Speaker 1: This is Bloomberg Business Week from Bloomberg Radio. Hi, I'm
Speaker 1: Jason Kelly and I'm Carol Masser. Welcome to the weekend
Speaker 1: edition of Bloomberg Business Week. Over the next couple of hours,
Speaker 1: news of the week, insights from the magazine, and so
Speaker 1: much more. We had lots going on when it comes
Speaker 1: to the sports world, Absolutely so much going on because
Speaker 1: it's Super Bowl weekend. It is the big game. We
Speaker 1: were in Miami this week. We're gonna bring you next
Speaker 1: week a lot of the conversations that we had down there,
Speaker 1: But this week we had a little bit of a
Speaker 1: preview from the CEO and chairman of hard Rock International.
Speaker 1: It's their stadium that the big Game is being played in,
Speaker 1: and we stayed with sports. We've got a great story
Speaker 1: from Arah Boudway about Joe Sigh. He is the majority
Speaker 1: owner of the Brooklyn Nets. Only last year became that
Speaker 1: and it happened. Jason, of course, talk about timing just
Speaker 1: before a controversy that would threaten the NBA's relationship with
Speaker 1: its most important overseas market. We're talking about China well,
Speaker 1: and we talk about China and the NBA also with
Speaker 1: Chris Paul All, He's an NBA star also the president
Speaker 1: of the Players Association, so he has some thoughts on
Speaker 1: that as well as building out his own business. Speaking
Speaker 1: of presidents, there's a lot of mansions down in Palm
Speaker 1: Beach just near the president's private club. We're talking about
Speaker 1: Moral Lago and for some reason they're not selling. And
Speaker 1: speaking of mar Lago, we know a lot of business
Speaker 1: gets done. They're including about trade. We're going to bring
Speaker 1: you another angle on the US trade war with China.
Speaker 1: Phase one of the US China trade deal. It is done, Jason.
Speaker 1: We know that tower still exists on some Chinese good
Speaker 1: and despite the on again offic intentions between the two countries,
Speaker 1: a move last year by the US actually gave Chinese
Speaker 1: solar panels a bit of a gift. It did, and
Speaker 1: this is one of these unexpected benefits or detriments, depending
Speaker 1: on your side of the equation to these trade negotiations.
Speaker 1: Bryan peck House is here with us. He's going to
Speaker 1: tell us all about it. So this is a booming business. Obviously,
Speaker 1: we talk a lot about alternative energy, and yet I'm
Speaker 1: not sure any but he knew this was really the
Speaker 1: forefront or a flash point in the trade wars. Yeah. Absolutely.
Speaker 1: One of the first tariffs that Trump imposed was on
Speaker 1: solar panels. It was two years ago this month, and
Speaker 1: it definitely rejiggered the entire industry, and they run up
Speaker 1: to him making the decision. The market slowed down considerably
Speaker 1: because we knew he was gonna imposed tariffs, but how big,
Speaker 1: how long, and so it really slowed down the development
Speaker 1: solar farms in the desert, on rooftops, but more than
Speaker 1: the big products in the desert went around the country,
Speaker 1: and then he imposed these tariffs and people were like,
Speaker 1: wait a minute, like we didn't do anything to deserve
Speaker 1: this fight between US and China. But going back a
Speaker 1: little bit further, Uh, the US makes very very few panels.
Speaker 1: It relies very heavily on Asia. Chinese companies are the
Speaker 1: big makers. Are these products products not also from China,
Speaker 1: from China, but also from Malaysia, from Thailand, from Vietnam,
Speaker 1: And so it's been a years long sort fight between
Speaker 1: the countries on this. It predated Trump, but then he
Speaker 1: put his imprint on it two years ago. Well that's
Speaker 1: I think some history is important here in terms of
Speaker 1: the U s trying to develop, right, it's solar industry
Speaker 1: Brian and then you know allegations or realities of the
Speaker 1: Chinese undercutting in terms of pricing and really kind of
Speaker 1: owning this market. Yeah. Absolutely. I mean China has dominated
Speaker 1: this market because they have the cheapest panels out there
Speaker 1: for many cases, the cheapest panels, and it's hard to
Speaker 1: compete with that. It's more expensive in the US to
Speaker 1: develop it and to buy it in the US. So
Speaker 1: if you're you know, solar farm developer, and you're you're
Speaker 1: competing against wind, natural gas, fire power plants, you know,
Speaker 1: if you're trying to go and you know inspire boom
Speaker 1: of solar, you're gonna go probably the cheapest form of
Speaker 1: solar cost provider. Right. That means China, that means Asia,
Speaker 1: and they've come to dominate the market. And by the
Speaker 1: Tom Trump came into impose these tariffs, there was so
Speaker 1: little manufacturing of solar panels in this country. A lot
Speaker 1: of people have to depend on Asia for it. And
Speaker 1: so take us to this moment. Air folks from the industry,
Speaker 1: they start literally like calling their member of Congress, They
Speaker 1: start lobbying, they start doing all the things that an
Speaker 1: industry does to try and get some action. They win.
Speaker 1: They think and then they start to realize, wait a second,
Speaker 1: this wasn't exactly what we thought we were going to get. Yeah, exactly.
Speaker 1: So when he Trump and posted harffs two years ago,
Speaker 1: it was on the entire industry and developers and big
Speaker 1: farms were like, wait a minute, Like a lot of
Speaker 1: the US manufacturers focused greatly on rooftops, and we do
Speaker 1: these farms in the desert elsewhere in the country, and
Speaker 1: these panels are much bigger ones that they use. They're
Speaker 1: much heavier. You can have one person I couldn't do it,
Speaker 1: but one person bringing up the solar panel into a
Speaker 1: roof the once goes in the desert, you need two
Speaker 1: people will do it very very heavy. You're talking about
Speaker 1: American utilities, right, really needed access to these really really
Speaker 1: big panels. Well, yeah, they're gonna buy the solar power,
Speaker 1: yes they do, but it's it's developers these projects that
Speaker 1: do it on behalf or for these utilities in that case.
Speaker 1: Um So when this happened, like they these the industry, develops,
Speaker 1: these big farms said wait a minute, like this is
Speaker 1: attacking us. I think you have the wrong sort of
Speaker 1: culprit here. So they tried to go get an exemption,
Speaker 1: and they said, you should exempt all solar farms in
Speaker 1: this country. They got a no go on that. So
Speaker 1: I thought, how can we go in sort of craft
Speaker 1: and exemption to this policy that would help us but
Speaker 1: not hurt the overall policy. So they requested it's very,
Speaker 1: very complicated. So they requested an exemption on a certain
Speaker 1: kind of solar panel for big farms in the desert,
Speaker 1: not rooftop, a certain size, a certain amount of general
Speaker 1: electricity generated. And they fall for more than a year
Speaker 1: for this, and then Juno last year, out of nowhere,
Speaker 1: the administration says, wait a minute, will give us to you.
Speaker 1: But they gave a blanket exemption to all two sided
Speaker 1: solar panels that and which basically newter or like new.
Speaker 1: The gated a lot of the strength of the efficacy
Speaker 1: all the actual tariff, So get a little wonky. So
Speaker 1: it's supposed to be very narrow. Now, No, no, this
Speaker 1: is important I think, because right, this is what it's
Speaker 1: all about. But it was the biggest versions. I think
Speaker 1: they're called by facials, right, these two sided panels, so
Speaker 1: that's what they wanted, right, and which are used by
Speaker 1: utilities and others. And yet it became a much broader plan. Yeah,
Speaker 1: so you can do my facial on small ending. But
Speaker 1: like they wanted the exemption for larglarges, large and facial,
Speaker 1: and the exemption was for everything and doing so you
Speaker 1: could even use the two sided panels on the roof.
Speaker 1: You could do so theoretically, so you can then buy
Speaker 1: solar panels for any but you know, two sided for anything,
Speaker 1: and then to get around the tariffs. And that's Brian
Speaker 1: Eck how's chatting about the business of solar some of
Speaker 1: those unintended consequences. This is a smart story. Well, unintended consequences.
Speaker 1: Jason is so right on the money because I think
Speaker 1: we talk about trade, we use it in these broad
Speaker 1: macro terms, but it's complicated and there are a lot
Speaker 1: of moving parts. And when you go and strive for something,
Speaker 1: you think X, y Z is going to get done
Speaker 1: and then something completely outs gets done. You said something
Speaker 1: in motion, and you're not sure what the ramifications are
Speaker 1: going to be. The latest issue includes a strategy section, Jason,
Speaker 1: and it's all about kind of advice for people who
Speaker 1: are working maybe alone and groups don't have such a
Speaker 1: lovely part like we do every day to bounce things
Speaker 1: off of can you imagine we had to skype each
Speaker 1: other at the time. That's what folks are doing. They
Speaker 1: are doing that. Let's bring in someone who was involved
Speaker 1: in the section demitris um demitro. Good to have you here.
