The Vergecast - RIP DVDs

Episode Date: September 27, 2023

Today on the flagship podcast of the laserdisc resurgence:  While Netflix’s DVD.com service shuts down later this week, The Verge's David Pierce chats with Bill Rouhana, the CEO of Chicken Soup for The Soul Entertainment, about the potential of Redbox and physical media in 2023.  Netflix’s DVD service shuts down: here’s the complex tech behind it Later, David and Alex Cranz talk with New York Magazine’s John Herrman about his recent story on social media metrics and what they actually mean.  Lies, Damned Lies, and Social-Media Metrics Keep listening for this week’s Vergecast hotline question.  Email us at [e-mail] or call us at 866-VERGE11, we love hearing from you. Learn more about your ad choices. Visit podcastchoices.com/adchoices

Welcome to the Vergecast, the flagship podcast of The Laser Disc Resurgence. I'm your friend David Pierce, and I am at a red box kiosk near my house outside of a CVS. I confess I have never done this before. I've been watching DVDs since, like, I had one of those DVD VCR combo things, and back then the only DVD we had was Clueless, so I watched it like 65,000 times. Then my family was a pretty early Netflix house. So we had those red envelopes coming and going all the time. And then somewhere along the way, I gave away my DVD collection and just went all in on streaming.

There was a piracy phase in there, too, but we don't have to talk about that. But now, here I am at the Red Box, because this kind of feels like the last bastion of the old DVD era. Like, I'm looking at this, and I can get DVDs of Asteroid City and the Super Mario Brothers movie. And Shazam, which I definitely won't do, and Cocaine Bear, which I might do. and this just feels like an era that's ending. DVD.com, which is the name of Netflix's old DVD delivery service, is shutting down for good this week. Oh, and quick PSA on that front, actually.

If you're still a DVD subscriber, put all your favorite movies at the top of the queue right now because you get to keep everything you have when the service goes down. So do that as fast as you can. But with that gone and streaming still really ascendant, even though it's kind of a mess right now, I just wonder what's going to happen. Is physical media just dead?

Is it going to have a huge comeback like vinyl did where everybody's suddenly buying albums again? I really don't know, but I'm very curious about it. So in the first part of the show today, I am actually going to talk to the person responsible for this kiosk I'm standing in front of. That's Bill Ruhana, the CEO of Chicken Soup for the Soul Entertainment, which now owns Redbox as of a year ago. He has, it turns out, some surprisingly strong thoughts on the subject. After that, we're going to switch gears a bit and talk about metrics, the numbers we see everywhere online, especially around video. views and what it means that everyone reports those numbers and none of it really seems to have anything to do with anything. All that is coming in just a sec, but first I got to pick a movie here,

right? We've got a bunch of Spider-Man's, John Wick 3, Plain, which I don't think I knew was a movie until right this second. Oh, they have Dungeons and Dragons. Okay, Dungeons and Dragons, Honor Among Thieves, rent DVD, $2.25, or I can buy it for $3.99. I'm buying a DVD. Let's do this. All right, taking this home, here we go. This is the Vergecast. See in a second. Support for the show comes from Retool. Too many companies run critical operations on duct taped spreadsheets,

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We all need to retool how we build software. What's up, y'all. I'm Skyler Diggins, seven-time WMBA All-Star, Olympic gold medalist, and mom. And I'm Cassidy Hubbard, host and reporter for nearly 20 years, covering the biggest names and stories in sports and mom. And this is Am Mom, a community for athletes, game changers, and moms of all kinds. Dropping May 14th.

Tap in with us. Welcome back. All right, I got a movie, I made it home, and then I realized I don't own a DVD player anymore, which was a problem for a second. But then I realized that's why game consoles exist. Someday I will own one of those little small discless ones, but for now, I have an old Xbox One and a PS4,

both of which have disc drives. So I am wired up and ready for movie time. But for now, let's talk about the future of those discs. Redbox is probably the biggest brand left in physical movies. DVD.com, obviously dying this week. Blockbuster is long gone. I don't think anybody goes to Best Buy or Walmart to buy movies anymore, right? And Redbox just kind of seems like the last game in town. And Redbox actually got a new owner last year. It's called Chicken Soup for the Soul Entertainment, which also owns the streaming service Crackle and Popcorn Flicks, plus it has film production and

distribution companies. The company paid $375 million for Redbox last year, which a lot of people thought was totally bonkers at the time, and still do, frankly. But Bill Ruhanna, the CEO of Chicken Soup for the Soul Entertainment, is convinced that physical media is not dead, or at least is not dead yet and won't be dead anytime soon. So I called him up to talk about why he thinks this is a good business and why he's betting on discs even when his own company is in the streaming business, and maybe most of all, why he tried to buy DVD.com from Netflix before it shut down. One thing you should know before we get into the interview, Bill uses the terms A-Vod and S-Vod a bunch, and A-Vod means ad-supported video on-demand, and S-Vod means subscription video on-demand.

Av-you-pay with ads, S-Fod, you pay with money. Fairly simple. I just wanted to clear that up in case you hadn't heard it before. Anyway, let's get into it. What was interesting to you about Redbox in the first place. Oh, really many things. Let's start with the brand and the very loyal customer base spread out across the country that hadn't probably hasn't fully migrated to the digital world for a variety of reasons, not the least of which is some places they don't have bandwidth that's enough to be able to download movies and watch them without a circle of death, you know, to make, to make the experience miserable. In some cases, they're just laid adopters. In other cases, they can't afford the internet or they can't afford the kind of internet that's required to be able to do

digital downloads. They're movie lovers, they're entertainment lovers, so they're highly motivated to consume the stuff that we have. I mean, I can go on and on and on about this. There were many things. The starting point was the brand, the 42 million people in the customer loyalty program, the beginning of the foray into the digital world, the ownership of a very large transactional video business, which is very hard to start. And then the kiosks, which in my mind, someday, I hope to prove this, would be generators of significant cash flow if handled correctly. That could be the cash flow machine that allowed us to build our digital business out over the next decade. The audience is one that I'm particularly interested in, because we've been talking a lot about

who physical media is for in 2023, right? And I think a lot of people look at that audience and say that audience is dwindling really fast. It's much smaller than it used to be. Most of those people are going to one way or another find a way to get into the streaming era. So we're just going to kind of leave that audience behind and trust that they'll eventually catch up. You went a different way. Or maybe you think that's true, but there's money to be made along the way. Like, how do you think about sort of who that audience is right now? Well, I think it's the people I just described, people who are not able to have access to bandwidth who can't afford it. is another category. It's smaller, but it's likely to grow of people who say, wait a minute,

