1 00:00:08,800 --> 00:00:13,200 Speaker 1: Welcome to Strictly Business, Varieties weekly podcast featuring conversations with 2 00:00:13,240 --> 00:00:16,960 Speaker 1: industry leaders about the business of media and entertainment. I'm 3 00:00:17,000 --> 00:00:20,720 Speaker 1: Cynthia Littleton, co editor in chief of Variety Today. My 4 00:00:20,760 --> 00:00:24,200 Speaker 1: guest is ari A Borkoff, Founder and CEO of Lion Tree. 5 00:00:24,560 --> 00:00:27,840 Speaker 1: Borkoff is the banker to the media elite. He's almost 6 00:00:27,920 --> 00:00:30,360 Speaker 1: always in the middle of the action on big mergers 7 00:00:30,360 --> 00:00:34,000 Speaker 1: and acquisitions. Investors of the caliber of John Malone and 8 00:00:34,040 --> 00:00:38,000 Speaker 1: Shari Redstone have him on speed dial. In our conversation, 9 00:00:38,360 --> 00:00:41,680 Speaker 1: Borkoff talks about the profound effects of the pandemic and 10 00:00:41,720 --> 00:00:44,720 Speaker 1: how it will shape the media and entertainment ecosystem for 11 00:00:44,800 --> 00:00:48,479 Speaker 1: years to come. He gives his insights into the great 12 00:00:48,560 --> 00:00:53,239 Speaker 1: direct to consumer realignment underway for traditional Hollywood giants, and 13 00:00:53,360 --> 00:00:56,040 Speaker 1: he explains why his team at Lion Tree is closely 14 00:00:56,080 --> 00:00:59,720 Speaker 1: watching the video gaming world. Normally, people pay a lot 15 00:00:59,760 --> 00:01:02,840 Speaker 1: of money for a half hour with Aria Borkoff, so 16 00:01:02,960 --> 00:01:05,720 Speaker 1: consider this episode a perk and a good reason to 17 00:01:05,800 --> 00:01:12,800 Speaker 1: listen to Strictly Business all year long. Area Borkoff, founder 18 00:01:12,880 --> 00:01:19,200 Speaker 1: and CEO of Lion Try the elite media investment banking 19 00:01:19,240 --> 00:01:22,679 Speaker 1: an advisory firm. Thank you so much for taking time 20 00:01:22,680 --> 00:01:25,600 Speaker 1: out to join us. Thanks for having me. As we 21 00:01:25,680 --> 00:01:28,399 Speaker 1: look to kick off the new year, what do you 22 00:01:28,440 --> 00:01:32,760 Speaker 1: see what is the most significant things that you see 23 00:01:32,840 --> 00:01:35,360 Speaker 1: on the horizon for media companies to deal with? And 24 00:01:35,440 --> 00:01:38,520 Speaker 1: that is a loaded question because there are about twenty 25 00:01:38,840 --> 00:01:41,280 Speaker 1: thousand things that they have to deal with. But what 26 00:01:41,360 --> 00:01:44,560 Speaker 1: do you think for the media giants that you work 27 00:01:44,640 --> 00:01:47,560 Speaker 1: with and and study, what do you think are the 28 00:01:47,600 --> 00:01:50,960 Speaker 1: biggest issues that are going to need to be addressed 29 00:01:51,040 --> 00:01:55,880 Speaker 1: in Well, obviously a great open ended question to start, 30 00:01:55,920 --> 00:01:59,120 Speaker 1: but it's, like you said, it is uh the question 31 00:01:59,160 --> 00:02:02,000 Speaker 1: that the media cup but he has grappled with every day. 32 00:02:02,040 --> 00:02:05,600 Speaker 1: I always think about public companies and CEOs of public 33 00:02:05,600 --> 00:02:11,440 Speaker 1: companies having to assess what their shareholders are going to 34 00:02:11,639 --> 00:02:15,800 Speaker 1: be interested in UH and be demanding of them UM 35 00:02:15,960 --> 00:02:18,519 Speaker 1: not only at the moment but in the future and 36 00:02:18,639 --> 00:02:21,680 Speaker 1: UH and have to predict that UM and then obviously 37 00:02:21,760 --> 00:02:25,480 Speaker 1: drive the company risk, appetite and investment horizons towards that 38 00:02:25,560 --> 00:02:30,960 Speaker 1: shareholder base, media company strategies and the company executives have 39 00:02:31,120 --> 00:02:33,440 Speaker 1: to do the same thing for their consumers. And so 40 00:02:33,480 --> 00:02:36,160 Speaker 1: the answer to your question is what does the consumer 41 00:02:36,240 --> 00:02:38,919 Speaker 1: look like in the future By the end of twenty one. 42 00:02:39,280 --> 00:02:41,960 Speaker 1: So we're sitting here beginning the year. What does the 43 00:02:42,000 --> 00:02:44,119 Speaker 1: consumer appetite look like at the end of the year, 44 00:02:44,160 --> 00:02:46,480 Speaker 1: and how do you position your company for that? And 45 00:02:46,560 --> 00:02:48,320 Speaker 1: so it very clearly has a lot to do with 46 00:02:48,440 --> 00:02:52,680 Speaker 1: video streaming, and we've been we've been very much binging 47 00:02:52,800 --> 00:02:57,919 Speaker 1: of video content and the creative um explosion of everything 48 00:02:58,480 --> 00:03:02,080 Speaker 1: at the Disney Plus usen HBO Max and Apple TV 49 00:03:02,320 --> 00:03:06,440 Speaker 1: and Discovery Plus and Amazon Prime and and everything around 50 00:03:06,560 --> 00:03:10,040 Speaker 1: the world that we're consuming all the time. But we've 51 00:03:10,040 --> 00:03:13,480 Speaker 1: also been in consuming a lot more audio content like 52 00:03:13,600 --> 00:03:16,400 Speaker 1: this right, and audio has been, in our view of, 53 00:03:16,960 --> 00:03:19,400 Speaker 1: you know, growing a lot faster than even video and 54 00:03:19,440 --> 00:03:23,239 Speaker 1: I think we'll continue to do so. And then there's gaming, um, 55 00:03:23,280 --> 00:03:26,760 Speaker 1: and not not just video games as an activity, but 56 00:03:27,000 --> 00:03:30,320 Speaker 1: video games as a metaverse, as a as a as 57 00:03:30,360 --> 00:03:34,360 Speaker 1: a new universe. So is Fortnite the new Internet. And 58 00:03:34,400 --> 00:03:37,600 Speaker 1: we saw in the last year Travis Scott premier a 59 00:03:37,680 --> 00:03:41,160 Speaker 1: concert within the Fortnite ecosystem. Maybe we'll start seeing movie 60 00:03:41,200 --> 00:03:45,760 Speaker 1: premiers within the Internet of the within the video gaming ecosystem, 61 00:03:45,920 --> 00:03:50,040 Speaker 1: or other concerts or other you know, activities that are 62 00:03:50,040 --> 00:03:53,040 Speaker 1: more virtual. If you actually notice towards the end of 63 00:03:53,120 --> 00:03:56,840 Speaker 1: last year with the pandemic, a lot of advertisements on 64 00:03:56,880 --> 00:04:03,000 Speaker 1: television were, um, we're animated or virtual. So you may 65 00:04:03,120 --> 00:04:06,480 Speaker 1: not even really notice the difference over time that because 66 00:04:06,520 --> 00:04:10,400 Speaker 1: of production issues around the pandemic, you didn't really have 67 00:04:10,640 --> 00:04:14,920 Speaker 1: a chance a chance to see the video in person 68 00:04:15,440 --> 00:04:20,360 Speaker 1: commercials being filmed or produced. So those were replaced by 69 00:04:20,520 --> 00:04:23,520 Speaker 1: you know, C g I or animated commercials and most 70 00:04:23,520 --> 00:04:26,240 Speaker 1: people didn't even notice it, but they were really appealing still. 