Speaker 1: So many people are working on their own and they
Speaker 1: need a little support. Yeah, I mean, we've got so
Speaker 1: many freelancers out there, right, or people working remotely. Maybe
Speaker 1: they work for a company, but they're far away. Um,
Speaker 1: And so they're handful startups that are catering to to
Speaker 1: you know, you might even be a PhD student writing
Speaker 1: your dissertation and you're a bit of a procrastinator, you know.
Speaker 1: I know you guys don't know too much about procrastination.
Speaker 1: I mean, because it's also like but um, so we
Speaker 1: write about these companies. They're kind of like these online
Speaker 1: work clubs and you log on and you find a
Speaker 1: work buddy and you can either go the focus mate route.
Speaker 1: That's one of the companies we write about, which is
Speaker 1: like fifty minute increments, quick quick quick, or you can
Speaker 1: really commit to like three point five hour work sessions
Speaker 1: with an online buddy so to beat you tell us
Speaker 1: how it works. I mean, this is literally like you
Speaker 1: and I would log in from our home offices like
Speaker 1: hang out. It's it's pretty simple and straightforward. I mean, basically,
Speaker 1: that's it. There's an idea behind it that a strong
Speaker 1: motivator is simply the presence of somebody else observing you
Speaker 1: while you're working or kind of aware of whether you're
Speaker 1: working or not. You know, if you're logged on and
Speaker 1: I'm your buddy on the other side of your computer screen,
Speaker 1: you know, if you decide to just walk away or
Speaker 1: stop working on that one, you know, memo, You've got
Speaker 1: a knock off in the next hour, I'll know it,
Speaker 1: and you know that I'll know it. So maybe you
Speaker 1: won't get up and walk away from your computer in
Speaker 1: that next hour and you'll actually get it. And maybe
Speaker 1: even just like showing up to your desk at eight
Speaker 1: am exactly because that other person is going to be
Speaker 1: there waiting for you doesn't work. I mean, you know,
Speaker 1: for the people that our reporter talked to it, they
Speaker 1: said that it really worked like beautifully. One guy that
Speaker 1: she interviewed who works remotely, has a has a part
Speaker 1: time permanent job but is remote and also runs his
Speaker 1: own business. This thing really regimented him. He logs on
Speaker 1: at eight am. You know, he gets a lot done.
Speaker 1: He's far more productive, and he ends in the afternoon
Speaker 1: earlier so that he can then, like you know, get
Speaker 1: to other tasks connected to the running of his business.
Speaker 1: Too expensive a month, It depends Focus, Yeah, it depends.
Speaker 1: I mean there are different price points for the two,
Speaker 1: you know, so UM cave d is a is a
Speaker 1: different format and that you can do it in person.
Speaker 1: They have spaces in Los Angeles and New York where
Speaker 1: you can actually show up, but there's is also one
Speaker 1: where you can log on and they're much more bigger commitment,
Speaker 1: more hours, more intense, maybe projects that you need people
Speaker 1: to help you sort of you know again find that motivation.
Speaker 1: So it sounds it sounds kind of like, wait, is
Speaker 1: this all it really takes? But in a way, it
Speaker 1: is all it really takes. I think we're going to
Speaker 1: see whether how much these work. They're very new outfits,
Speaker 1: UM a couple of Focus made His definitely attracted some
Speaker 1: funding that they shared with us um a million dollars
Speaker 1: so far, and cave Day has not revealed how much
Speaker 1: they've brought in. But I think that we're at the
Speaker 1: stage where we're going to start to see more interested
Speaker 1: in companies and outfits like that. And you guys do
Speaker 1: a nice job sort of putting this on a continuum,
Speaker 1: right in this sense of like we had offices, then
Speaker 1: we kind of dispersed in many ways, right like hacker spaces.
Speaker 1: Then we moved to the shared work spaces, right, and
Speaker 1: that gave rise to we work, and we see what
Speaker 1: that led to. Now there are a lot of these clubs.
Speaker 1: Clubs now like the Wing, and there are similar ones
Speaker 1: where you know you're maybe going to bring together a
Speaker 1: group of like minded people. The Wing is geared towards women.
Speaker 1: It does more than just bring you together to work.
Speaker 1: It does events and talks and so this is just
Speaker 1: another sort of evolution in this. We've got so many
Speaker 1: people out there working on their own who, whether they
Speaker 1: need support or ideas or people to brainstorm with or
Speaker 1: whatever it is, you know, can tap into these various
Speaker 1: resource We'll talk about these peer support groups because that's
Speaker 1: the other kind of layer that you guys get into.
Speaker 1: It's people who are stressed out, and you really get
Speaker 1: into kind of how you're feeling, how you're dealing with
Speaker 1: situations exactly, isn't your peers And there are there are
Speaker 1: companies and groups that are getting together seems to be
Speaker 1: happening a lot more in Silicon Valley in San Francisco. UM,
Speaker 1: and these are targeting a higher level executive I would say,
Speaker 1: so far. You know, there's sort of UM, the Next
Speaker 1: Generation Young President's Organization, Young Presidents Organization you might have
Speaker 1: heard of. It has been around for many, many, many decades,
Speaker 1: and in the last five or so years, maybe ten years,
Speaker 1: has really been trying to kind of become a little
Speaker 1: bit more current and deal with the digital age. But
Speaker 1: there are startups now in Silicon Valley and in San
Speaker 1: Francisco that are all about bringing you know, very under
Speaker 1: intense pressure, you know, founders of companies, CEO s UM
Speaker 1: together to really be among peers. So that's why I think,
Speaker 1: you know, it's attracting that level and to try as
Speaker 1: best they can to actually open themselves up and unload
Speaker 1: and talk about how they're really doing, how they're feeling,
Speaker 1: where they think the pressures are coming from. UM. There's
Speaker 1: so much that that I think really prevents people in
Speaker 1: those positions from doing that, sometimes time being a big factor, right, UM.
Speaker 1: And so these are organized as like dinners or in
Speaker 1: ways that also feel like maybe they're doing something else
Speaker 1: in addition to going and being among a group of
Speaker 1: peers and sharing their feelings. And one of the things
Speaker 1: you point out in that story is essentially that they're
Speaker 1: set up in such a way that if you're at
Speaker 1: it and you feel like you're just sort of networking,
Speaker 1: you're kind of doing it wrong, right. I mean, this
Speaker 1: is meant to establish relationships, maybe at a deeper level,
Speaker 1: and you give a nice anecdote about people, essentially saying
Speaker 1: how are you doing? No, really, how are you doing?
Speaker 1: You know, and this idea of you know, actually getting
Speaker 1: to know people. My favorite part I have to say
Speaker 1: of this section h is the humility quiz. And so
Speaker 1: you're gonna have to go back and listen to our
Speaker 1: daily radio show to see Carol and Me take it.
Speaker 1: But it has uh some pretty useful questions. Did you
Speaker 1: take it? Um? I took it. I'm not going to reveal,
Speaker 1: you know, how humble or not I am, but people
Speaker 1: should take a look at that humility is, you know,
Speaker 1: kind of a buzzy thing right now. I mean, there
Speaker 1: is real research, academic research research by groups um like Hogan,
Speaker 1: which we got this quiz from, that does personality assessments,
Speaker 1: that suggests that humility and being humble is a great
Speaker 1: quality for a leader, that these are people who don't
Speaker 1: want the spotlight and who are willing to give credit
Speaker 1: where credit is due. UM. I don't know how much
Speaker 1: of that we really have out there. You know, we
Speaker 1: have evolutions of the types of leaders we've wanted as
Speaker 1: the heads of our companies. Right if you think back
Speaker 1: to the seventies and the eighties and the types of
Speaker 1: CEOs that we had, and charisma and brash and really
Speaker 1: things that maybe shareholders or maybe more encouraged by UM,
Speaker 1: but that led to maybe a lot of promises that
Speaker 1: couldn't capped and risks. So now it's going the other
Speaker 1: way and it's saying you can be humble. That's Demitra
Speaker 1: Cassands and that's our strategy section this week. And I
Speaker 1: think it's so pertinent right now because Jason, more and
Speaker 1: more people are working at home on their own and
Speaker 1: they're getting a little lonely. So there are companies and
Speaker 1: apps to help you deal with that well and maybe
Speaker 1: a little less productive, and so they need someone to
Speaker 1: keep them on as someone literally on the other end
Speaker 1: of the basically like to you exactly get back to work.
Speaker 1: He became the majority owner of the Brooklyn Nets only
Speaker 1: last year, just before controversy that would threaten the NBA's
Speaker 1: relationship with its most important overseas market, China. Jason, We've
Speaker 1: talked so much about this, We've talked a lot about him,
Speaker 1: and he's only becoming more prominent. Previously prominent in the
Speaker 1: world of business, now very prominent in the world of sports.
Speaker 1: We're talking about Joe Sigh and we're talking with Ira
Speaker 1: Budway here in New York City. Phenomenal profile, incredibly timely.
