Speaker 1: Bloomberg Audio Studios, Podcasts, radio news.
Speaker 2: Well, Elon Musk is now the richest person on the planet.
Speaker 3: More than half the satellites in space are owned and
Speaker 3: controlled by one man.
Speaker 4: Well, he's a legitimate super genius. I mean legitimate.
Speaker 3: He says he's always voted for Democrats, but this year
Speaker 3: it will be different.
Speaker 1: He'll vote Republican.
Speaker 5: There is a reason the US government is so reliant
Speaker 5: on him.
Speaker 6: Elon Musk is a scam artist and he's done nothing.
Speaker 3: Anything he does, he's fascinating the people. Welcome to Elaning
Speaker 3: Bloomberg Weekly podcast about Elon Musk. It's Tuesday, April thirtieth.
Speaker 3: I'm your host, David Papadopolis. This week we're talking about
Speaker 3: China and X. Elon took his jet to Beijing Sunday,
Speaker 3: where he cut a deal that will allow Tesla to
Speaker 3: sell what it calls full self driving technology. So far
Speaker 3: the market approves. Tesla stock soared the most in three
Speaker 3: years on Monday, extending a rebound that began after last
Speaker 3: week's earnings call. Then we're going to go down memory
Speaker 3: lane as we celebrate the two year anniversary of the
Speaker 3: Twitter board accepting Musk's offer to buy the company. Oh,
Speaker 3: Elon's tried a lot of things these past two years,
Speaker 3: and let's just say not all of them have quite
Speaker 3: worked out dating service anyone. But before all that, a
Speaker 3: quick programming note. We're hitting the road again. We'll be
Speaker 3: in San Francisco next week to record a live episode
Speaker 3: at the Bloomberg Tech Summit. Come join us. We're going
Speaker 3: to start off with Tesla and for this, as always,
Speaker 3: we have Dana Hull, Bloomberg's Elon Reporter extraordinaire Ala Dana. Hey, Hey,
Speaker 3: And we have Max Chepkin, Bloomberg BusinessWeek's senior writer editor
Speaker 3: and ava fanatic of the New York Metropolitans. Hey, David, Hello, Max, Okay, Dana.
Speaker 3: So we wake up Sunday to find Elon is in Beijing.
Speaker 3: I'm not sure we knew that was going to happen.
Speaker 3: He shows up out of the blue there to do
Speaker 3: what exactly and does he achieve what he's trying to do?
Speaker 1: Well? I mean, if you follow his jet, which obviously
Speaker 1: those of us who follow Elon, no, I mean you
Speaker 1: knew that he was heading to China, but it wasn't
Speaker 1: an announced visit, if that's what you mean. But I
Speaker 1: think what's interesting is, you know, to back up for
Speaker 1: a minute, Elon was supposed to go to India. He
Speaker 1: cancels the trip to India, says he's got pressing matters
Speaker 1: at Tesla. He has an earnings call where he basically
Speaker 1: says the future of the company is all about autonomy.
Speaker 1: And then he pops up in Beijing, which is not
Speaker 1: where Tesla has its factory, but he meets with like
Speaker 1: the number two guy in China, and then basically they're
Speaker 1: trying to get permission to unroll what they call FSD
Speaker 1: in China, which is a huge undertaking because the mapping
Speaker 1: in China is very different than the road system in
Speaker 1: the United States that it's like a whole different regulatory regime.
Speaker 1: It's an enormous country. But this is like a big
Speaker 1: deal for Elon, and I think it just kind of
Speaker 1: shows that, like, you know, love him or hate him,
Speaker 1: whatever you think about the guy, he is just like
Speaker 1: operating on a level that is very different from the
Speaker 1: way most other CEOs operate. And you know, so he's
Speaker 1: in China and the stock goes up to its highest,
Speaker 1: you know, has its highest gain in over three years.
Speaker 1: The market is betting on this whole idea that the
Speaker 1: future of the company is not really about selling cars,
Speaker 1: it's about selling software.
Speaker 3: You know, Max, It's funny. For the longest time I've
Speaker 3: been telling myself that, boy, we really need to talk
Speaker 3: about China on this podcast. We have failed to Max
Speaker 3: until now. China is pretty darn important for Tesla, is
Speaker 3: it not.
Speaker 2: Yeah, So, Tesla is a factory in China. As Dana hinted,
Speaker 2: China is also the biggest market for electric vehicle. It's
Speaker 2: widely thought of as sort of the market with the
Speaker 2: most potential for electric vehicle sales. And you know that's
Speaker 2: because it's a huge country, of course, big economy, but
Speaker 2: also because the government, the Chinese government has invested and
Speaker 2: promoted this industry in a huge way, and it actually
Speaker 2: has made Elon Musk kind of a centerpiece of that.
Speaker 2: The thing is, what's happened in the past couple of
Speaker 2: years is we've seen this new wave of Chinese car companies.
Speaker 2: We've talked on this podcast before about byd Jaomi, you know,
Speaker 2: better known as smartphone maker, is making cars. Lots of
Speaker 2: Chinese companies are having lots of success making cars, which
Speaker 2: was kind of the plan all along. I mean The
Speaker 2: reason that China gave Elon Musk a bunch of sort
Speaker 2: of favorable policies and so on was because they wanted this.
Speaker 2: They wanted him to kind of be at the center
Speaker 2: of their EV industry, and that's kind of what happened.
Speaker 2: And and Elon Musk is kind of still enjoying the
Speaker 2: fruits of that relationship, right.