71 00:04:26,600 --> 00:04:29,320 Speaker 1: So that is a new way of doing things that 72 00:04:29,360 --> 00:04:31,920 Speaker 1: happened right before your eyes. And so I think it's 73 00:04:31,920 --> 00:04:35,400 Speaker 1: really about predicting the future consuming patterns of the of 74 00:04:35,480 --> 00:04:37,920 Speaker 1: the of all of us. And I think position for that. 75 00:04:38,000 --> 00:04:41,799 Speaker 1: And I think savings has picked up a lot during 76 00:04:41,839 --> 00:04:45,039 Speaker 1: this pandemic in because we've all saved a lot of 77 00:04:45,040 --> 00:04:47,080 Speaker 1: money and comming to save a little bit of money 78 00:04:47,080 --> 00:04:50,159 Speaker 1: and we haven't traveled and we're waiting to consume it 79 00:04:50,279 --> 00:04:52,240 Speaker 1: inside the home and outside the home, and that will 80 00:04:52,279 --> 00:04:54,800 Speaker 1: have to be balanced with all of our leisure activities. 81 00:04:55,120 --> 00:04:58,040 Speaker 1: That that could be one silver lining, because you know, 82 00:04:58,080 --> 00:05:02,520 Speaker 1: the general statistics are pretty scary about how little Americans actually, 83 00:05:02,560 --> 00:05:05,640 Speaker 1: you know, actually put in the bank, so so that 84 00:05:05,640 --> 00:05:08,160 Speaker 1: that could you know that there could definitely be some 85 00:05:08,200 --> 00:05:13,240 Speaker 1: silver linings there. Do you think that UM Let me 86 00:05:13,240 --> 00:05:15,039 Speaker 1: ask in terms of in terms of M and A, 87 00:05:15,480 --> 00:05:18,240 Speaker 1: do you think there's been There has been a lot 88 00:05:18,320 --> 00:05:20,760 Speaker 1: of activity, but there's also been a feeling that there 89 00:05:20,920 --> 00:05:23,880 Speaker 1: is a there's a great roll up waiting to happen 90 00:05:24,360 --> 00:05:27,599 Speaker 1: with some smaller companies, whether they're active in cable or 91 00:05:27,640 --> 00:05:32,320 Speaker 1: active in content. Do you think that the pandemic conditions 92 00:05:32,760 --> 00:05:36,680 Speaker 1: have made another wave of media M and A more 93 00:05:36,800 --> 00:05:40,440 Speaker 1: likely or less likely in this coming say twelve to 94 00:05:40,560 --> 00:05:43,360 Speaker 1: twenty four months. I wouldn't draw a parallel between the 95 00:05:43,360 --> 00:05:46,160 Speaker 1: pandemic and M and A activity, but I would draw 96 00:05:46,200 --> 00:05:51,600 Speaker 1: a parallel between the market and financial stimulus and M 97 00:05:51,600 --> 00:05:54,760 Speaker 1: and A activity, both in the sense of interest rates 98 00:05:54,800 --> 00:06:00,280 Speaker 1: being low, capital being infused into the economy, of vaccine 99 00:06:00,360 --> 00:06:03,760 Speaker 1: being a stimulant for a rebound economically and with jobs, 100 00:06:04,360 --> 00:06:10,400 Speaker 1: innovation picking up, unemployment coming down, currency devaluation in the 101 00:06:10,520 --> 00:06:15,599 Speaker 1: US UM and public market activity, So not just debt 102 00:06:15,600 --> 00:06:19,160 Speaker 1: financing being strong, but equity financing being strong, probably the 103 00:06:19,240 --> 00:06:23,520 Speaker 1: strongest has been in my lifetime. UM, with not just 104 00:06:23,600 --> 00:06:25,560 Speaker 1: SPACs but I p O S and other forms of 105 00:06:25,600 --> 00:06:30,960 Speaker 1: equity capital, all providing for a framework of activity levels 106 00:06:31,600 --> 00:06:35,040 Speaker 1: that will lead to not just consolidation in the way 107 00:06:35,080 --> 00:06:37,560 Speaker 1: you're talking about it, which is a kind of scaling up, 108 00:06:38,400 --> 00:06:42,880 Speaker 1: but also a deconstruction of companies where we're looking for 109 00:06:42,960 --> 00:06:45,839 Speaker 1: more of an opperable portfolio. So when you look at 110 00:06:45,920 --> 00:06:49,000 Speaker 1: companies like A T and T or Viacom, CBS or 111 00:06:49,720 --> 00:06:52,080 Speaker 1: any of the kind of conglomerates let's say, like the 112 00:06:52,120 --> 00:06:55,680 Speaker 1: old I T T shared ins, where not every asset 113 00:06:56,160 --> 00:07:00,440 Speaker 1: will be best situated in the same company structure, you 114 00:07:00,480 --> 00:07:03,200 Speaker 1: can separate those more easily today in the public markets 115 00:07:03,520 --> 00:07:07,600 Speaker 1: or with other strategic companies by realigning the asset mix. 116 00:07:08,200 --> 00:07:12,960 Speaker 1: Everything is available and there's a certain frenetic nature. I 117 00:07:12,960 --> 00:07:16,720 Speaker 1: think the deal making coming that will be especially in 118 00:07:16,760 --> 00:07:19,320 Speaker 1: the first half of the year with a recovery kind 119 00:07:19,360 --> 00:07:21,760 Speaker 1: of embedded with some talents, I think it will be 120 00:07:21,920 --> 00:07:24,240 Speaker 1: maybe one of our busiest years. And I do think 121 00:07:24,240 --> 00:07:27,200 Speaker 1: that that that that that like Sony is has has 122 00:07:27,240 --> 00:07:30,640 Speaker 1: been breaking off small pieces, small collections of like you 123 00:07:30,640 --> 00:07:34,760 Speaker 1: know Asian Asian TV channels that that that can be 124 00:07:34,840 --> 00:07:38,160 Speaker 1: that were sought after by some investors that knew that 125 00:07:38,240 --> 00:07:40,320 Speaker 1: business and have come in and I think that that 126 00:07:40,920 --> 00:07:43,960 Speaker 1: aspect the fact that companies might be breaking off parts 127 00:07:43,960 --> 00:07:47,120 Speaker 1: that people didn't even you know, previously, wouldn't have even 128 00:07:47,160 --> 00:07:49,400 Speaker 1: thought would have been remotely for sale or would have 129 00:07:49,440 --> 00:07:53,520 Speaker 1: been either too small or to embed it into larger operations. 130 00:07:53,560 --> 00:07:57,560 Speaker 1: But I think that having seen that, my senses that 131 00:07:57,600 --> 00:08:00,400 Speaker 1: people feel like there's a lot of opportunity. But cything 132 00:08:00,480 --> 00:08:02,280 Speaker 1: you like when you when you think about like deal 133 00:08:02,320 --> 00:08:04,560 Speaker 1: flow and I think you know, I've had these conversations 134 00:08:04,560 --> 00:08:08,360 Speaker 1: over the years, um and I appreciate our conversations because 135 00:08:08,400 --> 00:08:11,640 Speaker 1: there's a narrative behind them versus like the deal of 136 00:08:11,680 --> 00:08:15,560 Speaker 1: the moment that's breaking, which we of course never talked about. 137 00:08:15,880 --> 00:08:18,760 Speaker 1: You're always working on them, and you can never you 138 00:08:18,800 --> 00:08:21,600 Speaker 1: can never tale, you can never talk about them, which 139 00:08:21,640 --> 00:08:26,240 Speaker 1: is so funny. All most roads in media run through 140 00:08:26,320 --> 00:08:29,520 Speaker 1: lion try and that is not an exaggeration. I appreciate that. 141 00:08:29,520 --> 00:08:32,560 Speaker 1: But I I and I really love the deal and 142 00:08:32,600 --> 00:08:35,480 Speaker 1: the execution of the deal, and we obviously spent a 143 00:08:35,480 --> 00:08:37,760 Speaker 1: lot of time cultivating to make sure those deals happen. 