I'm not getting the same quality out of a digital download that I would have if I had the physical disc and I had all that additional capability to see things more crisply. I know some people who won't watch a Bond movie unless it's on a DVD. It has to be Blu-ray and it has to be the top-nash, because they want to feel every bit of it. This is early for this conversation, but at some point, this probably takes the turn that e-books took back to physical books, that downloads and music took back to actual albums where people started to differentiate a little bit and you had this growing cohort of people who thought, you know, quality is important too. And I get a much higher quality picture, a much higher quality experience if I actually have the physical media,

which is so much more richly packed with information. Oh, and then there's all this other stuff that comes with these DVDs that, you know, you might want to actually have seen, you know, so it's, you know, all the extras that you get that you don't get in a digital download very often. For us, it's really about giving you access to first class, top-notch, current content from any studio at the lowest possible price, the earliest in the ecosystem after theatrical that you can do it. And so there's something that we're meeting a need that's a little different than that collectible, lead, that's for sure. Right. Yeah. And I think that piece of the kind of windowing that you're into is part of the thing about your strategy that I think is so interesting, because it seems to me that

you know, you have Crackle, you have Chicken Soup for the Soul, you have Red Box. Everyone else is kind of out in the streaming industry fighting about content. Everybody's making shows and spending more and more money throwing it into their own platforms. It seems to me that what you're building is this sort of every step of the way distribution pipeline. That's correct. Rather than saying we're going to throw a bunch of money at David Fincher, you're trying to get in sort of every step of where content is. Is that a fair description of how you think about this? It is. And I mean, look, we thought and have always thought that understanding what consumers want is most easily achieved by watching what they do. And if you want to watch what they do, you have to be in that first line of consumption so that you see what they do. And one of the things I loved about, and still love about Redbox, those 42 million people in the customer loyalty program, give us a group of people who we know, we know who they are, and we know when they're places,

and we can learn what they like. And eventually, artificial intelligence can help us, I think, figure out how to serve them stuff on the home screens of our networks that are tailored to them. By the word, I will repeat the word eventually, because we cannot do that today, nor can anyone else, no matter what they call you. Yeah. Yeah, everybody's doing a lot of voodoo that I think doesn't add up to much in a lot of cases. No, not yet. So was that part of the thinking with Redbox that you can get this very early sense of what people like and what's successful and that informs like what ends up on, you know, crackle months or years later? Yes. So from one perspective, that's what it was about. And, you know, if you think about it, the kiosks, transactional video, the fast business, the age,

Avod business. We have some subscription stuff, but it's not really our focus. I don't think that's a particularly good business right now. But having so many different places that people interact with us as they consume, it is very valuable. It is a great bit of information that other people don't have it. And actually, other than Amazon, there really isn't another company with as many connecting points with consumers in the media space as us. We are a very unique beast. And that's all intentional. That was really what I was looking for as I put in these pieces together. We haven't taken advantage of that yet, David. We haven't yet integrated all this stuff in a way that we know how to smartly take advantage of what we can do.

But we've certainly set the stage for that to happen. Because we have the early access all the way across a wide number of things. So that was the plan. There's a flip side to this too, by the way. If you're thinking about creating content and you want to make sure that as you created, you're doing it in the least risky way, having all this information about what is consumed in these various ways, like what works at the kiosk, what works in Tvod, what works in Avod, what works on fast, that informs your thinking about how you will commit to content creation. And a lot of times,

because you're the first dollar in a lot of these places, you have superior economics to people who otherwise were creating content and would have to go through your system and you get a piece of their revenue. So if you believe, as I do, that ultimately content and distribution are irrevocably and completely tied to each other, it is the kind of ecosystem that allows you to actually lower your risk and create content over time and get the most money back from it. And it completely blows away the theory that an S-Fod standing by itself is a good idea, because it isn't. And everybody's now figured that out. We've done this. I've been talking about this since 2007. that the S-Fodd business was a disaster waiting to happen.

Do you think physical media keeps being part of that equation over time? I mean, if you play it out a ways, more people have broadband, the windowing system maybe changes so that there are fewer ways to get stuff, but it's still kind of you get the $20 downloads instead of the DVD rentals and stuff like that. Do you think there's a place for physical media in this long term? I do. If only because experience tells us that inertia is a very, is the most powerful force of all. And changing people's habits is really hard to do. Now, COVID broke a

lot of things, right? It forced people to change their habits. One thing it did is it accelerated the digital transformation dramatically. But if you looked at our business and understood the assumption we made about what would be successful in the physical space, we said we expected the red box kiosks with a full full of the content that it used to have prior to COVID, would do 30% of the business that it did in 2019 before COVID. With that very low expectation, we were highly profitable. Okay. Wow. Which was why I thought this was a good idea, that even if two-thirds or more of the people had changed their mind about consumption, and that's a pretty aggressive assumption that two-thirds of the people have changed their habits, that would be amazing. Then we would still

be profitable at 30%, and that is further enhanced, I'll say, for lack of a better word, by the fact that we have a couple of other businesses that make the kiosks profitable at a lower level than that from things other than just rentals. We're putting screens on top of them and selling digital out-of-home advertising. We have a business that's built around the service company that services our red box kiosks, does break-fix of them and does the, the merchandising of them. We now do that service for other big kiosk owners. And every time we add one of those customers, we bring our costs down to service our own kiosks to the point that I think by the end of next year, we'll be close to zero net cost to actually run our own kiosks from a servicing

