Bloomberg Businessweek Weekend - October 3rd, 2025

22:46And as you said earlier, we're looking to put up 45 to 60 by the end of next year. And so this capability is very important in the United States, but also around the world.

22:55Carol Massar:Well, tell us who you anticipate or who are right now your biggest customers. I'm curious about commercial, residential, and I'm also curious about government. it. Oh, that's right. And the important thing about our company, too, is, you know, space has historically been a bit of a niche. You know, if you live in a rural area, or if you're on a plane and you want connectivity, there are nice little markets there. But this is about going to the mass market, the 6 billion mobile phones in the world. And so that's that goes for people who live, work and travel go in and out of coverage who have greater ability to pay and want that convenience, as well as people who live perhaps in rural areas who don't have good connectivity, who are willing to pay a little bit more a month to have cellular broadband.

23:38Again, this is not a text service. This is a cellular broadband service that we'll be selling. So that's our U.S. and really developed economy story. When you go around the world, there's many countries, though, where there's over 2 billion people today who don't have good 3G or better service on their phones. That means 2G or nothing. And so market by market, our service is valuable to the users and the operators who support those end users. And then you mentioned U.S. government. That's been a relatively new add to our story in the last two years. But given the defense and space backdrop in the United States, this is something that's been front and center for us for the last two years, and we're already providing services to the U.S.

24:20government from orbit.

24:21Carol Massar:So, Scott, you probably know this little company called SpaceX that is out there. And I'm just curious. They did a deal with EchoStar. They became the first company to amass control of the satellite constellations in outer space, the launch infrastructures to deliver them there, and the potential for direct connections with mobile devices on the ground. So there's SpaceX. They're kind of the big behemoth there, the big player. There's you guys. There's Amazon.com. There's Global Star in the race for ubiquitous coverage. How do you plan to compete with Starlink, which already has thousands of satellites in orbit?

24:56Right. Right. And I think for the layman, it's important to distinguish between service to a dish that you might put on your house or on a car or on a plane and then the phone in your pocket. Right. We all have Wi-Fi at home and then we have a cell phone for when we're on the go. So this is a market, the cellular market from space, that's that's brand new. You've seen some players start to enter it, including Apple and Starlink. But we've been at this for about eight years. This solution is tailor made, purpose built for this solution. This is not an add on new service for us. This is all we do.

25:27And that's why we've been able to garner such incredible support from network operators globally, like AT &T and Verizon in the U.S., Vodafone in Europe, Rakuten Mobile in Japan, Bell Canada, who we just announced cellular broadband testing from Canada today with, who's also an investor in us. So these are capabilities that have been developed with the network operator in mind. We are focused on making their network better so that they can deliver the value to the customer.

25:54Carol Massar:Are you not saying that you're competing with SpaceX and Starlink, that you're completely different businesses? Well, we plan to go after the cellular user through the mobile network operator. They also have a strategy, as you said, that they're pursuing. But this is a market that we think is big. It's going to be worth tens of billions of dollars. There's six billion phones out of there, out in the world that go in and out of coverage. And all of us know that feeling when we don't have a signal, it's you're helpless. And so we think that, and all of our over 50 network operator partners think, that this is something that really enhances the value of the cellular plan that almost all of us have, certainly in the United States.

26:33And so that is a strategy that's good. That's going to be a nice, robust market. And we expect with our technology to be the leader in that because we're doing broadband from space. You mentioned your work with the U.S. government over the last two years. Can you expand on that a little bit? What exactly are you doing for the U.S. government? Yeah, so it's probably worth taking a step back. We currently operate the five largest satellites in low Earth orbit commercially. That low Earth orbit for the layman is, that's where the space station is. It's much closer to the planet. It's that lag you experience when you have a geosynchronous satellite.

27:06LEO solves all that. So we have the largest satellites deployed in low Earth orbit. The one we're shipping to the launch pad in two weeks is three times the size, over 2 ,400 square feet. So this is a unique technology that was developed to talk to the small phone and to do it well and to navigate crowded cellular airwaves. But it also has other applications. So with our U.S. government business, we see up to 10 different use cases, both communications and non-communications, that can support the U.S. government mission for defense. And importantly, one of the ones we're testing in orbit today, and we've been doing it for over a year, has really strategic and valuable implications, including potentially for the Golden Dome project.

27:49You also mentioned the notion that it's not just texting and being able to make calls. This is broadband delivered from a satellite to wherever you are in the world. That's the idea here. What is the experience using the phone in that environment and how could that be different or similar than using a 5G LTE network? What are the speeds we're talking here? That's right. From the beginning, and again, this is why we've been partnered with the network operators. They've been in the room with us testing and developing this tech for five plus years. What it means is we're integrated on the back end.

28:21You remember everyone's got a vision in their mind of calls in the old days where someone would be connecting the call and doing this. Well, that technology still exists in the world. It's just done with servers and with software. We're deeply integrated on that side of the business so that the phone just works. This is a native cellular broadband experience. The user doesn't know that there's a difference unless we want them to. And they can do text, calling, native calling, video, streaming, and they can do all these applications. And it feels just like you're using your phone on an LTE and 5G network.

28:54So how fast? Like what are we talking megabits per second here? Up and down. So we've tested over 20 megabits per second to the cell in the past couple of years with our satellites in orbit with the uh you know there was mention of a spectrum deal a moment ago we did our own spectrum uh transaction earlier this year uh very similar type of spectrum which is about 40 plus megahertz in the united states and with 40 megahertz we can deliver 120 megabits to the cell on the ground now how you manage all the network traffic and how do you go to market is is a critical decision we make with our partners around the world including in the united states but there's only one way to get broadband capabilities from space, and that's with a big satellite, and we have the biggest.

29:35On the connection side of things, we're wondering, too, about the experience of being inside and outside. Anyone who's used a Garmin head unit, for example, on a bike knows that you have to use it outside to get the cell signal. Can this coverage go inside buildings? That's right. We can do one wall in. Some of the success factors for that are the fact that, again, we have a big satellite, and we also use low-band spectrum. That's part of our partnership with AT &T and Verizon is combining some low band spectrum that they have from decades ago. And so the low band spectrum propagation characteristics are the best.

30:06And as you go into mid band, even then it's still pretty good. So we can do about one wall in, which means a building, means a car, means a plane.

30:14Carol Massar:Ah, okay. That's what we were. Cause I think there were some folks like kind of messaging. What is he talking about? Hey, you mentioned that you guys have picked up spectrum, 40 megahertz. Do you want to buy any more if some comes up for auction? Well, in the space world, there's two big bands of spectrum that matter. It's called L and S. We just purchased long-term access to the L band in the United States and Canada earlier this year. And that gives us a big chunk of spectrum, the biggest available and the most valuable wireless market in the world, which is the US. We also purchased an international filing that allows us to go around the world and pick up other pieces of spectrum for space.

30:53So we're pretty happy with our spectrum position now for those two moves. This, again, is consistent with our historical strategy of sharing cellular spectrum with the operators, but it gives us more lanes of traffic and the ability to do better services to more subscribers. So we like our strategy in both of those two bands that matter.

31:09Carol Massar:All right, we've got to run. So appreciate this deep dive. I hope you'll come back. Keep us abreast of what you guys are working on. That was Scott Wisniewski, president of AST Space Mobile. Still ahead on Bloomberg Businessweek, pharmaceutical stocks popping up this week on Actions by the White House. Pfizer is committing to offer all of their prescription medications to Medicaid. It will be at the most favored nation's prices. It's going to have a huge impact on bringing Medicaid costs down. And talk of cheaper drugs for Americans. That's next. This is Bloomberg. Seeing through the eyes of experts gives you a better view.

