Morning Brew Daily - Paramount Nears $150M Deal for "The Free Press” & Sora Takes Over the Internet

Episode Date: October 6, 2025

Episode 685: Neal and Toby discuss the massive Paramount deal where they look to acquire Barry Weiss’s “Free Press” for $150 million as they rework CBS News. Next up, a look at the latest jobs data amidst the government shutdown and Sora 2 is officially live. Then why are meals now smaller sizes and a look at the week ahead.  Spend $250 on your first campaign on LinkedIn Ads and get a free $250 credit for the next one. Check out https://www.linkedIn.com/mbd for more. Get your MBD live show tickets here! https://www.tinyurl.com/MBD-HOLIDAY  Vote for MBD in the Signal Awards!  Best Daily Podcast: http://bit.ly/3W4e5ik  Best Commute Podcast: https://bit.ly/4pxZidv Best Business Podcast: https://bit.ly/3IE7lEP  Subscribe to Morning Brew Daily for more of the news you need to start your day. Share the show with a friend, and leave us a review on your favorite podcast app. Listen to Morning Brew Daily Here:⁠ ⁠⁠https://www.swap.fm/l/mbd-note⁠⁠⁠  Watch Morning Brew Daily Here:⁠ ⁠⁠https://www.youtube.com/@MorningBrewDailyShow⁠ Learn more about your ad choices. Visit megaphone.fm/adchoices

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pwc.com slash U.S. slash brew AI. That's pwc.com slash us slash brew AI. Good morning brew daily show. I'm Neil Fryman. And I'm Toby Howell. Today is Sora the end of social media as we know it. Then Friday came and went

without a jobs report. So what the heck is going on in the labor market? It's Monday, October 6th. Let's ride. Good morning and welcome back to the week. A big week for people who spent 50 years in a dark lab researching a single topic. The Nobel Prizes are going to be announced starting today, beginning with the Medicine Prize this morning,

followed by Physics on Tuesday, Chemistry, Literature, then the Nobel Peace Prize on Friday. As for economists, they have to wait until next Monday to find out who will take home the prestigious award in their field. So some quick history, the first Nobel Prizes were presented in 1901, and they were awarded in Medicine, Physics, Chemistry, Literature, and Peace. And it wasn't until 1968 that the sixth prize was created in economics by Sweden's Central Bank. And it's funny because noble purists say that the economics prize is not technically a Nobel Prize because it wasn't created by the man himself. However, it's presented together with the others.

So other people lump it in. Classic economists always being lumped in with the real sciences and making people mad in the process. Congrats to everyone who is nominated and, of course, the winners. But I do think it's funny that economics kind of got shoehorned in there. And now a word from our sponsor, LinkedIn ads. Toby, you are the best podcast co-host I know. Oh, Neil, you're making me blush. I thought you were going to tell me I'm the best pickleball player you know.

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It's created an information gap that is just as damaging as a negative jobs report. When businesses don't know where the economy stands, the natural instinct is to pause some hiring and investments going forward. Most forecasts suggested that the labor market is actually still growing, but barely. Bloomberg's survey of economists expected around 53,000 jobs added in September, but the unemployment rate holding steady at 4.3%. but private data tells a weaker story. ADP says private employers lost 32,000 jobs last month. Indeed, reports job postings are down 9% year over year,

while hiring plans tracked by Challenger Gray and Christmas have fallen to their lowest level since 2009. In general, the labor market looks like it's been tagged and freeze tag, stuck in what FedShare Jerome Powell describes as a low-hire, low-fire economy, with everyone kind of staring around at each other, seeing how AI is going to affect workforces and waiting to get more clarity from important data like the jobs report. So, Neil, it feels like businesses are back in high school sitting down for a test they didn't prepare for, mainly because the study materials, aka economic data, weren't even available to them in the first place.

Now, though, there are many different alternatives. There are third-party companies that have sprung up in addition to the official government data to sort of provide a picture of the jobs environment here in the United States. There's payroll processor ADP, which you mentioned. They have done a monthly report on the job situation since 2006. That wasn't taken so seriously back then. They revamped their methodology in 2022. Now the Fed considers a pretty reliable source of data.

There's the job posting site. Indeed, there's this newcomer called Revelyo Labs. There are 401K plans that Vanguard has used to gauge, you know, whether people are switching jobs because they're adding a new 401k plan that indicates that they have a new employment. Bank of America tracks its customers, cards use for insight. So there's a mosaic of different data providers that have emerged as a compliment to the government official data. Investors and the Fed say they have a decent amount of information here, but it's nothing, it's no one-to-one substitute for the comprehensive report that the government issues every month.

