Pivot - Apple’s AI Pop, The Fate of Paramount, and Elon’s Eventful Week

Episode Date: June 14, 2024

Kara and Scott discuss North Dakota voting in favor of placing age restrictions on congressional candidates, X making likes private, and Tesla shareholders voting on Elon Musk’s pay package. Then, Apple stock is surging after the company revealed its AI plans, and Paramount’s merger talks with Skydance fall apart. Plus, a listener question on the latest drama with Justice Alito. Follow us on Instagram and Threads at @pivotpodcastofficial. Follow us on TikTok at @pivotpodcast. Send us your questions by calling us at 855-51-PIVOT, or at nymag.com/pivot. Learn more about your ad choices. Visit podcastchoices.com/adchoices

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Just go to Indeed.com slash podcast right now and say you heard about Indeed on this podcast. Indeed.com slash podcast. Terms and conditions apply. Need to hire? You need Indeed. Hi, everyone. This is Pivot from New York Magazine and the Vox Media Podcast Network. I'm Cara Swisher. And I'm Scott Galloway. Are you still in Toronto, Cara? No, I left this morning at 4.30 in the morning.

I had a delightful evening with the Canadians. That's redundant. I did. They're delightful. They're just delightful people. And they were so like, I know it sounds dumb, but they're woke in a good way, if that makes sense. They like, everything is like really kind

to indigenous people. Like wherever, whenever they do everything, it feels not performative. It's like real. So I like that. Yeah, it's virtue signaling without the signaling. It's real virtue. Yes.

They're actually, yeah, they're actually like, why wouldn't we do that? Like that kind of thing. And it doesn't feel like they're trying to impress you or anything else. I had a great time. Lots of fans there. We have a ton of fans there.

And I sent you a video from Ian from FedEx who was in the Air Canada lounge and just couldn't believe I was sitting there and he was lovely he got his wife on the phone and talked to me and how much they watch it together several people couples told me they watch it together about relationships to them. But he was lovely. And I want to say, Ian, you're a wonderful fan. And I'm so glad you came up to me today. It was great.

He loves your stuff around men and boys, especially, Scott, and parenting. That's nice. Thanks for saying that. Yeah, it was nice. It was a lovely trip to Canada. Very quick, but fast. And I have a giant new award, a bowl that I can put fruit in. It's lovely.

It's really nice. I think I've told you this. Every year I can put fruit in. It's lovely. It's really nice. I think I've told you this. Every year I give my dad something off his bucket list, and every year he chooses the same thing. He wants to go to opening night of the Habs versus the Maple Leafs at the Air Canada Center. Oh. And I've never seen my dad cry, but he cries every time the bagpipers come out on the ice in the Toronto Maple Leafs game.

And then he takes me to this weird part of Toronto and to an apartment building and then points up and says, see the apartment two down from the air conditioner? I'm like, yeah. And he's like, that's what you would have conceived. Oh, you're kidding. And I'm like, well, that's awkward. That's awkward.

Thanks, Dad. So I came very close. I'm like- Did you go in? Did you buy the apartment and make it a shrine to yourself? Yes, I could see where my mom and dad conceived me. You know, once I walked in on my parents having sex. I didn't want to think about that.

Hold on, hold on. I can tell you, it was the most awkward 45 minutes of my life. That's good. I knew that was going somewhere. Did that actually happen? Yeah, no, my dad, I was conceived in Toronto, and my dad reminds me of it every time we go up there. No, I mean, did you ever walk in on your parents?

That's what I'm asking you. Oh, that's a little pervy. No, I didn't. I don't think. Either that or I suppressed it. Only because I just interviewed Griffin Dunn, and there's certain sections where he talks about that issue of walking in on people having sex. No, we're very open about that stuff in the Galloway household. I went into my son's room the other day to have the sex talk, and I brought in a condom and a banana, and he said, what's the banana for? And I'm like, well, I can't get hard on an empty stomach. Oh, my God.

The hits keep on coming. Oh, God. The hits keep on coming. of my own. When I came back from, Louie and Alex had been very open with me about lots of stuff. And I got back from a trip once and I said to Alex, I was young, but I go, what'd you do today? And he goes, well, Louie taught me to masturbate. And I was like, oh, good. How old was that? How old was that? I don't know. He was a kid. I don't know. He must've been eight or nine. Louie taught me. Thank God for brothers.

How old was that? I don't know. He was a kid. I don't know. He must have been eight or nine. Louie Tommy. Thank God for brothers. I know. I was thinking, thank you, Louie.

So now I'm going to have Louie and or Alex teach Saul how to pee outside. That's a big skill for men. Just, you know, that's one of the great luxuries of being a man is peeing outdoors. I mean, that's really, it feels very primal. Yeah. Well, we've got a lot to get to today. Let's stop talking about masturbation and parental sex. As we speak, the Supreme Court has ruled against a bid to restrict access to abortion.

Very important ruling by the Supreme Court. It's not our biggest area of expertise, but important. I'm glad the Supreme Court did that. We're still waiting for the immunity ruling by them, whether Donald Trump gets brought or some immunity. But we've got a lot of other things to get to today. Tons of tech stuff and media stuff. Apple stock blowing up after the big AI announcement. Sherry Redstone deciding at the last minute to kill the Paramount Skydance merger. And a lot of other stuff, including 900 things from frigging Elon Musk. But anyway, we got to get to them.