31:46Carol Massar:Another big IPO hits the market. Clearly, I've been screaming this is an elegant chart. And at Bloomberg, our market vision is 2020. Stocks just keep moving higher. There's still supply chain issues out there. The inflation debate continues. Bloomberg Radio. Context changes everything. Support for the show comes from public.com. If you're actively involved in your portfolio, you probably catch yourself repeating the same actions. Buying the dip, manually sweeping idle cash, putting on a hedge. On public, you can now create AI agents that handle all these tasks on your behalf. Just describe what you want to do in plain English.

32:21Carol Massar:Like, if the VIX hits 25, buy a put option on the S &P 500. Or, if my cash balance goes above$20 ,000, move the excess into my direct index. You approve of the workflow and your agent handles the rest. Monitoring the market, watching for your conditions, and executing your strategies exactly as defined. An investing platform driven by your intent, not just your clicks. You can also get full read and write access to your account via the public API. Go to public.com slash market and fund your account in five minutes or less. That's public.com slash market. Paid for by Public Investing. Brokered services by Open to the Public Investing, Inc., member FINRA and SIPC.

33:04Advisory services by Public Advisors, LLC, SEC Registered Advisor. Complete disclosures available at public.com slash disclosures. So there's a lot of noise about AI, but time's too tight for more promises. So let's talk about results. At IBM, we work with our employees to integrate technology right into the systems they need. Now, a global workforce of 300 ,000 can use AI to fill their HR questions, resolving 94 % of common questions. Not noise. Proof of how we can help companies get smarter by putting AI where it actually pays off. deep in the work that moves the business. Let's create smarter business.

33:41IBM. Wise is the smart way to manage the currencies you need around the globe. If you've ever sent money internationally using a traditional bank, there's a good chance you've paid more than you realized. Hidden fees, exchange rate markups, and extra charges can quietly add up before your money even arrives. There's a better way. Try Wise. Wise uses the exchange rate you'd usually find on Google, helping you avoid the unwelcome surprises that often come with international transfers. Whether you're sending money to family overseas, spending while on your holiday abroad, or paying bills across borders, Wise makes moving money simple, transparent, and straightforward.

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34:43Carol Massar:Let's talk about health care for a second. It doesn't always work the way people expect it to. If you've ever waited on a prescription refill or had a hard time getting the care you needed, you know the feeling. The system should just work better for everyone. That's exactly what the people at Optum are trying to do every day. They're a healthcare company linking patient care and pharmacy services and using data and technology to drive the whole system so care is connected, not complicated, for patients and providers. Things like making it easier to get care that looks at the whole person, from primary care doctors to mental health support and even in-home care, and then using technology to make sure they all work together.

35:22Carol Massar:Technology designed to help doctors spend less time on busy work and more time with their patients. And those prescriptions? Optum is working to bring costs down, save patients money, and make it easier to get refills. Little by little, Optum is helping make healthcare work as one for everyone. Head to business.optum.com to see how. The data that matters for your investments. Read on the screen for any energy stock out there. And analysis on the companies making news on Wall Street. I'm keeping an eye on Uber and Lyft. Amazon getting some love. Listen to the Stock Movers Report from Bloomberg.

35:57Nike shares are absolutely flying this morning. It's your short audio report on the day's winners and losers in the stock market.

36:04Carol Massar:Let's take a look at the sectors and how they perform. Subscribe to the Stock Movers Report on Apple Podcasts, Spotify, or wherever you listen. This is Bloomberg Business Week Daily with Carol Masser and Tim Stenevek on Bloomberg Radio and Television. Wall Street had long feared that President Trump would follow through with threats to impose aggressive drug pricing policies, eroding the pharmaceutical industry's profitability and depressing share prices. Those fears, though, largely laid to rest this week after Pfizer cut a deal with the White House, the company negotiating a three-year reprieve on drug import tariffs in exchange for a promise to reduce what it charges Medicaid.

36:43Here's Pfizer CEO Albert Bourla at the White House alongside President Trump. The big winner of this deal clearly will be the American patient.

36:52Carol Massar:There is no doubt about it. They are the ones that will see significant impact in their ability to buy medicines. But I would argue that it is not the only winner. I think who else is a winner here? It is American innovation and American economy. We're going to have another meeting next week on this. We have another great company coming in, similar kind of numbers. but we're going to show you some 1 ,000 % drops in prices. There has never been anything like this in the history of medicine. That was President Trump, you just heard, and Pfizer CEO Albert Borla. I just hope my high school math teacher is not listening about a 1 ,000 % drop.

37:32Carol Massar:Yeah, I know. Because we're not going to get into the math mathing there. Let's bring in Damien Garda. He's Bloomberg News health reporter. He's been very busy. He's taken some time to join us here in the Bloomberg Interactive Brokers Studio. Are drug prices going to go down as a result of this? For the vast majority of Americans, no, I sincerely doubt it. There is no reason to conclude that based on what we learned, at least yesterday, from Albert Bourla in the Oval Office and the promises that Pfizer has made. We can get into the nitty gritty, but I think the main thing, the promise to Medicaid, an important caveat there is that patients on Medicaid, Medicaid already pays the lowest price available in the United States.

38:12It is legally obligated to get that. So the notion that Pfizer making a commitment to lower that further would change the out-of-pocket costs for patients, I just don't think there's much there. And furthermore, in terms of Pfizer's business, only about 5 % of that business accounts for doing business with Medicaid. That's the word business probably too many times. And I think the main thing that should drive the reaction here is that in this announcement, Pfizer, which has a fiduciary duty to maximize its profits and to update shareholders on its guidance, did not update its guidance. The company said this thing that ostensibly means we're going to make less money, at least that's how the president characterized it, but didn't actually say we're going to make less money, which of course, legally they're required to do.

38:55I feel like that through line is maybe the lens, maybe not cynicism, but the lens of reality that people should look at these announcements. Well, look no further than the share price reaction.

39:03Carol Massar:I said, yes, sir. I'm like, why is this stock rallying? They're going to make less money. I had no, I just made no sense. Everybody's like, well, it's all about the tariff thing. And I'm like, and that is certainly a part of it. But I'm like, they're going to make less money. How can this be a good thing? Right. So I think the relief that you're seeing in the share price reaction is twofold, or maybe even threefold. One, it alleviates the threat that the Trump administration was really going to come down hard with an aggressive policy that would be on the books that would really constrain what drug companies could charge.

39:32Instead, we get this voluntary, relatively vague promise from Pfizer that is expected to set a template for the company's peers, Eli Lilly, Merck, etc. They will probably all have their day at the Oval Office to do a similar kind of dog and pony show. And then furthermore, what's established is that if you make those promises, you get a reprieve from tariffs, which is the other kind of overhang for the entire sector is this fear that the import of medicines from Europe would face levies of, the president has said, 100%, 200%. the notion that if you just go out there and say, we're going to follow what the administration wants on drug pricing, we get that alleviation.

40:05Carol Massar:Damien, just quickly, just to be fair, I mean, has Pfizer come back and said, this is going to impact us financially, or it's not going to impact? Have we gotten any clarification from the company on this? They have not. There hasn't been a follow-on filing with the SEC, kind of making clear they're restating any guidance. And furthermore, what they've said is that the terms of their agreement with the White House are confidential. So respectfully, we can only conclude what's been said publicly. Damien, sit tight. We're going to bring in Angie Frank. She's CEO of the private health company Calderos.

40:32The firm does drug discount management. It uses AI as well as communicating with different parties involved in the negotiating process to get consumers the best prices. She joins us from Wisconsin. Angie, I'll ask you the same question that I asked Damien because you're right in the middle of this drug pricing thing. Are drug prices going to come down as a result of what we saw at the White House yesterday?

