1 00:00:07,480 --> 00:00:11,119 Speaker 1: Welcome to another episode of Strictly Business, the podcast in 2 00:00:11,160 --> 00:00:13,600 Speaker 1: which we speak with some of the brightest minds working 3 00:00:13,640 --> 00:00:18,200 Speaker 1: in the media business today. I'm Andrew Wallenstein with Variety. 4 00:00:18,880 --> 00:00:22,120 Speaker 1: Are you ready to get radical? That's the message from 5 00:00:22,160 --> 00:00:26,560 Speaker 1: our next guest, John Peters, Managing director of the Media 6 00:00:26,560 --> 00:00:31,000 Speaker 1: and Entertainment lead at the Accenture consulting firm in Los Angeles. 7 00:00:31,360 --> 00:00:34,800 Speaker 1: He released a pretty bold report based on his proprietary 8 00:00:35,120 --> 00:00:40,280 Speaker 1: media Thrive Index last month that laid out fifty strategic 9 00:00:40,400 --> 00:00:45,080 Speaker 1: options from media companies looking to survive the tumultuous times 10 00:00:45,280 --> 00:00:47,560 Speaker 1: that we're in, and he's here to walk us through 11 00:00:47,600 --> 00:01:00,120 Speaker 1: his thinking. When we're back in just a moment, and 12 00:01:02,440 --> 00:01:05,400 Speaker 1: we are back with John Peters from Accenture, who has 13 00:01:05,520 --> 00:01:09,560 Speaker 1: a radical message for the media business, which begs the question, John, 14 00:01:10,080 --> 00:01:12,920 Speaker 1: what is it about the media business today that makes 15 00:01:12,959 --> 00:01:16,440 Speaker 1: it in need of a radical message? Exactly what state 16 00:01:16,480 --> 00:01:19,400 Speaker 1: do we find ourselves in that has made you characterize 17 00:01:19,440 --> 00:01:23,360 Speaker 1: this business as a quote landscape in disarray. 18 00:01:23,880 --> 00:01:26,680 Speaker 2: Yes. We break it down to three factors that are 19 00:01:26,800 --> 00:01:31,520 Speaker 2: changing consumer behavior, the entrance of big tech, and the 20 00:01:31,560 --> 00:01:34,200 Speaker 2: third is financial deterioration. Let me walk you through that 21 00:01:34,360 --> 00:01:37,800 Speaker 2: a little bit For the last three years, Eccentric's been 22 00:01:37,800 --> 00:01:42,880 Speaker 2: doing a global consumer survey six thousand consumers ten different countries, 23 00:01:43,360 --> 00:01:47,440 Speaker 2: and we've been watching the changes of media consumption and 24 00:01:47,520 --> 00:01:50,000 Speaker 2: their feelings about the current landscape. 25 00:01:50,080 --> 00:01:51,760 Speaker 3: There's enormous frustration. 26 00:01:52,240 --> 00:01:55,840 Speaker 2: For example, fifty four percent of them find it it 27 00:01:55,920 --> 00:01:58,560 Speaker 2: takes them over six minutes to find the next thing 28 00:01:58,600 --> 00:02:03,040 Speaker 2: to watch, So there's frustrating with the fragmentation, serial churning 29 00:02:03,160 --> 00:02:06,480 Speaker 2: is emerging. Forty seven percent of them are canceling more 30 00:02:06,520 --> 00:02:11,280 Speaker 2: subscriptions this year than last year, and there's enormous departure 31 00:02:11,320 --> 00:02:14,800 Speaker 2: from traditional media's you know. And as part of that 32 00:02:14,840 --> 00:02:17,680 Speaker 2: we'll talk about fifty nine percent of them believe user 33 00:02:17,720 --> 00:02:21,480 Speaker 2: generated content is as entertaining as traditional media. So there 34 00:02:21,520 --> 00:02:24,200 Speaker 2: is just a lot of challenges. 35 00:02:23,560 --> 00:02:25,000 Speaker 3: To the traditional space. 36 00:02:25,320 --> 00:02:28,760 Speaker 2: But the second one is big tech entering the marketplace. 37 00:02:29,320 --> 00:02:33,480 Speaker 3: They are upending traditional economics. They could give prime video, for. 38 00:02:33,440 --> 00:02:37,959 Speaker 2: Example, away for free, or they can bid up sports rights. 39 00:02:38,320 --> 00:02:44,000 Speaker 2: These disruptions make it very hard for those using older 40 00:02:44,040 --> 00:02:48,600 Speaker 2: economic models to continue to exist. And meanwhile, this has 41 00:02:48,639 --> 00:02:53,120 Speaker 2: all been in a context of media financials deteriorating the 42 00:02:53,200 --> 00:02:59,360 Speaker 2: amount of operating cash flow IBBIT margin and you know, 43 00:02:59,440 --> 00:03:02,520 Speaker 2: the growth of revenue. All have been struggling, and that 44 00:03:02,680 --> 00:03:08,360 Speaker 2: means that they have lacked the wherewithal to fight back. 45 00:03:08,520 --> 00:03:11,440 Speaker 1: Okay, John, but you've been in this business a long time. 46 00:03:11,919 --> 00:03:16,760 Speaker 1: Does all that truly represent some sort of unprecedented high 47 00:03:16,840 --> 00:03:20,800 Speaker 1: water mark for let's call it friction in the marketplace 48 00:03:20,960 --> 00:03:23,800 Speaker 1: or is this just the same amount of friction that 49 00:03:23,840 --> 00:03:28,040 Speaker 1: there's been going back five, ten, who knows how many years. 50 00:03:28,080 --> 00:03:29,320 Speaker 1: I mean, there's always problems. 51 00:03:29,440 --> 00:03:31,959 Speaker 2: Now, yes, I think at this point we're just seeing 52 00:03:32,040 --> 00:03:39,640 Speaker 2: such enterprise value deterioration, shareholder value deterioration, and perhaps no 53 00:03:40,600 --> 00:03:45,080 Speaker 2: pathway out. The pathway out had thought to have been streaming, 54 00:03:45,480 --> 00:03:48,680 Speaker 2: pivot to data, c own a client relationship or a 55 00:03:48,720 --> 00:03:52,800 Speaker 2: customer relationship instead of being wholesale and then you can 56 00:03:52,880 --> 00:03:55,840 Speaker 2: move out from there. It has not been the panacea 57 00:03:56,280 --> 00:03:59,400 Speaker 2: that had been hoped and as a result, there isn't 58 00:03:59,800 --> 00:04:02,840 Speaker 2: a sort of clear pathway. 59 00:04:02,440 --> 00:04:03,600 Speaker 3: Back to thriving. 60 00:04:04,160 --> 00:04:08,880 Speaker 2: And you know, Wall Street has voted and they made 61 00:04:08,880 --> 00:04:11,880 Speaker 2: their judgment, and that's why we're seeing depressed stock prices. 62 00:04:12,600 --> 00:04:14,200 Speaker 3: Some though, who have. 63 00:04:16,240 --> 00:04:19,880 Speaker 2: Whethered it have actually had a level of diversification that's 64 00:04:19,920 --> 00:04:23,119 Speaker 2: been a boon. Say they've had theme parks where they've 65 00:04:23,160 --> 00:04:27,080 Speaker 2: had broadband services that have been able to prop up 66 00:04:27,200 --> 00:04:31,719 Speaker 2: these businesses. But broadly speaking, we believe this is rather 67 00:04:31,920 --> 00:04:38,440 Speaker 2: existential because the added situation of extraordinarily deep pocketed clients 68 00:04:38,440 --> 00:04:45,520 Speaker 2: who big tech entrants who have no sentimentality for old 69 00:04:45,560 --> 00:04:49,719 Speaker 2: models do not need to play by the same level 70 00:04:50,200 --> 00:04:52,719 Speaker 2: ways of competition, and you're seeing it play out right 71 00:04:52,760 --> 00:04:55,800 Speaker 2: now in the economics of traditional media companies. 