt, we kind of think about Amazon, we think Virginia, We think enormous data centers that they own, that they operate, and that's the majority.

But why have they needed to build out these third parties, these co locations so much more so?

There's a couple of reasons.

I mean, one is when they set up shop in a new market, sometimes they're not confident enough in the ramp of demand that they want some options, right, go rent some space, you know.

Sometimes it's a speed to market thing.

You can expand faster and seeing a poor buy renting space and you can by developing or purchasing land and developing it yourself.

So it's really a way for them to get flexibility and the particularly internationally, which is where we understand most of their collos are.

It's a deep dive.

I urge people to go read it.

Matt Day, thanks for bringing us the latest on Amazon's build out when it comes to AI infrastructure.

But the AI buildout is meant that, in fact, big tech firms are taking on a lot of debt at the moment, but the sale of issuance, the scale of it might risk overwhelming buyers and it could weaken the credit market on both sides of the Atlantic.

That's according to analysts.

Let's debate all of that with j Hatfield, a CEO and CIO and Infrastructure Capital Advisors.

You actually own Amazon in one of your funds, and I'm interested more broadly about what you've thought about how companies are paying for the build up in AI data centers right now?

Jake, does it give you pause?

Well, I think there's one area where people are concerned, and that's because parts we've been saying for a while that there's no bubble in the market as a whole, but I do think there's bubbles in parts of the market.

Obviously crypto, but even with open Ai, they traded twenty five times revenue versus seven times for the mag eight and three times for the market, and that concerned about open and they have one point four trillion of obligations, so that concerned is leaking into other companies like Oracle, But generally most of the commitments are coming from the magate who have tremendous not just cash flow but free cash flow, are great businesses, so we're not overall worried.

And also I just point out it's not so much people think they're going to default.

It just applying man Oracles CBS is like one hundred and ten over, which is not that attractive even for investment grade.

So just that there has been a lot of issuance that means that you have to pay more to issue.

So I don't think it's a big credit concern, But there's an open issue about really whether open Ai, if you will, will really be able to beat out Google and other incumbents in the long run, and whether that's a little bit of a bubble.

We're looking at credit default swaps of Oracle right now, which have almost been used as a hedge.

To your point, many aren't thinking Oracles about the default, but there have been placed perhaps on watch negative by some of the big rating companies and people just thinking that this is a way in which you perhaps protect yourself to the downside.

I'm interested, Jay, therefore, on how we've seen Mazooho calling it out today saying that many have been shorting supplies to open Ai while buying into suppliers of Google for example.

How long can that tension last?

Well, we think it's probably that trades are getting a little bit tired.

You notice said Oracle is bouncing back, you know, the stalk with fifty percent higher or thirty three percent higher if you will, Yeah, fifty percent upside from here, just you know, three weeks ago, three four weeks ago.

So I think that trade's probably fully done.

Microsoft is getting getting smacked and is pretty cheap, so open Aye is not dead yet.

It's just that there's clearly competition to the retail side, so that I think is mostly priced in.

Also, keep in mind that we had normal market weakness after earning season, the market was fully valued.

We had a seven thousand target.

We were just shy of that.

Maggie was slightly overvalued by our models.

So some pullback and readjustment is normal this time of year, right after earning season.

I mean, the hundreds of millions of chutching PTUs as would definitely say that everyone AI is anything but dead.

But the anxiety, in many ways, this is built at the same time as we saw warriors in the market about not getting a rate cut in December.

How much is this is macro?

How much of this is actually specific to AI?

Well, you know, I would have said, actually incorrectly, I guess that the FED was not a big overhend hanging on the market.

But you did see Friday that the Williams comments, which are important the head of the New York FED is a permanent member of the FOMC.

His dubbish comments kind of turned everything around.

I think too much.

I think it's at best fifty to fifty we get a cut, but because of Williams, will at least get a dubvish pause.

And all that really matters is that we keep the tenure round four percent.

To keep the tenure round four you need the terminal rate to be about three.

You can track that on a terminal MIPR, and so as long as investors think there will be cuts, they don't have to be In December.

Jay, I want to ask you a question of out really and who is driving this market because has this sell off washed out some of the long only long term investors in the AI trade or has this been more quants, Has this been more retail, Has this been more short term investors that have seen some of the downside of Lake.

