Morning Brew Daily - Reddit Goes Dark & Netflix Password Sharing Lockdown Skyrockets Subscribers

Episode Date: June 12, 2023

Episode 79: Neal and Toby explain the drama that has led thousands of Subreddits to go dark on Monday. Plus, how the collapse of a portion of 95 in Philadelphia impacts travel and business and how Netflix subscriber numbers have skyrocketed after their password sharing lockdown. Also, which billionaire has handed over his empire to his son? Finally, why this person spent 100 days under water and what we are watching for this week. Listen Here: https://link.chtbl.com/MBD Watch Here: https://www.youtube.com/@MorningBrewDailyShow Learn more about your ad choices. Visit megaphone.fm/adchoices

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Good morning brew daily show. I am Neil Fryman. And I'm Toby. Howell? On today's Monday morning pod, Philadelphia has got some major highway problems, not even gritty can fix. And the Unabomber died. We'll explore why he's kept his grip on the American consciousness decades after he sent his last bomb. Then we'll dig into the high-stakes game of chicken going down between Reddit and its users before checking in on how Netflix's crackdown on password sharing is going. Neil, it's Monday, June 12. Let's rock.

All right, Neil. We're back. It's Monday. Give me one quick highlight from the weekend before we get into the news. So I went to a concert at summer stage in Central Park, which is a really cool venue. It reminded me of the Globe Theater a little bit. Just kind of very tight. There are some stands around and you can bring your blanket, have a little picnic. Concert was great, beautiful night. It's free, yes. So it was all in all a good time. What struck me the most was how much. liquid death people bought it's such a a staple of the concert culture right now I had no idea I know did you did you have some no this is just a for people who don't know what liquid death is it is water yeah in a can with a very menacing branding that's all you need these days you just need some some fun branding and they can sell water my highlight was I slept until 10 a.m. Wow impressive that's a big deal I will say it comes with an asterisk though because I did wake up at

4 a.m. accidentally. But other than that, the six more hours of sleep, primo. All right, Neil, great weekend. Excited to be back in the studio with you, though. Let's jump into our top story, which takes us to the world of social media. Reddit, which is home to some of the most dedicated internet goers out there, is facing a huge user-mobilized backlash against some recent changes the company made ahead of its planned IPO. When I say huge, I mean huge. Starting today, between 3,500 and 5,500 subreddits will go dark for the next two days. That includes five of the top 10 biggest subredits on the site. So what has everyone up in arms?

Well, the IPO Reddit is gearing up for, has the company leadership trying to make its financials look a little beefier. Part of that means they want to charge third-party apps for accessing the company's API or its application program interface. If I had to sum up an API in a couple of words, they are essentially a way for two apps to talk to each other. And Reddit has always allowed other apps to talk to it for free. But now they plan to charge some of those bigger apps built on the back of Reddit for using Reddit. And those costs could rise as high as 20 million per year in some case.

So it's not exactly chump change. This has rubbed a lot of people the wrong way. So they mobilized this big blackout campaign with the goal of hurting Reddit's traffic. Neil, this is putting Reddit in a real rock in a hard place kind of in before their IPO. Yeah. I think what really hit home for people was when this developer named Christian Seleig who created this app Apollo. And I didn't know this about Reddit or the Reddit ecosystem, but there are third party apps that people use to look at Reddit that aren't the Reddit app because it was kind of late to the game. So people built these apps around that you can see Reddit. and Reddit has a famously janky user interface where it's kind of hard to read stuff.

So they created, like, there's Apollo is, I think, the most popular one. There are other ones. And he wrote this blog post and said, look, they are charging me now $20 million a year to run this thing. I do not have that money at all. Like, it's, you know, this is not a huge operation. Right. So I need to shut down. And then a bunch of the other Reddit apps, like Apollo, also said they were shutting down.

Yeah. And then he and the Reddit CEO got into this crazy war on words, and they're all like calling each other names. And so it is a complete lack of trust between Reddit leadership and its users and its moderators that kind of make its ecosystem flourish. Yeah, the CEO did an AMA, which isn't asking anything. It's an absolute staple of Reddit culture. And every single answer he responded with got instantly downvoted into oblivion. Reddit uses upvotes and downvotes. And it was crazy.

