Brian: By the way, how's Canada?
Ha How are your relatives handling this?
Troy: pissed, man.
They're
Brian: I know they really are.
Like, this is like,
it's kind of crazy.
Troy: Don't poke the beaver.
Brian: Okay,
on that note, let's get started.
I always forget to say welcome to people versus algorithms show about
media, technology, culture.
I'm coming to you with AirPods joined by Troy Young and Alex Schleifer.
I wanted to start this week by talking a little bit about abundance.
Have you guys, I, I got my copy.
I haven't started reading it yet.
It's a new book by Ezra Klein and Derek Thompson.
The DC dork set have been waiting for this, like with bated breath, like, and it's landing at a great time.
Right?
Because the whole book is about how progressives in, in particular need a, a more positive agenda to put forward
to counter obviously what they're losing right now, which is supportive people.
One poll that came out recently had the approval rating of the Democratic Party at 27%.
That's low.
That's not good.
So they're advocating for a pro-growth, progressive agenda that shifts away a little bit from redistribution and,
and focuses on building more, more housing, more infrastructure, more energy, more innovation, et cetera.
And.
I think this is an interesting marketing challenge and I wanna sort of then weave
it into the media industry, which I think needs its own abundance agenda.
Troy: I thought I had an abundance agenda already.
Brian: Well, I think it needs a different abundance agenda.
There's, there's an abundance of like SEO content.
That's true.
But
Troy: that Alex, were you in the 27% in support of the Democrats?
You found that they're doing a good job?
Alex: Yeah.
No, I, I was, I wasn't, I don't think that I'm, I'm not surprised.
I think everybody, even people that will 100% vote Democrat don't seem to be happy with them.
I'm surprised that they're, I'm surprised anybody can say that they're doing a good job.
Like whether, you know, I mean, whether it was like Schumer agreeing with Schumer or not, it was just all a mess.
They don't look aligned on anything.
They're not reaching out to people.
They seem confused.
The Gavin Newsom podcast, like they seem entirely split on, on that as a strategy as well.
It, it, you know, meanwhile, I think the Republicans look like for whatever it's worth, are totally behind the sky.
So it, it, you know, it looks weak.
Troy: Hey, do you think the book I mean the timing is extraordinary.
What a, what a what a dream for the publisher and for,
Brian: And a great duo, you know,
Troy: it, for those guys, but maybe it should be called The Naive Agenda.
Yeah.
It's like, well, these are big ideas, right?
To, to shift, you know, our thinking to a build mindset, to outcomes, to
making you know, this, to, to, to making government effective, right.
Making the bureaucracy effective, but like, has it ever been effective?
I mean, isn't like, it's great if, if the government can, can, can make more
things for more people and make more people happy and we can do all the things.
I mean, there's complete alignment on many levels with what I, what what Ezra would say is that the, there's, there's a
kind of a build priority or kind of build agenda, and then there's the mo moral kind
of decision making that informs, you know, what is the right thing to build and do.
And that the liberals are, are better equipped to make good, good kind of moral decisions.
But like it that it feels like.
Ni it's just like shockingly naive to me.
It's just like, I, I, I, I want, so we're gonna make, I mean, I guess if you look at it in a broad historical
context, faced with urgency in, you know, fighting a war, coming out of a war,
you know, putting a person on the moon, we've seen the government activated.
But, and maybe, maybe there's, we just have to admit there's way too much plaque in government right now.
And so we've, we've set kind of rule set upon rule set, which has prevented us from, from, from doing anything.
But I, I get it well timed in all of that, but does it, does it feel just naive to you?
Brian: I mean, I don't know if it feels naive, like I understand saying, well, it's impossible to do.
I mean, the government has, you know, created an interstate highway system.
It did.
The Man on the Moon thing, it, it's done a bunch of stuff, won some wars and what and whatnot.
Troy: No.
Wars are good.
Wars are good for mobilization
Brian: Yeah, it's good marketing.
Alex: Look at what's happening to Canada.
Brian: yeah,
people are coming
Alex: Yo Europe.
Oh, Europe.
I mean Europe.
Europe's never felt as United.
Brian: to me it's more about putting, putting
Troy: but if Donald Trump hadn't have come along and I'm not like supporting Donald Trump, I'm just saying that if he
hadn't been this free radical disrupting the way we think about all of this, would, would this moment have arrived?
Brian: No, I don't think so.
I mean, because this is like, you know, usually political parties need
to be cast out into the wilderness in order to reform themselves.
This is just a Right.
No.
Otherwise they're like any bureaucracy, they're not gonna change unless forced to change.
And so that's an interesting time and that's why this is like setting off what's kind of been a delayed
civil war to me within the Democratic Party about what it really wants to
Troy: dude, I think this is problematic.
Basically what he's saying is outsourcing right to contractors, creating this gigantic, you know, outsource bureaucracy
where government is used as flow through contracting requirements that have made it impossible to get anything done.
And the ability to sue people has created this stasis in government.
And what Ezra would say, the best place to listen to him, I think
is prob Did you guys listen to, he was on Tyler Cohen's podcast.
He's been all over the podcast world.
Ezra has doing the rounds.
but he's like, I love Doge.
It's just, I think that they don't have to do it that way.
It, you know, like, it becomes a question of how not what they're doing, the work that they're doing is important,
essential, but like, they're making, you know, they're bad people making,
you know, some questionable decisions, but like, that thing is needed.
I don't know.
I, I think it's, it, it's, it's, it only feeds into the, kind of, GOP agenda.
Alex: You think the book does?
Troy: I think that it's hard for people to say, well, yeah, you gotta radically
downsize and disrupt you know, government and bureaucracies, but do it nicely.
I, I just don't, I don't know that it's ever done nicely.
I.
I don't think you can.
Alex: Yeah.
Yeah, I know.
But there's, there's I mean there's doing it not nicely and there's doing it with just like a, a bludgeon the
way it does now, and with glee and with, you know, holding chainsaws.
I think people are getting
might get a little tired of that.
Brian: There's the reality show aspect to it, right?
I mean, I think that's part of the marketing, you know?
Right.
Like, so I think to me what was interesting is less almost the substance of it and more as a branding.