But just to comment, just real briefly, because of this podcast and because of this, most recently, the TED Talk, I got invited to. So Jeffrey Sonnenfeld, literally no one pulls together a more. Those are amazing, aren't they? Powerful group of people. And then he choreographs the thing such that it's honest, but civil. I mean, this guy is adding. I think maybe with the exception. Yeah, he's a the exception character too yeah oh he's and he's funny maybe with the exception of jonathan knight i think jeffrey sonnenfeld is the most influential scholar in america right now who's really

using his platform for good anyways he invited me and we were talking about uh um tech regulation i mean literally care i'm not exaggerating the most important people in the world on this oh and then he pops them out like suddenly bob eiger Bob Iger, come on in from the video. And you're like, what? Yeah, no, but he goes, he goes, Scott, you're never happy with anything. What would you like to say to, you know, and I'll fill in the blank, your imagination, because it's Chatham House rules. And I was sitting there thinking, you know, pretend that tech is medical abortion and you'll get all over it and regulate it like crazy immediately.

Just pretend it's some sort of technology that is essentially medical abortion and I have no doubt you're going to move on it really quickly. But anything else, you seem to just sit on your hands and come up with thoughtful comments about liberty. Yes, committees. And profits. But anything else? You seem to just sit on your hands and come up with thoughtful comments about liberty.

Yes, committees. And profits. And anyways, it strikes me that the only technology that Baptists just decided that IVF is fetal personhood. And so they're going to the mat with getting more and more restrictive. So there's going to be a real fight around these issues because they're emboldened by Donald Trump, by the rulings of the Supreme Court to really go for taking all rights away. So good for the Supreme Court for letting women have just a slight amount of choice. They're also going after contraception and everything else. But anyway, let's get to some of the other stories. This is interesting for you. North Dakota has voted in favor of placing age restrictions on

congressional candidates. The amendment, which passed with a 61% approval, would ban congressional candidates from running if they would turn 81 years old by the end of their term. The measure is the first in the nation to impose age limits on congressional candidates and is expected to face a court battle. Really interesting is there's age limits on running for president.

I think it's 35. And Senate and Congress, 30 and 25, yeah. They may be able to overturn it because of court things. What do you think of this? You love this idea, I assume. Oh my gosh. I mean, one in three people over the age of 85 has Alzheimer's. And part of the thing around Alzheimer's is you don't recognize you have Alzheimer's. So look, I think that this type of delusion, dementia, and narcissism and the notion that we're going to expect people to make the most important decisions and travel the world to do multilateral trade agreements and make decisions on the spot around where do we deploy the sixth fleet given this most recent attack. I just think it's literally insane. And I think, unfortunately, the lack of term limits or age

gating on the upper end not only has cost the country a lot in the last 10 years, whether it's reverse engineering into bodily autonomy or not judges being approved as quickly as we'd like, I think it could, quite frankly, Kara, cost us the White House. Let me say the quiet part out loud. quite frankly, Kara, cost us the White House. Let me say the quiet part out loud. But I think this is long overdue. The problem is it may not be constitutional. It may be restricting people's speech. Well, why wouldn't putting age restrictions, why couldn't six-year-olds run? I mean, if they have it on the lower side, why couldn't, it's in the constitution, I guess,

so it'd be hard to take out, but- I hear you. It's not constitutional in the constitution, if that's the argument to make. The other thing, I think more of the point is term limits is probably a better way to do it, right? So that they can't, there's, term limits are age, right? If you're there for, I don't know, 26 years as a congressman, that's 13 terms, right? So you have, you know, you can only have this many terms as a congressman, this many terms as a senator. Maybe that's the way to do it. And that's not speech. It's just, you know, term limits are something that are very common, whether governors of states and things like that.

And then you're attacking the age issue without attacking the age issue, right, kind of thing. You know, I think this is a great idea. I think this is a great idea. But what age? What, 81 is the year? Do you think that's, or should it be 80? I think 81 was their attempt to make sure that no politician in North Dakota actually thought it was going to affect them. Oh, okay.

As opposed to speaking to biologists, speaking to sociologists, and speaking to the populace. What they said is, no one in North Dakota is over the age of 81, so this isn't going to piss off anybody. So what age would you have? I don't feel qualified to make that. I think 80, 80. It seems to me that, yeah, 80 seems pretty reasonable. I would probably go even younger. I don't think people, having spent some time with elected officials, I actually don't think

it's, I don't want to say it's fair to them, but it's very hard to give up power. Yeah, it certainly is. I don't think you're doing people any favors when I think their lives would get better if you said, by the way, at age 70 or at age 80, we put a medal around your neck and we wish you the best and we let you go spend time with your grandkids. I think they would be happier. I think if they were forced to leave, they could just ring the bell and be happier. Or they'd know. They'd know. The only issue is lame duckness, right?

Like when you know they're coming up against the thing that people don't have to listen to them. And so, you know, I don't know. Term limits seem to be the best way to do it. I feel like term limits. I think that's probably right. An amazing word that doesn't get used enough is churn. We need more churn in terms of our companies. We need more churn in terms of our leadership. We need more churn in terms of our

leadership. Congress people used to be people who had jobs. They'd go home and they'd come back and eventually they'd leave. Yeah. Now it's a permanent overclass. That's what it is. And now all people think about is how do I rile up my hard right or my hard left base on TikTok to raise more money by insulting the other side, which just creates more animosity and it turns into a food fight instead of a collaborative body so I can get reelected. And I think if they knew the end was coming, and by the way, I think they should make a lot more money, then you got to do one of two things. You got to create incentives here. They got to say, all right, you're coming to Congress. When you leave, you can't make any money from anyone that's ever had a bill in front of you

for three or four years. So think about it. So do you want to leave sooner such that you can make some money or pay them more such that they're not feathering their nest? But what we have now is just incredibly dysfunctional. And the fact that we have so many old people is dangerous. Yeah, it really is. One of the things that would be interesting, because companies have age limits, by the way. So it's kind of interesting that capitalism puts them in. Anyway, speaking of limits, there's someone who doesn't have any. We're going to go through these very quickly. Tesla shareholders are planning to vote on two measures as we tape on Thursday to re-approve Elon Musk's pay package worth around $50 billion and move Tesla to Texas. Obviously, we talked about the Texas Stock Exchange earlier this week.

