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First Move with Julia Chatterley
Chinese Consumers Attack H&M and Nike over Forced Labor Stance; The Mission to Move Container Ever Given Continues; Twitter, Facebook, and Google CEOs Face Congress over Misinformation. Aired 9-10a ET
Aired March 25, 2021 - 09:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[09:00:32]
JULIA CHATTERLEY, CNN BUSINESS ANCHOR, FIRST MOVE: Live from New York, I'm Julia Chatterley. This is FIRST MOVE and here is your need to know.
Brand boycott. Chinese consumers attack H&M and Nike over their forced labor stance.
Canal congestion. The mission to move container Ever Given continues.
And tech testimony. Twitter, Facebook, Google CEOs face Congress over misinformation.
It's Thursday. Let's make a move.
Welcome once again to FIRST MOVE. It's been a week where reopenings uncertainty, vaccine delivery holdups, plus trade bottlenecks and supply
chain snafus have certainly bedeviled investors.
In fact, that monster container ship still stuck in the Suez, perhaps the most potent metaphor we've got right now. We will have the latest on that
by the way, and I can tell you, the solution is not simple.
There's also nothing simple about the current price action either. Wednesday was another rough day. For tech, the NASDAQ falling some two
percent as you can see. We're now off eight percent from recent highs, even as bond yields retreat. That's the conundrum.
Growth stocks like Tesla, Roku and Zoom that are not dependent on reopenings have also struggled. Tesla now down more than 10 percent year-
to-date, and speaking of stock, cruise lines saw a big drop yesterday, too, as the United States resisted calls for a summer cruise restart. Bad news,
of course, for Virgin Voyages who we spoke to earlier this week.
And of course, the jobs outlook also remaining uncertain, a further 684,000 U.S. workers claiming first time benefits in the past week alone, still
highly elevated, but it is the lowest reading since the pandemic, so we should mark that as well.
Let me give you a look at the global stock market picture. U.S. futures and Europe both lower as you can see. In Asia, a mixed picture with the Nikkei
bouncing some one percent. Chinese smartphone maker, Xiaomi, falling four percent despite posting stronger earnings.
But the real focus as I mentioned, there was the firestorm on social media, targeting foreign brands for comments on China's treatment of the Uighur
Muslims and that's where we begin the show today.
Nike, H&M and other apparel brands facing a boycott in China for raising concerns about reports of forced labor in the Xinjiang province.
The statements though are not new, but have resurfaced in the wake of fresh sanctions from the U.S. and the E.U. over China's treatment of Uighur
Muslims.
Steven Jiang joins us now and has all the details. Steven, great to have you with us. Just to give our viewers a sense of the scale of the pushback
that we've seen. I saw the viral hashtag, #ISupportXinjiangCotton was read more than one billion times. Talk us through what we've seen.
STEVEN JIANG, CNN SENIOR BUREAU PRODUCER: That's right, Julia. You know, this wave of a major backlash against major Western brands really shows no
sign of abating. In fact, this list of potential boycott targets keeps growing as we speak and we have seen many Chinese celebrities very publicly
severing their ties with these brands.
Not only H&M, but also Nike and now, Adidas, and also we have seen state and social media reports about least one H&M store for example announcing
its impending closure because of this. And major e-commerce platforms here, Alibaba and JD, have removed all of H&M products from their online stores
that even some map software have removed H&M from its search results.
So these reactions really have been very swift and some would probably say over the top. Now, some of the companies affected have issued statements
and responded to this saying they were simply trying to assess and identify potential, you know, forced labor risks in their supply chain and they
always respect Chinese consumers.
But statements like this really have not placated or satisfied the Chinese government, Chinese state media as well as many Chinese consumers who see
all of these criticisms and allegations as just Western concocted lies aimed at, you know, containing China's rise and smearing China's image.
So you know, the timing of this is really far from coincidental because one of the first online posts quote-unquote, "exposing" H&M, for example, came
from the Communist Youth League, that's the youth organization under the ruling Communist Party.
So many really see this as a state orchestrated campaign. Sending a very strong message to Western companies and by extension, Western governments
that you will pay dearly if you run afoul of the Chinese authorities.
[09:05:16]
JIANG: As you mentioned, this is happening against this backdrop of the U.S., E.U. and the U.K., imposing new sanctions against Chinese officials
over their alleged role in human rights abuses in Xinjiang.
So the Chinese government and Chinese state media have been really enraged by these developments. And so this is, again, their latest tactic to push
back at these allegations.
So as this issue of Xinjiang stays in the spotlight, you could imagine this will affect more and more Western brands, maybe putting them on a very
tough spot having to choose between profits and conscience.
