Speaker 1: This is Bloomberg Business Week from Bloomberg Radio. Hi, I'm
Speaker 1: Jason Kelley and I'm Carol Masser. Welcome to the weekend
Speaker 1: edition of Bloomberg Business Week. So Jason here, it is
Speaker 1: Week eleven, a short and trading week. Nothing quiet though
Speaker 1: about the news flow, and that included things like heightened
Speaker 1: tensions between the US and China. We're going to talk
Speaker 1: about that a little bit later on. We've got more
Speaker 1: companies getting back to work or trying to figure out
Speaker 1: exactly what the plans are doing. And then we had
Speaker 1: some headlines maybe green shoots, perhaps U S State's jobless
Speaker 1: roles they shrank for the first time during the virus pandemic,
Speaker 1: but nonetheless we still have more than forty million Americans
Speaker 1: have filed for those benefits in the past two and
Speaker 1: a half months. So this contradictory as people try to
Speaker 1: continually look forward, well, and it was a week where
Speaker 1: industry by industry, we started to get a picture of
Speaker 1: where we go from here. We try over the course
Speaker 1: of the week to talk to lots of different people
Speaker 1: and lots of different businesses, be at the financial industry,
Speaker 1: and we spoke with Margaret Keene over at synchrony about
Speaker 1: what she's seeing there, of course, a massive credit card issuer.
Speaker 1: We talked to Nancy Spielberg. She's a director, she understands
Speaker 1: where film is going from here and salt Con Uh
Speaker 1: frequent guest on this show, someone we talked to a
Speaker 1: lot and listen, no industry, no business, no experience has
Speaker 1: been disrupted in many ways more than learning. So all
Speaker 1: that straight ahead. Yeah, absolutely, and let's not forget to
Speaker 1: WHAWE was in the news once again, so we caught
Speaker 1: up with Huawei USA's chief security officer, Andy Purdy, and
Speaker 1: then we also heard about the private aviation industry. Interesting.
Speaker 1: Of course it's shut down like everything else, but they're
Speaker 1: starting to see some new trends and new demands. So
Speaker 1: Andrew Collins UH, the CEO and president of Sentient Jet,
Speaker 1: stop by as well. First up, though, we had to
Speaker 1: talk about where we are in the virus. That's right.
Speaker 1: We caught up with Dr Joe and Robert. She's the
Speaker 1: chief quality officer at Providence St. Joseph Health and this
Speaker 1: has been a go two source for us. Fair to say,
Speaker 1: we've talked to a lot of their senior doctors and
Speaker 1: senior officials because they have been on the front lines
Speaker 1: since the very beginning. The first recorded case of the
Speaker 1: virus in the United States. It was at their hospital.
Speaker 1: She helped frame where we are now and where we
Speaker 1: may be going as far as where I think we
Speaker 1: are with the spread of the pandemic UM, and I
Speaker 1: think by and large most of our country has done
Speaker 1: really well in physical distancing and masking and other other areas.
Speaker 1: I think we all know the challenges bringing our country
Speaker 1: together around this UM. I think we in healthcare are
Speaker 1: looking too early to mid June to see what the
Speaker 1: effects are of the opening up that we really saw
Speaker 1: this Memorial Day, because everything that we do today will
Speaker 1: show up two or three weeks later in our hospitals
Speaker 1: when people get sick and start coming in, and we're
Speaker 1: watching that closely, day by day. And so Dr roberts
Speaker 1: is care All said at the top, you know, you
Speaker 1: guys were the first to see cases here in the
Speaker 1: United States. What have you learned about treatment? What have
Speaker 1: you learned about this disease that may be useful to
Speaker 1: those of us who aren't, who weren't on the front
Speaker 1: end as much. Yeah, I think what we're seeing in
Speaker 1: the mass media is born out with us locally as well.
Speaker 1: We just this morning I had a discussion of the
Speaker 1: use of rim disavere, as you know, that's being released
Speaker 1: more and more through Gilead and UM. We believe we
Speaker 1: have enough doses on hand to treat all of our
Speaker 1: patients that we currently have. It's not a magic bullet.
Speaker 1: It doesn't preclude any of the things that we all
Speaker 1: need to do around masking and social distancing, but it
Speaker 1: does seem to at least lower the length of stay
Speaker 1: in our hospitals, and we are expecting more reports out soon.
Speaker 1: Hopefully that rim disavere will actually improve the mortality rates
Speaker 1: and decrease the number of deaths. But it's just one
Speaker 1: piece of a bigger story that continues to evolve week
Speaker 1: by week. And how soon will we really know the
Speaker 1: efficacy of ramdesevie. Is it weeks? Is it months? Like?
Speaker 1: What's the timeline there? I think, like I said, I
Speaker 1: think every week we see more science being released, more
Speaker 1: studies being completed. I think within the next two to
Speaker 1: three weeks we'll see more of the story around reseevere
Speaker 1: as well as other agents that are in the pipeline.
Speaker 1: Is a second wave a given? Yes, it is. I
Speaker 1: think there's we believe, there's no doubt that a second
Speaker 1: wave will come. We don't know when it will come,
Speaker 1: we don't know how big it will be, UM, but
Speaker 1: we we are certainly putting together plans inside of Providence
Speaker 1: to try to detect the second wave early and to
Speaker 1: here for it. As you know, in the nineteen eighteen
Speaker 1: flu pandemic, it was the second wave that was the
Speaker 1: big killer. Five times as many people died in the
Speaker 1: second wave as in the first wave. And so we're
Speaker 1: not out of the woods yet. We're in a breathing
Speaker 1: space where we can all get ready for the next wave.
Speaker 1: So what's the science behind that that a second wave
Speaker 1: is more deadly and would that necessarily be the case
Speaker 1: with this virus? Would We don't know. We are we're
Speaker 1: in a position of not knowing what the second wave
Speaker 1: will look like. UM. I wouldn't say why. I don't
Speaker 1: think any of us expect the second wave will be worse,
Speaker 1: but we have to prepare as if it could be worse.
Speaker 1: And that's Dr Joean Roberts to Quality officer over at
Speaker 1: Providence St. Joseph's Health and Carol, I really felt this way,
Speaker 1: and you and I were communicating via in some message
Speaker 1: right after we got done with this interview. This was
Speaker 1: the interview I needed this week to really understand where
Speaker 1: we are and where we're going. A reality check to
Speaker 1: some extent, some optimism, but certainly some realism too. Yeah. Absolutely,
Speaker 1: she took us to the steps. You need testing, you
Speaker 1: need therapies, and then ultimately need a vaccine. And one
Speaker 1: of the things that stayed with me, Jason is when
Speaker 1: we asked her, is a second wave a given? And
Speaker 1: she simply said, yes, I don't know when and don't
Speaker 1: know how big. And that explains some of the nervousness
Speaker 1: that continues to stay, certainly in our society, in the
Speaker 1: markets and in the business community at large. But I
Speaker 1: do always feel like I get everything that's going on
Speaker 1: when it comes to the virus. When she sits down
Speaker 1: and talks to us, we get it explained absolutely, and
Speaker 1: the optimism clearly is around our preparedness when it comes
Speaker 1: back around again. Coming up our conversation with Margaret Keene,
Speaker 1: she's the CEO of Synchrony Financial, really has some great
Speaker 1: insight on what consumers are up to. This is Bloomberg.
Speaker 1: This is Bloomberg Business Week from Bloomberg Radio. Hello, I'm
Speaker 1: Carol Masser and I'm Jason Kelly. Today we're bringing you
Speaker 1: some of the most important, we hope informative conversations we
Speaker 1: had on our daily Bloomberg Business Week radio show. And
Speaker 1: now let's get to our conversation with Margaret kench Is,
Speaker 1: the CEO of Synchrony Financial. I'd say going into the pandemic,
Speaker 1: the consumer was very strong. We were we were doing
Speaker 1: really well, sales were strong, payments were coming in. The
Speaker 1: consumer is really acting very responsibly, and we felt like
Speaker 1: we were going to have, you know, a great year.