Exercise, right?
Like you have to brand a party.
And like in America, you're basically, this is a product you're selling to do all of America.
And generally this consumer market needs some kind of coherent vision right around,
and you can't just be for a bunch of collection of niche special interest.
Issues and you need to come up with some kind of underlying philosophy that you can then package up and sell.
And like Trump has been really good at spectacle, he's been very good
at very simple messaging that breaks through to low information voters.
And, you know, we talk on this podcast all the time about the information
space and the decentralization of media and all of the implications of that.
And I think there's a lot of sort of similarities between what the
institutional media world faces when, with what the Democratic party faces.
I know there's sort of thought of, at least on the right as intertwined,
Troy: That's a
Brian: really they, they do need to come up with some kind of positive agenda.
And I'm often thought struck by this.
I wrote about it a little bit today about how so many publishers are so mired in
cost cutting and in rationalizing their businesses that they're depressing.
They're depressing to talk to, they're depressing to hear from, and, and it's just like, I, people say that, they're
like, I sometimes people are like, oh, wow, you're so, I'm like, you.
Like I'm not even negative.
This is a thing.
Like, this is, and it, when you don't have that sort of positive viewpoint, people don't really, aren't attracted to you.
I mean, like
Troy: You know what?
Having you Brian Morrissey be a cheerleader for the publishing industry is really bizarre.
I mean, given,
Brian: mean cheerleader?
Troy: I mean, how, given my history with you, I used to have this
argument with you about being a cynical bastard all the time.
I would march on over to the Digiday offices and
Brian: I was just being clairvoyant.
I was just being clairvoyant.
Troy: But, but you know, it, it, it should no longer come a surprise to anyone that Donald Trump rolls outta
bed in the morning and thinks of the most outrageous thing that he can
say within the kind of boundaries of a broader platform and philosophy.
And even this week, like I'm Canadian, obviously, I tune into some of these things, but, you know, repeatedly calling
it, you know, you know, governor Trudeau, the 51st state, they would be better off if they just like gave it all up.
We're protecting them anyway.
We don't need anything from Canada.
And just like completely doubling down on something that clearly, you know, I would say in lots of ways is
I, I is, is not being well received other than it's an incendiary message
that, you know, people can, that will win the media battle that day.
It's insane.
Alex: if, if, if you look at Ezra client's book, by the way, great beard, huh?
Like the, whoever told whoever, like,
Troy: He's handsome now.
He's
Alex: oh, he, oh yeah, he's hot.
Troy: jacked up too.
He is all ripped up.
Alex: yeah, he got, he got ready for this press tour.
Uh, I, I, I think, I mean, you read that book and it's like a good strategy,
Troy: Wait, you read the book?
Alex: no, but let's say, I mean, you, I'm saying you,
but, but, but essentially, right?
Isn't it like.
You know, spend more on infrastructure, just like reduce, like, any
kind of like, what is it, like regulatory stuff that slows it down.
Infrastructure, infrastructure.
Stop fighting between each other and let's get this done.
I mean, that, that sounds like a great plan.
It, it is just, I, it feels like the way people are reviewing it is that in today's world of messaging and the
way Trump messages things and the way everything's just like, fucking trash fire every day, that's not going to reach out.
And I don't think the, the plan doesn't seem to be read on its merits and people don't think the Democrats can
win with it because it is not a media strategy in for today's world, right?
should, should the, you know, V 3.0 or whatever we wanna call
it of the Democratic Party, be something that's more of like a.
A beast that's more capable of fighting Trump in his arena?
Or is it or, or, or should it be about like, Hey, people are going to get tired of this shit, you know?
And, and, you know, maybe just like a reasonable plan is what we'll want in three years.
Brian: I think the case for that is that, you know, I think Tesla is down on like 30%, like, on the year.
Alex: I track it every day in the morning.
I, I watch it when I
Brian: you wake, that's what you first do.
You
Alex: That's
my, I, I, it's wonderful.
Brian: obviously
Troy: you're gonna be attracting the lucid stock,
Brian: this
is very tied to
Troy: a, it's a, penny stock.
Brian: Elon Musk's role in Doge.
And, and the fact that the spectacle, right?
Like there's only, there's only there's only so much I think people can take with, with the spectacle of this.
I, I suspect as always that they're overplaying their hand here.
I don't know.
Time will tell, I
Troy: Listen, if someone told me that you could align a more reasonable moral agenda, a more
reasonable liberal agenda with a high functioning government, I'm all in.
I'm in.
You got me.
I'll, I'll, I'll walk with Alex to the, to the voting booth.
but in the
Alex: can't, I can't vote.
So, you know.
We'll, I'll just watch you do it.
Troy: okay, you can drive me in.
You're lucid.
but in the meantime, I, I just, I, I, I can't see it, but good on 'em.
I mean, they're desperate.
Alex: But what is it?
What, what, what, what is it that they do?
I mean, I, I think for me,
Troy: is it that they do?
Is, is a, is a really good question.
Alex: I, I mean, you know, the, the, the only thing, the only kind of messaging that I've seen breakthrough
is like, you know, cyber trucks and fires and, and free Luigi.
You know, it's like the,
the rebellion.
The rebellion seems to be
Troy: you know where it's gotta go, Alex.
And, and, and I think this is just inevitable and it has to go to a pro technology message.
It invariably you know, AI is going to massively change how services are delivered through the bureaucracy and
the party that is best able to convince voters that that's in their interest, then
they can actually affect that is gonna have an advantage, but it has to come.
AI is the substrate on on, on which the new
Alex: but people don't see that as a win.
Like people
Troy: I mean it's early on that message, I miss saying it will go there.
Part of the conversation between Tyler Cohen and Ezra Klein was that like.
Tyler was just saying like, you gotta admit that, you know, you're, if you, if you were to fund something like the new
USAID or whatever government department you wanna talk about, you're gonna be able to do it with a couple hundred people.
And they kept saying a GI.
It's interesting to me that a GI has become part of the lexicon as being not speculative, but real.
Alex: But it is, it is, to be clear, it is entirely speculative.
We don't know if we're
Troy: Right.
But I'm, I'm just saying that, that the Tyler throws it around.
