Pivot · Jul 17, 2020

NBC's streaming service launches without Roku or Amazon Fire TV, Apple wins a tax battle, and a prediction on Netflix earnings

Automatic transcript of the end of the episode, from 39:29. Speakers are labeled by software and may contain errors. Highlighted passages are Scott’s predictions.

Scott Galloway · 39:29 So it's I worry that over the long term everyone's talking about the benefits of remote work and there is benefits, less commuting, more efficient, live where you want. But there is something to the notion that if your job can be outsourced, if they can let you move to Denver, that means they can keep going and move your job to India. And I find that delivering stuff via Zoom as a service provider is just exhausting. Okay. Kara Swisher · 39:50 Yep. Alright. I like some of it. But, know, it's interesting because Amazon announced people didn't... We didn't go... Going back to up to 2021. I think the New York Times did. So that's gonna be, you know, pretty much everyone's... Every major offices are gonna be stay at home and don't come back in for a while. So more and more people will get used to it and find workarounds that will then become permanent. I think that's very clear. Alright, Scott. One more quick break. We'll be back for predictions. [Ad break] Kara Swisher · 40:24 And we wanna tell you about Pivot, our twice weekly podcast. Scott Galloway · 40:28 That's right, Kara. What a thrill. Kara Swisher · 40:29 It's a [Ad break] Kara Swisher · 40:35 check so people can make it through each episode, whether it's digging into constant changes in the world of AI and social media or trying to keep up with whatever the fuck Elon is doing. We're here to give [Ad break] Kara Swisher · 40:51 And Scott is a prediction machine gazing into his crystal ball to tell you about where it's all heading. Scott Galloway · 40:56 That's right. [Ad break] — Predictions segment begins — Kara Swisher · 41:01 follow us on your favorite podcast app to get new episodes every week. Boom. Okay, Scott. I'm gonna do a prediction this week. Actually, I have two of them, actually. The first one I'm gonna do is is related to TikTok. You know, there's been an increasing tax on it, a backlash against it, all kinds of... Even the Democrats are piling on. I I I wrote a column this week in the Times about it, which will appear, but it's, I think they're going to spin it off. I think they're gonna... This this is sort of... Was sort of a... As as Ben Thompson at Statutory said, it was a it was a it was a sidelight thing, and now it's moved to center stage, these issues around China. I think they're gonna have to spin it off and go public in The US and just break the ties so they're not subject to the national intelligence, the heinous national intelligent laws of China. Even though there's no proof that there's any kind of movement of data to China Yeah. They can be compelled to, and even in their privacy policy that you say they could do it even though they don't do it. So I think they're gonna I think they're gonna spin off. That's my feeling. That is my prediction. Scott Galloway · 42:06 And they've signaled that. There was Yeah. It wasn't an accident they hired, you know Kevin. A big white American guy. Yeah. I think they're planning this, and I think they figured they saw this coming and said, okay. Kara Swisher · 42:17 I think it's accelerated. Scott Galloway · 42:18 Yeah, how can we come across as more globalAmerican and reduce the perceived threat and xenophobia that we kind of feel towards almost all things, Chinese or non American? So I think this was part of the reason that he was able, he's gonna be probably the newest minted CEO billionaire when they go public. Billionaire. Kara Swisher · 42:38 You're right. Anyway, that's my prediction. Scott Galloway · 42:40 That makes sense. Kara Swisher · 42:40 And then my actual prediction. So I'm gonna make a full disclosure, because I work for The New York Times and New York Magazine. Yep. And I have some personal relationships involved here that aren't worth getting into, but they're awkward. Totally Google able if you are in the mood, but why Scott Galloway · 42:55 bother? Good. I'll use some music in the background. Another... In episode four of succession, dysfunctional yet boring, the swisher controversy. Go ahead. Kara Swisher · 43:05 Go ahead. Scott Galloway · 43:05 I'm waiting. Kara Swisher · 43:06 It's juicy. It's juicy. I know it is. It is. This Scott Galloway · 43:08 week is likely. Go Kara Swisher · 43:09 on. Alright. Anyway, Barry Weiss, longtime New York Times op ed writer. Uh-huh. Not longtime, actually. Scott Galloway · 43:15 Hear your comment. Kara Swisher · 