Musk announced on X that both measures have the support they need. We'll see. We'll see. But he's saying they do. And then all his acolytes like Linda Yacaruna were like, good job, boss. As a reminder, Delaware Court ordered Musk's compensation package to be rescinded in January. The approval from shareholders not caused the legal dispute to be dismissed. But a lot of big shareholders and very important shareholders said no. You had said that you thought it wouldn't pass because two of the big firms that recommend these things. I'm going to go through all the things. You can now post likes on X in privacy in an update. The platform announced that likes will now be private for

everyone. You'll be able to see your own likes, but others will not. X is director of engineering, so the change meant to protect users' public image. Oh my God, it's a public site. And ensure they don't feel discouraged from liking edgy content. I don't understand that. And the third, well, it was four actually. Elon has withdrawn his lawsuit against OpenAI and its founders. Musk's lawsuit focused on breach of contract and fiduciary due to alleging that OpenAI had been transformed into a for-profit company. The dismissal came just one day after Musk criticized OpenAI

and its partnership with Apple and X, which are discussed threatening to ban Apple devices at his companies. We'll get into what happened at Apple soon. And a hearing has been scheduled for this week to assess the OpenAI's request to dismiss the caseAI's request to dismiss the case. I think the case would have been dismissed like the others he has. And the last

one was a very troubling article investigation in the Wall Street Journal about his sex life at SpaceX in terms of dating people at work, pressuring people, et cetera, et cetera. And it was quite detailed. And some of the women just didn't want to talk about it, and they'd signed on disclosures. So it sort of raked him over the coals for his dating at work situation. I felt it was a very sad story because, you know, he texts people late at night. It was well reported.

Any thoughts? Well, it looks like I was wrong. It looks like as of right now, both resolutions are going to pass. The shareholders have said he's added, basically, I think what they've said is he's added a ton of shareholder value. We want to keep him motivated.

We're down with this. The stuff about his pressuring people, or I don't know if you call it inappropriate. I don't know what the right words are. You deal with this a lot on boards because the bottom line is men will mistake friendliness for sexual interest and women will mistake sexual interest for friendliness. That's interesting. And what you have is a series of men who grow up in a company and become very powerful and people start laughing at their jokes and being nice to them because they have so much power over them

and they mistake that for sexual interest. And sometimes it's a consensual relationship. Sometimes over time, the person with less power feels pressure. And I think there's some nuance here, but what I've always said and advocated for from a board level is the following. Whenever you get a lot of people together in a high-pressure situation and ask them to spend a lot of time together in the pursuit of a collective objective, they're going to be attracted to each other and have sex. That's just the bottom line. That 99% of relationships that begin in work, one in three relationships begin at work. Think about that. One in three that they're consensual. And I've been to eight weddings of people who met while they were both employees at a company that I started. I think of it as a mitzvah. Young people, be smart, be respectful, be cautious.

But my view is I think it's a wonderful thing when people meet, fall in love, start a relationship, whether it's at work or not. Having said that, having said that, there needs to be a clean, sharp line that once you get above a certain level of seniority, call it VP, SVP, where you're making a shit ton of money, which means you are now very attractive to strangers outside of work, your fly boss is up and locked. And there is no excuse. There is no extenuating circumstances. There is no consensual sex.

You do not have relationships at work once you are above a certain level. Well, different companies do handle it differently. Sometimes it's, I remember, I think it was microsoft because they used to be wild over microsoft and google was google google was crazy like what was going on they're both consensual and just weird um and so what some of them do this thing called a love contract or disclosure which i think some people try to try i get it, or move people. There was one high-ranking person at Google who fell in love and married, and they had children later, but she moved out of his area of management and stuff like that.

And so it just depends, right? It's a very complex topic. It causes so many headaches. In this case, like, we broke the story about Sergey Brin and the woman at Google Glass, and, you know, he didn't get, there were no repercussions for him. And, but it was controversial for sure, because it was all kinds of controversial. But one of the things that was interesting about it is that it was so, they didn't have any, this is a big company by this time, and they didn't know

what to do, right? Like that was it. There was no clear rules or very clearly articulated things. And so, and this story, you should read it. I assume you did, but it was really, it was sad. I found it sad is what I found it most of all, like, hello, hi, hi, hi, late at night texts and things like, come over, hi, are you there? With Elon doing that, it was just, oh God, it was achingly, he's achingly lonely is what, I don't feel sorry for him, but you know, it was just a, one time I was talking to someone who was working at a startup, an HR person. And I said, what's your job there? And she said, it's my job to keep people from fucking each other. That's what she said. Yeah, but here's the thing. I don't think it's HR's job to keep young people from fucking each other. I actually think that's a good thing. But when

you're Elon Musk, you're the wealthiest man in the world. You have access to private jets, the coolest parties in the world. The bottom line is the women on the receiving end of those texts, when they're getting a text message late at night from someone they deeply respect, who has incredible power over their future, could make them millionaires, could give them unbelievable opportunities, someone they really deeply respect. If he had anything resembling a board that was a fiduciary, they'd say, Boss, you have so many opportunities elsewhere. You should never, ever put anyone in that situation. Because the woman receiving that text at two in the morning saying, hey,

what are you up to? That's just fairly fucking uncomfortable for her. Women don't need to deal with this bullshit. And here's the thing, that guy can get laid anywhere. And so when it comes to work for guys above a certain level and women, it's just, you're done. Take it off campus. Because ultimately the power dynamic can lead to very bad places that creates tremendous drama, distraction, and resource leakage for everyone trying to figure out how to wallpaper over this guy's late night missives. Just absolute. You don't do this, Elon. Text the eight women at the club last night you were doing ketamine with. Listen, he's had children with people who work for him, like babies and stuff like that. So,