point of view. And that changes the business entirely. So if you took a one-dimensional view of this question and said, hey, DVDs are going to go away over the next 10 years, how are you going to analysts, I would say, okay, great, let's start with the fact that I believe it's at least 10 years because of the way people's habits are. But let's also be smart and think about the ways we could make that less relevant to our success. Let's use these kiosks in more diversified ways. Let's bring down the cost through the service business. Let's figure out what the right price increases might be over the course of a decade to help make up for some of the lost customers. And when you look at it on that kind of amalgamated basis, you start to realize, hey, it's relevant that physical media

is going away, but perhaps less relevant than people thought when we bought the company, which is why we are crazy, but not for the reasons people thought. That's fair. So if that's the timeline you're thinking about, do you think Netflix is nuts to shut down its DVD program now? I mean, if we're in a 10-year time horizon, they're really jumping the gun here. I think if you're them is a wholly different analysis. this is such a tiny little thing in a gargantuan business. That's fair. It's not strategic.

It's more like a pain, you know? It's not like it has any, in any way, affects your core business. Not at all. So the kind of, I mean, the better question is, why keep it? You know, the bigger question is, why didn't you just sell it to me when I tried to buy it? Because I could have created a whole bunch of synergies out of that business, you know? So why didn't they sell it to you? I don't know.

They just didn't even return our phone calls asking about it. Really? We told them we wanted it, but they just, I think they just want it gone, you know? It's a distraction for them. Sure. What would you have done with it? Well, I don't know that I would have bought it, but, you know, if they returned my calls, what I would have looked at was, can I create operational synergies and keep the cost

slower and drive additional revenue into this portion of our business? There's a whole other question lurking here, which is, who else is in the retail and media business. Can you think of any companies like Amazon, for example, that might be in the retail and media business and have found ways to make those two businesses work incredibly well together? People tend to have sort of a very single-minded view of almost everything. And if you kind of challenge that single-minded view, you know, they go off the rails, so they kind of lose it. But, you know, there are examples of the retail business and the media business is working very well together. There are examples of them not working at all. Walmart.

And voodoo was not a good example of it. No. No insult to Walmart. They just are, they're not a media company. They're a retailer. That's what they are. Amazon, God knows what they are. They're just awesome and everything they do, which scares everybody to death.

But, you know, they're really good at what they do. So, look, I don't think does enter anything inherently contradictory about being in the two businesses. If you know, if you know how to be in them. There are a couple of other companies I've learned of that are similar. This is a company called Go Digital, which is a company I like very much is. in both sides of the, both in retail and media, they make it work. So I think it can work. That's all. Yeah, I think part of the reason I'm curious about kind of the hypothetical of what you would have done is it seems like, you know, it goes back to what you said about Red Box at the very beginning, right? It's a really good brand. People know it. There are a lot of people in the program. And it seems to me that if you take the idea of this is a very accessible brand that gets new stuff, there are a lot of ways you can go with that. You could just do Red Box by mail. And I don't know if the economics, work for a lot of the reasons you're describing, but that's a thing you could do. Or there are,

you know, you could start selling movies to people through Red Box. It just, there are so many sort of splinters off of this thing that is Red Box, this good brand that people know and are used to interacting with, especially if you're betting that physical media as a thing is going to be around for a long time, that's an increasingly not competitive space. And it feels like if you wanted to sort of branch out from Redbox into we just want to own all of the ways that you get, acquire, and watch physical media, you could have pretty big ambitions there without a lot in your way, right? Yeah, I agree. Well, that was part of the reason to look at the Netflix DVD business, too.

I mean, you know, if we had gotten the opportunity, if we'd gotten the opportunity to have a conversation about it, we would have then analyzed whether it made sense. We'd never got to that point. I just thought there were a lot of inherent possibilities in that, you know? Yeah. What do you think about DVDs and Blu-Rays in particular? Like, I grant you, this is getting pretty far in the weeds of physical media here. But I think I was thinking a lot about the vinyl thing today in prepping for this,

because it's telling to me that we didn't go back to CDs and we didn't go back to cassettes. We went to vinyl because that is the object. It feels better. Like, if you're going to buy the physical thing, that is the best version of it. It sounds the best. It looks the coolest. It has the most kind of cultural history. Like, that's the one.

And I wonder if we're going to get some of that same stuff for movies and TV shows. Are we going to get a new format? Are we going to go back to, like, is VHS going to come back? What's your sense of Blu-ray and DVD's kind of staying power over this next decade? I think it's Blu-ray DVD. That gives you what you need, you know? We're not getting laser discs back? This is all a way of winding up to say, can you please bring laser discs back?

That's what I mean. You don't think so. But partly it's because, you know, you've got an embedded base of equipment that's quite extensive where the DVD can be used and the Blu-ray can be used. And, of course, there were a lot of turntables, even though they weren't really running that much. People had them and they were dying to turn them back on, you know, to get them back and get the, you know, the quality of, and I guess the feeling, you know, of that. Yeah. Do you think there are ways we can make physical and digital stuff interact better over time? I remember years ago talking to people who said, you know, if you buy a DVD, you should also get the digital download so that you can watch it on the devices that don't have DVD players. And especially now, I mean, people watch a lot of stuff on devices that don't or can't connect to DVD players.

It's true. Are there ways to kind of put those pieces together? Yes, there are. But I don't know if that's a game changer. But I think it's, you know, an incrementally better world. If you can put those two things together, I think it's good. But the things that drive our business. And now, look, you're asking me a generic question. So, you know, what do you think about this as a general principle? I always think about it, what does it mean to my business?