Well, it's absolutely blown up the momentum.

Short term traders, whether the institutional or retail, are funds, you know, like we hold Amazon and IICAP, they've actually been outperforming because they're more conservative.

We have few tech stocks there, but more dividend stocks, small caps of doing well like our s cap fund third stocks.

So we actually like these kind of markets because people have focused on cash flow and earnings and valuation typically outperform and they're really dumb stuff like crypto treasury companies that are no longer needed because we have ETFs get washed out.

So really healthy pull back with most of the really damage coming to the to the investors that don't pay attention to valuation.

I just want to go full circle HEREJ, because we end we started on Amazon, we end on Amazon.

I know you hold Amazon, and we just got breaking news that AWS is going to be building and deploying the first ever AI and high performance computing purpose built infrastructure for the US government new investment nearly one point th we giggaats they're talking about fifty billion dollars here J, Is that how you want to see Amazon committing to the AI trade?

Absolutely, we think that they are still the leader in the cloud service business.

But what we think is missed and why we're bullish on Amazon beyond just the normal EI trade, is that they have this gigantic retail business we all know, and they now have professional management that's working to make it adequately profitable.

So that's creating tremendous earnings growth away from the AI trade, and we think it's underappreciated.

You know, it includes advertising, which is really a cost offset.

So that's the biggest reason we're bullish on AWS and Amazon because they do have a little bit of a disadvance because they're an incumbent and everybody else is pouring money into cloud service business.

They have strong competitors there, but an underappreciated retail business with a lot of upside on profitability.

J Hatfield, I've structed Capital Advisors.

Great to have some time with you.

Wish you are very happy Thanksgiving And while coming up US commerce sextorly, Howard Utnick says the decision for in video chip sales to China, whether they're on President Trump's desk more on H two hundred's being debated.

Next.

Meanwhile, let's check in on what Ali Baba is up to.

Shares had been surging today the ADRs, in particular why well Quinn The app drew more than ten million downloads in the week after its relaunch.

This is all about its generator of AI offering as well.

From New York disciply by Tech.

Do you want to sell China some chips and keep them using our tech and our tech stack, or do you say to them, look, we're not going to sell you our best chips.

We just going to hold off on that and we're going to compete in the AI race ourselves.

So that is the question.

It's in front of the President.

He's going to decide.

It's a really really interesting question.

He's got all the information, he's got lots and lots of experts talking to him, and he's going to decide which way he wants to go forward.

US Commas Secretary Howard Ladings meeking of bluembog surveillance earlier today, as President Trump wighs whether or not to allow the sales of Nvidia AI chips to China, for all, Blue Vagazine and Tech editor Mike Sheppard joins us with the nuance that this is potentially H two hundreds that are being debated, more sophisticated than H twenties that already we understand they would allow to be sold with a fifteen percent cut.

But even that hasn't got legal sign off.

Well, that doesn't have legal sign off, and this falls short of the Blackwell design chips that have been bandied about just a few weeks ago as the President was prepared to meet with his Chinese counterpart, Hiesipang.

Ultimately that kind of a transaction never even came up in the conversations between the two leaders.

And yet the whole broader issue of whether Nvidia would be able to sell a more sophisticated version of its AI chips to China really hasn't gone away completely.

And we had our exclusive last week Cara that you saw showing that the President and his advisors are deliberating this question, and it appears that they are settled on whether or not to allow the H two hundred, which is of the Hopper design and still a very fast and very powerful AI chip.

If they allowed this sale, it would be a big change in US export control policy with respect to China and artificial intelligence.

The Trump administration and its predecessor of the Biden administration view China as the top us competitor in this area of artificial intelligence, and granting them China that is the technology to be able to advance in this race is a very sensitive question here in Washington.

Yeah, how does it break down on Hawk lines, on those in the administration and those around the administration, because there is this ongoing tussle as to whether or not in Video, which of course itself wants access to China, would just be allowing domestic competitors to brew if they're unable to sell.

Well, Kar, I'm glad you asked that, because that really is the debate right now, and Jensen Wang is very much at the center.