Before it could even be posted. It already had 2,000 down votes. So yeah, it just illustrates how little trust there is between leadership and Redditors right now. I also was digging into some of the comments across the internet and seeing what the reaction is. And people are going even further than just blacking out and not engaging in these popular subreddits.

They're also advocating for people to delete their entire account and delete every contribution you've made to Reddit. So there's these apps. that allow you to kind of wipe your internet history completely. And they're like, without us, Reddit is nothing. So I could see this snowballing into a really, really bad, slippery slope for Reddit. So we'll see if that happens. Yeah, it is.

I think it was a communication problem because the Reddit CEO came out and said, we are going to start charging for our API access for AI companies. So Microsoft, Google, like the huge tech companies of the world use Reddit conversations to train BARD chat GPT. And he's like, we probably shouldn't be giving all of this data away to Microsoft, which is worth upwards of almost $2 trillion now. And so all of the regular editors were like, okay, that makes sense.

Like make your money on the big boys. The big boys and leave us alone. And then it turned out that the regular guys were getting hammered too. It's very similar to what Musk is doing at Twitter. He revoked free API access. for for developers to build on and you know you have these like public transportation agencies that use twitter data for a lot of things and honestly morning brew used twitter API to let us know when someone was mentioning us on twitter it was a very valuable piece of information because we

could see what articles were trending and what people were saying about our articles that channel has gone completely silent which has been very frustrating for me but we're not going to pay musk uh you know tens of thousand dollars each year now we got to do it the old fashion way and just scroll through forever yeah but my big takeaway is there's if there's one internet community you do not want to piss off it is redditors so hell is coming for them and we'll see how how it plays out we'll see if they blink we'll see if uh huffman who's the CEO blinks okay uh to intro our next story i want to give a little personal anecdote so before i started at the brew which seems like decades ago um i lived in philadelphia

Philadelphia, and I commuted up to Princeton, New Jersey for work, and my route took me along an elevated stretch of Interstate 95 in Northeast Philadelphia every morning near Cottonman Avenue. I remember it very well. Well, if I did that commute this morning, I'd have to find another route because a whole chunk of I-95 in northeast Philly collapsed to the ground yesterday morning after a tanker truck carrying flammable cargo caught fire at around 6.30 a.m. So now, if you look at pictures, which you definitely showed, there's this big gap of concrete where a highway used to be, and I-95 is closed on this stretch until further notice. Somehow, this is the craziest part, that there were no immediate

reports of injuries from this huge slab of concrete, just collapsing to the ground from an elevated highway. So I just want to emphasize, this is a very busy highway that's close to the city center, and it's likely the most trafficked highway in all of Pennsylvania. About 160,000 vehicles travel on this road each day to go in and out of Philly. They're going to need to find another route. It's a main artery. The videos coming out on Twitter over the weekend were absolutely absurd. Some of the jokes being made were like classic Philly making their own air quality problems

after New York just went through its own air quality issues. But yeah, like the videos were apocalyptic. The huge stretch of highways gone. But Neil, this is kind of your road. So give me some of the details. It's my road, baby. How much does this cost? How much is it going to cost?

And how big a deal is it? It's tough to say how big of it deals it yet. They said it would take months to repair. So they are beefing up septo, which is the regional train system in the greater Philadelphia metro area. And people are just going to have to find other routes. Luckily that for the big rig trucks, they go from to travel from like Delaware through New Jersey up to New York City.

city along 95. You don't really go through Philadelphia. There's this stretch of the Jersey turnpike through South Jersey that kind of skirts all of this. And South Jersey people know what I'm talking about. I've just been on this road so often. So it really affects people in the Philadelphia area. But I 95 in general for people, I know we have a lot of international listeners and people who don't may not live on the East Coast. This is like the goat of all U.S. highways, sees more vehicles traveled than any other road. It runs north-south from south, south of the south of Miami all the way up to the Canadian border in Maine connects major cities like DC, Baltimore, Philly, New York, up near Boston. This is crazy. This shows how just how dense the route is.