But one thing to mention, Julia, this is also a very delicate balance for the Chinese to strike because they still want to present themselves as very
open and welcoming society and economy, especially ahead of the 2022 Beijing Winter Olympics -- Julia
CHATTERLEY: Yes, a delicate balancing act for all quite frankly, as you rightly point out, the lure of more than a billion consumers but at the
same time, the U.S. Secretary of State saying what's going on here is genocide trying to square that circle.
Steven Jiang, thank you so much for that.
And on a programming note, CNN will have an exclusive report on the Uighur parents desperate to reunite with their children. Amnesty International
says China's policies towards the Muslim minority have split up thousands of families, and David Culver has traveled to Xinjiang to look for the
children who have been left behind. Just his quick preview.
(BEGIN VIDEO CLIP)
DAVID CULVER, CNN CORRESPONDENT (voice over): Followed by a convoy of suspected undercover Chinese police vehicles --
CULVER (on camera): The tail is still on us.
CULVER (voice over): Blocking roads that lead to possible internment camps, keeping us from getting too close to so-called sensitive sites.
CNN searching for the lost Uighur children of Xinjiang.
UNIDENTIFIED MALE: She definitely misses me, too.
CULVER (voice over): Thousands of families have now been ripped apart due to China's actions. We tracked down two of them.
CULVER (on camera): Do you want to be with them? Do you miss them?
TEXT: Lost children of Xinjiang.
(END VIDEO CLIP)
CHATTERLEY: The exclusive report: "The Lost Children of Xinjiang" plays in an hour's time on "Connect the World" right here on CNN.
It's worth watching, so don't miss it.
All right, let's move on. Days to weeks. That's how long it could take to free the container ship currently blocking the Suez Canal. That's according
to the Dutch salvage company tasked with the mission to move it.
John Defterios joins us now. John, we talked yesterday about just how important this is as a trade route, but if we're talking about it being
blocked for days to weeks, I mean, that's going to create huge issues. What are the options here for trying to move the vessel?
JOHN DEFTERIOS, CNN BUSINESS EMERGING MARKETS EDITOR: Well, it's amazing since our discussion yesterday, Julia, we're two days into this effort, and
we have a much clearer idea what's taking place within the canal, and the three options are pretty clear.
It's tugging, dredging and unloading. And none of them seems to be unfolding very quickly at this stage, particularly if you have to unload.
We now know because of that, the Suez Canal authority has suspended all traffic going into this major artery that handles 30 percent of all
seaborne traffic, not too surprising, but it did also announce there are two major salvage companies being hired in, the big guns, if you will.
One of the CEOs of the two companies, Boskalis was suggesting that if you have to unload the vessel, it could take weeks; if we could really dredge,
it would take a matter of days. This is sending shivers throughout the trading community, of course.
The two companies are Smit, a partner with Boskalis and the Nippon Salvage, because the vessels owner is indeed a Japanese.
Now, the current technical manager that's been doing the operation so far, BSM, so they tried to dredge along with tugging, but they're not having a
great deal of influence so far.
And in fact, you look at some of the photos that are out there, you see this digger underneath the Ever Given, the vessel that is stranded and it
seems completely dwarfed.
And in fact, on Dutch TV, when the CEO of Boskalis was asked: what do you think of this -- this is a great quote -- he says, "That ship is very much
in the way." It's got to be moved, Julia, but not in the current operations or the current state of play in terms of how they're trying to solve it.
CHATTERLEY: I'm sort of smiling, but it's not funny at all, but very much in the way is most definitely understating the problem here.
Diverting the vessel, I was looking at a map --
DEFTERIOS: Yes, it is a very Dutch sense of humor, that sort of parallel.
CHATTERLEY: Yes, I was about to say, even drier than the Brits.
Let's talk about the Suez Canal. Allianz said that 10 percent of global trade goes via this route. This is critically, critically important and I
was just about to say, I was looking at a map earlier, and if you're sort of diverting around the Cape of Good Hope in the southern tip of Africa,
surely that's going to add days if not weeks to the journey.
So if you're a supplier here trying to decide whether you hang on in there, and you wait for them to dredge this and hopefully move it or you start
redirecting your supply routes, I mean, these are tough decisions to make and either way, it is time lost.
[09:10:05]
DEFTERIOS: Yes, indeed. So if you're in the southern tip of that canal, you have to say do I make a U-turn and head for the Cape or not? It does
add a week. So those decisions will probably be made over the weekend, whether you cut your losses and move on.
And we've been talking about kind of the volume of trades, some are saying 10 percent, but it's 30 percent of seaborne traffic, that's for sure.
But what does that mean, on a daily basis? Well, we've got some information from Lloyd's List saying it's $10 billion with the eastbound and westbound
traffic. The westbound traffic is a slightly higher. So that is huge scale when you talk about the movement that's taking place right now.
And then we said, there's dozens of vessels parked. We have an exact number from List today, and they are they are suggesting it's 156. I thought it
was interesting, just over 10 percent of those handle oil, gas and petrochemicals.