Like it's not if that's, it's just when,
Alex: Yeah.
That, that, that, that type of talk is crazy though.
It's, it's absolutely crazy.
The, the jump from a GI from what we have today to a GI It is, it is so massive and I, I know that I'm like the
a usually the, the, the AI pusher here, but that, that type of language is really not useful Because we have yet to see
like large scale you know, use of, of the current generative AI models in ways
that are reliable enough to get anything done that's, that's particularly useful.
And so I don't, I don't know if that's a great messaging.
I think, I think we see it when we see it.
I think if anything, this type of talk, it needs to kind of be underplayed and, and maybe brought into a
conversation about the modernization of document of, of government for efficiency using technology.
I wouldn't use AI at all.
Troy: That's what I'm saying.
I, yeah, practical.
You're right.
But thank you for clarifying.
Okay.
' Wow.
That's about as political as I'd like to get Brian, you know,
Brian: but like, no, I want to tie that because like, I think that the, the sort of counter to that is the look backwards.
And I see a lot of that in the media industry.
A lot of nostalgia.
And I like, I like some of nostalgia.
I did not get to enjoy the 19, 1990s magazine industry.
But there's a lot of
Alex: That, that's, oh, that's the chip.
That's where, that's where the chip on the shoulder comes from.
You see, Troy did, that's why he has, that's
Brian: Troy, I, I don't know, do gray, I, what was Montreal Magazine?
I don't know if there was that much.
There was no
Troy: Oh, nineties magazines.
I, no, I, I got there to refactor them.
Alex, I made a lot of money in the magazine business, but I, I was there to break it, not, not to fit, not to
Alex: You were the original, like you were the Dojo print media.
Um,
Brian: much.
Alex: but,
Brian: But Grayden Carter has a new book out about the, the, the sort of heyday of magazines.
Michael Greenbaum New York Times Media editor, I believe is he has a Conde Nast history coming out.
I, Troy, I think you shared that guy's tweet about making $500,000 for three, for three magazine story
Troy: And this was in, this was in the nineties.
That's a lot more than $500,000 today.
Brian: wrote today, I was like, I, I'm every single freelance.
Magazine writer today probably read that with the same face that
the Rick character had during that monologue on White Lotus as stupefied.
Because that's the, that's the alternative, right?
And, and that's why there needs to be some kind of positive and dynamic agenda, not just managing decline.
But Troy, what, so you, you wrote in the, in the PVA newsletter, and we talked about it a little bit
last week about, about this idea of franchise value and and how most, not most, I'd say a lot of particularly
publishing brands are sort of moving more towards the right, they're moving into survivor category or arbitrage.
And that's just, it's not, that's, that's the point I'm trying to get at is like, that's not very inspiring.
You know, you're not going to track the best people to an industry that's managing decline.
At the end of the day, I know media always attracts it, but I like that to me is, is like a fundamental challenge
is how you get out of triage mode and start to paint some kind of picture of
growth at the end of the day and not just financializing these assets in quotes.
Troy: Right.
What's your question?
Brian: Well, how do you do that?
Troy: Uh,
what, What, a great question.
Good question.
Brian.
Um.
Brian: That was always when
Troy: Well, I find it just for a moment.
Can we pause on this?
Like that you're making a couple hundred grand a story and that the,
the, the, the Vanity Fair as a whole was, was nicely profitable at the time.
And, and that in order to get there, in, in, and, and by the way, paying
lots of people, including like, I mean, just amazing cost structure.
You know, Annie Leitz shoots crazy, crazy, you know, expense lines, all that.
And you have the premium, the perception of premium and the massive benefit of, of complete access.
The best writers, the best photographers, such that your, your ad rates, are so high and advertisers are willing to pay a
premium that you can still run a run a, a profitable business, one that's leveraged.
Magazines were beautifully leveraged because you made one
thing and sold it over and over and over and over again, right?
Like it was a really nice, that's why media when it works is so beautiful because it's, it's a
Alex: And that's why, and that's why software is even better.
Troy: Yeah, it, well, it's the same idea, right?
And it's all about mar marginal, marginal revenue and marginal profit, not unit costs.
So, yeah, no, I, I long for those days and I, and I, I, I sort of, came
into the business with the attitudes and cost structures of those days.
So, you know, I, we had, I think in the US 22 or 24 after the Rodale acquisition, something like that.
You know, magazine brands and, you know, more than a dozen publishers
and, you know, 20 plus editors, all that made really good money.
And you know, facing a market where I would say that the talent was way more highly leveraged in digital media.
That even the senior people in digital me, media companies that, that magazine
people looked down their nose at, made you know, far, far less money.
And now we're, we're completely on the other side of that where, you know, the, the businesses just aren't
sustainable anymore and are really being harvested for, you know, what is really great IP value in many cases
where these, you know, brands have built up, you know, that, that kind of brand equity over years and years and years.
So, I don't know, I don't know where you see this kind of leverage.
I think Brian, in something like a podcast like, you know, your friend,
kara Swisher you know, came out and said she's making $20 million a year.
You know, we know that the p and l is, you know, decent over at Vox Media on their, you know,
Alex: How are they making $20 million a year?
Troy: How is she, you know, I, I, I don't know what that particular podcast makes.
I know it's really popular and I don't know what else she does to make money
you know, speaking gigs and, you know, she has a couple podcasts, all that.
My point is, is that something that has the cost structure of Pivot makes a lot of money because it's 10 people,
you know, and so, so you do see that media leverage in, in those kinds of business.
You see it with creators.
You just don't see, you know, it at an industrial scale.
Brian: Yeah.
I think what I, I was listening to Sarah person at the PCEO and she was talking about revenue per head.
Like I think that is like an interesting metric for a lot of these businesses
and how you get that to fine, you're not gonna get it to Nvidia levels, but.
You know, e during the last year, it's like, it would be like
$200,000, you know, revenue per employee at some of these companies.
And when you look at,
you know,
Alex: to be clear, that's very, that's very low.
Brian: Yeah.
Punch bowl is like a million.
Right.
And that's sort of where I think a lot of these businesses go, where the numbers of
Troy: Until they get judged.