Speaker 1: Take us back to October when this guy has to
Speaker 1: come out really for his first public statement as the
Speaker 1: majority owner of a major team amid a controversy, right,
Speaker 1: and it starts with, as people probably remember, the Darryl
Speaker 1: Morey tweet, the general manager of the Houston Rockets tweeting
Speaker 1: solidarity with the protesters in Hong Kong, deleting it. But
Speaker 1: the whole thing gets going, and Joe told me he
Speaker 1: was in his apartment in Hong Kong, uh and he
Speaker 1: gets a call from the NBA and they say, you know,
Speaker 1: this is an issue. There's already a lot of reaction
Speaker 1: on social media and the mainland China, like we're we're
Speaker 1: monitoring it, but this could be a thing. And he's
Speaker 1: in a great position right here. You think about someone
Speaker 1: who understands China. Great is relative great, It's been a
Speaker 1: very interesting position. What was he thinking at the time,
Speaker 1: And basically like, i am I have to say something.
Speaker 1: I you know, I'm Chinese, born in Taiwan, do business,
Speaker 1: live in Hong Kong, mid the protests. You know, own
Speaker 1: an NBA team, newest NBA owner, big market, do business
Speaker 1: in China. You know, I'm I'm And he's flying to
Speaker 1: Shanghai in a couple of days because the Nets are
Speaker 1: playing the Lakers there. So he basically felt like he
Speaker 1: had to come out and say something. And so he
Speaker 1: says something, and as with just about everything in this case,
Speaker 1: not everyone's happy with it, but what was ultimately the
Speaker 1: reaction and what was the effect on him and the team.
Speaker 1: So he comes out with this letter that he posted
Speaker 1: on Facebook that says, basically, everyone needs to understand how
Speaker 1: Chinese people are going to feel about this, and he
Speaker 1: basically sort of spoke for all of them, or it
Speaker 1: said he was speaking for all of them and said,
Speaker 1: you know, this is really a third rail issue there,
Speaker 1: we're talking about territorial integrity. And he couched the Hong
Speaker 1: Kong protests as a separatist movement, and that was the
Speaker 1: sort of controversial thing. That's the framing the Chinese government uses,
Speaker 1: not always the framing the protesters used. But he wanted
Speaker 1: to say, look, this is why this is so sensitive
Speaker 1: and delicate, and you've got to be careful. Um. And
Speaker 1: he says, basically, he got a lot of people saying, thanks,
Speaker 1: I didn't know this context. There were a lot of
Speaker 1: people were saying, look, you're just parenting the Chinese Party
Speaker 1: state line here um. And he, you know, he stuck
Speaker 1: by it. When I talked to him, he said, look,
Speaker 1: I really think it what it is a severatist moment
Speaker 1: if you look carefully, and so you know, and and
Speaker 1: it's unclear, you know, there are people who suggest, well,
Speaker 1: look he has to say that he can't alienate. He
Speaker 1: has a lot to lose, exactly. And so I put
Speaker 1: that to him and he said, no, I spoke my mind.
Speaker 1: That letters what I what I believe. And so remind
Speaker 1: us why he is as candidly, as powerful and rich
Speaker 1: as he is. This is a guy who came to
Speaker 1: this country, went to Yale, scraps his way onto the
Speaker 1: lacrosse team, I think, and then meet the guy named
Speaker 1: Jack Mob. I mean, it's an unbelievable story, a really
Speaker 1: remarkable story, and there's really you know, and talking to
Speaker 1: a lot of people. He knows a lot of people
Speaker 1: in very powerful people in the world, and they say
Speaker 1: there's really nobody like him in terms of that position
Speaker 1: that he occupies. So yeah, he born in Taiwan, comes
Speaker 1: to the US at age thirteen, goes to a prep
Speaker 1: school in New Jersey, you know, elite institution, and uh
Speaker 1: there he starts really quickly assimilating, learns English, loves play sports,
Speaker 1: plays lacrosse, plays football, goes to Yale, gets on the
Speaker 1: lacrosse team there. Uh, makes a ton of friends that way.
Speaker 1: Goes to law school at Yale, where his father had
Speaker 1: gone was the first Taiwan He's graduate from Yale Law
Speaker 1: and then works his way along. He's at a shop
Speaker 1: called Investor a B looking for private equity deals in
Speaker 1: Asia based out of Hong Kong. Somebody says, hey, you
Speaker 1: should look up this guy, Jack Mab. This is right
Speaker 1: after that they basically started Ali Bab. But he goes
Speaker 1: to meet him and says, I want to throw in
Speaker 1: my lot with this guy. And the rest you know
Speaker 1: its history, but he became the sort of the bridge
Speaker 1: to the US and the West for Ali Bab well.
Speaker 1: And in many ways that's a really important point to emphasize,
Speaker 1: because Jack mas this larger than life character, you know,
Speaker 1: so sort of out there being in a lot of ways,
Speaker 1: Joe seems to be the guy who goes into the boardrooms,
Speaker 1: talks to the private equity guys, to venture capitalist, to
Speaker 1: Wall Street, to anybody. He really smoothed the way in
Speaker 1: many ways for what Ali Baba becomes, right, And that's
Speaker 1: what Jack Mots told me when I talked to him
Speaker 1: about it. He said, you know this, there were times
Speaker 1: where I'd be in a room with a bunch of
Speaker 1: finance types and Jack calls himself street guy in the US,
Speaker 1: and I make them all upset with something I said,
Speaker 1: and then Joe would smooth it over um. And that
Speaker 1: that was he relied on him to translate personally the
Speaker 1: annual letters that he would write to shareholders in the world.
Speaker 1: Joe was the one who took Jack's vision and said,
Speaker 1: this is what I know what you mean, and I'm
Speaker 1: going to make sure everyone outside knows what you mean too.
Speaker 1: And that's Ira boot Away. He's got a couple stories
Speaker 1: in the magazine this week, once about gambling. This one
Speaker 1: is about a guy who made a pretty good bet
Speaker 1: on buying an NBA team. Yeah, he did make a
Speaker 1: good bet, but talk about his timing because he became
Speaker 1: the majority owner, as we heard from Ira just before
Speaker 1: that controversy that really um put to test the NBA's
Speaker 1: relationship with China. This is a huge market for them,
Speaker 1: an important market. It is in many ways the future.
Speaker 1: And Josiah sitting at this great intersection of kind of
Speaker 1: understanding East and West, well exactly. We often say someone
Speaker 1: is uniquely positioned. He really is uniquely positioned in this case,
Speaker 1: with some two D venues including cafes, hotels, casinos, live
Speaker 1: music and the rock Shop, and within seventies six countries,
Speaker 1: Hard Rock International is also Jason going to be on
Speaker 1: everyone's radar for the Big game. First, of course, because
Speaker 1: the Super Bowl is gonna be played in hard rock Stadium, right,
Speaker 1: and there's gonna be a big ad and it's gonna
Speaker 1: be one I predict that we're gonna be talking about
Speaker 1: in part because one of the Stars is j Lo.
Speaker 1: She's also performing at the Big Game. Jim Allen is
Speaker 1: here with us, back with us, I should say, great
Speaker 1: to see you. A big week obviously for the whole
Speaker 1: enterprise in a lot of ways. Tell us what this
Speaker 1: means for the company. Oh amazingly excited about obviously Super
Speaker 1: Bowl Week and having a commercial you know, as part
Speaker 1: of the halftime festivities for a Super Bowl the hundred
Speaker 1: year anniversary of the NFL at hard Rock Stadium. So
Speaker 1: tell us about why. I mean, you guys have not
Speaker 1: done right and add at the Super Bowl, So why
Speaker 1: why is now the right time? You know? It all
Speaker 1: kind of came together with the opening of the world's
Speaker 1: first guitar shaped hotel, the hundred year anniversary of the
Speaker 1: NFL Hard Rock Stadium, and it just seemed like, if
Speaker 1: we're going to be involved, you know, let's get involved
Speaker 1: on a big time basis. But Jamal and tell us
Speaker 1: about the Super Bowl audience. What is it about that
Speaker 1: audience that you know, man, this is a place you
Speaker 1: want to run an ad. The most watched event in
Speaker 1: the world, over a hundred million people see this particular
Speaker 1: event that's just on the TV broadcast itself. When you
Speaker 1: look at them online. It certainly creates a lot more
Speaker 1: media impressions, you know, for a global basis for the
Speaker 1: hard rock brand, and that's something we're very excited about.