Speaker 3: So they did court him back in the day to
Speaker 3: help jump start their EV industry they needed in Then
Speaker 3: I get the sense that China doesn't quite need him
Speaker 3: as much now. He kind of needs China more than
Speaker 3: China needs him.
Speaker 4: No, China doesn't need him.
Speaker 2: We were talking about India a couple of weeks ago,
Speaker 2: and I mentioned that, you know, it's a little risky
Speaker 2: to go to India and potentially announce a big investment
Speaker 2: because China is not going to like that. And I
Speaker 2: don't think it's a coincidence that we had this cancelation
Speaker 2: of the India trip and this trip to China. And
Speaker 2: when you look at the way that the Chinese media
Speaker 2: is playing it, you know they're mentioning, prominently mentioning the
Speaker 2: cancelation of the India trip.
Speaker 3: Now, Dana, this deal that he has apparently inked for
Speaker 3: full self driving, which we have described at length in
Speaker 3: previous episodes. You can you can just find those discussions
Speaker 3: there in the archive. But is this deal, Dana Hall,
Speaker 3: is it final or is it they still need to
Speaker 3: work out some other particular No, I don't.
Speaker 1: Think it's final. I think it's like directionally positive that
Speaker 1: they got you know, he you know, so he was
Speaker 1: in Beijing meeting with the Number two talking about FSD.
Speaker 1: He's got a relationship with Beadu to sort of underwrite
Speaker 1: or underpin a lot of the mapping that's needed. He
Speaker 1: got some permission from not the military directly, but like
Speaker 1: some kind of military apparatus that will allow Tesla to
Speaker 1: operate more easily in China. I mean a lot of
Speaker 1: things still have to happen, but it's all directionally very positive.
Speaker 1: And Tesla hasn't announced anything. I mean, there's been no
Speaker 1: announcement or filing from Tesla whatsoever saying that they're now
Speaker 1: rolling out FSD in China. But that's certainly what the
Speaker 1: market is excited about.
Speaker 4: I mean, there's no deal.
Speaker 2: They're on a list of like qualified car companies to
Speaker 2: conceivably along with like dozens of others. I think I
Speaker 2: think some seventy or eighty other car models are on
Speaker 2: this list that give them the right to conceivably launch this,
Speaker 2: and they're all of these issues. So China, of course
Speaker 2: is very concerned learned about AI. You know this, this
Speaker 2: is not a liberal democracy as a country that regulates
Speaker 2: its technology very closely that you know, wants certain access
Speaker 2: to data and that's very important with you know, any
Speaker 2: kind of software and especially with a data collection scheme
Speaker 2: like a quote unquote Robotaxi. And the other thing is
Speaker 2: China has been very adamant about ensuring that local partners
Speaker 2: are playing a role, so that's why they had this this.
Speaker 2: The other part of this is this announcement of a
Speaker 2: deal with Baidu, which Tesla already had you know, a
Speaker 2: relationship with before. But it's it's essentially like little breadcrumbs
Speaker 2: that point in a somewhat promising direction. And that coupled
Speaker 2: with Elon Musk saying last week that he thought, you know,
Speaker 2: full self driving quote unquote could happen in China, that
Speaker 2: the people are taking that as a positive sign.
Speaker 3: Yeah, and we're going to go back to that earnings call.
Speaker 3: Actually now, you know, Dana whether the market reaction this
Speaker 3: week when the stock short fifteen percent on Monday, is
Speaker 3: an overreaction or not. It comes on the heels of
Speaker 3: a big rebound in the stock last week as well.
Speaker 3: The stock, of course, had been tanking all year, and
Speaker 3: now it's it's bounced back over thirty percent, even though
Speaker 3: I think it's it opened up down a bit today.
Speaker 3: I suppose to a certain degree, you kind of got
Speaker 3: to give it to Musk. He sort of pulled a
Speaker 3: rabbit out of his hat here, turning around a stock
Speaker 3: that had been essentially in free fall.
Speaker 7: Yeah.
Speaker 1: I mean he changed the narrative, and he's very good
Speaker 1: at that. I mean, this is a guy who's been
Speaker 1: the CEO since two thousand and eight. He has been
Speaker 1: through cycles before and and he kind of he understands
Speaker 1: Wall Street psychology, which is like what is the long
Speaker 1: term future of the company. And you know, so the
Speaker 1: whole year has been crappy, the stock has been down.
Speaker 1: He seemed distracted. He seemed to be focusing on all
Speaker 1: of his other companies and not on Tesla, which is
Speaker 1: the key to his wealth. You had the layoffs, you
Speaker 1: had sagging sales, like all this like negative negative, negative, negative,
Speaker 1: so he comes into the earnings call and like he
Speaker 1: knows that he's got to turn it around, so he
Speaker 1: like plants a flag.
Speaker 3: Yeah, what exactly did he say on that call? Because
Speaker 3: just shortly before he gets on that call, the earnings
Speaker 3: came out, the first quarter earnings, and they were about
Speaker 3: a disappointing or maybe even more disappointing than everybody had
Speaker 3: thought they'd be. He opens his mouth though on the call,
Speaker 3: and then the stock just starts going up and up
Speaker 3: and up. What was it in particular that that investors
Speaker 3: latched onto.
Speaker 1: Well, he basically planted a very strong flag and talked
Speaker 1: about autonomy. And I think we have tape on that.