Remember, we had that six percent spike in the oil market yesterday, Julia. We're coming down a little bit, down about two and a half percent on Brent,
two and three quarters percent and three percent for WTI, so no panic in the oil market. They think this can be solved as we go forward.
It's not going to be that much of a simple equation, and then you have to start thinking about the fallout here of the claims going forward.
We know now that the owner of the Ever Given is the Shoei Kisen of the Ever Given Ship right now. Evergreen Marine is the one that chartered it, and
they are suggesting that the third party owner will of course, have to pay. They have no claim so far, and the number one priority right now is getting
that vessel afloat yet again.
CHATTERLEY: Yes. Watch this space, we shall see. John Defterios, thank you so much for that. There's not much space. That's the point.
All right, let's move on. Did Big Tech play a role in the attack on the U.S. Capitol in January? Well, that's the big question the CEOs of
Facebook, Twitter and Google will face in just a few hours' time during a remote hearing with members of Congress.
Donie O'Sullivan, is on the story for us. Donie, great to have you with us. Interesting to see Mark Zuckerberg trying to get ahead of this hearing
already and proposing some degree of limitation for these online, particularly key social media giants. What do we make of this? And what do
you think we hear today?
DONIE O'SULLIVAN, CNN BUSINESS REPORTER: Yes, Zuckerberg's testimony, one line here, he says, "We do more to address misinformation than any other
company," quite possibly because his platforms have more misinformation than any other company.
What we're likely to hear today from these tree tech execs, Google, Facebook and Twitter is that they're all doing a whole lot of work to
tackle misinformation and hate and all the money they're investing in the new policies and technology they brought in.
But the facts and the evidence that we've seen over the past few months will really be able to challenge those assertions.
Just a few weeks before the violent insurrection in Washington, D.C., Steve Bannon, formerly of the Trump White House posted a video on Facebook, on
YouTube, and on Twitter, where he said Dr. Anthony Fauci and the F.B.I. Director Christopher Wray should be beheaded. Twitter, totally shut him
down, banned him forever. Facebook has said that that wasn't enough for a ban. He's also -- his account is also still up on YouTube.
So there's so many examples like that. There's hundreds, there's thousands of examples, frankly. So it's going to be, I think, quite difficult for
somebody like Mark Zuckerberg to say, I don't want my platform to be used to incite violence, and then standby decisions like the Bannon one.
CHATTERLEY: Threatening to behead someone is not enough to trigger the comment being taken down or for someone being banned. I mean, really?
What about -- there are two things for me here, it's the algorithms that we've talked about so many times in the past that push people towards
creating an echo chamber of like-minded views, which in this case, pushes people towards extremism, Stop the Steal, of course, post the election was
critical to the Capitol attacks, but also the business model, which is driven by advertising.
And there was a letter that was sent to again, Mark Zuckerberg, I don't want to point him out, but we do keep coming back to him that tactical gear
ads were being shown, promoted next to those posts that we're promoting the Capitol riots, too. I mean, Donie, if ever there's a head bang moment, it's
this.
O'SULLIVAN: Yes, it's been a year of head bang moments, honestly, around all this stuff. You know, look, I mean, this is precisely what these
platforms are frankly designed to do. They are designed to connect advertisers to people based on their interests. So that is a feature, not a
flaw as one might say.
And look, as I mentioned, we do focus a lot on Zuckerberg. It is because his platform really is being used as an engine to stoke a lot of this, but
we saw with Twitter, too.
I mean, Twitter, of course, was home to President Trump, but also throughout the weeks, especially those months between the election and the
insurrection, there were accounts with hundreds of thousands of followers every day, spewing lies about the election, false or misleading videos.
There were QAnon accounts with hundreds of thousands of followers. They didn't shush any of them down until the days after the insurrection.
[09:15:16]
CHATTERLEY: Donie, you get the quote of the show, that's a feature, not a flaw, and until the perception is that this is a flaw, nothing is going to
change whether it's the advertisers or the CEOs, or we, as users, Donie.
Awesome job, and very quickly, I believe you had a special birthday this week. So, I just want to say Happy Birthday to you.
O'SULLIVAN: This job is aging me.
CHATTERLEY: You're so old, my friend. It was 30, wasn't it?
O'SULLIVAN: It was.
CHATTERLEY: I can't wait until I get to 30. Donie O'Sullivan, great to have you with us. Thank you.
All right, from Washington to Europe, where diplomatic tensions grow over COVID-19 vaccines. European leaders holding a virtual meeting to discuss
whether to block vaccine exports to countries with high inoculation rates than the E.U. such as the U.K.
Nic Robertson joins us live from London. Nic, have got to get that right, whether or not to block vaccine exports to nations like the E.U. This is a
diplomatic mess. What's the likelihood that the E.U. decide to do this?
NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: It's not clear. I mean, certainly not all 27 E.U. nations are aligned on this. Germany, the
Netherlands, Belgium, Ireland as well have not of the view that this is the right way to go.
