Pivot - Roblox IPO, Facebook doesn't think it has an antitrust problem and a listener question on PlayStation5
Episode Date: March 12, 2021Kara and Scott talk about Roblox going public – and making a big splash – and what that means for the gaming industry. Then they discuss Facebook asking Federal judges to overturn the FTC's antitr...ust charges. In listener mail, a former Prof. G student asks if Sony has a Consumer Protection Act problem Learn more about your ad choices. Visit podcastchoices.com/adchoices
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I just don't get it.
Just wish someone could do the research on it.
Can we figure this out?
Hey, y'all.
I'm John Blenhill, and I'm hosting a new podcast at Vox called Explain It To Me.
Here's how it works. You call our hotline with questions you can't quite answer on your own.
We'll investigate and call you back to tell you what we found.
We'll bring you the answers you need every Wednesday starting September 18th. So follow Explain It To Me, presented by Klaviyo.
Hi, everyone. This is Pivot from New York Magazine and the Vox Media Podcast Network.
I'm Kara Swisher. And this is Piers Morgan. No, it's not.
I need a job. I need a job. he never shuts his pie hole the new co-host
well yeah
that's the problem
he actually speaks his mind
no he doesn't speak his mind
give me a break
he was like
ghosted by her on a date
which he talked about
extensively
and then got obsessed
oh my god
he was ghosted by who
Meghan Markle
oh really
I did not know that
try to keep up with this shit
I did not know that
let me tell you
he talked about it
like he was like
I get all my news from Fox and CNN.
Listen to me.
He doesn't get to speak his mind.
He's like a weird,
he does this constantly attacking women.
He's like, this is like, yes.
Really?
You really think it's targeted towards women?
I think it's a weird obsession with her.
He like goes all out on her,
and it's really odd.
He was ghosted by her.
That's what he said.
That is good dish.
He said in an interview.
I think he used the word ghosted, yeah.
So, and that's what that guy was referring to. He doesn'ted by her. That's what he said. That is good dish. I think he used the word ghosted. Yeah. So, and that's what that guy was referring to.
He doesn't speak his mind.
He's a pig in the way he talks about people.
It's just gross.
Actually, it's an insult to pigs.
It's an insult.
Hmm.
Tell us how you really feel.
I just find it like ridiculous that like, that you like immediately run to saying he
speaks his mind.
Like anybody, any drunkle can say anything
like at a dinner party and it's A-OK with you.
I just don't think it's the case.
I'm sorry.
I withdraw the comment.
Pierce, you know, this is outrageous.
Outrageous.
He deserves what he gets.
If they don't bring Alan Alda in as the new daytime host,
I'm going on strike.
Listen, who am I on the show with right now?
You're a very smart coach.
Someone who's only ridiculously fucking liberal instead of wants their statue cemented in the history of wokeness.
No, he has a history of doing this.
He has a history.
This is like every white man continues to be a trend that is always at the top.
I'm all of those things.
I am all of those things.
Always at the top.
They're always aggrieved.
They're always victims.
They never get to say what they want.
Well, he has like whatever million people on his Twitter feed.
He's got a TV show.
He's got a column.
And then he claims victimhood.
It's exhausting.
It's exhausting.
I agree.
This is exhausting.
What's our next story?
Our next story.
BuzzFeed announced massive layoffs of the Huffington Post.
BuzzFeed acquired the Huffington Post from Verizon Media last month.
And, of course, it announced layoffs.
A lot of the stuff they did was people are very good reporters, you know, who are more focused on reporting.
A lot of the people that stayed are more who, not the people that stayed, but they're focusing more on, obviously, numbers and things like that.
So, what do you think about that?
That's just.
I don't know about you, but I have just had it
with angry white aggrieved media companies.
I have just had it.
By the way, these are pretty white brands.
It's going to have like you yelling at me
about being a liberal.
It's like, it's like-
Yeah, that's clearly where it's headed.
One of us is yelling at the other.
That's clearly where this is headed.
This is like SNL.
You remember Jane, you ignorant slut?
This is where we're headed.
Yeah, I remember that.
I'm glad you said that.
This is where we're headed.
It's okay.
That was a great skit.
That was a great show.
So anyway, what do you think of these consolidations of media companies?
It's just going to continue.
Well, look, kids, when I say kids, I mean students will come into my office hours and
they never want to talk about the topic.
They want to talk about careers.
Right.
And they talk about digital media and digital marketing as if it's this robust ecosystem.
And digital marketing is an outstanding career
as long as you go to work for Facebook or Google.
And if you look at media companies,
we tend to think that the proxy or the forward-looking
indicator of success is old media versus new media.
And that is we go, oh, its legacy is a newspaper,
which means it's going out of business,
but it's online, which means it's going to accelerate. And the reality is that Huffington
Post and BuzzFeed are much less durable than the New York Times company or even Gannett.
Right.