Speaker 1: So tell us what you can about the ad. Obviously
Speaker 1: want to leave some for this, everything you can about
Speaker 1: the ad because because of that audience people, as you know,
Speaker 1: and I know we know some of them, there are
Speaker 1: people who tune in just for the ads. They don't
Speaker 1: even care about the game. So the stakes are high,
Speaker 1: as they in your business. Well, we didn't want it
Speaker 1: just to be a spot about the brand, so we
Speaker 1: kind of created this storyline. Obviously, hiring a director and
Speaker 1: producer like Michael Bay speaks for itself that we're committed
Speaker 1: here long term. So the spot is almost like a
Speaker 1: mini story that then eventually takes you to our websites,
Speaker 1: our relationship with j Low and frankly creates, you know,
Speaker 1: the introduction to the two million dollar sweepstakes, which will
Speaker 1: be announcing. So Michael Bay, so is it going to
Speaker 1: have like an Armageddon Transformers kind of feel? We'll have
Speaker 1: a Hollywood feel, I promise you that. Did you guys
Speaker 1: really spend about five point six million to make this commercial. Well,
Speaker 1: give us an idea. Well, I could say we're north
Speaker 1: of ten million all in. Wow, was that a hard
Speaker 1: check to write? Well, frankly, the spots themselves, you know,
Speaker 1: are approaching that, and you know, Kennily were well north
Speaker 1: of ten million all in. And so Michael Bay tell
Speaker 1: us how he gets the nod? He lives in Miami,
Speaker 1: I think, and so he's got some connections here. Well,
Speaker 1: I think we wanted to create something that special, right,
Speaker 1: and not just because of all the amazing movies that
Speaker 1: he's directed, but also did a lot of music videos,
Speaker 1: so he certainly understands the brand. Certainly being in Miami
Speaker 1: made it a little bit easier as far as proximity,
Speaker 1: you know, to the guitar shaped hotel. But franularly, we
Speaker 1: did look at some other candidates and he by far
Speaker 1: was the one we were hoping for and when he
Speaker 1: said yes, we were certainly very excited. Yeah, it's really
Speaker 1: cool to have him and I can't imagine how which
Speaker 1: fun it was to work with him. What is this
Speaker 1: a bet on um, Jim? Is it a bet on
Speaker 1: the hotel business? Is it on online gaming, which you
Speaker 1: guys have been moving certainly aggressively into what what is
Speaker 1: it about for you? What do you hope to get
Speaker 1: out of it? Well? I think the hard Rock brand, um,
Speaker 1: we know that, you know, coming up on our fifty
Speaker 1: year anniversary, is one of the most recognized brands in
Speaker 1: the world. But we want to continue to position as
Speaker 1: a brand of entertainment. And obviously the Super Bowl is
Speaker 1: much more than a football game. It's about entertainment when
Speaker 1: you think about people coming together in houses and all
Speaker 1: the different things they do. So being part of this
Speaker 1: was something that was very important for me to position
Speaker 1: hard Rock is not just a brand of hospitality but
Speaker 1: a brand of entertainment. But what do you hope that
Speaker 1: in terms of people say, oh, hard Walk, I didn't
Speaker 1: know that they I forgot that they're doing this, or
Speaker 1: they're doing this. Well, we are certainly hopeful that will
Speaker 1: drive some foot traffic to all the locations on a
Speaker 1: global basis. But you know, I don't think it's about
Speaker 1: quote unquote internet gambling. I think it's more about the
Speaker 1: brand itself, which obviously has many different sectors that we're
Speaker 1: looking for additional foot traffic to come to our facilities,
Speaker 1: both in person and then certainly online through through the
Speaker 1: online retail, we're Internet gaming, etcetera. All right, so speaking
Speaker 1: of foot traffic and eyeballs, a lot of people are
Speaker 1: gonna be walking in and watching a game that's held
Speaker 1: in the stadium that you named. You paid, I believe
Speaker 1: fifty million dollars for the for the naming rights, no
Speaker 1: small chunk of change. What was the obviously this is
Speaker 1: going back a little bit, but what was the thinking
Speaker 1: behind putting your name on that particular stadium? You know,
Speaker 1: we have been approached about this many times, and um,
Speaker 1: we looked at it and we said no, probably not
Speaker 1: for us, because we were concerned in different cities you're
Speaker 1: talking about, well, frankly in many cities, but specifically in
Speaker 1: al Florida. Um. And once we understood that Mr Ross,
Speaker 1: Steve Ross, who's the owner of the Miami Dolphins and
Speaker 1: the actual physical structure itself, was committed to really create
Speaker 1: something that was more than just a football stadium. That
Speaker 1: piqued my interest. And you know, Steve would say that
Speaker 1: it was rather interesting, you know, back and forth between
Speaker 1: him and myself, but we were really excited when we
Speaker 1: saw he wanted to do things other than just football.
Speaker 1: So whether it's the rolling Stones, you know, with their
Speaker 1: last show there Beyonce, A jay Z, you too, Formula One,
Speaker 1: you know, the Miami Open moving you know obviously from
Speaker 1: Biscayne nowt to hard Rock Stadium. It's really an entertainment destination.
Speaker 1: And once we were convinced that was going to be
Speaker 1: part of the script, not just the football, very very excited.
Speaker 1: So tell us a little bit about that back and
Speaker 1: forth if you can. We know Steven Ross, well, he's
Speaker 1: tough businessman. You're a tough businessman. So what were you
Speaker 1: really sort of haggling over at the end of the day.
Speaker 1: I don't know if it was haggling, but I think
Speaker 1: it was more about making sure that we understood what
Speaker 1: the entertainment commitment was going to be obviously then tying
Speaker 1: that back to the actual dollars so shade it with
Speaker 1: the sponsorship, and the most importantly, we did not want
Speaker 1: to do this on a short term basis. We were
Speaker 1: in and we were all in um or. We didn't
Speaker 1: want to end up in a situation where we've got
Speaker 1: a five year sponsorship and then hypothetically the name changes
Speaker 1: a guy. So you know, people are going to know
Speaker 1: hard Rock Stadium for the next you know, well, actually,
Speaker 1: We're already three years into the deal for the next
Speaker 1: seventeen years, and that was very important to us. So
Speaker 1: what does it mean for the future stadium? I do
Speaker 1: feel like there's more challenges for people time, new fans,
Speaker 1: younger fans, They want a different type of experience. So
Speaker 1: what does it mean for you guys in terms of
Speaker 1: what you'll be doing with that stadium going forward? Twenty
Speaker 1: years commitment, that's a long time, So what's the future.
Speaker 1: But you know, I think like in any physical building,
Speaker 1: you know, there's always a conversation about reinvesting in Capex
Speaker 1: and if we look at Steve's incredible success, you know,
Speaker 1: look at the Hudson Yards here. I mean, obviously he
Speaker 1: and his companies have a long track record at continuing
Speaker 1: to reinvest to create a world class product. So frankly,
Speaker 1: that was something that was very important to me um
Speaker 1: which we believe that the same will continue at hard
Speaker 1: Rock Stadium as we move forward. Even if you look
Speaker 1: at what's happened since we actually signed the deal, we
Speaker 1: certainly knew that Super Bowls were a strong possibility. Nothing
Speaker 1: is guaranteed because obviously the NFL has to approve that,
Speaker 1: but it was very clear in the contract which the
Speaker 1: NFL was aware of, that if a Super Bowl occurs,
Speaker 1: then certain financial and economic things may or may not happen.
Speaker 1: With the relationship between Mr Ross and ourselves, we believe
Speaker 1: the same will happen as we continue to, you know,
Speaker 1: grow the partnership on a long term basis. And do
Speaker 1: you have any sense of how many super Bowls? I mean,
Speaker 1: obviously they don't go too far out, but I mean
Speaker 1: you could get multiple in uh, in that period of time. Well,
Speaker 1: first of all, there's been more Super Bowls in South
Speaker 1: Florida than anywhere else in the United States. UM, it's
Speaker 1: just such the it's such an ideal place for the
Speaker 1: Super Bowl because obviously Miami is an international gateway city,
Speaker 1: tremendous amount of hotel rooms. You don't have to bring
Speaker 1: in cruise ships to try to put people for a
Speaker 1: place to stay. UM, the Guitar Hotel, all the amenities
Speaker 1: that we offer at at hard Rock. We just think
Speaker 1: it's a natural. So we're very hopeful that many more
Speaker 1: will come in the future. So what about some of
Speaker 1: the other proper reason I'm thinking about Atlantic City. I've
Speaker 1: spent some time down there talking to UM, your team
Speaker 1: and other folks. Um, you were pretty critical about what's
Speaker 1: going on in Atlantic City recently in terms of the
Speaker 1: city itself, the safety. Um, first of all, tell us
Speaker 1: how the property is doing. Property is doing very well.
Speaker 1: You know, first year of first full year of operation
Speaker 1: actually rose to number two in the marketplace in gross
Speaker 1: gaming revenue. So that's something that we were very proud of.
Speaker 1: When you look at the amazing brands like Harrison Caesar's
Speaker 1: Tropicanical Nugget that have been there. You know, She's been
Speaker 1: there for over fourty years, so um, huge database. You know,
Speaker 1: to go up and compete against that in the first
Speaker 1: year to get to number two is very important. Jim,
Speaker 1: Is it a different type of individual who's coming to
Speaker 1: hard rock down Atlantic City versus in the past. No doubt.