He has been arguing that, look, if we want to compete with China, globally in the race for artificial intelligence dominance, we need to be able to compete inside China too, and that means we will have to sell some of our technology in the Chinese market, which happens to be the world's largest market for semiconductors right now.

Now, that is an argument that is one some favorite inside the administration.

You heard during the interview this morning between our colleagues Lisa Bramowitz and Danny Berger and the Commerce Secretor, Howard Lutnik.

The Secretary articulated that himself that there is is attention and a debate.

There are others who are more hawkish on the national security side, though Caro, who view granting China any sort of access to this sophisticated technology simply paves the way for creating more risk for the US.

It would grant Beijing's authorities, including the military and intelligence apparatus, access to more sophisticated technology and artificial intelligence that they currently than they currently have right now, and it could allow for more surveillance and other uses in advanced weaponry that the US would just as soon not see happen.

Bloombags mac Shephard.

We appreciate you joining today, thank you so much.

Meanwhile, the President Trump is busy.

He's also escalating his attacks on the media, saying television networks shouldn't be allowed to expand.

Now in a post on truth Social Trump's side to concerns about the potential growth of left leaning news outlets.

This in response to a Newsmax report claiming that FEC Commissioner Brennan kar was moving to give TV networks great to reach to the proposed merger of Next and Tegna for multebricate HORTWN in this world of m and A has been most lucas sure, so called left leaning news outlets bearing the brund to the attacks.

But does this mean we're not going to see the m and A that we're anticipating in the industry right now?

Always hard to interpret what President Trump's posts on social media actually mean as it pertains the policy.

I mean, there's also those are different types of consolidation, right You've got the continued potential sale of Warner Brothers Discovery, where you have Comcast, which owns NBC, one of the networks that he talked about is a suitor.

You have Paramount, which owned CBS, which he exempted because I think he likes them as a potential suitor.

And then Netflix, which does an owner broadcast network, and then you've got the consolidation in the local television station space, which is what Brendan Carr has been calling for.

But Brendan Carr sees this almost as a check against the networks because the more power that the station owners have, they can actually potentially win in negotiations with the networks.

So I'm not really sure whose side he on here.

You assume that Brendan Carr is pushing the agenda that he is because Trump supports him, because that has generally been his MO.

But I guess we'll find out more as this sort of plays out in public.

Well, the big playing out that we're all watching and initial bids are in is for Warner Brothers.

Discovery, which owns CNN, is part of that.

Yeah, where do we stand.

I mean, you have a great piece out of the Weekend, as you always do in this one, really just showing how much Netflix is sort of bowing to potential changes in its own business model if it was to win.

Yeah, So Netflix, Comcast, and Paramount all submit bids on Wednesday, excuse me, Thursday, they've done a very good job of keeping the content of.

Those bids quiet.

We've tried to get some information others have as well.

I mean we know sort of the general framework, we just don't know the pricing.

Expectations are that the Warner Brothers Discovery Board will review those bids, or has reviewed those bids.

They'll go back to the three companies and say, you know, we need more here, we need less there.

And it is also so my understanding is still open.

So if someone else wanted to come in and make an offer, they are still available, They're still able to We're not in an exclusive period where someone else can't jump in yet.

We'll see how that continues to be picked away at by some of the key reporters.

Lukashaw will be strong among them, I'm certain.

So keep eyes on NIOS bids.

Quantum computing firm IONQ, well, it's just announced the partnership with Heaven Aerotech to develop quantum enabled drones as a move that will boost iron Qu's presence in national security sector.

Let's discuss this plan with IMQ CEO Nicolo de Massi.

So, why does quantum tech need to be introduced to drones?

Niccolo.

Well, it's part of our broader field actually of driving the quantum Internet and our full solutions of quantum computing, quantum networking and quantum sensing into every theater.

So we have.

Quantum sensors that work on submarines for inertial navigation and on ships on the top of the ocean.

We of course have quantum networks in quantum computers on the land, and we're building quantum economies in various jurisdictions and states around the world.

And of course we've also got our satellite signals intelligence business up in space, and so drones were the missing piece of the four theaters.

Where we now have quantum networking, quantum computing, and quantum sensors in partnership with Heaven up in the air.

What will it help Heaven do?

And why are you going with Heaven when it's still undergoing field evaluation with the US military.