Speaker 3: Yes we do. You're right, let's listen to it.
Speaker 5: Really, we should be thought of as an AI robotics company.
Speaker 5: If you value tells it as just like an order company,
Speaker 5: you would just have to fundamentally just the wrong framework
Speaker 5: then will come to be. If you ask the wrong question,
Speaker 5: then the right answer is impossible. I mean, if somebody
Speaker 5: doesn't believe tell is going to solve autonomy, I think
Speaker 5: they should not be an investor in the company.
Speaker 3: If you just value Tessel's an auto company. Max Chafkin
Speaker 3: you're a loser. But listen, Dana. But here's the thing.
Speaker 3: Is it actually the autonomous part that drove the stock
Speaker 3: up so much or was it more about him talking about, Hey, no,
Speaker 3: we have actually haven't given up on this affordable tessel
Speaker 3: model idea.
Speaker 1: I mean, I think it was both. They basically said
Speaker 1: it was sort of like they split the you know,
Speaker 1: split the baby in half, or however you want to
Speaker 1: call it. It was like, Oh, don't worry, we still
Speaker 1: are going to make affordable cars. Ish, they're gonna be
Speaker 1: this kind of like Frankenstein hybrid model where we're going
Speaker 1: to take some of the new car and marry it
Speaker 1: with some of the next generation unboxed assembly process, and
Speaker 1: we're going to have a cheaper model maybe by the
Speaker 1: end of this year.
Speaker 3: Then actually, let's let's let's listen to the tape on
Speaker 3: that as well. Hold on.
Speaker 5: We've updated our future vehicle lineup to accelerate the launch
Speaker 5: of new models. Head previously mentioned start production in the
Speaker 5: second half of twenty twenty five, so we expect it
Speaker 5: to be more like the early twenty twenty five, if.
Speaker 3: Not late this year.
Speaker 5: These new vehicles, including more affordable models, will use aspects
Speaker 5: of the next generation platform as well as aspects of
Speaker 5: our current platforms, and we'll be able to produce on
Speaker 5: the same manufacturing lenes as like currentfig.
Speaker 3: Lineup, all of which means what mister chaff.
Speaker 4: It means nothing.
Speaker 2: I mean, it's kind of amazing that we went into
Speaker 2: this saying is he going to what is he going
Speaker 2: to say about the model to this cheaper car? And
Speaker 2: that clip that you played that was it, I mean
Speaker 2: during that because it raises all these questions, like so
Speaker 2: he said that the car would be made on the
Speaker 2: more affordable car will be made on the same production lines.
Speaker 2: Kind of raises a question, so are we talking about
Speaker 2: a new model or we talking about a cheaper version
Speaker 2: of a current model, which an analyst asked and Elon
Speaker 2: Musk said, ooh, no comment. We've said all we will
Speaker 2: on this back to the Robotaxi, and this happened several
Speaker 2: times during the call. An analyst would ask kind of
Speaker 2: like a reasonable question about these new models and or
Speaker 2: supposed new models, and Elon Musk would say, never mind, robotaxi.
Speaker 2: And so it's pretty clear to me anyway that there
Speaker 2: are two things going on. One is they're going to
Speaker 2: launch this Robotaxi, and by launch I mean have a
Speaker 2: car that looks Robotaxi ish and lift a sheet off
Speaker 2: of it in August. And they are trying very aggressively
Speaker 2: to lower the prices of the Model three and the
Speaker 2: Model Why Elon Musk hasn't specifically said that there isn't
Speaker 2: going to be a Model too, but it really when
Speaker 2: you look at what he's saying, how he's saying it,
Speaker 2: it seems pretty clear. You have two things. You have
Speaker 2: the Robotaxi, and you have an effort to keep get
Speaker 2: the prices on the current lineup as low as possible
Speaker 2: and maybe do whatever you can to refresh that lineup.
Speaker 2: And that is that is a huge departure from everything,
Speaker 2: not everything, but for many of the things that Elon
Speaker 2: Musk has been signaling and saying and so on over
Speaker 2: the last year or so.
Speaker 3: Okay, so Dan Max is from what I glean here
Speaker 3: feels like the market perhaps is irrationally exuberant about mister
Speaker 3: Musk's comments. Nonetheless, the stock is way back up for
Speaker 3: the moment and things are at least looking slightly less
Speaker 3: hour there. But the layoffs continue, do they not?
Speaker 2: Just to be super clear, the news from this morning
Speaker 2: is that two more key executives are gone fired or
Speaker 2: dismissed or however it actually went down, and their entire
Speaker 2: divisions are also closing. So and that's the new Car
Speaker 2: division and as Dana is saying, that the Supercharger division.
Speaker 2: So it's not like you have to like be a
Speaker 2: close reader of the things that Elon Musk says during
Speaker 2: his earnings call to figure out what's going on with
Speaker 2: the new models.
Speaker 4: He just dismissed the entire new model team.
Speaker 1: Yeah, I mean, so's Ed Ludlow and I reported Musk
Speaker 1: wanted to cut twenty percent, and then when they announced
Speaker 1: the layoffs, the email from him said more than ten percent.