Speaker 1: We certainly focused on entertainment, you know Live three. I
Speaker 1: mean that was really about creating and not just music, right,
Speaker 1: So whether it's comedy with Harry Mendel, whether it's with
Speaker 1: the need Lander family with all the Broadway shows we're doing,
Speaker 1: and frankly really exceeded our expectations. I think it's a
Speaker 1: real compliment to the hard rock brand, the knee Lander family,
Speaker 1: but frankly, Atlantic city because the numbers we did with
Speaker 1: Jersey Boys, we're really really strong. So now we're going
Speaker 1: to do four Broadway series this upcoming season. As far
Speaker 1: as the town itself, it's not that we feel it's
Speaker 1: quote unquote unsafe. We just feel as though that trenton
Speaker 1: the c r d A. You know, unfortunately, that mayor
Speaker 1: was arrested again. You know, we've seen this so many times.
Speaker 1: Now is the time to come together to say, Look,
Speaker 1: we've had a company like hard Rock invest over five
Speaker 1: hundred million dollars. Let's live up to what we said
Speaker 1: we're going to do to take the next step together.
Speaker 1: You did tell a p you said, frankly, the town's
Speaker 1: and we're shaped today than it was when we bought
Speaker 1: the building. When you're in a resort environment where safety
Speaker 1: and security is so important, if the city can't get
Speaker 1: something fixed as simple as the street lighting, that maybe
Speaker 1: a change is needed. I mean frustrating. Yeah, So that
Speaker 1: and and specifically street lights. You would think that the
Speaker 1: local municipality would be handled that. And if they don't
Speaker 1: understand that, if you don't keep up with street lights,
Speaker 1: then safety can become an issue. But to be fair,
Speaker 1: we haven't seen crime issues at hard Rock at all
Speaker 1: to be fair to the city, but frankly, if you
Speaker 1: don't fix the street lights, you're going to have crime.
Speaker 1: That's Jim l and the chairman and CEO of hard
Speaker 1: Rock International. Man. Their organization is huge in terms of hotels, cafes,
Speaker 1: of course the stadium. They're in seventy six countries. So
Speaker 1: fun to talk about the big game with him, but
Speaker 1: also get his perspective on the global economy. Absolutely. I mean,
Speaker 1: he really is at the center of so many things
Speaker 1: in every twist and turn of the global economy, he's
Speaker 1: got to have a take on and we did catch
Speaker 1: up with him for quite a bit of time here
Speaker 1: at headquarters. It's a wide ranging conversation. You can check
Speaker 1: that out via podcast. It's this Week's Business Week Extra,
Speaker 1: once the go to destination for Chinese mainland shoppers. The
Speaker 1: anti Beijing protests in Hong Kong. While they have definitely dimmed,
Speaker 1: it's a lord Jason Well. It's been a huge shock
Speaker 1: to the system in many ways because people aren't showing
Speaker 1: up to shop and it's starting to really play through
Speaker 1: the retail scene there. Jim Ellis oversees all the business
Speaker 1: coverage for the magazine. He's here with us. Tell us
Speaker 1: about teal, especially luxury retail in Hong Kong. Well, one
Speaker 1: of the things that's always marked Hong Kong is that
Speaker 1: it's been the shopping or it was the shopping mecca
Speaker 1: of you know, China and of Asia. And but what
Speaker 1: a lot of people didn't realize was that a big
Speaker 1: boost for Hong Kong came from the ability of mainland
Speaker 1: Chinese to sort of go there and do their shopping.
Speaker 1: It was their mall basically, and that was great for
Speaker 1: the last twenty years. The problem is now more and
Speaker 1: more of the shoppers who need to come to Hong
Speaker 1: Kong are starting to worry about coming there. I mean,
Speaker 1: the protests have been very difficult for Hong Kong. Big
Speaker 1: reason is that a lot of Mainlanders feel that the
Speaker 1: a that it's dangerous be that you know, people who
Speaker 1: live in Hong Kong are unpatriotic and are very anti Chinese,
Speaker 1: and therefore they're like, why should we go and give
Speaker 1: our money these people who don't even want to be
Speaker 1: part of us. Well, it is dangerous, right, there's reports
Speaker 1: of various mainland Chinese being beaten up. Right, So there
Speaker 1: have been pressure sports but also the government has been
Speaker 1: encouraging those press reports and so um, it's all government. Yes,
Speaker 1: it's all part of a of a of a way
Speaker 1: to show that you know, right now, Hong Kong is
Speaker 1: an outlier and China, the rest of China is a
Speaker 1: sort of patriotic type. Having said that, though Jim like
Speaker 1: some of the numbers, I was kind of I kept
Speaker 1: writing on my notes, Wow statistics in terms of how
Speaker 1: much retail sales, high end luxury retail sales are down
Speaker 1: in the well. One of the reasons is that because
Speaker 1: Mainlanders account for so much of the tourism to Hong Kong,
Speaker 1: it's I mean, a lot of people think people from
Speaker 1: all over the world are coming in there, but eight
Speaker 1: of the travelers to Hong Kong are from China, and
Speaker 1: a lot of them are high end, high end shoppers
Speaker 1: who go there to shop at Gucci, go there to
Speaker 1: shop at you know, the LBMG. The problem is that
Speaker 1: they'll come in and spend a lot of money and
Speaker 1: then go home. Now two things have happened. One is
Speaker 1: lots and lots of retails are opening up in cities
Speaker 1: across China, and now you can shop at luxury retailers
Speaker 1: in Shanghai, in Beijing and guan Jou, you don't have
Speaker 1: to make that trip. The second thing is that Hong
Speaker 1: Kong always benefited from being the air hub that all
Speaker 1: rich people are business people had to go through to
Speaker 1: get in and out of China. That's faded. The government
Speaker 1: owns three airlines and they have set up three hubs
Speaker 1: in other cities across China, and so what happens is
Speaker 1: that nowadays high end shoppers don't have to go through there.
Speaker 1: So there has to be a reason for them to
Speaker 1: go to Hong Kong. And it might be because there's
Speaker 1: more restaurants is or whatever. And now with the trouble
Speaker 1: from the protests, they're not even doing that. So therefore
Speaker 1: you have these huge drops. I mean, so retail sales
Speaker 1: have dropped in a single month in November, they dropped
Speaker 1: by and in the high end goods like watches and
Speaker 1: things like that is over fifty. Now that's started shocking.
Speaker 1: It's hard to imagine half of your business sort of
Speaker 1: going away overnight, but that's what's half sing there well,
Speaker 1: and it's leading to stores shutting down, I mean, and
Speaker 1: not just one here, one there, but you know, dozens
Speaker 1: of locations for certain stores. Yeah, well overall, and this
Speaker 1: includes high end and low end, and a lot of
Speaker 1: this is um sort of low end stores. But four
Speaker 1: hundred stores closed in Hong Kong in the last six months.
Speaker 1: But then there have been some high end names. You
Speaker 1: sort of think that, you know that cohort will continue
Speaker 1: to shop, but um Louis Buitama is closing a store,
Speaker 1: products closing a store. Lots of people are saying that
Speaker 1: this business may not be coming back, simply because even
Speaker 1: at the protests end, you know the damage has been
Speaker 1: done reputationally and you can shop closer to home, plus
Speaker 1: you can shop online. So what are you hearing in
Speaker 1: terms of, you know, the expectation of Hong Kong is
Speaker 1: a tourist destination. Does it just go away? I mean,
Speaker 1: I know the mainland Chinese are very important, but overall,
Speaker 1: will people start going stop going? It doesn't go away.
Speaker 1: It just becomes less of a shopping only destination. It
Speaker 1: has the advantage of having mountains, it has beaches, it
Speaker 1: has Disneyland, it has all sorts of other attractions that
Speaker 1: hadn't been pushed, you know. And so what happens is
Speaker 1: it becomes as someone in the story says it has
Speaker 1: become a more holistic travel destination. It can't be just
Speaker 1: the place that becomes China's mall. Kind of a reminder
Speaker 1: to that economy, right, that they can't just be about
Speaker 1: high end shopping. Yeah, absolutely, really interesting story, a look
Speaker 1: at something that we all can understand because that shopping
Speaker 1: element crucial to the economy. Jim, thanks, thank you. And
Speaker 1: that's Jim Ellis, business editor for Business Week. He has
Speaker 1: spent a lot of time in Asia. He understands that
Speaker 1: market really well. And wow, so much going on in
Speaker 1: Hong Kong well, and you have to wonder these workers
Speaker 1: that are being hit so hard there at the lower
Speaker 1: end of you know, the economy in Hong Kong not
Speaker 1: making a lot of money. If they leave, will they
Speaker 1: ultimately come back when things improve? So we'll have to
Speaker 1: see what happens. The reality, sales have never been better
Speaker 1: on Palm Beach, apparently, Jason, except for a cluster of
Speaker 1: home we're talking about the Barrier Island right there off
Speaker 1: the coast of Florida. The president, his primary resident, President Trump,
Speaker 1: mar Lago we're talking about, and yet there's a cluster
Speaker 1: of homes right around mar Largo. There for sale, but
Speaker 1: nobody's snapping them up. What's going on? James Tarmy headed
Speaker 1: down their tough assignment this time of year at the
Speaker 1: head to Palm Beach. But he's gotta do it, gotta
Speaker 1: go down there, spend some times. I am willing to
Speaker 1: take on the hard one for the team. Won't stop.