Well, look, it's a partnership that is fantastically pioneering given the range of their drones, their hydrogen powered.

Obviously this doesn't prohibit us from broadening out our engagement with the drone ecosystem.

At the same time, you know, they're very tech forward as an organization, and so we love the fact that they want to pioneer with us quantum networking communications between drones in their fleet.

They want to work with us on our quantum computers to help, you know, not only coordinate their fleet, but also enact surveillance and early signal detection using our computers in conjunction with satellite imagery that we can provide, plus of course imagery that they can provide.

And then, last but not least, of course, they're interested in embedding our quantum sensors and positioning, navigation and time advances and technologies into their drone platform.

So you know, where there's a will is a way, right, And the reality is we consider ourselves to be a pioneering company.

Thirty years making we have led every aspect of quantum computing and quantum networking and quantum sensing for thirty years.

We're the first public company in the space, the first machines that turned on, the first machines on the public cloud, and today we're extending that capability to another theater, which we find tremendously exciting.

There, of course, pioneering and hydrogen.

You're saying you're pioneering by being first public company really focused on quantum, What actually are you doing for your partners right now, Niclo.

Many understand the promise of quantum, but you say you're in the field with RQ FOURTE, with Q four D Enterprise, you're already working with AWS with AstraZeneca and video.

You sort of say you're achieving twenty x performance results, performance results of what.

Yeah, So the Astrosenic in partnership that you're referring to is I think the most powerful example of what we call quantum advantage that's ever been generated in history.

And so I qus proud of the fact that we have pioneered every aspect of the quantum revolution, both commercially.

In the lab, we're the first company to achieve what's called four nines of fidelity ninety nine point nine to nine percent fidelity, which means that our cubits are the best in the world and the highest quality and are the most powerful.

And so the twenty x speed up is turning almost a month of classical computation using a GPU data center into just a day and a half.

And in fact, if you double click on that outcome, we actually have portions of the problem that we sped up by six hundred and fifty six times.

The classical portions of the workflow obviously kind of bring down the average, but nevertheless, it's a tremendous example of what we're achieving in the pharmaceutical the health tech space, if you will, using our Forte enterprise systems.

Now, our new computer that we just announced two months ago in September twelve, Tempo is two hundred and sixty million times more powerful than Forte, and so you can imagine that we'll be turning not just a month of computation into a day and a half, but we aspire to turn a year of classical computation in a day and a half on our newest machine.

We've only got a minute left.

But you talk about how you were the first really pioneering into the public markets, Nicolo, public markets are full of anxiety right now.

I just shine a light on your own share price, which I think is down about forty seven percent from its high that we had up in October.

How is that role riding that roller coaster?

Briefly, well, look, when I say pioneering, it wasn't against the public markets.

We actually invented the quantum computing category back in ninety five when we demonstrated the world's first cubic gate at the University of Maryland, and we've pioneered every milestone since then, both in the lab and commercially.

So being a public company we consider to be an actual part of our revolution.

You know, we raised three billion dollars between July and October, and it's you know, honestly been part of establishing the sector or communications opportunities around the world and ultimately credibility that enables us to drive both government traction and private sector commercial traction.

So we're catch Nikolos.

I have to leave it there.

Nicolo Demassi, thank you.

Welcome back to Blue meg Tech.

Let's tech equip check on these markets, because look, we're hired.

In fact, we are having the best day on the NASTET one hundred since May twenty twenty five.

We're up two point three percent.

Such is the volatility in the market right now.

Good and Video currently up one point seven percent.

Earlier in the moments in the show, it was in the red, so we really see some anxiety in the marketers we head towards holiday shortened week.

Bitcoin oh still in that anxious moment, we're off by nine ten percent eighty seven thousand, but steadier than where we were trading over the course of the weekend.

So let's break down what is causing some of the sell off in these momentum trades, whether it's crypto, whether it stocks bitcoin.

Bloomberg crypto reporter Emily Nicole joins us Emily, Look, we have had a wash out when it comes to ETF flows.

When it comes to more broadly some of the money, the fast money that was in bitcoin.

Are we seeing some sort of studying.

We're definitely seeing a bit of recovery.