Speaker 1: So like, what is that? Is that nineteen percent? Is
Speaker 1: that eighteen percent? Like we've never gotten like a very
Speaker 1: clear number. But the layoffs have been happening in waves,
Speaker 1: and just overnight a lot of people on the Supercharging
Speaker 1: team were impacted, and you're starting to see people post
Speaker 1: on LinkedIn and Twitter and elsewhere about how, yeah, my
Speaker 1: team and I were wiped out. And this comes at
Speaker 1: like a really pivotal time for the company because you know,
Speaker 1: the big news of twenty twenty three was that Tesla
Speaker 1: was finally opening at supercharger network to other automakers, So
Speaker 1: if you own like a Ford or a GM electric vehicle,
Speaker 1: you can now go to superchargers. And the whole integration
Speaker 1: of supercharging with other automakers is a big theme of
Speaker 1: like the summer of twenty twenty four. Now all of
Speaker 1: the people that were in charge of kind of you know,
Speaker 1: inking those deals and leading those partnerships are gone and
Speaker 1: all of this is happening in the broader context of
Speaker 1: Elon wants his pay package, so he's very much leaning
Speaker 1: into this like I'm back in the saddle, I'm in charge,
Speaker 1: I'm making tough decisions, I'm laying people off, I'm going
Speaker 1: to China. Like he's doing all this stuff to kind
Speaker 1: of prove to his shareholders that he is still very
Speaker 1: much the CEO and he deserves that big pay.
Speaker 5: You know.
Speaker 2: The other thing is it seems that he has closed
Speaker 2: the policy division, which again is kind of a curious
Speaker 2: choice when you're trying to laun a heavily regulated likely
Speaker 2: to be controversial, you know, I think regulators are gonna
Speaker 2: have something to say about releasing car without a steering wheel,
Speaker 2: And it seems like at least, the current policy team
Speaker 2: is going to be replaced with some new arrangement that
Speaker 2: hopefully won't just be like an emoji like the NITSA
Speaker 2: regulator send an email to to Elon Musk and they
Speaker 2: get a poop back or something.
Speaker 3: Yeah, no, that well, it's distinctly possible. We've we've had
Speaker 3: a lot of poop emojis sent our way over these
Speaker 3: last couple of years. But Dan, so, just to finish
Speaker 3: up for a second on the earnings call, because of
Speaker 3: course before the earnings call, we put out in front
Speaker 3: of the world again our Tesla Bingo card, our earnings
Speaker 3: Bingo card, and did we get bingo or not?
Speaker 1: Once again? You know, Max and I worked really hard
Speaker 1: to kind of try to create a create a Bingo
Speaker 1: Bingo card. That's that was going to do it for us.
Speaker 1: We were one short because even though he said a
Speaker 1: lot of things that were on our card, he never
Speaker 1: said the word interest rates, and then we would have
Speaker 1: gotten it. We would have gotten it if he'd said
Speaker 1: interest rates.
Speaker 2: Yeah, Row one going across Robotax, Saxey regulatory approval, next
Speaker 2: gen and Horse.
Speaker 4: Actually he said horse twice.
Speaker 3: Okay, very good. Well, we'll be back with another new
Speaker 3: and improved Bingos Bingo card. Come come second quarter earnings. Okay,
Speaker 3: So now we're gonna talk about the two year anniversary
Speaker 3: of Elon Musk's purchase of Twitter now X and to
Speaker 3: do that we have joining us Kurt Wagner, Bloomberg technology
Speaker 3: reporter and author of the book Battle for the Bird.
Speaker 6: Welcome, Kurt, hey, Thank you for having me appreciate it.
Speaker 3: It's been a while since we've talked about how things
Speaker 3: are going at X and the current state of finances there.
Speaker 3: How is it going well.
Speaker 6: We don't have many updates from the last time we
Speaker 6: all chatted. We know that things were not going well
Speaker 6: at the end of the lastlast year, not only because
Speaker 6: there was the lingering effects of the advertising you know,
Speaker 6: issues that the company had had, but as you all
Speaker 6: remember very well, Elon then went on stage at the
Speaker 6: deal Book conference and I believe it was early December
Speaker 6: and told advertisers to go f themselves, right. So he
Speaker 6: sort of ended twenty twenty three, came into twenty twenty
Speaker 6: four on a very sour note, and as we've talked
Speaker 6: about historically, like his behavior on X. In my opinion
Speaker 6: and from the conversations i've had with a lot of
Speaker 6: marketers is the biggest turnoff and the biggest hurdle to
Speaker 6: their entire business, and we've seen that that's continued to
Speaker 6: this day. You know, he tweets things that are incredibly
Speaker 6: inappropriate regardless of who you are, but especially as the
Speaker 6: CEO and face of this company. And so we don't
Speaker 6: have numbers because they're not publicly traded, they don't have
Speaker 6: to report earnings, but we just I don't think anything
Speaker 6: has really improved since we talked about this a couple
Speaker 6: of months ago, when things were really in a downward spiral.
Speaker 3: Yeah, Now, Kurt on his behavior on X, he's actually
Speaker 3: been trying to remove what is essentially something of a
Speaker 3: gag order on him on X, not as it's related
Speaker 3: to the company X, but as related to Tesla. This
Speaker 3: is the fame Twitter sitter. Explain what's transpired.
Speaker 6: Yeah, so quick backstory, But basically, after he promised to
Speaker 6: or pledge to take Tesla private at four hundred and
Speaker 6: twenty dollars per share, which he ultimately did not you know,
Speaker 6: have the money to do, the sec came to a
Speaker 6: settlement agreement with Elon where his posts on Twitter or
Speaker 6: now X that are related to Tesla need to be
Speaker 6: approved or at least vetted by a company lawyer, and
Speaker 6: so he has been trying to get rid of this
Speaker 6: Twitter sitter as it's called, and you know, saying that
Speaker 6: this is an infringement on his free speech. He was
Speaker 6: hoping that the Supreme Court would actually take up this
Speaker 6: case and determine whether this was violation of his free speech.