72 00:04:56,080 --> 00:05:00,440 Speaker 1: So to put some specifics on kind of you've been 73 00:05:00,480 --> 00:05:05,640 Speaker 1: speaking too generically to translate. It seems like the strategy 74 00:05:05,720 --> 00:05:10,599 Speaker 1: to imitate Netflix by the old media companies has not 75 00:05:10,760 --> 00:05:17,400 Speaker 1: really panned out, and the big tech companies, whether it's Meta, 76 00:05:17,560 --> 00:05:22,320 Speaker 1: whether it's Amazon, are eating old media's lunch. So what 77 00:05:22,360 --> 00:05:28,400 Speaker 1: are companies like Warner Media and Disney to do? Although 78 00:05:28,440 --> 00:05:30,760 Speaker 1: you are crediting the Disney's of the world for at 79 00:05:30,800 --> 00:05:34,400 Speaker 1: least having, say the parks business, and those who are 80 00:05:34,400 --> 00:05:38,920 Speaker 1: able to diversify like say Comcast and broadband, that gives 81 00:05:38,920 --> 00:05:40,000 Speaker 1: them some breathing room. 82 00:05:40,080 --> 00:05:45,120 Speaker 2: Fair translation, Certainly, diversification is one of the themes that 83 00:05:45,160 --> 00:05:48,760 Speaker 2: we will probably talk about more today, but certainly the 84 00:05:49,080 --> 00:05:51,839 Speaker 2: being a pure play media company, and honestly that includes 85 00:05:51,920 --> 00:05:56,440 Speaker 2: Netflix too. Is a tough game as those you're going 86 00:05:56,520 --> 00:06:00,440 Speaker 2: up against have additional revenue streams that can fill their 87 00:06:00,839 --> 00:06:04,920 Speaker 2: financial coffers and allow them to play differently, such as 88 00:06:05,040 --> 00:06:08,919 Speaker 2: as we see with Big tepatit bidding up the price 89 00:06:08,960 --> 00:06:09,799 Speaker 2: of sports rights. 90 00:06:10,120 --> 00:06:14,279 Speaker 1: So what does it take to thrive and what because 91 00:06:14,320 --> 00:06:17,880 Speaker 1: it's obviously more than just diversification, and what is a 92 00:06:18,040 --> 00:06:20,919 Speaker 1: thrive media index? Explain what that is? 93 00:06:21,640 --> 00:06:27,120 Speaker 2: Yes, so you know, like you, we have been observing 94 00:06:27,200 --> 00:06:29,839 Speaker 2: the marketplace get increasingly challenged. 95 00:06:30,560 --> 00:06:31,400 Speaker 3: We've done our. 96 00:06:31,320 --> 00:06:34,200 Speaker 2: Reinvent for Growth report for a few years now and 97 00:06:34,320 --> 00:06:38,280 Speaker 2: we have offered up various strategies and it's been challenging 98 00:06:38,360 --> 00:06:41,279 Speaker 2: to watch our clients in the industry that we follow 99 00:06:41,400 --> 00:06:45,960 Speaker 2: so much struggle with this. And so we introduced and 100 00:06:46,000 --> 00:06:48,280 Speaker 2: as we've watched a number of strategies be put out 101 00:06:48,320 --> 00:06:51,560 Speaker 2: into the marketplace, we thought, well, why did they think 102 00:06:51,600 --> 00:06:53,360 Speaker 2: that was the way out of this mess? 103 00:06:53,480 --> 00:06:55,480 Speaker 3: And so we introduced what we would. 104 00:06:55,279 --> 00:06:59,719 Speaker 2: Call a criteria for evaluating strategic options. And we thought 105 00:06:59,720 --> 00:07:02,320 Speaker 2: about what were the things that need to be included 106 00:07:02,480 --> 00:07:06,880 Speaker 2: in an option to give you a confidence that was 107 00:07:06,920 --> 00:07:11,720 Speaker 2: going to set you up for success. And we break 108 00:07:11,720 --> 00:07:15,240 Speaker 2: it down into five things and we have there's a 109 00:07:15,280 --> 00:07:17,800 Speaker 2: combination of financial and strategic. 110 00:07:18,240 --> 00:07:19,640 Speaker 3: So we certainly want. 111 00:07:19,480 --> 00:07:23,679 Speaker 2: To have our clients selecting options that are financially smart, 112 00:07:23,720 --> 00:07:28,720 Speaker 2: so driving revenue growth and improving cash flow and in out. 113 00:07:29,240 --> 00:07:32,320 Speaker 3: But the next part is more strategic. 114 00:07:32,560 --> 00:07:35,760 Speaker 2: We want them to be entering fast growth markets rather 115 00:07:35,840 --> 00:07:43,040 Speaker 2: than trying to simply optimize inside of a slowing or declining. 116 00:07:44,160 --> 00:07:44,640 Speaker 3: Market. 117 00:07:44,880 --> 00:07:47,520 Speaker 2: The fourth is we call strategic. We want them to 118 00:07:47,520 --> 00:07:51,119 Speaker 2: add strategic resilience. And this is what we think about 119 00:07:51,200 --> 00:07:56,000 Speaker 2: easily most easily expresses diversification. To simply be a pure 120 00:07:56,040 --> 00:08:00,000 Speaker 2: play media company is really difficult in these challenge spaces. 121 00:07:59,800 --> 00:08:02,760 Speaker 2: Adding different revenue streams to your model allows you to 122 00:08:02,800 --> 00:08:07,160 Speaker 2: have greater wherewithal, It allows you to weather challenging times, 123 00:08:07,600 --> 00:08:10,880 Speaker 2: and we'll talk about certain models which allow you to 124 00:08:10,920 --> 00:08:14,320 Speaker 2: have more ways to monetize your customers. The last thing 125 00:08:14,440 --> 00:08:16,880 Speaker 2: is we'd love to see options where people are what 126 00:08:16,920 --> 00:08:22,040 Speaker 2: we call accelerating future forward capabilities. We see through our 127 00:08:22,640 --> 00:08:27,160 Speaker 2: reinvent for Growth consumer survey where consumers are going. They're 128 00:08:27,200 --> 00:08:30,840 Speaker 2: going to different places. They're going to sports betting, they're. 129 00:08:30,600 --> 00:08:33,719 Speaker 4: Going to social and video and social media, they are 130 00:08:33,720 --> 00:08:38,160 Speaker 4: going to video games, current legacy media companies don't have 131 00:08:38,360 --> 00:08:41,000 Speaker 4: the capabilities to compete in those spaces. 132 00:08:41,040 --> 00:08:43,959 Speaker 3: They just aren't in those space. They don't have those capabilities. 133 00:08:44,000 --> 00:08:47,560 Speaker 2: They're incredible storytellers that make the world's best content, but 134 00:08:47,640 --> 00:08:51,920 Speaker 2: they don't operate platforms, they don't build video games. 135 00:08:52,360 --> 00:08:53,640 Speaker 3: These are spaces where we. 136 00:08:53,600 --> 00:08:57,280 Speaker 2: Want to see moves and options taken that add those 137 00:08:57,320 --> 00:08:58,800 Speaker 2: future forward capabilities. 