144 00:08:38,120 --> 00:08:43,240 Speaker 1: But the narrative arc is is journalistically where we align 145 00:08:43,360 --> 00:08:47,040 Speaker 1: because I find the story of what we're actually doing 146 00:08:47,120 --> 00:08:49,839 Speaker 1: to be most interesting, and there's there has to be 147 00:08:50,000 --> 00:08:53,400 Speaker 1: rational for these deals. So for example, hypothetically, let's say 148 00:08:53,440 --> 00:08:56,640 Speaker 1: like regional sports networks kind of a troubled segment of 149 00:08:56,679 --> 00:08:58,599 Speaker 1: the media world right now, right, I mean is a 150 00:08:58,720 --> 00:09:01,880 Speaker 1: melting ice cube, like you know what, what's what's the 151 00:09:01,880 --> 00:09:05,880 Speaker 1: they're there in non demand streaming world. Correct, So so 152 00:09:05,920 --> 00:09:07,800 Speaker 1: how do you so this is not like the high 153 00:09:07,840 --> 00:09:11,560 Speaker 1: flying growth segment of you know, technology and digital and 154 00:09:11,559 --> 00:09:14,280 Speaker 1: that other parts of the world you know, would talk 155 00:09:14,320 --> 00:09:17,240 Speaker 1: about there's going public, but regional sports stutworks has to 156 00:09:17,280 --> 00:09:20,760 Speaker 1: get reworked and maybe become less regional. Maybe they should 157 00:09:20,760 --> 00:09:24,360 Speaker 1: become more natural nature. Maybe we should recreate a regional 158 00:09:24,600 --> 00:09:28,199 Speaker 1: sports network that's super regional or national, which looks a 159 00:09:28,200 --> 00:09:31,760 Speaker 1: lot more like ESPN recultivated. Right, So that's M and 160 00:09:31,800 --> 00:09:35,120 Speaker 1: A in a different way. And those are the kind 161 00:09:35,160 --> 00:09:37,240 Speaker 1: of things that we think about a lot, which is, 162 00:09:37,480 --> 00:09:40,079 Speaker 1: you know, how do you take segments of the media 163 00:09:40,160 --> 00:09:44,880 Speaker 1: industry and reorient them towards a better narrative that has 164 00:09:44,920 --> 00:09:49,640 Speaker 1: strategic value, that unlocks upside and minimize the downside to 165 00:09:49,679 --> 00:09:54,320 Speaker 1: create a more defensible asset mix. And and that is uh, 166 00:09:54,360 --> 00:09:57,120 Speaker 1: that's where we allign in terms of thinking about problems 167 00:09:57,120 --> 00:09:59,760 Speaker 1: that have to get solved, not just deal making for 168 00:09:59,840 --> 00:10:04,040 Speaker 1: do making sake. Right? Do you what what what is 169 00:10:04,080 --> 00:10:08,240 Speaker 1: the impression from investors, especially people that haven't been as 170 00:10:08,280 --> 00:10:12,920 Speaker 1: active in the core entertainment media space. I would think 171 00:10:12,960 --> 00:10:15,880 Speaker 1: that investors that would be looking at this space might 172 00:10:16,000 --> 00:10:19,040 Speaker 1: be a little cautious, going, Wow, this business needs to 173 00:10:19,080 --> 00:10:22,840 Speaker 1: reinvent itself, you know, unpack itself and you know, re 174 00:10:23,120 --> 00:10:26,360 Speaker 1: fashion in different ways. I'm going to stay out for 175 00:10:26,400 --> 00:10:28,400 Speaker 1: a few for a few years and let them figure 176 00:10:28,400 --> 00:10:30,280 Speaker 1: it out and then I'll come in. Or do you 177 00:10:30,320 --> 00:10:32,320 Speaker 1: find that there is a lot of interest in a 178 00:10:32,480 --> 00:10:35,280 Speaker 1: market that is going through a kind of a creative 179 00:10:35,280 --> 00:10:38,679 Speaker 1: destruction right now? There's a there's a great book called 180 00:10:38,679 --> 00:10:40,760 Speaker 1: The Powers that Be that you may have read, and 181 00:10:40,760 --> 00:10:43,200 Speaker 1: it's like, uh, it's not a new book, but it 182 00:10:43,240 --> 00:10:44,960 Speaker 1: goes through like some of the the origins of the 183 00:10:45,000 --> 00:10:47,720 Speaker 1: media companies, and like, did you know that the beginnings 184 00:10:47,720 --> 00:10:49,720 Speaker 1: of the uh, you know, the pay leeagus of the 185 00:10:49,720 --> 00:10:53,160 Speaker 1: CBS was a star company. Uh? And did you know 186 00:10:53,240 --> 00:10:56,960 Speaker 1: that the beginnings of Time Warner was a car garage 187 00:10:57,040 --> 00:11:02,440 Speaker 1: or funeral homes company? Can shoes right? Car garages? Yeah? 188 00:11:02,480 --> 00:11:08,120 Speaker 1: And like these are great stories of entrepreneurialism well before 189 00:11:08,200 --> 00:11:09,959 Speaker 1: the Amazons of the world, in the faithfic of the 190 00:11:10,040 --> 00:11:13,560 Speaker 1: world and the Zugerberg's and the basis so that it's 191 00:11:13,600 --> 00:11:16,199 Speaker 1: the delta, it's the change that's interesting to invest in. 192 00:11:16,720 --> 00:11:19,600 Speaker 1: It's the reinvention that's interesting to invest in, not the static. 193 00:11:20,080 --> 00:11:23,880 Speaker 1: I always say stagnation leads to decay. Motion leads to value. 194 00:11:24,400 --> 00:11:26,000 Speaker 1: So if you had the best company in the world 195 00:11:26,120 --> 00:11:29,560 Speaker 1: that printed the same revenue every year, the way that 196 00:11:30,040 --> 00:11:33,520 Speaker 1: equit markets work, the stock goes down because that equity 197 00:11:33,640 --> 00:11:36,520 Speaker 1: trade is based on the future growth of a stock. 198 00:11:37,400 --> 00:11:40,880 Speaker 1: So um, you have to have motion of growth and 199 00:11:40,920 --> 00:11:44,960 Speaker 1: being able to reinvent more construction of value out of 200 00:11:45,040 --> 00:11:48,920 Speaker 1: something then to keep it, even if it's a great company. 201 00:11:48,960 --> 00:11:51,439 Speaker 1: So that creates a lot of reinvention and investment. Some 202 00:11:51,480 --> 00:11:53,360 Speaker 1: of that works, but that doesn't. But I think to 203 00:11:53,400 --> 00:11:56,680 Speaker 1: invest in that risk, appetite and that reinvention is the 204 00:11:56,720 --> 00:11:59,240 Speaker 1: whole game. And I think that's what's most interesting about 205 00:11:59,240 --> 00:12:01,480 Speaker 1: the media industry. It's always reinventing itself. It has to 206 00:12:01,920 --> 00:12:04,840 Speaker 1: m HM. And my sense from your comment is that 207 00:12:04,880 --> 00:12:06,880 Speaker 1: there is a lot of money, there's a lot of 208 00:12:06,960 --> 00:12:10,400 Speaker 1: quote dry powder out there waiting to find the place 209 00:12:10,720 --> 00:12:12,800 Speaker 1: to park itself or put it, you know, to put 210 00:12:12,840 --> 00:12:15,880 Speaker 1: itself if there's dry powder. There are companies looking for 211 00:12:16,000 --> 00:12:18,920 Speaker 1: a quote unquote third leg to the stool where they're 212 00:12:18,960 --> 00:12:21,480 Speaker 1: looking for a new business to buy or to do 213 00:12:21,600 --> 00:12:24,040 Speaker 1: invest in UM that in a lot of cases, like 214 00:12:24,080 --> 00:12:27,560 Speaker 1: I said, is audio or gaming driven UM. There are 215 00:12:27,559 --> 00:12:30,600 Speaker 1: also companies are looking to expand in their core business 216 00:12:30,600 --> 00:12:32,640 Speaker 1: in this data age, coming out of a pandemic, you 217 00:12:32,679 --> 00:12:35,000 Speaker 1: look at your portfolio and say, how much do we 218 00:12:35,080 --> 00:12:38,160 Speaker 1: have in our business that's out of home versus insulated 219 00:12:38,200 --> 00:12:42,240 Speaker 1: in home because obviously had a premium for being insulated 220 00:12:42,280 --> 00:12:45,319 Speaker 1: in home versus out of home like theme parks, etcetera. 