Speaker 1: Um then the pandemic came along and obviously, you know,
Speaker 1: the initial onset of that really shut down most of
Speaker 1: the retail landscape. And you know, we saw our sales
Speaker 1: and we said this in our earnings down averaging about
Speaker 1: thirty two to thirty four percent UM. What we've seen
Speaker 1: since then, though, is definitely a bit of a comeback.
Speaker 1: Our sales are down there ten uh so certainly the
Speaker 1: consumer is um back out and shopping, and uh, you know,
Speaker 1: we're seeing it across the US. So it isn't even
Speaker 1: just in the states that I would say are completely open.
Speaker 1: It's it's as off the board. Well that's you know,
Speaker 1: we're going to pay closest attention to that. Yeah, I mean,
Speaker 1: because you know, it's interesting. We've been having so many conversations,
Speaker 1: certainly here at Bloomberg, you know that it feels like
Speaker 1: to some extent we're flying blind when it comes to
Speaker 1: the economy. We know the past data points looking backwards
Speaker 1: are not going to be good. We get that, right,
Speaker 1: but we are wondering about what kind of a bounce
Speaker 1: back do we get on the other side. So you're
Speaker 1: saying consumers are coming back, I mean, what kind of
Speaker 1: indications are you know, what are they spending? And and
Speaker 1: you said it's up about ten percent or what can
Speaker 1: you tell us in terms of well, it's down from
Speaker 1: where it was at the beginning, so we dropped ourselves.
Speaker 1: We're at about they dropped all thirty two is then
Speaker 1: they come back. Now they're down ten percent from what
Speaker 1: they were free pandemic, So that's a pretty big swing. Um.
Speaker 1: What I would say is, um, you know, it's the
Speaker 1: things we're reading about. You know, for instance, power sports,
Speaker 1: we're not big in power works, but how how sport
Speaker 1: sales are up a hundred percent, so people are buying
Speaker 1: things that they can play with at home us. And
Speaker 1: we're seeing things related to the home be very strong,
Speaker 1: whether that um home furnishings or or things that people
Speaker 1: are doing to fix up their home. So we're certainly
Speaker 1: seeing strengths there. Um. You know, we were talking about bicycles.
Speaker 1: Adult bicycles. You can't really get sold out. So it's
Speaker 1: really been I think what's happening with the conservative a
Speaker 1: couple of things. We we believe One is people have
Speaker 1: given up vacations. They're staying at home and finding stay
Speaker 1: at home so they're fixing up their homes and doing
Speaker 1: activities around the house with their children and their families.
Speaker 1: I think, uh, you know, we think that's a positive
Speaker 1: and and I think that's where consumers are spending. Obviously,
Speaker 1: you know, we have very strong online partners. We're definitely
Speaker 1: seeing online being a big part of that process as well. Um.
Speaker 1: But I you know, honestly, I think we're we're we're
Speaker 1: probably um, we're probably a bit more positive than we
Speaker 1: thought we were going to be at this point when
Speaker 1: we first started out here. Yeah, talk take a lot
Speaker 1: of stimulus out there, and that's something we've got to
Speaker 1: pay attention to. There's still a lot of stimulus, and
Speaker 1: I think what we've been saying is we've got to
Speaker 1: make it through this summer. See when that stimulus runs out,
Speaker 1: and then where do we where do we stand? And
Speaker 1: we probably want to have a good read until sir quarter.
Speaker 1: And So Margaret, when you think about the retail environment,
Speaker 1: obviously so many things have been shut down. You've had
Speaker 1: well known brands UH go bankrupt and you know, some
Speaker 1: may restructure, some may never come back. What's the net
Speaker 1: effect of that for basically sort of the world at large,
Speaker 1: but also for your business this shift to online where
Speaker 1: I know you're very active as well, But break that
Speaker 1: down for us if you can sure you know, I
Speaker 1: would say, look, retail has been going through a transformation
Speaker 1: requite a while. I think the pandemic and the fact
Speaker 1: that people have to shut their doors just accelerated some
Speaker 1: of what was going to happen over time. So we're
Speaker 1: seeing that, you know, in some of our partners as
Speaker 1: well as many other retailers that are not our partners.
Speaker 1: And I think what's happening is you're seeing retailers who
Speaker 1: are strong becoming even stronger. And I think that will continue. Um,
Speaker 1: you know, I do believe that there's been a lot
Speaker 1: of view that retail is dead. I do not believe
Speaker 1: retailer is dead. I think people like to shop. I
Speaker 1: think we will over retail, and I think the strong
Speaker 1: retailers will certainly survive this and probably be stronger in
Speaker 1: the end. I do think retail has to have a
Speaker 1: digital strategy as well. They need to be able to
Speaker 1: be where that customer is shopping. And I think from
Speaker 1: a customer behavior perspective, we certainly have seen a continued
Speaker 1: shift and an acceleration of people shopping digitally, and I
Speaker 1: think that will continue. So I think there are certain
Speaker 1: things that people may have never thought of buying online before,
Speaker 1: but of buying online and have not been comfortable with
Speaker 1: that through this process, and that's going to shift consumer behavior.
Speaker 1: I think going forward, what do you think people will
Speaker 1: still shop? People will still shop. Yeah, I agree. I
Speaker 1: think it's a social thing to some extent, and people
Speaker 1: enjoy actually going out and feeling merchandise. And I think,
Speaker 1: you know, maybe in New York it's going to take
Speaker 1: a little while to come back, but you know, until
Speaker 1: people feel safe safer. What are you seeing in terms
Speaker 1: of delinquencies and people's ability to actually pay their credit cards.
Speaker 1: So this is this is probably one of the more
Speaker 1: interesting things that we're trying to figure out. You know,
Speaker 1: constomers are paying that credit card. So about of the
Speaker 1: customers who initially put themselves into a deferred payment status
Speaker 1: have actually come out of that and are paying their accounts.
Speaker 1: So we actually are seeing good payments right now, which
Speaker 1: is another thing that I think has us a little
Speaker 1: bit a pause to understand. Why is that now? Is
Speaker 1: it the stimulus? Is it the fact that people aren't
Speaker 1: spending money elsewhere on discretionaries, so they're paying their credit
Speaker 1: cards and their their obligations. Um, you know, we have
Speaker 1: a lot of people who are receiving benefits, so is
Speaker 1: that helping. Probably all these things are helping, you know.
Speaker 1: The other is a big one is you know, people
Speaker 1: aren't driving, so gas privates are down even if they
Speaker 1: are driving, so there's extra dollars there. So right now,
Speaker 1: our our our performance in our books is good. We're
Speaker 1: very cautious on this though, because we still believe that,
Speaker 1: you know, we got to see how people come out
Speaker 1: of this after the stimulus runs out, and more importantly,
Speaker 1: what is the job market look like? How many people
Speaker 1: are still at work. I think we're still very clauseous
Speaker 1: on this particular area. And that's Margaret Keen, the CEO
Speaker 1: of Synchrony Financial. And as we said going into the conversation, Carol,
Speaker 1: you know, this is a company that really has an
Speaker 1: intimate window into how consumers are feeling, but also how
Speaker 1: retailers are faring. Amid all of this, we've seen a
Speaker 1: raft of bankruptcies, we've seen demand really EBB, and you
Speaker 1: do wonder what the window looks like going forward, right,
Speaker 1: and if stores more stores shut down and people don't
Speaker 1: have to use their cards and more things are done online,
Speaker 1: you do wonder what will be ultimately long term the
Speaker 1: impact on a company like Synchrony Financial. You're listening to
Speaker 1: Bloomberg this week, coming up a conversation on managing the
Speaker 1: wealth of athletes with Joe McClean, managing partner at Intersect Capital.
Speaker 1: This is Bloomberg. This is Bloomberg Business Week from Bloomberg Radio.
Speaker 1: So Jason will bring you some of the most important
Speaker 1: and informative conversations we had throughout the week on our
Speaker 1: daily radio show. And of course all of this happening
Speaker 1: in real time as news was happening around us. And
Speaker 1: that included conversations about the sports world, which we know
Speaker 1: it's very tricky getting that back to normal. Absolutely. Joe McClean,
Speaker 1: he's the managing partner over at Intersect Capital, and you
Speaker 1: hear Intersect Capital and you think, all right, what does
Speaker 1: this have to do with sports? A lot actually, because
Speaker 1: he is advising athletes on their money from the time
Speaker 1: that they signed their first contract. He has an amazing
Speaker 1: sort of roster of folks, but also a very methodical
Speaker 1: plan on how they should be thinking about their money.