138 00:08:59,320 --> 00:09:02,319 Speaker 3: So this media Thrive Index is a way. 139 00:09:02,160 --> 00:09:06,320 Speaker 2: Of assessing the extent to which any strategic option sets 140 00:09:06,360 --> 00:09:09,679 Speaker 2: you up on those five categories in order. 141 00:09:09,559 --> 00:09:14,120 Speaker 1: To thrive well. Obviously easier said than done. And I 142 00:09:14,120 --> 00:09:18,199 Speaker 1: guess I just wonder in your position at Accenture and 143 00:09:18,280 --> 00:09:21,520 Speaker 1: you've gotten obviously you're not going to talk specifics about 144 00:09:21,559 --> 00:09:25,520 Speaker 1: your clients, but I just wonder you're in a boardroom 145 00:09:25,600 --> 00:09:29,560 Speaker 1: with you know, a big conglomerate, a big tech company 146 00:09:29,800 --> 00:09:33,920 Speaker 1: or whatnot, and you're talking to them about this. I 147 00:09:34,040 --> 00:09:38,199 Speaker 1: just wonder what these conversations must be like in the boardroom, 148 00:09:39,360 --> 00:09:43,360 Speaker 1: what the tenor of these conversations are like. Is it 149 00:09:43,520 --> 00:09:47,319 Speaker 1: easy for them to absorb this kind of advice? Do 150 00:09:47,440 --> 00:09:51,760 Speaker 1: they get frustrated? I would imagine these aren't easy conversations. 151 00:09:52,000 --> 00:09:56,640 Speaker 2: You're right, reinvention is hard, and that can be for 152 00:09:56,720 --> 00:10:01,280 Speaker 2: several reasons. First, the first reason might be succes. Having 153 00:10:01,320 --> 00:10:05,400 Speaker 2: success lowers urgency to do a big time transformation. 154 00:10:05,559 --> 00:10:06,800 Speaker 3: And that's why in. 155 00:10:06,760 --> 00:10:10,600 Speaker 2: Our report we harken back to Andy Grove who said 156 00:10:10,640 --> 00:10:14,400 Speaker 2: that only the paranoids survive. In our case, we're saying 157 00:10:14,400 --> 00:10:16,920 Speaker 2: only the radicals survive. But the second reason might be 158 00:10:16,920 --> 00:10:21,560 Speaker 2: the opposite of success. Struggling financially leaves you with limited 159 00:10:22,000 --> 00:10:26,440 Speaker 2: financial wherewithal to execute something truly bold, and that's why 160 00:10:26,480 --> 00:10:28,680 Speaker 2: you're seeing today a lot of what we might call 161 00:10:29,000 --> 00:10:34,800 Speaker 2: incrementalist type options, tweaking the model, trying to make small 162 00:10:34,840 --> 00:10:38,920 Speaker 2: improvements here. There. The third and fourth reasons are probably 163 00:10:39,000 --> 00:10:44,079 Speaker 2: the most important ones. First, reinvention can seem daunting, and 164 00:10:44,520 --> 00:10:47,680 Speaker 2: our clients may not have a culture that rewards bold 165 00:10:47,760 --> 00:10:52,080 Speaker 2: ideas and risk taking. And these are companies who have 166 00:10:52,240 --> 00:10:55,200 Speaker 2: been proceeding in a particular way for a long time, 167 00:10:55,280 --> 00:10:58,319 Speaker 2: many of them celebrating just recently their one hundredth anniversary 168 00:10:58,400 --> 00:11:02,840 Speaker 2: or more. Ways of working and there are you know, 169 00:11:03,360 --> 00:11:08,200 Speaker 2: you know, risk and is often something that people are 170 00:11:08,240 --> 00:11:09,040 Speaker 2: afraid to do. 171 00:11:09,440 --> 00:11:11,840 Speaker 3: The last one, and this is really interesting. 172 00:11:11,880 --> 00:11:14,480 Speaker 2: This goes across we see as we're doing reinvention at 173 00:11:14,520 --> 00:11:17,800 Speaker 2: accenture across many, many industries. This is one of the 174 00:11:17,800 --> 00:11:21,000 Speaker 2: most important ones, which is that the path forward, the 175 00:11:21,040 --> 00:11:24,600 Speaker 2: new way of working, the new business idea, they aren't 176 00:11:24,640 --> 00:11:28,520 Speaker 2: always easily spotted inside of an industry, and if you've 177 00:11:28,520 --> 00:11:30,920 Speaker 2: always been in that industry, you're going to look inside 178 00:11:30,920 --> 00:11:35,040 Speaker 2: your industry for tweaking the things in that industry. Whereas 179 00:11:35,360 --> 00:11:39,559 Speaker 2: what's really been fascinating as we're seeing people from outside 180 00:11:39,600 --> 00:11:43,679 Speaker 2: the industry come in and really inject bold opinions into it. 181 00:11:44,040 --> 00:11:46,760 Speaker 2: And it's really for this reason, Andy, that we had 182 00:11:46,760 --> 00:11:51,040 Speaker 2: to really to help our clients reinvent themselves. Eccentri had 183 00:11:51,040 --> 00:11:55,240 Speaker 2: to reinvent how our clients formulate new business strategies. We 184 00:11:55,400 --> 00:11:57,800 Speaker 2: just had to take a classic a totally different way 185 00:11:57,880 --> 00:12:00,880 Speaker 2: than the classic. You probably are familiar with the old model. 186 00:12:01,160 --> 00:12:03,440 Speaker 2: I come from it, actually, which is you assemble some 187 00:12:03,559 --> 00:12:06,360 Speaker 2: MBAs in a conference room, you inject that with some 188 00:12:06,480 --> 00:12:10,600 Speaker 2: industry experience, you do some analysis, and you find good 189 00:12:10,640 --> 00:12:14,360 Speaker 2: strategies that are looking good in PowerPoint and on Excel. 190 00:12:15,480 --> 00:12:18,439 Speaker 2: I can make fun of that because I'm an old 191 00:12:19,360 --> 00:12:23,040 Speaker 2: strategy consultant who worked Disney for many years. But at Accenture, 192 00:12:23,040 --> 00:12:25,040 Speaker 2: We've tried to reformulate that, and I'll give it to 193 00:12:25,080 --> 00:12:29,920 Speaker 2: you in a couple of ways. First, we bring multidimensional teams. 194 00:12:30,160 --> 00:12:34,520 Speaker 2: Yes we have those MBAs and industry expertise, but we've 195 00:12:34,559 --> 00:12:39,120 Speaker 2: paired them with futurists, with data scientists, with some. 196 00:12:39,000 --> 00:12:40,760 Speaker 3: Of the most creative people in the world, like. 197 00:12:40,760 --> 00:12:46,920 Speaker 2: David Drogas our Song agency with and then deep technologists. 198 00:12:46,920 --> 00:12:49,720 Speaker 2: And when you gather those people around a room, that's 199 00:12:49,760 --> 00:12:52,760 Speaker 2: when you get new and fresh thinking. The second thing 200 00:12:52,800 --> 00:12:56,200 Speaker 2: is we ignore industry and we focus on humans. And 201 00:12:56,800 --> 00:12:59,400 Speaker 2: I'll give you a really good example. When you focus 202 00:12:59,440 --> 00:13:02,360 Speaker 2: on what clients want, you are not thinking about what 203 00:13:02,520 --> 00:13:05,880 Speaker 2: industry you are in. We recently had a newspaper company 204 00:13:06,360 --> 00:13:08,400 Speaker 2: come to us in their view at the beginning of 205 00:13:08,480 --> 00:13:11,360 Speaker 2: the exercises that they are in the newspaper venist business, 206 00:13:11,360 --> 00:13:14,880 Speaker 2: competing against the New York Times. Through our approach, they 207 00:13:14,920 --> 00:13:18,080 Speaker 2: came to think of themselves instead in the attention and 208 00:13:18,280 --> 00:13:22,720 Speaker 2: time spent business. And when they did that, they started 209 00:13:22,720 --> 00:13:26,760 Speaker 2: shifting how they thought about themselves and instead thought themselves 210 00:13:26,800 --> 00:13:27,760 Speaker 2: more broadly. 