221 00:12:45,679 --> 00:12:47,640 Speaker 1: And should we reorient that a little bit we have 222 00:12:47,720 --> 00:12:50,880 Speaker 1: more gaming in home versus theme parks out of home. 223 00:12:51,200 --> 00:12:53,880 Speaker 1: But you can't really react to a pandemic. In my mind, 224 00:12:53,920 --> 00:12:56,800 Speaker 1: I always say, decisions that you make in a crisis 225 00:12:57,760 --> 00:13:01,360 Speaker 1: probably are biased to the consider of side. And you 226 00:13:01,400 --> 00:13:03,480 Speaker 1: really want to play a long term to a more 227 00:13:03,520 --> 00:13:07,560 Speaker 1: normalized environment and not just have a diverse life set 228 00:13:07,559 --> 00:13:10,000 Speaker 1: of assets, but an assets that that will grow to 229 00:13:10,080 --> 00:13:12,800 Speaker 1: the consumer in all ways. Since as that gets back 230 00:13:12,840 --> 00:13:15,840 Speaker 1: to your first question is how to media company position themselves. 231 00:13:16,000 --> 00:13:18,360 Speaker 1: You want to have multiple products. You don't want to 232 00:13:18,360 --> 00:13:21,000 Speaker 1: just have video streaming all the time. You know, what 233 00:13:21,080 --> 00:13:23,400 Speaker 1: else are you offering the consumer? You know, I don't. 234 00:13:23,440 --> 00:13:25,559 Speaker 1: I do believe that people will come back to theaters. 235 00:13:26,040 --> 00:13:29,600 Speaker 1: I do believe that there's an experiential model that people 236 00:13:29,600 --> 00:13:32,880 Speaker 1: will long for in the In the time of the twenties, 237 00:13:33,280 --> 00:13:36,640 Speaker 1: in the prohibition, we all long for a bottle of alcohol. 238 00:13:37,520 --> 00:13:39,800 Speaker 1: In the time of the pandemic, we're all longing for 239 00:13:39,880 --> 00:13:42,559 Speaker 1: a gathering. Let's face it. I mean, it's much more 240 00:13:42,559 --> 00:13:45,920 Speaker 1: interesting to be together. That's like a creative spark to 241 00:13:45,960 --> 00:13:48,520 Speaker 1: be together. That we have to find safe ways to 242 00:13:48,559 --> 00:13:51,839 Speaker 1: do that that are more forward leaning versus backward leaning. 243 00:13:52,160 --> 00:13:54,160 Speaker 1: I don't think there's any activity that you can tell 244 00:13:54,200 --> 00:13:57,920 Speaker 1: me about what happened in pre pandemic that didn't resume 245 00:13:58,000 --> 00:14:03,480 Speaker 1: post pandemic. So things resumed, It just maybe accelerated towards 246 00:14:03,520 --> 00:14:07,640 Speaker 1: its normal outcomes, and models will get reworked, and digitization 247 00:14:07,720 --> 00:14:09,600 Speaker 1: is here to stay at our day and age, and 248 00:14:09,679 --> 00:14:12,760 Speaker 1: so we'll just accelerate that. In areas like education, which 249 00:14:12,760 --> 00:14:16,679 Speaker 1: probably should have happened anyway, in healthcare, in e commerce, 250 00:14:17,360 --> 00:14:21,640 Speaker 1: in mobile gaming, in other areas. That's great, But we're 251 00:14:21,640 --> 00:14:23,360 Speaker 1: going to do those things, I think anyway, at a 252 00:14:23,400 --> 00:14:25,640 Speaker 1: faster pace, and I think we should just get on 253 00:14:25,640 --> 00:14:28,560 Speaker 1: board with that. I think that I have seen a 254 00:14:28,560 --> 00:14:31,080 Speaker 1: lot of commentary in the last couple of weeks about 255 00:14:31,080 --> 00:14:35,040 Speaker 1: looking at you know that nineteen eighteen. It was about 256 00:14:35,040 --> 00:14:38,200 Speaker 1: a twenty four month period and then hello, what did 257 00:14:38,200 --> 00:14:41,400 Speaker 1: we enter what did this this America enter into? Was 258 00:14:41,640 --> 00:14:45,920 Speaker 1: the literal the Roaring twenties, So you know, here's hoping 259 00:14:46,880 --> 00:14:51,400 Speaker 1: bring back two percent needle beer. Also, the twenties is 260 00:14:51,440 --> 00:14:54,440 Speaker 1: one analogy. The seventies is another analogy. And not not 261 00:14:54,480 --> 00:14:57,840 Speaker 1: to be nostalgic, because I only say that because I 262 00:14:57,880 --> 00:15:01,440 Speaker 1: think nineteen the late nineteen sixties, um, and I have 263 00:15:01,520 --> 00:15:06,200 Speaker 1: to say I wasn't born then. Sixties seemed like it 264 00:15:06,720 --> 00:15:10,600 Speaker 1: probably felt like a very heavy period of time. You 265 00:15:10,640 --> 00:15:15,760 Speaker 1: had a war, you had the assassinations of MLK, JFK 266 00:15:15,920 --> 00:15:20,560 Speaker 1: and RFK all around the same time. Imagine how scary 267 00:15:20,600 --> 00:15:24,240 Speaker 1: that must have felt. Um, And it's in the sciet 268 00:15:24,320 --> 00:15:28,360 Speaker 1: and Democratic National Convention. Correct. So that was a very 269 00:15:28,400 --> 00:15:33,320 Speaker 1: heavy period would emerge with a very gritty seventies lightness 270 00:15:33,360 --> 00:15:41,000 Speaker 1: of being a creative um revolution that ended the decade 271 00:15:41,040 --> 00:15:43,920 Speaker 1: in the nineteen seventies and seventy seven. I think with 272 00:15:43,960 --> 00:15:47,520 Speaker 1: Star Wars, a tale of morality of you know, good 273 00:15:47,520 --> 00:15:51,200 Speaker 1: and evil and fantasy and sci fi and you know, 274 00:15:51,320 --> 00:15:54,240 Speaker 1: and so I think that was like everyone got on 275 00:15:54,280 --> 00:15:58,520 Speaker 1: board with this this beautiful like creative, like fantasy world 276 00:15:58,920 --> 00:16:01,360 Speaker 1: that carried us for a while until like obviously the eighties, 277 00:16:01,400 --> 00:16:04,520 Speaker 1: which was a high finance, you know world, and you know, 278 00:16:04,800 --> 00:16:07,360 Speaker 1: Reagan and everything else. So um and I just I 279 00:16:07,400 --> 00:16:09,920 Speaker 1: just think there's maybe a potential of we're both in 280 00:16:09,920 --> 00:16:14,480 Speaker 1: New York, like a grittiness of creative like uh, explosions 281 00:16:14,520 --> 00:16:17,520 Speaker 1: of output of what the culture will look like coming 282 00:16:17,520 --> 00:16:19,560 Speaker 1: out of this. That's I'm really interested in that. From 283 00:16:19,600 --> 00:16:22,560 Speaker 1: a media perspective, I wanted to talk about gaming because 284 00:16:22,560 --> 00:16:24,880 Speaker 1: you mentioned you've mentioned gaming as a you know, as 285 00:16:25,040 --> 00:16:27,360 Speaker 1: a force, and it's been interesting to me as long 286 00:16:27,400 --> 00:16:31,080 Speaker 1: as I've been covering entertainment, gaming has always been just 287 00:16:31,240 --> 00:16:35,440 Speaker 1: a little to the side of the core film and television, 288 00:16:35,480 --> 00:16:38,800 Speaker 1: the core sort of Hollywood entertainment business. Do you ever 289 00:16:39,080 --> 00:16:42,160 Speaker 1: do you see an activism Blizzard or anyone of the 290 00:16:42,520 --> 00:16:45,760 Speaker 1: or an e A. Do you see ever a tighter, 291 00:16:46,600 --> 00:16:51,560 Speaker 1: a tighter consolidation with a traditional Hollywood company. We've seen 292 00:16:51,600 --> 00:16:55,680 Speaker 1: it in Sony PlayStation, but as many times as they've tried, 293 00:16:55,760 --> 00:16:59,360 Speaker 1: they've never I don't think you've ever really seen an 294 00:16:59,360 --> 00:17:04,720 Speaker 1: integration of PlayStation technology and movie technology or television. They've 295 00:17:04,760 --> 00:17:06,800 Speaker 1: tried it in different one offs, but never on a 296 00:17:07,080 --> 00:17:09,920 Speaker 1: It's never like on a level that it really stuck. 