The Best One Yet - 🚕 “End Surge Pricing” — Lyft’s anti-surge pivot. Michael Kors’ Team USA. Disney’s subscription math.

Episode Date: August 11, 2023

Lyft is trying to end Surge Pricing — But for every business Yin there is a business Yang. Coach is buying Michael Kors for $8.5B — But it’s really about American fashion vs European fashion. And Disney just jacked up the price of Disney+ by 27% — So we whipped up a new thing… Subscription Arithmetic. $LYFT $UBER $CPRI $TPR $DIS Want merch, a shoutout, or got TheBestFactYet? Go to: www.tboypod.com Follow The Best One Yet on Instagram, Twitter, and Tiktok: @tboypod And now watch us on Youtube Learn more about your ad choices. Visit podcastchoices.com/adchoices Hosted on Acast. See acast.com/privacy for more information.

This is Nick. This is Jack. It's Friday, the real Friday, August 11th, and today's pod is just the best one yet. It's a T-Boy. I am sufficiently barbified, Nick. Are you fully barbified? Hey, Barbie. Hey, Barbie.

Oh, Barbie. It's a fantastic plot, and I love a good story. But it's also hilarious every scene that Ryan Gosling is in. Can you talk to me about the Allens? Jack, how many Allens did you see over there? There's only one Allen, and he was something to remember. It feels like a sequel. Shredding waves.

more dangerous than people realize. So Jack, what's the first story for today's pot? For our first story, Lyft wants to kill the one technology that everyone hates the most. Surge pricing. No more $287 trips to JFK. For our second story, Disney, just up the price of Disney Plus by 27%. So Jack and I have whipped up a new math, and that math is streaming math. We're going to crunch the streaming numbers for you. Subscription arithmetic. And our third and final story, handbags are expensive. But Michael Corriss was just bought for $8 billion.

We got a showdown on the fashion runway. It's America versus Europe. America versus Europe. It's Europe. I'm just going to call it Europe. It's Europe. But Yetis, before we hit that wonderful mix of stories. A fantastic mix of stories, Jack.

Fantastic. We have an early birthday shoutout at the top of the program. We got a birthday. Who we got, Jack? Who's the happy birthday to today? Happy birthday to hip-hop. Happy birthday. to hip hop. Hip hop. The musical genre turns 50 today. Hip hop. There are actually five pillars of hip hop. We got

graffiti, we got breakdance, beatboxing, DJing and emceying. True thing. Yeties pass the gin and juice. Estes add the salt and the pepper. Because hip hop was born at a party exactly 50 years ago in the Bronx. Get this. August 11th, 1973, New York City, South Bronx. Jack, can you set the scene for us over there? A man named DJ Cool Hurk did something with the turn to tables that no one had ever heard before. DJ Cool Herk tied together the highlights of each song into a continuous loop-de-loop-loop-de-loop. And the effect on the dance floor was electric. Nobody knew it at the time, but this was the birth of hip-hop.

That was the first DJ remix. 50 years ago, hip-hop was born. 50 years ago, hip-hop became a thing. But yet, he's, in the last 50 years, hip-hop has gone from music into serious, Moneymaker. Hold the mics from beatboxer to billionaires. From boys to men? See what we did there? In 1986, RunDMC wrote a song that was sponsored by Adidas. Yeah, in 2014, Dr. Dre sold his startup to Apple for $3 billion. Jay-Z, Kanye, P. Diddy, all billionaires. Jack, the notorious B-I-G, he had a GDP. Nick, 50 cent? More like 50 billion. I got 99 problems, but monetization

is absolutely not one of them. Yet he's on this 50th birth. we're going to quote Veronica Chambers. Rap music at its core has been a 50-year love affair with the English language. Couldn't have said it better. Hey, DJ, let's hit our three stories. It's hammer time, Nick. Snoop Dog to Doja Cat. Jack, let's do it. Fourteen years before this song, two boys from the Northeast met in the dorm.

They had an idea that caused a cultural storm. It's the best one you need to practice. 50% that's a fat tip. Tea Boy City on your at list. If you know, you know, because we're ready to go. We can't wait no more, so just start the show. Start the show. For our first story, Lyft, just announced it's trying to kill surge pricing.

But in business, every yin has a yang. Jack, if you and I had to find the one technology innovation of our lives that everyone universally hates, what would that innovation be, man? The subject of this story. Yeah, it would be. Surge pricing, the meanest algorithm of all. Millennials hate surge pricing more than they hate having to take a phone call or find a printer or write in cursive or read in cursive. East Village to West Village $73 for that Lyft ride? You've seen it.