I can't help that. That's what I do. And, you know, so when I think about it from our business's point of view, what drives our business is the fact that we're the least expensive way to get first-run movies. That's what drives our business and get them right very early. and get them from every studio. If you look at only any of the streamers, not a single one of them

can deliver you first run movies early from every studio. They can deliver theirs. Sometimes they can deliver one other guys, but nobody can deliver everybody's, except we can. Or you can get it through transactional video, but that is so much more expensive

that for a large chunk of people, it's prohibitively expensive. I guess the question then would be If that's the thing, right, if you pull it all the way down and say that the thing that we have is cheap ways to watch first run movies, what do you press on customer experience-wise to make that better? Is the answer more kiosks so that it's quicker to get to? Is the answer, find ways to make it even cheaper? Is it find ways to convince Netflix to put its stuff on DVDs so people can get it? Like, what's the next turn if there is one in how to do that even better? I think that the thing that drives the business is always content. Sure. And getting the most content as quickly as possible is the key. And here's where the window word, which you've used a few times already and I've ignored,

becomes an important word. Sure. You know, because getting an organized window strategy from the studios so that consumers know what to expect would be a very good thing for everybody. You want to make this experience better? make it clear to people when they can expect to see these things. I mean, right now, the media business has destroyed itself between taking television and breaking it into 5,000 pieces

and making it impossible for people to figure out where to watch things and going through layer after layer of search to try and find stuff. Between that and the fact that the windowing strategy of the various studios are completely, they look ad hoc to me. They don't look like strategies. they look like, you know, just, hey, let's see what happens, you know. That is not good for the consumer. We have not made life better for consumers in either of those ways.

And good, solid, understandable windows, which are, you know, you don't have to be slavishly adherent to them, but which generally are followed is a huge service to the consumer in terms of understanding when to expect to see something. It's mind-boggling to me that this is not returned faster. So the best thing I think we could do for consumers is come up with a windowing strategy that actually everybody abides by so that they know when to look for things.

Otherwise, they're just kind of like wandering around going, I don't know, when does this come out? Why is Barbie out this week and Oppenheimer out this week? Weren't they in the theaters at the same time? Why are they six weeks apart? I don't know. Universal and Writers. Okay, great.

Do you as a consumer care, which studio made the movie you want to see? I don't think so. What you care about is when is it available, and do you know how to find it? No, I agree. And I actually love that example because I think the Barbenheimer thing

with such a phenomenon that there are going to be a lot of people who want to get both of those movies and watch them in the same day. And that is going to be so stupidly difficult for so long. It is. It's really ridiculous. So silly. We've got Barbie coming to the kiosk within the next few weeks, which we're excited about. There you go. But Oppenheimer's not coming to the kiosk until November, or maybe even later. I don't even know at this point. It doesn't make a ton of sense. It's not smart, but this is part of the COVID recovery of the media business, trying to come back to a new approach. With COVID having driven so much digital, you know, take up, it changed everybody's, you know, kind of focus in the media business to digital, digital, digital. And now as we

start to realize, well, wait a minute, it's really not that smart to only have one way to monetize your movie when you should, you could have seven, you know, or six or whatever it is. And you And one doesn't cannibalize the other. In fact, a lot of people like to watch it in all those different forms. It's adjusting to that and changing who's in charge in these studios is really, really taking the time. Because when you really get right down to it, this is just a fight between different parts of the same company as to when they're going to do things. How long are I put it in the theaters? Where is it going to go next?

Is it Tevod? Is it, you know, you got a different guy who runs Tevad that a guy who runs the DVD business. Right. And they hate each other. Yeah. Right. And then there's another guy who's licensing this stuff. You know, this is like a free-for-all trying to figure out whose turn is it? You know, every studio is going to go through this in their own way. And then there's just Redbox, kind of kicking it increasingly on its own. I mean, does it, does it feel like this is a competitive space at the moment? Like what you look? No, we're at. Okay. We're all that's left. Do you think that's going to change anytime soon? If we get kind of a push back towards some stuff you're talking about, are you going to get new competition? No, I don't think so because the physical presence that you have to create to be in our business is so vast. And we have 30,000 kiosks spread out across the entire United States.

You've got leases with people. You've got to be able to service these things. We're not going to have any real competition. What is interesting is the growth of kiosks in general in the country is amazing to me. I mean, there's kiosks popping up all over the place. That's good for our service business because that's lots of customers for us there. and I think that's going to be one of our great businesses. All right. Thank you. This was really great and really fun. I really appreciate you taking the time.

It is my pleasure. Nice talking to you. We got to take a break, and then we're going to talk about numbers. Big, ubiquitous, meaningless numbers. We'll be right back. Support for the show comes from Framer. Framer is an enterprise-grade, no-code website builder, used by teams at companies like Perplexity and Muro to move faster. With real-time, collaboration and a robust CMS with everything you need for great SEO, not to mention advanced analytics that include integrated AB testing, your designers and marketers are empowered to build and maximize your dot com from day one. So whether you want to launch a new site, test a few landing

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That's upw-w-rk.com. Upwork.com. Welcome back. We talk a lot on this show about numbers, what it means to go viral and how creators use numbers and metrics to understand their business. And just what it means to be a person when everything you do and post and see has a million numbers attached to it. And all of these numbers seem so, if not meaningless, then at least really hard to make sense of. Like, can you compare a YouTube view to a TikTok view to an Instagram view? is doing that even useful?

And how do you make sense of any of it when everyone knows at this point that so much of it can just be gamed in one way or another? Well, our friend John Herman, over at New York Magazine, recently wrote a column that basically made the case that all of these numbers are nonsense. It really resonated with me, and it kind of made me wonder what we do now.

So I asked him to come on the show and talk about what it means that the internet is just swimming with numbers, most of which have nothing to do with anything. I also grabbed Alex Cranz because we can't talk streaming numbers without Alex Cranz. Let's get into it. John Herman, welcome to the Vergecast. Thanks for having me. Alex is here too.

Hi, Alex. What's up, David? John, can you just like sort of run down the thesis of your piece for somebody who hasn't read it? Like, why did you write about why Twitter views don't make any sense? I mean, I'll take any chance to write about weird metrics. I feel like this is like a trick that I use like a few times a year for a decade now where it's like, hey, there's a number out there.

that doesn't really make any sense. If you explain that number to people, everyone else will be like, oh, wait, that's what that means. The thing is, that way of, like, measuring everything in ways that are kind of off and manipulative and misleading

and serve all these different purposes is becoming more and more a part of just, like, the fabric of daily life online. Like, everything that people use in any social network, in a lot of non-social context, just in their software,

is sort of counting what they're doing and returning it to them with higher and higher numbers that are meant to sort of suggest that you, they're sort of meant to inform your behavior or make you feel good or make you feel bad like you need to do something else. You're just surrounded by these numbers all the time. And it's just this background part of your online life. But as a lot of stories start these days, there was a ridiculous tweet. Was it the Tucker Carlson thing? Yeah.