297 00:17:10,240 --> 00:17:12,959 Speaker 1: Is there something about the gaming business that is just 298 00:17:13,000 --> 00:17:18,160 Speaker 1: sort of necessarily arms length from traditional film and TV? Yeah, 299 00:17:18,240 --> 00:17:20,639 Speaker 1: I think that that's changed. I think the way you 300 00:17:20,720 --> 00:17:24,080 Speaker 1: describe gaming as sort of an activity or an application 301 00:17:24,160 --> 00:17:26,960 Speaker 1: of a platform, I think is a thing of the past, 302 00:17:27,000 --> 00:17:29,960 Speaker 1: and I think it's a matter of having gotten to 303 00:17:30,000 --> 00:17:34,359 Speaker 1: the scale and the reach of the consumer um that 304 00:17:34,440 --> 00:17:38,520 Speaker 1: we're now at today makes an activision more take two 305 00:17:38,640 --> 00:17:42,560 Speaker 1: or an e a kind of simulate a Netflix like 306 00:17:43,119 --> 00:17:46,120 Speaker 1: uh customer profile, and then once you have that same 307 00:17:46,200 --> 00:17:49,960 Speaker 1: kind of reach, then it's all about having the content. UH. 308 00:17:50,000 --> 00:17:53,480 Speaker 1: And once you have that reach and the content, you 309 00:17:53,520 --> 00:17:57,359 Speaker 1: can create the same kind of ecosystem where you have 310 00:17:57,400 --> 00:18:01,399 Speaker 1: a subscription model with a with different types of content 311 00:18:01,760 --> 00:18:04,400 Speaker 1: that's both you know, gaming as well as the video 312 00:18:04,400 --> 00:18:10,240 Speaker 1: consumption Similarly, Netflix, with its reach and video content, can 313 00:18:10,400 --> 00:18:13,080 Speaker 1: become more of a gaming platform. And I think you're 314 00:18:13,080 --> 00:18:19,000 Speaker 1: gonna see those platforms kind of mailed closer together. And 315 00:18:19,119 --> 00:18:21,040 Speaker 1: uh and I think that's where I say gaming is 316 00:18:21,080 --> 00:18:23,960 Speaker 1: more of the new Internet. It's more of a platform 317 00:18:24,000 --> 00:18:27,600 Speaker 1: that will have video not just games inside, because it 318 00:18:27,640 --> 00:18:31,280 Speaker 1: will be a way of doing things virtually. Then that 319 00:18:31,280 --> 00:18:36,080 Speaker 1: that that is kind of generational, um, but completely now 320 00:18:36,280 --> 00:18:39,160 Speaker 1: part of the mainstream than when I grew up, at least, 321 00:18:39,640 --> 00:18:42,000 Speaker 1: where it was more of an activity. And uh and 322 00:18:42,040 --> 00:18:44,159 Speaker 1: I think that Uh. I talk a lot about that 323 00:18:44,200 --> 00:18:47,879 Speaker 1: in the letter because it's really it's a metaverse. Uh. 324 00:18:47,920 --> 00:18:50,399 Speaker 1: And we strongly believe that we've invested a lot in 325 00:18:50,920 --> 00:18:54,440 Speaker 1: not just our gaming advisory and banking franchise and advising companies, 326 00:18:54,920 --> 00:18:58,919 Speaker 1: but also in investing and the growth companies pre I, 327 00:18:59,040 --> 00:19:02,439 Speaker 1: p O and pre Eminent, because I think there are 328 00:19:02,480 --> 00:19:06,040 Speaker 1: social networks to gaming, like the discords and the roadblocks 329 00:19:06,040 --> 00:19:09,520 Speaker 1: of the world. Um. So it's not just the consoles, uh, 330 00:19:09,520 --> 00:19:12,040 Speaker 1: it's and the scope leaves of the world. So we're 331 00:19:12,119 --> 00:19:14,320 Speaker 1: very active in the gaming business, even even the ones 332 00:19:14,359 --> 00:19:18,040 Speaker 1: that't a private mm hmm. Fortnite is as much a 333 00:19:18,080 --> 00:19:22,720 Speaker 1: competitor to Netflix as Amazon and Hulu for both time 334 00:19:22,920 --> 00:19:27,760 Speaker 1: and also, as you said, just purely from a streaming platform, 335 00:19:28,000 --> 00:19:30,920 Speaker 1: it will if there was a movie studio for sale, 336 00:19:31,520 --> 00:19:36,000 Speaker 1: I would bet on a gaming company looking to buy 337 00:19:36,040 --> 00:19:39,360 Speaker 1: it as much as a media company looking to buy 338 00:19:39,359 --> 00:19:42,480 Speaker 1: it or technology platform. Is the era of the bundle over? 339 00:19:42,960 --> 00:19:48,520 Speaker 1: Has streaming? Has streaming made the traditional notion of the 340 00:19:48,520 --> 00:19:52,320 Speaker 1: the m v PD cable bundle that drove twenty five 341 00:19:52,400 --> 00:19:56,240 Speaker 1: years of earnings for the largest media companies? Is that bundle? 342 00:19:56,880 --> 00:19:59,640 Speaker 1: Is that bundle praying to the point of not being 343 00:19:59,680 --> 00:20:02,800 Speaker 1: able to really be be put back together within like 344 00:20:02,840 --> 00:20:05,439 Speaker 1: a couple of years, or do you think that that 345 00:20:05,440 --> 00:20:08,760 Speaker 1: that that the impact of streaming has been maybe a 346 00:20:08,840 --> 00:20:14,159 Speaker 1: little overstated on the on the content companies. Um I, 347 00:20:14,160 --> 00:20:17,400 Speaker 1: I definitely think we're in an ali card world. Um 348 00:20:17,560 --> 00:20:20,720 Speaker 1: I don't think that's being widely acknowledged, but it certainly 349 00:20:20,840 --> 00:20:24,280 Speaker 1: is an ali card world, which, like anything direct consumer 350 00:20:24,400 --> 00:20:28,679 Speaker 1: or digital, has risk of pricing coming lower for the 351 00:20:28,720 --> 00:20:33,240 Speaker 1: content companies unless packaged in a different way. So when 352 00:20:33,280 --> 00:20:38,000 Speaker 1: you see Disney Plus have proprietary exclusive content on its 353 00:20:38,040 --> 00:20:41,119 Speaker 1: own platform, that's another form of bundle, just bundle in 354 00:20:41,200 --> 00:20:45,080 Speaker 1: its own ecosystem right or Warner with HBO Max that's 355 00:20:45,080 --> 00:20:48,040 Speaker 1: its own bundle. Right, it's just bundle at the exclusion 356 00:20:48,080 --> 00:20:52,359 Speaker 1: of other content. Um. And over time the next stage 357 00:20:52,359 --> 00:20:55,560 Speaker 1: of that development will be the platform players will either 358 00:20:55,760 --> 00:21:00,080 Speaker 1: have proprietary content that they own on their platform and 