Sharp Tech with Ben Thompson - Netflix Gets the NFL for Christmas, The Streaming Wars Become the Bundle Wars, Leagues and Studios and Internet Realities

Episode Date: May 20, 2024

A variety of notable Netflix developments over the past few weeks, Hollywood's continued move to a (kinda) rebundled future, and what sports leagues are learning as internet realities take hold across entertainment. At the end: Andrew finally watches "Her" and shares his review.

Hello and welcome back to another episode of Sharp Tech. I'm Andrew Sharp and sitting across me today, live and in person, Ben Thompson. Ben, how you doing? I'm frazzled, Andrew. We're dealing with a flight delay. We have a birthday party to get to. We are trying to make this hotel room work. It was touch and go.

It's still kind of touching go. Let's not make any promises until we finish. Five-hour travel saga. Always a great lead. into podcasting. That's right. We'll try to keep it light and tight today. And I promised a streaming check-in for everybody.

We're going to start with a couple different Netflix notes. First and foremost, last week, the Wall Street Journal reported that Netflix will stream at least one NFL game globally on Christmas Day for the next three years, beginning with two Christmas games this year when they'll have Chief Steelers and Ravens Texans. Netflix is paying about $75 million per game this year. according to people familiar with the matter. And I like this email we got from David.

He said, I think we can all agree that Netflix is a smart bunch. After picking the lowest hanging fruit of password sharers and converting most of them into subscribers, my hunch is they have their site set on the next big, untapped subscriber group, boomers. I'm talking about an older generation of maybe 10 to 15 million folks

who would love their content, but so far just haven't managed to set up the test. and or graduate beyond their old TV platforms. So how do you get boomers over the hump? Well, Netflix could set up a fleet of thumbtackers or other outsourced services, but that makes customer acquisition far too expensive. So what if you could find a reason for all the kids and grandkids visiting these boomers over the holidays to install them an Apple TV or Firestick?

Long story short, my take is that the Christmas date of the Netflix games is not coincidental. It makes the deal more than a mere sports play, but a delightful new customer acquisition tool with existing members gifting the hardware and subscription to their relatives. What do you think of that theory, Ben? I have a feeling this is more about ads, but in general, are you updating your mental model of the 2024 Netflix strategy in the wake of this news? Brilliant, brilliant email. I love it. It is so good. So yes, you're right.

The obvious play here is Netflix. So number one, sports never made sense until they do advertising. Now they do advertising. What do they need to do for advertising? They need to build up their user base. What's the number one property in all the world if you want to get everyone at scale using your advertising as soon as possible? The NFL, right? And so it makes total sense in that regard, even if they lose money on it.

And I would go back to the 90s when Fox acquired the NFL. I think I've seen reports they never made money on that deal, but that made them into a real broadcast network. And you fast forward in 2000s. You get retransmission fees and all. And broadcast networks are incredibly valuable. It was one of the best deals sort of all time. And I think you can paint a picture where that's where this fits in. What is brilliant about this email is the whole when is your kids going to be in the house and help you set it all up?

It's a nice little secondary benefit, you know? I mean, you're right. The Netflix is smart. And so maybe that absolutely is part of it. And you get them just sort of that, you know, you heard about this anecdotally with other NFL games where the ratings are lower and the average age is lower. And on one hand, it's like, okay, to what extent is the average age being lower because they're reaching kids where they are? Or is it that the old people all can't figure out on a tune into the game?

game. And so of course the average age is lower. And to have this sort of ready made solution to the problem, it's, it's quite clever. I also feel like old people, maybe more likely to tune in to like a big game like that. Thursday night football is not meaningful or dramatic enough to motivate the old people of the world. Speaking as an old person myself, I don't think you're the target audience. And I've just for the record, this is where we get a quote, look, we already did our customer support sort of routine before this podcast, which is, number one, it's not working, unplug it, plug it, plug it back in. Number two, restart the computer. But I think we are still sort of... Listen, we've established, though, I have the boomer soul on the podcast, so I know how these

people think. But also Netflix, they'll probably have programming for the rest of the family, so some parts of the family can watch football and then there's a movie to turn on afterwards. It makes a lot of sense. I noted some references. reference points here just for anybody who's curious. Netflix, $150 million for this year's Christmas games. Peacock paid $110 million to broadcast Chiefs Dolphins on Saturday. That was a playoff game this past year. That led to 3 million new signups. Was it only 3 million? That seems low. Well, no, 3 million is what I found. 23 million people watched that game across Peacock and local NBC affiliates in Miami and Kansas City. And then last year's

broadcasts on Christmas all averaged about 29 million viewers. By comparison, just to speak to the NFL's strength, Bucks Nix on Christmas Day drew an average of 2.5 million viewers. So the NFL delivers audience like no other property in all of media and Netflix is going to be delivering it to 270 million people this Christmas. Yeah, I mean, it's certainly a big deal. It's, you know, if you were to go back X number of years and say Netflix has the NFL, NFL, that would be, you know, it would be a big deal. It is one of those things where as they're changing their business with the ad business,

it does, it just, it makes sense. It makes sense to do this. Again, they're not committed to a league, like they're not in the NBA rights bidding, for example. They still don't have the, like you need a motivation to lose money. And I think this bit, and I'm telling you, Matt, David, you're making an industry Chuckery Daily Update as well. It is such a good take. I love it. Get as many people as possible at one time on your ads tier. Or if they want to subscribe for real, I'm sure that's fine with Netflix as well. And then, yeah, get the kids that set it all up, teach them how to do it.

So you know what was actually most interesting to me about this story? There was this note from John Orrend at Puck, fellow Wizards fan, John Orrin, does a great job covering sports media. He wrote, existing broadcast partners became more than a little irritated when, they found out the NFL was engaging with Netflix. First and foremost, many were aggrieved that the league had cut a deal with a new partner only a year after closing a suite of historic and, in retrospect, undervalued, he puts in parentheses, media deals worth $110 billion over 11 years. I'm told that Amazon even put forth a last-minute bid that was richer than Netflix's in an attempt to keep Netflix out of the NFL business. The NFL also considered YouTube a series. serious bidder. Those specifics on that bid are not known. And part of that was because league partners are worried that Netflix will offer advertisers lower priced packages to integrate into its two game

broadcasts. Then that would drive down the market for their own advertising rates. But what do you think of all that? I mean, I would guess they're more worried about Netflix because they're worried about Netflix. They just don't want to deal with them. I mean, it's good to not be in the Netflix competition game, I think, is a takeaway that all these entities have. I mean, it's going to be fascinating, though, to see the numbers. Because, I mean, Amazon has more subscribers, I think, because of Prime, but how many of those Prime subscribers actually have Prime Video installed? Right. Netflix, as for people that are subscribed to watch video, they certainly have the most. And what sort of difference, you know, what does that mean bring to bear? What are

the numbers actually going to look like? It's certainly interesting. But then I think, just by and large, Netflix being in the fray is, I would guess that that's the bigger concern. Now, will Netflix sell cheaper ads? Probably, possibly. I don't know. I mean, it is, you know, but their goal, I think, is certainly going to be to, you know, they're going to want to make money on this, you know, or alleviate their costs to some point. I don't know.