and not married to. In any case, there aren't going to be repercussions for Elon for any of this. It was an interesting story, but no repercussions. Same thing with this pay package. He's behaved, you know, the company's really gone down a lot in terms of value. I think it's off 30% with the stock market up 14%. So it's really in a hole as a thing, and they're still going to keep saying, he's done it before, he can do it again. I think that's their, if they vote this. We'll see. Look, the stock market's telling you what it thinks of it, which is not much, that they don't have products. They don't have new products. Any thoughts on the post X and privacy thing? I don't know. It's a public platform and they're like protecting people

from liking edgy content. How ridiculous. I don't get it at all. What do you think? I don't get it. It's like it's a public platform. If you don't want to have a public image, don't like it. Like, why do you need to like it in private? I don't know. Whatever. I don't know. And the OpenAI thing, it's just he was going to lose. That's my feeling.

Yeah, but he doesn't use the courts as a means of pursuing justice or getting decisions. He uses the courts. Harassment. I was going to say intimidation. Just constantly finds it. It brings attention. Oh, I was wronged and they owe me money. And so, I mean, Trump does this. And he has a huge budget. He has infinite resources. Just harass them. Just threaten them. Just make them less likely to cross me again. Get my name in the news cycle. Me pursuing a lawsuit gives the signal that there's some veracity to the notion that I was wronged here. And I think all along his lawyer said,

you know you're going to lose, right? It's like that politician who used to say, they used to say to him, well, that's not true. You can't accuse him of that. And he used to say, well, make him deny it. Because forcing someone to deny anything makes the accusation seem more credible. Anyway, as usual, Elam won't pay a dime for any of this stuff. He can do whatever he wants, sadly. But let's get to our first big story. Apple stock is surging after the company revealed its AI plans at the annual developers conference. Apple intelligence will include a new AI platform integrated into operating systems, an improved Siri, chat GPT integration, and more. The new

features will be available this fall on Apple's latest devices and are expected to drive an uptick in sales for new iPhones. Shares initially dropped after the announcement, but shot up in the last few days when people really did realize what they're doing here. Apple and several people wrote some great pieces about it. Apple even briefly surpassed Microsoft as the world's most valuable company on Wednesday. A lot was made of the chat GPT integration. I think it's probably not the smallest of things, but what they're doing is they're not giving chat GPT money. They're giving them distribution.

So talk about the announcement. I think they did it as we talked about and predicted and you did saying, you know, they're going to come second and do a great thing. What is your overall feeling on this and the stock surge? So as stupid as the Vision Pro is, this is that smart. This is the best move by Apple on a number of dimensions in a long, long time. One, it's not artificial intelligence that's going to change the world. It's going to be contextual intelligence. And that is the ability to recognize, to take different assets with my permission and with the trust that Apple has and says, okay, just make my life easier and save me time so I can spend more time making money or with my family. And in typical Apple fashion, they're not first tier, but they're just going to do it better. They also, I mean, there's so much, they did so many smart things here. It's like, it sends shivers down my spine. AI has become the worst brand or one of the worst brands, worst managed brands in the world. It's become this mix of drama. Oh, it's going to kill us. Oh, it's going to save us. Mixed with massive shareholder increases, mixed with drama. It's just like this brand has become, after you listen to things about AI too much, you just want to

shower. You just get sick of it. Yeah. But what are we doing with it, I think is what you're saying. That's right. Okay. It's going to save the world. No, it's going to destroy it. No, it can tell you the history of France. I mean, okay, fine. And then Apple says, let's get away from AI and let's just call it Apple Intelligence. Which means AI. Do you get it? AI, Apple Intelligence. my photos by name and find photos more easily. It's going to let me very seamlessly add some context or flavor or something, make it sound more professional or friendly to my emails really seamlessly. I mean, it's going to upgrade finally one of the worst brands in tech, Siri. In addition to it being smart and being quintessential Apple, iteration, second mouse, thoughtful. The market realized that them incorporating chat GPT into this is purposeful and genius because what they are doing is rather than

spending the billions to develop their own LLM, they are positioning themselves to extract the second greatest licensing fee in history just behind the ability they garnered or the ability to extract $20 billion a year from Google, right? Or because of the threat that Microsoft would come in and be the default search engine, they're going to do the same thing here. And what they are setting up is the following dynamic. Hey, deepest pockets in the world, AI companies, Microsoft and Alphabet, who wants access and branding to the billion wealthiest consumers in the world? And, Microsoft and Alphabet, who wants access and branding to the billion wealthiest consumers in the world. And they are going to extract $5, $10, $20 billion a year from the AI company that gets to be on the devices of the billion wealthiest people in the world. And

of that $20 billion, $19.8 will hit the bottom line. And they are positioning themselves to be in the same position to play Microsoft. They could have a lot of them, too. They don't have to necessarily. They could have Claude. They could have Perplexity. They'll have one, whoever would be the highest bidder. And this is what the market realized.

They're like, oh, this is underwhelming. This isn't that big a deal. And they said, wait a minute. They're about to get another enormous licensing fee, which will be 98 points of gross margin. And the stock was up 10%. Yeah. I think what'll be interesting that they picked ChatGPT, you know, is integration. But, you know, one of the things, of course, Elon got wrong saying, I'm not going to let the Apple phones into my, whatever the fuck, putting them in a Faraday cage. I think they picked them because they were most in need of a deal like this,

because they're under enormous pressure to grow, although their revenues are up to, I think, over $3 billion now. They're really trying to get ahead of all the big players, but they're not paying. Of course they're not paying. It's like, can you believe it? They're not paying.