And what mosaic is this creating right now? What picture are we seeing right now in the labor market? And it's a picture of just not a lot going on. Last year, if you look at kind of the replacement rate level of employment, you needed to add about 130,000 jobs a month in order to offset people moving jobs or people losing their jobs. That was kind of the baseline replacement rate to keep the unemployment rate steady. Right now, it's looking a lot closer to that 50,000 job mark because people are looking out seeing a little economic uncertainty.

Maybe the quits rate and the firing rate is not as high. as it once was. People are just staying in their jobs because they want that security. And so you are seeing a much more stagnant labor market. It is funny, though. Meanwhile, you look at the stock market. Stock market is doing great. In the meantime, S.P 500 finished the week at a record high. It's been on a six-day win streak despite the government being completely shut down. So it is fascinating to see a little bit of discrepancy there between what's going on in the labor market and what's actually going on in the stock market. And people are staying in their jobs for longer, but they're also staying out of their jobs for a longer. One of the biggest stats that the Federal Reserve and businesses

are pointing to is the long-term unemployed. So the share of people who are defined as long-term unemployed are those who have been unemployed for at least six months is up to 26%. That's the highest in more than three years. If you also look at data from LinkedIn, you're seeing just very low churn around the jobs market. The share of members of LinkedIn members who have recently added a new employer to their profile is one of those alternative data measures where you can get a sense of how things are shaking out in the jobs market is about 20% below its pre-pandemic rate, not just in the United States, but across the sort of Western world in UK, Canada, and Australia. So people just aren't getting fired, but they also aren't getting new jobs.

Finally, let's just do a government shutdown update. There's not a ton of new developments that you miss. The Senate is actually reconvening this afternoon. They're going to try to vote on this continuing resolution to bring things back on the line. No one is super optimistic that they are going to see eye to eye this time around. I was looking at Polly Market this morning, the prediction market. And there's a 72% chance that the government shut down last until at least October 15th or later. It's October 6 right now.

So clearly they think there's a long road ahead. The roller coaster year for CBS News is about to take another dizzying turn. Today, owner Paramount Skydance will reportedly announce that it's acquiring the free press, an online publication for $150 million in cash and stuff. and it'll be installing its founder, Barry Weiss, as editor-in-chief of CBS News. A deal would represent a seismic shift for the 98-year-old network with a story tradition of mainline news reporting. The name's Edward Murrow and Walter Cronkite might ring a bell, and the 60 Minutes clock

is surely ticking in your head. It's also everything Barry Weiss stands against. The former opinion writer and editor resigned from the New York Times, saying she had been bullied by liberal co-workers and started up the free press on Substack in 2000. to challenge legacy media. It's been a huge success, becoming Substack's best-selling outlet in the U.S. politics category and boasting over 1.25 million subscribers, including more than 150,000 who pay. But as the top editorial leader of CBS News, Weiss would bring no experience in broadcast news

to a job that requires managing over 1,000 employees reporting on stories all over the world. And Weiss's years of railing against legacy media will likely set up a culture clash with her new colleagues who work in and cherish legacy media. Toby, so many storylines to tease out here. It's another huge shakeup for CBS under new owner David Ellison. It's a massive exit for a newsletter first company, probably the biggest in substack history. And it admits Barry Weiss is one of the most influential people in American news. Yeah, this is kind of Trump area political calculus that you're seeing from CBS right now because they had to pay to settle this lawsuit. $16 million, Paramount recently did, over 60 minutes interview with Kamala Harris.

And so installing Weiss is kind of this radical centrist as she likes to portray yourselves. It looks like they're trying to say that, hey, we are open to ideological diversity, which seems particularly important under the current administration and current regulators. And then also, Ellison has tried to rebrand CBS a little bit too, saying that, hey, we want to have credibility with, you know, a lot of audiences right now. We want to, you know, cater to the 70% of people, he says, are center left or center right right now. And then the final thing, too, is that it makes a lot of sense to kind of dive into this

substack era of journalism right now. We are seeing substack minting very, very influential in people with large audiences right now. And if you are a legacy media brand and you want to tap into a new audience, why not go after one of the biggest substacks on the platform? Why not go after Barry Weiss, who clearly has that digital native audience? It does show how the balance of power has shifted a little bit from legacy media like CBS News, which, you know, our parents' generation can imagine news without two, maybe more our generation or Gen Z that would maybe get their news more from podcasts or, say, a substack like Barry Weiss's, which is reportedly pulling in $15 million in revenue just four years into its existence. CBS News has really two shows that it hangs its hat on. One is obviously 60 minutes.