I have a strong take on the ad sell sort of thing other than I expect Netflix to lose money on the games. Yeah. I do think that's probably going to be the case. I think this is about getting their ad network at scale. And that's by far the biggest takeaway from my perspective. Well, and it's also a window into longstanding NFL strategy, which is to spread NFL content far and wide. And even if Amazon wanted to pay more,

it pays to have a Netflix option as well going forward and to have a bunch of different windows where you're putting football games. Well, not just windows, but more competitors for your packages. That's how you get higher prices. Just look at the NBA. Yeah. That's right. They just needed to find that third and then fourth bidder. They are going to triple their rights after all. Okay, one other Netflix note here. I like to leave the incredibly nerdy ad tech conversations to you and Eric Sufurt. So I'll clear out. But just do you have any quick thoughts on the news that Netflix is going to be bringing its ad tech in-house going forward? And from what I recall, this was sort of the long-term expectation, but has the timing surprised you at all?

Not at all. And I think it goes hand in hand with this NFL news. I mean, I think they were kind of telegraphing this when I wrote after their last earnings that, look, Netflix is, you know, I guess they're not going slow to some extent, but they were definitely signaling we have work to do to build out our ad network. And it was only ever going to make sense in the long run if they did it themselves. It just takes time to do that. And so it worked out to partner with Microsoft to start. They're also going to be partnering with multiple sort of ad providers. And they'll be orchestrating that. And to some extent, they will want to get fully into, it's probably just their platform completely.

I mean, the way digital ads do work in general is there's different ways to serve ads, but it can be sort of like a waterfall thing where you serve your ads first. Then you serve ads from another network if you don't have it filled your inventory. Then you fill something else. And maybe that's the sort of approach they're going to take to make sure they have their inventory sort of filled broadly speaking. But no, it's no surprise. it goes, again, it goes hand in hand with the NFL thing. It's just all about building out these capabilities and getting scale. And that's going to take a while.

Building ad tech platforms is no sort of small feat. That's what I was wondering. Is it months long, years long, like five years? No, I mean, well, Facebook and Google are still dramatically changing and enhancing their ad platforms. They've been out for 20 years and way more sophisticated than anybody else. So, no, I'm not saying it's going to take Netflix 20 years per se. But to get to where they want to get, where it's not. not just, oh, I like TV, here's some ads, put them on, but to actually have some sort of tracking,

to have some sort of, ideally they would want to, because again, the goal is not just the NFL. The goal is that they have an at-scale advertising tier with tens of millions of subscribers or hundreds of millions of subscribers. And the way you really pay that off is not just your selling ads like TV, but you can get into some sort of like self-serve interface. Maybe they'll never do self-serve because, you know, it's a little dodgyer as far as like, you know, safety and TV stuff and all that, but they want to have sort of a scalable system that people can not just buy ads, but also know who the ads are being shown to. That's the whole payoff from digital. Netflix knows every viewer. They can measure every viewer on an individual basis and whatever they know about that viewer. They want to build profiles based on what that viewer

views, like what's all the different Netflix content they're interested in. How can they use that to align that with particular demographics or buying things? Now, it's going to be harder for Netflix to get into the conversion part, like how many of those ads actually converted, but they will want to build integrations with third-party measurement firms who do go out and do surveys and do try to tie that stuff together. Oh, yeah. The more stuff they can bring to bear about this, the higher price they can get for their ads. Because the more certainty than an advertiser has, the ad is working, the more they

are willing to pay. That's the end game for all this digital advertising is increasing price per ad because as an Advertiser, you're not thinking about how much an ad costs. You're thinking how much the ad costs relative to the return that you're getting from the ad. So if you can increase the guarantee or the expected value of the return, then you get higher prices. And you also get higher prices by having more people competing for those ads. That's also about expanding the platforms, would have access. And again, it's a long journey.

It can never be good enough. So they're signed up for building a team that's going to be doing this for a long time. But, you know, this is definitely a great way in my estimation to sort of get started. And that's what people should be worried about. They're just worried about Netflix fully engaged, coming from a position of strength into an area that they are also putting all their eggs in, which is sort of this streaming advertising space. Yeah. I mean, the Hollywood reporter laying this news out, they listed like eight different companies that I had never heard of, double verify, Affinity Solutions,

Cantar, ISPOT TV, all of whom work on measurement and verification. So that just underscores the nerdiness of this particular conversation. It's just a world unto itself.

Look, you're the one sitting in a hotel room holding a microphone recording a podcast. It's not just a hotel room, a bedroom. This is very intimate here. But my question for you,

does the NFL, does it just create an imperative within Netflix to get this right? You mentioned Netflix benefiting, even though they'll probably lose money on the $150 million a year that they're spending on NFL rights. Like, how exactly does that help the ad push at Netflix? I think the big thing is, is the challenge they have in particular, well, everyone has this challenge, which is they started out as subscription only tiers and then they want to increase the

prices and they want to catch people that fall through on sort of their ad supported tier. Now, I think this is Ultimately, if you're starting from scratch, I think this is actually backwards. The ideal approach is the YouTube approach, which is free is the default, and then you can pay to get out and how much you pay is sort of a function of what you're worth, right? Like if YouTube premium keeps raising the rates, it's $17, $18 a month now, which suggests to you if you did not have it, that's probably about how much they could be monetizing you for. Now, the challenge, and so Amazon is the one that's where we leaned into this. They had prime video that was part of your subscription. And then last month, they're like, guess what? You get ads now.

If you don't want ads, you have to pay to get out. You have like an extra fee on top of it. And I think that is very smart. Like, there's a bit where I feel like the great irony is all these networks are like, oh, we can be Netflix. It's our content. We have the great content. People care about content.

and then they go into the market and they're overly customer deferential. They're like, oh, we're not going to show, oh, if you want, okay, we started you on this plan. We're going to start an ad plan. If you want to go to that, that's okay. Whereas they should be like, no, dude, give them all ads and then make them pay to get out of it. Should Netflix have done that? I don't think Netflix should have done that because Netflix's value proposition when Netflix did not have their own content. Yeah.