And that is they have not figured out a customer acquisition model. They haven't figured out
retention. They are constantly getting gamed by Google and Facebook, who starch all the margin
out of the traffic that they try and get there. And basically, the internet is all flowing through
a couple of touch points. And if you aren't one of those touch points, you just slowly but surely
leak value. We're seeing a huge consolidation. There will be probably one or two winners that
are able to consolidate, lay off
people, and get to profitability. I think actually our company, Vox, it looks like it might be the
last woman standing, so to speak. But BuzzFeed and Huffington Post, quite frankly, lists. I've
never understood the attraction of HuffPo. I never understood its positioning. I never understood
its differentiation. I never understood its kind of- Well, it was sort of first out there with a
lot of this stuff.
I mean, you know what I mean?
But what is, in your mind, what is Huffington Post's editorial view?
I don't know.
BuzzFeed has lists.
I'll give it that.
They have lists.
Well, they have more than that, but they have some very excellent reports.
But what does the Huffington Post stand for in your mind in terms of editorial differentiation?
I think they bought it for traffic, I guess.
I guess for traffic is what I assumed they bought it for at the time, at that moment, because of that.
But they did manage to acquire some— I guess for traffic is what I assumed they bought it for at the time, at that moment, because of that.
And then, but they did manage to acquire some, you know, I think Ariana went all over the world opening Huffington Post Canada, which they closed down completely.
And some other things that I didn't, I understood it in a bigger sense, but not in an actual sense. It didn't make any sense to me to be opening outposts all over the world just because.
She's a visionary.
Yeah. me to be opening outposts all over the world just because. She's a visionary. But the thing is,
a company that's able to raise cheap capital, which the Huffington Post is able to do,
what you want is promise and then performance. And the reality is a visionary like Ariana and
the notion of having journalism on the web and having celebrity kind of journalists every once
in a while, although those two are oxymorons.
The bottom line is the performance hasn't matched the promise with BuzzFeed or Huffington Post.
That is an excellent way to put it.
That is an excellent.
It's going to be hard.
I think probably there's no news around a SPAC around BuzzFeed, of course, as there is around Fox and others.
But there's definitely a lot more noise around BuzzFeed right now.
So you wonder if they're trying to clean it up for a SPAC situation.
Yeah, I'd say the momentum. And, you know, they're trying to clean it up for a spac situation yeah i'd say the momentum
uh and you know we're we're pretty critical we're not afraid to throw you know bite the hand that
feeds us but i would argue that the momentum at vox is different than the momentum of buzz
it is different i think our momentum is actually i think we actually have momentum right now and
i would argue that the and it may be just the media coverage of buzzfeed but i would say the
momentum at least the perception is the momentum is not good.
And you want to go into any public offering.
The one thing SPACs aren't doing yet, and they probably should, is going after distressed properties.
You would much rather be a shitty growth company.
When I say shitty, I mean buying growth in non-economic terms than a company that has real assets but is declining in revenue.
So anyways, but SPACs will get there eventually.
SPACs will start going after distressed properties.
Yep, 100%.
It's just an interesting time for media, once again.
But I think you're not going to see the end to consolidation
as these things sort themselves out.
Maybe they can make their money via NFTs or some other way.
I'm joining Pierce Morgan's SPAC.
I want you to watch him for 10 minutes.
It's aggrieved white male SPAC.
You're not like him. Let me just say. Let me just make that. Well, you to watch him for 10 minutes. The aggrieved white male SPAC. You're not like him.
Let me just say.
Let me just make that.
Well, thanks for that.
Thanks for that.
But in any case,
just watch him for 10 minutes.
I like Chelsea Handler.
He and her got into it.
I always thought she was great.
She's great.
I never understood
why he picked a fight with her.
Just watch him for 10 minutes
and you'll get the whole point.
Anyway,
I will stop
with the aggrieved white man thing.
Although there was
an interesting story.
Oh yeah. I'm sure we're never going to hear that talk track again. Well, it's just like every day. Well, I'm stop with the agree white men thing, although there was an interesting story. Oh yeah, I'm sure we're never gonna hear
that talk track again.
Well, it's just like every day.
Well, I'm glad that's over.
Every day, it's like, oh God.
And they go on and on about Dr. Friggin' Suze, these people.
What is their problem?
Like the people-
Can we talk about that for a moment?
Yes.
That's just a capitalist move.
Yes, exactly.
The publisher has just decided
we will sell more of these books
if we get rid of certain shit that offends people. It's just a capitalist move. Yes, exactly. The publisher has just decided, we will sell more of these books if we get rid of certain shit that
offends people. It's just a capitalist
move. And then Fox has
decided, we're going to offend those same
people because there's money in it. Both are capitalist
moves. They're using it as a thing. You saw
whatever his name is, Kevin, whatever the
heck, the minority leader that
keeps liking and disliking Trump,
who's such a stupid windmill.
Anyway, he was reading. A stupid windmill. Anyway, he was reading.
A stupid windmill.
Just he went back and forth.
That's very good.
You should be in journalism.
A stupid windmill.
I don't think I've ever heard those two words together.
Listen to me.
I'm just saying it's exhausting.
Well, you're a charming nuclear reactor.
Okay.
That's good.
I'll say I'm going to have to let you
That's why you put up with my aggrievedness,
my whiteness, and my maleness. One thing that's nice about your aggrieved white maleness
is you're often right on certain things.
Let's go to the big story.
Just because I'm angry doesn't mean I'm wrong.
That's true.
Here's the big story.
Roblox went public this week.