211 00:13:27,400 --> 00:13:28,479 Speaker 3: Than just a newspaper. 212 00:13:28,840 --> 00:13:31,480 Speaker 2: And frankly, one of the greatest examples that we have 213 00:13:31,600 --> 00:13:33,880 Speaker 2: of that is the New York Times, who themselves are 214 00:13:33,880 --> 00:13:36,800 Speaker 2: a prime example of how someone can reincvent themselves and 215 00:13:37,200 --> 00:13:39,120 Speaker 2: not simply think of themselves. 216 00:13:38,600 --> 00:13:40,720 Speaker 3: As a newspaper business. 217 00:13:40,760 --> 00:13:42,480 Speaker 2: The next thing I want to get at, which is 218 00:13:42,520 --> 00:13:44,959 Speaker 2: really interesting, is we now help our clients think about 219 00:13:45,120 --> 00:13:46,920 Speaker 2: adaptive strategies. 220 00:13:47,320 --> 00:13:50,080 Speaker 3: We build a range of versions of the future. We 221 00:13:50,160 --> 00:13:53,600 Speaker 3: then work backwards and figure out for each of those futures, 222 00:13:53,600 --> 00:13:54,720 Speaker 3: what's the right strategy. 223 00:13:55,040 --> 00:13:57,240 Speaker 2: You don't know which future is going to come to pass, 224 00:13:57,280 --> 00:13:59,760 Speaker 2: So we help our clients place bets in each of 225 00:13:59,760 --> 00:14:03,160 Speaker 2: those futures and they take on a bit of a 226 00:14:03,360 --> 00:14:08,880 Speaker 2: more experimental path. And in fact we recently and to 227 00:14:08,960 --> 00:14:11,120 Speaker 2: do that, you have to create an environment where people 228 00:14:11,120 --> 00:14:14,160 Speaker 2: can be thinking creatively and they have to feel like 229 00:14:14,200 --> 00:14:16,160 Speaker 2: they can take some risks. And if you just do 230 00:14:16,320 --> 00:14:20,680 Speaker 2: this exercise down the hall in the conference room, it's 231 00:14:20,760 --> 00:14:24,240 Speaker 2: just not going to inject that level of free thinking. Recently, 232 00:14:24,320 --> 00:14:27,160 Speaker 2: we brought the CTO of a major theme park division 233 00:14:27,200 --> 00:14:31,320 Speaker 2: and our leadership team to a virtual production studio by 234 00:14:31,560 --> 00:14:36,480 Speaker 2: View Technologies. We were able to completely reinvent the space 235 00:14:36,560 --> 00:14:39,160 Speaker 2: they're in. We could change it as we were changing topics. 236 00:14:39,440 --> 00:14:42,240 Speaker 2: It made a more immersive and visual environment and unlock 237 00:14:42,320 --> 00:14:44,960 Speaker 2: creative thinking. But here's the last bit, which I think 238 00:14:45,000 --> 00:14:49,680 Speaker 2: is really important, is we help our clients put an 239 00:14:49,680 --> 00:14:53,960 Speaker 2: emphasis on culture and it's reinventions out a one time, 240 00:14:54,200 --> 00:14:57,480 Speaker 2: set it, forget it thing. So we create an environment 241 00:14:57,480 --> 00:15:01,480 Speaker 2: where they're taking bets, making it experiments. We had a 242 00:15:01,560 --> 00:15:03,880 Speaker 2: streaming company come to us and said, we want to 243 00:15:03,880 --> 00:15:08,680 Speaker 2: do much more experimentation, we want to evolve more quickly, 244 00:15:08,720 --> 00:15:11,120 Speaker 2: and so we help them put in a culture of experimentation. 245 00:15:11,840 --> 00:15:15,160 Speaker 2: We've also had clients who you've probably seen want to 246 00:15:15,280 --> 00:15:19,600 Speaker 2: establish innovation partnerships with us to keep experimenting more quickly 247 00:15:19,640 --> 00:15:22,360 Speaker 2: to test out that new technology. So we have these 248 00:15:22,400 --> 00:15:25,720 Speaker 2: things with Walt Disney Studios and ESPN and more recently 249 00:15:25,800 --> 00:15:26,320 Speaker 2: the NFL. 250 00:15:26,880 --> 00:15:29,840 Speaker 1: Well, now, now I'm starting to see how a company 251 00:15:29,960 --> 00:15:32,840 Speaker 1: like The New York Times can suddenly get better known 252 00:15:32,920 --> 00:15:36,080 Speaker 1: for wordal than they can for their coverage of the 253 00:15:36,120 --> 00:15:37,480 Speaker 1: Middle East. 254 00:15:38,360 --> 00:15:38,800 Speaker 3: Possible? 255 00:15:39,080 --> 00:15:43,880 Speaker 1: Weren't they obviously kidding? But look, I so you're I 256 00:15:44,200 --> 00:15:48,960 Speaker 1: now understand how you can sort of bombarded a company 257 00:15:49,560 --> 00:15:56,880 Speaker 1: with all sorts of you know, innovation culture to change minds. 258 00:15:57,280 --> 00:16:01,120 Speaker 1: On the other hand, as someone who knows those how 259 00:16:01,640 --> 00:16:06,760 Speaker 1: Hollywood works, how Madison Avenue works, and I've seen from 260 00:16:06,800 --> 00:16:15,960 Speaker 1: the inside how these companies are run by increasingly older 261 00:16:16,840 --> 00:16:23,280 Speaker 1: white men who are managing quarter to quarter, waiting for 262 00:16:23,360 --> 00:16:29,560 Speaker 1: their stock to vest. That is a very very thick 263 00:16:29,960 --> 00:16:38,640 Speaker 1: layer of what's the right word of recalcitrance to cut through? 264 00:16:39,440 --> 00:16:43,600 Speaker 1: Is there cutting through that? I guess you're saying yes. 265 00:16:44,400 --> 00:16:49,520 Speaker 2: I do believe that these companies are capable of radical thinking. 266 00:16:49,720 --> 00:16:53,000 Speaker 2: There are incredible ideas inside them. Let's think about this 267 00:16:53,120 --> 00:16:57,160 Speaker 2: pivot to streaming was a massive risk and a massive 268 00:16:57,280 --> 00:17:03,080 Speaker 2: change that they undertook with legacy, with leadership who sponsored it. 269 00:17:03,360 --> 00:17:06,439 Speaker 2: Another one to think about is, you know both Paramount 270 00:17:06,680 --> 00:17:12,640 Speaker 2: and Fox got to be and Pluto TV, so they 271 00:17:12,680 --> 00:17:16,679 Speaker 2: were very able. They were capable and prescient enough to 272 00:17:17,040 --> 00:17:19,040 Speaker 2: make these big bets to get into fast. 273 00:17:19,359 --> 00:17:23,520 Speaker 3: So there's reason to believe. But what's challenging right now 274 00:17:23,760 --> 00:17:24,040 Speaker 3: is that. 275 00:17:24,080 --> 00:17:30,639 Speaker 2: The level of change needed is beyond incrementalist and so 276 00:17:31,600 --> 00:17:36,240 Speaker 2: we will I expect that ideas will bubble up inside 277 00:17:36,240 --> 00:17:41,440 Speaker 2: and the urgency that's created by these continued struggling financials 278 00:17:41,560 --> 00:17:45,560 Speaker 2: will inject more risk taking and I look forward to it, 279 00:17:45,600 --> 00:17:47,840 Speaker 2: and I think these companies can do it well. 280 00:17:47,920 --> 00:17:50,720 Speaker 1: When we come back, we will talk more with John 281 00:17:50,800 --> 00:17:54,120 Speaker 1: Peters about some of the companies that he's just mentioned, 282 00:17:54,280 --> 00:17:58,760 Speaker 1: like Paramount and Disney, about what they can do to radicalize. 