Like, it's very tied up in the Netflix brand. that they are customer first. They're customer-centric. And that made sense in a world where customers were kind of annoyed at the cable bundle. How much am I paying for all these channels and then when your TV and Netflix is like, look, we're pretty cheap. You can get first all the DVDs that you want. Part of the whole DVD push was no late fees, right?

Like you're just whenever you get time and then you go to streaming and where will you sit all at once and been critical about that because I think they're missing out on Buzz to build. But it was part of their brain. which is we give it to you on your terms. That's how we're going to operate. Because of that, number one, everyone followed Netflix. Like, we have to be super customer-centric too. It's like, are you going to win because you're customer-centric?

Because you have good content. These companies try to be everything to everyone. Netflix won because they were customer-centric. Then they got good content sort of later down the road. But so Netflix, I don't think can do that. I don't think they have the sort of the brand permission to just, oh, you're all getting ads now, right? It's like, no, if you choose to get ads, we'll let you have that. But because of that. And Prime, by the way, can do that because people are subscribed.

It's already throwing. Just something else. Right. No, that's exactly right. That's what people are sort of committed to. And I just think that like, is anyone subscribe to Warner Brothers Discovery or describe or subscribe to Paramount Plus? Because you know what? Those are companies that really care about me. And it's really great. No, they're there because they happen to have some show that you want to watch. And I don't know, maybe this overstay in the case, but I think there is a bit where I think this is how Netflix views Netflix. And I think the reality is Netflix was first.

So everybody subscribed to Netflix. And then they've just had a lead on the rest of the field in terms of brand identity for that reason. For sure, for sure. And they have the biggest base subscribers. But I do think that, again, this NFL deal is there's in 75 million households. There's a hundred and some million households in the U.S. This is about getting a lot of the rest of the households. I love Dave's take, getting older people.

I think that makes sort of who find streaming services confusing. I think that is sort of compelling to do it on Christmas, all those sorts of things. But then, yeah, I mean, if you get someone on, even if it's on the ad level, they get used to the service. Why are you paid for it for a month? Might as well watch it for a while. But even better, the more people you have on the ad tier, the more compelling your ad product can be sort of in the long run. There's such a return. That whole bit about targeting.

and figure out who exactly you're looking for. All that works better sort of the larger you are. And they want to get large quickly. And this is the single best content to do that. Okay. So one other note on Netflix before we shift to the rest of the streaming landscape, Matt Bellany at Puck, should talent compensation be dictated by viewership?

And this is from an article headline, The Coming Comp War at Netflix. And he continues, The New Guild Rules provide bonuses for contributors, to top performing content, but a Bloomberg analysis found that less than 5% of Netflix shows and movies would qualify. How about starts, completion rates, maybe the so-called efficiency metric of cost versus performance, customer acquisition, Apple TV Plus, I always stumble over Apple TV, Apple TV plus in its talks with the agencies has emphasized the importance of the latter metric

according to one source in the meetings. So just to put that in context, context, Netflix, when we talk about them buying their way into the industry 10 years ago, they were paying all sorts of Hollywood talent up front. And because they weren't delivering anything on the back end, they were overpaying all this different Hollywood talent. And that also became sort of a blueprint for how the streamers would pay Hollywood stars. And now we're seeing a push. There's not really been anything concrete, but we're seeing a push to sort of restructure the way those deals work. And it's just going to be something to monitor over the next couple of months.

I don't know whether you have any thoughts on it, but it's another case of people trying to get leverage on their costs after everyone lost their mind over the last decade or so. Well, I mean, so Netflix's wholesale model is the model that you want, which is you pay a fixed cost and then all the upside is yours. Now, that was the case for Hollywood, you know, years and years and years ago. and then talent over time negotiated their way into things like residuals where they get sort of money as that as that content is reused over and over again. They can sort of take part in that. And I think I, as I understand it, over the last set, this isn't completely new.

Over the last few years, there has been a shift into some sort of residual like payment structure even for the streamers. But part of the issue was, or something's resold, part of the issue was like, you know, where are the metrics? So it's being shared all those all those sorts of things. And I would say be careful what you wish for. No kidding. The reality is the world of streaming is so much different than when you're television. This is part of why these companies were also insane to sort of abandon this beautiful business model. In when you're TV, when you're on the cable bundle, there's a finite number of channels.

And more importantly, there's a finite set of time. If you're on NBC at 9 p.m. on Thursdays, you're going to be a successful show. Now, of course, those would not work, but that's because they weren't as successful, sort of as they could have been. But when you're on streaming, there's an affirmative customer choice to go watch your show. It's not just because it's on. The customer has to go and watch it. And so what's happening is you're getting more akin to Internet Dynamics. It's not you're in the newspaper that is delivered to people's steps.

So they read it. No, they have to go to your website. They have to click on the article. They have to go see what is being read. And what we see on the internet with the dynamics is you get these very steep sort of exponential curves where if you hit it, you hit it massively large. If your media, you're kind of okay. And everyone else is in the long tail. And the long tail in this case is might as well go on YouTube.

Right. So to the extent talent wants metrics in a world. of streaming, it's going to work out exceptionally well for some of them. And I think it's going to be a real sort of cold splash of water for a bunch of other ones. What I read, Bloomberg analysis found that less than 5% of Netflix shows and movies would qualify. That is, that's that. That's that. It's not an exponential curve. What's the word I'm looking for? Power law, power law distribution, where you, which you see, that is the internet. The internet is all power laws. It's power laws all the way down. And streaming is a power law sort of.

And what drives the power law is the shift to consumer choice. And so consumers, number one, they will find the best stuff. But number two, you do get network effects that sort of kick in. And people talk about a particular show and they get spread around. And the algorithms will pick up on that. Lots of people are watching this. They'll put it in front of other people. There's all these feedback loops to drive these power laws.

And it is like an incontrovertible law of the Internet. Everything is governed by power laws. And the more stuff is in this scenario, the more it's going to be the case. And also, if you're a star making money on the back end from a traditional movie, you go down to a movie theater right now. There's six other movies playing. You open Netflix. There's 5,000 movies to choose from. Of course, then you're going to see depressed numbers in that scenario.

Right. Well, because before the barrier was just to get a movie made and to, get it into the theater. Once you cross that much higher barrier, then yes, there was much more money made. And another thing you see in sort of market after market, right? Say you were selling software in the 1980s, you had to package up the software and be on a floppy disk or whatever might be, had to get into Circuit City or like whatever sort of store PC mall or whatever it would be selling on. And yeah, you would probably sell a decent amount. But the vast majority of people never crossed that barrier.