Speaker 6: But the Supreme Court said, no, we're not. You know,
Speaker 6: we have other things going on that we should probably
Speaker 6: be putting more attention to, so they sort of chose
Speaker 6: not to take that case. But I mean, honestly, honestly,
Speaker 6: I cannot believe that there is a lawyer who already
Speaker 6: reviews his Tesla tweets and approves of them, because it
Speaker 6: seems crazy that any of this stuff is vetted. Certainly,
Speaker 6: everything that's unrelated to Tesla is clearly not vetted. And
Speaker 6: even the Tesla stuff, as you guys can probably attest to,
Speaker 6: sometimes seems quite borderline to me. So I'm not sure
Speaker 6: how much this really matters.
Speaker 1: So to back up for a minute, I mean, there
Speaker 1: really was a Twitter sitter. We knew their name at
Speaker 1: one point. It was in like a filing in between
Speaker 1: like the sec and MUSC and his lawyers. But then
Speaker 1: there's been so much turnover in Tesla's legal department that
Speaker 1: I actually don't know who has the job right now.
Speaker 1: But it's like the Designated Securities Council, like it has
Speaker 1: like a name, And a lot of people were like,
Speaker 1: you're just making this up. There is no Twitter sitter,
Speaker 1: and I was like, no, no, there really is.
Speaker 6: I guess I'm curious, Dana. You followed Elon as close
Speaker 6: as anybody. Do you really think he's composing a tweet,
Speaker 6: taking the time to email it over to some lawyer,
Speaker 6: waiting for approval before posting it. I just have no
Speaker 6: impossible time imagining.
Speaker 2: How dare you suggest that when Elon Musk tweets a
Speaker 2: picture of one dog placing its testicles on another dog,
Speaker 2: that he is not vetting that with Tesla's compliance department.
Speaker 3: Well, you don't know what was what was you know
Speaker 3: what the original Yeah, that's true.
Speaker 4: You're right. The compliance department might have been like, we
Speaker 4: got to dial this one back.
Speaker 3: I put a little disclaimer at the bottom and back
Speaker 3: on the right side of the line. Absolutely, you know,
Speaker 3: bringing the conversation back to the actual company X for
Speaker 3: a second. You know, Kurt, when he purchased the company,
Speaker 3: he at the time was sort of fairly obsessed with
Speaker 3: we Chat and the idea of an everything app. This
Speaker 3: is actually what he said back then in an interview.
Speaker 8: I mean, we don't even have a that that's as
Speaker 8: good as we Chat in China, and like, in China,
Speaker 8: you like live on we Chat. Basically everyone's like, like,
Speaker 8: you live on we Chat, you do payments, you do everything.
Speaker 5: It's like yep, it's great chats, kick ass. And we
Speaker 5: don't have anything like we Chat outside of China. So
Speaker 5: I was like, my idea would be, like, how about
Speaker 5: if we just copy we Chat?
Speaker 3: Hey, So Kurt his efforts to quote unquote copy weed Chat,
Speaker 3: how's that going?
Speaker 6: Well, this is the idea of the everything app that
Speaker 6: Elon talks about a lot, and we haven't really seen
Speaker 6: a lot of those ideas materialize. We've heard him talk
Speaker 6: about the idea of banking, certainly, video and entertainment, this
Speaker 6: idea of you know, using X to do shopping perhaps
Speaker 6: or basically to run your life. They were teasing this
Speaker 6: idea of video conferencing within X as well the other day,
Speaker 6: so you know, maybe replaced zoom I think the biggest
Speaker 6: issue is number one. As I mentioned, a lot of
Speaker 6: these products are just sort of talked about, right, They're
Speaker 6: just they're out in the ether, but they don't actually
Speaker 6: exist at the moment. But I think the bigger issue is, uh,
Speaker 6: you know, when you are focused on everything, as Elon
Speaker 6: says he wants to do, you don't really do any
Speaker 6: one thing particularly well, right, And I'm not sure that
Speaker 6: anyone is at this stage looking for a single app
Speaker 6: to do all of these things in their life. And
Speaker 6: that's part of the reason that the everything app idea
Speaker 6: has not taken off outside of China. Right, He's like, Hey,
Speaker 6: we build this and succeeds in China, why don't we
Speaker 6: just build this elsewhere. Well, they've tried to build this.
Speaker 6: Mark Zuckerberg tried to do this at Facebook for several
Speaker 6: years with Messenger and WhatsApp and found basically that in
Speaker 6: the US in particular, people are used to having different
Speaker 6: apps that specialize in different skills, and they want to
Speaker 6: go to Uber to get their Uber ride, and they
Speaker 6: want to use their banking app to get their bank.
Speaker 3: I'm going to rapid fire hit you with a bunch
Speaker 3: of the things that they've tried over these last two years,
Speaker 3: and you're gonna just you know, give us your reaction
Speaker 3: curt in terms of how they've gone. So I got
Speaker 3: Twitter Blue Premium.
Speaker 6: I think that's been a huge flop for the most part.
Speaker 6: We don't know how many subscribers they have, but estimates
Speaker 6: are I believe less than a million people are willing
Speaker 6: to pay the eight dollars per month for this service.