359 00:21:00,119 --> 00:21:02,960 Speaker 1: that's it in a closed in a closed garden, or 360 00:21:03,000 --> 00:21:05,800 Speaker 1: they will open it and least other content, which will 361 00:21:05,840 --> 00:21:08,760 Speaker 1: give power to the platform long term with the biggest 362 00:21:08,760 --> 00:21:13,639 Speaker 1: reach versus UH content that's not owned by those platforms, 363 00:21:13,640 --> 00:21:15,640 Speaker 1: and the content that's not owned by the platform will 364 00:21:15,680 --> 00:21:19,320 Speaker 1: be leased by by many platforms, and the long term 365 00:21:19,359 --> 00:21:21,480 Speaker 1: power will be in the distribution. Of my mind, what 366 00:21:21,520 --> 00:21:25,560 Speaker 1: do you think is the runway to profitability, for true 367 00:21:25,600 --> 00:21:30,639 Speaker 1: profitability for a Disney Plus or an HBO Max, given 368 00:21:31,640 --> 00:21:34,760 Speaker 1: you know what they compared to what they would have 369 00:21:35,200 --> 00:21:37,639 Speaker 1: been able to earn, say five years ago, in a 370 00:21:37,640 --> 00:21:41,720 Speaker 1: more stable traditional m v p D environment. You're you're 371 00:21:41,720 --> 00:21:46,159 Speaker 1: really getting to the question of as a traditional model 372 00:21:46,200 --> 00:21:50,639 Speaker 1: between content and distribution with the cable operators or the 373 00:21:50,680 --> 00:21:55,119 Speaker 1: satellite operators breaks down in a bundle format and the 374 00:21:55,200 --> 00:22:00,320 Speaker 1: content companies go direct to consumer, is their value leakage UM, 375 00:22:01,280 --> 00:22:04,520 Speaker 1: that's a much better way to say it. We live 376 00:22:04,600 --> 00:22:07,000 Speaker 1: this every day. It was the economics. They gotta break 377 00:22:07,119 --> 00:22:09,720 Speaker 1: to the point where maybe it looks sexy in these 378 00:22:09,760 --> 00:22:14,080 Speaker 1: business models. Uh, director consumer around the whole plus side 379 00:22:14,119 --> 00:22:16,640 Speaker 1: of what these companies are going, but it really doesn't 380 00:22:16,720 --> 00:22:19,680 Speaker 1: hold up financially long term to a shareholder. So the 381 00:22:19,760 --> 00:22:23,240 Speaker 1: answer to that question is, um, there's definitely economic risk 382 00:22:23,320 --> 00:22:27,000 Speaker 1: to the content companies as they abandoned the cable companies 383 00:22:27,400 --> 00:22:31,600 Speaker 1: and go direct to the consumer unless two things happen. One, 384 00:22:32,400 --> 00:22:35,840 Speaker 1: they have enough global scale to make up for the 385 00:22:35,960 --> 00:22:39,000 Speaker 1: regional ecosystem that the cable operators owned, because the cable 386 00:22:39,040 --> 00:22:42,520 Speaker 1: operators are really super regional. You know, there's no real 387 00:22:42,680 --> 00:22:46,159 Speaker 1: national cable operators still, right. We have many in the 388 00:22:46,280 --> 00:22:49,080 Speaker 1: U S still two, three or four, but not a 389 00:22:49,200 --> 00:22:52,159 Speaker 1: national player. So if you could have global reach and 390 00:22:52,280 --> 00:22:55,440 Speaker 1: Disney can reach a global customer base like Netflix, then 391 00:22:55,480 --> 00:22:57,760 Speaker 1: you can become a global channel and make up some 392 00:22:57,800 --> 00:23:01,399 Speaker 1: of those economics um and maybe even super seats on 393 00:23:01,400 --> 00:23:04,760 Speaker 1: those economics with a loyal consumer base too. You have 394 00:23:04,920 --> 00:23:08,399 Speaker 1: to have an investment in content that continues over time, 395 00:23:09,240 --> 00:23:13,399 Speaker 1: that allows the consumer to stay with your platform and 396 00:23:13,480 --> 00:23:16,879 Speaker 1: allows Disney, as this example, how to have pricing power 397 00:23:17,240 --> 00:23:20,479 Speaker 1: over that consumer because you have to keep raising prices um. 398 00:23:21,200 --> 00:23:23,880 Speaker 1: That will want the consumer to feel like they're getting 399 00:23:23,920 --> 00:23:28,399 Speaker 1: more value for that for that subscriber, for that subscriber cost. 400 00:23:28,880 --> 00:23:31,080 Speaker 1: And then three, you have to bring the capable operators 401 00:23:31,080 --> 00:23:33,920 Speaker 1: along with you. You you really, you really have to 402 00:23:34,400 --> 00:23:37,600 Speaker 1: in order to to not cannibalize your existing business. You 403 00:23:37,720 --> 00:23:40,080 Speaker 1: have to bring them along with you. That that potentially 404 00:23:40,119 --> 00:23:43,679 Speaker 1: could be done in in the revenue splits or working 405 00:23:43,760 --> 00:23:47,400 Speaker 1: with the cable operators in different digital ways. And that's 406 00:23:47,440 --> 00:23:50,680 Speaker 1: gonna be important. By and large, we're talking about the 407 00:23:51,000 --> 00:23:53,600 Speaker 1: have and have not. The Disney of the world is 408 00:23:53,640 --> 00:23:56,680 Speaker 1: a scale player. The other content companies may not be 409 00:23:56,720 --> 00:23:59,639 Speaker 1: able to do that. Discovery could do that, um, but 410 00:23:59,760 --> 00:24:02,760 Speaker 1: they're very few content companies that can actually have a 411 00:24:02,800 --> 00:24:06,080 Speaker 1: global reach of the consumer. So as the bundle breaks, 412 00:24:06,200 --> 00:24:09,480 Speaker 1: it definitely hurts the content industry overall, except for the 413 00:24:09,560 --> 00:24:13,639 Speaker 1: top players, which must must yield more consolidation among the 414 00:24:13,720 --> 00:24:18,879 Speaker 1: content companies to have more power and breath around the 415 00:24:18,960 --> 00:24:22,240 Speaker 1: global consumer base or have alignment with other platforms like 416 00:24:22,280 --> 00:24:26,160 Speaker 1: technology platforms. Long term, if Disney, since Disney has put 417 00:24:26,200 --> 00:24:29,280 Speaker 1: those numbers out there, Disney put out Um, I believe 418 00:24:30,920 --> 00:24:33,560 Speaker 1: that they're aiming for as many as two thirty to 419 00:24:34,200 --> 00:24:38,679 Speaker 1: sixty million subscribers to Disney Plus long term. If they 420 00:24:38,760 --> 00:24:43,399 Speaker 1: get within that range internationally, they will not miss the 421 00:24:43,520 --> 00:24:46,320 Speaker 1: seven dollars a month that they were getting per sub 422 00:24:47,000 --> 00:24:50,560 Speaker 1: in the old world. For ESPN like that, the business 423 00:24:50,600 --> 00:24:52,840 Speaker 1: model is strong. And if they reach that scale, in 424 00:24:52,960 --> 00:24:55,040 Speaker 1: your in your view and I know you your folks 425 00:24:55,080 --> 00:24:57,880 Speaker 1: study this all day long, that they if they reach 426 00:24:58,000 --> 00:25:00,520 Speaker 1: that scale, that they will be that they will be 427 00:25:00,600 --> 00:25:03,800 Speaker 1: even better off than they were in the glory days 428 00:25:03,920 --> 00:25:06,640 Speaker 1: of let's call it, you know, ten, ten, twelve years 429 00:25:06,640 --> 00:25:10,760 Speaker 1: ago in the cable