Speaker 1: And in a world without sports, that's even trickier. Basketball is.
Speaker 1: I'm not as optimistic, although if you talk to the players,
Speaker 1: they're very optimistic. They have the best relationship with their commissioner,
Speaker 1: frankly um And and the commission has been very candid
Speaker 1: um but I know he's also been very cautious. You know,
Speaker 1: we have some players that are still sitting Americans that
Speaker 1: are sitting in China waiting for that league to start.
Speaker 1: And they've been there now for months. They've quarantined for
Speaker 1: two weeks, They've now been there for over two months.
Speaker 1: Every players in one city and they're still not ready
Speaker 1: to go. So I'm not saying China is a leading
Speaker 1: indicator of what the NBA can do in the States,
Speaker 1: but there's still no movement there, and it's tough to
Speaker 1: say that they'll be moving in the States until I
Speaker 1: see some positive momentum there. What about other sports? All right,
Speaker 1: so we talked about golf, you think first, you're not
Speaker 1: as optimistic about basketball. What else? So baseball, you know,
Speaker 1: they're they're installed with with the conversations they're trying to have,
Speaker 1: you know, it's they've already come out ob see this
Speaker 1: going to be a reduced schedule, um, which means reduced salaries. Um.
Speaker 1: They're still also fighting for some of the details like um,
Speaker 1: you know, in baseball, you really want to get your
Speaker 1: service time under your belt each year, and if they
Speaker 1: don't play a certain amount of games, they may not
Speaker 1: qualified for that. So the players want to make sure
Speaker 1: that all their rights are protected, um. Not just not
Speaker 1: just that it's safe to play, but that's also they're
Speaker 1: not giving in on anything they wouldn't give in a
Speaker 1: regular season. So I think baseball has has a good
Speaker 1: opportunity to come back, but it's not surely nothing in
Speaker 1: the summer, and and football, I think it's the same.
Speaker 1: You know, they've until each state starts opening up and
Speaker 1: giving um, you know, the players the opportunity to even train,
Speaker 1: let alone play. Um, I still don't see any in
Speaker 1: the summer there they they're they've already been told they
Speaker 1: can't take physicals until mid mid June, late June. So, um,
Speaker 1: it's gonna be a long way, long long wait for
Speaker 1: all of us. Well, so let's talk about baseball if
Speaker 1: we can for a second, because the economics there, I
Speaker 1: think are really interesting and this really plays, I think
Speaker 1: into a lot of what you talk about with with
Speaker 1: your clients. Um. And you know, I had a chance
Speaker 1: to catch up earlier in the week with Rachel Luba,
Speaker 1: who is the agent to Trevor Bauer, as you know,
Speaker 1: and you know, one of the things she said was
Speaker 1: that they are so far apart in in part because
Speaker 1: there's it feels like a fundamental disagreement on the economics
Speaker 1: and sort of who should kind of bear the burden
Speaker 1: of this? And I do wonder for someone who is
Speaker 1: advising UH baseball players and others about their their wealth,
Speaker 1: what you make of this argument between the owners and
Speaker 1: the players. Well, in my estimation, baseball has their players
Speaker 1: Association has always had one of the strongest, strongest teams
Speaker 1: in place for the players, um and and that has
Speaker 1: led to some incredible economics on behalf of the players. However,
Speaker 1: you know the problem now is there's some some athletes
Speaker 1: making million dollars a year and they're already seeing a
Speaker 1: ten million dollar pay cut. Nobody's feeling sorry for them,
Speaker 1: but um, there's gonna be a point where they've got
Speaker 1: to have some compromises where in the past they haven't UM.
Speaker 1: And then every once in a while the owners want
Speaker 1: to take out, you know, for a spin, the whole
Speaker 1: idea of of salary caps um, which obviously in baseball
Speaker 1: don't exist, they do exist in and other sports UM
Speaker 1: that the players have always fought against. So there's going
Speaker 1: to be a compromise, I think because they know how
Speaker 1: important it is to get the game out. Because in fairness,
Speaker 1: the television has been strong, um, but but the popularity
Speaker 1: hasn't been there. So you don't want them to go
Speaker 1: away for entire season, um, I don't think, because you'll
Speaker 1: lose a lot of momentum. And that's Joe mcclaim, managing
Speaker 1: partner at Interset Capital Love catching up with him because
Speaker 1: he does represent athletes across the spectrum. So many professional
Speaker 1: athletes on the sidelines, as it were, right now, really
Speaker 1: on the sidelines, not the ones they're used to, trying
Speaker 1: to get back to work, trying to figure out not
Speaker 1: just their health and safety, but their financial worth right now, Carol,
Speaker 1: I gotta say, Jason, one of the things that stuck
Speaker 1: with me was what he said about his players, that
Speaker 1: they were realizing all the cause and effect that they
Speaker 1: have on so many others by them not playing, you know,
Speaker 1: seeing that whole sports infrastructure that's impacted. And he said
Speaker 1: that some of them were giving up their income to
Speaker 1: help out some of those other folks that were also
Speaker 1: put out of work as a result of the virus.
Speaker 1: So I really that really just kind of stayed with me.
Speaker 1: All Right, you're listening to Bloomberg Business Week. Coming up,
Speaker 1: we talk online learning with sal Khan of Khan Academy.
Speaker 1: He has seen a surge as more than a billion
Speaker 1: children worldwide have been impacted by school closures because of
Speaker 1: COVID nineteen one. Interesting to hear from him what's temporary
Speaker 1: and what may be permanent in a world that we
Speaker 1: know is utterly changed. This is Bloomberg, This is Bloomberg
Speaker 1: Business Week from Bloomberg Radio. Well, today we're being you
Speaker 1: some of the most important and informative conversations Carol and
Speaker 1: I had this week on our daily Bloomberg Business Week
Speaker 1: radio show. And Jason, of course, we last caught up
Speaker 1: with him, meaning salth Cohn, when we were at the
Speaker 1: Harvard Business School. We were doing a live remote TV
Speaker 1: and radio. He has Harvard be School class of two
Speaker 1: thousand three. He's also, of course the founder of Khan Academy.
Speaker 1: It's a nonprofit that set out to provide a great
Speaker 1: education to all students around the world, and we know
Speaker 1: so many students have been impacted, understandably so because of
Speaker 1: the virus. So to catch up with him, find out
Speaker 1: what they've been doing to help those kids who are
Speaker 1: now at home learning from home, and also to find
Speaker 1: out how much of this stays with us longer term.
Speaker 1: We started seeing our traffic pick up in Asia even
Speaker 1: in January and February because of closures there, But then
Speaker 1: in March when you had the closures in the US
Speaker 1: and frankly the rest of the world. We've seen our
Speaker 1: traffic depending on the week, the two hundred fifty percent
Speaker 1: three percent of normal Uh, you know, we we were
Speaker 1: serving twenty millions students per month pre COVID. We're seeing
Speaker 1: the absolutely number of students go up about sixty year,
Speaker 1: seventy percent, and they're spending sixty s a more time
Speaker 1: per student. So on a daily basis, we had about
Speaker 1: thirty million minutes of learning per day and now we're
Speaker 1: seeing closer to eighty or nine million minutes of learning
Speaker 1: per day. Wow. Wow, that is remarkable. And what have
Speaker 1: you learned from looking at that? Are there's certain things
Speaker 1: that that people are especially focused on. I mean, I
Speaker 1: know most students, I mean they're having to do all
Speaker 1: their learning online. But but I wonder how as you go,
Speaker 1: as you go down into the data, what is it
Speaker 1: showing you. Yeah, you know, it's it's essentially everyone doubling
Speaker 1: down on what they were already doing on kind academy before,
Speaker 1: even before the crisis, about half of our usage was
Speaker 1: what we call teacher directed usage. This is teachers using
Speaker 1: it in a more formal way in their classroom, and
Speaker 1: it seems like that continues to be the case. We
Speaker 1: are most known for our depth and math where stas videos,
Speaker 1: but exercise was starting in even pre k all the
Speaker 1: way through college and so there's still a lot of
Speaker 1: heavy emphasis there, but we're seeing a lot of usage
Speaker 1: of our science content, English and language arts are early
Speaker 1: learning app with kind Academy kids, and some of our
Speaker 1: standardized test prep. We we have a partnership with a
Speaker 1: college board around the set as well. So we're what
Speaker 1: do you think is going to happen with that? Because
Speaker 1: you are increasingly seeing because of the virus, schools back
Speaker 1: off of students having to have those tests. But I
Speaker 1: do feel like there's been a trend away from that.