Yeah. So Donald Trump and Tucker Carlson kind of counterprogrammed the Republican primary debate. with an interview on Tucker Carlson's show, which if you haven't been following this, is now, I guess you would say hosted on X. Like exclusively? Yeah, he's just blogging and posting it straight to X. And the interview happens, the debate happens. The debate gets like 12, 13, 14 million views, according to Nielsen, which is its own can of worms.

Fox comes out and says like, yeah, I don't know, 15 million people watch this if you count the streaming and stuff like that. No one really cares. Donald Trump comes out and says, hey, actually, we got like 230 million views on my interview, which is nearly as many people as living in the entire United States. That number kept going up and up and up. Eventually, it's like 300 million people. And, you know, he's pretty loose with numbers. You sort of, you want to revise down a lot of Trump numbers. That's we're kind of used to that. But in this case, he was just actually citing a metric attached to the tweet. under Tucker Carlson's video. And it really did say at the time I wrote the article, it was like 265 million views for what was like, you know, Donald Trump has given a lot of interviews and he's given interviews to Tucker Carlson.

This was like, I'm sure, very interesting to quite a few people in a variety of different ways. It is not something that everyone in the world or everyone, more than every voter in the United States, it's just like completely implausible. Everyone knows that's ridiculous. But it's not just, you know, kind of like a notoriously misleading public figure doing this. It is the platform saying that's what happened.

Views. A word that we're supposed to interpret like in some sort of way. 265 million. A big number that exists in the world. So I don't know. That doesn't make any sense. That's the kind of thing that you would expect to hear from like tabula or outbrain talking about how their chumbox videos are performing.

And instead it is like being. cited by the former president directly on still very influential social media platform. So just kind of want to walk back from there. Like, that can't be real. Of course it's not. Twitter internally tracks video views. And if you use the Twitter for Mac client, you can still see those views, which Elon Musk had removed.

The real number of views on that was like 12 million or 15 million, about the same as the Republican debate Nielsen ratings, which, again, a big number. However, that number is tracked after, I believe, two seconds of video playtime anywhere on the screen, which if you ask someone what it means to watch something, no one's going to, unless they work in advertising or something, no one's going to be like, oh yeah, well, if you look at it for two seconds and then scroll past it, you watched it. Like, that's the opposite of watching it. However, that is the Twitter video metric. somehow Twitter is now measuring something that is like that is like 50 times less rigorous than that and telling everybody that that's how many people are seeing something. And, you know, it's funny, it's silly, it's a specific example. It is also how the entire internet works right now.

There are just these bullshit numbers absolutely everywhere. They're all bullshit in slightly different ways. They're all kind of like, you know, fundamentally bullshit in the same way. But they're all these like different stacks of invented measurements. They're frequently compared to each other. They're frequently touted for marketing. They're used to just sort of like contextualize conversations about something. I mean, is that true or are they mainly used to sell ads or like convince people to buy ads, right?

Like like saying, oh yeah, we got 300 million views. Don't look into the numbers, but we got 300 million. You're going to get 300 million impressions if you advertise on this Tucker Carlson show. That's absolutely the, like. logic of the like gradual number inflation. But I think what's weird about it now is that that sort of on its face absurd, but everyone just goes along with it. Number inflation is bleeding out of just, you know, the sales teams at websites and social platforms. It's now just like something that everyone talks about. And fandoms talk about metrics all the time. They try to manipulate metrics,

even if the metrics are sort of fake to like get their people, you know, seen or in some cases paid more. You've got Elon Musk kind of making the case for the existence of his entire platform and the relevance of his entire platform going on to like double down on this after a bunch of people pointed out that yeah, this, for example, Trump tweet is kind of ridiculous. The other day he was suggesting that three billion people a month see long tweets. Like just the Twitter blue long form content is viewed by three billion people, which I'm sure in some extremely narrow way is true. Like that content somehow produced in a combination of people scrolling,

kind of like loading or, you know, internal API calls calling upon these posts. I'm sure that number of impressions, to borrow the ad world term here, was somehow kind of generated and logged. But that just has no relationship to the reality of how many people are engaging with something or seeing something or like taking something in. Well, and I think there are like two sides of this to me. One is this sort of nonsense advertiser metrics we've always had, right? And every company has their own special metrics that don't make any sense to anyone

and essentially mean nothing. You know, Elon Musk has been doing this loudly with Twitter. Like he talks a lot about like regretted user minutes. Yeah. Which like what on earth does that mean? But that has nothing to do with sort of my life. It's just like a thing they say to seem big. And everybody has numbers that they.

They want to make big or small when it's used to doing small. And that's all fine and good. But I think your point about the word views to me is like what makes this specific thing so interesting because one of the very few comparable things across all of these platforms that we have all the way down to like linear television on your TV in your living room is we call them all views. And the content is different. The way that they're delivered is different.

The way that they're measured is different. But we call them all views. And so we compare this like it's this apples to apples thing. and they just honestly have nothing to do with each other. Like what Netflix thinks is of you is so diametrically different than what YouTube thinks is of you and what TikTok thinks is of you and what Twitter thinks is of you that we're not talking about remotely the same thing,

but because we use the same word, we obsessively pit these things against each other all the time. And it's kind of weird because nowadays, you know, 30 years ago, these metrics were actually difficult to make. measure, right? Like, you had to sit, you had to have a little box on your TV in your house. That was it. Maybe the cookies could sometimes get it. But nowadays, everybody is logging into these services. They're logging into YouTube. They're logging into Twitter. They're logging into Netflix. It is very, very easy to get actual super valuable, super like, get into the

nitty gritty on these metrics. And they're still going for the broadest, most useless metrics they can announce. That's sort of like the central, funny thing about this to me, which is that, Yeah, I guess we're talking on a 30-year time scale now. But if you think about linear TV or print publications, you had some data about how many people were seeing your things. You had like, you know, your circulation number or your subscription numbers, then you estimate your circulation numbers. You have the number of people in a certain market. You have all this. But you don't have this direct access to like how people are interacting with your stuff.