Speaker 1: Remind everybody, I mean, we know Palm Beach. It's where
Speaker 1: a lot of financial types live. Um incredible homes. Well,
Speaker 1: they don't live there, they have homes where Carol is correct.
Speaker 1: They now all live there because of the extremely generous
Speaker 1: zero percent personal income TAXT. So a lot of people
Speaker 1: do live in Palm Beach. Um. It's this very surreal
Speaker 1: place because it's incredibly sin most of the time, there's
Speaker 1: no more than two or three lots deep between the
Speaker 1: bay side and the ocean side. It's and everything has
Speaker 1: hedges in their palm trees, and everything is pristine, and
Speaker 1: people look like you would imagine that they look and
Speaker 1: dress like they would imagine in your dress, and it's
Speaker 1: and so forth. And it's expensive real estate. It is
Speaker 1: very expensive, and it has only gotten more expensive this
Speaker 1: year where it has been white hot um three homes
Speaker 1: last year sold for approximately a hundred million dollars apiece.
Speaker 1: Um but yes, a piece, a piece, Oh my god. Yes,
Speaker 1: So the it's it's really flying off the shelves, empty lots,
Speaker 1: tear downs, mansions, everything in between. Everyone is buying, is
Speaker 1: the answer. People from all over the country are buying,
Speaker 1: but also people within Palm Beach or trading up and
Speaker 1: treading down. And it's very much this kind of weird
Speaker 1: microcosm where real estate is constantly being changed hands, and
Speaker 1: so within listen to ecosystem. There is around mar Lago,
Speaker 1: which is this former estate for Marjorie Merry with their post.
Speaker 1: It's this colossal piece of property and pong beage that
Speaker 1: cuts bisects the entire island. Um. So around this estate
Speaker 1: there are a cluster of unsold houses. Some have been
Speaker 1: on the market for years, some are just coming onto
Speaker 1: the market. But it's a crazy anomaly. Things like this
Speaker 1: don't usually happen, and so the question is why. And
Speaker 1: you have at least a couple of people saying nothing
Speaker 1: to see here, move along, is just a coincidence. And
Speaker 1: yet and yet, so what did you find when you
Speaker 1: went down there? What are the consistencies among the properties,
Speaker 1: What did you take away. So this to give some context,
Speaker 1: there is something that's called Billionaires Row, which is directly
Speaker 1: south of mar Lago, and that is where, if you
Speaker 1: can believe it, there are a lot of billionaires. Directly
Speaker 1: north of Mara Lago is the estate section. These are
Speaker 1: all Realist eight fabrications, yes, but they are in whatever
Speaker 1: way reflective of the fact that homes are oftentimes in
Speaker 1: and around Moral Lago around five to twenty million dollars right,
Speaker 1: not cheaper. This is not a cheap place to live.
Speaker 1: And what's striking is that there's a tremendous amount of
Speaker 1: new construction. There's a tremendous amount of recently renovated buildings,
Speaker 1: and they are all for sale and they are not selling.
Speaker 1: And so I talked to a variety of brokers. Um,
Speaker 1: everyone had different solutions, everyone had different diagnoses. Um. The
Speaker 1: one thing that everyone agreed on was that it had
Speaker 1: absolutely nothing to do with Donald Trump, who they all
Speaker 1: referred to as he as and when he is on
Speaker 1: the island. No one refers to Trump by Trump's names.
Speaker 1: It's eight like he his with a capital age and
Speaker 1: tell us about Moral Argae. You went there, Um, yeah,
Speaker 1: we see it in pictures. We hear about it all
Speaker 1: the time. President talks about it quite a bit. What
Speaker 1: was the vibe. I would say that the vibe was
Speaker 1: extremely relaxed, extremely friendly, um and extremely desolate everyone. This
Speaker 1: is the high season right now, yes, And I sort
Speaker 1: of assumed that it would be kind of bustling place,
Speaker 1: especially in December leading up to Christmas, which is when
Speaker 1: a lot of people are down there. Um, And I
Speaker 1: didn't see much bustle. To be fair, I was there
Speaker 1: during breakfast. Maybe it gets hopping in the evenings maybe,
Speaker 1: but I was there at eleven. He did sleep one guilty,
Speaker 1: But it's it's really Everything is kind of very carefully manicured.
Speaker 1: The staff is super genial. There is a picture of
Speaker 1: Dollnerald Trump in the men's bathroom. Um, all fun facts,
Speaker 1: but and and the trash cans even have little kind
Speaker 1: of golden feet. Everything is as you would imagine it.
Speaker 1: But it's not this kind of place of outsize that
Speaker 1: reflects the outside lord of this associated with it. Right. Well,
Speaker 1: you were surprised to just how easy it was to
Speaker 1: get in, right. I think you assumed that there would
Speaker 1: be a lot of security. There was none. And you
Speaker 1: know this actually led some level of credence to what
Speaker 1: all the brokers were saying, which is that you know,
Speaker 1: many people have talked about in publicly about the inconveniences
Speaker 1: associated with Trump's presence um and how there's traffic delays
Speaker 1: and how the Secret Service screw everything up for everyone,
Speaker 1: but everyone actually there was like, it's really no big
Speaker 1: deal and experiencing it in a microcosm. Of course, Donald
Speaker 1: Trump is not there. When I was there, um, it
Speaker 1: really wasn't a big deal. And it was actually, I
Speaker 1: would say, mildly shocking how easy it was to kind
Speaker 1: of get in and out and how little anyone cared
Speaker 1: about me. And to be fair, the President wasn't there,
Speaker 1: so it wasn't sort of locked down as if it
Speaker 1: probably would if he was there. One thing I thought
Speaker 1: was interesting, and I will highly recommend that folks check
Speaker 1: this out online in the magazine because the properties, Like
Speaker 1: I had so much fun just kind of reading through
Speaker 1: the specifics. But some of the homes that because of
Speaker 1: the proximity to Morrow Lago, they waived the initiation fee
Speaker 1: right to the club. You don't have to pay annual
Speaker 1: dues and other things, but that's part of buying some
Speaker 1: of these properties. So there is an adjacent road called Woodbridge.
Speaker 1: And when Trump bought the property in the nineties, he
Speaker 1: had to convince residents that it was something that they
Speaker 1: should get behind and not try to block in town
Speaker 1: councils and so forth. Um to turn this property into
Speaker 1: a private club. And the way that he sort of
Speaker 1: greased the wheel was anyone who lives on Woodbridge if
Speaker 1: their initiation fee, which is now I believe over two dollars,
Speaker 1: it's waved. And it's also your grandfather in So anyone
Speaker 1: who owns a house on Woodbridge gets to be a
Speaker 1: member at marl Lago. But when you sell the house
Speaker 1: on Woodbridge, you rescind that membership. So it's it's a
Speaker 1: really sweet part of the package so long as you're there.
Speaker 1: And that's James Tarmy. I mean, anytime we sit down
Speaker 1: with him, we have a blast. He talked about his
Speaker 1: time down there, looking at the homes, getting into and
Speaker 1: walking around more Lago specifically. But it is fascinating that
Speaker 1: this is a real estate market where there aren't a
Speaker 1: ton of homes. They're in demand typically, except there are
Speaker 1: a few that are kind of sitting out there not selling. Yeah,
Speaker 1: it's a really interesting conversation real estate. It's more complicated
Speaker 1: maybe than you think. It's been two years since the
Speaker 1: Supreme Court ruling that opened up the gambling industry outside
Speaker 1: of Nevada, and in one of this week's feature stories
Speaker 1: are Budwei, Well, he actually became a gambler, a degenerate gambler.
Speaker 1: It feels like depending on who you are, you know,
Speaker 1: not doing the things he needs to do around the
Speaker 1: house because he's so focused on the line. He joins
Speaker 1: this here in New York City. So this is quite
Speaker 1: an experiment. Bloomberg funded, Bloomberg approved. We should point out
Speaker 1: why and how did you do this? Well, we had
Speaker 1: seen the new handicapping service tout they call it, which
Speaker 1: is somebody who tells you what to bet uh, and
Speaker 1: frequently they do that for a feet And there was
Speaker 1: this new one started by a former Major League pitcher
Speaker 1: named Michael Swimmer who said, this is going to be legit.
Speaker 1: Like touts in general don't have a great reputation, a
Speaker 1: lot of scam artists out there. He said, we're gonna
Speaker 1: do this for real. I've got twenty three million backing,
Speaker 1: I've got Bill Miller, Wall Street money. We're gonna publish
Speaker 1: our picks. We're gonna give refunds if it doesn't pan out.