The British Prime Minister doesn't get a vote because U.K. is no longer in the European Union is the mind that it's not the right way to go as well.
The two sort of key issues here are reciprocity and proportionality. And this is when the E.U. decides should it ship vaccines to another country
reciprocity? Are they shipping back? Are they shipping vaccines or vaccine components to us?
If the answer is yes, tick that box and move forward in proportionality. Is that country you're shipping vaccines or vaccine products to further ahead
of you in terms of vaccine rollout, and with the U.K., the U.K. is wildly ahead of the European Union. It's averaging right now about 45 shots per a
hundred people, the E.U. is sitting at a meager 13 shots per a hundred people. The world sort of average right now, if you will, is only six shots
per hundred people.
But you can see, if the E.U., 27 leaders today in their virtual vote decide to move ahead without proportionality, then yes, the U.K. could find itself
coming up short of vaccines. The view from the European Union is that the U.K. has been unfairly getting AstraZeneca vaccines. We heard from the
Secretary of Health, Matt Hancock saying that actually, the U.K. had, you know, had an exclusive deal with AstraZeneca. That's how they got their
proportion of vaccines where the E.U. only had, as best can achieve deal.
So this is really high stakes. We've heard from a European diplomat who said, look, if this goes the nuclear option of ticking both boxes and
saying, that's it, we're going to cut off some countries. It's going to backfire in the end.
There are some European countries who have big pharmaceutical industries that contribute significantly to their GDP, and in the long run, the fear
would be that those companies can be hurt. Yes, it's high stakes today.
CHATTERLEY: Yes, high stakes. And of course, as Emmanuel Macron said we simply lacked ambition, the E.U. lacked ambition on vaccines relative to
other nations and that was the initial mistake.
Nic, we shall see what happens. Nic Robertson there, thank you for your context, as always.
All right, still to come on FIRST MOVE, Intel putting its chips on the table, an interview with the CEO on accelerating design and manufacturing
in the United States.
And a much needed lifeline in Brazil as it grapples with COVID-19, the delivery company that's providing financial support, too, for some of its
restaurants. Stay with us.
(COMMERCIAL BREAK)
[09:22:05]
CHATTERLEY: Welcome back to FIRST MOVE live from New York where U.S. majors are lower premarket. Tech set to extend Wednesday's two percent
loss. As you can see, we're down seven tenths of one percent premarket.
U.S. President Joe Biden set to hold his first formal news conference since taking office later today and therefore could shed new light on his
upcoming stimulus proposals.
Treasury Secretary Yellen repeating in congressional testimony yesterday that taxes will have to rise to fund the President's multitrillion dollar
wish list. New spending, of course, likely will necessitate new borrowing.
But for now, we continue to see pullback in yields in the United States back below that 1.6 percent as you can see, end of quarter rebalancing
could be at play here with some investors needing to sell stocks and buy bonds before the end of the month. And of course that then brings yields
lower.
Intel unveiling an ambitious turnaround plan. The company's new CEO, Pat Gelsinger says he will spend $20 billion building two chip factories in the
United States. It comes as competition intensifies from rival semiconductor giants, including Taiwan's TSMC and South Korea's Samsung.
I spoke to Gelsinger after the announcement and asked whether $20 billion is enough and if they're prepared to spend more, if necessary.
(BEGIN VIDEOTAPE)
PAT GELSINGER, CEO, INTEL: The simple answer is yes. And we do see that government incentives and as you said, we're putting our chips on the table
and the $20 billion, right, doesn't assume anything on the part of governments, but we said hey, we're ready to go bigger and faster. We may
need some help to go faster, but we're putting a lot on the table ourselves.
We also expect that this is, you know, a growing cycle of capital investments overall. And we do believe that it's going to be, you know,
continued meaningful investments over the next several years as we build out, you know, the world's largest factory network.
So yes, this is the beginning. It's a big journey and we're getting extraordinary interest and support from customers and governments
worldwide.
CHATTERLEY: The Biden administration is going through a Hundred-Day Review here just to understand what support, what help as part of a strategic
priority to focus on chip technology and ensure supplies to your broader point, be specific, what more help does the sector need?
GELSINGER: There's a couple of things that's being looked at by the Biden administration, and one of those is what's called the Chip Act, and this
was passed late last year, and now needs to be funded and be applied against manufacturing and R&D. And we're working closely and we had
Secretary of Commerce Raimondo join us for our announcement and really put the administration's stamp of approval on what we're doing.
Similarly, we're seeing such actions in the E.U. as well with their semiconductor industry activities. So we're seeing those two governments
step forward in strong ways to support these efforts. And some of that will be R&D incentives, some of that will be manufacturing investments, some of
that will also be supplying the unique government needs as well, and they have a program called RAMP-C that we've applied for to become a supplier
to.