I mean, it went as low as eighty five hundred odd on Friday, so going back up to about eighty seven thousand today, that seems like a pretty good recovery for bitcoin.

On the ETF front, We're not really going to know the data until the end of the day, that's all.

We might see more of the institutional activity coming in, but definitely those who trade over the weekend, those are the retail traders predominantly.

We're definitely seeing a bit more confidence coming back to the market.

I mean, the key number for everyone to be focusing on is that this is the worst month on track for the worst month since the FTX crisis, since twenty twenty two, does it feel like that in the anxiety in the market right now, It.

Definitely feels very unstable.

You know, like when everything was happening in twenty twenty two, there were clear catalysts for why everything was down.

We had strings of bankruptcies, fraud scandals, you name it.

This time around, there isn't really that kind of catalyst.

We've seen some kind of weakness in the crypto market with the mass liquidations that were happening in early October.

That means that liquidity is kind of down, so you would expect some more volatility in bitcoin.

And then we've also had you know, that's like companies like Strategy that acquire lots of cryptocurrency and use that to propel their prices upwards.

Lots of those have been launching into the market and not doing very well.

And so there are various kind of things that you can point to, you know, even the instability and tech stocks in the last week, that you can point to and say, maybe that's why bitcoin's having this moment.

But because there's no clear catalyst, no clear sign of why something's so unstable, nobody can really point to why it's having such a down month.

Is it also because we're at the end of the year.

I always think of tax loss harvesting in many ways must be in the eye of focus for a lot of crypto investors.

There's always that potential.

You know, people are still kind of uncertain as to how to even do tax with bitcoin.

I think not everybody is as clear as how how crypto assets are valued, particularly around the world.

It differs depending on the country you're in, so there could be some of that going on.

That's not to say though, that this is not really an ideal time to be selling your bitcoin.

It was, you know, over one hundred thousand only only earlier this year, So if you were looking at selling and taking a profit, I guess eighty thousand isn't really the value you wanted to be selling at.

Emily Nicole, great breakdown, Thank you very much.

Indeed on all things bitcoin.

Look, let's stick with crypto more broadly though, because special purpose acquisition companies, you know, the muss facts they've made a comeback and then now latching onto guess what crypto treasury companies such as the Strategy As we're hearing Emily Nicole discuss it's all about emerging tech as well as quantum computing.

It seems as though when amendmentum trait is really there, but research is a warning that many every day investors betting on these types of companies allowable to lose money.

Bloombag's Bailey Lipshals is here for all things momentum.

So SPACs they're back, but the mean sort of getting into the world of crypto treasury companies too.

Why are they seemingly a match made in heaven or hell, well, it's a.

Match made in heaven because to your point, momentum, so things that are trendy are where we've seen SPACs flock to think back to Spack one point zero or two point zero, depending how long you've been following the industry.

Eves, we saw Nicol Logo Public, we saw draft Kings when sports betting was starting to pick up steam.

So as we see the transition, as we saw a rush of companies, whether it was reverse mergers over the summer, creating digital asset treasuries or now SPACs, it really is kind of latching onto the latest theme.

And then we've seen that parlayer turn into quantum just given that the majority of companies that are already publicly listed were quantum de SPACs back in twenty twenty and twenty twenty one.

Some people very close to administration are losing a lot of money in that.

It felt like a lot of the sons were out there talking about these digital asset treasury companies.

Are they hurting?

Are they underwater?

Well, they're hurting is really when you look at the whole pitch of dats over the summer, was we can traded a premium to the actual cryptocurrencies we're holding and will continue to sell shares or convertible debt to fund that.

Well, those premiums are evaporating.

A number of these companies are trading below that net asset value.

So the big question is if the whole market is propped up by companies selling shares or converts to buy cryptocurrencies, Well, when we enter a bear market, what happens next?

And we're seeing a lot of this kind of falling down quite a bit.

Now you've got a wonderful story where you quote Peter Atwater, founder of Financial Insights, and he says all of these spacks getting involved in crypto asset treasury companies in particular, it looks like a a ta Ducan.

Ducan, I would call it a bird and a bird and a bird.

Here is a bird and a bird and a bird.

Why is he saying this is what it feels like?

So Traducans historically are are chicken stuffed and duck stucked in turkey.