Speaker 1: Do you think that will ultimately pick up momentum oh
Speaker 1: around the whole testing optional or even not using the Yeah, yeah,
Speaker 1: it's it's it's an interesting phenomenon. And I've been talking
Speaker 1: to folks in the state here in California. I see
Speaker 1: both sides of the issue. People don't want people to
Speaker 1: index too heavily on one test. It causes anxiety. Not
Speaker 1: every student performs equally on you know, they're not an
Speaker 1: equal test taker. With that said, it's pretty clear that
Speaker 1: things like these standardized tests, in conjunction with other data
Speaker 1: points like grades and recommendations, do correlate pretty high with
Speaker 1: college readiness. And so when you take some of those
Speaker 1: things out, you do have to ask, well, what is
Speaker 1: going to replace it? A lot of people forget the history.
Speaker 1: The reason why the set was even created was because
Speaker 1: the hundred years ago it was so unequal. You have
Speaker 1: to essentially go to a famous school to get into
Speaker 1: a famous school. Uh. And then the SAT emerged and
Speaker 1: that then it became more of a meritocracy. So it
Speaker 1: has to be replaced with something else. One possibility is
Speaker 1: maybe things like Mastery on con Academy could be viewed
Speaker 1: as another of and I wouldn't use it viewed as
Speaker 1: a replacement, but it could be viewed as another way
Speaker 1: to understand student's readiness. And what's appealing about that. It's
Speaker 1: not just based on how you perform on one Saturday morning.
Speaker 1: You can always improve it, and just by the virtue
Speaker 1: of working on it, you're learning more. Talking about sort
Speaker 1: of the inequalities that the S A T and other
Speaker 1: standardized tests were meant to combat, and obviously that is
Speaker 1: a debate that will rage on for however long those
Speaker 1: tests exist. One of the other inequalities, it feels like
Speaker 1: this pandemic has laid there is around technology, and I
Speaker 1: wonder what you make of that and what you've learned
Speaker 1: and what we all should be taking away from this
Speaker 1: in terms of what sort of access students of all
Speaker 1: shapes and sizes and socioeconomic status need in order to
Speaker 1: really learn. Yeah, and I don't think I'm telling anything
Speaker 1: that's surprising to folks, But as we give to this
Speaker 1: COVID crisis, not just to keep learning on a platform
Speaker 1: like Academy, but frankly, let's just stay connected with franks,
Speaker 1: to stay conected with friends and family. It's it's been
Speaker 1: a lifeline for for most of us, and in many
Speaker 1: parts of the country, there's the population that does not
Speaker 1: have devices at home or reasonable internet access at home,
Speaker 1: and so that frankly has always been a problem. People
Speaker 1: have talked about the digital bide, and now with this
Speaker 1: whole state at home order and schools having to close physically,
Speaker 1: it's become that much worse. The silver lining, if there
Speaker 1: is one, is that, because it's become so urgent, you're
Speaker 1: seeing government, school districts, corporations take action like they were
Speaker 1: taken before. New York City public schools they distributed almost
Speaker 1: three thousand laptops in a matter of weeks. They got
Speaker 1: the local telecom carriers to get free internet access. Miami
Speaker 1: Dade did something similar in Las Vegas, Los Angeles. So
Speaker 1: one silver lining is because it's such a urgent need,
Speaker 1: a lot of the digital divide hopefully will get closed
Speaker 1: because there's a lot more motivation to do it. But
Speaker 1: obviously you need that access if you're able to tap
Speaker 1: into everything else like kon, Academy or anything else. Yeah,
Speaker 1: that's a good point because that's the thing we're trying
Speaker 1: to figure out to sell is you know how much
Speaker 1: stays with us? So I love to hear those stories,
Speaker 1: you know about free WiFi and the equipment being you know,
Speaker 1: distributed to those who didn't have it. How much of
Speaker 1: it do you think stays with us on the other
Speaker 1: side of it. I think it's gotta stay. I can't
Speaker 1: imagine a world where they've done it and then they
Speaker 1: have to take it back. You know. The heavy lifting,
Speaker 1: frankly has already been done. And every school district that
Speaker 1: we've always talked about, you know, we've always talked about
Speaker 1: the value of personalized learning, about students being able to
Speaker 1: learn in a way that's not bow by time or space,
Speaker 1: and and teachers will be able to understand data when
Speaker 1: kids are doing homework and things like that, and everyone
Speaker 1: intellectually agrees with it, But then they would say, but
Speaker 1: there's ten percent of the kids who don't have interactent homes.
Speaker 1: So we can't do this innovation for the entire classroom.
Speaker 1: And so now that there's been a will and a desire,
Speaker 1: uh and and an action taken to close the digital divide,
Speaker 1: I can't imagine that we'll go back on that. So,
Speaker 1: sal as you think about a world in which we are,
Speaker 1: you know, remain concerned about health and safety, and we're
Speaker 1: rethinking what school looks like. We know that there's some
Speaker 1: amount of online learning we can do. We think about
Speaker 1: hybrid situations where you know, maybe you have some kids
Speaker 1: in the classrooms, some kids remote learning. What's feasible I mean,
Speaker 1: knowing this world as well as you do, what is
Speaker 1: a feasible way that we can really integrate technology into
Speaker 1: some sort of you know, for lack of better terms,
Speaker 1: sort of hybrid solution. Yeah, it's pretty cure that this
Speaker 1: coming back to school's going to have to be hybrid
Speaker 1: in some way, shape or form. There's going to be
Speaker 1: kids whose families don't steel comfortable sending them. They might
Speaker 1: have health issues. That are family member. Might you know,
Speaker 1: they might have a senior their grandparents lives with them.
Speaker 1: And so I think school districts are and and colleges
Speaker 1: are really trying to figure out how do you do
Speaker 1: this in the world where some kids might be there,
Speaker 1: but then there's half the kids who are watching from home.
Speaker 1: So the reality is they're going they will have to
Speaker 1: lean more on what you can call asynchronous tools like
Speaker 1: academy where kids can learn at their own time and pace,
Speaker 1: and then teachers can monitor and then leverage video conferencing,
Speaker 1: whether room or Google meets or whatever. More uh, even
Speaker 1: when they are live with the students, because they're going
Speaker 1: to have some subset of the kids who aren't there,
Speaker 1: and when you when you lean more on these types
Speaker 1: of tools, you know, I've been I'm talking to a
Speaker 1: lot of teachers about this. It's always been the case
Speaker 1: that a lecture can be a little bit not engaging
Speaker 1: for a lot of students. And it's even more so
Speaker 1: if you're doing a video conference with your lecturing the
Speaker 1: whole time, that might as well be a video And
Speaker 1: so this is really pushing teachers in school to think
Speaker 1: about how do we make it much more interactive how
Speaker 1: do we pull those kids who are watching from home
Speaker 1: into the conversation and have them interact. So what role
Speaker 1: do you think online learning virtual learning will have ultimately
Speaker 1: on higher education. I know people already get degrees, but
Speaker 1: I'm thinking about those institutions where, you know, part of
Speaker 1: the experience, a big part of it is being on
Speaker 1: campus somewhere among other students. And I do wonder, especially
Speaker 1: as higher education has gotten so expensive, you know, whether
Speaker 1: or not there might be some kind of mix going
Speaker 1: on in the future. That's what I think too. I
Speaker 1: think this crisis has been a forced on bundling of
Speaker 1: what higher education offers. It offers essentially three things. It
Speaker 1: offers an education like you will learn of this set
Speaker 1: of skills. It offers socialization, being able to hang out
Speaker 1: in the plot and throw the frisbee, or go to
Speaker 1: parties on weekends, or hang out in the dorm and
Speaker 1: talk about your your life dreams with folks that you've
Speaker 1: you've met. And then it does credentially. And I think
Speaker 1: we've talked about in the past that this is the
Speaker 1: direction that we might go in anywhere regardless. But you're
Speaker 1: seeing record numbers of kids are deferring, you know, even
Speaker 1: to very prestigious universities because they're like, well, I really
Speaker 1: wanted to pay that tuition because I wanted to hang
Speaker 1: out with kids in the quad and have that experience.