Speaker 1: This is gonna be like the real deal. And I said, well,
Speaker 1: let's let's see. Let's try it out. So I spent
Speaker 1: a week in New Jersey, where you can bet legally,
Speaker 1: bought a week long package of his picks, the company's
Speaker 1: jambos and uh, and gave it a shot. How does
Speaker 1: it work? Give us an idea of what it costs
Speaker 1: and your experience. Yeah, so I did the smallest package,
Speaker 1: two fifty dollars for a week. You can spend a
Speaker 1: lot more, three thousand dollars for seventeen weeks if you
Speaker 1: want um. And they send picks. They alert you every
Speaker 1: day about eleven am. That day's picks really depends. Could
Speaker 1: be five, could be could be forty. Uh. And you
Speaker 1: try to hustle out and find a bookmaker who will
Speaker 1: give you the bet there they're saying you should take,
Speaker 1: and they've they've checked. They have their sort of bookkeeper
Speaker 1: of record, their book of record that they say this
Speaker 1: bets available. But that stuff moves, as I discovered really quickly.
Speaker 1: So I was, you know, okay, let me get on draftkicks, right,
Speaker 1: sometimes you don't want to make the bet anymore. Right.
Speaker 1: So that's the issue for basically every handicapper is the
Speaker 1: better you are, the faster the market moves, and the
Speaker 1: harder is for anyone to use your advice. And that
Speaker 1: was ultimately what you discovered is that this company was
Speaker 1: quite literally the victim of its own success. It almost
Speaker 1: it feels like spoiler alert, almost like put itself out
Speaker 1: of business. Yeah, I mean there's a couple of ways.
Speaker 1: I mean that's sort of their version. Events. So they said,
Speaker 1: as I was doing this experiment, they said, we're gonna
Speaker 1: stop selling picks at the Super Bowl. And their explanation
Speaker 1: is lines are moving so quickly after we put out
Speaker 1: our pick. In other words, betters and and bookmakers are
Speaker 1: responding to our picks making right the fluid markets. They're
Speaker 1: not the same at every bookmaker. Uh, and so this
Speaker 1: is no longer working customers. And I saw some of
Speaker 1: that myself. There were a lot of bets I couldn't get,
Speaker 1: Like I got a hundred and eleven picks I wanted
Speaker 1: betting like seventy five of them. Um. But there's it's
Speaker 1: also possible that you know this service what just wasn't
Speaker 1: just wasn't standing out right that the picks were not
Speaker 1: so valuable. They just weren't that valuable, right, So it's
Speaker 1: hard to say exactly why. But they're saying, look, we're
Speaker 1: not going to sell anymore, we have different business plans
Speaker 1: from coming out with new things in the future. Did
Speaker 1: you make money? I did, but by sheer luck. So
Speaker 1: those bets that I didn't get to make out of
Speaker 1: that a hundred and eleven on mostly losers. Just so
Speaker 1: the company's picks for that hundred eleven period down, and
Speaker 1: and a better who had been able to get every
Speaker 1: bed in would have lost. I was lucky the best
Speaker 1: I didn't get in losers, so I finished up about
Speaker 1: sixty dollars. Yeah. So, I mean, you know the businesses
Speaker 1: sports so well, and you understand so many of the
Speaker 1: inputs as it were, around how people are consuming sports,
Speaker 1: you know. But you and I were talking before we
Speaker 1: came on set about a great story you did last
Speaker 1: year about John Skipper and the zone into every things
Speaker 1: changing around the business of sports. And yet this feels
Speaker 1: like it's right in the center of all of those things.
Speaker 1: Two years on is Carroll said at the top, like,
Speaker 1: what do you make of sort of the legal sports
Speaker 1: betting scene. I mean it's it's growing fast. I think
Speaker 1: the money is in there for operators. So we've seen
Speaker 1: fifteen billion dollars in bets in legal markets since the ruling.
Speaker 1: May the draft kings and give us perspective, it's not
Speaker 1: when you've got to remember that money wagered is not
Speaker 1: revenue for the book, right, So the revenue for the
Speaker 1: book is a small fractah, So it's not a huge
Speaker 1: industry yet, but it's growing fast um, and as more
Speaker 1: states come in, I think you're going to see an
Speaker 1: effect of that momentum once you get sort of more
Speaker 1: than half of the US population, than big national companies
Speaker 1: are gonna say this is effectively a national market and
Speaker 1: get in there well. And also you've had Professional League
Speaker 1: sort of tiptoe into this a little bit, right, and
Speaker 1: obviously there there could be a tipping point there where
Speaker 1: they are more open to the idea that this is happening.
Speaker 1: They basically have already flipped. They're saying, we're going to
Speaker 1: sign deal marketing deals. We're going to try to insist
Speaker 1: that our data, our official data, is used and that
Speaker 1: we get paid for it um and really lead the
Speaker 1: way on that right, Yes, yeah, and so they they've
Speaker 1: had a lot of success in using data as the
Speaker 1: wedge to say it's our data, it's our official data.
Speaker 1: You need to use it, and you've got to pay
Speaker 1: us for it. So I love in this line that
Speaker 1: in the story you talk about handicapping and how it
Speaker 1: has often been a shady business. Still feels like a
Speaker 1: shady business. There is a lot and and the Internet,
Speaker 1: as with everything else, has sort of multiplied it and
Speaker 1: morphed it in weird ways. So there are a lot
Speaker 1: of scam artists using Twitter and and that to basically say, I,
Speaker 1: you know, I'm infallible. Uh, my picks are always right.
Speaker 1: They're usually somehow shading the truth, if not outright lying
Speaker 1: about that and then trying to get you to pay
Speaker 1: a little money over Venmo, you know, for picks. And
Speaker 1: that's Ira boot way. He covers so much in the
Speaker 1: world of sports, and we talked to him earlier about
Speaker 1: Joe Side. That was a fascinating look at a really
Speaker 1: important figure. Well, one of the big elements in sports
Speaker 1: right now is sports betting. It was a huge topic
Speaker 1: when we were in Miami ahead of the Super Bowl. So, Carol,
Speaker 1: I want to play part of my conversation that I
Speaker 1: had with Chris Paul. I should know this was recorded
Speaker 1: here at Bloomberg headquarters a few weeks ago before the
Speaker 1: tragic passing of Kobe Bryant. And yet when I hear
Speaker 1: this interview, it's a reminder of the strong influence Kobe
Speaker 1: had on how modern players this generation, players like Chris Paul,
Speaker 1: really approached the game and their businesses. Here's your conversation.
Speaker 1: So Chris, let's start just talking business. How do you
Speaker 1: define your business world? How do you sort of put
Speaker 1: it all in perspective? And Um, first and foremost, I'm
Speaker 1: very blessed and fortunate to have an amazing team around me. Uh,
Speaker 1: it's never just me. I have an amazing team, Uh,
Speaker 1: starting with my older brother who's been with me since
Speaker 1: day want obviously since he's an older brother. But um,
Speaker 1: through NBA experiences, through business through learning, have tried to
Speaker 1: learn as much as possible. Obviously being involved with the
Speaker 1: Union has taught me a lot too, so just trying
Speaker 1: to be a sponge. And so when you think about
Speaker 1: kind of identifying opportunities, is there an overarching theme that
Speaker 1: you're going for, Because I would imagine people come to
Speaker 1: you with ideas all the time, come to you with opportunities.
Speaker 1: What's the screen? You know? It's funny when I was
Speaker 1: younger and I first came into the league, used to
Speaker 1: hear about endorsements, Oh this, players endorsing this, and endorsing that.
Speaker 1: As I got older, I started to realize that the
Speaker 1: vetting process for any business deal or anything, it has
Speaker 1: to be true to who I am and true to
Speaker 1: what I believe in. And so, um, there's been partnerships.
Speaker 1: There's no such thing really now as endorsement deals are
Speaker 1: as partnerships and things that um, I really believe in
Speaker 1: and products that I use or that you know, I
Speaker 1: really want to see come into fruition. And how often
Speaker 1: do you say now a lot? Yes, yes, you know
Speaker 1: it's it's one of those things where um, I am
Speaker 1: a people person. I love to, you know, engage and talk,
Speaker 1: but you have to learn to say no, or at
Speaker 1: least have somebody on your team and that can say no.
Speaker 1: So it feels like you are building a platform as
Speaker 1: it right. You know, I look across your media activities,
Speaker 1: your partnerships, your investments. How do you sort of break
Speaker 1: that up in terms of figuring out you know, you
Speaker 1: want to focus more media, you want to focus more
Speaker 1: on more traditional partnerships a state farmer, Nike or or
Speaker 1: or what have you. How do you sort of bucket it?
Speaker 1: You know, it's funny you ask that, because it's almost
Speaker 1: like being an athlete when you talk about playing basketball.
Speaker 1: I don't just say that I just shoot. I don't
Speaker 1: just dribble. I don't just uh, you know, block or dunk.
Speaker 1: I don't really do that much anymore. But but I
Speaker 1: try to stay as well around it as possible and
Speaker 1: try to dip in different avenues, you know, whether it
Speaker 1: be entertainment, whether it be focusing on nutrition, which is
Speaker 1: a big part of my life. And you know, this
Speaker 1: is my fifteenth year in the NBA, so I focus
Speaker 1: on on a few different things. And so how much
Speaker 1: do you think about dare I say, a post NBA
Speaker 1: career and and how much of what you're doing in
Speaker 1: business is about setting you up not just financially but
Speaker 1: but almost mentally for what that career looks like after
Speaker 1: the league. Yeah, there never be anything I believe that
Speaker 1: drives me the way basketball is. You know, you never
Speaker 1: say like I'm ready for it to be over. I
Speaker 1: don't think any athlete ever says that. But I'm always
Speaker 1: just trying to learn and be a sponge and a
Speaker 1: lot of it is that is, uh, you know, sitting
Speaker 1: here even having the conversations with you, learning and talking.