40:53Carol Massar:I think what Damien said, there's some truth to that. I think at the end of the day, We won't all feel it immediately, but I do think drug prices are going to come down. I think the announcement yesterday is a big change to the system, and it is the first step in what I think will be multiple steps. We're certainly opening up more channels for patients to access their drugs at more affordable prices. And I think the underlying the Medicaid price that that states currently pay is going to come down based on Pfizer's announcement yesterday. Well, that's interesting. What would the mechanism for that be?

41:32Because that's what I found myself wondering even yesterday in the announcement, which, granted, was lacking key details for obvious reasons, is very new. But why would this kind of set in motion a snowball that would end with patients paying less at the pharmacy counter? Yeah.

41:47Carol Massar:Yeah. So I think, you know, if you look at the overall list prices starting to come down to an MFN like number and that opening up most favored nations. Yes, most favored nations, exactly. And that opening up more channels for patients to access their drugs at lower rates. I do think the direct model that the website that was also announced, which opens up a channel for patients to be purchasing directly at lower costs, could really have a ripple effect on the way benefits are offered and how employers and self-insured employers start constructing benefit plans that give their employees access to drugs, which may bypass other players in the system, the traditional players in the system, middlemen that have been making money off of drug pricing and discounts and rebate models that really didn't benefit patients directly.

42:45Carol Massar:So I think the new channels being opened up and the new price point at MAC's Most Favored Nation will over the longer term have a pretty significant impact. Nothing confuses me as much as like picking up a prescription and coupons and pharmacy benefits. And I don't know, it's just kind of crazy. Damien, the PBMs, the pharmacy benefit managers, they are being looked at closely, like another layer that drives up costs. And so that is certainly part of the narrative here. So does that potentially remove that in what we heard from the president and the CEO of Pfizer yesterday, but then throw in this Trump Rx, like, what role is that play?

43:23That we need to see play out. But I think through the eyes of Pfizer and certainly people in the pharmaceutical industry, there is an optimism and maybe a hope that the agreement announced, if in fact it's a template for other companies, will shift the White House's attention away from pharmaceutical manufacturers and toward the PBMs and the other middlemen that you mentioned. And I think to Angie's point, there is a potential that TrumpRx, this sort of direct-to-patient offering that we've heard about, there are arguments as to just how popular that might be. How many people who don't have insurance would be willing to pay out of pocket hundreds or even thousands of dollars a year for a medicine?

43:58Is that what TrumpRx would offer? Is it an insurance? Like, this is not covered by insurance? It would be a cash pay business. And so we assume that the majority of customers for it would be uninsured or underinsured because otherwise they could get the drugs much cheaper through their insurance carrier. But the opportunity, I realize we're getting kind of in the weeds here, the opportunity is if one of those direct offerings were selling instead to employers rather than patients themselves, then they would be truly bypassing the middlemen that exist. This is sort of the Mark Cuban model that he's advocating.

44:27Right. Plus plus drugs. Exactly. So if Trump, and I'm using my imagination here, this is not something anybody's announced. If TrumpRx, the website that has not yet launched but has been described, were to expand its aperture to include employers, then we could be talking about legitimate savings for all parties involved and a huge change to the way it's done now. Angie, come on back in here and talk a little bit about the innovation side of things, because Albert Bourla at the White House said it's not just the American patient who will be a big winner, but it would also be the American innovation and the American economy.

44:59Perhaps there are those out there who might say, OK, well, if companies, drug companies aren't able to make as much money from the drugs that they sell, R &D in this space might suffer. We know it's expensive to run the clinical trials and to do the R &D. What do you think it means for American innovation when it comes to pharmaceuticals?

45:16Carol Massar:Well, I think it was great. I agree with Albert on all points. I think it's great for America that we're moving manufacturing and that level of innovation, job creation, et cetera, to the U.S. When you simplify the supply chain and the pricing mechanisms for our current drug pricing model. When you simplify that today, there's that we lack so much transparency, and how prices are established and who gets which price. And to your point earlier, Carol, where you mentioned, you know, the coupons and the co pays and all these things are so confusing. They're confusing by by design, people are making a lot of money off of that confusion and that opacity.

46:02Carol Massar:When you simplify and drive more transparency, you have less waste in the system. And that waste will feed the top of the funnel. That will be dollars that can go directly to the top of the innovation funnel and enable manufacturers to continue to work on and innovate more drugs and more medication therapies that help patients with life-saving and life-changing conditions. So it takes$2.5 billion to bring a drug to market. So every dollar of waste compromises our ability to invest in more therapies. So I think it's going to have a tremendous impact over the long run. Angie, just got about a minute left.

46:42Carol Massar:I mean, just talk to us about what you do. It's a data engine. It's information. You have, it looks like a couple of different constituencies that you work with. But just give us an idea and what that tells you about kind of the drug industry and drug pricing industry, what you have been seeing. Yeah, we really have a technology platform where we ingest large volumes of data. We apply logic and rules around various pricing programs and discounts and rebates. And then we ensure price integrity, that the right price is going to the right set of patients and the right time for that particular therapy.

47:20Carol Massar:So we're really driving quite a bit of price integrity in the system. The constituents that we work with include both pharmaceutical manufacturers and providers. And we really believe fundamentally that ensuring that the providers and the manufacturers can work more closely, directly together benefits Americans, benefits patients, benefits innovate. Our thanks to Damien Garday, Bloomberg News health reporter, and Angie Franks, CEO of the private health company Calderos, which focuses on drug discount management. And that wraps up our first hour of the weekend edition of Bloomberg Business Week from Bloomberg Radio.

47:56Carol Massar:Coming up in the next 60 minutes, this past week was full of stories and news on the consumer tech gadget space. It all coming at us, from Amazon's device overhaul to take on Apple and also something on Peloton's price hike. To putting a ceramic ring on it, courtesy of Aura. And the thing Mark Gurman really wanted to talk about. Plus, meet the parents, foreign buyers and all cash consumers buying up luxury apartments in New York City. And how to cheat on looking your best. You will be shocked, literally. What you need to know about the Catalyst suit. This is Bloomberg Businessweek. I'm Carol Masser.

48:30And I'm Tim Stenevek. Stay with us. Today's top stories and global business headlines are coming up right now.

48:38Carol Massar:Support for the show comes from Public.com. If you're actively involved in your portfolio, you probably catch yourself repeating the same actions. buying the dip, manually sweeping idle cash, putting on a hedge. On public, you can now create AI agents that handle all these tasks on your behalf. Just describe what you want to do in plain English. Like, if the VIX hits 25, buy a put option on the S &P 500. Or, if my cash balance goes above$20 ,000, move the excess into my direct index. You approve of the workflow and your agent handles the rest. Monitoring the market, watching for your conditions, and executing your strategies exactly as defined.

49:16Carol Massar:An investing platform driven by your intent, not just your clicks. You can also get full read and write access to your account via the public API. Go to public.com slash market and fund your account in five minutes or less. That's public.com slash market. Paid for by Public Investing. Brokered services by Open to the Public Investing, Member FINRA and SIPC. Advisory services by Public Advisors, LLC, SEC Registered Advisor. Complete disclosures available at public.com slash disclosures. The thing about AI for business, it may not automatically fit the way your business works. At IBM, we've seen this firsthand.

49:56But by embedding AI across HR, IT, and procurement processes, we've reduced costs by millions, slash repetitive tasks, and freed thousands of hours for strategic work. Now we're helping companies get smarter by putting AI where it actually pays off, deep in the work that moves the business. Let's create smarter business, IBM. Wise is the smart way to manage the currencies you need around the globe. If you've ever sent money internationally using a traditional bank, there's a good chance you've paid more than you realized. Hidden fees, exchange rate markups, and extra charges can quietly add up before your money even arrives.