43:15 Resigned from the New York Times. She she accused the company of internal bullying of her concern. And then she's not conservative. She calls herself centrist. She also published, widely shared... And widely shared her resignation letter. Same day, Andrew Sullivan, the conservative, political writer, again Scott Galloway · 43:30 Mhmm. Kara Swisher · 43:30 Sure he's so concerned. I don't know what he is anymore. At New York Magazine announced, he would be a contrarian. I'll say contrarian writer. Announced he would be, leaving wherever the hell he is. So, you know, I had known... Heard about this through the media entrepreneur circles that there there was something they were all clipping Scott Galloway · 43:51 together. Circles. Kara Swisher · 43:52 The call circles. No. Not the call circles. That's a whole different group of people. That's a lot of guys. You know? Scott Galloway · 43:57 That's a of bad food and windowless conferences. Kara Swisher · 44:00 Yeah. Yeah. That's a lot of beer and, and Yeah. Other things. Let's get some wings. Scott Galloway · 44:05 Anyways, I'm sorry. Kara Swisher · 44:06 Wings wings and strippers. Whatever. Anyway, so I think they're gonna start their own publication. I don't know. Scott Galloway · 44:13 The Harry and L. Didn't they? Didn't they announce it? Kara Swisher · 44:15 They're canceled... The uncanceled. I don't know. They're... I think they're gonna start something Right. And be funded. I'm not... I'd be curious, you know, put maybe money from Teal. Who knows? But I think this was a was a long... I think this is a long game of PR in this regard. I don't I don't agree with her letter. I think it was missing a lot of pertinent facts, and was designed, to to to this next thing. I think a lot of people think that. And so, I predict you're gonna see a new, right in the middle of the time when lots of... Including Vox Media and others are having layoffs, BuzzFeed, and things like that, You're gonna see a newly funded organization possibly or linked to something like Joe Rogan or or this... They're they're... I think they're close. And, so you're gonna see something with, I think, probably those three, but we'll see. It makes sense. You're definitely gonna see a book deal, obviously, but it seems like there's something afoot. That's what I would say. I've heard this for months, and I I actually said it to, people Yeah. Scott Galloway · 45:18 Privately. I thought the letter... I mean, I thought the letter was well written. I do think there is. We, you know, we did a move of this. Anyways Kara Swisher · 45:25 Desperate need of an editor, but go ahead. Scott Galloway · 45:28 Well, I know one that's a cold baroness. Anyways, she's Kara Swisher · 45:31 I would not edit Scott Galloway · 45:32 that letter. They... It felt... I I would say... I don't wanna... It didn't it didn't it did actually undermine and diminish a bit of the credibility of the letter when the next day, I thought I read that they were going... They were starting a new company. It felt like kind of a press release and a kind of a means of getting awareness for whatever their new co is gonna be, but I don't think it's I think it's unfair to sort of associate it with what I think they're gonna plan to do with Peter Thiel. I think what they're trying to say is I don't Kara Swisher · 45:56 know if it's Peter Thiel, FYI. Scott Galloway · 45:57 Yeah. Know. But my point is it's it's not it's not a libertarian ban. I think I think what they're saying Kara Swisher · 46:02 is Contrarian. Scott Galloway · 46:03 Is that there's no there's no middle left, and that there's an opportunity for media that tries to place itself somewhere in the middle. The other thing that thought was interesting in our letter, and I've seen this in companies, is that there appears to be a fissure between kind of the 40 quote unquote liberals and the 40 Kara Swisher · 46:20 It's untrue. Scott Galloway · 46:21 Woasters. Yeah. Kara Swisher · 46:22 It's untrue. Those were... That's one thing she left out. She tweeted all this stuff after the Tom Cotton thing that was patently untrue, and it was... Like, 12 people from New York Times is like, we were in this meeting, and it was young and old. This is not what happened. And so that's what's left out of the letter. You know? And she's like, people called me a liar, and I'm like, well, you kind of tweeted stuff that was untrue. So they were furious at you. It was a regular editorial back and forth. It was not a civil war. There's just... It's... I am there. I I... I'm not deeply enmeshed in New York Times, but it's just untrue. Scott Galloway · 46:53 I don't Kara Swisher · 46:53 think it's not even I Scott Galloway · 46:54 don't think anyone... I don't think the people worried about that. I think they were a little disturbed when they heard that you got very angry at the letter, and you hopped in your car, and you put on diapers, and you drove thirty hours to speak to her. That's... Kara Swisher · 47:04 Oh, wait. That's not I've never met her in person. I have never... I I would never do that. I have no I have no personal relationship with this person. So Scott Galloway · 47:12 personal relationship with this person. And something tells me you're not going to develop one. Kara Swisher · 47:18 I... It's... You know, the work is not my cup of tea, but a lot of people's work my cup of tea, so it's fine. Like, I don't mind it. It's fine. Scott Galloway · 47:25 It's not your cup of coal. It's not cup coal. Kara Swisher · 47:28 But here's the deal. Aside from this letter, which I think is is problematic, I'm gonna... Is problematic. And I don't wanna discuss the letter because I don't think this is... I think there should be discussions about editorial issues within newspapers. I think that behavior on Slack, for example, is bad. You know? She noted an axe emoji. You know? I don't know. Like, let's look and let's... They should do an investigation into how people behave. But if it's just just basic, like, Slack meanness, I don't know. I don't know. I don't know. I don't know. Well, let's look at it. I say, Scott Galloway · 47:58 like, trans is just to not understand Slack, and you're not set up with any parents. Kara Swisher · 48:02 They lose their minds on Slack. Slack is demonic for a lot of people. Yeah. It's like Twitter. But having a disagreement with someone is not the same thing. And and if you... As as, you know, if you're... If you write things that are offensive and then people are offended and then you're mad that they're offended, it seems like... It's just it's just not the hill to die on. This particular is not the hill to die on for this point. Same... That's my feeling. And I... They're gonna start something, and they can... That's great. I think that entrepreneurs welcome media entrepreneurs everywhere, And it should be interesting, and and and it should be... You know, it could be called the uncanceled. The uncanceled. Whatever. Yeah. Whatever. Yeah. That's my feeling. There you have it. Now you know so much about my personal life. Scott Galloway · 48:46 This has this has very... Been very illuminating. Okay. So my prediction? Kara Swisher · 48:49 Prediction. Go ahead. Scott Galloway · 48:50 My mind is blown. I've been thinking about this all week here, and that is in the history of business, something, we record on Thursdays, and something this afternoon is gonna happen as a function of what is an unprecedented situation in business. And that is we have a company whose sales or consumption of their core product is up 38% year on year, which is just... I'm talking about Netflix. So Mhmm. The consumption or the core product is up... Consumption of the core product is up 38% year on year. Kara Swisher · 49:24 That's because it's great. Scott Galloway · 49:26 I agree. I agree. Give me some running room. Give me some running Go Kara Swisher · 49:29 for it. Scott Galloway · 49:31 But at the same time... And I don't think I've ever... I I can't name another company or another situation where this has happened. At the same time, their costs have absolutely plummeted because they're they're no longer allowed to be in production. Mhmm. So what you're about to see, and this is my my prediction, I think Netflix goes over at, in after hours today, breaches $600 a share, and becomes more valuable than Comcast, AT and T, and Disney. On on the back of this, not only their incredible success, they're up 80% since the March lows. They're up 60% year to date, just behind just behind Amazon, which I think is up 64%. But I'm trying to think of another situation where companies... It's as if General Motors said, we've sold 40% more cars, but we haven't had to keep our factories open. We've been able to close them and save money. I don't think in the history of business we've ever seen Kara Swisher · 50:24 Plus they have a backlog. Netflix is an endless well of Scott Galloway · 50:27 new content. So you're about to see you're about to see this trope, anomalous, incredible earnings surge announced today at Netflix, and they'll do anything they can to throw expenses on it to take it down because once they do fire up production again, their earnings will go back to kinda normal levels. But I think the stock is gonna pop. I think Netflix has so much momentum, and they're gonna look out ten years as the market is doing and saying this company is