Speaker 6: I'd say this is where they've done the most change
Speaker 6: to Twitter, Like, if you pay the eight dollars, you'd
Speaker 6: probably get the biggest differentiated experience than you did from
Speaker 6: Twitter one point zero. But I just don't think enough
Speaker 6: people are paying for this for that to be considered
Speaker 6: a huge success right now.
Speaker 3: Not good, Not good, says Max Job search Board Kurt
Speaker 3: Wagner Job Searches.
Speaker 6: This is one thing that I think a lot of
Speaker 6: people don't even realize exists on Twitter, which is that
Speaker 6: if you are a business and you pay for like
Speaker 6: a premium business account, you can then post your jobs
Speaker 6: on there. I funny enough, even though I don't know
Speaker 6: if a lot of people not exist. The company claims
Speaker 6: this is doing incredibly well. Hundreds of thousands of job
Speaker 6: postings and it sort of makes sense, right. I think
Speaker 6: a lot of people do use Twitter in some type
Speaker 6: of professional capacity, So maybe you would you come across
Speaker 6: a job posting on Twitter versus say, you know, Instagram
Speaker 6: or TikTok or something like that. But I don't think
Speaker 6: it's necessarily something that like the average consumer of Twitter
Speaker 6: or X. Now, excuse me, is really you know, clamoring.
Speaker 3: For Kurt premium video premium video?
Speaker 6: You may recall after cees in January, I think I
Speaker 6: came on here. We talked about Don Lemon and Tulsa
Speaker 6: Gabbard and Jim Rome and WWE and how you know,
Speaker 6: X was going to be the new place to go
Speaker 6: basically watch like exclusive premium content that has not materialized yet.
Speaker 6: We obviously know what happened with Don Lemon. That deal
Speaker 6: fell apart before it ever got going. As far as
Speaker 6: I know, Tulsa Gabbard and Jim Rome have not actually
Speaker 6: posted any original videos to X. I actually reached out
Speaker 6: to them last week just to make sure, and I
Speaker 6: was told they would get back to me, and then
Speaker 6: I never heard. But I haven't seen anything on their feeds.
Speaker 6: So these deals that they've really promoted in January, I
Speaker 6: don't know if anything exists. There are certainly nothing real mainstream.
Speaker 1: To me, what I just keep noticing is that it
Speaker 1: just seems like Musk is doing anything possible to boost
Speaker 1: engagement and he's failing so spectacularly. Like yesterday, Taylor Swift
Speaker 1: tweeted something out and then like Musk responded to Taylor
Speaker 1: and then she ignored him, And it's like, oh, man, like,
Speaker 1: are you just really trying to like goose those numbers?
Speaker 1: And even some of his more like ridiculous kind of
Speaker 1: you know, juvenile memes and stuff. It's like, I don't know,
Speaker 1: I just feel I just would love to know what
Speaker 1: the true engagement of numbers are.
Speaker 2: All this is so bad, but I do feel like
Speaker 2: we need to acknowledge some good things, one of which
Speaker 2: is Kurt didn't mention Tucker Carlson.
Speaker 4: And you know, there was a point when not to.
Speaker 2: Just looking for the silver lining here, the Tucker shaped
Speaker 2: lining to this cloud. But there was a point when
Speaker 2: Elon took over Twitter and clearly started shifting to the
Speaker 2: right where it wasn't clear that there even was a
Speaker 2: market for a right wing social network.
Speaker 4: And I think you have to say he's made one.
Speaker 2: This is a more successful version of the company that
Speaker 2: Donald Trump wanted to start with Truth Social that you know,
Speaker 2: the rumble guys are trying to run. This is truly
Speaker 2: a place where you know, in fluential conservative thought leaders
Speaker 2: are hanging out.
Speaker 3: It's a market. Maybe it's a viable market. Is it
Speaker 3: a monetizable market in a meaningful way?
Speaker 6: It is monetizable, yes, Is it in a meaningful way?
Speaker 6: I'd probably say they've proven thus far that it's been
Speaker 6: really hard. I don't think that the stuff that Elon
Speaker 6: is tweeting about is necessarily the very friendly family friendly
Speaker 6: certainly not ground that a lot of marketers want to
Speaker 6: put their name attached to. And I think that's really
Speaker 6: the biggest issue all.
Speaker 3: Right now, Max, can I go back to my list
Speaker 3: here please for a second. So also I got for
Speaker 3: Kurt dating, the dating service app. What's going on?
Speaker 6: Yeah, So there's a handful of products I mentioned with
Speaker 6: this everything app idea that we've heard him kind of
Speaker 6: hint at talk about but that have not materialized. Dating
Speaker 6: falls into that category. Wouldn't it be great to find
Speaker 6: your next date on X Stay tuned, Perhaps you will someday.
Speaker 6: As of right now, that does.
Speaker 4: Not exist it's a horrifying prospect.
Speaker 3: Okay, it's worth Kurt bank service and payments. I mean,
Speaker 3: you want me to take my money out of Vanguard
Speaker 3: and move it over to X.
Speaker 6: What if I told you you could get a very
Speaker 6: high yield on those savings that X's hole and that
Speaker 6: was a pledge. Yeah, that's the pledge that Elon has
Speaker 6: made a few times. Again, similar to dating, haven't seen
Speaker 6: the product yet. This one is they have applied for
Speaker 6: payments transfer licenses. Essentially, they have to go through all
Speaker 6: fifty states to get permission to allow users to transfer
Speaker 6: money through the app. They are in the process of
Speaker 6: applying for these. I believe there's something like more than
Speaker 6: a dozen states that have already been approved, but it
Speaker 6: doesn't exist yet. His whole idea was, why don't you
Speaker 6: simply keep your money with us. We'll give you a
Speaker 6: great yield, you know, savings yield on that money, and
Speaker 6: then you can use it to not only buy things
Speaker 6: through ads you see on X, but.