60 minutes just had its season premiere last week. that drew 10 million viewers. It is the most watch non-sport show of that week and really across television. Then also has CBS Sunday morning, which is the most watch weekend morning program that averages close to 5 million viewers weekly. But other than those two programs, it has declining ratings and revenue. And therefore, David Ellison is coming in and shaking up so many things across CBS. And also it's a movie division and also Paramount Plus, part of this big constellation of this. this huge media company thinks there's good reason to change things up at CBS News.

And obviously there's, you know, that huge political bullying factor from Trump as well. Welcome to Winners of the Weekend, the segment where Toby and I picked two things that scored all the free samples at the farmer's market. I won the pre-show pumpkin carving contest, so I get to go first. And my winner is AI Slop. SORA, a new AI video generation app from OpenAI, has reached number one on the app store, toppling its own chat GPT chatbot and Google's Gemini. The reaction has been intense and SORA has been called a lot of different things from a serious

TikTok competitor to the future of social media to the end of our understanding of reality. It lets users create short videos by typing in a prompt and the AI will spit out a hyper-realistic clip which you can share and consume on a TikTok-like feed. You can even include yourself in these videos by scanning your face to appear as an avatar. Many have criticized SORA as exacerbating the problem of AI slop or mindless AI-generated media that hijacks people's brains but doesn't serve any purpose or contribute to the world. The Financial Times compared it to ultra-processed food, dopamine dense, with at best negligible information value, and at worst, corrosively negative. Still, it seems that, at least for now, enough people want this. Sora is currently invite only, but still managed to hit number one on the app store.

and invite codes have been selling on eBay for up to $45. Plus, OpenAI isn't the only one leaning into AI social media. Meta just released a new feature to its AI app called Vibes that allows people to create and share AI videos. Toby, so now that SOR has been out in the world for a few days, what are people actually doing with it? Well, I haven't been able to personally see because I'm still waiting for an invite code myself, but they clearly have broken containment.

These videos are being posted on other social media platforms and going viral. there, and they are some crazy videos. I mean, one super viral example so far has been AI SpongeBob in a Breaking Bad, you know, cooking blue barnacles under the sea with Patrick. I'll let you fill in the gaps there. Stephen Hawking ones have been going viral as well, either on a racetrack in his wheelchair or doing flips on a half pipe. And then one of the very first viral ones, too, was Sam Altman, the founder of OpenAI, stealing GPUs from Target on a CCTV camera. cause everyone to kind of say, hmm, generating these hyper-realistic videos of notable people stealing stuff, what could possibly go wrong here? So I do think one, there's that aspect of it is these

are deep fake videos of real people doing things that look very realistic. But then there's also the copyright issue when you go back to the SpongeBob example as well that they're going to have to address. Right. So let's talk about the copyright issue. The first thing that people noticed when one of the first things that people noticed when SORA came out was this is just a huge litigation waiting to happened because it was allowing users to create a bunch of copyrighted IP. You mentioned SpongeBob and they were also creating Disney characters. Disney is a very quick to sue over it to protect its copyright. And initially Open AI had this policy that was you need to opt out.

Rights holders need to opt out. So if you see your character, if you're Paramount and you see a bunch of Nickelodeon characters on there, you actually need to file a complaint with Open AI to get the taken down. So it was a ask forgiveness, not permission situation. In recent days, OpenAI, Sam Malman, has come out saying, yeah, you know, actually we don't have enough lawyers for all the copyright lawsuits that we're about to get. So we're changing it to be a little more protective of rights holders. But, you know, still, it looks like, you know, there's going to be so many lawsuits because it still seems like despite the changes that OpenAI is making, there's a bunch of copyrighted IP flowing around this platform.

And then finally, just the economics of SORA don't necessarily make a lot of sense yet because these videos take a ton of compute to produce. and the vast majority of them are not going to be viral, and they're certainly not going to be revenue producing. So what are you doing? You're just syncing a black hole of compute into this app right now that has no real monetization strategy going forward. Like, how are you going to monetize AI slop going forward? So very interesting.