just a juggernaut. Anyways, Netflix, over $600 a share, close of... After the market closes today on the back of this incredible trope like notion where a a company can increase its sales 38 while seeing its costs plummet. I've just never... I've never... I I never seen it before. Kara Swisher · 51:11 Good one. We have good predictions today. That's a good... Let me just say, I agree with you. And by the way, there's so much there's so much good content. I keep discovering it, and it's quite delightful. Like, I just watched Eurovision, the Will Ferrell Oh, yeah. Scott Galloway · 51:24 I worked out with my sons. It was cute. Kara Swisher · 51:26 It was adorable. Scott Galloway · 51:27 It was cute. Kara Swisher · 51:27 I was so happy to have it, and then I moved over to another thing that was more serious. I forget what it was. But it just... There... There's an endless supply of really good content Yeah. And whatever strikes your fancy. And it's always sort of serving you up very much like TikTok. Actually, I really enjoy using TikTok. Really great product Scott Galloway · 51:44 Yeah. Kara Swisher · 51:44 Away from everything else of any of these apps. I like to focus on great products. And I think even though the costs have gone down, Netflix is great because the product is great. Scott Galloway · 51:53 Yeah. Do a fantastic job. Doubt No about doubt about it. — Predictions segment ends — Kara Swisher · 51:56 Good prediction. Good prediction from you. Okay, squat. Scott. Squat. Squat. Squat. I'm call you squat from now on. Alright. Another quarantine weekend is upon us. I know you're gonna call me six times. I know I know I didn't call you back the other night. I'm sorry. Oh, you're Scott Galloway · 52:13 bragging now. You didn't Kara Swisher · 52:14 call me back. Eurovision. That's what I was doing. Scott Galloway · 52:16 Yeah. Kara Swisher · 52:17 That's what I... I was actually... And it was so good. I couldn't stop watching adorable Rachel McAdams speak Icelandic. I just couldn't I just couldn't stop. Scott Galloway · 52:24 Yeah. That thing red light kind of bit from the from the from the chamber of commerce from Reykjavik. I know. But I love... [Ad break] Kara Swisher · 52:31 say, well, she's so adorable. I like the Scott Galloway · 52:32 of Kirsch Brosnan. Kara Swisher · 52:34 I know. He's so handsome, my handsome father. Scott Galloway · 52:36 Very good looking. Kara Swisher · 52:36 He was was really good. But, but what are you doing this weekend? What are you up to? Scott Galloway · 52:41 Absolutely nothing. I can't... I literally... Like, my mind's blank when you say, what am I doing this weekend? I'm writing a big piece or a big piece for me Mhmm. On education. I'm trying to assemble a list of which educational institutions bring this toxic cocktail of a lot of international students, low endowments, high admit rate, and high tuition with a kind of a low experience and a tier two brand, because I think there's about to be 500 or a thousand universities that'll start a death march on September 1 with the demand I Kara Swisher · 53:11 will note that Scott gave this lecture to my son. I think you were trying out your arguments on my son who asked about NYU. Thank you for doing that, by It the was very helpful. Scott Galloway · 53:19 It's my pleasure. And I kicked off my latest Professor G strategy sprint. So I'll be doing my first class on, not this weekend, but Tuesday night. I got 1,000 students that Wow. All online. That's exciting. So, yeah, just doing That's doing my gig. Good. Doing my gig. Kara Swisher · 53:33 I'm gonna install baby gates. I'm not Baby gates. That's what I'm doing. Scott Galloway · 53:37 Baby gates. Kara Swisher · 53:39 I'm installing baby gates. That's where my life is right now. Nice. Don't forget if there's a story in the news that you're curious about and wanna hear our opinion on, email us at pivot@voxmedia.com to be featured on the show. This was a really good show. It was full of information. I really have liked your analysis this week, and I really appreciate Scott Galloway · 53:54 Thanks. Kara Swisher · 53:55 Anyway, read us out. Scott Galloway · 53:56 Today's show was produced by Rebecca Sinanis. Fernando Finite engineered this episode. Erica Anderson is our executive producer. Thanks also to Drew Burrows. Make sure you subscribe to the show on Apple Podcasts. Or if you're an Android user, check us out on Spotify or wherever you listen to podcasts. If you like the show, please recommend it to a friend. Thanks for listening to Pivot from New York Magazine and Vox Media. We'll be back next week for another breakdown of all things tech and business. Go Netflix. Have a great weekend. Care.