You fast forward to say the app store, anyone can publish an app. What happens to you can publish an app? There's a whole lot of competition, right? And prices are driven down to zero. You don't have box software that is $50, $100, $200. You have 99 cents if you're lucky or you're free and you have to get some, you know,

hope that you get people to subscribe or ads or whatever it might be. Speaking of the app store, the Apple TV plus it here is funny. Apple TV Plus is just a spoiler. Like they're in there just to muck stuff up and like what sort of works for them. And of course I was like want to use Apple TV plus. When you say muck stuff up, just screw with the economics and put pressure on everybody else? Well, sure Apple's good about like customer acquisition.

That's what they're like like, you know, they want to get people on their platform. But at the end of the day, this came up. I was thinking about this a lot when, so YouTube, YouTube monitor, they share their ad revenue. with their creators. And it gives them an astronomical moat. But it is, frankly, it's tough on the economics. Like you're sharing 60% of your revenue directly with your creators or whatever the number is. And so you fast forward to a world of shorts, YouTube shorts, Instagram Reels or Facebook Reels, whatever it is, TikTok.

And from a Facebook perspective, from a meta perspective, you don't want to compensate creators. Like your whole business model is predicated on you get all your content for free and then you get to have ads around that. And obviously that's better economically. Like who wouldn't want that? And to be clear, YouTube's not paying its creators up front either. No, but they share it to do revenue share with them. So YouTube is talking about, oh, we got to do a revenue share on shorts, right? And it's actually a hard problem because it's what do you attribute the ad to?

Like if you're watching a YouTube video and they show an ad in the middle. middle of it and then you keep watching the YouTube video. It's a good point. If you're watching shorts, you're just sort of watching shorts. You're just scrolling through, right? Yeah. So is it the, is it, do you attribute it to the creator before, the creator after? That doesn't quite make sense, right? It's my wife's Friday nights these days. Shorts and reels. So, so, but I think there's an aspect of YouTube wants to do it, not just because that's also sort of their brand as far as creators go, but also they're in third place. And they can really screw with TikTok and Facebook to the extent. There's an expectation that creators are getting compensated, which Facebook does not want to be in that game at all.

That's a very slippery slope as far as their entire sort of cost structure is concerned. Yes. Well, I look forward to monitoring the next six months as Netflix and potentially Apple TV Plus, which is still such a stupid name. As they try to reorient things, it will be interesting to see whether agents bite because if I were an agent, for a long time, Netflix has been just paying a premium up front. And I would not want to get paid based on metrics if I were representing Hollywood talent. But they all want that, though. But it's so stupid. I mean, and look, their funeral, but we'll see what happens.

Elsewhere, though, to less functional companies, the re-bundling continues apace, Ben. Variety two weeks ago, Disney and Warner Brothers Discovery, ordinarily rivals for consumers' time and money, are teaming up for a triple-play bundle. of Disney Plus, Hulu, and Max. Second, from this past week, Get ready for the next cable-like streaming bundle. Comcast later this month will launch a three-way bundle with Peacock, Netflix, and Apple TV Plus, offered at a deep discount, Comcast Chief Brian Roberts said.

The three streaming services, Peacock, Netflix, and Apple TV Plus will come at a vastly reduced price to anything in the market today, Robert said, although he didn't reveal any pricing details. And that's an everyday pricing, not an introductory pricing, he said. The goal is to add value to consumers in Roberts's words. Comcast's internet was horrible, but as an East Coast guy, I do still have a soft spot for Philly-based Comcast trying to take on the hoity-toity crowd in Hollywood here. What are some of the questions you have as these rival bundles are announced?

what are you going to be watching for? Well, I mean, like everyone else, I am here to make jokes about them attempting to rebuild what they destroyed and get some sort of bundle play back. The big thing here, and I think there was some sort of quote about Davis-Assloff or whatever, basically saying explicitly, yeah, we have to stop churn. Like that is the reason to bundles are first and foremost about churn mitigation.

If you're watching, Hulu, you are less likely to cancel Max if you bought it altogether, right? It's not I'm going to get rid of my bundle and subscribe just to Hulu, right? Like there's a certain level of like friction in that process. Oh, I guess relatively speaking, I'm only paying an extra $2 a month for max or whatever. Now, the challenge with bundles and putting them together is figuring out who contributes what to the bundle. Like, like what is and the the key thing here is like what's sort of the churn mitigation contribution that goes into this. And that will be, that's why you don't have these emerging sort of naturally.

It's also why this peacock Netflix Apple TV plus one is very interesting because one can imagine Netflix is giving up a lot less to be in that, right? If your peacock or Apple TV plus, you want to be with Netflix because they're the one that people are going to keep. And on Netflix's part, it's not going to go in a third. a third, a third, a third, because you're bringing so much more value to it, I would think. And this is particularly interesting because a decade ago, people were shocked when Netflix started being sold by cable companies. So you could, through Xfinity or whatever it is, you could subscribe to Netflix.

What Netflix always kept, though, and this was actually a big warning thing for me because I was very surprised that they would give up the billing relationship. It wasn't the billing relationship that mattered. It was, they always forever and have never faltered from, you only get Netflix content through the Netflix app. They will always own the user relationship. They will always own the discovery mechanism for their content. They get what the aggregator value is. It's what the customer actually interacts with.

And this is about the same time or a couple of years later, the original Apple TV, there's a lot of Apple TVs. So this was when Apple TV, the TV app was going to surface all of your content. And Netflix refused to join in on that. And rightly so, because that would have compromised their access to the customer on sort of a UI basis. That is what matters the most. So, anyhow, that's a bit of a digression. It's just interesting that back then Netflix saw Comcast bringing them value by helping them acquire customers and whatever might be. and now this seems clearly to be the other way in which Comcast sees Netflix bringing them value.

And I'd imagine the financial relationships are more to Netflix's favor than they were sort of back then. And to what extent is this Comcast saying, screw you, Disney, we're not going to let you bundle us out of the market here. We're going to work with Netflix. We'll give Netflix a sweetheart deal and we'll be the re-bundlers. I don't know. I mean, who knows? That's the way it was framed in a report I saw. And I enjoy the back-and-forth rivalry there. It is kind of interesting.

I mean, I think Netflix or Comcast is to say they do have the bell of the ball. They're with Netflix. That's going to be sort of the most compelling bit. I still don't really understand Peacock, to be honest. Like, why is the cable company putting football games on a service that means you don't need cable anymore? You know, it reminded me, I was reading about that this morning a couple years ago. It was the 2021 Olympics. We weren't working together, but you were just baffled by the fact that NBC was taking the Olympics and shoveling it on to Peacock.