Let's talk about the company
and what's next for the video gaming market.
The Silicon Valley Video Game Company,
it's an indie video game company,
opened its first day of trading at $64.50,
a share that was up more than 43%
from the reference price of $45.
That valued Roblox at $41.9 billion,
up from $4 billion just over a year ago
when you were talking about it, Scott.
In the last year, $56.9 billion about it scott in the last year uh 56.9 billion
dollars was spent on gaming in the u.s that's up 27 from 2019 not a surprise a lot of people at
home um so what up what talk about it well i don't know if you remember but a certain podcast
in q3 of last year said this thing was a gangster when it was valued at three billion and said it
was going to be a monster ipo so why did you talk about your, walk us through your thinking on that so people can
understand your genius. Well, it's not even a video game company. It really is a platform. And
what they have done is they've learned from the sins of the father and they've recognized that,
okay, what does Facebook do really poorly? One, they lie to us and try and feign concern about
the wellbeing of our children. And this company
actually has made substantial investments in content moderation. They have indeed.
It is truly a platform where it tries to more than just stroke their fingers through the hands
of their creators and then put a bullet in their head and starch all the margin from their creators.
A third of their revenue is going to actual creators. That's an interesting business plan.
Yeah, okay, go ahead. I mean, they are, I believe they paid out to their creators
a quarter of a billion people
and they're not actually
in the business of development.
They're in the business
of creating a platform
and then just,
it's more dispersion.
It's like, okay,
the people at Activision or Blizzard
shouldn't get to decide
what 11-year-olds want,
what video games they want to play with.
If you're an individual
who comes up with an idea
for a fun, cute little game involving pigs and farms
and 11-year-olds love it, we just get it out there.
We disperse, we leapfrog
the traditional video game industrial complex,
and we give you a portion of those rents.
No one video game, I think, has more than 10% market share.
And the numbers are just staggering here, over 50%.
There are more people under the age of 18 on Roblox than there are not.
So this is arguably-
It's interesting doing this thing, which you're just saying,
taking these sins of the people before them and making it a safe gaming platform for kids.
You know, it is important.
You know, it's absolutely important. The longest time struggle
with my kids and the video games. And because these large, you know, whatever the large platform
was that put them out, it just creates something that, it's interesting, any of these companies
taking the mistakes made, like a Shopify to an Amazon or something else. That is exactly the
right analogy. Thank you. Exactly the right analogy.
So they're up 12% again today.
So how does this whole space, not just Roblox,
but what else should be, you know,
hey, we're watching this happen, let's make this?
Well, there's what I call the immunity strategy
or the ZAG strategy.
And that is when a huge player
a huge player is creating hundreds of billions of dollars in market
capitalization yeah and it's zagging for example it is using massive investment
to create so much traffic no one can compete with it and then slowly but
surely partnering with its retailers on its platform the way of a virus partners
with a host and that is keep it alive just long enough so you can soak it dry, i.e. Amazon. And then Shopify comes in and says, you know what?
We're not going to be, quote unquote, obsessively focused on the consumer, and as a result,
basically treat our customers, our retailers, like shit. Yes, our partners. We steal their data. When
their business becomes too profitable, we vertically integrate into it.
We decide what goes in the box.
You don't know who the consumer is.
And Shopify said, we are absolutely going to focus.
We're going to zag.
Yeah.
We're going to let the retailer control the customer.
We're going to give you the data.
We're going to give you the branding.
We're going to let you decide what goes in the box.
What is public doing?
Disclosure, I'm an investor.
All right.
Robinhood, the number one player,
has created $30 billion supposedly in market capitalization
if Goldman Sachs is willing to be a total fucking hypocrite
and take this company, Public.
What do they do?
Public says, we're not gonna sell order flow.
We're not gonna be bro-y.
We're gonna have 40% women.
There is an enormous strategy of shareholder value creation
around what I call the ZAG,
and that is when any one company
creates the type of slipstream or air cover that creates hundreds of billions of dollars,
look at the externalities, look at the viruses it's creating and saying,
what immunities could we bring to market that are totally different than what's happened here?
There's going to be, TikTok is zagging. That should be your next book, Zag.
TikTok is zagging against social,
against video platforms.
It's trying to be cleaner.
It's trying to be more optimistic.
It's not allowing people to start insulting each other
in the comment section.
So there's, anyway, but your analogy
is exactly the right one.
Roblox is saying-
Talk about where this goes,
because this idea,
just again, it's up 12% again today.
I think it likes creators,
is what you're saying.
That's the second part,
is the respect for creators get tired
in a system that's more predatory,
I guess is the right way to put it.
It's an abusive relationship.
YouTube is very good at publicizing the 15 people
that make a million dollars on YouTube.
But there are 15 million people, creators on YouTube,
making less than a dollar.
Because YouTube figures out a way to starch
almost all of the margin out of the relationship.
And they have been just incredibly fucking greedy.
And Roblox is saying, okay, the key here is our partners, our creators.
So I think even TikTok's trying to be more generous with their creators and say, all right, how do we get the secret sauce here is leveraging other people's creative talent.
And so where I think it heads is I think there is what I call a zag in every major market.
Your guy from Neva, he's creating a zag to Google.