So if you look at the graphic, the crypto is the chicken stuffed in the duck, which is the treasury company, which then gets stuffed sicious.

I've never had one.

Supposedly they're awesome if they're done well.

But the comparison from Peter it seems pretty spot on because you're taking kind of a concept, if you will, with cryptocurrencies.

You're putting it into a dats, which were all the rage, and then it's like, okay, well why don't we marry those with SPACs?

And we saw that and are continuing to see that play out.

We'll see if it cooks well or not.

You can take this analogy from many a place by any Lipschualt's ahead of Thanksgiving, we needed that kind of story.

Meanwhile, coming up, Lily Lyman from Underscore VC joins us to discuss how AI can drastically impact discoveries in science and healthcare.

That's next.

This is Blue Beg Tech.

We've been talking all day, all weeks about the concerns around the amount debt that firms are taking on in support of the data center build out.

So there's another d that could throw a wrench in the AI boom.

Depreciation putting Bagsdina maass you cover as AI Infrastructure has been writing about the life span of aigpus and bringing bout BusinessWeek You join us now.

Michael Burr has been talking about it.

Other player has been talking about it.

Should we have anxiety about depreciation of mgpus dita, So it's very hard to say.

We're going to talk a little bit more about accounting one on one here.

So when you buy a lot of physical assets, a company has to decide what the useful life span of those assets is and write it down over the course of that time period.

It's called depreciation GPUs, which companies like Meta, like Google, like Microsoft, like open Ai are spending tens of billions of dollars on them.

We really only have a couple of years of useful data for how long the current generations of those will last and so most of the companies are saying are writing them down over the course of five to six years.

But there's real concern.

Because, as we all know in Nvidia is committed to putting out new ones annually and is sort of trying to obsolete its own product.

So there's a real concern about what happens to those how long can they be used?

If you're writing them down over too long a period of time, you might be artificially boosting your profits.

What was interesting was in in VideA earnings they said, look a one hundreds which have actually been officially discontinued, they're still up and running.

They're still working and efficiently.

So so they were trying to sort of put some calm amid this anxiety.

You've got a great quote coming from Sarah fry the CFO of open Ai, of course, who'd been talking about how they're structuring their GPU depreciation.

Sure, so Sarah Friar said to us, look, you know, on the one hand, we don't really know is it four years, is it six years?

But what open Ai has seen is that they feel good that it's at least five and the reason is that they know that they're still using their A one hundreds, and the basic idea for you know, companies like open ai is use the latest chips, the nvideo Blackwells for things like the very high end training of the absolute top of the line frontier models.

The older chips can still be very useful for things like inference, so running the actual models.

And so that's the way that they think that this all works.

But that all requires, you know, the data centers to be what everyone's been calling Satanadel has been calling fungible.

So it means you can switch what the data center does from from training to inference.

You can switch from one customer to the next.

So when a customer rolls off and a chip is a little older, can you find a new.

Customer take that older chip.

That's a lot of the question around, you know, quote unquote how fungible these data centers are.

Well, look, cooleyve was fungible from being a bitcoin minor with its GPUs to them being an AI company, and many of these neo clouds have pivoted in that way.

Jan And lastly, we're looking at I've looked at KKR for example.

They're talking about potential froth and AI investment more broadly, and they're sort of trying to understand how the end user is using their data centers, but really who is on the hook for all of it?

They're trying to say, Look, data center owners, operators, often it's going to be the Lisa who is guaranteed long term payment?

Do we know who really has to hold the baby here and the bust?

I keep asking people the same question, you know, when the music stops, who doesn't have a chair?

Because as you mentioned about about debt, there's been you know, large amounts of debt contracts, you know, financing.

Of these GPUs.

And if the GPUs are useful for less time than we think, what are the people that you know are holding debt on them do do they ask for more collateral?

Do they?

You know?

How does this all go?

And you know people that we spoke to dead say that regulators and investors have to think about how far the quote contagion is going to spread if this all, you know, sort of comes home to roost at once.

Dana Bass on the optimistic side, we appreciate it, lovely to have you in town amid this Thanksgiving holiday.

With appreciate it.

Meanwhile, markets, look they're trying to weigh the risk of depreciation on one side, but there's also the hope, the hope that AI will pay off, particularly say in life sciences and healthcare discoveries.