Will you be equally baffled this summer or has the horse left the barn at this point? Oh, I'm still baffled. My bafflement is continuous. I am existing. It's like if there's sort of like a quantum aspect where you have like multi, you know, multi-un universes going on. Have we given up on them making rational choices? Right. No, exactly.

So my peacock observing self, one of my sort of. multi-modality, multiverse sort of things. Omni Bent Thompson. It's just continually baffled. It's floating in a state of bafflement. I check in with it every now and then. Most of the time I can conduct my life normally. But it's probably a bit of a risk factor.

If I'm driving down the road and suddenly peacock bed comes out, I mean, like, get a car accident or something. We promised loopiness on this podcast. Didn't know you were going to the multiverse, did you? Yeah. Well, all right. So as far as churn mitigation is concerned, two questions. questions I have. Number one, when are these companies going to go to one year contracts? Because that

would make it much harder to churn if you're signed up for a year, obviously. You do have to put a much bigger price in front of people and get them in the door. And then the other thing is, if churn mitigation is the goal, as long as these streamers are offered as standalone services and you can cancel on a monthly basis, you're unlikely to get like the full benefits of what re-bundling would potentially offer. You know what they should do is they should make their content only available in one bundle and they should all be together. And there's no alternative.

Should it be? Should you put a wire? A wire you get a higher quality and then you could sign like you could have people have to sign multi-year contracts. Do you have a technician come in and get a, you don't need this. This is what I'm saying. Don't half ass it if you're re-bundling, all right? You know, just shutter, Peacock entirely folded into a real bundle.

This is part of the whole thing about, like, honestly, I've been saying, yeah, the bundle is going to go to rebundle for ages and ages. And there's just, there's a bit here. They all need to fail. And once they fail, then they can actually figure it out. Do it in earnest. Yeah. And the funny thing is, with all these bundles that are showing up, maybe that will help with term mitigation, I think they're going to run into customer acquisition challenges because it's

like, it's just so confusing. This is the thing. We hit this point with streaming services too, but at a certain point, there were so many streamers that people couldn't even keep track of what products were available. And now we're hitting that point with bundles. I mean, we've got the sports bundle, the venue is how it's pronounced. Is it venue or I thought it was like venereal or something? Yeah, well, no, it's not venereal.

I don't think it will be all that much more popular than Venereal, but it's spelled B-E-N-U. Does Warren Brothers still be in it if they don't have the NBA? Apparently so. Apparently they're moving forward with Warner Brothers Discovery regardless of what happens with the NBA, which we're not even going to cover on this episode. I do think there's a bit like if you do an annual plan,

what are you going to do? You do a big discount, right? I think when you're mocking all these up and you're doing your projections and work, how much are we going to spend on, you know, you go back five, six years, you're like, no, we don't, those discounts take a big chunk out of your revenue. And so you're like, no, we don't need to do that.

Like, like, or we don't. No one is incentivized to do that because no one is taking seriously how much customer acquisition costs and what a challenge term mitigation is. Right. And there's a lot of motivated reasoning. There was a lot. These companies decided to do streaming. and then they backed into the economics,

which meant when they were figuring out the economics, all their assumptions and motivations assume that streaming was going to be a good idea. If they had actually started by figuring out how much will it cost acquire customers, how much churn are we going to deal with, what sort of discounting or bundling offers are we going to have to do?

It wouldn't have penciled out. They wouldn't have gotten into streaming. That's how we know it's the case. So now that they're already there, they've burnt all the bridges, they've jumped over the deep end, they're having to back into all of this stuff. So yeah, we probably will get annual deals. We will get sort of different things that figure out.

And all along, they're just going to be bleeding customers because it's so freaking hard to find something to watch. Yeah. Yeah. I mean, this whole thing, you have to, we talked about at the beginning, you have to affirmatively choose to go watch something as opposed to sitting down and something's on. That, I'm not sure that has even yet been. fully internalized how difficult that is.

How difficult what is, how difficult it is to market a streaming service in that. No, how difficult it is to have content that people feel they need to watch and need to pay for. Not just that. They, okay, which service isn't on? Oh, wait, am I subscribed to that? Oh, now you're going to have a huge, you're going to have decision fatigue, right? People are down like, oh, there's that new show on Peacock I want to watch.

Wait, isn't there, did I hear something about a Peacock bundle? They're going to go online. They're going to research. Oh, what's the best way to subscribe? Oh, there's an offer with Verizon. You sit down and suddenly they forgot about the show. They're not like, like this is a, I think this is another factor in general. The e-commerce companies know this very, very well.

But all these people get in this space don't understand, which is every bit of friction you have in your conversion process, it costs you so much money. Like, one of my big beliefs. And I, evidentiary, shows a lot of people don't agree with me, but whatever. I have never offered a sale in strategicity, ever. The price has only ever gone up.

It has not gone down. It will never go down. Why? I'm sure I would get a big leap if I like, oh, one day offer, sign up, blah, blah, blah. But what I don't want is every other day of the year where someone's like, oh, well, maybe I'll wait until there's a sale or I'll sort of do sort of X, Y, Z. I want when they're at the decision point where they're considering subscribing, they know for a fact that this is the best deal I'm going to get. And I want to limit the sort of, no, I don't

have a big team doing measuring and stuff like that. Maybe there's a way to fully optimize it, sort of XYZ. But I do think this bit about decision fatigue and consumers thinking, oh, well, how do I get a deal? They're actually going to make that worse now. No kidding. It's not just going to be a one decision. And you talk about internalizing realities. The one reality that I do think that they have internalized is that turn mitigation is just an ongoing crisis for everyone who's not Netflix. And in order to make meaningful progress on that front, the only way to really do it is to say, all right, you're signing up for a year here. Or we're not offering a standalone service anymore. And this is how you subscribe to us. Because otherwise, the real challenge is once you lose a customer, getting that customer back

four months down the line has proven to be really difficult as well. And so it's the core crisis here. And I just don't think that these half measures are actually going to address it. You know what the solution is. What's that? The real bundle that actually solves all these problems. It solves your churn mitigation problem. It solves the password forgetting problem.

It solves the where do you find stuff problem is you just sell your content to Netflix and then everyone can log it in Netflix and they can get your content. Maybe. And you don't have to do customer acquisition. You don't have to do churn mitigation. You don't have to run your own tech stack. You can do what you're actually good at, which is making content. And that's where we'll end up eventually.

Just who knows how long it will take. Yeah. And as long as you're comfortable with Netflix, eventually just squeezing your profit margins. Sorry, that's what's going to happen. Training the life out of your industry. But yeah. It's true. But what's the alternative?