[09:25:20]
GELSINGER: So these taken together, we think are good programs, and we're now just looking forward to get them totally, totally funded and underway,
because we're ready to move as fast as they are.
CHATTERLEY: And, you mentioned what clients are saying in client feedback? We know Microsoft is on board, because we heard from Satya Nadella. What
about the likes of Apple? Can you win them back in the future?
GELSINGER: Well, in many cases, what we see is that we have great opportunity to go to people who might have otherwise been competitors and
let's make them customers.
And people like Qualcomm are supporting our announcement and we had Microsoft and IBM. And we hope to have NVIDIA and Broadcom and all of these
companies taking advantage of the leading process technology, and of course, Apple as well.
And I mentioned them in our announcement yesterday. Absolutely. I want them to be a customer or a foundry, but we have to go earn their business, and
really prove that we can be a good foundry supplier, have the capacity they need, the unique aspects of different design tools and intellectual
property blocks for them to make available. And yes, I hope to make all of them customers of Intel foundry services soon enough.
CHATTERLEY: Fast forward five years, where is Intel?
GELSINGER: Well, as we would say, we are out to be the premier semiconductor computing company on the planet. And we are, as we like to
say, you know, our technologies improve the lives of every human on the planet. Few companies get to make such audacious statements.
But the power of technology, and I've called it the four superpowers today: Cloud, AI, connectivity and 5G and Edge computing, these superpowers are
permeating every aspect of human interest, human lives and human experience.
And underneath that, everything runs on semiconductors. And I want a piece of Intel in every one of those improving the lives of every human on the
planet.
And that's the journey that we're on, and you're building fabs and manufacturing, designing chips is simply a way to accomplish a much more
eternal, impactful and global objective that we would have.
(END VIDEOTAPE)
CHATTERLEY: The new Intel CEO speaking there. All right, the market opens next. Stay with us. We're back after this.
(COMMERCIAL BREAK)
[09:30:45]
CHATTERLEY: Welcome back to FIRST MOVE where U.S. stocks have opened lower and a continuation of the weak price action in the technology sector in
particular seen Wednesday. As you can see, the NASDAQ off almost one percent at this moment.
In the meantime, the U.S. reporting that weekly U.S. jobless claims have fallen below some 700,000 for the first time since the start of the global
pandemic. That's the number year, one year on. It's both encouraging perhaps for that reason, but it's also devastating, I think and it makes
clear that reopening uncertainties persist. It's still 684,000 people.
Add that to concerns about worsening U.S.-China trade relations, global supply chain bottlenecks and that could also play into higher inflation
expectations, too. There are plenty of uncertainties.
Energy prices, also feeling this as well. Brent and the U.S. crude off some three percent as you can see offsetting the supply concerns triggered by
the container vessel that's holding up shipping in the Suez Canal.
Now, one pandemic uncertainty though that may have cleared. Let's give you some good news. AstraZeneca publishing updated U.S. trial data and a
slightly lower 76 percent efficacy rate, but of course, still potent.
The company reiterating the vaccine is 100 percent effective in preventing severe disease and hospitalization, too. Now, awaiting approval, of course,
for authorization in the United States.
So a year on since many in the world began the huge work from home experiment, workplace messaging app, Slack says the remote office is here
to stay. They've unveiled a new range of tools to help what it calls the reinvention of work. One of those tools are causing a little bit of a stir,
the feature allowed users to direct message people in other companies.
Joining us now is Stewart Butterfield, the CEO of Slack. Stewart, always great to have you on the show. This is where we do a coordinated eye-roll
quite frankly, because the product that you announced allowing other people to message people in other firms is a great idea.
But you've faced criticism over how it may be abused by individuals. So talk us through the changes that you've made, and then we'll move on.
STEWART BUTTERFIELD, CEO, SLACK: Sure, we -- thank you for having me. Slack Connect is a system that lets two Slack-using organizations share
channels and direct message across organizational boundaries, and the intention is that people use it with their customers and partners or
vendors. We use it with our auditors, with bankers, with creative agencies.
And the announcement yesterday, was making it easier for people to set up direct messages outside of the context of shared channels. There were a lot
of confusion, I think, there's an unforced error on our part in how the invitation system worked and that was confused with the ability to send the
messages themselves.
The purpose of this is actually to increase security and to increase control, it's a double opt-in on both sides, and people have complete
control over who is able to message them. So it's actually a pretty big step up from things like text messages, WhatsApp, e-mail, and so on.
CHATTERLEY: You know, we've talked in the past about wanting to find a way to avoid ever having to send e-mails. Have you ever been in a situation,
and actually this perhaps plays into that future focus for the firm, a client that has replaced e-mail entirely and just uses Slack to
communicate?
BUTTERFIELD: Absolutely, yes. I mean, so to be clear, you can't get rid of e-mail entirely, and we have no intention of trying to do that, because it
serves many purposes. But that's the downfall of it as well, when used for internal communication.