Speaker 1: And and they're realizing that they can get some of
Speaker 1: the learning just find virtually on you know, virtual community
Speaker 1: college or on a mook or some other type of platform.
Speaker 1: So I think it's going to be really interesting. My
Speaker 1: gut sense is education as a whole. You might see
Speaker 1: a little bit of an unbundling where there will always
Speaker 1: be certain pieces that are happening on video conferencing virtually,
Speaker 1: especially for older students, college A students or adult learners,
Speaker 1: and then for those who want that in person experience,
Speaker 1: there's waste for them to get it. That's how can
Speaker 1: the founder of con Academy, and he s this is
Speaker 1: one of the world I feel like education and healthcare
Speaker 1: they have been slow to innovate. And I do think
Speaker 1: the impact of the world being shut down by the virus,
Speaker 1: we're going to see some big changes. And I do
Speaker 1: think that in foods, online learning well, and I dare
Speaker 1: say not to be overly glib, but you know, it's
Speaker 1: one thing to get a kick in the butt. This
Speaker 1: is a kick in the teeth in many ways for
Speaker 1: the world of education. And you do wonder the college
Speaker 1: presidents that you and I have talked to, the parents
Speaker 1: that we are that we talked to all the time.
Speaker 1: Everyone's thinking about it from K through college, how learning
Speaker 1: will be different. And that wraps up the first hour
Speaker 1: of the weekend edition of Bloomberg Business Week from Bloomberg Radio.
Speaker 1: I'm Jason Kelly and I'm Carol Mass are plenty coming
Speaker 1: up in our next hour, We're gonna hear about the
Speaker 1: future of digital fitness with Jason LeRose of Equinox Media. Man,
Speaker 1: they've been pivoting two more digital offerings of fitness for
Speaker 1: all of those who are at home well. And also,
Speaker 1: if you want to get out, you might not feel
Speaker 1: like getting on a commercial flight, and maybe you have
Speaker 1: the means to get on a private jet. Andrew Collins,
Speaker 1: he's the CEO of Cynthia Jets, certainly seeing a boost
Speaker 1: in his business and thinking about how it may be
Speaker 1: different going forward. And Nancy Spielberg Carol, Yeah, it's an
Speaker 1: interview we were really looking forward to. Yes, folks, you
Speaker 1: re ignize the name. It's the little sister of Steven.
Speaker 1: I gotta say, just talking about their growing up, what
Speaker 1: their parents did to really foster creativity and she and
Speaker 1: her siblings was really wonderful and also just getting her
Speaker 1: thoughts about how do we make films going forward. So
Speaker 1: a really wonderful conversation all that I had. This is Bloomberg.
Speaker 1: This is Bloomberg Business Week from Bloomberg Radio. Hello, I'm
Speaker 1: Carol Masser and I'm Jason Kelly. Today, well, we're bringing
Speaker 1: you some of the most important and we hope in
Speaker 1: formative conversations we had on our daily Bloomberg Business Week
Speaker 1: radio show. And just some of the conversations we had
Speaker 1: was with the Sentient Jet president CEO Andrew Collins. Now, understandably,
Speaker 1: demand just dropped off as soon as the world shut down,
Speaker 1: but now what they're seeing is demand come back and
Speaker 1: people who now view private aviation as a necessity rather
Speaker 1: than as a luxury. That's right. I love talking about
Speaker 1: flying private. Also, we always love talking about fitness and
Speaker 1: the movies. We heard about the fitting aside from Jason
Speaker 1: Rose over at Equinox and the movies from Nancy Spielberg.
Speaker 1: Yet you recognize the last name, Yeah, absolutely, and we
Speaker 1: know Jason that Whahwei was in the news once again
Speaker 1: this week at Canadian judge ruling that the company's CFO
Speaker 1: will have to stay under house arrest as our extradition
Speaker 1: hearing is continue. There's also, let's not forget the backdrop
Speaker 1: of once again increased tension between the United States and
Speaker 1: China over many many different matters, including China really stepping
Speaker 1: up its uh moves to really control Hong Kong. So
Speaker 1: with all that happening, Jason, we got a chance to
Speaker 1: catch up with Hahwei Technologies, usays Chief security Officer Andy
Speaker 1: Purty Well. The effort against Miss Mong, our chief financial officer,
Speaker 1: is part of the overall effort for the last couple
Speaker 1: of years by the US government to carpet bomb WAWE
Speaker 1: out of existence, and in terms of the impact on
Speaker 1: the company, the decision involving Miss Mong and the process
Speaker 1: for extraditional take quite a number of months, if not years,
Speaker 1: before there might be a actual trial in the Eastern
Speaker 1: District of New York. And we have great confidence in
Speaker 1: the legal systems of Canada and the US, so we
Speaker 1: feel like I shall be vindicated in the end. But
Speaker 1: right now, this this campaign against Wawei, the recent ramping
Speaker 1: up of pressure on American company's ability to sell to WAWI,
Speaker 1: even through international companies, is going to have a tremendous
Speaker 1: negative impact on American jobs. You know, it's interesting, you
Speaker 1: know that this is going on amid a week or
Speaker 1: two where we are seeing once again heightened tensions UH
Speaker 1: and back and forth between the head of the United States,
Speaker 1: President Trump and of course Chinese President Jen Ping. And
Speaker 1: what how do you see this? Uh? You know, you've
Speaker 1: got to run your business amid kind of all of
Speaker 1: this fury, and we're trying to figure out is that
Speaker 1: rhetoric or is it going to turn into actions that
Speaker 1: ultimately impact both China and the United States. Well, there's
Speaker 1: certainly been an impact on our company. The impact US
Speaker 1: about twelve million dollars last year, and we haven't been
Speaker 1: able to estimate what the impact would be this year.
Speaker 1: Of course, it's it's complicated by the U added factor
Speaker 1: of the pandemic, But you look at the overall situation,
Speaker 1: the geopolitical situation between China and the US is what
Speaker 1: we're talking about, and that's exacerbated now by the US
Speaker 1: presidential campaign. So the the the competition among President Trump
Speaker 1: and UH. A former Vice President Biden to out maneuver
Speaker 1: the other in terms of anti China rhetoric, kind of
Speaker 1: a new red scare kind of thing. UM indicates that
Speaker 1: this battle is going to go on at least through
Speaker 1: the election. And there doesn't seem to be rational discussion
Speaker 1: and people don't seem to care about the fact that
Speaker 1: American jobs are going to be lost as a result.
Speaker 1: And can you quantify, you know, the jobs piece of this.
Speaker 1: I understand that obviously things are complicated, but in terms
Speaker 1: of the pandemic, and it remains to be seen what
Speaker 1: the total economic impact is is. But help us understand.
Speaker 1: You know, you guys have several offices around the country here,
Speaker 1: what is it? Men? And and maybe help us understand
Speaker 1: sort of the one two punches that were of this
Speaker 1: action and this UH confrontation between the United States and
Speaker 1: China as well as the pandemic. It synthesized that for
Speaker 1: us if you can andy well in terms of within
Speaker 1: the US, we have two issues. We have the issue
Speaker 1: of whether or not Huawei can sell to American companies
Speaker 1: and right now we're serving parts of rural America. UH.
Speaker 1: And the other issue is the ability of American companies
Speaker 1: nearly three want to be able to sell to Wali.