Well, the alternative is about eight different bundles for people to keep track of. Right. So you just kick the can down the road. Off front, something new to sell. Do I want to suffer from like, do I want to bleed out over a matter of years or bleed out in a matter of months? They're choosing the month option. Yeah. Well, it'll be interesting to see how many other people choose these monthly bundles.

I guess it's more years versus decades, but whatever, yes. Yeah. Well, we'll see. For now, I'm going to give you a choice. We have two sports questions. I also watch the movie Her and have a couple thoughts on my experience. Let's do this NBC question. I think that's a good one.

Okay, so is that from Ali? Yes, from Ollie. All right. Ali says, hi, I'm a football fan. Yes, the one centered around a foot and a ball. NBC splits the Premier League games across its cable and streaming service. I end up paying $10 for Peacock and $70 for cable via YouTube TV. Why doesn't NBC milk me directly for $50 and take 100% of the share?

P.S, I'm a Gen Z and Euro and I don't need cable. otherwise. I feel like that was sneering directly at me. Ali emailed me six months ago, lecturing me about how he doesn't need cable. What do you think, Ben? Why isn't NBC squeezing Ali for all he's worth? I mean, it sounds like Ali does need cable because he's paying for it. That's what I responded to Ollie. Who's sneering at who here, I think, is the question. I mean, the problem with charging direct is you are only going to acquire people for whom your content is the most important thing or willing to pay $50. So Ali is taking a very self-specific view of the world, assuming everyone is like

him and saying, why don't you give me the product that I want? And the reality is the way you make more money is not just by selling it to people who want your content, but by selling it to people who I wouldn't pay $50 for the Premier League, but if it's on, I'll watch it, right? That describes me to a T. Yeah. And so, like, this is the whole sort of your second. your casual fans.

That's what you want to monetize because every sport, except maybe the NFL, but almost every other, even the NFL, every other sport, there's way more casual fans than there are hardcore fans who will pay to the degree of $50. And actually, you can make the case, NBC is very effectively segmenting its market here. It is getting Ollie for Peacock. And then he's also on cable TV. Most of their audience is, I would assume, the ones that watch via cable TV, that's on NBC or sort of or USA Network or whatever it might be.

So the, you know, there's a bit where Ollie is the sucker here. And let's be clear, all us sports fans are the suckers. We're the ones that are going to end up paying for freaking everything to sort of get to it. But there, the idea at least in theory is, and again, this is why the cable bundle was so good. You had everyone, you were, yes, you would complain about paying for networks you didn't watch. but you were basically forced to be a casual fan of every other network. You were helping to sort of pay for it, right? And sports viewers were the biggest beneficiary because ESPN made the most money.

It went to sports leagues. There wasn't this segmentation of sports fans. And I've been predicting this, Ollie, for a long time. The end result of all this sort of split up of the cable bundle is that sports fans are going to pay more. Time for you and I to pay up. No, it's true. That's exactly what's happening because that is the most motivated audience, which is why the NFL is splitting the rights everywhere.

Because guess what? NFL's fans are going to figure it out and they're going to go out and pay. Yes. Well, here to that end, we have Ravinder. He says, this is Ravinder from Seattle, a tech and avid sports fan writing to express my frustration over the fragmentation of sports streaming services and questioning their long-term strategy. I follow various sports, but I'm finding it hard.

catch up with all sports now as streaming rights are divided across multiple platforms disrupting my viewing experience. In the U.S., tennis grand slams are split between ESPN and the tennis channel, NFL games across YouTube TV, Amazon Prime, and Netflix. European soccer mainly on peacock, NBA is soon to follow suit on peacock, and then MLS is on Apple. I believe this strategy alienates casual fans like myself. Hence, I'm questioning this overall long. term strategy by sports giants as they are signing 10 year contracts. How is this a good thing for the end customer? Won't they lose viewership or growth in the long term?

P.S. I'm someone who works in tech and feels comfortable in managing multiple streaming services, not sure about novice users, which probably makes up the majority of the viewership. Do you have thoughts, Ben? I mean, again, a PS that really amuses me because it's like, it's fine for me. And it's like, how is this good for me? It sucks for him, it sounds like. And I'm not a novice either, but it sucks for me.

It's hard to keep track of where games are on any given night. Try finding Fox Sports One. And yet he does it. Yeah. Well, I mean, not happily. But that is the reality. I think there is, this is just the, this is what we are bearing towards. The internet is forcing it towards is sort of the reality of the matter,

which is in the analog world there were so many things that were fuzzy. We didn't know who like go back to my example of like someone writing in a newspaper, right? You had a sports columnist in every city and all of them thought they were great, right? Like I, you know, I had a big guy around town. I show up at the football game and everyone gives me deference because I'll write, you know, something mean about them. In retrospect, all those guys were great. What's that?

In retrospect, all those guys were great. Just a cigar, leather jacket. No, it's true. You get online and actually there's like two calmness in the whole country that matter. Yeah. Because that like when you, it's actually you should be careful what you wish for when you get to sort of the cold heart reality. And this is honestly a bit for Ravindar and other people that might have once complained about the cable bundle. You should be careful what you wish for.

What happens is when you're exposed, when everything becomes transparent, when you lose the sort of like, fuzziness of analog, stuff gets segmented very harshly. And in this case, what is getting segmented is the sports fan and their willingness to pay? You are getting squeezed absolutely for every last time. Is that bad for the leagues in the long one? Yeah, I think so. Like, it absolutely is a question about acquiring sort of new customers and new fans.

Someone who's, you know, you go back to all these points, no one who doesn't watch soccer is going to, oh, we pay $50 and suddenly start watching soccer. I'm just going to decide to become a hardcore Premier League fan, although there were Americans who did that in the early 2000s and just declared. I'm a soccer fan now, but yeah, that doesn't really happen. I mean, speak for your own sort of like, you know, East Coast neuroses when you were growing up for whatever it might be. I'm just saying it happened. We were all there.

2004, a lot of Arsenal fans out there. But no, or Tottenham was a big one too. That's the key is the leagues know this. It's not like Ravinder is shining a light on a challenge that the leagues aren't aware of or a hole in the strategy that they're not anxious about. But they have no choice but to do this and segment where they're putting their products because that's where the money is at this point. It's where the money is shifting. Yep. And I do think like I think some of the most interesting stuff about this issue are around the edges.

Like you see more and more leagues as the RS ends are completely falling apart, which were just pure money grubbing. sort of for a long time, given how few people watch them and how much they charge. And now Diamond's going bankrupt. All these companies' deals are falling apart. Then they're like, well, I guess we'll put our games on broadcast TV, which I think is actually great. It's a great, like you have this extra inventory. Ideally, that pays off in that there's more fans. The team benefits directly because more fans come to game.