Already, major AI pays like Anthropic have stepped into this area with models aimed at boosting research and development.

Now investors see an opportunity too.

Lelyman is managing partner over Unschool VC as a Boston based early stage investor in startups like Tetrascience, h one Quilt Health in New York, not Boston.

You really think Boston, though, is going to potentially be a winning trade when you think about the confluence of what's going to win out if healthcare is supercharged by AI.

Well, Caroline, thanks so much for having me here in the studio.

It's great to be back and look, as investors are always looking for a clearer why now in a market opportunity, and we are certainly seeing a signs of transformation in life sciences and AI.

What's changed is that we now have the data, we have the sophistication of the models, that we have real industry pull to unlock this potential, and what it could do is unlocked four trillion dollars worth of value across life sciences and healthcare.

What's changed is that biology is no longer just a wet lab discipline.

It is now a data and information industry.

Many people are calling it tech bio, and we had Underscore as preceed and seed investors and particularly based in Boston are incredibly excited about this because it's opened up a whole new world of software investing opportunities in the world of science.

Can I go to that four trillion number?

Yeah, what's that pegtopon?

What is it that we're seeing that will be fueled and to goner four trillion dollars of worth?

Well, if you think about what the life science and the combination of life sciences and actually honestly all of scientific data and healthcare, it's across the gamut of how this gets done today.

I mean today it takes two to three billion dollars per drug and decades to develop these therapies.

Think about if that can get cost you know, if that can get changed to be a fraction of the cost and a fraction of the time.

The economic and the human impact of that is absolutely enormous.

So the opportunity we see is across the entire value chain in life sciences.

So whether it's research and discovery, whether it's in preclinical and clinical trials, and services, manufacturing, development, and deployment.

You put all that together and it's not hard to see how there could be a four trillion dollar opportunity coming out of this.

And you said, you're seeing signs.

What all the signs on what all the software companies that are leveraging those signs.

We're seeing signs across all the different players in the market.

So the major pharma companies are certainly making moves in this space.

They are under enormous pressures.

I mean, the cost of R and D is rising.

It basically doubles every nine years.

They are facing issues with their margins.

They're facing a potential two hundred and sixty billion dollar revenue cliff as some of their patents expired, and so that's creating the market poll.

For AI solutions.

They are partnering with often many times startup companies.

So for example, Taketa just launched their partnership with Tetrascience, which is a company we're invested in.

Think of Tetrascience like the snowflake specifically for scientific data and what it's doing is it's partnering with all the major technology players in Vidia, Google, Microsoft, Data Bricks, Snowflake and rallying the tech stack around this opportunity to unlock scientific data so it can actually be used by models.

And so in this one, what they're able to do is working with Deicata on hundreds of use cases so AI can sit on top and use this data and it's driving ninety percent faster workflows, forty percent increase in productivity.

So we're seeing that type of adoption in partnership across the major pharma players and startups.

How does a photo company compete with an anthropic who's getting into a similar space.

People always love to ask that question, how do how do startups compete with the incumbents?

And I always think that, yes, incumbents have the advantage of data and distribution, but startups have the advantage of focus and speed.

And so we're seeing those opportunities across the board.

I mean, there's a company we're invested in called Terraflow, which is automating the analysis and data around flow cytometry, and again I mentioned Tetrascience.

You know, these are opportunities that require very specific domain focus very specific types of people who can do it, and the ability to build in an AI native way from the ground up.

The nthropics of the world.

Open AI is also launched in this space.

They also are going to need to do the practical implementation and so they're going to need partners along the way to do it.

So I think it's not a zero sum game.

I think there's an opportunity for collaboration, Sony, you think so.

Lillly Lyman is over in New York for a short while.

We appreciate her coming into the studio.

Managing partner at Underscore VC online travel and experience booking company Peak, it is doubling down on AI.

It's acquiring ACME Ticketing and Connect and Go and the move Physician's Peak to expand its reach across museums, theme parks, tours and other attractions.

The company also raised additional seventy million dollars in funding.

Here to talk it all through is Peak c Rizwana Busche.