So the people making media had this need to like figure out what was going on. So you end up with things like Nielsen where people sit in their houses and log what they're doing. And then you do some statistical work on that and come up with an estimate for how many people are watching things. And then advertisers use that number. And you end up with like a flawed but transactable standard that people work with. Yeah. At least it's like more or less apples to apples, right? Yeah.

Everyone with Nielsen always agreed like it's not perfect, but it's at least sort of directly applicable from thing to thing. And it's close enough. Yeah. But that world had all kinds of problems. but the rise of like, you know, digital media brought along with it this promise that, of course, everything is going to be tracked down to the second. We're going to know so much about what people are doing. Anyone who's written online for a long time knows that like your publication knows

how far people scroll in every article that you write. And the numbers aren't good. Like you just sort of ignore that. You just pretend that people actually finish your articles, but no one does. Like this amount of information that you can collect directly now is huge. So people making media have incredible amounts of information. There's total audience surveillance. Nothing that you do or consume digitally is not tracked down to this microscopic level.

And yet we somehow collectively know less about what's going on. Everyone treats this information that they have as like a trade secret, which has the weird effect of making it basically useless. If it's like, all right, we're all going to agree on tracking standards, we're going to do this in a transparent way. If there was some totally alternate history where everyone is surveilling their audiences very closely, which is, you know, can and worms too, but then sharing and comparing and auditing that data in a transparent way, then you end up with like a very different kind of world where there

is like, it would just change the media landscape a lot. People would know more about what people are doing and that would create all kinds of different incentives and demands and some would be worse and some would be better. However, for now, you've just got nothing. We've got everyone has so much data, terrapetabytes of audience data that is just like closely guarded and shared in the most misleading way possible in tiny little fragments when Netflix is. ready to be like, we actually tracked, you know, three billion watch minutes for Squid Game, which is the most we've ever tracked. And we started tracking this last year.

And it's just like, what is that for? I mean, it's obviously it's for marketing. And it's a sort of like flex in a particular way to say that, yeah, we are not just doing bullshit impressions. We're tracking time. And we wouldn't do that if it wasn't a lot. But it still doesn't mean anything. So we just sort of like somehow managed to take more and do less with it collectively, which is, you know, Kind of a nice, common story online these days.

Why do you think they treat it like these trade secrets? Because I totally agree. Is it because they think that, you know, the numbers used to be bigger? The media was like a much more, a smaller landscape. And so a show could have 20 million viewers. That was a really big deal. And now the biggest shows have like 10 million. And so they don't want to be like, oh, yeah, Wednesday is the biggest show on the platform right now.

And actually, it's got like 5 million viewers or something. I think that's a really interesting question. and some of it probably just comes down to like instincts. Like, oh my gosh, we have this thing. It's proprietary. It's ours. There is a real tendency I feel across large corporations, but one that I've observed more directly in tech companies that I record on

to just sort of treat everything like a trade secret. Like you might as well. And you end up with these interesting collective problems when you do that that show up further down the road. But also, like you said, with the streamers in particular, they've got kind of a different problem from, let's say, Facebook, which is routinely racking up just absurdly high numbers whenever they attack a metric to something. Like, oh, 100 million people watched a viral video yesterday and the day before and the day before.

That works for them. They can be like, yeah, that's amazing. Look at these big numbers. It turns out there's 20 billion people in the world, and we found a bunch more of them, and they all use Facebook. But Netflix, like you said, is tracking this stuff from a very early stage, very data-focused company that use it to inform all their decisions. And they're also, I'm sure, seeing like, okay, we've licensed a beloved old sitcom that, you know, when in its heyday was getting like 20 million primetime viewers every week, according to Nielsen. And we just put it on here and like, it's doing okay, but it's not doing that. Or our new sitcom that we just released that everyone's talking about that's getting a lot of great coverage, actually not that many people watch it.

And that's kind of flipped over time. Like, there are genuine huge streaming hits. It's not just like a media illusion that, I mean, everyone watches. streaming now. That is how people watch TV. But the precedent was said a long time ago. It's just like, well, we're not going to right out of the gates, like, rush into some sort of mutual surveillance with tons of disclosures. And we're not going to do that if we don't have to. We don't have that need that people used to have when they worked with Nielsen and depended on Nielsen for selling advertisements and getting their ratings to know how many people are watching our

stuff. We know. We would love to know how many people watch other people's stuff. But, you know, They have their ways of guessing. They seem fine with not knowing how many people are watching, like, this HBO Max reality show or whatever. Like, Netflix is fine with that. Well, this is where we come back to my kind of, like, number nihilism. And, like, Kranz, you and I have talked about this a bunch, right? The case against forcing all of these streaming companies in particular to share a lot of

really understandable apples to apples numbers is that one thing it will do is make very obvious how many shows don't work, right? And it's great for the people who are making shows that are bigger than you think, and it's actually bad for the people making shows that are worse than you think and not doing well. And it can, like, that stuff can have real effects on people's careers. And it is anyway, because, like, Netflix knows the shows that don't work and it cancels those shows. So that's obviously bad for people's careers. But, like, if it starts to be out there, like, people used to be petrified of ratings every day, because if the ratings decided your career and part of me

wonders whether what we need is better, more understandable metrics, or if part of what we need like many, many, many, many fewer metrics and maybe this place we've come to where really nothing means anything, if we all can acknowledge that nothing means anything, maybe we're actually in a better place. Well, I think the metrics don't mean anything, even for the companies themselves, because I can think of like at least two different shows in the last year who did successfully, were said to be successes on their networks, showed like, you know, one of them was in the top 10 for Netflix for the week it premiered.