Lyft CEO said this yesterday and it was shocking because it's so core to their business. It really is, Jack. And what was his quote? He said that consumers hate surge pricing with a fiery passion. Yiddies, when it starts raining, the prices start popping. If it's starting to sleet, the prices will surge. We've all been on that corner, haven't we, Jack? Yes, we have, Nick, which is why Lyft and a net. yesterday, they're trying to get rid of surge pricing. They don't want your Lyft to dinner to be more than the dinner. So Lyft just announced that prices last quarter were down 5% overall because there was

35% less surge prices. But yet, here's what Jack and I found fascinating about this story. We all hate search pricing. But search pricing is misunderstood. Yeah. Economists actually kind of love search pricing. Search pricing is like kind of an economist dream, to be honest with you. Because search pricing is when supply and demand balance each other out in real time. It's an economic kumbaya. Lyft and Uber, they increase prices when there is too much rider demand, but not enough driver supply. So riders hate it when prices double, but drivers love it when prices double.

Because if you're Henry with a Honda and you see that surge pricing's going on, you're going to get in your car, you're going to jump on the road, and you are going to start driving for Lyft ASAP, aren't you, Jack? And if enough Henrys with enough Hondas turn on their Lyft app, that brings the market into balance. Yeties. As riders, we hate surge pricing. But you know what we would hate more? Not having a ride. And without surge pricing, you probably wouldn't find a ride because there wouldn't be enough cars out. There would be no Henry. There would be no Honda. So, how is Lyft suddenly going to kill surge pricing? Well, so far, Lyft has just gotten lucky. Yeah. Layoffs in economic uncertainty

has more people driving for Lyft to make side cash right now. Last year, we told you, Lyft is a downturn diva. It does better if there's concerns. about the economy. More people will drive for Lyft. So driver supply for Lyft right now is up 20% compared to last year, which kept the amount of surge pricing down last quarter. Now, Jack, what will Lyft do if the number of drivers falls on the platform? Or what will lift do if the demand spikes and they need more cars out there? They haven't told us. They haven't told us what they're going to do instead of surge pricing.

They don't really know. In the meantime, Henry's having a blast from that Honda, and Jack and I have got a takeaway. So, Jack, what's the takeaway for our buddies over? Over at Lyft. For every business yin, there's a yang. Yeti's Lyft is sympathizing with the riders here who despise surge pricing. With less surge pricing last quarter, the average price per ride fell by 5%. And get this, riders love that so much, the number of riders on Lyft actually jumped by 9%. But you know who hated the 5% lower price last quarter? Who was that, Jack? The drivers who get paid by the price. Yeah, Lyft, they're trying to stand out with a strategy of ending surge prices for the consumer.

But the cost of that strategy could be Lyft's relationship with drivers, which is crucial. Because Yetis in business, just like in Chinese philosophy, every yin has its yang. For our second story, Disney just announced it's jacking up prices at Disney Plus, and it's going to crack down on password sharing. With so many prices of so many streamers going up these days. They're all going up, Jack. It's time to crunch the streaming math. We got to do some subscription arithmetic.

We're going to bust your binging budget. But yeties, in order to sprinkle on some context here, meet the new Bob, same as the old Bob. Disney and Bob Iger just announced earnings this week. Disney's cable TV revenue is shrinking. Its movies have been flopping recently. Plus, people are going to the Amalfi Coast, not the Magic Kingdom. Disney, it's looking less like Disney, more like Bush Gardens.

Burns! Burns! The stock is down 22% in the last year. It's Bush League. What is this? Lake compounds? So Disney just announced yesterday, no more Mr. Nice guy when it comes to Disney Plus. No more Mr. Nice Mouse. They're going from Hero to straight up villain on your credit card bill. Disney is jacking up the monthly price for Disney Plus by $3 a month starting in October. Yeah, evil stepmother over there.

And they are stealing Netflix's most devious trick. They're going to block your niece. The next time she tries to log into Disney Plus to watch some Toy Story from your account. Now, Yetie's Jack and I, we got to pause the pod for it. second because jack we got to talk about our binging budget let's talk about that for a moment pull out your credit card bill what kind of stuff are we seeing nick i'm seeing a 27% increase for disney plus a 20% increase for hulu and netflix has more than doubled their price since they launched and what is going on over at hbohmacks my friend they have maxed out at 20 bucks a month if you want to watch the sopranos on hbbbohmacks that's a whole lot of gabagoo you got to be paying no discounts if you named your son max

either. Jack, you used to work at the Olive Garden. That's like three pasta dishes for one monthly subscription. That's right, Nick. When you're here, you're not, fam. You were trained well. Yeties, we know the feeling that you're going through because we're going through it too. You're feeling like a frog who's sitting in a pot of boiling water. It used to be nice water. You were like swimming, you're having a good time. And now it's like expensive water and that water is actually hurting you. Hey, Larry, what's going on with this water? I don't know what I'm schvitzing like I never schvitz before, Jack. Yeties, when you cut the cable cord like 10 years ago, you were like, wow, I'm saving a hundred bucks a month.