Speaker 3: To pay people. So, Danahll, are you ready to move
Speaker 3: all your money onto X?
Speaker 1: Absolutely not. I mean, I'm not giving Elon Musk any
Speaker 1: access to my personal financial information, but I do want
Speaker 1: to mention that like, if you think about Elon and
Speaker 1: the early history of Elon, like this all comes back
Speaker 1: to his PayPal days, which is like the sort of
Speaker 1: Elon era that we all kind of forget about. But
Speaker 1: when people are like, who is Elon Musk? Oh, yeah,
Speaker 1: like he's the founder of Tesla, it's like, no, no,
Speaker 1: he's not the founder of Tesla. But also like he
Speaker 1: became a millionaire because of PayPal and PayPal being sold
Speaker 1: to eBay, and like he's always been interested in payments,
Speaker 1: Like that's like the original sin of like how this
Speaker 1: guy became who he is. And so I do think
Speaker 1: it is interesting that he's like kind of coming full
Speaker 1: circle in terms of his original vision for what PayPal
Speaker 1: could have been.
Speaker 3: Yeah.
Speaker 2: Yeah, but to be fair, he got fired from that
Speaker 2: job for doing this exact thing.
Speaker 4: I mean, he he was.
Speaker 3: As it was, he was pushed up. But it was
Speaker 3: a it was a power struggle, right, I mean.
Speaker 4: Yeah, yeah.
Speaker 2: He he wanted to do an everything app called X
Speaker 2: and the investors and Peter Teel, the co founder, disagreed,
Speaker 2: wanted to focus on payments, and Elon Musk lost that
Speaker 2: power struggle. Of course, here, although there are these debt
Speaker 2: holders and so on. There are external shareholders of X.
Speaker 2: You know, there's no you know, no one's challenging him
Speaker 2: on any of this stuff.
Speaker 3: So I guess, like, yeah, two years into X, it
Speaker 3: looks like we're just getting confirmation that tel was right
Speaker 3: back then.
Speaker 2: I do think if you were a you know, X
Speaker 2: dot com truther X dot com as the nineteen nineties version,
Speaker 2: it's been a tough couple of years for you. It
Speaker 2: really does look like, as you said, David, focusing on
Speaker 2: a single product is probably better than kind of scattershot
Speaker 2: launching dating sites and banks and highyield savings accounts.
Speaker 4: I mean, are we going to talk about the one
Speaker 4: thing that is going well at.
Speaker 3: X, the high yield X savings account? Okay, so you
Speaker 3: want to talk about GROC, tell us about.
Speaker 4: Gro So Rock.
Speaker 2: Last week there were news reports, including it at Bloomberg
Speaker 2: that it's raising money at evaluation of eighteen billion dollars. Again,
Speaker 2: you know, we don't know for sure, but I think
Speaker 2: there's a pretty good chance that Groc is worth more
Speaker 2: right now than X, and Grock, of course, is kind
Speaker 2: of piggybacked, I should say X AI although it's not
Speaker 2: technically part of X. It's very much piggybacking on X.
Speaker 2: X is the main distribution platform. These two entities don't
Speaker 2: really exist without the other. And when Kurt's excellent book
Speaker 2: came out, you know, he was on this podcast and
Speaker 2: we talked about you know what, you know, where the
Speaker 2: value was, and Kurt suggested that maybe this is just
Speaker 2: an AI play, And I think that looks pretty good
Speaker 2: right now.
Speaker 6: I'm never going to be told that I'm that I'm
Speaker 6: right and disagree with you, Max, So that's great. I
Speaker 6: do think like this idea of XAI being the true
Speaker 6: value is totally valid. There's so much potential with these chatbots,
Speaker 6: and we see companies like Meta investing billions and billions
Speaker 6: of dollars into training these large language models to power
Speaker 6: chatbots and things like that. So if you can take
Speaker 6: X the social network and somehow tie it to x
Speaker 6: AI and you know, groc or whatever else comes from that,
Speaker 6: I think that is probably the best way for X
Speaker 6: the social network to have a positive outcome financially here.
Speaker 6: And it feels like that's what's happening there. They're clearly,
Speaker 6: as Max pointed out, Grok is like X the social
Speaker 6: network is the distribution ground. For Grock. It's the training
Speaker 6: data for GROX. So I think what we're seeing here
Speaker 6: is these two companies being tied together. Not sure exactly
Speaker 6: what happens at the end of that, but you know,
Speaker 6: it feels like that's where it's headed.
Speaker 3: Enough about X and it's woes. It's time for another
Speaker 3: feud of the week? Are you just making these feuds up? Max?
Speaker 3: So these feuds are these figments of your imagination? Are
Speaker 3: they're real?
Speaker 2: No?
Speaker 4: These are these are very real. This is as real
Speaker 4: as the earth, the sky, the sun.
Speaker 3: Ok, what do you got for us this week?
Speaker 2: Dustin Moskovitz he is kind of a Silicon Valley powerbroker,
Speaker 2: co founder of Facebook, kind of a more of like
Speaker 2: a lesser co founder Facebook, very close friend of Mark Zuckerberg.