But yeah,
Brian: well that's what I mean, like, I mean, you, you have to get that
efficient in these, and you can, in some of these businesses, they're just
Troy: my point is, is that they tap the rich veins of government to drive
high subscription prices, which is why they have a million dollars per head.
Brian: you think that the punch bowl, well maybe, I mean, I don't know
Troy: Yeah, I think they probably run a good business hats off
to them, but I think they have a nice subscription business
Brian: there's leverage in a lot of these different like businesses.
I did, I have a podcast coming out with the dude.
Perfect.
CEO
Troy: making, you have leverage in your business.
Brian: I mean, per employee, it's, it's a very, it's very high.
Troy: It starts to smell
A little like a million dollars probably.
Brian: there's, there's, there's a lot of, I gotta smear myself in many
directions, however but no, but I, I, I did it with like the, do you know dude?
Perfect.
Alex: yeah.
Brian: The, they, you know, trick shots.
They started Texas a and m students, I guess in 2009, they uploaded some, you know, video
Alex: Yeah.
Try try to bounce a ping pong ball into a red cup
Brian: So, early early mover advantage.
I mean, they had like 73% margins.
Like
Troy: Well, sure.
Alex: ping pong balls are cheap.
Brian: Yeah.
So it's not like media is a terrible business, but then you look at like, some of these old sectors,
you know, the New York Times now represents 7% of all US newspaper jobs, like just the New York Times
Alex: And it's interesting how much of, how much of that, if, if
you took out like games and stuff like that on top of it, right?
Like it would probably be higher.
Brian: You know, and even, but I mean, some of, and particularly really strong, like some something
like The Economist that's not that big of a company really, you
Troy: 300 people.
300 in the newsroom.
Brian: yeah.
I mean, to to cover the whole world with that, that's pretty effective.
I thought.
I was like, that's pretty impressive
considering the
Alex: is the Economist a good business?
Troy: It's a profitable business.
It's probably 10%.
Alex?
Alex: Okay.
Troy: mean, it's, it's, it's a, it's a one of one.
It's, it's definitely back to Brian's original, original question, it definitely has on the continuum from
franchise value in the middle survivor on the far right, arbitra ar arbitrage.
It's a franchise business.
It's a business that can't, that has, I think pricing power, market power, emote a global brand prestige
and through all of that just has a kind of associated economic benefits.
You know, I I, I think that they, they have a rare luxury of being able to employ 300 people's, a big newsroom these days,
it is among the handful of media businesses that still have franchise value.
Brian: And then, I don't know if you saw this week, but the skim.
It got traded.
Now, this would've been big, this would've been big news about like 10 years ago, or less than 10 years ago.
But it was just kind of like a footnote.
Ziff Davis acquired it, which is firmly, I believe we can say, on the right side of, of your continuum.
Correct.
Troy?
Am I, am I being
Troy: I mean, we, we would put them between Survivor and arbitrage.
Yeah.
But
Brian: okay.
That's,
Troy: them in the bucket of Vivec is kind of a genius
Brian: Yeah.
No disrespect
to the
Troy: that business, I think enviable from a profit perspective,
if they're stock prices lagging, the market doesn't like it.
It's a really complicated business.
It has a lot of weird platform dependent shit in there.
But he's like, you know, the garbage man of the industry.
That's unfair.
He's the
uh,
Brian: Uh Oh.
You know what they say in Washington, a gaff is when you tell the truth.
Troy: No
he is like the Fred, you know, he, he's of the Fred Sanford of media.
Brian: It keeps getting better.
We should have it back on.
No.
Look, a lot of brands have, have, have gone that have maybe I would say lost their luster a bit.
You know, Mashable, quartz, et cetera.
You know, it's part of the life cycle.
Um, Cnet went over to
Troy: PC Meg is what started it.
Yeah,
Brian: yeah, they operate these businesses really well.
And but yeah, I mean, that to me is like, it's gonna end up becoming the skim is another sort of cautionary tale.
Do you know the skim
Alex: Well, I was gonna to say, I'm, I'm, I'm embarrassed to like, not know the skin.
What is the
Brian: No, that's okay.
It
was,
Troy: they're, they're really tight, you know, kind of sultry pants made by Kim Kardashian.
Exercise, wear athleisure.
Alex: I'm wearing some now.
Brian: No, it is a, it is, it was one of the original sort of email companies, it was an email newsletter
for young women that would summarize the news in a very relatable way
Troy: It inherited the legacy of Daily Candy.
Brian: if Daily Candy was the original that would've been like a talk about a business that
Alex: So it was a, it was a, it
Brian: at a
different time.
Troy: it was one of the original newsletters built a big list.
They monetized, they kept going, and then
Alex: but like
Brian: They raised $30 million.
30 million for a newsletter.
That was
Alex: I mean, I mean, you know what, but honestly, if I heard that today, I wouldn't be surprised because we're
hearing of some newsletters like Lenny's and stuff like that, reaching, you know, a million subscribers.
I mean, I wouldn't be surprised if, if you told me today one of these
Substack newsletter raised 30 million, I wouldn't be surprised, you know?
Kara Swish, Kara Swisher is making 20.
And I know most of that is, is podcasts are much more viable than newsletters.
But how doesn't like selling to, so explain it to me because I, I, I hope there are people in the audience that
are as up to speed as me about this, but isn't selling to Z Davis kind of like, you know, going to a farm upstate,
Troy: I, sorry.
Alex: like, I don't know.
You know, when you tell kids the dog went, went to a farm upstate, like isn't it like
you, you kind of, it sounds nice, but it really isn't.
Brian: it, it's def it's definitely on, on SEO Glue factory highway.
Alex: maybe it's not, he's not a trash
car.
maybe he's just com composting.
You know, it's a, it's a recycling factory, but, so, so, but it doesn't sound like a great exit.
Right.
Brian: Look, they have a playbook.
They have a, right.
I mean, is that fair?
You know the business better than I do.
Troy, they have a playbook, then they're gonna run the playbook.
Troy: they're gonna do what they do, which is central infrastructure, very business-minded GMs.
Manage the business extremely, you know, tightly.
And, you know, I, I, I think that these days you're better to be on the side of, you know, buying stuff cheap than
buying stuff expensively and hoping that you're gonna maintain or create premium value or franchise value.