Yeah, he's trying.
He's saying, okay, what's the problem with Google?
Google started out as the best place to get to the right information,
and slowly but surely, Google has become a place that takes you to another place they can further monetize.
Why?
Because the advertising model is the tobacco to nicotine.
It's the shit that gives you cancer.
And so,
your buddy at Neva said, I'm going to make it subscription-based, and I won't have the
temptation. Then my focus will be to take you to the best place based on your query.
That is a zag strategy. I think that, by the way, I think that company is going to be a monster.
They just closed their seed round, I think. And he strikes me as incredibly impressive.
Yeah, he did just cover it. He did, he did.
He's a really interesting guy.
And he knows, I think, I had him tell a class of mine
and he was talking to the students why he did.
He said, I felt like I was part of something
very menacing essentially, which was interesting.
All right, so what's next for the video game industry?
What happens to these, the big ones that, you know,
sort of, it was sort of like the record industry
and then they pick winners, you know,
and then shower them with attention and also take a lot of their value, essentially.
What happens in the – that's how the video game industry – you have these big video gaming companies that then publish these things.
Same thing with the book industry, everything.
This dispersion, bring it home to dispersion.
Well, effectively, dispersion is kind of a pedantic, aggrieved white male way of saying
when you leapfrog the traditional players. So, Warner Brothers and Wonder Woman 1984 have
leapfrogged traditional movie theaters and said, look, it's better for us. We'll create more
shareholder value if we pulse HBO Max by creating value and not taxing people by saying, all right,
you either got to see a movie or wait 12 weeks.
So these guys have said, all right,
we're going to leapfrog the traditional gatekeepers.
What would be interesting is if Sony or Microsoft
create their own platforms and piss off the big game developers
and say, we're going to let individual creators
have access to this platform.
So I think it's really exciting.
Roblox at this valuation, I'm not a buyer.
I think it's an amazing company. But you at this valuation, I'm not a buyer.
I think it's an amazing company.
But you know who else is zagging that just filed for their IPO?
It's Coursera.
Coursera.
Coursera said, okay, there's this traditional enforcer of the caste system called Elite Universities,
and we're going to zag and try and bring the cost down.
And they went to MOOCs, and then they went to short-form courses.
They, according to their S1, I think,
or they just filed to go public,
they did a quarter of a billion dollars in revenue.
So anyways, my point is,
and I think this is the lesson to young people.
When you see, for example, Tesla.
Tesla now has, even with its,
Tesla has sold off 35% in the last like four weeks,
which is extraordinary.
But even with that sell-off.
It's had a sell-off because,
there's lots of reasons, but go ahead, yeah. But it's still, it's extraordinary. But even with that sell-off- It's had a sell-off because there's lots of reasons,
but go ahead, yeah.
But it's still, it's unfair to say it's a sell-off because it's worth a half a trillion dollars.
It's worth the entire automobile industry
even after its sell-off.
That is going to attract competitors.
And I think an interesting analysis
if you're in the automobile industry
or you're just a young person
trying to think through strategy is to say,
what are the externalities
or what are the negatives of Tesla and what automobile company could zag? Because everyone's zigging.
That's a tough one because of the difficulty of the technology.
100%. But it's an interesting exercise to go through. And I'm just using this as an example
because by 2030, Volvo said they're going all electric. By 2035, GM said, so everyone's zigging.
Is there an opportunity around something else? But anyways, my point is, as a species-
How about a giant gas guzzling car?
What do you think?
Well, those were, that was what saved Detroit.
Yeah, yeah.
I mean, do you remember the first time you saw Hummer?
And you thought, oh my God, the species is going to go extinct.
Yeah, but the Ford 150s, you're right.
That was the winner car.
So I think, anyways, it anyways, I love the Zag.
I love the Zag.
The most innovative companies of the last 10 years, I think, have been companies people don't talk about.
I like Zag.
Shopify.
I'm going to call you Zag from now on.
You're a Zag.
Zag.
Zag.
You're Zag.
You're a Zag.
That would be your superhero name.
You'd just Zag all over the place.
You'd be like, Scott, calm down.
Slow down.
I like that you're looking at me in the context of a superhero versus the aggrieved white guy.
Many superheroes are, if you think about, you know, Iron Man.
No, the nemesis is.
Iron Man's pretty aggrieved.
He's always mad.
That guy's not aggrieved.
That guy's a gangster.
He is, but he's often like mad.
Tony Stark?
He's mad.
There's a lot of mad superheroes.
I would say Hulk is an aggrieved white guy.
Oh, yes.
He's basically a scientist that didn't get tenure.
The majority of my colleagues at Stern are the Hulk minus the muscles and good guy. Oh, yes. He's basically a scientist that didn't get tenure. The majority of my colleagues at Stern
are the Hulk minus the muscles and good intentions.
Oh, man.
Nothing like a mad professor.
Oh, yeah.
It gets scary.
That's it.
I'm going to throw my PBS tote bag at you
if you continue this.
That was good.
I just thought of it.
I like that.
You don't like tenure, so they must love you, right?
They must love you.
Yeah. No, I'm very popular around They must love you. Yeah, yeah.
No, I'm very popular around those parts right now.
Yeah, someone mentioned that to me.