Speaker 1: And I have a few mentors out there that I'm
Speaker 1: constantly on the phone with just trying to understand the world.
Speaker 1: You know, a lot of people want to know what
Speaker 1: is it like when you hit a game winning shot?
Speaker 1: You know me, I'm like, what was it like when
Speaker 1: you close that deal? How did you have these hard conversations?
Speaker 1: And I think those experiences help you for the business world.
Speaker 1: I want to talk about a few specific deals and
Speaker 1: partnerships that you have. One of which we've spent a
Speaker 1: lot of time over the last year talking about, is
Speaker 1: Beyond Me. You were early to that, Uh, you were
Speaker 1: plant based as of last year. I believe clearly this
Speaker 1: is something you believe in. But tell me about it
Speaker 1: from a business perspective. Yeah, so Ethan from Beyond Me
Speaker 1: who was amazing, and I had an opportunity to get
Speaker 1: involved in it, and I actually got a chance to
Speaker 1: executive produce a documentary called Game Change Right. And so
Speaker 1: as an athlete, you're always trying to figure out different
Speaker 1: ways to to get an edge to whether that's training,
Speaker 1: whether that's working out, and once I've seen game changers,
Speaker 1: and um, you know, I saw what the other athletes
Speaker 1: were saying. I was like, hold on, I gotta try this. Yeah,
Speaker 1: I gotta try this. And obviously beyond meat has has
Speaker 1: been amazing. Like you said, you had the beyond meat
Speaker 1: sausages I did I could get last night, you know.
Speaker 1: And for me, um, it's just it's been life changing
Speaker 1: for me in the way that my body feels and
Speaker 1: the way that you know, I can bounce back back
Speaker 1: to backs, and it's you know, you know a lot
Speaker 1: of times you hear people talk about diet, diet has
Speaker 1: to be a lifestyle change, and for me, for me,
Speaker 1: I would say it's helped. So from a business perspective,
Speaker 1: you've also as a player, seen a lot of different cities,
Speaker 1: a lot of different business cultures in a way, and
Speaker 1: you know, I think about l A obviously, I think
Speaker 1: about Houston, I think about Oklahoma City. Now at this point,
Speaker 1: what have you learned from sort of those different markets
Speaker 1: from a business perspective. That's a great that's a great question.
Speaker 1: And I've had a number of teams that I played for. Obviously,
Speaker 1: when I was with the Clippers, Steve Balmber, you know,
Speaker 1: took over as owner of the team, so I got
Speaker 1: a chance to see how he dealt with different things.
Speaker 1: Being in Oklahoma City has been amazing. Also. One of
Speaker 1: the first things that we did that you don't see
Speaker 1: a lot of times around the league is the day
Speaker 1: a few days before training camp, we had a huge cookout,
Speaker 1: a huge cookout where everybody in the organization brought their families,
Speaker 1: you know, and in the league where a lot of
Speaker 1: times it's just ball ball ball, it was nice to
Speaker 1: you know, see, uh, the guys who handle our tickets
Speaker 1: with their kids and with their family, and like I said,
Speaker 1: it's just learning, learning, because uh, in any business, I
Speaker 1: think most people want to try to create that family
Speaker 1: and that culture. And I think that was really nice
Speaker 1: in Oklahoma City. And so what is it like playing
Speaker 1: in sort of a smaller market in a lot of ways?
Speaker 1: I mean much has been written and talked about with
Speaker 1: Oklahoma City from a basketball perspective, specifically hitting way above
Speaker 1: its weight. I mean, this is not a new phenomenon,
Speaker 1: but I do wonder what that experience is like for
Speaker 1: you It's been great. And probably I'm a little biased
Speaker 1: because I actually started my career in Oklahoma after her
Speaker 1: can train them, right. You know, I spent two years
Speaker 1: there in that fan base. Nothing like it, nothing like
Speaker 1: it the way they support you a night in the
Speaker 1: night out. Um. You know, they may call it a
Speaker 1: small market, but the fans, they have big hearts and
Speaker 1: they're behind you night in and night out, and so um,
Speaker 1: it's nice. I've been able to experience both, and you know,
Speaker 1: I love both of them. Well. It's also interesting, I think,
Speaker 1: even from a player perspective, to think about sort of
Speaker 1: the legacy of players that you're obviously now I'm part
Speaker 1: of that have gone through that franchise, that have raised
Speaker 1: it to a national prominence that that maybe you don't
Speaker 1: see even another sports And I tell you to be
Speaker 1: part of that. Oklahoma city history and culture is special
Speaker 1: and like I said, uh myself, with David West and
Speaker 1: the number of guys we got a chance to start
Speaker 1: out there when they were basically auditioning for a team.
Speaker 1: And then you know, Katie Russ, Nick Collins and James
Speaker 1: all those guys come through and that city show what
Speaker 1: it was capable of, and you know, a team will
Speaker 1: be there probably forever. Yeah. So you mentioned your role
Speaker 1: in the union, and I want to talk to you
Speaker 1: about that because obviously a very important position. Uh, not
Speaker 1: one without controversy, not one without some conflicted and conversation.
Speaker 1: What's the biggest thing you've learned from from holding that role.
Speaker 1: You've been in that job for a while now, Yeah, right,
Speaker 1: that sounds about right. I'm like, uh, may feel longer,
Speaker 1: but I've learned so much, so much. UM. I've always
Speaker 1: said this, I went to college for two years. No
Speaker 1: business class could teach me the on job training that
Speaker 1: I've learned as president of the union. Um. From the
Speaker 1: other players on the executive committee. You know, you just
Speaker 1: learn how to talk and communicate with people. Michelle Robberts,
Speaker 1: our executive director, She's taught me so much, other people
Speaker 1: that work within the union, the conversations I've had an
Speaker 1: opportunity to have with Adam Silver, you know, just constantly
Speaker 1: learning and really understanding the business of the game. Because
Speaker 1: as a kid, when you're in the backyard, you just like,
Speaker 1: you know, I'm m J I want to play in
Speaker 1: the n b A. You never think about the business
Speaker 1: of it. And so to learn that has has truly been. Um,
Speaker 1: just it's so valuable, right you mentioned Michelle Roberts. I
Speaker 1: know that some succession planning is going on there. Where
Speaker 1: are you at that point? But what do we see next? Um,
Speaker 1: first and foremost is not just Michelle, you know, it's myself,
Speaker 1: you know, I Dragon Dollar. We have board members and
Speaker 1: stuff that have been in this position for for a while.
Speaker 1: And that's why I say the importance of mentors and
Speaker 1: businesses and uh, one of my you know, huge mentors
Speaker 1: and and Eiger is that's one of the first things
Speaker 1: he said. Yeah, yeah, for those of us who don't
Speaker 1: call one of one of one of the first things
Speaker 1: that he sort of you know, told me years ago
Speaker 1: is that succession planning is real if we want the
Speaker 1: union to be a real business. You know, most big
Speaker 1: businesses have succession plan and so that's all it is, right,
Speaker 1: So what what's the most important element of succession planning
Speaker 1: for that particular part of the organization. Just making sure
Speaker 1: that whoever the next person in the line is no
Speaker 1: about the conversations that are being had now. And so
Speaker 1: that's what I'm doing also with other guys that's on
Speaker 1: the board and trying to find out who may be
Speaker 1: interested in being the president after me, right, you know,
Speaker 1: and just making sure that you know, if there's conversations
Speaker 1: being had now, they're involved on them. That way, if
Speaker 1: they do take over, it's not just brand new And
Speaker 1: that's NBA star Chris Paul, you know, beyond meat state farm,
Speaker 1: so many things that he is constantly thinking about, taking
Speaker 1: care of his family and sort of being there for them,
Speaker 1: all the things that happen in the modern life of
Speaker 1: an NBA player. Well, I think, and it's interesting you're
Speaker 1: seeing athletes that's no longer just here's my name, put
Speaker 1: it on merchandise or what have you. They're very, very involved.
Speaker 1: I feel like in the investments that there and even
Speaker 1: the terms that he uses. He doesn't do sponsorships, he
Speaker 1: does partnerships, and it's a much more holistic approach to
Speaker 1: be sure. Well, that wraps up the weekend edition of
Speaker 1: Bloomberg Business Week from Bloomberg Radio. Thank you so much
Speaker 1: for joining us. I'm Jason Kelly and I'm Carol Masser.
Speaker 1: Be sure to tune into Bloomberg Business Week Radio Live
Speaker 1: Monday through Friday starting at two pm Wall Street Time.
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Speaker 1: same time. This is Bloomberg