So there's many, you know, probably thousands of organizations that don't use e-mail for internal communication. But of course, they still have to
use it for getting receipts from online purchases and resetting passwords, and receiving calendar invites and a whole bunch of other stuff.
CHATTERLEY: You know, when the SolarWinds hack took place, and I don't think it was talked about enough, you were one of the first people I
thought of, and the fact that e-mails do remain incredibly vulnerable, if they are hacked, is this another argument for perhaps a system like Slack
as an alternative?
And you're saying, look, we're never actually going to formally replace e- mail, but as an alternative, or are you equally vulnerable to hackers, if they decide they want to target you?
BUTTERFIELD: Well, we're a pretty big target. We have an incredible security team and many active programs that we know work to prevent that.
We work with governments in 20 different countries, large financial services firms as customers and we are often chosen on the basis of the
increase in security.
[09:35:09]
BUTTERFIELD: And look, e-mail has the virtue, I think, of being a totally open decentralized system anyone can participate.
But the flip side of that is, it's a much harder system to control. There's more problems with phishing and spam. So I think e-mail is very useful and
will continue to be used probably for tens of thousands of years at this point, in that open and decentralized way, but where you have control and
where you have a choice about how you communicate, that's the internal case, people are much better off choosing a tool like Slack.
CHATTERLEY: Yes, I was about to say, I should mention the reason why I mentioned that point about getting rid of e-mail was Marc Benioff, of
course, Salesforce, who said that he would love to get rid of that at some point in time. So your context here is very important.
But something else that you just talked about there, and I think this is very important. Is the growth that you're seeing in paid customers, but
also your international growth, and if I looked down, because you've provided the stats, and we've got some here, just the sheer percentage of
companies within some of the biggest indexes in the world that are now using your services and paying for it. I mean, these numbers are
phenomenal.
Forty percent of the FTSE 100, sixty eight of the Fortune 100, twenty seven percent of the ASX 200 in Australia. I mean, how high can these percentages
gets to? And what's the ambition?
BUTTERFIELD: I think we can get to a hundred percent. I mean, we're not sure where we are for the U.S. now, maybe 70 percent of the Fortune 100,
and Slack is used by 156,000 businesses around the world.
And so obviously, there's only, you know, 500 in this index, and 100 in that index. And 156,000 is a much larger number. So that includes all kinds
of businesses. It includes people operating small retail stores, or plumbers, repairmen, but also the biggest issue of credit cards in the U.S.
and the largest government contractor and the number one in retail, the number one consumer electronics.
You're right to point out the international growth, though, because we had 43 percent revenue growth this year. You know, a fantastic result. But if
you look at France, for example, it's 47 percent. If you look at Japan, it was 76 percent.
Looking at the growth in the number of paid customers, which is kind of a leading indicator of revenue in the future, much bigger numbers. Australia
is 93 percent. The U.K. was 94 percent. Germany is a hundred percent.
CHATTERLEY: Yes, it is not just a U.S. based product to you. Oh, boy, is the growth international now and increasingly so.
You know, I always watched before we have these conversations, what you say on Twitter, and you made a really fascinating comment, and it ties to the
point about the future of work. You wrote: "Thirty four percent of our product team started post pandemic, (also clearly tied to this strong
growth that you've seen) but it's never been to one of our offices met their coworkers in person."
I mean, that, as you describe is mind boggling. And there are many businesses around the world like that. How do you make that kind of
teamwork when over a third of them have simply never met or been in an office? These are huge challenges. And these challenges aren't going away
anytime soon.
BUTTERFIELD: Yes, there's huge challenges. The really interesting thing to me is, and the kind of my hope is that we, in the broadest, most inclusive
collective sense, not just Slack, not just Slack customers, but everyone who use this opportunity to kind of reinvent and reimagine how we work,
because there's obviously many things to be liked about the old world.
And while no one would choose to re-live 2020, many people have pointed out the things that they like about this world, and that might be no longer
having to commute, that might be the ability to spend more time with our family, that might be increased flexibility.
When systems get pushed this far off equilibrium, there's the opportunity for big change that just doesn't exist. So all the things you've mentioned,
you know, I would put myself in the camp of people who 13 months ago, back in February, last year would have said it's impossible for us to all start
working from home and maintain the same level of productivity.
And I think, most executives, most leaders would have agreed with that and then when it turned out that we had to, what we thought was impossible
turned out to be possible.
So I guess the onus is on everyone now to question what other things we thought were impossible are actually possible, and what kind of work style
do we want to create?
CHATTERLEY: Do you think there's a risk of burnout though with people working at home? The stresses are different. Children, people around you,
do you think it is sustainable for some of these reasons? Because I don't think we talk about this enough, the mental health aspects, too.