And then they immediately got canceled. They got canceled pretty quickly. One of them was a league of their own, which was like a very successful show for Amazon, but a very expensive show for Amazon and not nearly the hit they had hoped it to be. And it had this long, slow cancellation death. That other one was Warrior Nunn, which was like another show did seemingly did very well and then was canceled the same week. It like premiered. And so it left all those fans who, you know, that was something John you mentioned. Fans are like the most meticulous.

They're better than Nielsen when it comes to figuring out rating. Like, they are so good at figuring this stuff out. And they were just saying, well, numbers don't mean anything because you published all your numbers which say this. And we have all the stuff we tracked and says this. And you still went and did it. So what is numbers? And it came down to it was expensive and they didn't want to make it, right? Like, they didn't want to do a third season because third season would increase the cost of the entire staff and the contract and everything that Haliflex does it.

And that was the real reason. And it was like, okay, numbers are to blame. Well, this is something where I'm really kind of torn because I work in an industry where people watch your numbers at work and see how many people read what you do and it matters and, you know, it determines all kinds of things about your job and also your sense of like what you're doing and why. But there isn't a world where streaming companies aren't like collecting and using this data or rather data in general to like figure out what to do. And at streaming companies more than at, you know, social media companies which have to depend on really direct. relationships between like viewership metrics and advertising and all this stuff but that's all very like very very direct as streaming companies viewership metrics and and their sort of internal ratings they serve as like a weird proxy a sensible proxy for success in a way if you're making TV

but what they actually survive on mostly for now and I guess this is this is changing is subscription numbers that's the actual metric that matters and so Netflix is like all right well we can't tell that precisely this is their version of the old measurement problem what is driving subscriptions. Like, we have good ideas. We notice that people stick around after they watch this or they sign up and then watch that. Like, they have some stuff.

But what the ratings do for them instead is just serve as like a way to value things that aren't actually assigned a value in a very, very direct way. And if they're going to do that, I tend to think that like more visibility is better and more transparency about what the numbers mean because the people making the shows, the people watching their shows, if they don't have that information and Netflix does, they're at some sort of disadvantage. If you're a viewer, that's sort of fuzzy. You're talking about fandom stuff again. If you're creating shows, you have less leverage to, like, ask for more money, or you have less warning about when you're going to get canceled, or you

are missing part of the story if your show does get canceled. And you suspect that it was viewed by a lot of people, but maybe there's something else going on. Like, it's just being withheld. And in the context of the strikes in Hollywood, generally writers and other people who work in entertainment, they generally just want more information because the information exists. And it might be kind of bullshit and it might be collected in a way that isn't super transparent. But if it's going to be used to make decisions, it's better that people who are trying to make this stuff know it. It's not ideal that they have to obsess about it. Like that's, that's a problem too. If there's a world where Netflix becomes hypermetrics focused in a public way and becomes in that sense more like YouTube,

you have a different set of problems. But, you know, you've also got a system that is somewhat more accountable where in some small way, people who are doing creative work have a little bit more of a sense of where they stand. And that's not worth nothing, especially when you're arguing about pay that is determined by basically metrics, which again, to sort of like back way, way up, are all fundamentally made up. You have to like come up with a standard for measuring things. You have to apply it with some level of rigor. Like there is, every time you see a number that purports to measure something down to like the most fundamental measurements, you should wonder, like, how it works.

Apply that a thousand times over when you're looking at something attached to like a piece of social media content. But still, if they're used, they matter. And if they matter, then I think people, creative people should probably have more access to them. All right, John, before we let you go, can we talk about your phone situation for a minute here? Because the, the Vergecast audience needs to know. You wrote about the iPhone 15, which I thought was very smart.

We've discovered in the course of doing this that you have an iPhone 12, mini that is literally in the middle of exploding as we are recording this. Tell us about your phone life and why you're getting a new phone this year. So listen, I've been a gadget blogger for coming up on 15 years here. I don't really have an excuse. But I love the mini. It's small. It was never very good.

The battery never lasted very long. I have little beautiful children. I want to take pictures. It's not great. But I don't know. I stuck it out. I didn't want to give up this little thing. It did overheat while we were recording.

It's on an ice pack right now, we should say. Yeah, it's on a little pink ice pack from my daughter's lunchbox to kind of make it to the end of the episode here. It couldn't handle wireless charging and talking on a video at the same time. So in that sense, I am so excited about the iPhone 15. For work purposes, for the purposes of content creation, I've got numerous critiques and thoughts and complications about this. However, I can't wait to pre-order.

I don't care how big it is, as long as it doesn't become like dangerously hot while I attempt to do my job. I'll be happy. So, you know. Fair enough. All right. John, thank you so much for being on.

This is really fun. Alex, thank you. We all, we're going to need to do this again. The numbers are not going to stop being weird and you're going to keep doing stuff we like. So keep coming back on, John. Anytime. Really a pleasure to join you.

All right. got to take one more break and then we're going to get to the Vergecast hotline. We'll be right back. Support for the show comes from LinkedIn. If you're a small business owner, you know that every hire counts, but time and resources are limited. Finding, connecting with, and screening the right candidates takes up valuable time you could be giving to your customers. That's where LinkedIn Hiring Pro comes in. It's built to be your hiring partner, helping you find the right candidates faster. That way you can hire with confidence without turning it into another full-time job. Hiring Pro streamlines the entire process from drafting your job to shortlisting candidates and conducting AI-powered

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It's a great freaking database. Start building at MongoDB.com slash build. All right, before we get out of here, let's answer a question from the hotline. As a reminder, the hotline number is 866 Verge11. We want all of your best

and weirdest tech questions. And if you don't want to call, you can email Vergecast at theverge.com. That works great too, but it's always fun hearing the hotline. I'm not going to lie. Anyway, this week's question

sent me on kind of a tail spin. So let's just hear it. Hey guys, this is Mark from Tampa. I got a question for you, and you guys seem like the right ones to answer it. It's a bit of a streaming and a hardware question. So a few months back, during the reveal of the Apple Vision Pro, Bob Iger came onto the stage and mentioned that he was developing a Disney Plus app for that $3,500 monstrosity of a system. However, I did notice that, you know, I have a couple of kids. We have Nintendo Switches. There's over 125 million of those already sold and in hands everywhere.