I'm like, I'm surprised OpenAI is not paying Apple, but eventually they probably will. But Apple, you know, I think if you push this OpenAI tech, it's good for everybody. And I spoke to OpenAI CTO Mira Marotti at a live event at Johns Hopkins facility here in Washington. It's part of a series.

And she didn't get into specifics, was pretty happy with the Apple deal. It's good for OpenAI. I did talk to Cook, and I think they felt like OpenAI was the farthest ahead at this moment and the best way they could integrate it using privacy issues they obviously have. But they said they're also planning partnerships with other AI models, such as Google's Gemini. So where does the stock go from here, Scott? I mean, you thought it would go down. You said it was a selling opportunity, but it's a buying. Look, after this announcement, I'm rethinking everything. And I don't like to trade stocks. I don't recommend anyone trade stocks. My advice from this point forward is just buy

Vanguard Index Fund. But there's another key observation here, and that is Alphabet and Microsoft are the most profitable software companies in the world. Apple is the most profitable hardware company. At the end of the day, despite them playing up services, they're a hardware company. And Microsoft has some hardware devices. Does Google have them? If you think about all the Vision Pro was, was a $700 million insurance policy in case the boy king, i.e. mendacious fuck Mark Zuckerberg was right about headsets. And now that we know these things make no fucking sense, we're going to let it go the way of the Hermes Apple Watch. And that is we'll put out some press releases, we'll pretend it's

an innovation, and we'll let it just die a slow death. See, I don't agree with you. I think they're going to iterate on it and move to a smaller thing and slow death. See, I don't agree with you. I think they're going to iterate on it and move to a smaller thing and a smaller thing because I think heads-up computing will be a thing. My feeling of the most interesting people here, and by the way, I would recommend everybody read Ben Thompson's Techery Newsletters. It was a great take that Apple wasn't behind on AI,

that they're a hardware company more than anything, and it's happening at the right time. Two things I think they're doing. One is they're teaching people what AI is for, finally. Oh, how can I use it? Just like when you first got internet, like, what do I use it for? And then AOL showed you what you used it for, right? This is what you use it for as a consumer. Once it starts to integrate, you're going to be like, oh, okay. Because all I get now is Google saying, do you want me to summarize this email? And I'm like, no, it's a line. Why do I want, why? Or do you want me to write this email? Maybe it's a line kind of thing. So you really start to see why it's helpful. The second thing that I think is interesting, and I'd love your reaction, is I think it changes the app ecosystem completely. and I love your reaction, is I think it changes the app ecosystem completely.

Apple is getting out of the app ecosystem. I think it'll pull from apps and then tell you things like, hey, you bought a ticket, you're going here when, would you like an Uber now? Like it will be the real gatekeeper of everything. And eventually apps will go away. You don't have to open the Uber app, open this app, open this app. I think it blows up the app economy in a way that I don't think people are seeing. You don't need the app if the phone is going to be your friend.

But it's the same dynamic we talked about that possibly that AI or LLMs reduce the need to ever go to actual media sites themselves. The same dynamic here is that the threat or the potential is that Apple intelligence could make it such that you never need to actually open the Uber app, that it registers your needs, looks into your email and says, your mother's coming into town. Do you want us to set up reservations? Do you want a car to be waiting for her? And maybe they brand it, maybe they don't. But the other thing that I think is really real genius here is that Apple's a hardware company and they need to think ahead around, you know, two miles ahead or two moves ahead in terms of who could be a potential threat to their hardware domination, specifically the iPhone. The biggest threat, in my opinion, to Apple's dominance in hardware up

until last week was that ChatGPT or Microsoft AI or OpenAI, whatever you want to call it, launched their own AI phone. And by them selecting ChatGPT, why would you ever trial a ChatGPT phone when you have a ChatGPT phone called an iPhone. So their decision to put chat GPT on their iPhone basically took away the threat of open AI with its infinitely cheap capital launching a phone. Yeah, I don't know who's a more strategic CEO at this moment, Satya Nadella or Tim Cook. I can't figure it out. I think the answer is yes. Yes, right? Like, I sat there as I was talking to him and also just thinking about it. I'm like, oh, their whole app problem goes away because they just, they're the facilitator.

And the thing is you trust them compared to other people. And they have not given up their marketing and real DNA about privacy. Like, they'll handle it for you and I would let them handle it for me, right? I trust them to do it right. And I would let them handle it for me, right? I trust them to do it right, and I trust them to do it elegantly. So they are still the biggest gatekeeper in history, really, if you think about it. Anyway, really great move. Where's the stock going, Scott?

Make a prediction now. It's had an incredible run, but I think the future of tech or the vision of tech shouldn't be artificial intelligence. It should be native intimacy. The real vision for AI that really helps people is to help them save time so that they can spend more time with their relationships and create greater connections more easily and more seamlessly with people that they care about. Is that a new thing, native intimacy? That's interesting. Well, I'm writing my post on Apple intelligence coming out tomorrow, so I'm trying to come up with all these catchphrases.

But tech shouldn't be about sending a dildo into space. It should be figuring out a way that it's easier for you to reach out to friends such that you can save time, such that you can make more money, such that you can deepen those relationships. And I think that's actually that Apple is trying to do that here. They're saving people time. It's incremental changes. It's utility. It's not, oh, I want to know more about Vietnamese history or my sinus medication.

Okay. No, I agree. I don't think you're ever going to look at the phone at some point. It's all in your ear. Her. Anyways, the Vision Pro, vastly, vastly overhyped. Apple Intelligence, underhyped.

This is the best. And not only that, moving from AI to Apple Intelligence is the best brand move of the year. Yeah, they grabbed it. They're so clever. Such a clever people. They're old men there compared to the youngins. They're showing them how it's done, I have to say. All right, Scott, let's go on a quick break.