So it's smart.
It's, you know what, it's, what is it?
It's a 3 million email addresses and decent readership.
Why not?
Alex: Oh.
They raised 30 million on 3 million email addresses.
Troy: No, they
raised
Brian: no, they've been shrinking.
So I mean, you know, this
Troy: Used to be five,
I think.
anyway, it's not that it's, I hate to be a dick here, but it's not that interesting.
Brian: that says it all,
Troy: we should, we should, we should just fucking move on,
Alex: Yeah, I think we're all
Brian: all right, let's move on.
that's that's fine.
That's fine.
This was something that was brought up by by ab he talked about this acquisition that, that just happened.
But to me, what was interesting is this idea of, you know, we're really past the era of, of keyword targeting.
I mean, keywords were like.
Sort of, they built the search advertising ecosystem.
It's the one sort of home run of digital advertising really.
And now we're moving to a world where you just described your
perfect customer and then, you know, it's, it's the outcomes era.
And, and that's, and that is the, you know, describe your
perfect customer and then let the machine go find that customer.
I, I think that's gonna be, I mean, I don't, I, I wanna have a positive agenda for publishers, but like,
that's, that's a very attractive proposition for just about any for just about any marketer, I would think.
And that's gonna have major impacts, you know, as that happens throughout the entire media ecosystem.
Your thoughts, Troy?
Troy: Sorry, I was texting ab, what was the question?
Brian: Basically about like, you know.
Moving beyond keyword, keyword targeting and, and moving into just describing your perfect customer and
then letting the machines do, do, do the work and how that's gonna have a massive impact on the entire ecosystem.
I mean, this is sort of where we've been going with P
Troy: um,
yeah, I, I think that, that it will happen.
But marketing as, you know, like everything that's scarce in the world is a zero sum game.
So e eventually, if that's an effective acquisition method, it just gets priced into your cost of goods sold and prices
go up and it benefits the people that own the algorithm and the distribution.
And, you know, then people get forced out because their roas or their return on ad spend gets to a place where
it's not economically sensible to, to keep spending more on a customer.
But we're already there.
We're already there with like automating acquisition in, in
effect, turning marketing into distribution as, as a, as a COGS item.
So I, and I don't, I don't really think that changes anything.
You know, what's it called?
It's Google Max or whatever, or, or, you know,
meta, meta has their own version of it.
And to me that's at the scale level, that's gonna be a cost of entry.
And you're gonna see people, like, I know that Neil was, is really encouraged by his, what is this thing
Brian: Decipher now.
Decipher Plus, that is, that was actually very interesting and that I just
Troy: Well, is it in, is it interesting?
I mean, it, it, it, it is interesting in that good for Neil.
He's realized it, it, you know what it is?
Well, I will describe it.
It's, it's an ad network owned by a publisher that attempts to use non
cookie data and give you something that rivals or builds on contextual ad
placement
Brian: it's intent data.
Neil would, Neil would, would brand it intent data,
Troy: Great.
So where it starts is publishers like Neil have a lot of clicks on Buy Now buttons
and, and pages in his portfolio that show where consumer's interested in a product.
Right?
Alex, you land on a page that says Best Air Fryers, you know, for someone in Northern California or
whatever.
And so you know, that is a light signal or a strong signal depending on how
far down the funnel you go to say that you're interested in air funnels.
You start to, or air funnels, air funnels, air fryers, and then you put that into your DMP and you start building a profile
around the consumer that says that they're interested in X, Y, and Z. And
you do that over enough pages and you can get a good, good profile of someone.
That's what he's building.
And now, like everybody in a publishing business of that scale would wanna do is
say, it's not only useful to us, we can target customers on your pages as well.
Right, so you can become part of our ad network.
Not dissimilar by the way, to what Vox does with their ad network, which is called it's called
Brian: I need to be able to
Troy: So it's logical that he's doing this because back to the franchise value to arbitrage, you know, big picture
is, you know, Tash Meredith isn't gonna sit pretty on that continuum, right?
All recipes.
Brian: I, I mean, I will say this, I've been very impressed that by, you know, because they're publicly
traded, you know, they report their grids and they have defied a lot of these headwinds in many ways.
Now they sort of divide out their core properties from, I mean, God forbid if you work on one of the
non-core properties and they're just telling the world like that, you know,
Troy: he's good.
He's good.
He is smart.
He's good leader.
You know, there's good assets in there, but big pictures, there's lots of pressure on the business.
You wanna have him back on?
Brian: So you're not that bullish on Decipher Plus.
I just think it's good that a publisher's even coming out with stuff
like this, I mean, my bar is fairly low at this point because like all,
Troy: I
Brian: mean, I joke with Mark Stenberg all the time about, I'm like, my God.
Like another layoff story.
Like
Troy: I love it.
Brian, I love your optimism.
I'm very optimistic.
Brian: in Miami for the LA for two days.
Troy: No, it's just the turnaround is astounding.
It's astounding.
'cause I would've walk, walked into your office talking about decipher and you would've crapped all over me.
But you would, you would've said something like, but isn't it just an ad network, isn't it?
Brian: It's a managed service provider.
That's what you would tell me
And I would say, right, an ad network.
On Happier Note, did you see that one in four programming Jo Jobs has, has, has vanished.
Apparently that's the new, that's the new metric.
Is this gonna be like the sort of metric for all of the, for,
for so many of these different fields, like one in four go away?
Alex: I mean, programming is pretty
Brian: happens.
Alex: only
job that can be pretty efficiently replaced in parts
by AI today.
You know, I'm, I'm not a believer that like maybe as many jobs will be replaced by as, as are being touted now.
Like, programming is so specific when you think about it.
It's really like people who talk to machines and we've invented this new language that supports that tasks really,
really well because, you know, programming is, is a contained number of, of things
that you just put together and you can run it in a computer and see how it works.
So yeah, I mean, I see it, I see it, I see it coming from for, for programming or engineering pretty rapidly.
I think there will be all sorts of job built around computers.
You know, it used to be like the job used to be to be able to like, think through math problems and put them
into punch cards and then, you know, people invented languages that became closer and closer to human language.