I was in an NYU class.
About how much they don't like me?
No.
Someone mentioned that.
They were using euphemisms.
Like, well, Scott's an interesting character.
Scott's, you know, he causes a lot of discussion around here.
They were trying to write around what they were.
I was like, what are you trying to say?
He's a pain in the ass?
Is that what you think?
No, he's a breath of fresh air.
Right.
He's a breath of carbon monoxide when the garage door has been closed.
Oh, it was funny.
No, I got to give it to him.
They are so much generous and patient with me than I would be with me.
Yeah.
Fortunately, the deans have been like wonderful, generous people.
Anyway, what are we talking about?
Where are we?
Bring us back in.
Scott, we're talking about Scott again.
All right, we're going to go to a quick break.
When we come back, that was a very good call on roadblocks.
I'm going to give you credit there.
There you go.
Is that what you need to this week?
Road to the blocks.
Road to the blocks.
Good job.
Before we go, you know what the most exciting news?
What?
I got a video, a text message video of a kid dunking.
Uh-huh.
And it was that.
Oh, my son, yes.
Your son is dunking.
I know.
That is very exciting.
He's like, right, I have like 20, he's like, he made me go, I actually had fun.
I didn't think I would have fun because I'm so little.
And that's the time I had a basketball.
Basketball's great.
Sixth grade.
Basketball's great.
You know what?
He had a great time.
He goes to the local neighborhood court here in Shaw and plays with all the kids there.
And they were all wearing masks.
It was nice.
The mean streets of Calorama.
Is that what you're trying to get your street cred?
He was like getting out and meeting people in the neighborhood.
It was nice.
Can you just not take a nice thing?
I'm sorry.
Go ahead.
I'm sorry.
There was no mean streets here.
I never think there are mean streets here.
There's lovely people who live in this neighborhood.
So anyway, he had a great time and it was nice.
And he does-
He throws down.
I saw that video.
I watched it several times. He does. I have lots of them. That's exciting. It's really, he like can reach time and it was nice. He throws down. I saw that video. I watched it several times.
He does.
I have lots of them.
That's exciting.
It's really, he can reach the top and throw the ball in.
He's very tough.
That's called a dunk, Kara.
That's what it means to dunk.
I know.
Junk a dunk.
Reach up and throw it down.
I know.
I know.
You know what I did?
I tried to pull his pants down.
That's what I tried to do.
Nice.
I was trying to beat him.
You pantsed him?
Actually, you never listen to my other things because you ignore me completely.
But I interviewed Spike Lee today and we had a long discussion about basketball.
You're kidding.
Yeah.
How was he?
Great.
Funny.
It's a really fun.
It's a fun, easy interview.
NYU.
NYU.
That's right.
He talks about NYU.
He did not talk about Scott Galloway, though, just so you know.
Okay.
We're going to go on a quick break.
When we come back, we'll talk more about the legal battles in big tech and a listener mail question.
Come back, we'll talk more about the legal battles in big tech and a listener mail question.
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Scott, we're back.
Facebook is asking a federal judge to dismiss antitrust lawsuits
by the Federal Trade Commission
and the state's attorneys general.
The company is arguing
that the government has no valid basis
for alleging the social media giant
is suppressing competition.
This is the first legal move in the company.
It's going to be a long time, I think,
since antitrust charges were handed down in December.
Meanwhile, this week, a bill that would allow news outlets to bargain with tech platforms over the distribution of their content was introduced by a bipartisan group of lawmakers.
So what's happened in Australia is coming here.
It's called the Journalism Competition and Preservation Act.
That sounds sad, I have to say, and it's being touted as a way to say local news.
And so it looks a lot like what
happened in Australia. So things are moving. What do you think? What do you think? What's going on
here? Obviously, Facebook's got to slap back. It's going to be interesting. I see this as
it's coming down to a battle between a lot of the judges that were appointed by the Trump
administration that never, you know, I think are probably more sort of Bork antitrust.
They're more about let the markets go where they go.
Although we'll see.
This has been a bit of a bipartisan issue versus two total gangsters,
Professors Tim Wu and Lena Kahn.
Yeah.
And they've both been appointed to post within the administration.
Yeah. And you do not want to fuck with these guys.
Let's say Lena Kahn is going to the FTC, or allegedly.
I mean, she's got to get through to be approved and stuff.
And then Tim Wu is joining the National Economic Council.
That's right, right?
Yeah, I've had both of them.
I think we've had both of them on our podcast.
And they're both just incredible.
She's an inspiration.
You know, she's like 17 and is a legal scholar.
And Tim has the ability to just bring stuff down to kind of very basic.
Like, you listen to him say something, you go, well, that makes sense.
So I think it's super exciting that both of them are in the administration.
I think they're exactly the kind of people that you want wrestling with these issues such that you can trust that they will come up with really thoughtful decisions that are somewhere between, you know,
the recognized the grays and the importance
and the need for capitalism, free markets,
but at the same time recognize the concentration of power
that's occurred here as well for the economy.
I think the signal, Tim is joining the technology
and competition policy at the National Economic Council
and Lena at the FTC.
They're considered anti-tech.
100%.
Like if you had to put them in a pocket.
Well, I wouldn't even say, I don't know.