So you call yourself the Shop of five Experiences, explain what that is basically with the operating system that works with museum, tours and activities providers, and we provide all of the tooling they need to run their business, so online booking and payments, everything that you do on site as you're checking in all the way through to marketing, business analytics, collecting reviews.

We really are that end to end backbone for everything that a business needs to operate, and that backbone is solidified by your M and A.

So told to us a little bit what ACME brings to the equation or connecting GO.

How are they fueling the growth?

Absolutely, so you know what we saw off the last couple of years.

We really got to know these businesses and they've done incredible jobs in working for very specific verticals and so as an example, you know, ACME has built incredible infrastructure and ticketing for museums and iconic cultural attractions.

Think about that is here in New York, things like the MoMA, the Whitney Museum, the Fret Collection.

So that includes memberships and donation management, and so they've done a fantastic job there.

That's something that we can incorporate into everything that we're doing at peak and Connecting GO really double down on theme paks, on water parks, and so that means that RFID technology that you've probably used when you've taken.

Your kids in a water partners we can for my sins exactly, so you've used that.

So they've done a great job on that technology, alongside a lot of things around online sorry online and on site guest services, things like F and B and so, you know, bringing these three companies together, we get a huge advantage by being able to have a lot of synergies as well as being able to you know, take all of the best features and cross pollinate them across the platforms.

And the last piece, obviously, is just that we've been real innovators on the AI side, and so we're now in a position to take all of the things that we've learned and take them across.

The So what sort of innovations in AI really?

You know, last year we went and pulled our businesses and over eighty percent of them said we know, we really want to use AI, but only ten percent word using AI, and so it became very clear that for us to be able to assist those merchants, we actually needed to integrate AI tooling into our platform.

So examples of that have been first on revenue growth, which is obviously incredibly important to businesses.

We created AI Dynamic pricing tools, so that means we're incorporating things like weather or seasonality or frankly local demand.

You know, think Taylor Swift is coming to town.

And what we were able to do with that was layer that into the pricing for the businesses to increase revenues by about five to twenty percent, so massive impact on revenue growth.

Another area that we've really done a lat on AI has been around automating operations.

As you can imagine the businesses we work with, they have a lot of manual, you know, back end operational tasks.

You know, Bryant Park ice skating here in New York very popular this time of year.

They have lots of people trying to reschedule, so they're spending thousands of hours on you know, these manual tasks.

So we were able to automate all of that work and in doing so save them, you know, thousands of hours of time as well as millions in costs.

And I think the last thing has really just been that there's a shifting consumer demand landscape.

We all know that over the last few years, people have been moving towards things like TikTok for the video content.

You know, over half of consumers say that they're inspired to book experiences based on what influencers think, and yet the businesses we partnered with didn't have a way to be able to meet that demand.

And so, you know, we created influencer marketing tools.

With a click of a button, they were able to reach hundreds of thousands of potential travelers.

And so in doing that, what we're really allowing our operators to do is focus on what they're really good at, which is delivering an incredible customer experience while taking care of what is a huge shift in the industry.

But that shift comes with costly talent.

You've just raised seventy million dollars.

Is that what that's for is about beefing up your own tech talent to be able to bring more general to AI offerings to bear.

Is it about more acquisitions?

Where does that fund of get put to work?

It's absolutely it's about us consolidating all of the all of the platforms as well as really layering in more AI.

So think about you know, the things we've already done to automate operations.

You know, we've now got hundreds of agents working behind the scenes twenty four to seven to do everything that the merchant needs.

And so you know, what we're really doing is doubling down on innovation, and so that means tech talent, and it means also, you know, an opportunity for us to double down on sales.

You know, one of the things that we've saw with the acquisitions is that although Acimmune Connecting Go have fantastic customers, they've actually done very little on the sales site.

So we want to bring those tools to market.

So, you know, AI plus sales allows us really to get our tools into the hands of many more businesses and.

A few more experiences for all of us out there this Thanksgiving and holiday season.

Raswanna Basher coming on talking about the M and A and the fundraiser peak.

We appreciate it now, that does it.

But this edition of Bloomberg's Heck, do not forget to check out our podcast find on on the Terminal so well as on Oline, on Apple, Spotify, and iHeart from New York.

This is pretty bag tack.

Mm hmm.