Maybe you have to also start sharing revenue with rights holders, which would dent profitability even more. So just the GPU cost in general, not even to mention the litigation costs that are likely coming down the pipeline, Maybe Sora was a very expensive example of, you know, move fast and break things that Silicon Valley likes to preach. But maybe the break things, a portion of this is going to be a lot worse than Altman actually calculated. And then there are existential questions about what this means about the future of social media, because this is really the first social media app that explicitly is geared toward only exclusively fake AI videos.

None of these are real. And we've seen a shift in social media over recent years from sharing posts about your life. hanging out with friends to something that's more of like a TikTok, Instagram Reels, now algorithmic feed, watching videos that you of people you don't really know. And maybe this is the next logical evolution of that. It's you're not just watching videos of people created by people you don't even know. But now it's, you know, completely fake videos. And the Financial Times kind of went viral a few days ago when it pointed out, it looked

at some research and found that time spent on social media peaked in 2022 across, the developed world, adults are spending an average of two hours and 20 minutes per day on social platforms as of 2024, which is down by almost 10% since 2022. We'll see what SORA means for the future of social media that was already in decline. Up next, we're going to go to my winner of the weekend. It's time to refresh your yard during spring backyard days at the Home Depot. Get low prices guaranteed on propane grills starting at $179 like the next grill three burner gas grill, or get $50 off a select Weber Spirit Grill and bring big flavor to your backyard.

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For only $250. Get more value on the under $3 menu. Limit time only. Prices and participation may vary. Prices may be higher for delivery. My winner of the weekend is smaller portion sizes because restaurants from Olive Garden to Cheesecake Factory are serving up entrees that aren't leaving leftovers. Olive Garden is testing out a new section of lighter portions at about half its restaurants, where they offer the exact same food but in smaller sizes and at reduced prices. Customers loved it, with an internal affordability metric jumping 15% as designers felt like they were getting better bang for

their breadstick. It's a sentiment that other diners are sharing, too, with the National Restaurant Association's annual survey finding that 74% of customers say they want smaller portions. Part of the shift comes from a change in eating habits. Sixty-four percent of customers say that they are replacing three traditional meals with more snacks during the day. And a cheesy eggplant, Parmesan, doesn't necessarily feel like a snack. Restaurants are adapting to the new normal. The Cheesecake Factory launched a bites menu, which serves small portions under $10.00. to try and appeal to budget-sensitive diners who still want to go out to eat. P.F. Chang's also overhauled its venue to offer entrees in two portion sizes,

traditional, aka really big and medium. Neil, it's part of this larger shift in the American eater post-COVID, where more people are grazing throughout the day, eating solo, and generally looking to avoid these massive sit-down feasts. We've become a nation of birds. And there's this bar that me and you used to go to, Clinton Hall. I don't know if you notice, in April, they introduced something called, a teeny weenie mini meal and for $8 you got a bite-sized burger and fries paired with a miniature

beer, margarita or wine and something you didn't necessarily mention is perhaps why these restaurants are offering lighter portions and that is GLP1s the guy who owns Clinton Hall said that everyone he knew was on gLP ones like ozempic or we govi and so that is another reason why he said well we need just to make our portion smaller because my friends who are on this aren't eating as much, and 8 to 10% of Americans are now taking GLP-1s, according to a survey from Pricewater's House Cooper's back in October 24. So there's a lot of different trends influencing restaurant menus here, and it just seems so distinctly un-American to order something a little bit smaller at places like Olive Garden

and Cheesecake Factory, which are just known for their size and scale of their breadth of menu, as well as their portions. But it looks like this is just a sign at the time. Yeah, Darden's CEO, which owns Olive Garden said that, Maybe our customers evolved that you don't need to have uneaten food on their plate to feel like you've gotten good value. It basically is when you have a clean plate, you actually do feel like you paid what you were hungry for. Not necessarily. You don't need an eggplant parmesan that is sprawling and covering the entire plate right now.

So maybe it's less about abundance, which again, it feels almost anti-American to say it's more about fill and the satisfaction. If you feel like you've eaten your fill, then that is something that you will leave happy from the restaurant. Also, these restaurants, whether they like it or not, are competing on value now with fast food chains, with quick serve restaurants like Chipotle, et cetera. And so even if you have much larger portion sizes, really what customers want is value. And so when you're competing with McDonald's, obviously a $10 meal makes more sense than a $25 meal. So fascinating how this has just become the de facto norm. Like every big sit-down chain that you used to go to with just overwhelming portion sizes, now you can also find. a subsection of the menu saying like, hey, if you want something a little lighter, this is the section for you.