I'll never forget it, Jack. Our buddy Timmy walked in and he bought all those groceries with the money we saved by cutting the cord. But with five and a half streamers you have now, monthly prices going up and no more bumming off your aunt's Netflix anymore. Subscripturation is starting to cost you. Are we even saving money anymore compared to when we had DirecTV? It's a question Jack and I had in the middle of the Disney earnings. And the answer is our takeaway. So Jack, what's the takeaway for our buddies over at Disney?

We just did the streaming math for you. Yeties, the average cable TV plan is $83 plus a whopping $45 of fees, which adds up to $128 a month. $128 a month. That does not include Internet, but it does include a commercial like every eight minutes. So since it includes all those Jeep and prescription commercials, We compared that $128 a month to the ad-supported internet streamers out there. And the average ad-supported streamer, Nick and I calculated, is about $8 a month.

All right, so Jack, let's do the break-even math on this. What do we get? Unless you're paying for 16 streaming services right now. Or eight fancy streamers without any ads. Then streaming is still a better deal than cable TV is. Up to 16 streamers, and you're still better off than cable. The frog's getting warm, but he's not getting burned yet. Despite Netflix and Disney Plus, doubling their initial prices.

But Yetis, with the media industry under pressure to turn a profit, we think more price hikes are to come. And when they do, Jack and I will be here to do the streaming math for you. Because when you're here, you're famo. For our third and final story before the weekend, we just saw one of the biggest deals in fashion in years. But this story is really about America versus Europe. But Jack, if we're going to talk about the fashion, fashion industry. Can I ask the question that everyone is wondering right now? Can I ask it to you? Sure. Who says Long Island can't do fashion, man? Are you saying that, Nick?

Oh, I am not. Can we introduce you to Michael Coors, born in Merrick just off the L.I. NASA County. I think that's on the Babelon line, right? Like second to last stop on the Babel online? Make a left at Hopog and you're gone too far, Jack. Don't quote me on that Babylon line, by the way. Michael Coors, the legendary fashion designer. half Jewish, half Swedish, 100% blue steel. They went to the Fashion Institute of Technology on 26th Street in Manhattan. And then he started sticking his name on purses and stuff. Stuck a lot of initials on those purses.

He's dressed Michelle Obama. He's judged Project runway. Jack, did you see Emily Blunt at the Met Gala? Did she have an M.K. logo on her dress? She might as well have. And so should have the red carpet. Well, Michael Corr has termed his, what's the word, eponymous brand? Is that the word?

Let's roll with it. He turned his eponymous brand. into Capri Holdings, a holding company that owned lots of fashion brands. Like Michael Coors, an accessible luxury house. But here's the news. Michael Coors has been bought for $8.5 billion by Tapestry. The deal should be at least three times bigger, Jack. Tapestry owns Kate Spade, Coach, Stuart Whiteman,

and now they own Michael Coors too. Tapestry, their head to toe to handbag. If you're walking around the Upper East Side, someone is wearing every tapestry brand right. No. eponymous. But Yetis, here's what Jack and I found fascinating about this story. Jack, I'm going to ask you another question here.

What do you do when you feel threatened? When I feel threatened and insecure, I buy a new cute top. And then I strut my confidence back into me. Well, Yeties, that is the same thing that's going on with this exact fashion deal. These American brands, these two companies, are teaming up to take on Europe. It's Paul Revere versus Napoleon, but in the fashion industry. Because the biggest fashion company in the world, by far, is LVMH, which is also Europe's most valuable company. Louis Vuitton, Moe, Hennessy, $500 billion company.

Their CEO is the second richest man on Earth. And LVMH has been on a buying campaign. They've been eating up American fashion brands. LVMH owns 75 different brands. Many of them are American fashion brands that they acquired along the way. including Tiffany's, Sephora, DKNY, even Rihanna's Fenty are owned by LVMH. They're all American brands and they're all owned by Europe. And if you go beneath LVMH, the second largest fashion company in the world is also European.

It's called Caring. They're $40 billion, but they own Gucci and Balenciaga and Eve San Lorenz. Add it all up, Milan, Paris, and London. They dominate the fashion world right now. Don't include Dussledorf in that group. They don't belong. Later, Hozen, don't belong on a runway, Jack. So, Jack, what's the takeaway for our buddies over at Michael Corris? American fashion needs to unite or get conquered.