When we get back, we'll talk about the abrupt end to the Paramount Skydance merger and take a listener mail question about the latest drama with Justice Alito. Fox Creative. This is advertiser content from Zelle. When you picture an online scammer, what do you see? For the longest time, we have these images of somebody sitting crouched over their computer with a hoodie on, just kind of typing away in the middle of the night. And honestly, that's not what it is anymore. That's Ian Mitchell, a banker turned fraud fighter.

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As a Fizz member, you can look forward to free data, big savings on plans, and having your unused data roll over to the following month. Every month. At Fizz, you always get more for your money. Terms and conditions for our different programs and policies Every month. At Fizz, you always get more for your money. Terms and conditions for our different programs and policies apply. Details at Fizz.ca. Scott, we're back with our second big story. The fate of Paramount is up in the air. It looks like Sherry's going to run it herself after controlling shareholder Sherry Redstone

killed merger talks with Skydance earlier this week, ending a months-long saga that keeps going on. I know, you know, we've talked about whether it's important or not, but it's very interesting. National Amusements, the Redstone family company that owns Paramount, said the parties have not been able to reach a deal, noting they could not agree

on outstanding non-economic terms. Redstone is now reportedly looking to pursue a separate sale of National Amusements without trying to merge Paramount with another company. I've been trying to figure it out. There's a Sony deal, Apollo deal that was sticking out there, but it was the only other one. There was a talk about a Paramount Warner Brothers merger. There were all these plans to take CBS and have Jeff Zucker and Jeff Schell run it.

That's gone. I don't know what to say. I guess David Zasloff is probably calling her, I suppose. It's such a convoluted ownership structure. And by the way, media investor Edgar Bronfen Jr., backed by Bain Capital, is reportedly looking to make a $2 billion offer for national amusements. Stephen Paul, Hollywood producer Stephen Paul, is also lining up financing. What do you do if you're a Paramount shareholder? Is there anything to do?

The shares dropped 8% on Tuesday. Thoughts? I wish Paramount would be essentially really poorly trained or have a limp and that the governor of South Dakota would just take this thing and shoot it and bury it in a gravel pit. I am so sick of hearing about the neuroses of billionaires. Do you realize, you know, this is really an interesting

and disparaging statement on America. The only people going after this thing now are billionaire children. Edgar Bronfman Jr., Sherry Redstone, David Ellison. What do they all have in common? They've all inherited billions.

Those are the three players involved in this. And then what did we- On Apollo and Sony. Well, okay. But what did we predict? Apollo's just waiting for this dysfunction to pan out. Have at it. Have at it, billionaire weirdos.

And when you're serious- I hadn't thought about that. You're right. Yeah, go ahead. And when you're serious and I hadn't thought about that. You're right. Yeah, go ahead. And when you're serious and realize these pretzel, weird, gymnastic, unnatural act deals fall apart because they make no fucking sense and they never did, we're here. Probably not at a price you like, but we're here.

And you're right. It's either going to go... I don't know if Warner can do it with their debt right now. They've brought it down quite a bit. They brought it down quite a bit. They brought it down quite a bit. He's a very disciplined executive in that regard. But this is what's happened. The company has been in play for six months.

Yeah, it's like a house. When companies are in play, their stocks go up. In the last six months, Paramount Global's stock has gone down 34% because all this drama has reflected is the controlling shareholder of Paramount is a billionaire child. And the great thing about dynasties is usually the kid fucks it up and spends most of dad's money. And usually what's interesting is the grandkid looks up and says, grandfather was a baller grand, dad was an idiot, and they make some of it back. But this is the next generation of idiots blowing their parents' money. Notice how no institutional investor is a serious

bidder here. Yeah, not yet. They're waiting, right? And again, I'm just kind of like, can we just fast forward to when this thing is put out of its misery? So let me ask you then, what is that? What is the best answer here? Because there's some very valuable media assets here, no question. It's split up. Split up and sell for parts. They give the movie company to Sony,

give the cable companies to a larger roll-up that will cut costs instead of pretending there's a future in cable. Just make Nana and Pop-Pop comfortable and cut costs faster than the business is declining

because it's still a good business. It's still a profitable business. It's just not growing. And call it a day. But Sherry, my sense of Sherry is every time the banker's kind of convinced her this is the best deal, she hangs out with Alito's wife and decides she's getting a shitty deal after a few glasses of Chardonnay and then blows the deal up. I mean, I would imagine every serious banker and every serious acquirer is sort of like, yeah, we're just kind of done here. We can't get a deal done with these people. Yeah. Oddly enough, I was talking to a very high-profile banker who is peripherally involved this week,

and they're like, this is all about personal drama. 100%. Playing out in a thing. And it's like someone needs to get a therapist, which Sherry had a very, I like Sherry. I've interviewed her several times, but it's like she can't run it herself. She just can't. She just can't. Half the board members have stepped down.

She fired the CEO. And by the way, these triple CEOs, at least two of them I understand are going to leave. They have a triple CEO situation in place. They're going to go. It looks like they're going to get out of Dodge. And they're saddled with all kinds of things. But in there is all this valuable IP, all this really interesting IP, hit shows, lots of juicy bits here. And to watch this company, Paramount Pictures was Paramount fucking pictures, right? And there are some very dynamic media companies still.