They have a word for that, and that is called the kids menu. And there's a survey by Lightspeed Commerce published back in August that found that 44% of U.S. adults are ordering from kids' menus, citing lower prices and portions that are more satisfactory to what they want. But here's my question. Should adults be able to order from the kids menu? No, probably not. I mean, I think that the restaurants have figured this out, though, and call it the biked portion of the menu, don't call it the kid's menu. The final thing that we did initially touch on

is people are eating alone a lot more. This has been a trend that we have spoken about onto this show in the past. And so when you sit down alone at a restaurant, you don't want a family-style meal just for yourself. You want like the smaller portion sizes. So just fascinating how all these different trends feed into this one mega trend

of portions getting a little bit smaller. I think a lot of people would say this is probably progress for Americans to not just stuff ourselves with food all the time and leave a lot of waste. Okay, it's Monday, so here's what you need to know to stay ahead in the week ahead. Hope your bench is informed because the new Supreme Court term starts today, as it always does, on the first Monday in October.

Over the next few months, the nine justices will consider several disputes centered on President Trump's power over the economy. Circle your calendar for November 5th, when SCOTUS will hear a case on the legality of reciprocal tariffs in January when the way if Trump can fire Fed Governor Lisa Cook. Yeah, a big show down here. a lot of Trump's big ticket, you know, constitutional issues are up on the docket this time. So some of these policy initiatives are just going to come to a head. We're going to see if, you know, the tariffs can stay.

We're going to see if Lisa Cook is on her way out or not. So it seems like a lot of the bedrock of Trump's economic nationalism is up for debate right now. We'll see how it all shakes out. Tomorrow is the two-year anniversary of October 7th, and the Israel-Hamas war is closer to ending than at any point since that date. Today, the two sides will begin mediated negotiations in Egypt after Israel accepted and Hamas partially endorsed President Trump's 20-point plan to wrap up the war, which includes a swap of all of the Israeli hostages in Gaza for Palestinian prisoners held by Israel. U.S. Special Envoy Steve Wickhoff and Trump's son-in-law, Jared Kushner, are traveling to Egypt to take part in the talks. As for economic data releases, there won't be much because the government is still shut down and all reports are on hold. Instead, investors will try to hunt for clues about the economy in the Fed Minutes released on Wednesday, the University of Michigan Consumer Survey on Friday, and a fresh earning season. Pepsi, Delta, and Levi's are the big names to report this week, while the big banks get going the week after.

I think it's funny. We're fighting over Scrapture. We're looking at Fed Minutes in University of Michigan Consumer Settivet Surveys and Levi's to try to piece together a piecemeal approach to the Jobs Report, the Thinking Man Jobs Report, if you will, Levi's, Pepsi's, and Fed. minutes. Over in sports, MLB's divisional playoff series are underway in the National League. The Cubs are down one game to the Brewers, and the Phillies are down one to the Dodgers. In the American League, the Blue Jays are thumping the Yankees, and the Tigers and Mariners are all square. Meanwhile, the WMBA finals rolls on in the Sunbelt series. The Las Vegas Aces have a two-zero series lead on the Phoenix Mercury. And finally, the NHL regular season begins tomorrow night for all you hockey fans. I just want to talk about my baseball fandom for a little it because not really a baseball fan, but I did go to the Yankees Red Sox game, and I

rooted for the Yankees, mostly because I have some friends, including you who are Red Sox fans, and I just like to be different. And it turned out well in that series, but then the moment I became a Yankees fan, they have just gotten the doors blown off by the Blue Jays. So I am a jinx. I will admit it. If you want your team to, or if you want your opponents to lose, feed them me, send me an email saying which team you want me to root for. I will root for them and they will lose going forward. So the reverse Toby Jinks is back. All right, that is all the time we have.

Thanks so much for starting your morning with us and have a wonderful start to the week. If you have any feedback on today's episode, send a note to Morning Brew Daily at MorningBrew.com. Let's roll the credits. Emily Milliron is our executive producer. Raymond Lou is our producer. Our associate producers are Olivia Graham and Olivia Lake.

Hair and makeup is waited for that Nobel Prize call. Devin Emery is our president and our show is a production of Morning Brew. Great show today, Neil. Let's run it back tomorrow.