283 00:17:58,960 --> 00:18:08,080 Speaker 1: We'll be back in just a moment, and we are 284 00:18:08,119 --> 00:18:12,480 Speaker 1: back with John Peters of Eccentric, who has created the 285 00:18:12,720 --> 00:18:17,239 Speaker 1: Thrive Media Index, helping companies get radical about how they 286 00:18:17,280 --> 00:18:21,320 Speaker 1: can change their fortunes in the future. John, no doubt 287 00:18:21,320 --> 00:18:25,240 Speaker 1: you're looking at what's going on right now at Paramount, 288 00:18:25,320 --> 00:18:30,120 Speaker 1: where Sharry Redstone certainly has a big decision to make 289 00:18:31,119 --> 00:18:34,040 Speaker 1: with regard to what is she going to do with 290 00:18:34,119 --> 00:18:38,920 Speaker 1: regard to the future of that company on the M 291 00:18:39,000 --> 00:18:42,840 Speaker 1: and A front. I'm curious if you were counseling her 292 00:18:43,359 --> 00:18:47,840 Speaker 1: and you're applying your Thrive Media Index and strategic options, 293 00:18:47,960 --> 00:18:49,200 Speaker 1: what do you think she should do? 294 00:18:49,440 --> 00:18:52,240 Speaker 2: Well, I'll revert back to the media Thrive Index just 295 00:18:52,280 --> 00:18:54,919 Speaker 2: to kind of give us some guideposts. The first is 296 00:18:55,440 --> 00:18:59,280 Speaker 2: we're thinking about this not simply financially. That's a really 297 00:18:59,320 --> 00:19:03,840 Speaker 2: important price interior there's you know, is this again, does 298 00:19:03,920 --> 00:19:07,760 Speaker 2: this option set her up for revenue growth? Not totally sure, 299 00:19:07,840 --> 00:19:11,240 Speaker 2: but maybe the combined companies may have some scale. It 300 00:19:11,359 --> 00:19:16,719 Speaker 2: absolutely should improve cash flow and IBBITA as let's say 301 00:19:17,040 --> 00:19:20,720 Speaker 2: one of the combined entities has more scale. The challenge 302 00:19:20,800 --> 00:19:23,320 Speaker 2: might be the strategic side of these deals, and this 303 00:19:23,400 --> 00:19:26,120 Speaker 2: might be true for all M and A that we've 304 00:19:26,160 --> 00:19:31,359 Speaker 2: been hearing about over the last six months. These aren't 305 00:19:31,359 --> 00:19:36,160 Speaker 2: necessarily getting them into faster growth markets. It's really someone 306 00:19:36,200 --> 00:19:40,920 Speaker 2: who's in a particular market that might be struggling, and 307 00:19:41,000 --> 00:19:46,080 Speaker 2: they're just banding together. But they aren't necessarily putting themselves 308 00:19:46,080 --> 00:19:51,840 Speaker 2: into spaces that are going to now go faster. For example, 309 00:19:52,119 --> 00:19:54,879 Speaker 2: M and A inside of just film and television and 310 00:19:54,920 --> 00:19:57,919 Speaker 2: bringing together broadcast options, just as two people in a 311 00:19:57,920 --> 00:20:02,439 Speaker 2: bigger lifeboat that's still heading towards a waterfall. And so 312 00:20:03,080 --> 00:20:05,280 Speaker 2: I think that, you know, we'd like to see them 313 00:20:05,600 --> 00:20:09,720 Speaker 2: doing deals that enter fast growth markets, add that strategic 314 00:20:09,760 --> 00:20:13,120 Speaker 2: resilience I was describing, and actually bolster them with more 315 00:20:13,160 --> 00:20:14,800 Speaker 2: future capability. 316 00:20:14,880 --> 00:20:18,880 Speaker 3: So if someone told me that instead they were going to. 317 00:20:18,800 --> 00:20:25,160 Speaker 2: Buy someone who had much more advanced ad targeting technology, okay, right, 318 00:20:25,200 --> 00:20:28,960 Speaker 2: so that adds perhaps some future forward capabilities. If they 319 00:20:29,000 --> 00:20:33,040 Speaker 2: said we were going to get into the social video space, 320 00:20:33,320 --> 00:20:36,160 Speaker 2: all right, now you're moving into a fast growth market, 321 00:20:37,000 --> 00:20:40,080 Speaker 2: or if they said well, we're going to add we're 322 00:20:40,080 --> 00:20:42,840 Speaker 2: going to partner with someone who has a deep retail 323 00:20:42,920 --> 00:20:46,520 Speaker 2: media network, and we are going to have a greater 324 00:20:46,680 --> 00:20:51,240 Speaker 2: e commerce part of our business. Okay, you're adding strategic resilience. 325 00:20:51,680 --> 00:20:55,879 Speaker 2: I get nervous about this sort of intra industry m 326 00:20:55,960 --> 00:20:59,680 Speaker 2: and A when it doesn't It might improve cash flow 327 00:21:00,680 --> 00:21:03,960 Speaker 2: and near term give it up, but I don't know 328 00:21:04,040 --> 00:21:06,439 Speaker 2: that it gives you any of the strategic benefits, and 329 00:21:06,480 --> 00:21:10,560 Speaker 2: it probably doesn't necessarily give you substantial revenue growth. 330 00:21:11,119 --> 00:21:16,480 Speaker 1: And I wonder if perhaps a better example of a 331 00:21:16,640 --> 00:21:19,560 Speaker 1: move on the M and A front might be what 332 00:21:20,119 --> 00:21:23,000 Speaker 1: your old employer, Disney is doing in terms of their 333 00:21:23,040 --> 00:21:25,320 Speaker 1: strategic investment in Epic. 334 00:21:25,600 --> 00:21:28,720 Speaker 2: So that's a really interesting one, right, So that now 335 00:21:28,760 --> 00:21:30,280 Speaker 2: we're talking about something. 336 00:21:30,040 --> 00:21:31,919 Speaker 3: That aligns with where. 337 00:21:33,200 --> 00:21:36,679 Speaker 2: Where consumers are going spending more time in video games, 338 00:21:37,320 --> 00:21:41,600 Speaker 2: and it gives them exposure to the capabilities necessary and 339 00:21:41,640 --> 00:21:44,880 Speaker 2: so it could be adding into that future forward capabilities. 340 00:21:45,080 --> 00:21:48,840 Speaker 2: So there is something that's attractive about moves of that sort. 341 00:21:49,440 --> 00:21:53,560 Speaker 2: And when we did our fifty plus options and analyze them. 342 00:21:54,840 --> 00:21:57,080 Speaker 3: There were instances. One of them was. 343 00:21:57,240 --> 00:22:00,800 Speaker 2: Merging with a video game studio or can considering video 344 00:22:00,880 --> 00:22:05,600 Speaker 2: game platforms. These are spaces where these legacy companies get 345 00:22:05,640 --> 00:22:09,359 Speaker 2: to latch onto that fast growth and latch on to 346 00:22:09,400 --> 00:22:12,879 Speaker 2: where consumers are going instead of trying to toil simply 347 00:22:12,960 --> 00:22:15,160 Speaker 2: where they are leaving today. 