50:34There's a better way. Try Wise. Wise uses the exchange rate you'd usually find on Google, helping you avoid the unwelcome surprises that often come with international transfers. Whether you're sending money to family overseas, spending while on your holiday abroad, or paying bills across borders, Wise makes moving money simple, transparent, and straightforward. Wise offers 24-7 customer service and runs over 7 million daily checks to spot and stop fraud. And most transfers happen in under 20 seconds, which means your money arrives in less time than you've been listening to me. Join millions saving billions.

51:09Be smart. Get wise. Visit wise.com or download the wise app today. T's and C's apply.

51:19Carol Massar:Let's talk about healthcare for a second. It doesn't always work the way people expect it to. If you've ever waited on a prescription refill or had a hard time getting the care you needed, you know the feeling. The system should just work better for everyone. That's exactly what the people at Optum are trying to do every day. They're a healthcare company linking patient care and pharmacy services and using data and technology to drive the whole system so care is connected, not complicated, for patients and providers. Things like making it easier to get care that looks at the whole person, from primary care doctors to mental health support and even in-home care, and then using technology to make sure they all work together.

51:57Carol Massar:technology designed to help doctors spend less time on busy work and more time with their patients. And those prescriptions? Optum is working to bring costs down, save patients money, and make it easier to get refills. Little by little, Optum is helping make healthcare work as one for everyone. Head to business.optum.com to see how. This is Bloomberg Businessweek Daily, reporting from the magazine that helps global leaders stay ahead with insight on the people, companies, and trends shaping today's complex economy. Plus, global business, finance, and tech news as it happens. Bloomberg Business Week Daily with Carol Masser and Tim Stenevek on Bloomberg Radio.

52:43Carol Massar:Plenty ahead in our second hour of the weekend edition of Bloomberg Business Week, including thanks mom and dad for the apartment. Just one of the trends going on in the New York City real estate market. And you may look like a superhero wearing it, and it just might supercharge your muscles while doing so. Our own Chris Rauser takes the catalyst suit for a spin. First up, fall may be the time when the air gets cool and Starbucks tries to get you to buy the pumpkin spice latte. But it also means it's the time the consumer tech companies show off their latest wares ahead of the holiday shopping season.

53:15Carol Massar:And this year was no exception. With what you need to know on it all, we were joined by Bloomberg News Managing Editor for Global Consumer Tech, Mark Gurman, on the good, the bad, and what Mark says will be the it device of the holiday season. These are the Meta Ray-Ban displays. These are Meta's first display glasses. I haven't set them up yet. They just came into the office. These are the first mainstream smart glasses with a screen and a lens. We've talked about them significantly. And then it has what's called the neural wristband. You put this around your wrist and that allows you to track your finger movements and your motion in order to navigate the user interface of the glasses.

53:54So I'm actually really excited to diving in, really using them and eventually publishing my review. They're$800. They went on sale at some Ray-Ban and LensCrafter stores, Best Buy stores. So excited to dive into these. What's the learning curve using this, Mark? Do you have to be trained to use it? Do you have to do a demo to use it? Can you just use it out of the box? Is it going to be easy for consumers? Yeah, they think that you need this crazy demo. And so they're not letting anyone buy it who doesn't get the demo. I got the demo at Meta's headquarters. a few weeks ago, so they were pretty comfortable with me just getting one out of the box.

54:28There's probably going to be some sort of, they tell me, a video that plays on the glasses that, you know, when you first do the first boot, tells you how to use the thing. There's a little bit of a learning curve, 15, 20 minutes or so on the learning curve as well. And so it's going to take a little bit of time to get used to it if you're new to it, to get it up and running. But I think people will eventually like this technology. My hope is eventually it moves to a hand and eye tracking like setup. So you don't need the neural wristband, something similar to how the Vision Pro is operated. But definitely, I think this is a category that's going to take off.

55:04Carol Massar:Unbelievable. I know when you talked about this last time, I mean, kind of I think both of us were blown away and and looking at your video that was on the Bloomberg about how to use it. Learning curves. You know, there's these videos to kind of have, you know, we figure out how to use things. But when I think about learning curves, Peloton, I feel like is still on a learning curve. And the stock has swung. They're upping prices. Explain this to us. And is this the way forward for this company? So it's a mixed bag, right? The stock is down probably because of the changes in pricing. They hiked prices between a couple hundred bucks and 700 bucks on the high end, depending on which bikes or treadmills you're looking to purchase.

55:49They hiked subscriptions between a couple bucks and five bucks, depending on which subscription you're getting. So Wall Street doesn't like that because that's going to lead to regression, even more regression in terms of user numbers. It's going to lead to people leaving their subscriptions. It's going to lead to people maybe not wanting to buy the devices themselves because of the higher price points. And so, you know, Wall Street usually likes a price hike, but in terms of Peloton, they really seem to despise it. On the other side of the coin, I think the hardware that they rolled out today is extraordinarily impressive.

56:21This new CEO has been in the building for a little bit less than 10 months. Actually, I think maybe 10 months to the day today. And they've got five or six new hardware devices under the prior CEO who was there two and a half years or so. They did basically nothing in terms of new product launches or innovation. So I think they deserve a lot of credit for working overtime and really fast to get this new equipment out. And so we'll see what really happens with these user numbers based on these price increases, but clearly Wall Street is terrified. Okay, let's move on to another wearable in the Oura Ring, a$500 version of its smart ring.

56:55This one's ceramic. We should remind everyone a lot of this stuff coming out right now because this is the holiday season. This is when people do holiday shopping. We traditionally get a lot of new devices and gadgets out during this time, Mark. This new Aura ring, I was surprised that Aura has such a high valuation now. It raised money. Bloomberg News reported on this in recent weeks. What can you tell us about this ring and what it does for the business or could do for the business? I think it's going to do nothing for the business. This is absolutely the same ring that they launched, I think it was last October.

57:26It's the Aura Ring 4. It's just coming out in a new finish. That's$100 more expensive. So it's the ceramic finish. I have the ceramic blue one arriving at the office tomorrow. We're also looking forward to taking that for a spin as well to see if there is anything more meaningful about it. But this is just probably a marketing lever and maybe raise ASP slightly. $500 for a smart ring. Interesting price point. Let's see what happens. But ours is a really fantastic business. But the problem is that they're$10 billion in terms of the valuation right now. So they're too expensive to get acquired. right um and they're they're but they're not worth enough to be like some major hardware company uh but they're they're getting there they need more types of devices they need to expand beyond rings and to other types of hardware yeah i was gonna say when it comes to

58:14Carol Massar:things like this technology devices consumer tech mark i mean are we that easy you know you just put a different finish on and we're like yeah i'm gonna spend the money we're not that easy are we uh depends sometimes maybe i don't know we'll see i don't think people are going to buy the ceramic version i think it's going to be super niche uh i think people are more into the couple hundred dollar version the reason these are doing so well is because of like fsa hsa whatever accounts people are using that to buy these devices and then uh a lot of people maybe not a lot of people but some people have the amex platinum yes and the amex platinum they just did their big price increase and as part of that there's like a 200 annual aura ring credit on there now.

58:52Unfortunately, and they should change this, that doesn't work with the subscription. You have to pay like six or seven bucks a month to use an Aura or$70 a year. But the 200 a year you get from Amex, it's kind of a scam because you need to buy the new hardware. And Aura doesn't come out with new hardware every year. That's neither here nor there, but that might be driving some purchases too. Is this Aura? I mean, and you wrote the story just a couple of weeks ago about the multi-billion dollar valuation. Is this a hardware company or is it a software company? software as a service? Well, it's both.