The league's benefit because they will then get cable or they'll get peacock or whatever it might be to watch the big games, all the big. big games are going to be sort of on for pay and national TV. I think that's actually a pretty overall, a decent strategy. It's taking times for different teams to sort of get there over time. But I think, again, if there is a big theme about this podcast and about what's happening and streaming generally, it's like, welcome to the internet. It's like, yes, you kind of knew the internet existed.

But when you fully got online, all the brutal realities of internet economics are coming to bear on your business. Right. And it kind of sucks. Well, and you mentioned the America of yesterday when there were 50 different columnists in every different market and then you get on the internet and there are two winners. There are two winners in this world. Netflix and the NFL.

The NFL is just unstoppable no matter what happens. And Netflix is in great shape and will only be in better shape 10 years from now or however long it takes for them to build out the ad capabilities to make them. even more dominant in that space. Yeah, I mean, and we'll see, you know, who else makes it amongst the streamers. I mean, uh, Peacocks is pretty determined for better or worse. Obviously, Disney has, you know, Disney has a lot of breadth of content with Disney and Hulu and ESPN, especially when it goes online.

They have been early to bundling. They've been bundling their services for a while. They've been talking regularly in earnings call that about how it reduces churn and all those sorts of things. They're putting like Hulu in the app now. The ESPN Plus content is going to be in the app. Imagine once ESPN itself launches, they will do that. And they're sort of recreating their own bundle.

But it is definitely a challenge here where as long as it's spread out like this, it's hard. You're not getting the full benefits of the bundle, but you're also confusing consumers. You're losing casuals who will just, I can just go watch YouTube or I can watch Reels or whatever sort of it might be. And you never make the new fans of the future. So, so, Ravity, you're not wrong. Right. As you said, that's... And it's hard relative to a business that was subsidized by a bunch of people who didn't watch sports.

No, yes, that's right. That's the problem. It's a wrenching transition, but it's like one that you're locked into now. Yeah. And it's very relative. And everyone is stuck trying to prop up their old revenue models because it's hard to sort of take a hit. Look at the NBA. Clearly in this world, you need more events is best.

better than just inventory. So they get the last big TV deal, which again, all the fighting is mostly about the playoffs because that's the actual sort of event sort of things. And you see ESPN's willing to pay more as long as we still get the finals, oh, if we lose regular season games,

whatever, that's fine. Like there's no real value sort of being attached to that. The NBA should take this opportunity to shorten the schedule and lose revenue there, but make up for the TV revenue. Are they going to do that? No, probably not, because they have the 30 teams.

They have to, They have to heard. Right. And I'll decide to like do like there is a bit where part of the NFL's benefit is it is a singular entity. They only have national TV deals. They don't have local deals. Everyone gets the same amount of money. So everyone is unified and working as one.

And that's just a harder thing to organize and pull off sort of elsewhere as well. Well, I look forward to continuing to monitor the landscape. Can I close with a couple thoughts on her? Yes. I watched for the first time. You did watch her. I've never had this sensation of my podcast partner. watching her. So this is the first. Yeah, I know. I feel bad. I'm departing from the legacy of James here. Did

you like the movie, her? I did. I liked it when I saw and I watched it again like last year and I still liked it. Okay. So I, I really enjoyed it myself, but I wish I had seen it in 2013. I have five notes here. My first note is I wish I had seen this 10 years ago because watching it in 2024, there's so much collective anxiety about the way humans interact with technology that from the opening minutes of this movie, it like triggered all sorts of annoying think pieces and back and forth arguments that, you know, we've had on this podcast to some degree. Oh, great.

I'm good to know. I've associated with the annoyingness in your head. It just felt like work and stress-inducing watching it. Like, honestly, it was like in the same way that I don't want to watch. pay to watch it. I don't want to watch a movie about the pandemic after what we lived through and how just dreadfilled everybody was for two years there and how just miserable those two years were. I don't want to watch. I don't care how good your show or movie is. That was part of my problem with watching her in 2024 because now all the technology is real. And in 2013,

it's like maybe that will be possible. Now we're like a step away from that being the reality here. And I don't know. It's just a lot to process. You're stressing me out. You get a point number two. Okay. Point number two, I didn't actually mind the tech itself. The aesthetic of her.

It was like, what if the entire world looked like an Apple store? And that's the aesthetic of Open AI also. And I don't love it. Yeah. I can definitely see that. I think the other thing, this isn't necessarily aesthetic related. But to the bit about the thing, technology. Number one, he never

charges his earpiece, so I'd like to know what magical... I was wondering about that. But that number two, it overlays into the I'm going to use my voice for everything, right? Like he's doing like he's like the writing greeting cards or writing personalized notes, right? I guess that works for voice,

but yeah, there was a bit where it leaned a little... But that said, it was sort of... What I did like about the movie is it wasn't too futuristic. It was more like, what if we'd drop this in and he's still going on a train. He's still sort of doing walking through his station or sort of X, Y, Z.

Like there wasn't like flying cars or whatever, which I thought sort of helped make a little more more compelling. Well, yeah. And you know what else I liked is it was obviously about human nature and the way humans interact with technology. But it wasn't too prescriptive about anything. It was just sort of having fun with the idea, like what if this technology existed? This might happen. This might happen. and it was kind of lighthearted in spots.

It was also deeply sad in spots. I mean, what it did get right is it leaned into, I'm sort of recalling the movie now as you're talking. It's been a while since I watched it. But one of my takes about AI is one of the mistakes I think people are making in predicting the future of AI is they're looking for AIs to be like humans and like do like these complex tasks and like do a good job. And my feeling is what's going to be very very.

compelling is have is the parallelism of of aides you have a bunch of ayes doing something all at the same time and so you can iterate more you can figure out a solution faster you know it's gonna be a different way of working the analogy i take is like cpus versus gpues like literally there's a hardware they're running on is representative of i think the most you know the case you go back to is like facebook and google generating ads right you can generate a bunch of ads and try them out ab test them and see what works you have like that's the perfect condition to bring this parallelism to bear.

And the reason why this is good is because, like, why does he get mad at his AI? Because she's dating, like, multiple people all at the same time. AI parallelism. That's right. Yeah, dating 600 people at the same time. Yes. Well, no, and I just, it was, it could have been, like, if someone tried to make that movie today, it would have been so much more heavy-handed about the dangers of this and how

dark it was. And Spike Jones, he struck a pretty neutral tone. And the aesthetic, it just was, it's so clean and sterile. And I had seen the Sam Altman tweet like an hour before I watched the movie. Us versus Google. I was just thinking about our aesthetic. One of the biggest lies in the history of technology, I don't think much about Google. Oh, God, yeah.