This is not one of them. And so I just wonder, it's so romantic, the idea of buying it, but it's so, like, I don't, if I don't understand a deal, I was like, you're going to buy what and sell what? What does this have to do with what's good for Paramount or what's good for CBS or whatever? You know, none of it has anything to do with what's good for the business. Whenever you're selling anything, whether it's a football team or a business, you just really want to hope that the child of a billionaire or a kid who inherited billions shows up. Again, notice how the only three people bidding on this thing right now are billionaire children. guy. Star Trek. And I was kind of like, why do you need to be? He wanted a little more power, right? And this was a short trip to that. He thought it was a short trip to it, but what a waste of his time. Go make another movie, David. Go make another hit movie. You're good at it. But look at it. This is all ego. Billionaire kids are like, I don't need money. What do I want to

do? I want to go to the Cannes Film Festival and the Oscars. And I like movies, so I get to do that. Right? And the serious investors, the serious investors are like, we'll just sit this one out until they come to us and say they're willing to sell at a price that makes sense for our limiteds. We're cursed with being grownups, and we don't have billionaire parents. So we need to act more rationally and a little bit more like see above grownups. Yeah, absolutely. Anyway, we'll see. We'll see what happens. But Bill Cohen's sure having a good time covering. He's doing a great job. Dale, come on. Tell us. Explain it to us. Probably not. We're not that interested. Anyway, you're doing a great job. You're doing a bang-up

job covering it. And it's interesting. I feel like I'm watching Succession or something. Anyway, let's get to a listener question. to a listener question. This question comes from Jamie via email. I'll read it. Hi, Karen Scott. I'm sure I don't have to tell you, but some very concerning audio was recently leaked of Samuel Alito and his wife, Martha Ann.

Ah, Martha Ann. I just have to hear your take on this. How can this stand? What can we do as citizens to get some accountability on the court? It feels like a hopeless situation when they were appointed for life and won't recuse themselves from obviously conflicted positions. Love the show and appreciate the laughs that come along with great insight. Oh, we're such a laugh riot. a woman posing as a conservative supporter. This woman cracks me up. She's done it a number of times. She did it with Jim Jordan, everything else. I want a Sacred Heart of Jesus flag because I have to look across the lagoon at the pride flag for the next month. She sincerely thinks pride flags are disgusting. I don't know. Nothing that came out of this woman's mouth,

I'm surprised by. I'm surprised it was actually a little nicer than I expected. I'm a little less homophobic, but it's pretty homophobic. But I'm not, there's zero surprise on my part by this. With him, I think he was just telling the truth that like we are in a people that are interested in Christian theocracy and people that want to have a democracy. So I'm not surprised, but I don't think it was that bad what he said. He just said the truth of his life and he does it, he does it in court too. So I don't know. I don't know.

What do you think? I'm trying to think. X, elite education institutions and the Supreme Court. I think those are the three organizations and institutions who have had the greatest fall in brand equity. organizations and institutions who have had the greatest fall in brand equity. I think possibly 24 months ago, the Supreme Court, the United States Supreme Court had arguably one of the most trusted brands in the world. And the fact that a spouse, either of them, would ever let an American flag be hung outside their house upside down,

you shouldn't be in government, much less sitting on the Supreme Court. You're an embarrassment to the rope. And a lot of this is, look, conservatives deserve to have voices on the Supreme Court. And also, all of these individuals, maybe the exception of Thomas, are, I think, incredibly crisp thinkers. When I've seen Justice Thomas speak real time, sometimes I don't think he's that sharp. Is that fair? I don't know. He was a decent legal scholar. But anyways. It is fair. Regardless of what you think, like Amy Coney Barrett or Justice Barrett,

Justice Gorsuch, these are serious candle power legal scholars. And you may not like their politics. I mean, these are just really impressive people. But you and your spouse sign up for a certain fidelity to the flag that includes not hanging it fucking upside down. And anyway, it comes back to the same thing. We need more churn. With what Alito said, I'm not surprised. He's an asshole in public. So being an asshole in private or saying these kind of things is not any kind of surprise to me. Like, zero surprised me about her. She sounds like a really unpleasant lady who just has all

kinds of problems that she needs to, well, she's never going to change. So, she is what she is. She's kind of a, like, I don't like the pride flag. Oh, no, good heavens. It's a very pretty flag. You know, whatever, whatever, Martha Ann, you can do it, but you're flag. You know, whatever, whatever, Martha Ann. You can do it, but you're right. You know, when he was saying, I can't control my wife, he has to not control her, but he should sit her down and say, you know what? I have a job that means you have to behave a little better, right? And the fact that he's like, I don't know, what can I do about it? You know, we're different folk.

It's just ridiculous. I mean, he is an embarrassment at this point. Oh, it's a problem with tenure. It's a problem with lifetime appointments. Well, he wants to stay so he can have these influences on abortion and things like that. He certainly had that influence. Yeah, but his wife could show up with a swastika and there's nothing we can do about it. That'd be interesting. What if she did that? All of these stories come back to the same thing. Dual class shareholder companies. No one can do anything about Sherry Redstone. Oh, you're a billionaire daughter that has no fucking idea what you're doing and you're wasting

people's time and taking the stock further and further down and basically shitting in the pond of your family legacy over and over and over again. There's nothing we can do. That legacy is not a great one. Go ahead. Yeah, but to her father's credit, that guy was a lion of business. He knew how to create shareholder value. He was a terrible person and ended in a terrible way, but go ahead. And maybe she will save all the whales and is a lovely person in terms of capitalism and shareholder value. She's a disaster, and there's nothing anyone can do. And this is the problem with tenure at universities.

About the time they start becoming less productive, we give them lifetime employment such that they can be disruptive and obnoxious. I'm not suggesting that you don't need tenure in certain departments. But, for example, in business school, we haven't said anything controversial in 40 years. The difference between Gap 1 and Gap 2 and deep water and blue water economics isn't going to get you burnt at the stake. All it's going to do is create an inability to manage the place cost effectively, which results in student debt. And to have no code of ethics at the Supreme Court, where you can basically give a lap dance to a billionaire who has stuff in front of the court and there's no repercussions, Or again, these all reverse engineer. Or my wife was involved in the insurrection.