Only five of the 96 counties that runs along are rural. So it passes by about 110 million people. And by carrying all of these people and goods, it facilitates 40% of US GDP. Wow. Okay. According to the I-95 Corridor Association, which I guess is like, That sounds like I-95 propaganda. It might be I-5-95 propaganda, but if you drive along this and you see all of the economic activity along, passes by huge ports like the port of Newark, where they're just taking goods from, you know, overseas and, like, shipping them out to warehouses. So we'll see how this, you know, affects economic. Yeah, we might be getting some carmaged and we'll see if traffic goes crazy, but hopefully it does not. All right, Neil, thanks for my I-95 education piece right there.

But let's move on to Netflix. Neil, not all decisions companies make for the sake of maximizing profits backfire as spectacularly as Reddits. In fact, a recent one made by Netflix seems to be paying off big time. So Netflix has been cracking down on password sharing. They rolled out more stringent rules internationally before bringing it to the U.S. in the past few weeks. Well, we have some data on how users are reacting to those crackdowns. And turns out a lot of them are paying for Netflix now. Data analytics firm Intenna released a report that showed a huge jump in U.S. subscribers for Netflix

right as password sharing started getting curbed. On May 26 and 27th, it saw close to 100,000 daily signups and average signups from that period May 23rd to May 27th were 102% higher than its 60-day average. That's an even bigger spike than in the signups from the initial phase of COVID lockdowns in March of 2020. So Neil, it looks like this crackdown is working for Netflix. Yeah. I mean, I was thinking about whether this is really going to move the needle in any way. Like, is this kind of just like a lump sum payment that you get?

And then it's because there's, it's not going to change the long term growth trajectory of Netflix, right? Well, I mean, you're just like recouping costs that you should have had at the beginning. And everyone's going to sign up who hasn't signed up already. and we're kind of like using another person's account. I think it shows that people really have FOMO about Netflix. Netflix still drives like a huge amount of the cultural conversation. You want to be watching the show that everyone else is talking about.

And so I do think this is going to be kind of a slower burn where you want to stay in the loop on Netflix and if you can't watch anymore, piggybacking off your parents' account or actually last time I said that people were piggybacking back off their parents' account, a lot of people said, uh-uh, my parents are picking off my account. So whichever way you have it, I do think more people are going to start paying for Netflix. It does show the cachet of Netflix. I agree. And this was just one part of a like a dual pronged effort to recoup some cost boost subscriber growth in this age of like the streaming wars of a little austerity there.

So the other prong was this ad plan, which I think was $6.99 a month that they rolled out recently. That also is going really well. The plan attracted nearly five million monthly active users across the globe in the first quarter. And also, these users are actually more generative to the company as well because they pay a subscription fee. And then there's ads on top of that. So it's kind of strange that Netflix did not do this for its entire existence. They resisted it. And then these two things.

And the U-turn on password sharing too, because in late, you know, only a few years. years ago, they were saying stuff like love is sharing your password. Netflix is having a fantastic year, up 25% in the last month and 129% for the year. So the changes they've been making have been working. The key will be whether they can turn the money that they're getting now to funnel it back into content and create the next stranger things that will create more organic growth than these kind of, I don't want to say the password like gimmicks. I'll just say it.

Making money is making money. All right, Neil, before we jump. into the next story, we're going to take a quick break. 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 3-burner gas grill, or get $50 off a select Weber Spirit grill and bring big flavor to your backyard. Then set the scene with Hampton Bay string lights that bring it all together. Shop spring backyard days for seven days at the Home Depot.

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All right, Neil, it's Monday, which means it's time for us to hit our Monday segment, who won the weekend, where we look back at someone who had an extra solid weekend. Although, remember, I slept until 10 a.m. yesterday, so it's tough to think about anyone who had a better weekend than me. But I'm up first, Neil, and my winner of the weekend is Dr. Deep C. who just completed a stay of 100 days living in an underwater hotel, which says, the world record for most consecutive days living underwater. First of all, epic nickname Dr. DePsee, but his real name is Dr. Joseph Dutri, and he's a biomedical engineer who teaches at the University of South Florida.

He said that the goal of his stay was to study the effects of underwater living on the human body. There's still a lot of research to parse through, but he and his team are specifically looking at how pressure might affect the body, and especially how it might reduce the effects of aging. jury is still out on all that data, but so far the one conclusive piece of evidence from the study is that Dr. Deep Sea shrank. He came out a full half inch shorter than he went in. And Neil, I feel like the whole underwater living part, isn't that crazy? It's the fact that he stayed in confined, isolated environment like an underwater hotel for 100 days. That was truly surprising to me.