And now it's just, it's human language.
But you still need a very technical mindset and, and to, to make anything worth of value.
It's just you need less people,
Troy: It is just that, you know, when your mom would say, oh, what does your son do?
And your mom would say, my son works in computers.
You can't, you can't say that anymore.
' cause everybody works in computers now.
We're all just computers.
Brian: Yeah, I had an Uber driver the other, the other week who was,
he was a student, and my wife was like, oh, what are you studying?
And he was like, he said, oh, programming.
And I was like, oh, well then you'll have like lots of job opportunities.
And I was like, gonna speak up.
And I was like, no, I'm not gonna do it.
Troy: Yeah, I mean, I, I, I guess the answer that, that you're looking for is we're all gonna be more technol,
technologically leveraged, I would say, Alex, and yeah, you can't, you can't build a system just by like typing an engli,
like an English language request into an LLM and getting some software back.
You can't, you still have to understand interconnectivity between different components.
You have to understand system design.
You have to understand databases.
You have to understand relationships between you know, different parts of the system.
Like these.
Jo, this isn't going away tomorrow.
This
Alex: The jobs are the jobs that I think, I think, I think working in
computers, like our moms used to say you know, those jobs are changing though.
I think there was a massive jobs, which was pretty low level engineering at the top line, right?
So a lot of people building interface stuff, front end stuff,
stuff that is pretty basic, but was being rebuilt over and over.
I think some of these jobs are going away.
But I think with the demand scaling up there's still, you know, there's still people like putting those servers
together and configuring everything and making all that stuff happen and
Troy: take five people to make a website.
Alex,
Alex: yeah.
Yeah.
No, and, and, so I think the demand's just gonna become higher, but it's just that we're becoming.
It, you, a few decades ago, you needed to be somebody who knew how to use a computer to use a computer, right?
Like, today, we all have a phone in our pocket.
That's fine.
And then it's, I think it's a pretty natural progression.
what I don't like is that people conflate that with replacement of jobs across many other industries.
I think, I think there is definitely some risk in the creative arts.
And it's very strange because like bo, like the way generative AI
works it, it can create art which is very non-deterministic, right?
Very yeah.
And then it can, it can also replace people code, which is very deterministic because it's, it's easy to test code.
But then everything in between, all the other jobs.
I think it's, it's, it's a lot, it's a lot harder to see just a direct path of like,
Brian: Okay, so you're saying this is not like.
This is not like a harbinger of things that come to other professions,
but this is, it's fairly unique to programming because it's so
Alex: I, I think it's very subtle.
I think we have, I think there are a few minor technology miracles that need to happen to even, you know, I, I, the way I
see a GI is like speed of light, you know, like we can get close to it potentially, but, but I don't think we can, we can
you know, I don't think it's certain right now that we can ever reach it.
And the systems will become smarter.
The systems will become more specialized but it is not a, a direct line and it won't impact everything.
Similarly, meanwhile, like we're still not seeing enough happening around making these systems more reliable.
And I think unless they become very, very reliable, a lot of stuff that,
people talk about is kind of, is, is is a flight, you know, it's like, is vaporware.
The, the challenges right now, and what I find very frustrating is that all the AI companies to, to keep their kind of their
value up and to raise the insane amount of monies that they need to burn to compete
including open ai, have to be parabolic in the way they talk about stuff.
Because you can't raise, you know, if you open ai, you can't raise $40 million that you're just essentially
going to put in an incinerator if it's just going to be like, yeah.
And it'll, you know, it'll generate emojis faster or it'll be able to write a book better because there's no money in that.
So they have to talk about kind of these incredible age agentic
systems that will do all these tasks for you and stuff like that.
And, and we're not we're nowhere near, like, we're nowhere near in that, in that area.
So I. You know, I, I'm not saying it won't happen.
I think, I think there just needs to be a little bit more of an intelligent conversation around it.
And engineering programming is, is is exceptionally kind of geared towards
being able to be replaced by AI or, or fundamentally changed by ai.
but maybe just that changes a lot of stuff because it means, you
know, software keeps eating the world, but at a much faster pace.
And other jobs get replaced by stuff that isn't ai but was facilitated because all of a sudden, you know, a bunch of
people starting creating a bunch more software and that software replaces jobs.
You know, if I'm making any sense here, I think the conversation needs to be a little bit more nuanced than it is today.
Does it make
Brian: You know what I've been using AI for lately.
I, I started a
project for, yeah, companionship.
But actually it's partially that because I started a project with.
I think I've mentioned it here, like I write this, this, I've been writing this
journal for the last two and a half years where I just write every day about like
business, what's on my mind and stuff, and it was just useless data.
Little did I know, I upload all of it to a project with like my p and ls from the last few years and it's
like this financial analyst that is this business analyst that I'm, it, it gave me all kinds of different things.
I mean, I think the problem is, it's like, what I realize with this when I ask it to like analyze things is
it's spitting back at me, just my view of the bi, like I'm not getting
a different view, but it's sort of packaged as if it's like a consultant.
Who knows, you know, like in consulting deals, it's like, well, just tell me what the result you want
because like, that's why I'm here to, you can use it like internally.
Alex: Yeah.
to
Brian: basically.
Yeah, yeah, yeah.
It does.
It validates your own, like my own thoughts.
I don't, it's not very, it's not unbiased.
But it is, I, I, I find it useful for sure.
Troy: I had two items that I wanted to bring up and one was really an extension of what you guys are talking about.
By the way, Alex, one thing to watch out for on the LLM progress side, or I think there's a lot of conversation
this week around model context protocol, MCP, which there's a client and a server, and essentially standardizes
like HTTP connections between LLMs and databases and other services, which
makes it easier to plug in different LLMs to an end up like a service stack.
And we'll, we'll kind of start to facilitate more.
Practical agent behavior from, from, from LLMs in, in a way that I think is, is a, and, and, and all it is is, I'm not
trying to sort of nerd out here other than just saying that like the layers are gonna slowly emerge where basically
LLMs and related reasoning technologies has become the kind of baseline technology that everything's based built
Alex: yeah.
But I, I, I agree and I think we we're gonna see a lot of rapid growth.