59:25They would be fine if they didn't have this subscription, but it's really the subscription and the annual subscription in particular that I think is driving things. They always say hardware is hard. Hardware is very bad margin-wise. It's not a good business. But when you're able to put a software product on top of it that has a 90 % margin, you're in pretty good shape. This is why Apple shifted to services almost a decade ago now, because they knew that hardware sales were flatlining. They knew margins could potentially go down. They knew they would have to adjust prices. And the way to create recurring revenue is putting something on top that's necessary.

1:00:01And Aura and Whoop and some others have, Peloton, of course, is the poster child of this, have figured out this hardware plus software business model.

1:00:08Carol Massar:All right. Speaking of hardware, let's go to your story that's out about Amazon overhauling its devices to take on Apple in the AI era. What do we need to know? And what kind of stood out for you? They look really cool, I think. I think Panos, he's the SVP of hardware now at Amazon and Alexa and services, has done a really nice job on redesigning the hardware with the Echoes and the Echo shows. Three new Kindle scribes. These are Kindles that you can read on, but you can also write on and draw on. It's sort of like a scratch pad. I think they look terrific, and these are going to do pretty well.

1:00:39The new Color Scribe,$630, is the most expensive Kindle device ever. I think, actually, the most expensive device from Amazon since the failed Spirephone from a decade ago. I think it's going to do really well for me. I actually like this new mid-tier Kindle Scribe. It has a backlight. It looks like real, really nice, bright white paper, but obviously digital. So I might get one of those to do some reading. I need to go back to reading and maybe I'll get one of those for the holidays. Don't we all? I'll send you some books, Mark. In the meantime, just very briefly, we didn't get a chance to talk about the Nest branded hardware.

1:01:13Again, I said it would be sort of around the world with Mark Gurman in terms of tech devices. What do we need to know about Alphabet's lineup? So it's kind of whatever. The most interesting thing to me is they announced this$100 speaker, but it doesn't come out until the spring, which I guess is anywhere between March and the end of May. Why they released it so early or announced it so early before the release, only, I don't know, God knows. I guess they wanted to just tell a more cohesive story and try to get out in front of some of the Apple announcements coming up in the next several months.

1:01:45Moving to 2K video quality, I think that's good. Ring at Amazon the other day or yesterday, they announced 4K video. So it's kind of interesting that Amazon and Google are completely two different spectrums of video quality in the same week.

1:01:58Carol Massar:Hey, really quickly, 20, 30 seconds. What do you think is going to be the big, hot consumer tech item this holiday shopping season? Ooh, smart glasses. I think the Ray-Ban meta glasses, I think, are going to do pretty well. And of course, the iPhone 17 Pro has just been blockbuster for Apple. They can't make them fast enough. So this is really big stuff for Apple this year. Hey, we're speaking with Mark Gurman. He's Bloomberg News, managing editor for Global Consumer Tech. He joins us from Los Angeles. Mark, more on the H1B story. You know, we saw so many tech CEOs just a couple of weeks ago at the White House at that dinner.

1:02:31I was surprised to see a decision such as this from the president, given that it would affect the companies that these individuals run so negatively. Why don't you think we've heard a collective message from the tech community on the H-1B visa issue yet? Oh, I mean, Tim, you know the answer to that. It's because they're scared of Donald Trump and they don't want to push back on this H-1B visa issue only for Trump to hit back at them with tariffs or starting to charge Apple more tariffs than they're already paying today. Right. I think they are worried if they fight on this issue, they'll come back and be hit harder on other issues, maybe issues that they consider more fundamental to their lobbying efforts.

1:03:18You're not going to see Apple push back publicly against this H1B issue. They would have done so already. Instead, they're going to work with lobbyists and other groups behind the scenes to have them do their bidding for them. But you're not going to see them push back publicly. That's not going to happen. That was Mark Gurman, managing editor for Global Consumer Tech. After we spoke to Mark on Wednesday, he reported that Apple has hit pause on a planned overhaul to its Vision Pro headset to redirect resources toward a more urgent effort, developing smart glasses that can rival products from meta platforms.

1:03:51The smart glass war it is on. He loves these things from meta.

1:03:55Carol Massar:It's like, right, we talked about all these things when we had him join us. And he's like, wait, wait, you guys, I don't want to talk about any of this. Forget about everything. I want to talk about these glasses. Focus on these glasses. I mean, he told us this a couple of weeks ago when he was at their headquarters trying these for the first time. He said, these are game changing. He's the tough audience. And so when he's really into something, you really take notice. All right, everybody, you're listening to Bloomberg Businessweek. Coming up, thanks, Mom and Dad, for the apartment. And hey, thanks, everybody, for paying all cash for apartments.

1:04:20It's just one of the trends, or maybe a couple of the trends, happening in the NYC real estate market. This is Bloomberg.

1:04:42Carol Massar:Support for the show comes from public.com. If you're actively involved in your portfolio, you probably catch yourself repeating the same actions, buying the dip, manually sweeping idle cash, putting on a hedge. On public, you can now create AI agents that handle all these tasks on your behalf. Just describe what you want to do in plain English. Like, if the VIX hits 25, buy a put option on the S &P 500. Or, if my cash balance goes above$20 ,000, move the excess into my direct index. You approve of the workflow and your agent handles the rest. Monitoring the market, watching for your conditions, and executing your strategies exactly as defined.

1:05:21Carol Massar:An investing platform driven by your intent, not just your clicks. You can also get full read and write access to your account via the public API. Go to public.com slash market and fund your account in five minutes or less. That's public.com slash market. Paid for by Public Investing. Brokered services by Open to the Public Investing, Inc., member FINRA and SIPC. Advisory services by Public Advisors, LLC, SEC Registered Advisor. Complete disclosures available at public.com slash disclosures. So there's a lot of noise about AI, but time's too tight for more promises. So let's talk about results.

1:05:57At IBM, we work with our employees to integrate technology right into the systems they need. Now, a global workforce of 300 ,000 can use AI to fill their HR questions, resolving 94 % of common questions. Not noise. Proof of how we can help companies get smarter by putting AI where it actually pays off, deep in the work that moves the business. Let's create smarter business. IBM. Wise is the smart way to manage the currencies you need around the globe. If you've ever sent money internationally using a traditional bank, there's a good chance you've paid more than you realized. Hidden fees, exchange rate markups, and extra charges can quietly add up before your money even arrives.

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1:07:23Carol Massar:Let's talk about healthcare for a second. It doesn't always work the way people expect it to. If you've ever waited on a prescription refill or had a hard time getting the care you needed, you know the feeling. The system should just work better for everyone. That's exactly what the people at Optum are trying to do every day. They're a healthcare company linking patient care and pharmacy services and using data and technology to drive the whole system so care is connected, not complicated, for patients and providers. Things like making it easier to get care that looks at the whole person, from primary care doctors to mental health support and even in-home care, and then using technology to make sure they all work together.

1:08:02Carol Massar:Technology designed to help doctors spend less time on busy work and more time with their patients. And those prescriptions? Optum is working to bring costs down, save patients money, and make it easier to get refills. Little by little, Optum is helping make healthcare work as one for everyone. Head to business.optum.com to see how. This is Bloomberg Business Week Daily with Carol Masser and Tim Stenevek on Bloomberg Radio. Mortgage rates in the U.S. rose at the end of September for the first time since July, shifting direction after a steady string of declines. Now, even with that uptick, borrowing costs are still around their lowest levels in almost a year, creating opportunities for both house hunters and owners seeking to refinance.

1:08:46In Manhattan, home sales jumped to the highest level in more than two years as affluent buyers, armed with cash thanks to a boost from the stock boom and last year's rich Wall Street bonuses, forged ahead on deals. For an update on the New York City real estate picture, we recently checked in with Louise Phillips Forbes. She's a real estate broker with Brown Harris Stevens. She's been in the industry for more than three decades and has close to$6 billion in sales.