Do you guys have any possible reason why Disney wouldn't have a Disney Plus app already on a platform that big? They've already have a Hulu app for it. So it would just seem like a slam dunk why they wouldn't have it in hands of all the kids around. Seems silly to carry around an iPad and a switch whenever we travel. So just curious if you guys have any thoughts on it. All right. Have a great day. Take care.

Okay, I should say up front here that I am totally fascinated by this question, and I'm still trying to report it out. So hopefully I will have a firm, Pat, 100% answer really soon. But in the meantime, I've been talking to people and, like, putting yarn on a board with people's photos to try and make sense of this situation. And here's where I've gotten so far. I think there are three separate things going on here, and I'll rank them kind of in order of importance. The first thing is that with the switch, Nintendo wanted to make a game console, first and foremost. We've had companies in the past, Microsoft with the Xbox One, probably most famously, try to do the game console and entertainment system thing really well simultaneously,

and it just really doesn't work. And one of the things that Nintendo has done really well over time is just make great games. It has had streaming services in the past, but the reason people buy Nintendo products is for great games, Nintendo knows that better than just about anybody else. Just to name one example. Here is Reggie Filsame, who was formerly the Nintendo of America president and COO, talking in 2018 about how he was thinking about streaming services.

The question was essentially, when are people going to be able to watch Netflix on the Switch? And here's what he said. For those types of questions, we have to refer you to the folks at Netflix. What we said when we launched Nintendo Switch was that we wanted to have a gaming first platform, and that's what we've created. And that's what enabled us in the first 12 months in the United States to be the best-selling home console in the history of video games. Right now, we enable Hulu on the platform. We've said that other services will come and do time.

For us, we want to make sure that we continue driving the install base for Nintendo Switch, continue to have great games for the platform. In terms of, you know, what's next on the streaming side, you're going to have to talk to those individual providers in terms of where they stand and what they're working on. That's a little bit of a cop-out, but I think it's also true that Nintendo knows that entertainment doesn't really move the needle. People might watch stuff on their consoles, but nobody's buying a console as a way to watch stuff, if that makes sense. And so I think if you're Nintendo and you're a company that does basically one thing very well

and you want to keep doing it, that kind of focus really makes sense. The second thing is that I think Disney would really like to have Disney Plus on the switch. When it launched Disney Plus in 2019, it did a... a big show in front of investors about what was going on. And it actually had a slide of all the places that it wanted Disney Plus to be. And it included a picture of the Switch, like right there on the slide, big red Nintendo Switch. And as he was showing this slide, here is what Michael Paul, who's Disney's president of streaming services, said at time. Right now, we are securing distribution for Disney Plus across mobile devices and connected TV devices, including game consoles,

streaming media players, and smart TVs. With these device partnerships, not only do we optimize our product for consumer experience, we ensure that our service will be prominently featured in merchandised on our partner platforms. Right. Okay, so Disney wanted this. I don't think that was smoke. That is Disney saying, we want to be on all the platforms. I think if it were easy and straightforward, Disney Plus would probably be on the switch. But that thing that Michael Paul said, about being prominently featured and merchandised, that's kind of the third thing. We think of these streaming platforms and the systems that they run on as just sort of app stores,

right? Build a thing, put it on the platform, everybody wins. But that's not actually how it works. This business is really messy. And when ads get involved and when subscriptions get involved, everybody wants a cut, everybody wants access to user data. Everybody wants to be the first one featured in the store and get prominent placement. and there are questions about who's in the search and what happens when you search for streaming, every part of this is like relentlessly negotiated and there's a ton of money in it.

It's how TV makers make a lot of their money. It's how streaming platforms make a lot of their money. This is a big and complicated business. And the thing about Nintendo is Nintendo just doesn't need to care about any of this. If you remember, there was that email that Phil Spencer, the head of Xbox, sent about wanting to buy Nintendo. He basically said that the bad news for Microsoft at the first, time was that Nintendo, and I'm quoting here, is sitting on a big pile of cash and they have

a board of directors that until recently has not pushed for further increases in market growth or stock appreciation. If you were, in theory, super interested in market growth or stock appreciation, one thing you might do is hire a bunch of people and get really into the weeds of negotiating these deals with streaming services such that maybe you become a streaming platform. But Nintendo's good. I don't think Nintendo needs the hassle. It's very high. happy making these smash hit games, making a console every once in a while. It seems to be a good business. It seems to be working for Nintendo. And my guess is it just doesn't need the nonsense that comes with being a really successful streaming platform. Put all of that together. And I think

that might be it. I think Nintendo just doesn't want this that badly. And so here we are. I think, frankly, it might be a miracle that we got Hulu and YouTube and Crunchyroll rather than a problem that we don't have the rest of the services. But that said, if there is a smoking gun here, I'm going to find it. And if you know the answer, and you want to tell me why Netflix and Disney Plus and Max and all these other services

are not on the Nintendo Switch, call the hotline 866, Verge11, or email us, vergecast to the verge.com. Tell me all your answers. All right, for now, that is it for the Vergecast. Thanks to everyone who came on the show, and thank you, as always, for listening. There's lots more on all of this stuff,

especially the shutdown of DVD.com. Yanko Rutgers wrote a great piece for us about how that service worked, which is very cool. We'll put a bunch of links in the show notes, but as always, read the verge.com. It's a cool website. The last thing, this is probably the last call for this, but if you have questions about the Verge or the Vergecast

that you want us to answer on our meta Vergecast episode, get them in now. We're recording that episode really soon. We have a ton of fun stuff. It's going to be a really fun episode. This show is produced by Andrew Marino and Liam James. Brooke Minters is our editorial director of audio. The Vergecast is Verge production and part of the Vox Media Podcast Network. Nilai, Alex, and I will be back on Friday to talk about MetaConnect, the code conference, and whatever else happens this week, because everything just keeps happening.

We'll see you then. Rock and roll.