BUTTERFIELD: Yes, it's a huge concern for us, and I think you have to separate the impact of the pandemic, the anxiety that comes with that, you
know, the lack of the amenities of normal life not being able to sit in a cafe and watch people go by or get your nails done, or just anything that
people enjoyed in the old world.
If you take that away, then I think the increased flexibility will be good. And it's not necessarily about working physically from inside of your home,
because you might have a very small apartment, it might not be a convenient space, but the ability to live where you want and still work for the same
company, the ability to move outside of commuting distance, so you can have a larger house for your family. All of that risk of burnout, I think is
really driven by, you know, just cruising on default.
So the way that we organize, the way that we lead, the way that we manage organizations has been really dependent on the physical infrastructure.
But over the next five years, I think every organization will end up being what we call digital first. So take the digital infrastructure of the
organization as seriously as they did the physical infrastructure, the buildings and their leases and the real estate and the management of all
that hardware.
[09:40:36]
BUTTERFIELD: It would seem -- you know, if you want to take advantage of everything that this world offers, which includes recruiting candidates who
live in markets that you probably haven't been able to recruit from, creating more flexibility. The need is to take that digital infrastructure
a lot more seriously than I think we have over the last 10 or 15 years.
CHATTERLEY: We just lost you at the end there. Great to chat. Thank you so much for joining us. Stewart Butterfield, the CEO of Slack with a vision of
the future there.
We're back after this.
(COMMERCIAL BREAK)
[09:44:08]
CHATTERLEY: Welcome back to FIRST MOVE. Into Brazil where COVID-19 deaths are at record levels.
President Bolsonaro has now created a Crisis Committee to oversee the government response and says 2021 will be the year of vaccinations.
More than 300,000 people have now lost their lives to the coronavirus with the daily death toll pushing past 3,000 for the first time this week.
Now, as well as the health crisis, there are huge economic challenges, too for Brazil and that's something one company there is determined to take
action on. The delivery giant iFood serves more than 230,000 restaurants across 1,000 cities in Brazil, as well as other parts of South and Central
America. iFood has also now set up a banking service to help restaurants and is also focusing on sustainability, too, aiming to become carbon
neutral by the end of the year.
iFood CEO, Fabricio Bloisi joins us now from Sao Paulo.
Wow, Fabricio, great to have you back on and you are clearly incredibly busy. Just start by telling us how your team are doing given the situation
there. And what you're seeing in terms of demand. Are people staying away from restaurants and trying to stay safe and getting food delivered
instead?
[09:45:15]
FABRICIO BLOISI, CEO, IFOOD: Hello, Julia. Pleasure to be here again.
As you said, the situation here is very difficult. We still have numbers of COVID going up, and it's a big situation for economics of Brazil, for
health of Brazil to have a lot of deaths.
We are really invested in keeping our people safe, keeping our customers safe, our drivers safe, and the restaurants alive, too. So we did a lot of
cash flow boost for restaurants, more than a billion dollars in money from the restaurants, we put more than $20 million in funds to keep the drivers
at home when they are seeking to improve their health through masks. So we are really investing in trying to make the population healthy.
But I have to tell you, all this COVID fights show us that the public and the private companies, the public organizations and private can work
together to help society and that's why we are keeping all the COVID investments, but also really fighting in jumping in to be a difference in
the climate change fight that we have ahead to avoid the next COVID.
CHATTERLEY: I couldn't agree more. I want to talk about your sustainability fight because you are taking huge strides here. But first,
just -- I just want to get a sense because you are a delivery company, but you also are trying to provide the financial benefits, liquidity.
You've also got this prepaid Visa card for some of these. I mean, we've talked in the past on the show about who is banked and who isn't banked or
unbanked in the region. Just explain what a difference you're making to companies because I do think this is a critical part of facilitating their
delivery business rather than the in-house at this moment in time.
BLOISI: I believe all platforms, every time more invest to support their customers through financing, so we are really committing to help
restaurants to give them cash flow, lowers credit and financial service, the restaurants needs support at this time. We have an amazing amount of
restaurants closing.
So using our platform and our SKU to reduce their suffering in this moment is critical. And we are using a lot of technology to that, using credit
digital accounts and really giving you tools to the restaurants.
CHATTERLEY: Yes, I mean, the combination of these two things is vitally important. Now, I know you want to talk about sustainability, so we will.
I read that you make 48 million plus deliveries on a monthly basis. So that's a lot of journeys being made. That's clearly got a significant
carbon footprint.
How on earth, Fabricio, are you going to become carbon neutral by the end of this year, as a company and I'm assuming that includes the delivery,
too.
BLOISI: Exactly. Look, everyone is asking for more food delivery. We did 48 million in December. We are doing much, much more. We are growing 100
percent per year. Everyone wants food delivery, and we are helping lots of people to stay at home but with every delivery, we have a car or a bike
going to deliver, or a motorcycle and we also have many times that plastic packaging. And it's our responsibility to stop that.