1:09:11Carol Massar:Look, my old motto is, you know, marry your home and date the rate. and brokers have that motto i mean wait marry the home and date the rate yes i mean i had my first mortgage guys my first mortgage was like 8.35 or something and i had it as low as 2.85 and you know so and i so i just think that yeah i think it's about getting educated in the buying power shifts and i always say certainly in the last 18 months i'm like listen guys it's okay to buy when interest rates are high if you can afford the the carry for a period of time you're you are paying less for the home than if it was lower but some people have been carrying that for like three years now and they thought okay well i can do this with like a seven-year arm and it'll rates will drop they haven't but they are and those individuals got much more home if they are inconvenienced listen i had a roommate when i bought my apartment first because to me it was about owning my home instead of renting.

1:10:16Carol Massar:So we make compromises and you don't go on that extra trip for if you, if you want to be in that school district for your kids. So those decisions were made and have been being made, but the market, you know, is definitely this fall is feeling there's an energy in it despite it being an election. Oh, you're about New York city, New York city, our market specifically. Yeah. Sorry. No. Um, I am curious though, So when it comes to activity, are there multiple bids still? Give us an idea. Give us some color around what's happening. Sectors, in some cases, yes. Like which sector? Yeah. Well, I think that the one-bedroom market, I mean, listen, I did a development project that I converted, and I've got a couple left at 393 West End Avenue.

1:11:00Carol Massar:A 792-square-foot one-bedroom just rented for$7 ,000. dollars. So if you can own, try to own. So the one bedroom market has seen, especially if you have low carrying costs, they are seeing multiple bids. Anything under two million is also very efficient if it's priced right. If you're not priced right, it's not happening. And the market is very knowledgeable and observant, meaning buyers. What about the higher end? What are you seeing with foreign buyers? We love to talk to you about where those buyers are coming from if they're back it depends on what country but they are they've doubled in the last year we had what level um i think that the low the lower end we don't have the oligarchs necessarily but but you have people who are looking for the future and want to pull money out of their government or their country where are they coming from uh mexico um Ukraine.

1:12:05Carol Massar:We've seen, for myself, a lot from Korea and a lot from China. So, okay. So we love to talk, obviously, real estate, but also politics and how it plays in. So give us an idea, because that's interesting in terms of foreign buying. Have you noticed an uptick? In terms of the political winds, how... Well, I think I have somebody trying to purchase a piece of property from me who basically says, I'm concerned about the mayor, and they're trying to buy from Jakarta. And I'm like, how much, you know, like, were you here when de Blasio was here? Were you here when, you know, we've lived through difficult mayors or mayors that were not pro-real estate?

1:12:53Carol Massar:But I think that it becomes a conversation for people as a negotiating tool more so than it's preventing them from making a decision. So I find that. Wait, so negotiating is that they want to buy something? Somebody has some pressure to say, reduce the price because I'm a little worried? Yes. Oh, interesting. If I've been on the market for 60 days, which I have on this piece of property, and it's still sitting, and they're like, listen, I'm happy to pay this. I'm not going to pay that. And I'm not concerned. I'm happy to wait until after the mayoral election. And the truth of the matter is that people, if you look at the rhythm of deals historically during these elections, there is a surge afterwards, but it doesn't change the result no matter what the result is.

1:13:38What happened during the de Blasio administration to real estate? You made reference to it.

1:13:43Carol Massar:I just think that they were decisions that were not collaborative. and if you think about in 2019, I mean, the rental law of 2019 that prevents conversions from occurring, that was all actually Cuomo. And Cuomo is not that far from the policies that Mondami is holding. And I would say that in my interpretation and my understanding that a lot of politicians in these times make a lot of promises that are not actually able to be accomplished in the manner that they're trying to the collaboration of the state is necessary exactly i'm glad you brought that up because that's one thing that we talk about all the time is like you need to have albany on board to make a lot of these things happen so it might sound look i'm not talking about any specific candidate in in particular but you know there are promises that are made on a campaign trail if you don't have buy-in from albany you're not necessarily going to to be able to enact those policies for sure and I think that that is that is by design so that there can be simpatico between the two or negotiations of those two offices but I just think that how to accomplish better housing you can look at the things like for the 485 the new tax that has just come in and it's our new 421, which is affordable housing.

1:15:16Carol Massar:I think that the restrictions that have been put forth into that new tax abatement, it may not lead to as much housing as we're hoping because of some things like if you do more than 100-unit building, your minimum wage goes up, costing 20 % additional hard cost. So it's just a delicate balance. And I just remember the days when a developer bought a certificate and somebody sold it to somebody else and they do what they do, which is build amazing affordable housing. And it's just gotten a lot more complicated. Yeah. I mean, I just feel like when it comes to a lot of major cities, right, affordable housing, it's something we've been talking about forever.

1:16:08Carol Massar:And you can't do it. One politician can't do it. It has to be the state, it has to be the city, and it has to be the city assembly. And a longer-term commitment to doing it. We are talking with Louise Phillips Forbes. She's real estate broker. Brown Harris Stevens here in our Bloomberg Interactive Broker Studio. A couple of rapid fires. So home staying on the market longer, yes or no? Like, I don't know, compared to, I guess? It's shortened in the first two quarters, elongated a little bit in the summer, and it seems to be a little more efficient in the coming weeks that we've seen in September.

1:16:42Carol Massar:Although it's hard to figure that out based on the Jewish holidays as well as getting back to school. Good point. First-time homebuyers. Are we seeing more of them? Older than they've been in a long time. Average is 40 years. All right. What about parents buying places for kids? All day long. All day long. And it's not for, it's with. And even grandparents. Okay. Because, honestly, the conversations in the council that I've had with some family members is you can give it to them after you're gone or they can enjoy it today. And I just had that happen today. It accepted offer where we're facilitating that.

1:17:20Carol Massar:And, I mean, I talk to my kids about that also. I mean, they really want to work hard for what they have. But I would rather be with them enjoying it and I'm their debt. I'm their institutional debt. All right, another one I just want to ask you real quickly, cash buying, all cash. Still strong. Cash is king. Is that the foreign folks or not necessarily? Most of them - I hate to use the word foreign, but people who are outside the United States. That is typical because of how they pull that money out. It's also too complicated to try to get credit for them if they're not a resident. So it makes sense.

1:17:57Carol Massar:So cash is still king for them. But again, it is really, we're doing deals that are through a trust. And they're the institution. They're the bank. So they're coming across as cash. That's my rapid fire list. Okay. I just want to make sure you got through all of them. Short but sweet. I have one that might have a little longer of an answer. Consolidation in the industry. So the big news this week, Compass is buying anywhere for$1.5 billion. Anywhere. People might not be familiar with the parent company, but they own Coldwell Bank or Corcoran and Sotheby's International Realty. How does that change your world at Brown-Harris Stevens?

1:18:31Carol Massar:Listen, we've all been observing the Zillow-Compass battle around the private listing. And, you know, let's be clear. Rumor was it, and I don't know if it's factual or not, but Berkshire Hathaway was what the original hope of the first choice for Compass to acquire when that was not possible anywhere. You know, they have a lot of debt. and that senior debt, it's only a stock exchange. What it does for them in the New York market is they're capturing 40 % of that market. It'll be interesting, but also - Because of Corcoran and Sotheby's. Corcoran's, you know, Corcoran and Compass. That's a lot of global banker, right?