They're not anti-tech, they're anti-monopoly.
Right.
And I think that what we fail to realize
is that breaking up monopolies will be really good for tech.
It just might not be good for Facebook or Google CEOs.
I think it's going to be good for their shareholders.
I think it's going to be great for their employees
to have more organizations bidding
or trying to rent their talent.
I think it's going to be great for the
markets, great for job growth, great for taxation. So I would argue that professors Wu and Khan are
very pro-tech. I just think they're anti-monopoly, which by the way, is a very Republican capitalist
positioning. Although Republicans are now saying we just shouldn't mess with success
is often their argument. They seem to be less sympathetic. This feels like a bipartisan issue to me.
Yeah, it does.
It does.
I think it'd be really interesting to see
what kind of influence they'll have
and then the road to confirmation
because when there was a report of Khan's nomination,
whether it was true or not,
Mike Lee, who's, I think he's really won
many cards short of a deck.
He said the Khan's nomination, if true, was deeply concerning.
And he criticized her youth and experience.
That's just ridiculous.
She's really, you know, saying she's a kid, essentially.
Ms. Khan, no doubt, has a promising career ahead of her.
What, he's saying that like it's a bad thing?
For God's sakes, we're talking about technology.
I know.
I was like, are you kidding?
You know who's president?
We don't want to have Strom Thurmond figuring out how to regulate.
Let's get Strom Thurmond dug up from the grave and ask about search.
I know.
Right, right.
So anyway, so and then he said her views on antitrust enforcement also wildly out of step with a prudent approach to law.
I mean, honestly.
She's fucking John Travolta in step.
Yeah.
She is literally on the disco floor with that young woman,
Step.
She's got Step, Cara.
She's got Step.
I think he's just,
he's really lost
the narrative,
as they say.
And then
David Cicilline,
who she worked for
during,
worked with Khan
during the tech investigation,
said it would be
a major victory
for locally owned
businesses,
workers,
and everyone
who's been negatively
affected by the dominance
of big tech.
She worked for him on the antitrust.
Best congressional hearing I have ever witnessed.
Absolutely.
She was in the background and Representative Cicilline put on a masterclass.
Masterclass.
Agreed.
Agreed.
I guess I'm too young.
Are you kidding?
They wouldn't say that about Mark Zuckerberg when he was 24.
What a brilliant person he is.
No, he's an innovator, Tara.
He's an innovator.
It's just ridiculous.
No, you're an innovator. He's an innovator. It's just ridiculous. No, it's,
you're an innovator. He never had another job, Mike. If you're young and worth a billion dollars,
you're an innovator and you're a great American. But if you're young and a woman,
you're inexperienced. Yep, exactly. And a woman of color. So Tim's book, his 2019 book was The
Curse of Bigness, Antitrust in the New Gilded Age. Obviously there's a lot of books coming out.
It's a great book. Yeah. That is a great book. I read like two books a year, and that's one of them. That was an outstanding book.
Yep.
And also, Biden's being very careful not to put too many tech people in big positions,
like big prominent positions.
They don't want to do...
There was a rumor that Eric Schmidt was going to be in the administration role,
and I think progressive groups were like, mm-mm, mm-mm, mm-mm, like that kind of thing. I think that's a tough one. Yep, yep. So, this is going to be in the administration role, and I think progressive groups were like, mm-mm, mm-mm, mm-mm,
like that kind of thing.
I think that's a tough one.
Yep, yep.
So this is going to be interesting.
So Facebook's obviously going to fight back hard here.
They're going to hire every lawyer that they can get their hands on
and try to push back on this.
But I do feel like this is—
The worm has turned.
Worm has turned.
Worm has turned.
We'll see.
They could have some wins.
They could have some wins.
They're very clever people.
There's some really books that are coming out that are not so pretty.
There's Shira Frankel and Cecilia Wang, who work for the New York Times, have a book coming out in July that I think is not, it's called The Ugly Truth, I think it's called, on Facebook.
That's the name of the book.
So, I think there'll be a lot of reporting on what happened within there just right when this stuff is coming out.
So we'll see.
We'll see.
I think it's going to be, I'm going to look it up.
Anyway, we're going to move on to listener mail.
All right, Rebecca, please play the question.
It's for Scott, I think.
You've got, you've got.
I can't believe I'm going to be a mailman.
You've got mail.
Hi, Scott and Kara.
Scott, this is a former student of yours leaving a message here. My name is John based in Los Angeles and
I have a question for you about what's going on with the Sony sale of the
PlayStation 5 console. It seems like there's a significant violation of the
Consumer Protection Act here. The Consumer Protection Act is clear that we
have the right to be informed about the quality, quantity, potency, purity standard,
and price of goods to protect the consumer against unfair trade practices. Sony and its retail
partners have done nothing to stop bots from buying all the stock. How is this not a violation
of the Consumer Protection Act? Thanks. So first off, John, it's great to hear from you. I love hearing from my 5,500 alumni. So thanks for reaching out.
Wait, you have affected 5,500 young minds? Infected or affected?
I said infected, actually. Infected, yeah.
Go ahead, keep going. Sorry. Thanks for that.