All, all, all I'm saying is like.
The, the, these types of technology can, I don't know, but can and often show the fact that like, you make
a ton of progress in the beginning, you know, as humans we got faster and
we started riding horses and we made faster cars and then we built rockets.
And if you, if you, if you looked at that trajectory, we would
say, well, in a hundred years we'll be going faster than light.
That doesn't happen.
Troy: Well, I think the lighting, the, the, the approaching light, which is sort of insight abstraction, reasoning,
asking right questions, not being prompted, those kinds of human-like
connections that are born of us being, you know, long standing sensory creatures.
Right?
Like that is not coming immediately.
I totally agree with you.
I think it's a great example.
I think it's a, or analogy rather.
So I had two items, Brian, and one was a, a, a sort of just slight reflection on the newsletter and the other one was trying,
I, Alex sort of shows up in my dreams sometimes and it, it was really trying to envision, I think it's really interesting.
Let's start here.
It's really interesting right now to try to envision what the new normal is or the new model or the new system that replaces.
What we know as of, of the system of the open web.
Okay.
Which is, you know, Google is center, you know, referrals via links, web pages, affiliate revenue banners,
YouTube, you know, the pressure of social media, challenging kind of, you know, old, old legacy media conventions.
All of those things are what we understand to be the web happening for a long time.
Right?
And now we've got this new thing and where knowledge is abstracted in real time from, you know, all of human
knowledge where everything starting with, you know, evergreen content
and service content can be sort of infinitely personalized for you.
And it's super cool and everybody I talk to from like.
You know, the people in my circle, my wife, my wife's friends, stuff like are shifting quicker than
I would've thought to using, you know, chat GPT as as an effective or related tools as effective tools.
And so like what it's, it's interesting for me to think about what that new model looks like and how it sustains itself.
And I think we get really caught up in the fact that, well, we'll have the snake eating its tail problem where, you
know, there will be no content 'cause there's no banners to run on webpages
and people can't, aren't incented to make content and get traffic from Google.
And, and I actually don't think, I think that there is a new ecosystem
and it won't, and, and we will find ways obviously to, to make it pay.
and, and that, that like slowly, kind of like Alex's analogy.
First we're gonna see the quick, you know, slurping of the most fundamental tier of knowledge.
And then we're gonna move into news and more real time stuff.
And there'll be new pressures on, you know, whose content is that?
How am I getting paid in all of that.
And other stuff will become more conversational, as you've pointed out, Brian.
So we're gonna see more media move to, you know, audio, video.
And yeah, there'll still be newsletters and there'll still be the odd
website and people will still like to read humans and all of that.
But the shape of the web, I, I'm really interested in, in how we start to think about the new shape.
Does that make sense?
Like what it actually, what is the new normal that we all sort of see as this ecosystem that's replaced the open web?
And while we can, you know, and it's top of mind right now because.
Like open AI is going out, the government's doing this, this,
this, this process led by, what's his dingle from all in
David
Sachs.
Brian: Jason isn't in
Troy: they're asking for comments around the new AI
Alex: Yeah.
Jason's the dingle
Troy: Right?
Okay.
So, so they're asking for comments.
What OpenAI is saying is you can't restrict us from sucking up knowledge
that should be considered, you know, open and available to us.
Right?
And what Meta is saying is you gotta encourage the growth of open of, of open source models.
And what Anthropic is saying is, oh, please make sure that we're safe.
Create a mechanism so government can review and shut down, you know, models
that become too powerful and everybody's sort of talking in their book, right?
and, and oh yeah, Google's saying, don't sue us if someone uses our model to make a bomb.
Like that's their line.
So all of these are things are coming from the big lobbying efforts of these big, you know, organizations.
And we're, we're, we're just in the middle of working through kind of what this new world's gonna look like and who gets what,
like who becomes the subsistence farmer and who's gonna have all the power much
like we, you know, have today, and what the rest of the ecosystem looks like.
And I think that, like, what I'd like to get to between us or in
my mind is a, a very simple way of describing this new world.
What it looks like, and it's, and it all starts with y your kind of like view, Alex, that started, I would say a year or
two ago, or a year and a half ago on the podcast, is like, everything's changing.
the spaceship's over the White House, and you know, media as you know, it is dead and it's all good.
It's all gonna be okay because I
Alex: I don't know if I, I don't know if I said that.
Troy: uh, Because I can
Brian: Is that where step two is a question mark?
It's all good as step three.
Troy: What does it look like?
Is that a, I mean, that's me
doing this.
I'm sorry.
I'm sorry I laid a lot out there, but what does that new world look like to you, Brian?
Brian: isn't that what this podcast is about?
Troy: Right.
Answer the que You just asked me a question.
Brian: Well, you don't wanna answer the question about what the podcast is about.
I don't know what that world is like.
I think we're just still, we're trying to figure it out.
And does anyone know what it,
it,
Alex: yeah,
I mean, no, I mean, I don't,
Troy: You can you feel me at least?
Alex: Yeah, I can feel you.
I mean, it's, feels like a trailer for this podcast, what you just said, because that's essentially all we talk about.
But
Brian: thought that was what it about.
I mean, other than the midlife crises, I thought that was what this is
Alex: Yeah.
Part of that.
no, I, I think, I think you're right, though.
the thing is like, it feels like in some ways that you can kind of look at the consumer proposition pretty clearly,
which is, you know, I'm gonna talk to my computer and my computer's gonna give me stuff, and that, that stuff is going to
either be regurgitated you know, in any format that I want audio, video, text, or, you know, it might be able to surface
a specific piece of content from YouTube, et cetera, that I can consume like that.
But, you know, e everybody, the, the most valuable space in, in technology,
what everybody realized is, is that it's, it's, you want to be the interface, right?
Google started showing flights.
Google started showing weather Google, you know, like, because they don't technically
Troy: The Europeans don't want Google doing that
Alex: Right, but I mean, good for them.
Right?
I, I agree.
But like everybody wants to own the interface.
Apple wants you to stay on their Apple News product.
Every, nobody wants you to go to the web.
Nobody wants you to go to the web.
So that, that, the tension there now is that these systems require people on the web, you know, which is this kind of great
distribution mechanism to make things so that they can feed it to their consumers.