1:19:12Carol Massar:They're smaller, but they're national. Yeah. And I would say that, you know, it gives them a strong hold on a market that they really want. So how much of New York City will Compass have after this? 40%. Oh, okay. After the acquisition. After the acquisition. And I think that what I would say to that, and again, bigger is not always better. It's really hard to maintain culture. And there are 179 ,000 new agents. And how do you feel special? You know, and I mean, Robert Refkin is an impressive young man and a major, a major operator and a visionary. So I respect and admire him. I'm not a fan of the private listing platform.

1:20:01That was Louise Phillips Forbes, real estate broker with Brown Harris Stevens. She specializes in New York City.

1:20:07Carol Massar:All right, everybody still ahead on Bloomberg Businessweek, what Bloomberg's Chris Rauser calls the little cheat when it comes to feeling fit. I discovered the Catalyst suit, which is an EMS suit. It's a stim suit like physical therapists use after you get an injury. They kind of zap your muscles with electricity, and it encourages your muscles to work harder. More of it tenses up, and then it heals stronger. He joins us along with the owner of Catalyst, maker of the Catalyst suit. This is Bloomberg.

1:20:40Carol Massar:Support for this show comes from Public.com. If you're actively involved in your portfolio, you probably catch yourself repeating the same actions. Buying the dip, manually sweeping idle cash, putting on a hedge. On public, you can now create AI agents that handle all these tasks on your behalf. Just describe what you want to do in plain English. Like, if the VIX hits 25, buy a put option on the S &P 500. Or, if my cash balance goes above$20 ,000, move the excess into my direct index. You approve the workflow and your agent handles the rest. Monitoring the market, watching for your conditions, and executing your strategies exactly as defined.

1:21:18Carol Massar:An investing platform driven by your intent, not just your clicks. You can also get full read and write access to your account via the public API. Go to public.com slash market and fund your account in five minutes or less. That's public.com slash market. Paid for by Public Investing. Brokered services by Open to the Public Investing, Inc., member FINRA and SIPC. Advisory services by Public Advisors, LLC, SEC Registered Advisor. Complete disclosures available at public.com slash disclosures. The thing about AI for business, it may not automatically fit the way your business works. At IBM, we've seen this firsthand.

1:21:58But by embedding AI across HR, IT, and procurement processes, we've reduced costs by millions, slash repetitive tasks, and freed thousands of hours for strategic work. Now we're helping companies get smarter by putting AI where it actually pays off, deep in the work that moves the business. Let's create smarter business. IBM.

1:22:46Whether you're sending money to family overseas, spending while on your holiday abroad, or paying bills across borders, Wise makes moving money simple, transparent, and straightforward. Wise offers 24-7 customer service and runs over 7 million daily checks to spot and stop fraud. And most transfers happen in under 20 seconds, which means your money arrives in less time than you've been listening to me. Join millions, saving billions. Be smart. Get Wise. Visit wise.com or download the Wise app today. T's and C's apply.

1:23:46Carol Massar:not complicated, for patients and providers. Things like making it easier to get care that looks at the whole person, from primary care doctors to mental health support and even in-home care, and then using technology to make sure they all work together. Technology designed to help doctors spend less time on busy work and more time with their patients. And those prescriptions? Optum is working to bring costs down, save patients money, and make it easier to get refills. Little by little, Optum is helping make healthcare work as one for everyone. Head to business.optum.com to see how. This is Bloomberg Business Week Daily with Carol Masser and Tim Stenevek on Bloomberg Radio.

1:24:29Carol Massar:Well, it's the jolt that tickles your muscles. And suited up in the Catalyst Gen 4, you might look a bit like one of the Avengers. It's pretty cool. It is all part of looking and feeling your best, as Bloomberg Pursuits editor Chris Rauser writes about the new issue of Bloomberg Business Week with pursuits devoted to the pursuit of wellness. Here with more is Chris Rauser, along with Brendan Kennedy, the CEO of Monty Mare. It's the owner of Catalyst, and they both are here in our studio. Welcome, welcome. First of all, I got to start with you, Chris. How did this come on your radar? I mean, I know you are always kind of the king when it comes to things that you can try to feel better, to look better.

1:25:04Yeah, I'm a fitness person. I'm a wellness person. I'll try anything once. If you ask me to do a form of exercise with you, I will do it. So I've done everything, Solid Core, Physique 57, Zumba, you name it. I've done it. Hot yoga, hotter yoga. Something in a chair yoga? Yes, yes. There was briefly a Pilates studio in Manhattan called Shays 23 because you did all the exercises in a chair and it was on 23rd Street. So at the beginning of the year, I just was thinking about how overwhelming wellness has gotten. There's endless podcasts. The Manosphere podcasts are just like telling you so many different things every week to do.

1:25:37There's businesses where you can spend like$7 ,000 a month where you go and you get tested for all this stuff every month, get AI to tell you what to eat and what to exercise just feels very overwhelming. And I thought, okay, what's the response to that? What is my response to that? I want to cheat. I want to cheat code. I want an easy way out. I want to hack. And so we got the whole Pursuits team together to think to like, go out and do research and figure out what are like the hot wellness hacks right now that makes it easier for you. Because at the end of the day, what you really need to do is exercise, you need to sleep, you need to talk to people, and you need to eat well.

1:26:09That's basically all you need to do. So what are the things that can hack your way into doing those more easily? And so as I was doing my research, I discovered the Catalyst suit, which is an EMS suit. It's a stim suit like physical therapists use after you get an injury. They kind of zap your muscles with electricity, and it encourages your muscles to work harder, more of it tenses up and then it heals stronger. And so that technology is now a suit that you can wear and you can do workouts and it like supercharges your workouts. Okay. I know the guy who owns the company is sitting right here, but I'm still going to put you on the spot, Chris, because I see technology like this and I'm like, yeah, does it actually work?

1:26:45I have to tell you it actually works. You're not just saying that because Brandon is sitting here. I mean, you can't see my bulging muscles through my blazer, but it really totally works. I did it for six months after having a pair of injuries. I had foot surgery. You guys remember I fractured my elbow. I was like out of the gym for months. I felt kind of bummed about it. And it really got me back going. Yeah, you really see results that help my posture. I lost weight, gained muscle.

1:27:07Carol Massar:All right. So Brendan, come on in. You are the owner of Catalyst. Talk to us about this device, kind of how it came to be. And tell us a little bit about the business. Yeah. So I joined EMS about four years ago. And I was a little skeptical at first too. My wife had used it about seven years ago. EMS is electrical muscle stimulation. Exactly. And just like a doctor or physical therapist will put stim on you to heal a muscle, it's the same technology. And doctors have been using it for 60 years. If you go to Europe, there are EMS studios where there's thousands of them where people will go in and work out.

1:27:46I went in skeptically and tried it about four years ago during COVID. And it's amazing. For me, it compresses time. I can get a two-hour workout, a workout that would normally take me two hours in a gym. I can do it in 20 minutes. And it's a whole body workout. It hits the little muscles in your back that you might miss in a gym or skip a leg day. It's your whole body, 26 pads at once. And it stimulates your muscle, just like your brain sends a signal to your muscle to contract. the suit sends the same muscles, the same signals, and it hits 90 % of your muscles. And so it's amazing. And it works, it's efficient, it's fast, it's safe, and it compresses time for me.

1:28:34So you were a client. I was a client. And then you became an investor, and now you're the owner. Yes. It's something I'm really passionate about. I use it three days a week, so 20 minutes each time, basically an hour a week. A little prep, a little cleanup. But compared to changing and driving to a gym and working out for two hours, I can do it in 20 minutes. I can do it at home. I travel with it. It's spectacular.