Anyway, so scarcity value is really interesting. And essentially, like everything, it's linked to instinct. And that is previous generations or in olden days, you were really smart instinctively, or it was an instinct to become obsessed over scarcity. If you sensed a scarcity of food, supposedly we have a third of the spinal
ganglia of our brain is in our gut, you became obsessed with finding food. The moment there was
a scarcity of it, you became obsessed with finding a mate if there was a scarcity because survival
and propagation are really important. And that is still with us, this notion that the moment we perceive,
whether it's artificial or not, and it usually is artificial, scarcity, the value, the perceived value of that product skyrockets. So in this case, so you go buy a Panerai watch and you go
into any Panerai store and they're going to tell you, we don't have that model or there's only
seven. And it's not because there's a supply constraint on the parts and movements. It's because luxury has mastered or tapped into the instinctive need of scarcity,
and they create artificial scarcity to increase the value. The latest real gangsters around
perceived scarcity are these new NTFs that are trying to convince you that if I create just
one digital application of this video or piece of art that it might be worth millions of dollars.
That is really tapping into what I'll call
instinctive overdrive around scarcity value.
And in this instance, what Sony has decided
is if some people, some actors,
whether they're good actors or bad actors,
move in with bots and create the illusion of scarcity,
it drives up the value and all of a sudden
we become very focused, even obsessed, it drives up the value. And all of a sudden we become very focused,
even obsessed in getting the PS5. The problem is the person that pays for that is just the
average household that just wants a PS5 when it comes out. So do you, you know, what is the
trade-off? Schools, universities, higher education have massively tapped into this bullshit notion
of scarcity. Harvard has the endowment, the supply,
the technology to increase their freshman class tenfold, but they want to create scarcity because
they're drunk on luxury and believe their Hermes, not public servants. So scarcity value and
understanding it and understanding how to leverage it and trade off short-term revenues to create an
obsession, instinctual, an instinctive obsession with getting more of that product is an incredibly
dev business strategy. And that's all that's being applied here. The question is whether or not,
does it violate FTC or does it violate antitrust? I don't know. At what point does a bot become a
person? If I leave my computer and program something to notify me, is that a bot or is
that a person? I don't know.
But I think the interesting thing here is how great brands and companies leverage scarcity value.
Yeah. Yeah. And yet not powerful for consumers.
Well, there is some psychic reward to believing that you got something that has scarcity value.
I don't even know. We still have to talk about NFTs at some point, which we will.
You know what? It's been seven minutes, and I want to trigger you.
Piers Morgan, he's my hero.
He's my hero.
He's my hero.
I think he makes a lot of sense.
A lot of sense.
Okay.
All right.
All right.
We're going to take one more quick break.
That was an excellent answer, Scott.
I'm going to be really nice to you today because that's the only thing that seems to work.
Today.
Today.
Today.
Well, that's a great goal in a partnership.
You know what?
We're in a long-term partnership now.
Is that what you say to your wife?
I tell you what, I'm going to be nice to you today.
Here's the situation.
I think we've just struck a long-term partnership and you're like, what?
Just a minute.
You're like, no, oh, no, oh, no.
I'm stuck with this lady for a while.
You're the future ex-Mrs. Galloway just in a professional sense.
I mean. We will delve into that situation later.
But right now we're going to take one more quick break
and we'll be back for predictions.
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Go on.
I hear you've been on it with Larry Wilmore, who I love. What did you say?
You've been invited, finally, to the Bill Maher show.
Tell me about how you feel about that.
What are you going to talk about?
I think I'm, at the end of the day, I think I'm like Lyle Lovett,
and that is they bring me on a talk show hoping that Julia Roberts will come on.
I think that they're using me to get to you, but I don't care.
No, I've been on the show.
I know.
I think I want you back on.
Anyways, anytime I meet someone who's nice to me, I'm like, does this person want me on their podcast or are they just trying to get to Kara?
Anyway.
You're my gator.
You're the gating mechanism for Kara Swisher.
Anyway, tell me what you're going to talk about.
What do you think your themes are?
I don't know.
My guess is we're going to talk about Meghan and Harry and there's a one in three chance I'll be canceled.
Oh, yeah.
And we're going to talk about. I've watched Piers Morgan a one in three chance I'll be canceled. Oh, yeah. And we're going to talk about—
I've watched Piers Morgan before you nailed off about him, but go ahead.
Go ahead.
The honest truth is I don't know what we're going to talk about.
I imagine we'll talk about my book, Post-Corona, From Crisis to Opportunity.
Yes, good idea.
But Larry Whitmore, who's, as you said, is lovely and funny, is on the show, as is Anna Gerwich.
Is that her name?
She's a wonderful author that talks about family dysfunction, which is
redundant. Right in your wheelhouse. Yeah, there you
go. That's great. That's going to be good.
Everybody tune in for Scott. Is this week?
It's tomorrow. I got to be honest. It's a dream
of mine. I love Bill Maher. I think
he's courageous and funny. You and me will truly spark. You're of
the same mind in many ways, I have to say.
A grieved, angry old guy.
No, but I think you'll both bond.
I think you'll bond. I think you'll bond.
I think you'll bond rather well.
Are you going to do it...
Are you going to Los Angeles?
It's kind of fun to be on there.