Speaker 1: So in terms of our global revenues, which last year
Speaker 1: or despite all this, we're up about. Um, you know,
Speaker 1: we were impacted about twelve billion dollars. But the uh,
Speaker 1: the the annual amount that we procure from American companies
Speaker 1: is not just to serve our customers in America, it's
Speaker 1: our global market. At its height, we had a thirty
Speaker 1: or thirty two percent of all Walwi global components came
Speaker 1: from American companies and they're primarily in the semiconductor industry.
Speaker 1: And you can see in the last couple of months, Uh,
Speaker 1: they can speak for it a lot better than that
Speaker 1: I can that American UM semiconductor companies and their association's
Speaker 1: trade associations have basically been saying, look, the limitations on
Speaker 1: the ability of American companies to sell a Walway's averaging
Speaker 1: about twelve billion a year. That is estimated to be
Speaker 1: between forty and fifty thousand direct jobs, not to count
Speaker 1: the indirect jobs. And so the fact is, well, you know,
Speaker 1: we're fighting for our survival. Um, We're gonna be okay,
Speaker 1: and we would like to continue to buy from Amritan
Speaker 1: companies and buy as an American want to be able
Speaker 1: to see those jobs continue. If we have to, will
Speaker 1: go elsewhere, and then we won't come back and those
Speaker 1: American jobs will go away, and and that's not going
Speaker 1: to help America and the long term, it's not gonna
Speaker 1: hurt Walwi and that the strategy you talked about the
Speaker 1: bigger picture. The strategy is that the US wants to
Speaker 1: hurt walwih to hurt China because they are afraid of
Speaker 1: the rise of China economically and militarily. So so that's
Speaker 1: really at the heart of it. And so instead of
Speaker 1: promoting greater innovation technology by America, they're trying to hurt
Speaker 1: Wally and that's not going to help America visa the
Speaker 1: China in terms of a long term competition, which is
Speaker 1: which is very important. That's Wawei Technologies USA Chief security
Speaker 1: Officer Andy Purty and Jason We've talked to him several
Speaker 1: times over the last couple of years, and at many
Speaker 1: times it was with the backdrop of increased tensions between
Speaker 1: the United States and China. And here we were again,
Speaker 1: well in this company in many ways, and technology and
Speaker 1: intellectual property and national security, they all collide. They all
Speaker 1: sit at this nexus, and it's such an important thing
Speaker 1: to understand as we try to find a way forward
Speaker 1: with China. All right, you're listening to Bloomberg Business Week.
Speaker 1: Coming up, Jason LeRose of Equinox Media on the pivot
Speaker 1: to digital fitness and now how the virus is changing
Speaker 1: all of us when it comes to our overall health.
Speaker 1: This is Bloomberg. This is Bloomberg Business Week from Bloomberg Radio.
Speaker 1: We're bringing you some of the most important and informative conversations.
Speaker 1: Interesting conversations we had throughout the week on our daily
Speaker 1: radio show. There were so many, Jason, absolutely, and we
Speaker 1: love talking about fitness for sure. We also know that
Speaker 1: that business has changed dramatically. Boutiques are closed, big box
Speaker 1: gyms are closed for the most part as well. So
Speaker 1: how are people working out? Well, they're doing it, as
Speaker 1: they say on the line. We caught up with Jason LeRose.
Speaker 1: He's the CEO of Equinox Media. They've got a new
Speaker 1: app and they're learning a lot about their customers. What's interesting, though,
Speaker 1: is we started on this journey, you know, more than
Speaker 1: a year ago, and we started on the journey because
Speaker 1: we knew the squeezing fitness in doesn't always work into
Speaker 1: a busy schedule. We knew that there were lots of
Speaker 1: reasons that our members, particularly Equinox, couldn't always make it
Speaker 1: to a club. Um, while we had a on list
Speaker 1: and we were talking with them, we we never anticipated
Speaker 1: a year ago that the list would include pandemic. So
Speaker 1: now we're seeing, you know, more demand than ever for
Speaker 1: people trying to continue their fitness regimens while they're you know,
Speaker 1: while they're at home, and we've been been rolling out
Speaker 1: really quickly to try to meet those demands because you know,
Speaker 1: our members certainly have been been raised in their hand
Speaker 1: looking for looking for an opportunity to keep it going.
Speaker 1: Tell us about what you guys were doing pre COVID
Speaker 1: nineteen and what you are doing now, I'm sure. So
Speaker 1: the vision here has always been to build something that's
Speaker 1: multi brand, it's multimodality, and something that's in real life
Speaker 1: and on demand altogether. Um, we believe that there there
Speaker 1: was space for it, and there wasn't anyone who was
Speaker 1: able to deliver that in the marketplace. So what we
Speaker 1: had done is, you know, partnered with some of the
Speaker 1: very best brands in the fitness space, like Soul Cycle,
Speaker 1: like Equinox, to bring great experiences on demand. You know,
Speaker 1: it's it's great to find those experiences when you make
Speaker 1: it in real life. What's challenging sometimes is then when
Speaker 1: you when you get home, sometimes that content can be
Speaker 1: a little little more underwhelming. And so we worked really hard, uh,
Speaker 1: you know, to build our own production facility and to
Speaker 1: bring the best of those brands in real life to
Speaker 1: an on demand experience that continues to be true. Um.
Speaker 1: You know, we spent a year building it, building the technology,
Speaker 1: building the television studio, building the library. What's changed is really,
Speaker 1: you know, the pandemic has put us in a position
Speaker 1: where we've needed to support our members faster, and so
Speaker 1: we've worked really hard to get out to a much
Speaker 1: larger audience faster than we anticipated. And and while we
Speaker 1: we've always been talking with our members, it's been interesting
Speaker 1: to see how their workouts have changed in this kind
Speaker 1: of a world versus you know, a time when there
Speaker 1: was a little bit more freedom. So how had their
Speaker 1: workouts changed? And I do wonder because you can see
Speaker 1: kind of what they're using, how long they're using it for.
Speaker 1: Are their patterns emerging, Jason in terms of what they
Speaker 1: like more or less or in greater quantities during this
Speaker 1: time than may be they would like during a non pandemic. Yeah,
Speaker 1: you know, there really have been some interesting things I think,
Speaker 1: you know. The first one that stood out for me,
Speaker 1: and this is, you know, this has been a personal
Speaker 1: part of the journey as well, is is how big
Speaker 1: meditation has been, uh, you know, the mental uh side
Speaker 1: of this, um, you know, just the need for mindfulness
Speaker 1: has probably been been brought to the forefront for many
Speaker 1: of us. And so we're seeing amazing completion rates on
Speaker 1: our meditation classes overall, and it's been super popular and
Speaker 1: and even for me, it's become part of my regimen,
Speaker 1: so you know, that's been a piece of it. The
Speaker 1: second thing is we're seeing a lot more body weight
Speaker 1: exercises than we anticipated. Of course, you know, we we
Speaker 1: thought we would be in a world where our members
Speaker 1: would be, you know, using access that they have to
Speaker 1: the clubs along with brus to to provide a complimentary
Speaker 1: experience when they're when they're in their apartments or their
Speaker 1: homes and they may not have as much access to equipment.
Speaker 1: We're seeing more more and more body weight in there. Um.
Speaker 1: But it's interesting for us also seeing how many double workouts.
Speaker 1: We've seen you know, people putting shorter time frames together,
Speaker 1: maybe a twenty minute workout together with a forty five
Speaker 1: minute workout and just going back to back, which um,
Speaker 1: you know, we we didn't necessarily anticipate, but watching some
Speaker 1: of that that behavior has been, uh, has been cool.
Speaker 1: And then lastly, you know, running has probably shocked us.
Speaker 1: Of course, running is a huge modality and people excited
Speaker 1: about it. Um, you know, we started Precision Run is
Speaker 1: a wonderful brand with the studio down on twenty one Street.