Give me a break. Every year, set your watch. Oh, guess what? We have a new event coming up. Google I.O. Is that the day? before Google. Oh, my, I never think about them.

I had no idea. You know, speaking of which, that movie watching it, it reminded me of my most frequent Google use case, which is watching a movie or show and Googling an actor or some detail about the movie. And I did that watching her because I was looking at them walking around. And I was like,

it's set in L.A., but that looks like Shanghai. Like, it's got to be Shanghai. And then so I Google an AI overview. tell me that her was filmed both in Los Angeles and Shanghai. So there you go. By the way, this is one of my, I have a travel hot take for you. Okay. So I arrived, I'm in the U.S. right now, obviously. I arrived via JFK. Which people will say, you arrive in JFK, oh, how

embarrassing. It's sort of like this, you know, it's sort of dump your little hallways and you're filtering through and you know, you emerge and it's, you know, I just was in Asia and they had these amazing, beautiful airports. Wow. America's really in decline. And I, I actually have the countertake, which is JFK is an example of why America is great. Because airports just don't need to be palatial. They work fine, right? No, we are good at, we are good at allocating capital. We spend our money elsewhere.

We spend our money at Google I. No, no, we, JFK has built what, the 50s or 60s or whatever it was. It used to be called, you obviously called something else back then. And it works. And yes, it gets too crowded and stuff. It has to be rebuilt. They rebuilt LaGuardia. It's beautiful by all accounts, and they're not going to touch it for the next 60 years.

And in 2016, people are to say, man, I can't believe LaGuardia is so embarrassing about it. You know what? It's still going to be working, God damn it. And we'll be putting all our money into cool new technology that you are going to use every minute of your day instead of the one time every five years that I fly to JFK. Well, and speaking of Shanghai, China has a lot of unbelievably nice empty airports. Yes, that is exactly what prompted it. China. Not so great at capital allocation. But great at airports, you know.

We can take a couple of notes. It created a good future 16 for the movie, which was probably better than L.A. Yes, absolutely. All right. Final notes here. Lots of adult content in the AI-centric future were shown in her. And I don't have a specific take on that one, but it reminded me of an email we got from a listener named, I think, SB, who said, I understand both you guys are married with kids and probably don't want to talk.

talk about this on the podcast, but just objectively speaking, there's a huge VR opportunity in adult content. And that's something to be accounting for going forward. Which Apple doesn't play. Well, and he was like, maybe it will be in a quest. Maybe that's an advantage for the quest going forward. You can hear me stammering. I don't really want to talk about adult opportunities in VR or AI. Well, I mean, the good thing is we want to have that awkward scene where the assistant brings in another woman. Yeah. Because it'll just be a robot.

Well, there you go. Robotics, the future. All right. Most importantly, my takeaway, I am out on voice assistance. That particular UI is not going to take over in the future. And I feel like I've been sort of soft peddling my opposition to it as you talk about voice assistants on this pod. But man, I don't want to live in a world where we're all just shuffling along and mumbling

to a voice assistant all day long. And I don't think that we're going to do it. Do you have thoughts? I think you just ascribed a position to me that I don't hold. Is this a mouse in the pocket sort of? Well, no, I mean, the whole thing about talking to your AI and everything else, this was like six months ago on the pod. No, my point is there are compelling experiences.

you can have, but the latency has to be low and it has to be like, it has to be seamless like it is in the movie. I agree, though, that's not going to be, like there will be, we will still have Wimp interfaces, we'll still have phones that we touch. Okay. I don't think we'll walk around talking all the time. It will be layered on top, but I think the mistake you see again and again is people assume, oh, it's just going to replace X, Y, Z.

What happens is we do both, right? We still use regular computers. You still use the command line. You just furtively sort of mumb. to your assistant here and there when when convenient? Sometimes it's convenient. Like if you're walking around or doing the dishes or by yourself or whatever it might be or, you know, checking out the new robotics.

Okay, but you're with me that you don't want a society where that's how we're all living all day long? Yeah, no, I don't want people mumbling sort of around me all the time. Okay. Well, the other thing is I don't really worry about that as our reality because Samantha reminded me of your description of Sydney, where she was feisty and kind of interesting and fun to interact with. And I don't think the big companies are never going to let that happen. They're not going to get it. They're not going to get it to us. I think we can all rest easy here, you know?

If Sydney was, if Sydney was the default, it's pretty incredible to think how much different things might be. Yeah. Well, and that's, I wonder whether we'll ever graduate beyond the. sterile generic answers that have just become the baseline for everyone at this point. Because there is, I mean, I understand from a company's perspective, the worries about how that could go wrong and the different types of liability that opens up. But at the same time, I just can't imagine interacting with the sterile chat GPT voice who, look, I didn't hate the voice as much as everybody else. I heard you on dithering and you didn't hate it as much as everybody else. So I didn't really understand that whole. I was. Yeah. Well, and by the way, that's the other thing that puzzled me is the movie, I enjoyed it, but it was like deeply sad.

So I don't understand the tech community's reverence for this as some sort of aspirational vision. The longstanding tradition. When we find sort of a dystopian model that says, do not do this. The tech company says absolutely we're working on it right now. That's so cool. I mean, all lowercase Sam, her as the demo is playing on Monday, I'm like, I don't know if that's the way you want to ask. advertise the future, but I guess that speaks to the ongoing insularity. One of the all-time movies about the tech industry is what was Aaron Circus movie, the Facebook movie. Social Network. The social network, which there are people all over Silicon Valley that are there because

that looks awesome. That's not what Aaron Circon wanted. That's what happened. Sorry. I mean, like, social network was good and really got it some deeper. truth, I thought. But yes, I mean, that the deeper truth is not really Mark Zuckerberg as he actually is. But for it has been stuck with that for a decade. Hey, look, I've really come around on Zuck. Yeah, that happened with Wall Street also. But no, same thing. It was supposed to be this cautionary

tale and everyone's like, wow, that sounds amazing. How do I work there? Yeah. Well, good. On that note, as we get loopier and loopier here, it's time to get to our birthday party and we will be back later in the week. Not for us. A mutual friend. So save the, save the well wishes. We're already in a hotel room here. We're not having a joint birthday party. But happy birthday, Kirk. But we are coming back Wednesday. And Ben, I will talk to you soon. Unfortunately, we won't be in person Wednesday, but I'll talk to you at a couple days. Talk to you later.