348 00:22:15,320 --> 00:22:19,400 Speaker 1: And what's your take on cons on consolidation in general 349 00:22:20,720 --> 00:22:25,159 Speaker 1: an inevitability is it and its adaptability or is it 350 00:22:25,200 --> 00:22:26,960 Speaker 1: sort of a throw in the towel move. 351 00:22:27,359 --> 00:22:31,040 Speaker 2: Well, again, if it's just for cost and scale, I'm 352 00:22:31,080 --> 00:22:33,480 Speaker 2: not sure if it's a great play, and it probably 353 00:22:33,560 --> 00:22:36,800 Speaker 2: doesn't solve a lot of the endemic issues in the industry. 354 00:22:37,280 --> 00:22:41,920 Speaker 2: If it's to obtain unique capabilities like advertising technology, or 355 00:22:41,920 --> 00:22:46,119 Speaker 2: really if there is a streaming platform that had much 356 00:22:46,160 --> 00:22:50,760 Speaker 2: more ability to monetize consumers, or you know there is. 357 00:22:50,880 --> 00:22:55,320 Speaker 2: We found through our survey extensive interest among our consumers 358 00:22:55,320 --> 00:23:00,400 Speaker 2: in a single app that provides both their music, their videos, 359 00:23:00,440 --> 00:23:04,880 Speaker 2: and other services and lifestyle bundles in general is something 360 00:23:04,920 --> 00:23:06,160 Speaker 2: consumers are very interesting. 361 00:23:06,640 --> 00:23:11,359 Speaker 3: That type of consolidation could be interesting. If someone said 362 00:23:11,440 --> 00:23:13,840 Speaker 3: this is a stepping stone to. 363 00:23:13,920 --> 00:23:17,320 Speaker 2: Free up cash flow to reinvent and be humble, we 364 00:23:17,440 --> 00:23:19,199 Speaker 2: would be absolutely supportive of that. 365 00:23:19,520 --> 00:23:22,840 Speaker 1: Well, you're talking about bundling. We're certainly seeing a lot 366 00:23:22,880 --> 00:23:27,600 Speaker 1: of momentum on that front in recent weeks, and pretty 367 00:23:27,640 --> 00:23:32,720 Speaker 1: bold moves with Disney and Warner, a sports bundle with 368 00:23:32,800 --> 00:23:37,879 Speaker 1: Disney and Fox and others, Netflix and Comcast making some 369 00:23:38,040 --> 00:23:43,480 Speaker 1: moves after a lot of anticipation, a sudden rash of moves. 370 00:23:44,920 --> 00:23:52,280 Speaker 1: What's your take here, because certainly bundling has its advantages, 371 00:23:52,320 --> 00:23:55,320 Speaker 1: but it's also not quite what you were just describing 372 00:23:55,359 --> 00:23:58,760 Speaker 1: earlier in terms of what I would call a lifestyle bundle. 373 00:23:58,920 --> 00:23:59,360 Speaker 3: That's right. 374 00:23:59,680 --> 00:24:04,160 Speaker 2: So we are seeing multi service bundles in media, we're 375 00:24:04,200 --> 00:24:11,680 Speaker 2: seeing sports bundles. Those are we would We actually included 376 00:24:11,720 --> 00:24:14,399 Speaker 2: them as options, So these were while we did our 377 00:24:14,440 --> 00:24:17,200 Speaker 2: analysis before those were announced. These are certainly ideas that 378 00:24:17,480 --> 00:24:19,560 Speaker 2: we had and that others have had, so they were 379 00:24:19,560 --> 00:24:22,320 Speaker 2: part of our analysis, and they're what we would call 380 00:24:22,960 --> 00:24:27,360 Speaker 2: middle or medium levels of reinvention. They give you reasons 381 00:24:27,400 --> 00:24:30,639 Speaker 2: to believe about revenue growth UH, and we think that 382 00:24:30,680 --> 00:24:34,320 Speaker 2: they can. Particularly the sports one has an opportunity to 383 00:24:35,080 --> 00:24:38,159 Speaker 2: UH you know, have limited retention, which drives up a 384 00:24:38,359 --> 00:24:42,800 Speaker 2: long term growth opportunity and longer term enterprise value. 385 00:24:43,560 --> 00:24:43,679 Speaker 1: UH. 386 00:24:44,200 --> 00:24:48,520 Speaker 2: Sports growth. Sports is one of these fast growth markets. 387 00:24:49,080 --> 00:24:51,760 Speaker 2: Does it give them strategic resilience? Does it get them 388 00:24:51,760 --> 00:24:55,720 Speaker 2: into new markets. Does accelerate future forward capabilities? Not sure, 389 00:24:55,800 --> 00:24:58,840 Speaker 2: And that's why we think these are solid moves to 390 00:24:59,400 --> 00:25:05,199 Speaker 2: secure current state businesses, but they aren't reinvention of the 391 00:25:05,240 --> 00:25:08,840 Speaker 2: sort that we really think is necessary for longer term 392 00:25:09,280 --> 00:25:13,840 Speaker 2: survival and thriving. We look for where again, we're watching 393 00:25:13,880 --> 00:25:18,399 Speaker 2: where consumers are going, and we're watching where competitors are going. 394 00:25:18,600 --> 00:25:20,080 Speaker 3: If you look at where. 395 00:25:21,200 --> 00:25:26,359 Speaker 2: The space of say, what Apple offers consumers, what Amazon 396 00:25:26,480 --> 00:25:29,960 Speaker 2: is offering consumers, and when we look internationally or outside 397 00:25:29,960 --> 00:25:32,639 Speaker 2: of media, we see some really exciting examples, even with 398 00:25:32,760 --> 00:25:38,800 Speaker 2: Walmart and Reliance overseas. These are people who are including 399 00:25:38,920 --> 00:25:44,840 Speaker 2: media inside of a multi category bundle, and they're increasingly 400 00:25:46,720 --> 00:25:51,119 Speaker 2: drawing in significant amounts of consumer spend flowing through their businesses. 401 00:25:51,160 --> 00:25:54,920 Speaker 2: So as you think about these spaces, let's just kind 402 00:25:54,920 --> 00:25:59,280 Speaker 2: of if you think about Amazon, they are in streaming ebooks, gaming, 403 00:26:00,440 --> 00:26:04,719 Speaker 2: you know, music, but they're also in groceroots and prescription 404 00:26:04,880 --> 00:26:08,280 Speaker 2: drugs and who knows what's next. And so we think 405 00:26:08,440 --> 00:26:12,000 Speaker 2: bundles that start to move you out of simply being 406 00:26:12,040 --> 00:26:17,199 Speaker 2: in one category provide some strategic resilience getting into a 407 00:26:17,200 --> 00:26:20,560 Speaker 2: bundle that has more of what consumers want, and more 408 00:26:20,600 --> 00:26:23,520 Speaker 2: of their consumer spend actually sets you off. 409 00:26:23,280 --> 00:26:27,000 Speaker 3: In a faster growth model. So look for. 410 00:26:27,440 --> 00:26:30,640 Speaker 2: These companies who are entering the space to be creating 411 00:26:30,800 --> 00:26:35,120 Speaker 2: more expansive bundles, and those may have much broader appeal 412 00:26:35,160 --> 00:26:39,320 Speaker 2: to consumers than simply media bundles that are only within 413 00:26:39,359 --> 00:26:40,159 Speaker 2: the media space. 