Speaker 1: That's a treadmill based, science backed running running class and
Speaker 1: it's a really cool place. Um, people have been dying
Speaker 1: for outdoor runs. You know, left access to treadmills, and
Speaker 1: people just want to get out if they're in a
Speaker 1: place where they can do that safely. And so our
Speaker 1: outdoor runs, as we've been testing, those have been incredibly
Speaker 1: strong and and so all those things have been just
Speaker 1: a little different in this world than we anticipated up front.
Speaker 1: You know, Jason, I am curious how many of the
Speaker 1: people that you think are actively engaging with you online
Speaker 1: right now stay there as they come back also to
Speaker 1: physical locations, Well, Carol, I definitely agree. Is going to
Speaker 1: be both you know, digital and physical world. And I
Speaker 1: certainly believe that pre pandemic, we had of the members
Speaker 1: at Equinox who had some form of digital fitness app
Speaker 1: on their phones already, so they were living in a
Speaker 1: digital and physical world, and they were using that digital
Speaker 1: to augment the times that they couldn't make it to
Speaker 1: a claub or to a studio or something else. So
Speaker 1: I think that will remain. What I hope is is
Speaker 1: that this newfound focus or maybe maybe continued focus on
Speaker 1: health and well being means that we'll all get into
Speaker 1: some healthier habits over this time and that those things
Speaker 1: will stay with us. But certainly we saw that mix
Speaker 1: of of physical and digital beforehand we expected to continue.
Speaker 1: You know, Jason, I wanted to ask you sort of
Speaker 1: about this mega trend toward a healthier life, because before
Speaker 1: you got into this gig uh, you ran a big
Speaker 1: chunk of under armour as president of North America, and
Speaker 1: you know that was a place where you guys, we're
Speaker 1: also thinking about sort of the physical and the digital
Speaker 1: map my run you sort of integrating all of that
Speaker 1: in and and I do wonder whether this is a
Speaker 1: trend in your estimation that was happening, and that this
Speaker 1: epidemic or pandemic has sort of accelerated, has it changed it?
Speaker 1: Like what what? What are the sort of contours because
Speaker 1: this is something you've been watching for a couple of
Speaker 1: decades now, Yeah, I mean, look, I think it's definitely
Speaker 1: an accelerant. I don't think that there's much question that
Speaker 1: this is changing all of us a bit in terms
Speaker 1: of what our our overall habits look like. But the
Speaker 1: need for time has been going on for a lot
Speaker 1: longer than the last couple of months. You know, we've
Speaker 1: all we've all struggled for that currency no matter what.
Speaker 1: And what we find is the more healthy you want
Speaker 1: to be, the busier you maybe also and so time
Speaker 1: it becomes even harder to find, and investing it in
Speaker 1: these things, um, you know, from a digital standpoint just
Speaker 1: gives you a little bit more freedom for those days
Speaker 1: that worked novel or a sick child or or you know,
Speaker 1: just a long day or whatever it might be gets
Speaker 1: in the way. And so we we always have seen
Speaker 1: digital being you know, uh an and solution and not
Speaker 1: an OAR solution. Um. But but we've we've watched how
Speaker 1: that's progressed, and I think for us, you know, we
Speaker 1: certainly happened to be at a moment where we can
Speaker 1: help more of our members and writers than we thought, uh,
Speaker 1: you know, in Mayo of two thousand and twenty. So
Speaker 1: we're fortunate for that. And that's Jason LeRose, CEO of
Speaker 1: Equinox Media Carol and we both love fitness. We love
Speaker 1: catching up with entrepreneurs and managers in this space. We
Speaker 1: know the world of fitness has changed dramatically. I think
Speaker 1: the big question which Jason really spoke to is what
Speaker 1: does it look like going forward now that we have
Speaker 1: this new channel of source, this new way of working
Speaker 1: out well, and he answered it right. He said he
Speaker 1: expects digital as an and solution rather than an or.
Speaker 1: And I do wonder about that. I love going to
Speaker 1: studios to work out, but I also have loved the
Speaker 1: convenience of being able to open up something online and
Speaker 1: just do it, you know, in my home, and it
Speaker 1: be so convenient. So we'll see how much that sticks around.
Speaker 1: All right, you're listening to Bloomberg Business. We're coming up
Speaker 1: how the coronavirus is transforming the world of private aviation,
Speaker 1: calling all private jets. This is Bloomberg, this is Bloomberg
Speaker 1: Business Week from Bloomberg Radio. Today, we're bringing some of
Speaker 1: the most important, we hope informative conversations we had on
Speaker 1: our daily Bloomberg Business Week radio show. And one of
Speaker 1: those conversations Jason was with Andrew Collins. He's the presidency
Speaker 1: of sentiate Jet, and you know, they understandably initially saw
Speaker 1: drops in service and demand, but now it is back
Speaker 1: and it's got some interesting new trend lines we are seeing, uh,
Speaker 1: you know, from a business standpoint, you know, I think
Speaker 1: a very interesting time. We saw the reaction to the
Speaker 1: pandemic in late March, where we saw a lot of
Speaker 1: our flying volume drop. Uh initially, and I can tell
Speaker 1: you that walking into April, it originally looked like we
Speaker 1: were probably about ten per of what our volume projects
Speaker 1: to be and so that would have been about a
Speaker 1: hundred legs, and I mean it was an absolute low point.
Speaker 1: But rapidly we started to see people that started to
Speaker 1: think about private jets a little bit different. And honestly,
Speaker 1: I'm seeing people behave you know, usually this is more
Speaker 1: about a lifestyle or business productivity tool, but it's almost
Speaker 1: migrated over to a utility during this time. And uh,
Speaker 1: what we're seeing are people that want to control their environment.
Speaker 1: They want to control how many touch points you know,
Speaker 1: they're exposed to. And so because of that, we're seeing
Speaker 1: a lot of new entrants, and our volume has come
Speaker 1: back gangbusters in May. And you know, I could tell
Speaker 1: you it's a reaction to the pandemic, but I tend
Speaker 1: to think that we're probably going to see a whole
Speaker 1: set of new entrants to flying privately based on this,
Speaker 1: And so andrews you as you think about this, and
Speaker 1: you put it in the context of previous crises, both
Speaker 1: financial and and otherwise, And obviously nine eleven is the
Speaker 1: comparison that so many people make in terms of the
Speaker 1: scope of this, and obviously two very different tragedies in
Speaker 1: a way. But obviously that was probably the last time
Speaker 1: we saw travel just effectively go away for some period
Speaker 1: of time, although shorter uh in duration than you know,
Speaker 1: how do you think about the future of travel overall? It,
Speaker 1: especially the future of air travel. So I think that
Speaker 1: air travel has changed forever. Um. I think that the
Speaker 1: way that we think about commercial airlines, you know, last year,
Speaker 1: I think two and a half million people a day
Speaker 1: would process to the t s A and commercial airlines
Speaker 1: in April it was somewhere around nine hundred thousand. So
Speaker 1: it's an industry that's been impacted, and I'm sure you've
Speaker 1: talked about it so much, and it's one that is
Speaker 1: so capital intensive that it feels like it's a tough
Speaker 1: model to pursue moving forward. I think really truly this
Speaker 1: notion of control, this notion of a limited environment. I
Speaker 1: don't know that that's the long term, but I certainly
Speaker 1: see in the you know, the next twelve to eighteen months, UM,
Speaker 1: really a focus on making sure people are are at
Speaker 1: their least kind of exposed to crowds. UM. As far
Speaker 1: as the crisis goes, you mentioned nine eleven. Nine eleven
Speaker 1: is actually when our business started to really, uh to
Speaker 1: kind of shine unfortunately UM from the incident. But commercial
Speaker 1: was only down for a little bit. It was also
Speaker 1: here for the financial crisis, and in the financial crisis
Speaker 1: a lot of the segment disappeared. This is very different
Speaker 1: in private. You know, not only did you have a
Speaker 1: high capital overhang coming in and a robust stock market,
Speaker 1: but we were in Q one seeing record flying. So
Speaker 1: I think the exposure was significant. And I would just
Speaker 1: simply say that as I watch kind of this, this
Speaker 1: whole volume increase in our business. It just tells me
Speaker 1: that people are probably going to consider private, whether that's aviation,
Speaker 1: whether that's a villa, whether that's some form of you know,
Speaker 1: a limited exposure environment. I think that's where we are
Speaker 1: for a little bit. Well that's thought. I was curious
Speaker 1: when you talk about the new entrance. Is it folks
Speaker 1: who are trying to go on vacation because they need
Speaker 1: a break? Uh? Is it folks who need to go
Speaker 1: is it business folks? Who is it that that's coming up?