Yeties, Europe's fashion houses are owned by major conglomerates, corporate empires. The U.S. fashion houses have been splintered, scattered, and scrambling in the meantime. Europe's fashion houses benefit from their efficiencies and their co-de-naissance. The U.S. fashion houses are thrashing, and kind of struggling right now on their own. And because of that, American brands have been getting picked off by Europe like pocketbooks for years. And that is why Michael Coors is selling to coach right now. Strength in numbers, because divided we fall. Like Derek Zoolander, allying with Hansel to take on Bruno.

One fashion mega house buying another fashion mega house, Milan? Not involved. Call this merged company, the United States of accessories. Jack, can you whip up the takeaways for us for the real Friday? Lyft just announced they want to get rid of surge. pricing. How? They haven't said. Well, for every business yin, there's a yang. For our second story, now that Disney Plus is $3 a month more expensive, we did some streaming match. Unless you got 16 streamers, streaming is still cheaper than cable. And our third and final story, Michael Corr's parent company,

just sold to Coach's parent company. It's the United States of accessories, because if we're divided, King George wins. But this pod's not over yet. Here's what else you need to know today. First, forest fires in Hawaii have swept across the island, killing at least 36 people in Maui. It's the deadliest forest fire in five years in the United States, and the entire town of Lahaina has been burned. Besties, we got a lot of you in Hawaii, hoping you're okay, hoping the best. And second, we just got the consumer price index for July. For the first time in 12 months, inflation, it actually increased a bit. But despite gas prices rising, overall inflation is still pretty chill at 3.2%.

And finally, the average Manhattan rental apartment just hit a record price of $5,58. I think that's why we still have inflation. The price of renting on the Lower East Side is now 30% higher than before the pandemic. As always, the rent is too damn high. And yes, you have to pay the broker fee. Now, time for the best fact yet. This one sent in by legendary Yeti, Rachel Hauer running all the way across Wisco. If you've watched Spider-Man recently or have ever worn Crocs, you know Post-Belone, the rapper.

Yeah, Post-Malone. He's the rapper with the tattoos on his face. Now, Post-Malone, shocker, isn't his real name. His real name is actually Austin Richard Post. But, Jack, where did he get the name? Post-Malone, exactly? From one of those rapper name generators. Remember those?

Those are fantastic. Remember we used to do the Wutank Clan rapper name generator? That was a lot of fun. Yeah. I'm known as a silly turkey. If I type my name in there. I'm known as Gecko McHafferphy. Yeah, these, we got a link.

to the website to the Wu-Tang Clan rapper name generator in our newsletter which you can find at news.t.tboidpod.com. If you want your rapper name, check out our newsletter, news.totteboid.com. If you don't know, now you know. Yet he's Nick and I. We'll see you Monday. Have a fantastic weekend.

And before we go, a happy birthday to Josh Kaplan down in Miami, the king of the creator economy. And happy birthday to Lauren Cantor, a New Yorker living it up in San Francisco right now. And a happy birthday to Natalie Quarplett. Turnin' 27 down the street in San Francisco. Happy 30th birthday to all them chambers in Boston Mass.

Just doesn't Boston. And Tony Vodal is turning 62 down in Richmond, Virginia. Not too shabby. Happy birthday to Akbar Kamani in Atlanta, Georgia. And Mia Spire just delivered her dissertation at Oxford, and she's got a birthday. Happy birthday to Amelia Simmons, celebrating in Dallas, Texas. And Rowan Allen, happy sixth birthday over in Indiana. Happy birthday to Tony the Papa Tamasi in Waterford, Michigan.

Jude Yang, enjoy that second birthday over in Illinois. Happy birthday. Happy birthday to Jude's parents, too. And Sam Mott and his puppy Enzo are turning 25 in the car on the way to work over in Virginia Beach. And congratulations to Nick Alves for doing his first therapy appointment right around now. Because we brought up on the show. There you go, Nick, not too shabby. promo code T-boy.

And congratulations to T-Lavis. to Tara, Rafael, Fred, and Arda, who are all graduating from beautiful Pepperdine University. From good old Grazie Adio Business School. And happy six-month anniversary to Tori and Brandon down in Connecticut. Let's make it 12. And Alyssa Gibson and Randall Madison are college sweethearts who just got engaged.

Send us some ring picks. We want to see this thing. Congratulations to Kelly Gazeric and Kalyn Shone, who just got engaged in Bowler, Colorado. And Jack, one year ago, we gave Bonnie and Stephen from San Diego A special shout out for their wedding. It looked fantastic. But you know what that means?

Happy anniversary to Bonnie and Stephen. This is Jack. I own stock of Disney and Netflix, and Nick and I both own stock of Apple. Eponymous.