It's really impressive. I've become a lot more claustrophobic recently for some reason. I felt like five years ago I probably could have pulled off maybe a week down there. Yeah. But now I don't know. I just like my brain goes in weird places in very confined spaces. So I do not think I would last more than three hours down there. What about you? I wouldn't last very long either.

And I actually, this hotel, underwater hotels in Key Largo, Florida, I've definitely seen it before because if you've seen those YouTube videos of I stayed in the underwater hotel from like a Mr. Beast or like a Ryan Trahan or something, this is the hotel. that all of them used for those underwater stays. So this kind of has like a cult following in certain YouTube circles. And also the previous record of 73 days was also set at this hotel. This is the premier undersea hotel in the world. Dr. Gep C. Love him.

Let's go to my winner of the week, which is Alex Soros. This guy is 37 years old and he just got handed the keys to a $25 billion empire. That empire belongs, of course, to his father, George Soros. Soros, the left-wing billionaire investor and philanthropist. Unlike Logan Roy, Soros actually made a decision on a successor, and this weekend announced that his youngest son, Alex, will succeed him in leading his nonprofit, open society foundations,

which is this massive force in the philanthropy world. It gives $1.5 billion a year to causes advancing human rights and democratic governments around the world. The succession story is kind of spicy because another of George's sons, Jonathan, who's 15 years older than Alex, was seen as the likely successor to take over from his dad. They played tennis together. They were super chummy.

But apparently they had a falling out. And then Alex won the trust of George. What is he going to do with the money? Everyone is asking. In an interview with the Wall Street Journal, Alex said he was even more political than his famously liberal dad. And he's going to be focused on spending money on more domestic political issues, such as improving abortion rights and gender equality. but he differs from other young lefties in other ways. Like he thinks that, you know,

college campuses are a bit too woke and they stifle free speech. But he's my winner. He just went a high-stakes succession sweepstakes. Now he has a big piggy blank to play around with. I know. And it was interesting because a lot of people doubted that George Soros would ever give up kind of the keys to his empire while he was alive. And it is funny that these things keep happening while succession is in vogue.

So, of course, we're going to compare it to it. And yeah, I mean, this is, the Soros name is obviously one that everyone usually jumps on. So good luck, Alex. Good luck dealing with the pressure that comes with that. I know when I'm in my mid-30s, I hope I'm not having to speak for a $25 billion organization. So good on you, Alex. All right. Let's move on to this other piece of news from the weekend.

Ted Kaczynski, who's also known as the Unabomber. He died by suicide in prison. and on Saturday, according to the Associated Press. He was one of the 20th century's most notorious criminals, domestic terrorists who killed three people and injured 23 by mailing homemade pipe bombs from 1978 to 1995. What a backstory here. I think this is what grips people a lot about this guy.

He was a math prodigy who entered Harvard at age 16 and was published in academic journals. When getting his Ph.D. at Michigan, a member of his dissertation committee estimated that only 10 or 12 people in the entire country understood his topic. But something snapped. He moved to this shack in Montana where he started a bombing spree. He appeared to be motivated by this philosophy that everything went wrong for humans since the Industrial Revolution and that modern tech and scientific advancements have led us to become slaves to machines. So all that progress had to be unwound. And his targets were somewhat consistent with that philosophy, even though they seemed random. He bombed airplanes was a big target. He targeted the president of United Airlines,

the owner of a computer rental store, an ad executive, and a timber lobbyist. How he got caught is very fascinating. He wrote this 35,000 word manifesto explaining this anti-modern society philosophy. And it was published in the Washington Post and the New York Times because the FBI said, you should do this because they think he would stop doing it. And it would lead to clues to help his discovery. So his brother was reading this and he recognized his writing style and tipped off authorities who nabbed him in Montana in 1996. And that is considered to be one of the most expensive and biggest manhuts in the history of the U.S. That's my favorite detail from just the Unabomber story is that, yeah, the publishing that manifesto led to his capture. And I was

thinking, Neil, if you go rogue and pen a manifesto, I assume millions of people would recognize your writing style since you have written the brew, or at least your brother. So, yeah, just interesting to see kind of the cultural grip that the Unabomber has maintained on society, especially the youth, especially technologically savvy youths. Like TikTok has this whole Unabomber subculture going on in it.