414 00:26:40,359 --> 00:26:43,040 Speaker 1: I hear you, But I should also note that you know, 415 00:26:43,440 --> 00:26:47,919 Speaker 1: Apple has been in the market for years now with 416 00:26:48,040 --> 00:26:50,919 Speaker 1: a let's call it a lifestyle bud, a bundle, a 417 00:26:51,040 --> 00:26:55,080 Speaker 1: multi category bundle. I believe it's called Apple One that 418 00:26:55,240 --> 00:26:59,240 Speaker 1: I don't believe has really lit the marketplace on fire. 419 00:27:00,240 --> 00:27:03,440 Speaker 1: I haven't seen data anecdotally. I don't think I've ever 420 00:27:03,480 --> 00:27:07,080 Speaker 1: met a human being who has used it. I think 421 00:27:07,119 --> 00:27:10,440 Speaker 1: Amazon is probably in a better position in terms of 422 00:27:11,680 --> 00:27:18,760 Speaker 1: bringing disparate categories together, but maybe hasn't even fully realized that. 423 00:27:19,920 --> 00:27:22,560 Speaker 1: But on top of you and all of that, I 424 00:27:22,720 --> 00:27:25,600 Speaker 1: just wonder where it's like, if you're not one of 425 00:27:25,640 --> 00:27:30,120 Speaker 1: the big tech companies in position to bring it all together, 426 00:27:30,480 --> 00:27:32,760 Speaker 1: should you just lay down and die and wait to 427 00:27:32,880 --> 00:27:35,680 Speaker 1: be acquired? Like, what is the strategy? 428 00:27:35,920 --> 00:27:39,679 Speaker 2: Well, certainly Paramount has seen this as a great opportunity 429 00:27:39,680 --> 00:27:44,400 Speaker 2: for them to get Walmart's bundle to drive subs to them. 430 00:27:44,520 --> 00:27:46,440 Speaker 2: I think that it was a wise move for them. 431 00:27:46,840 --> 00:27:51,640 Speaker 2: And you know when we actually during our Reinvent survey 432 00:27:52,040 --> 00:27:54,520 Speaker 2: of six thousand consumers, we ask them who would you 433 00:27:54,560 --> 00:27:57,119 Speaker 2: be interested in getting these bundles from? 434 00:27:57,640 --> 00:27:57,960 Speaker 4: Media? 435 00:27:58,040 --> 00:28:02,360 Speaker 2: Companies are still on the list. In fact, well Disney 436 00:28:02,520 --> 00:28:05,840 Speaker 2: was in the top five. So it's not a game 437 00:28:05,920 --> 00:28:10,480 Speaker 2: over simply for big tech companies. They certainly are showing 438 00:28:10,520 --> 00:28:13,640 Speaker 2: a willingness to get in more markets more quickly than 439 00:28:13,760 --> 00:28:14,600 Speaker 2: media companies. 440 00:28:14,880 --> 00:28:18,919 Speaker 3: But part of our request of our clients to get 441 00:28:18,960 --> 00:28:22,600 Speaker 3: bold in this space is to consider everything that they 442 00:28:22,640 --> 00:28:27,440 Speaker 3: can represent to consumers. Consumers are very interested in bundles 443 00:28:27,480 --> 00:28:30,640 Speaker 3: that go outside of media, and I just i'll give 444 00:28:30,680 --> 00:28:33,040 Speaker 3: you a sense. We surveyed which categories are interested. 445 00:28:33,080 --> 00:28:37,800 Speaker 2: I've already said food delivery, grocery delivery top top two, 446 00:28:38,760 --> 00:28:43,600 Speaker 2: music number three, but then it goes to travel, financial services, 447 00:28:43,720 --> 00:28:46,400 Speaker 2: health and wellness. There's no reason that those are off 448 00:28:46,440 --> 00:28:49,440 Speaker 2: the table for media companies. It's if you remember, our 449 00:28:49,480 --> 00:28:52,840 Speaker 2: point was new ways of thinking about strategy are not 450 00:28:53,920 --> 00:28:57,800 Speaker 2: start with ignoring industry and focusing on what humans want. 451 00:28:58,200 --> 00:29:01,560 Speaker 2: And when you do that, you can reinvent yourself to 452 00:29:01,600 --> 00:29:04,920 Speaker 2: offer all of those things I just mentioned. Now, it 453 00:29:05,040 --> 00:29:08,440 Speaker 2: may be that people haven't been hearing those things. Is 454 00:29:08,520 --> 00:29:13,560 Speaker 2: traditionally associated with media companies, but I'd encourage them to 455 00:29:13,600 --> 00:29:17,520 Speaker 2: be expansive in their thinking and frankly, this podcast, if 456 00:29:17,520 --> 00:29:20,000 Speaker 2: you look at what you have been introducing them to 457 00:29:20,160 --> 00:29:23,480 Speaker 2: over the last several years, it's been on pushing their thinking, 458 00:29:24,120 --> 00:29:28,239 Speaker 2: exposing them to want pad, exposing them to nebula and 459 00:29:28,320 --> 00:29:31,760 Speaker 2: people who are reinventing models. That's what we need to 460 00:29:31,840 --> 00:29:36,040 Speaker 2: expose people to because there are successes happening, and these 461 00:29:36,080 --> 00:29:39,479 Speaker 2: two can happen for traditional media companies if they elect 462 00:29:39,520 --> 00:29:41,720 Speaker 2: to undertake that bold change. 463 00:29:41,800 --> 00:29:44,800 Speaker 1: Well, thank you for being a listener to this podcast. 464 00:29:44,840 --> 00:29:48,400 Speaker 1: But you know it's as we close out the conversation here, 465 00:29:48,440 --> 00:29:52,200 Speaker 1: what I'd be remiss in not asking you about is well, 466 00:29:52,400 --> 00:29:54,560 Speaker 1: let me put it this way. If I could draw 467 00:29:54,840 --> 00:29:59,120 Speaker 1: a political cartoon for this conversation, I would picture you 468 00:29:59,160 --> 00:30:04,960 Speaker 1: and I sort of standing on a landscape, a storm 469 00:30:05,080 --> 00:30:11,640 Speaker 1: tossed landscape, talking about, you know, rehabilitating the landscape and 470 00:30:11,760 --> 00:30:14,880 Speaker 1: talking about how we're going to fix it. But in 471 00:30:14,920 --> 00:30:20,360 Speaker 1: the background, there is a tsunami way about hit in 472 00:30:21,680 --> 00:30:26,840 Speaker 1: back of us. And the tsunami is marked AI, you know, 473 00:30:27,280 --> 00:30:30,880 Speaker 1: meaning like, great, we're about to fix everything, but here's 474 00:30:30,920 --> 00:30:33,320 Speaker 1: this other way about to come that's about to rip 475 00:30:33,400 --> 00:30:37,040 Speaker 1: up the landscape all over again. Well and I guess, well, 476 00:30:37,440 --> 00:30:42,400 Speaker 1: does that premise even strike you as accurate or maybe 477 00:30:42,440 --> 00:30:47,000 Speaker 1: I'm overstating it. Give me your take on what AI 478 00:30:47,440 --> 00:30:53,040 Speaker 1: means for this landscape. Is it quite the tsunami I'm 479 00:30:53,040 --> 00:30:56,160 Speaker 1: making it out to be. What's your sense of it? 480 00:30:56,560 --> 00:31:00,239 Speaker 2: Well, so, you know, as you can imagine accenture our 481 00:31:00,280 --> 00:31:05,480 Speaker 2: core being, you know, a helping our clients leverage technology 482 00:31:05,520 --> 00:31:10,160 Speaker 2: to reinvent themselves. We are very engaged in this AI 483 00:31:10,280 --> 00:31:14,600 Speaker 2: topic with media companies, and it's true that there is 484 00:31:14,640 --> 00:31:17,920 Speaker 2: an extent to which it will be extraordinarily disruptive to 485 00:31:17,960 --> 00:31:21,280 Speaker 2: the way things are done today. And a lot of 486 00:31:21,280 --> 00:31:25,960 Speaker 2: the initial focus was certainly on, you know, cost reduction, 487 00:31:26,400 --> 00:31:31,360 Speaker 2: the opportunity to reduce cost, and that's created, you know, rightfully, 488 00:31:31,480 --> 00:31:35,120 Speaker 2: concern around what this will mean for jobs in this industry. 