Speaker 1: And we've just got about forty five seconds here and
Speaker 1: then we'll come back and talk some more, no problem.
Speaker 1: Probably about three thousand flying hours this month, if not more,
Speaker 1: and about three quarters of it is personal, whether it's
Speaker 1: shelter to shelter, or it's just change of scenery. But
Speaker 1: I think some of it's reactive and some of it
Speaker 1: is people that are moving on a personal level. Business
Speaker 1: is slowly coming back, but not nearly where we would
Speaker 1: normally see it. That's Sentient Jet President CEO Andrew Collins.
Speaker 1: And you know what's interesting, I thought Jason one of
Speaker 1: the things he said and he talked to about how
Speaker 1: they are different from you know, the big major airlines,
Speaker 1: and he said commercial airlines have something like seven touch points, right,
Speaker 1: so they need to think about how many people are
Speaker 1: involved and what that means for passenger safety. He says
Speaker 1: they've got about twenty or thirty touch points. So he goes,
Speaker 1: we already have a big advantage to start from a
Speaker 1: much better point when it comes to reopening and getting
Speaker 1: people back flying well. And you do wonder, right if
Speaker 1: especially and this is at the high end, of course,
Speaker 1: but if people are traveling less, do their budgets get
Speaker 1: a little bigger per trip? And certainly for businesses and
Speaker 1: maybe even for personal travel, is this something that people
Speaker 1: start to spend more on. You're listening to Bloomberg this week.
Speaker 1: Coming up filmmaker at Nancy Spielberg. Yep, she's Steven's little sister.
Speaker 1: She tells us about the impact of the virus on
Speaker 1: Hollywood and like our big brother, she's a storyteller at heart.
Speaker 1: This is Bloomberg. This is Bloomberg Business Week from Bloomberg Radio.
Speaker 1: Today we're bringing you some of the most important, we
Speaker 1: hope informative reversations we had on our daily Bloomberg Business
Speaker 1: Week radio show and one of those conversations, Jason was
Speaker 1: with Andrew Collins, he's the presidency of sentiate Jet, and
Speaker 1: you know, they understandably initially saw drops in service and demand,
Speaker 1: but now it is back and it's got some interesting
Speaker 1: new trend lines we are seeing, uh, you know, from
Speaker 1: a business standpoint, you know, I think a very interesting time.
Speaker 1: We saw the reaction to the pandemic in late March,
Speaker 1: where we saw a lot of our flying volume drop.
Speaker 1: Uh initially, and I can tell you that walking into April,
Speaker 1: it originally looked like we were probably about ten percent
Speaker 1: of what our volume projects to be and so that
Speaker 1: would have been about a hundred legs, and I mean
Speaker 1: it was an absolute low point. But rapidly we started
Speaker 1: to see people that started to think about private jets
Speaker 1: a little bit different. And honestly, I'm seeing people behave
Speaker 1: you know, usually this is more about a lifestyle or
Speaker 1: business productivity tool, but it's almost migrated over to a
Speaker 1: utility during this time. And uh, what we're seeing are
Speaker 1: people that want to control their environment. They want to
Speaker 1: control how many touch points you know, they're exposed to.
Speaker 1: And so because of that, we're seeing a lot of
Speaker 1: new entrants and our volume has come back gangbusters in May,
Speaker 1: and you know, I could tell you it's a reaction
Speaker 1: to the pandemic, but I tend to think that we're
Speaker 1: probably going to see a whole set of new entrants
Speaker 1: to flying privately based on this, And so andrews you
Speaker 1: as you think about this, and you put it in
Speaker 1: the context of previous crises, both financial and and otherwise.
Speaker 1: And obviously nine eleven is the comparison that so many
Speaker 1: people make in terms of the scope of this, and
Speaker 1: obviously two very different tragedies in a way. But obviously
Speaker 1: that was probably the last time we saw travel just
Speaker 1: effectively go away for some period of time, although shorter
Speaker 1: uh in duration than you know, how you think about
Speaker 1: the future of travel overall, it especially the future of
Speaker 1: air travel. So I think that air travel has changed forever. Um.
Speaker 1: I think that the way that we think about commercial airlines.
Speaker 1: You know, last year, I think two and a half
Speaker 1: million people a day with process to the T s
Speaker 1: A and commercial airlines. In April it was somewhere around
Speaker 1: nine hundred thousand. So it's in the industry that's been impacted.
Speaker 1: And I'm sure you've talked about it so much, and
Speaker 1: it's one that is so capital intensive that it feels
Speaker 1: like it's a tough model to pursue moving forward. I
Speaker 1: think really truly this notion of control, this notion of
Speaker 1: a limited environment. I don't know that that's the long term,
Speaker 1: but I certainly see in the you know, the next
Speaker 1: twelve to eighteen months, UM, really a focus on making
Speaker 1: sure people are are at their least kind of exposed
Speaker 1: to crowds. UM. As far as the crisis goes, you
Speaker 1: met Sho nine eleven. Nine eleven is actually when our
Speaker 1: business started to really uh to kind of shine unfortunately
Speaker 1: UM from the incident, but commercial was only down for
Speaker 1: a little bit. I was also here for the financial crisis,
Speaker 1: and in the financial crisis a lot of the segment disappeared.
Speaker 1: This is very different in private. You know, not only
Speaker 1: did you have a high capital overhang coming in and
Speaker 1: a robust stock market, but we were in Q one
Speaker 1: seeing record flying. So I think the exposure was significant.
Speaker 1: And I would just simply say that as I watch
Speaker 1: kind of this this whole volume increase in our business,
Speaker 1: it just tells me that people are probably going to
Speaker 1: consider private, whether that's aviation, whether that's a villa, whether
Speaker 1: that's some form of you know, a limited exposure environment.
Speaker 1: I think that's where we are for a little bit. Well,
Speaker 1: that's what I was curious when you talk about the
Speaker 1: new entrance. Is it folks who are trying to go
Speaker 1: on vacation because they need a break? Uh? Is it
Speaker 1: folks who need to go? Is it business folks? Who
Speaker 1: is it that that's coming up? And we've just got
Speaker 1: about forty five seconds here and then we'll come back
Speaker 1: and talk some more, no problem. Probably about three thousand
Speaker 1: flying hours this month, it's not more, and about three
Speaker 1: quarters of it is personal, whether it's shelter to shelter
Speaker 1: or it's just change of scenery. But I think some
Speaker 1: of it's reactive and some of it is people that
Speaker 1: are moving on a personal level. Business is slowly coming back,
Speaker 1: but not nearly where we would normally see it. That's
Speaker 1: Sentient Jet president CEO Andrew Collins. And you know what's interesting,
Speaker 1: I thought Jason one of the things he said, and
Speaker 1: he talked to about how they are different from you know,
Speaker 1: the big major airlines, and he said, commercial airlines have
Speaker 1: something like seven hundred touch points, right, so they need
Speaker 1: to think about how many people are involved and what
Speaker 1: that means for passenger safety. He says, they've got about
Speaker 1: twenty or thirty touch points. So he goes, we already
Speaker 1: have a big advantage to start from a much better
Speaker 1: point when it comes to reopening and getting people back
Speaker 1: flying well. And you do wonder, right if especially and
Speaker 1: this is at the high end of cores, but if
Speaker 1: people are traveling less, do their budgets get a little
Speaker 1: bigger per trip? And certainly for businesses and maybe even
Speaker 1: for personal travel, is this something that people start to
Speaker 1: spend more on. You're listening to Bloomberg this week, coming
Speaker 1: up filmmaker at Nancy Spielberg. Yep, she's Steven's little sister.
Speaker 1: She tells us about the impact of the virus on Hollywood,
Speaker 1: and like our big brother, she's a storyteller at heart.
Speaker 1: This is Bloomberg