And then the 2017 docu-series from Netflix called Manhunt Unabomber also just kind of reintroduced him to another generation of people. Again, there's Netflix kind of dominating the cultural conversation. But it is so ironic, too, that these conversations are playing out on technology, facilitated by technology, which is the very thing that Unabomber was kind of against. So very interesting to see how he's just still culturally relevant to this day. Yeah. And people say that we shouldn't ascribe so much to his philosophy and what he was saying and what, like, his motivations because he was kind of diagnosed as a paranoid schizophrenic. So he may not be fully there and competent in, you know, putting together a coherent political ideology. But yeah, people have just been like on Discord and Reddit and TikTok, just like kind of holding him up as this heroic figure on both the far right and the far left.

So I assume we are going to see documentaries about him in years to come. Let's move to our final Monday segment where we preview what you can expect the week ahead. Tomorrow's going to be a biggie. Trump will surrender to authorities after being charged. charged last week. He's going to be arraigned for the second time this year, this time in a Miami courthouse. And we know how this goes by now because we saw what happened in New York. He's going to turn himself in at the courthouse, and the judge will read 37 counts Trump has been charged with relating to his handling of highly sensitive documents at his Mar-a-Lago estate after he

left the White House. So Zoo in Miami on Tuesday. The biggest economic news of the week is definitely this Federal Reserve meeting, which happens tomorrow and Wednesday. And the Fed is expected to do something it hasn't done in the last 15 months, which is not raise interest rates. Let's go. The Fed thinks it might be time to hit the brakes to wait and see how all the previous interest rate hikes have slowed down the economy and are filtering through things like mortgage rates and bank loans and things like that. There have been some economic slowdown hiccups, like the regional banking crisis and, you know, other negative effects. But overall, the labor market has held really strong.

So people don't think this is going to be the total end of rate hikes. But it might be a pause just to kind of take a breath, see what's been happening over the last 15 months. We need a breather. Thank you. Thank you, please. All right. And then to the sports calendar, it's a big week for sports. The Denver Nuggets and the Las Vegas Golden Knights are closing in on championships.

And then the U.S. Open for Golf tees off on Thursday. This is the first major since Live and the PGA tour announced they were linking back up in a move that really shocked the world and had all these geopolitical currents since the new venture is going to be backed by $3 billion of the Saudi investment fund. Who knew golf was going to create so much, so many storylines for us. But, yeah, going to be watching the U.S. Open. I also love the rough videos just showing how deep the rough is going to be. Is that rough going to be? Oh, it's always deep. so I'm expecting carnage as well.

And then on Friday we got Wes Anderson movies. So is that going to, sorry, I'll just explain. West Anderson's Asteroid City is coming out in select theaters on Friday. West Anderson has been a huge trend on TikTok. People are making videos in his brand and his particular style. Is this going to increase or decrease the amount of West Anderson content? Well, I think it's going to increase sales to Asteroid City because, again, He kind of experienced not a revival.

Like Wes Anderson's always been popular, but especially with the youths and the TikTok audience. So I'm kind of expecting this to be one of his biggest movies ever, just from a commercial perspective, because of the TikTok machine and what it's done to his brand. All right, you heard Toby. And then Saturday, or Sunday is Father's Day. So start thinking of ideas.

Thank you. That is our show. Thank you for everyone who wrote in with personal finance. Questions for Money with Katie. Great questions. Great questions. we're actually going to record that later today. So we will get back to you, your emails.

Just be a little patient. And thanks again for writing in. If you want to write in in general, you can send us a note at morning brew daily at morningbrew.com. Huge shout out to our crew for making the show happen. Emily Milliron is our editor and producer. Samantha Velas and Raymond Liu are the associate producers. Yucenoa Ogu is our technical director.

Billy Minino is on audio. Hair and makeup has gone underwater to break Dr. Deep Sea's record. Good luck. Devin Emery is our chief content officer and our show is a production of Morning Brew. Great show today, Neil. Let's run it back tomorrow. Until that. Pay off your home, travel for life, drive a Ferrari. In celebration of the world premiere of the Monopoly Big Board Buckslot machine by Aristocrat Gaming, Yamava Resort and Casino at San Manuel is giving one person a $1.6 million dream package.

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