So we are really putting lots of energy as a technology company to innovate not only on AI or in drones, but to innovate in fighting climate change. We
are doing that on three steps that is very nice to share with you all.
First measure, so now we talk about our index, our carbon footprint is 128,000 tons and review every quarter report, how we are reducing that. So
measure is the first. Second, we are really focusing to reduce -- so we started with electric bicycles. We are moving next week to electric bikes
with this big goal to have 100,000 electric bikes motorcycles in five years and we are going to do lots of financing to enable the electric bicycles to
prosper in Brazil.
And we are also invested on R&D on packaging because we want to use our scale to make all the plastic packaging recyclable through paper packaging.
So we measure -- we are working to reduce and also we are working to compensate.
So we enter in a carbon credit markets to buy carbon credits of projects in Amazon. What we can't reduce, we will compensate investors in Amazon
projects. We don't only want to reduce it, but want to be a positive carbon footprint. We want to generate everyone, when they buy food delivery, they
know that they are not only not polluting, but also saving the environment.
And I want to ask one thing from your viewers. We are working a lot on that. We are going to invest a lot of money, but I need you viewing this
show to think, I'm going to pay this premium -- green premium to work with companies that are more green.
And also the companies that are here, we need to put that to the top of our priorities and not sell only talk about financials. So that's our
commitment.
CHATTERLEY: I couldn't agree more with you. It's all of those consumers that need to take a step to target companies, buy from companies that are
actually trying to do this and do it incredibly quickly which you are.
Fabricio, great to have you on. Come back soon, please.
Fabricio Bloisi, the CEO of iFood. Great job and stay safe, please, over there in these challenging times.
BLOISI: Very good to see you. Stay safe.
[09:50:20]
CHATTERLEY: You too. All right, from a company that aims to deliver in minutes to a cargo ship that could be stuck for weeks. The latest on the
shipping jam in the Suez Canal after this.
(COMMERCIAL BREAK)
CHATTERLEY: It could take days or even weeks to free the massive container ship stuck in the Suez Canal. That's according to the head of a salvage
company looking at how to get the tanker out of one of the world's busiest waterways.
Vessels are stranded on both sides. Some might have to go around Africa's southern tip, meaning big delays to their journeys.
Ben Wedeman joins us now for more. Ben, we keep talking about how the Suez Canal is responsible for 10 percent of world trade. But what about
specifically for Egypt? What about the implications from them of having this waterway blocked?
BEN WEDEMAN, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, the Suez Canal, Julia, is a very important source of revenue for the Egyptian government.
In 2020, for instance, it earned $5.61 billion from operating the Canal and for ships to stop going through there for days and perhaps weeks is an
important loss of revenue, keeping in mind that we're also in the middle of the coronavirus pandemic, which has had an impact on another one of Egypt's
important sources of revenue, which is tourism.
And of course, there's simply the prestige of managing for years the Suez Canal, and suddenly having to tell a shipping company, sorry, you can't
come here.
And now keep in mind, of course, that between June 1967 and 1975, the Canal was closed, closed first as a result of the Six-Day War between Israel and
Egypt, and it didn't reopen until 1975 after the October War in 1973.
So Egypt has gone for long periods in its modern history where the Canal wasn't operating, but certainly now, in this day and age, it's an important
source of revenue, prestige, and for it suddenly to be blocked, to be closed is a real blow on many fronts -- Julia.
CHATTERLEY: Of course, many fronts in the region, too, whether we're talking about supplies. I mean, our viewers will recognize that you're in
Lebanon as well ravaged by the challenges of COVID, the explosion that the whole world was watching.
Ben, what about the implications for people there, too?
WEDEMAN: It's a real source of concern, Julia, because Lebanon gets its fuel to generate electricity from the Gulf and we already have prolonged
power outages. Last night, for instance, an unscheduled power outage in my neighborhood from 8:00 p.m. to 2:00 a.m. That's in addition to the regular
daytime power cuts.
[09:55:18]
WEDEMAN: If fuel just stops getting to Lebanon completely, a country already deep in crisis will really be on its knees.
Syria, for instance, gets a lot of its oil from Iran that goes through the Suez Canal. They also, in Syria, is suffering from a variety of well-known
crises, and if they lose their source of fuel on top of everything else, they also could be facing the abyss -- Julia.
CHATTERLEY: Yes, the whole international community needs to make this a top priority, the importance, the strategic importance of the Suez Canal
illustrated once again.
Ben, thank you so much for being with us today. Ben Wedeman there.
All right, that's it for the show. If you've missed any of our interviews today, they will be on my Twitter and Instagram pages in the coming hours.
Search for @jchatterleyCNN.
And in the meantime, as always, stay safe. "Connect the World" with Becky Anderson is next.
(COMMERCIAL BREAK)
[10:00:00]
END