I just, this is such bullshit. This is such- And there's nothing we can do. So what are the incentives? How do you get your wife in line? If your wife or my wife pulled this shit, we would be- Well, what can you do?

We would do something. What can you do? Divorce her? That's it. Well- She's like, what do you care? They can't do anything to you. She signed up for it, Mrs. Martha Ann, get in line. I get that you're a terrible homophobic piece of shit, but get in line. No algebra of deterrence, nothing we can do.

Algebra, is that your next book? No, just algebra of deterrence. It's very easy. The infraction times the possible punishment has to be greater than the upside. And the problem here, there's no possible punishment. There's no. We've talked, like this is everyone we've talked to. Elon, no punishment. Martha Ann and the judge, no punishment. Sherry Redstone, no punishment.

No consequence. No consequence for what they've done. Anyway, it's our theme. We planned it that way. Anyway, if you've got a question of your own you'd like answered, send it our way. Go to nymag.com slash pivot to submit a question for the show or call 855-51-PIVOT. All right, Scott, one more quick break. We'll be back for your prediction. Okay, Scott, let's hear a prediction.

You're obviously thinking a lot about Apple for your pace, but do you have anything else? No, that's it. I like to think on Pivot we call balls and strikes. I was not shy about the Vision Pro. I think that is literally the stupidest thing Apple's done. Maybe the exception of... Really? You do? You think that?

I've not heard that from you, but go ahead. I think Vision Pro is dead on arrival. I'm aware that you think that. Oh, you were joking. I'm sorry. Oh, I got it. Missed that. Missed the nuance.

As stupid as that was, it's brain dead. You hate it with the fury of a thousand suns, but go ahead. All that was, was Tim Cook going, if that mendacious fuck is right, I need to make sure that we're not too far behind. I think it's a bigger, longer term situation. They'll claim spatial computing has been incorporated into other things, and they're going to let it die a slow death, the same way it's dying a much faster death at meta.

Anyway, as stupid as Vision Pro was, Apple Intelligence is that smart. And my prediction is the following. You're about to see the second most lucrative licensing agreement in history form just a coagulate over the next 24 months. And that is Apple's putting itself in a position to extract 10 tons of flesh from either Microsoft or Alphabet to be the AI that has access to the billion wealthiest people on the planet. Just when people, analysts, do their homework, they're going to realize, here we go again. it's going to be another $10 or $20 billion a year in free cash flow to Apple. Yep. I think that's really smart. I think that's super duper smart. I think they've done

right timing, right time, right position to be in. Good for shareholders people versus other bad for shareholders people like Elon and Sherry Redstone. Good for Elon and not good for Sherry, actually. She's not going to get the money. You know the guy who should get 50 billion bucks? Who? Tim Cook. Tim Cook should get 50 billion bucks. I mean, I'm not suggesting anyone should get 50 billion,

but if you're going to get 50 billion to anybody- He might have 50. I bet he doesn't. How rich is he? Oh, he's got to be a billionaire. He's got to be. Oh, no, he's a billionaire, but how many billions? Oh, I think it's one or two billion. It's nothing like... It's got to be. But here's the thing.

He doesn't hold a gun to the company shareholders and saying, I'm going to... And also, the difference, Apple actually has a board that acts like fiduciaries. Yeah. He's no lo-wa-se-ma. That's the Elon. And they say, Tim is amazing, and he's a billionaire, and those two fit. That's fine. One billion is really good money for anybody. The others act like kings and potentates. Anyway, that's the show. We'll be in Cannes next week. Are you excited to see me?

Are you sending your jets? What do you have, a jet ski? What did you say you have? A cigarette boat? No, I have a Zodiac that'll shoot us over to the Palais and we'll roll up to Meta and wave at everybody. And because security's on the other side, we're like Lawrence of Rabia. Have you been invited to a lot of the parties? I'm going to go see John Legend.

Legend, yeah. I'm interviewing him on stage with his wife. And the Spotify beach parties are the best. Haven't received any invitations from Meta or Alphabet. I've received several invitations if you'd like to come with me. Yeah, I appreciate that. Anyway, that's the show.

Well, as I said, we'll be in Cannes. I'm interviewing John Legend and Chrissy Teigen, and then we have our Pivot Live at the Adweek House the next day. So if you're in Cannes, come through. And I assume you're appearing in a bunch of stuff, Scott, presumably. Not as much this year. I'm doing a thing with Richard Edelman, and I'm doing another thing. Actually, I'm doing a panel with Michael Kassim, but I'm not doing a lot this year.

Anyway. Okay, well. Anyway, we'll be doing Pivot Live, Kasson, but I'm not doing a lot this year. Oh, okay. Well, anyway, we'll be doing Pivot Live, which will be fun. We'll talk about a lot of things. We'll be of a very European flavor at it and talk about a lot of things. There's a lot to talk about.

The G7 just went up and stuff like that. Anyway, but we will be back on Tuesday with more Pivot. That will be from Khan. So please read us out. Send the Zodiac to pick me up on Sunday. I like you texting me.

You said, scramble the hydrofoil. Scramble the hydrofoil. I forgot what it was called. That's a good one. Today's show was produced by Lara Naiman, Zillie Marcus, and Taylor Griffin. Ernie and your tight engine there this episode. Thanks also to Drew Rose and Neil Severio.

Nishat Kurwa is Vox Media's producer of audio. Make sure you subscribe to the show wherever you listen to podcasts. Thanks for listening to Pivot from New York Magazine and Vox Media. producer of audio. Make sure you subscribe to the show wherever you listen to podcasts. Thanks for listening to Pivot from New York Magazine and Vox Media. You can subscribe to the magazine at nymag.com slash pod. We'll be back next week

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