1:28:58Carol Massar:All right. So what does it cost? So the suit retails for$3 ,000. There's an app, and there's trainers on the app. So you pick, I want to focus on strength. I want to focus on cardio. Yeah. Maybe I'm going to focus on my lower legs or my abs. I'm 50 years old. I've worked out in gyms for 40 years. This is the first. I've done Ironman. I've done marathons. I've done every kind of fitness activity you can do. I'm very active. This is the first time I've had abs at 53, right? It's never happened before. It's all because of the suit. I can turn up the abs and hit those muscles. $3 ,000, you follow a trainer on the app, and that person leads you through a 20-minute workout.

1:29:40People might know you from your days in cannabis, medical cannabis specifically. You were one of the co-founders of Tilray. You led the company. It's publicly traded now. You're no longer involved in cannabis. What was the process that got you to buying Catalyst? And talk a little bit about the challenges the companies had before you came on board and what you're trying to do now to get it away from those challenges. Absolutely. So I think cannabis, you know, I started in cannabis back in 2011. So 14 years ago, and back then, people thought it was crazy, right? Like, what is he doing? He went to Yale.

1:30:16He has an MBA. Why is he going into cannabis? And he's throwing away his whole career. But I could see the future. I could see what was going to happen. I knew that country after country was going to legalize, and U.S. states were going to legalize. And so I saw the opportunity. I saw what was going to happen. I see the same thing in EMS. If you go to Europe, there's these studios everywhere with people working out in suits. And I think five years from now, everyone in the U.S. will be familiar with EMS. They'll either have a suit or they'll go to a gym and work out in that suit because it's the future of fitness.

1:30:51Carol Massar:Well, Chris, I mean, you do cover so much about wellness and fitness. We talk about it with you all the time. I mean, how do you slot this in? What are you hearing kind of from maybe the industry about maybe is this kind of a next wave? Yeah, I mean, this is definitely, we've done stories about EMS suits before. Plastic surgeons in New York City offer it. There's some startups that offer sort of similar things where you go to a studio. For me, this really fit into my normal system of going to Barry's Bootcamp. You know, I'm a big Barry's person and doing my normal weight lifts. And then I added this in two or three times a week, 20 minutes.

1:31:22And that's where I really supercharged everything else that I did. And especially on a day when, you know, like Brendan said, if you're too busy or you're traveling or whatever, you can just kind of toss it in. although I have not taken it on a plane before so I brought it with me so this is what it looks like it's quite big so for those listening on radio Chris is holding up the vest portion but there's also there's another portion

1:31:46Carol Massar:so it goes all the way down it goes around your legs there are armbands that go with it and you have to get it wet for the stim pads to really work you have to do that with a heart rate monitor too it's kind of the same thing very similar So what do you see as your market? Is it a case of selling directly to consumers? Is it about setting up places like the Peloton model to some extent where you could go and actually get on a Peloton and be at a physical location? I mean, Peloton kind of went back and forth. What's the model in terms of growing this business? So right now, there are thousands of consumers that own the suit and they work out at their homes or at the office or in their hotel rooms while they're traveling.

1:32:26And they work out with the app. There are also maybe 200 to 300 studios in the U.S. that use a suit. Many of them use the Catalyst suit. And so you can go to an EMS studio if you're mostly in a big city and try it. And so they use the Catalyst suit. And so it's both supplying to studios, and we're seeing more and more of those open, and then also to consumers. What's the moat that you have here? Because if this is big in Europe, you're doing it here in the U.S., People might catch on. They might see that it's working. Copycats could come in. What separates you? How do you protect the brand? I think there's two motes.

1:33:03I think the first mote is, oddly, an EMS suit is regulated like a toaster in Europe. And so manufacturers can just make them and sell them. Here, it's regulated by the FDA. And so this suit is FDA cleared. And so we went through the FDA process in order to sell it to consumers. That's one mote. I think the second moat is the content. There's hundreds of workouts online that you can engage in. The app actually is what sends the impulses to the suit. That's what zaps you. The app zaps you. Yes. And so the app does it. Wait, can I use this to my family to get them to do other things?

1:33:45Carol Massar:Just saying. No, forgive me. Go ahead. No, I think it's the content and the FDA clearance are really the two modes. What about competition or just the wellness world at large? Like it feels like, you know, we go through these fads and waves and trends. Yeah, you don't want this to end up in the same pile as the Thighmaster. I think that - Hey, everybody should have a Thighmaster. No, I'm just kidding. No, but how do you make sure? I think strength is important no matter what you do, right? And so I use my suit three days a week, 20 minutes. I run, so I have cardio. you can you know work out on a treadmill wearing the suit yeah people do that but i think strength will always be there strength will always be important it fixes your posture bone density for a lot of people is really important people on glp1 drugs lose strength and so this suit helps people of different demographics and ages very quickly you can work out while you're wearing the suit and also wear the suit independently while you're not working out or you're always working out while you wear there are people that do freestyle workouts which means the suit is is charging, impulsing, and they're folding laundry or doing the dishes or walking on a treadmill.

1:34:55Carol Massar:I think you and I need these. You're still doing it real quickly. Yes. Yeah. Oh yeah. I'm in. I got to tell you, I go to a doctor and they say it's all about strength and getting your muscles and building muscle strength. So it totally makes sense. Gentlemen, thank you so much. Really appreciate it. Brendan Kennedy, chief executive officer of Monty Mare, the owner of Catalyst, joining us here in studio, along with our own Chris Rauser. He's editor of Bloomberg Pursuits. you can check out and read more about Chris's experience. It was a really fun read. It's in the new issue of Bloomberg Business Week in the Pursuit section.

1:35:26Carol Massar:I'm in. I know you are. Chris, I don't know if this is the type of thing where we share a suit. We share a suit. I don't think it works like that. It has to be size to you, but actually, you and I, we could maybe do it. We could try it. Cool. It's pretty cool. I love the idea of it. Yeah, I'm like you, Chris. I'll try any workout class once. Can I get one for my face? Like to tighten up the muscles for that? No, I don't think you would want that. Speak for yourself, Chris. It's intense. It buzzes you to your bones. Does it? You get used to it, but it really is a lot. It can be really painful. Are you going to stick with it?

1:36:03Yes. Yeah, yeah. Okay. I'm going to keep doing it. I think, yeah. All right. We'll keep you accountable. Okay. Please do. That's Bloomberg Pursuits editor Chris Rauser, along with Brandon Kennedy, CEO of Monty Mayer. It's the owner of Catalyst.

1:36:15Carol Massar:And that wraps up the weekend edition of Bloomberg Business Week from Bloomberg Radio. Thank you so much for joining us. Be sure to tune in to Bloomberg Business Week Daily, Monday through Friday, starting at 2 p.m. Wall Street time on Bloomberg TV, Bloomberg Radio, and on SiriusXM channel 121. You can also listen to us on Apple CarPlay and Android Auto, free in the Apple App Store or on Google Play. You can also watch our daily broadcast on YouTube. Just search Bloomberg Podcasts. We're simulcast on Bloomberg Originals, available at Bloomberg.com slash originals, and streaming platforms, including Roku, Amazon Fire TV, Samsung TV Plus, and more.

1:36:48Find our Bloomberg Business Week daily podcast at Bloomberg.com, Apple, or wherever you get your podcasts. And the latest edition of the magazine is available on newsstands now at Bloomberg.com and always on the Bloomberg Terminal. I'm Tim Stenebeck.

1:37:01Carol Massar:And I'm Carol Masser. Tim and I are going to go put on our catalyst suits. I would try one of these. I would definitely try one of these. Have a great and safe weekend, everyone. Stay with us. Today's top stories and global business headlines are coming up right now. When you're running a business, the best days are the ones where priorities stay on track. For midsize and large companies, risk can affect multiple parts of the organization at once, from property and liability to cyber and regulatory challenges. At that level, managing risk becomes an ongoing discipline. At the Hartford, the focus is on helping businesses manage risk before it turns into something more disruptive.

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