Yeah, I'm flying out there this afternoon.
Unfortunately, it's not as much fun.
They are very responsible, and it's inspiring.
They do rapid tests the same day.
No congregating.
You know, studio audience is distanced.
They're taking it very seriously.
As a matter of fact, they have two panelists instead of three, so everyone can sit more than six feet apart.
Yeah, you'll have fun.
It's a great set.
It's a really fun set.
And also, there's usually a party afterwards, and you're not going to get to go to that.
That just sucks.
That just blows.
Maybe you can have a vaccinated party.
Maybe you and, like, who else?
California is having real troubles getting everyone, although some people are getting vets.
It seems rather disorganized everywhere, of course, as I've discussed. Okay. What is your actual prediction?
So I, like, Roblox, gangster kind of re-engineering or dispersion of video games. I think the IPO to
watch, and I need to dig into the S1. I need to understand the pricing. But I think the term
Coursera and Coursera IPO are going to be terms that are going to be in the business news and on CNBC a lot.
And I think the Coursera IPO, I'm not going to predict what the IPO is going to do until I dig in and understand the numbers.
But their consumer pickup here and revenue here and the company's still losing money. But Coursera, if the IPO cements and the
lead up to the IPO cements their brand as sort of the leader and the pioneer in the dispersion
of campus to online learning, you could have a company that could really rock it on its IPO
and pull the future forward without additional capital. So anyways, my prediction is that
just as no one had heard about Roblox four months ago, and now everyone's talking about it,
we're about to go through the same upward cycle of awareness and value creation just
through perception around Coursera. Did you notice that Sundar Pichai
answered our question about Google Courses? He did?
Yeah, Sundar himself did. Yeah. He's so likable.
I know, isn't he? Did he tag me or did he just tag you?
He did.
He tagged you.
Don't worry.
He tagged you.
I missed that.
He said, it was a response, and he said, Professor Galloway and Karis Wisher, we just announced,
Sundar, we just announced, is now open for Google Career Certificates in Data Analytics,
Project Management, and UX Design.
And then he specifically tagged you and me.
Wow.
Isn't that nice?
Yeah.
Okay, don't break them up.
I like them.
I like them.
I mean, that's how easy it is, right?
I'm like, well, maybe Google isn't that bad.
That's under so likable.
Yeah.
Yeah, he answered your question.
You were said was wondering about the same thing when someone asked, Ryan Merrill asked,
whatever happened to Google certification program you and Kara Swisher talked about nearly a year ago?
And then Sundar answered.
He weighed in.
He weighed in.
Could be transformative.
A little bit more.
50,000 plus have graduated from our IT support certificate and are prepared for careers in IT.
We're now adding Google career certificates in data analytics, project management, and UX design,
expanding our consortium of employers of hiring graduates.
There you go. That's nice. 50,000 people. Yeah employers of hiring graduates. There you go.
That's nice.
50,000 people.
Yeah.
That's serious.
There you go.
You're making an impact, Scott.
You're having an impact.
Oh, yeah.
This is all about me.
Thank you.
You seriously, you play me like a fucking fiddle.
You're like, okay, I've smacked him a little too hard.
You're like, oh, I heard you going on Bill Maher.
You literally play. I'm happy for you going on Bill Maher. You literally played.
I'm happy for you.
You'll enjoy it.
I think you'll be great.
And more people should have a little Scott time.
Two things.
Two things.
The first is I feel very manipulated.
And second, I like it.
I like it.
I like it.
It works for me.
The whole world will get to see.
It works for me.
The world of HBO Max, at least, will get to see the Scott Galloway.
We all know. Okay. That's the show. I'll get to see Scott Galloway. We all know.
Okay, that's the show.
I'm excited to watch you on Bill Maher.
We'll be back on Tuesday.
You can tell me about how it went and how Los Angeles is.
I love Los Angeles.
Love LA.
As soon as I get vaccinated, I'm flying out to LA.
I'm going to go get a Cobb salad at the Beverly Hills Hotel.
I'm going to go to Carney's.
I'm going to go to In-N-Out Burger when we land at the airport.
Oh, that's a good idea.
There's a good one on the way to Bill Maher's show.
Love LA.
Yeah, I love LA.
There's a great lunch place.
It's so inside, though.
I don't know what their rules are right now, actually.
See my fraternity brothers at dinner at a place called Mastos in Malibu?
Yeah, it's Mastros.
Mastros?
Yeah.
You're so down in LA.
I love LA.
I spend a lot of time there.
I miss it so much.
I have many friends there.
Anyway, go to NY, have a good time,
at the nymag.com slash pivot
to submit your questions for the podcast.
The link is also in our show notes.
Scott, don't forget to wear your mask too
because that's the new season.
100%.
Even though you've been vaccinated.
Anyway, read us out.
Today's show was produced by Rebecca Sinanis,
Ernie Intratat, engineered this episode.
Thanks also to Hannah Rosen and Drew Burrows. Make sure you subscribe to the show on Apple Podcasts Read us out. All things tech and business. Kara's son can jump really high and push that round thing down.
It's called a dunk.
Dunk. Throwing down.
Dunk.
The Swisher children.
The Swisher boys.
Throwing down.
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