business. Yes, as long as those 430 00:25:10,800 --> 00:25:14,840 Speaker 1: customers hold. Because there's a concept around any consumer business 431 00:25:14,920 --> 00:25:18,879 Speaker 1: that's called churn. And then there's another concept called price lasticity, 432 00:25:19,320 --> 00:25:21,879 Speaker 1: which means, you know, what is the price that you 433 00:25:22,000 --> 00:25:25,880 Speaker 1: could you know, raise your rates at without risking turn 434 00:25:26,840 --> 00:25:29,520 Speaker 1: And um, that is a hallmark of any distribution model, 435 00:25:29,520 --> 00:25:31,600 Speaker 1: whether it's a wireless model or a cable model, or 436 00:25:31,600 --> 00:25:35,399 Speaker 1: a satellite model or a you know, five G model. UM, 437 00:25:35,760 --> 00:25:38,159 Speaker 1: we've always had to measure these things over time, and 438 00:25:38,280 --> 00:25:42,080 Speaker 1: so pricing is not you know, in elastic you know, 439 00:25:42,160 --> 00:25:44,639 Speaker 1: you have to really look at what you're offering the 440 00:25:44,720 --> 00:25:46,680 Speaker 1: consumer to be able to raise prices. If you're in 441 00:25:46,720 --> 00:25:50,879 Speaker 1: a broadbad environment, that's about speeding capacity and access, you 442 00:25:50,960 --> 00:25:52,600 Speaker 1: have to be able to raise prices. If you're in 443 00:25:52,640 --> 00:25:54,959 Speaker 1: a video environment, you have to give them more content, 444 00:25:55,640 --> 00:25:58,160 Speaker 1: and you have to give them more offerings, or maybe 445 00:25:58,160 --> 00:26:00,000 Speaker 1: you have to offer more than this video, like I said, 446 00:26:00,119 --> 00:26:02,640 Speaker 1: gaming and audio or other things, more products and services. 447 00:26:03,040 --> 00:26:05,960 Speaker 1: So you have to spend to offer more. That's what 448 00:26:06,080 --> 00:26:08,960 Speaker 1: Netflix has been doing, and so you have to reach 449 00:26:09,000 --> 00:26:11,560 Speaker 1: a point of critical maths to be able to have 450 00:26:11,680 --> 00:26:16,480 Speaker 1: that marginal costs to spend affordable on the platform. And 451 00:26:16,600 --> 00:26:19,680 Speaker 1: that's only going to be there for very few players. 452 00:26:20,320 --> 00:26:23,560 Speaker 1: Everyone else will have to align with other platforms or 453 00:26:23,640 --> 00:26:27,520 Speaker 1: merge with other platforms to create ecosystem of five or 454 00:26:27,600 --> 00:26:30,320 Speaker 1: six or seven global competitors. Everyone else will be part 455 00:26:30,359 --> 00:26:33,119 Speaker 1: of that, and that's a new ecosystem that basically similarly 456 00:26:33,119 --> 00:26:35,960 Speaker 1: it's the old cable model we've been talking about, very 457 00:26:36,040 --> 00:26:40,040 Speaker 1: traditional Hollywood. There's a lot going there's a lot in 458 00:26:40,080 --> 00:26:42,840 Speaker 1: the ether right now about big tech and a lot 459 00:26:42,960 --> 00:26:45,960 Speaker 1: of you know, there's a lot of talk about the 460 00:26:46,040 --> 00:26:50,720 Speaker 1: threat of regulation of antitrust concerns and even bringing breaking 461 00:26:50,840 --> 00:26:56,480 Speaker 1: up Facebook's Googles, you know, the dominant duopolis in the market. 462 00:26:56,800 --> 00:26:59,600 Speaker 1: Do you see a do you think that there isn't 463 00:27:00,040 --> 00:27:03,520 Speaker 1: is a real threat of of of there will be 464 00:27:03,560 --> 00:27:06,359 Speaker 1: a lot of noise about regulatory activity, but do you 465 00:27:06,440 --> 00:27:09,960 Speaker 1: think that there's a real head of steam to put 466 00:27:10,080 --> 00:27:15,639 Speaker 1: regulations around things like Facebook and or or UM. You know, 467 00:27:15,920 --> 00:27:18,280 Speaker 1: Google is under a lot of antitrust and you know, 468 00:27:18,680 --> 00:27:22,440 Speaker 1: market scrutiny right now for various various operations. Do you 469 00:27:22,520 --> 00:27:25,480 Speaker 1: think that, especially with the Biden administration coming in, that 470 00:27:25,600 --> 00:27:28,680 Speaker 1: we will see actually real activity on the regulatory front, 471 00:27:28,760 --> 00:27:32,840 Speaker 1: beyond beyond hearings and you know, noise, that there will 472 00:27:32,880 --> 00:27:35,880 Speaker 1: be actual action. I think that Google and Facebook will 473 00:27:35,920 --> 00:27:40,200 Speaker 1: be regulated UM. I don't think Google and Facebook will 474 00:27:40,200 --> 00:27:44,480 Speaker 1: be forced to break up the regulations. When I say regulated, 475 00:27:44,600 --> 00:27:47,880 Speaker 1: I mean there's things like Section two thirty. I think 476 00:27:48,000 --> 00:27:54,119 Speaker 1: that there is UM elements of restrictions on UM, the 477 00:27:54,720 --> 00:27:58,480 Speaker 1: privacy rules and the way that their different divisions work together. 478 00:27:59,040 --> 00:28:01,240 Speaker 1: I think there's certainly glacier already coming out of the EU, 479 00:28:01,680 --> 00:28:05,439 Speaker 1: even more stringent than in the US. UM. But by 480 00:28:05,520 --> 00:28:07,840 Speaker 1: and large, I think these companies have been very innovative 481 00:28:08,119 --> 00:28:12,000 Speaker 1: and should not be penalized by virtue just being innovative 482 00:28:12,040 --> 00:28:16,960 Speaker 1: platforms UM, you know. And I don't think that any 483 00:28:17,040 --> 00:28:20,720 Speaker 1: of them are too big for this environment because I 484 00:28:20,800 --> 00:28:24,600 Speaker 1: think the access to capital for other companies are available 485 00:28:24,760 --> 00:28:28,640 Speaker 1: to try to to be built as well and UM. 486 00:28:28,920 --> 00:28:32,120 Speaker 1: And I think that the way that the FTC, which 487 00:28:32,320 --> 00:28:36,879 Speaker 1: really regulates Facebook and Amazon, the way that the d 488 00:28:37,040 --> 00:28:39,960 Speaker 1: o J, which really read grades Amazon, UM sorry, Google 489 00:28:40,600 --> 00:28:43,720 Speaker 1: and Apple approaches that will be very different. Uh. And 490 00:28:43,840 --> 00:28:46,680 Speaker 1: I think that the FTC has moved faster with the 491 00:28:47,040 --> 00:28:51,320 Speaker 1: Facebook lawsuit UM at this point, but I think over 492 00:28:51,360 --> 00:28:54,680 Speaker 1: the next few years UM, we will see much more 493 00:28:55,240 --> 00:28:58,520 Speaker 1: kind of headline noise than any kind of risk of breakups. 494 00:28:59,040 --> 00:29:01,200 Speaker 1: But I think there is a real need for regulation 495 00:29:01,320 --> 00:29:04,640 Speaker 1: around replicating what traditional media has had to deal with, 496 00:29:05,040 --> 00:29:06,960 Speaker 1: which is like what you can say, what you can't 497 00:29:07,000 --> 00:29:10,320 Speaker 1: say UM, and that should approach some kind of UM 498 00:29:11,120 --> 00:29:15,560 Speaker 1: standard with social networks as well as traditional media networks. 