Speaker 2: He runs a company called Asana, which is a sort
Speaker 2: of productivity you know type.
Speaker 4: Thing for businesses.
Speaker 2: He is also a major donor to the Democratic Party
Speaker 2: and a bit of a left wing activist, and he
Speaker 2: over the last few months has every now and then
Speaker 2: posted something critical about Elon on threads. Of course on threads,
Speaker 2: and recently though he went way further. He called Tesla
Speaker 2: basically Enron. He said, let's wake up to this.
Speaker 4: This is Enron. They're a fraud essentially, That's what he said.
Speaker 2: Yes, the grounds. You know, I spent some time reading
Speaker 2: this very lengthy thread. He's a very verbose guy, a
Speaker 2: little bit hard to unpack. But the basic contention is
Speaker 2: that Tesla is improperly recognizing it's autopilot revenue. I think,
Speaker 2: stepping back from that, Moskovitz is jumping on to a
Speaker 2: common critique about Tesla, which is that autopilot is essentially
Speaker 2: vapor where it doesn't actually drive the car for you.
Speaker 2: It's you know, Elon Musk is overstating its capabilities. Elon
Speaker 2: Musk responded in an extremely generous and fashion by posting
Speaker 2: a meme in which Dustin Moskowitz was labeled on one
Speaker 2: dog and another dog I think labeled Elon was performing
Speaker 2: a lewd act on that dog.
Speaker 7: Okay, okay, wow, Like I'm saying, I assume a Tesla
Speaker 7: compliance officer looked at that and said, okay, this is legit.
Speaker 3: This is legit. Again. You don't know what the initial
Speaker 3: post looked like, right, I mean, I have no idea, right,
Speaker 3: So the Twitter sitter said, yeah, this didn't Now now
Speaker 3: that you've edited down scale, the back. This is this
Speaker 3: is fine and legit, to which Dustin responded and said.
Speaker 2: What continuing to he's continuing to criticize Elon Musk.
Speaker 4: I mean the feud continues, So this is.
Speaker 3: Okay, So this is this truly isn't a figment of
Speaker 3: your imagination? Just sounds like a decent fud.
Speaker 2: Look, I think that this, you know, it's it's very
Speaker 2: tempting when somebody, especially on Threads, which you know, despite
Speaker 2: Mark Zuckerberg's best efforts, does not have the kind of
Speaker 2: like cultural capital even that X does. When somebody's just
Speaker 2: like shooting, you know, random verbal assaults at Elon Musk,
Speaker 2: it's's kind of tempting to ignore it. But Moskovitz is
Speaker 2: a important guy. He is a major Democratic donor. He's
Speaker 2: somebody with real juice in political circles. I mean, there
Speaker 2: are also reasons to doubt some things that he said.
Speaker 2: He was a big you know, he's a big effective altuois.
Speaker 2: People have tied him to Sam bankman Fried. Of course
Speaker 2: he has said, you know, his brand of that is
Speaker 2: totally different. But either way, like this is somebody that
Speaker 2: like has access to the highest levels of the Democratic
Speaker 2: Party and he is going around criticizing Elon Musk very loudly.
Speaker 4: This is not a good situation for Elon Musk.
Speaker 2: On the other hand, you don't want to overstate it
Speaker 2: because like he's buddies with Mark Zuckerberg.
Speaker 3: Is it this kind of like an extension of the
Speaker 3: Zuckerberg feud?
Speaker 2: Yeah, you know, it's kind of like a tag team
Speaker 2: situation where you have a Yeah, you have Zuckerberg and
Speaker 2: and Moscow's in one quarter Linda and Elon and the
Speaker 2: other they're tagging it.
Speaker 5: No.
Speaker 3: No, that's a very good question if you do go
Speaker 3: tag team and so it's Moscowtz and Zuckerberg tagging, and
Speaker 3: I once who is who is Elon's tag team partner?
Speaker 4: I feel like Danna needs to answer that question.
Speaker 1: Oh wow, who's the guy said he was going to
Speaker 1: jump on a grenade that.
Speaker 4: Was it's his brother.
Speaker 3: But it's why we should have came up.
Speaker 4: You know who it should be though, it should be Walter.
Speaker 4: That would be a colorful fight.
Speaker 3: So Max, what I want you to work on this
Speaker 3: next week before the next episode is like you know
Speaker 3: what then, like, what are the costumes they wear in
Speaker 3: the red You've got to work on for each time.
Speaker 3: Kurt Wagner. Thank you for joining us.
Speaker 6: Thank you, thank you, thank you.
Speaker 3: Danna Mac pleasure to be here always. This episode was
Speaker 3: produced by Stacey Wang. Naomi Shaven and Rayhan Harmantier are
Speaker 3: senior editors. The idea for this very show also came
Speaker 3: from Rayhawk. Blake Maples handles engineering, and we get special
Speaker 3: editing assistants from Jeff Grocott. Our supervising producers Magnus Henrickson.
Speaker 3: The Elon Inc. Theme is written and performed by Taka
Speaker 3: Yasuzawa and Alex Sugiira. Brendan Francis Newnham is our executive producer,
Speaker 3: and Sage Bauman is the head of Bloomberg Podcasts. I'm
Speaker 3: David Papadoppolis. If you have a minute, rate and review
Speaker 3: our show, it'll help other listeners find us. See you
Speaker 3: next week.