489 00:31:37,560 --> 00:31:42,080 Speaker 2: What we're now seeing is, first the tsunami may actually 490 00:31:42,120 --> 00:31:47,400 Speaker 2: come with surfboards in the sense that there's great opportunity 491 00:31:47,520 --> 00:31:51,520 Speaker 2: for there to be more jobs created as this drives 492 00:31:51,760 --> 00:31:57,640 Speaker 2: growth and revenue. So AI could be this great creator 493 00:31:57,760 --> 00:32:04,280 Speaker 2: tool set that enables more creation and absolutely, while we 494 00:32:04,320 --> 00:32:08,480 Speaker 2: will see that certain aspects of jobs might be handed 495 00:32:08,520 --> 00:32:13,800 Speaker 2: over to AI, we'll probably see that that actually allows 496 00:32:13,840 --> 00:32:16,520 Speaker 2: you to create more content for the same amount of money. 497 00:32:17,480 --> 00:32:18,200 Speaker 3: Consumers. 498 00:32:18,320 --> 00:32:21,680 Speaker 2: The battle will always still be about having terrific content 499 00:32:22,000 --> 00:32:26,920 Speaker 2: or having an easy to use platform and easily navigate it. 500 00:32:27,040 --> 00:32:32,000 Speaker 2: Those things will be enabled by AI, But I think 501 00:32:32,040 --> 00:32:34,720 Speaker 2: the revenue side is the space that we get most 502 00:32:34,720 --> 00:32:37,080 Speaker 2: excited about we're seeing our clients do. Then I'll just 503 00:32:37,120 --> 00:32:39,560 Speaker 2: give you a couple of different examples. Certainly in the 504 00:32:39,600 --> 00:32:48,400 Speaker 2: world of advertising, the ability to more easily generate ads, 505 00:32:48,600 --> 00:32:53,080 Speaker 2: create ads that are personalized to consumers that fit with 506 00:32:53,120 --> 00:32:56,120 Speaker 2: what they actually would like to see ads about that 507 00:32:56,160 --> 00:32:59,560 Speaker 2: can drive greater revenue for media companies and their ability 508 00:32:59,600 --> 00:33:03,720 Speaker 2: to have more compelling ads better targeted at We're also 509 00:33:03,760 --> 00:33:08,800 Speaker 2: seeing that there's certain media spaces where consumers would love 510 00:33:08,880 --> 00:33:13,240 Speaker 2: to consume more, but it hasn't always been cost effective. 511 00:33:13,200 --> 00:33:15,640 Speaker 3: To actually create that content. 512 00:33:15,720 --> 00:33:20,960 Speaker 2: We've got a sports broadcasting company who does a lot 513 00:33:21,000 --> 00:33:24,959 Speaker 2: of news, and they have lots of websites that they 514 00:33:25,000 --> 00:33:28,000 Speaker 2: create with news stories. It doesn't always make sense to 515 00:33:28,000 --> 00:33:32,480 Speaker 2: send a reporter to every game, but instead, now using AI, 516 00:33:32,600 --> 00:33:37,280 Speaker 2: we can review transcripts and we can review the stats 517 00:33:37,280 --> 00:33:39,560 Speaker 2: to create stories. And what is a story on a 518 00:33:39,560 --> 00:33:42,600 Speaker 2: web page? An ad gets served with it every time 519 00:33:42,640 --> 00:33:46,520 Speaker 2: someone clicks. Now, I think what's going to be exciting 520 00:33:46,720 --> 00:33:49,720 Speaker 2: is that the creator economy is where we may see 521 00:33:49,760 --> 00:33:53,040 Speaker 2: some of the earliest disruptive uptake of AI. 522 00:33:53,320 --> 00:33:56,240 Speaker 3: And that's going to be wonderful that. 523 00:33:56,480 --> 00:34:02,400 Speaker 2: These individuals, with the democratization of AI and can see incredible, 524 00:34:02,440 --> 00:34:06,440 Speaker 2: more incredible versions of content. Remember we cited that stat 525 00:34:06,520 --> 00:34:09,200 Speaker 2: early at the show where we said that fifty nine 526 00:34:09,200 --> 00:34:14,440 Speaker 2: percent of people already see ugcs as entertaining as traditional media. 527 00:34:14,640 --> 00:34:17,640 Speaker 2: So that's going to continue to put traditional media companies 528 00:34:17,719 --> 00:34:22,520 Speaker 2: under siege to elevate their game. But with AI, investments 529 00:34:22,520 --> 00:34:26,440 Speaker 2: in capital spending can actually propel the quality of content. 530 00:34:26,640 --> 00:34:29,480 Speaker 2: And I think what we saw over the last decade 531 00:34:29,560 --> 00:34:33,800 Speaker 2: is as traditional media has invested more in special effects 532 00:34:33,800 --> 00:34:37,880 Speaker 2: and incredible film content, they've they continue to capture share 533 00:34:38,120 --> 00:34:41,520 Speaker 2: and want audiences. So I expect that AI will be 534 00:34:41,560 --> 00:34:44,640 Speaker 2: this great propeller of new ways of working. What a 535 00:34:44,760 --> 00:34:47,640 Speaker 2: studio may be ten years from now might be quite different. 536 00:34:47,719 --> 00:34:50,040 Speaker 2: But I don't think that it actually means less jobs. 537 00:34:50,040 --> 00:34:50,919 Speaker 2: I think it means more. 538 00:34:51,280 --> 00:34:58,560 Speaker 1: Well, it's certainly a wonderfully optimistic take on AI. I 539 00:34:58,600 --> 00:35:01,319 Speaker 1: look forward to seeing in the year who will be 540 00:35:02,160 --> 00:35:05,720 Speaker 1: heeding your words for the Thrive Media Index. 541 00:35:05,800 --> 00:35:07,280 Speaker 3: We will see who. 542 00:35:07,080 --> 00:35:10,360 Speaker 1: Will thrive, who will survive, who will take a dive. 543 00:35:11,560 --> 00:35:16,919 Speaker 1: But thank you for sharing your advice and counsel with us, 544 00:35:17,600 --> 00:35:19,840 Speaker 1: and appreciate you coming on the podcast. 545 00:35:20,040 --> 00:35:26,040 Speaker 3: Thank Andy, great to be here, Thanks for listening. 546 00:35:26,520 --> 00:35:29,160 Speaker 2: Be sure to leave us a review at Apple Podcasts 547 00:35:29,160 --> 00:35:33,040 Speaker 2: and Amazon Music. We love to hear from listeners. Please 548 00:35:33,080 --> 00:35:35,400 Speaker 2: go to Variety dot com and sign up for the 549 00:35:35,440 --> 00:35:39,640 Speaker 2: free weekly Strictly Business newsletter, and don't forget to tune 550 00:35:39,680 --> 00:35:43,000 Speaker 2: in next week for another episode of Strictly Business.