499 00:29:15,920 --> 00:29:17,920 Speaker 1: That should be some sort of consistency there that I 500 00:29:17,960 --> 00:29:21,480 Speaker 1: think you'll see the next few years. How the democratic 501 00:29:21,520 --> 00:29:25,920 Speaker 1: administrations deal with M and A and tech UM remains 502 00:29:25,920 --> 00:29:27,800 Speaker 1: to be seen. I mean that also kind of goes 503 00:29:27,840 --> 00:29:31,120 Speaker 1: into materiality these companies are so big, whether they buy 504 00:29:31,240 --> 00:29:33,880 Speaker 1: something that actually gets to a point of a shareholder 505 00:29:33,920 --> 00:29:37,280 Speaker 1: vote or a regulauthority vote remains to be seen because 506 00:29:37,280 --> 00:29:40,040 Speaker 1: a lot of these transactions are too small to even 507 00:29:40,160 --> 00:29:43,360 Speaker 1: get to the kind of scrutiny. Um but um, but 508 00:29:43,640 --> 00:29:49,000 Speaker 1: certainly democratic institutions and administrations tracially speaking are more more 509 00:29:49,080 --> 00:29:50,800 Speaker 1: cautious with respect to M and A and will have 510 00:29:50,880 --> 00:29:53,360 Speaker 1: to be uh cognizant that that's a big rispect for 511 00:29:53,400 --> 00:29:55,600 Speaker 1: all of us. Do you think that the that the 512 00:29:55,960 --> 00:29:58,240 Speaker 1: that the sense of you know that there's going to 513 00:29:58,360 --> 00:30:01,200 Speaker 1: be some governmental active the around big tech. Has that 514 00:30:01,440 --> 00:30:05,560 Speaker 1: made media a little more attractive for investors? That there's 515 00:30:06,160 --> 00:30:08,120 Speaker 1: there's big issues that big tech is going to have 516 00:30:08,200 --> 00:30:10,880 Speaker 1: to deal with. Is that is that making media look 517 00:30:10,880 --> 00:30:14,400 Speaker 1: a little more attractive? I mean, yes, that in the 518 00:30:14,480 --> 00:30:16,960 Speaker 1: sense of media is not in in the ire of 519 00:30:17,000 --> 00:30:19,960 Speaker 1: the regulators, But no in the sense of if we're 520 00:30:20,000 --> 00:30:23,200 Speaker 1: expecting media to be acquired by the tech companies. So 521 00:30:23,520 --> 00:30:27,880 Speaker 1: um um. I think it's an intertwined ecosystem at this point. Um. 522 00:30:28,400 --> 00:30:31,880 Speaker 1: And I think there's a lot of power that that 523 00:30:32,000 --> 00:30:33,880 Speaker 1: the tech companies have in terms of the reach of 524 00:30:33,920 --> 00:30:37,840 Speaker 1: the consumer UM, but there's a lot of UM. There's 525 00:30:37,840 --> 00:30:40,560 Speaker 1: a lot of respect the media commis should get in 526 00:30:40,680 --> 00:30:44,320 Speaker 1: terms of being able to really produce great content. And 527 00:30:44,520 --> 00:30:47,040 Speaker 1: I think the relationship with the talent it's hard to 528 00:30:47,120 --> 00:30:50,920 Speaker 1: replicate UM, but but ultimately we'll have to be aligned 529 00:30:50,960 --> 00:30:54,080 Speaker 1: with the platforms. I think they getting the alignment between 530 00:30:54,120 --> 00:30:58,280 Speaker 1: the content production, the talent, and the innovation with these 531 00:30:58,320 --> 00:31:02,960 Speaker 1: economic models is where the complexity sits. The the I 532 00:31:03,080 --> 00:31:06,040 Speaker 1: was saying to you earlier that UM, the relationship between 533 00:31:06,160 --> 00:31:10,200 Speaker 1: talent and economic models and innovation in the media industry 534 00:31:11,000 --> 00:31:14,360 Speaker 1: is so nuanced and has to be respected in a 535 00:31:14,400 --> 00:31:17,200 Speaker 1: way that's not like any other industry where you can 536 00:31:17,280 --> 00:31:20,680 Speaker 1: just innovate your way through economic models and say we're 537 00:31:20,720 --> 00:31:23,600 Speaker 1: now going digital, we're going to e commerce, and all 538 00:31:23,680 --> 00:31:27,040 Speaker 1: just makes sense because talent has a lot of power 539 00:31:28,000 --> 00:31:30,959 Speaker 1: in this ecosystem that we live in, and they shouldn't 540 00:31:30,960 --> 00:31:34,680 Speaker 1: have a lot of power because the brands or the 541 00:31:34,920 --> 00:31:39,920 Speaker 1: creative engine that makes media special UM has casual streams 542 00:31:39,960 --> 00:31:42,920 Speaker 1: attached to them. They're not just UM. You know, voices 543 00:31:43,400 --> 00:31:46,520 Speaker 1: are artists. They have casual streams and maybe they have 544 00:31:46,600 --> 00:31:48,840 Speaker 1: more power than the corporations. A lot of ways and 545 00:31:48,920 --> 00:31:51,600 Speaker 1: if you disenfranchise the talent, you kind of lose the 546 00:31:51,680 --> 00:31:54,160 Speaker 1: engine of what makes the immediate strey special, so that 547 00:31:54,320 --> 00:31:57,000 Speaker 1: that relationship has to get cultivated in a similar way 548 00:31:57,000 --> 00:31:59,720 Speaker 1: as that, you know, content and distribution has found its 549 00:32:00,040 --> 00:32:03,280 Speaker 1: harmony and marriage and a trictional cable and cable network 550 00:32:03,320 --> 00:32:09,400 Speaker 1: ecosystem are a What is your boldest prediction for Well, 551 00:32:10,000 --> 00:32:14,160 Speaker 1: it's a great question because everything about this industry has 552 00:32:14,320 --> 00:32:17,000 Speaker 1: an element of boldness to it. But let me see 553 00:32:17,000 --> 00:32:20,880 Speaker 1: if I could, um stretch my thinking for your podcast 554 00:32:20,920 --> 00:32:25,800 Speaker 1: a little bit, um for I'll do for plus in 555 00:32:25,960 --> 00:32:28,800 Speaker 1: the vein of of the letter and how we're thinking 556 00:32:28,800 --> 00:32:33,120 Speaker 1: about things. So the branding of the industry, Yeah, exactly, 557 00:32:33,760 --> 00:32:38,720 Speaker 1: Um so a few things. Music concerts and festivals will 558 00:32:38,800 --> 00:32:43,040 Speaker 1: come back faster than movies from your lips. The sports 559 00:32:43,120 --> 00:32:46,920 Speaker 1: industry will be completely realigned and adjusted. In the Buffalo 560 00:32:47,000 --> 00:32:50,840 Speaker 1: Bills will win the Super Bowl good defense. A major 561 00:32:51,080 --> 00:32:54,880 Speaker 1: university will go digital as a long term strategy to 562 00:32:54,960 --> 00:33:00,320 Speaker 1: expand its reach and innovation fully virtual, Intriguing people are 563 00:33:00,360 --> 00:33:03,880 Speaker 1: going to travel to space, and tourism of all kinds 564 00:33:03,960 --> 00:33:06,360 Speaker 1: will take off in the coming year. And the next 565 00:33:06,480 --> 00:33:10,800 Speaker 1: US president will be a woman. Finally, Wow, all exciting 566 00:33:10,880 --> 00:33:15,040 Speaker 1: things to look forward to in plus Aria, Thank you 567 00:33:15,160 --> 00:33:18,400 Speaker 1: so much for your time. Always a fascinating conversation with you. 568 00:33:18,760 --> 00:33:28,200 Speaker 1: Thanks so much, Cynthia, have a great time. Thanks for listening. 569 00:33:28,600 --> 00:33:31,160 Speaker 1: Be sure to tune in next week for another episode 570 00:33:31,200 --> 00:33:34,040 Speaker 1: of Strictly Business, and please leave us a review at 571 00:33:34,080 --> 00:33:36,840 Speaker 1: Apple Podcasts. We love to hear from listeners.