Right?
And if, and, and, and the trade used to be like, you know, we'll put ads on that and, and you'll get a sense on, on the click.
I don't think that any mechanism right now has been figured out to, to generate that transaction.
And in part because they've just stolen all that stuff.
Like, I mean, let's be fair, they, they, you know, they're, they're using fair use, but they've just gobbled it all up.
And, and that's fine for now, but a lot of these sites are gonna be running on fumes.
And when they shut down.
They're just gonna run out of data or they're gonna be ingesting data that that
Troy: Or, or they make you a subsistence farmer, which is really what will happen.
Alex: I mean, yes, but I think like the sub, you know, it, it feels a little bit like in the Mediterranean
at some point they were kind of scraping the ocean with those nets to just capture all the food there.
And, and they decimated escaping, escaping the sea bottom, and they decimated parts of that, that ocean floor.
And there's nothing there anymore.
I, I, I think that that's the risk
Troy: It's still a, still a great place to visit.
Brian: well, yeah, I was on Corsica and there's no fish like fresh fish from
Corsica.
Alex: The subsist I think the subsistence farming era was Google.
Right now.
Now it's the kind of like scorched earth era, because I don't see how anybody makes money.
I see all the value for the consumer a hundred percent.
I, I, I keep saying that this is the interface that people want.
But there is, there is very little brand building in that
Troy: Hey, I would just ask you, dude, when the robots are making
everything, which is gonna happen, and it's not gonna take that long, right?
When they're doing the assembly lines and they're fixing my you know, my sink and all that stuff we need something to do.
We make media.
That's all we got to do.
We make and we consume media.
Alex: it's true.
They'll just be, I mean, are you say so, so your hypothesis is, I think
I, we had talked about that before, but like, eventually, like people
will always, yeah, people will always create media, right?
People create media.
They won't be peeling carrots or cleaning toilets for fun.
But, but, but they will always
create media for fun.
And,
and, and with the right amount of
Troy: And the rest of them will be paid a little bit and then they'll be the craftspeople, the pucks, the people like
Alex: yeah, look at us.
Look at, look, look at the amount of value we generate for free.
Sorry, somebody's
at the door.
I,
I'm gonna have to, it's my heart Stop.
It's my
heart.
Stop.
Brian: Yeah.
I know this is, Alex has a hard stop.
Troy: Alex, I
love you.
Thank you
Alex: Love you too.
Bye.
Troy: Okay,
Brian: Um,
Troy: before we bring on a ab anonymous banker I also had a thought about emotion and how sometimes I feel
like our newsletter has like too much substance and not enough emotion.
Like we should just be kinda lighter or we should talk about things that make people feel things like productivity.
I. People like that productivity newsletter was shared and read by
more people than any of the other stuff that seemed smarter to me.
Brian: What, Troy, why do you think everyone who creates content on the internet becomes a life coach?
It's the inevitable arc. You can start wherever you want, but if you create internet, if you create
content on the internet long enough, you become a life coach.
That's my theory.
Why?
Like Scott Galloway is now like, he's like trying to save young men.
He was like a marketing professor at NYU.
Wasn't he like with, with, I mean, I, I admire it.
It's
Troy: Will you do me a favor?
Will you write a little bit about that notion in my question
Brian: this
Yeah, no, I mean if like this ad tech thing doesn't work out, I mean, I'm
happy to go into, if anyone wants any life advice, I'm open for business.
no, I think people do like that.
I agree.
Troy: I was inspired with that thought by listening to God Help me, a Semaphore podcast where they were interviewing
this guy Frank Cooper, who's now the CMO of Visa, who used to work at Def Jam
Brian: Yeah.
He wasn't he at Pepsi.
Troy: yeah, he was at Pepsi.
And, and he, his point was like, what makes good hip hop?
And his answer was, it's like, it's not about the best guys or the best rappers or the best lines.
It's like, finding something that's within people, making them feel something
Brian: All right.
AB is here.
AB: Hey, how's it going?
Brian: Good.
Can we go back to talk about the, the skim?
Troy: No.
the, the ab thesis for this week was that, you know, there's the cleanup acts in media that are going on right now.
I
Brian: Yeah, that's, that's the skim.
That
is the skim thing.
The
AB: And
taste Taste made.
to, you know, that's another, yeah.
Brian: So these are just like.
Capitulation deals.
I mean, this is like going to the, the scrapyard.
AB: I think people make a decision that, you know, the growth ahead is, there's a big question mark, and so
there's a point in time now where you can potentially get out, there's a ton of these names, media names, that people
would recognize that are either for sale by bankers or informally you can acquire.
So.
Troy: you do They say for sale by owner in the, in the capital markets.
AB: I think it's just discu.
I mean, people just know where, where the for sale signs are.
I mean, one interesting thing someone asked me earlier this week is like, where's the wiz in media?
I, I don't think it can ever exist.
Brian: What you mean?
Nobody beats the wiz.
Troy: No, no, no.
The, the, the cyber, the, the cybersecurity company that sold
for $32
Brian: I, I see my, see, no, I, my, my mind was
in a totally different place.
I'm like,
AB: You're watching YouTube Too much.
Yeah.
Brian: Well, no discounts, discounting.
I mean, nobody beats The Wiz.
The Wiz.
This whole thing was that like, you know, he's got, he gets, you know, he is the lowest prices.
So I was just
Troy: four.
Israeli dudes just sold their company for $32 billion to Google.
AB: Yeah.
And under five years, right?
They created in, in 2020.
And it, it's, it's funny because in the press release, it's, it's an all cash, there's no earnout and it says subject
to adjustments, but the adjustments are pretty dim, minimis, probably.
So
Troy: Like for coffee and like other sundry
AB: working capital.
Yeah.
But I, yeah.
I, it is an, it's a, it's an interesting thought exercise of where some value can be created at that speed and scale.
I think a more easy thing to replicate is like the poppy example, Right.
I don't know if.
If you guys have, it's really interesting to watch their Shark Tank episode.
'cause it was a completely different idea back then.
And then they turned it, you know, they got a 25% investor.
One of the guests on Shark Tank invested in it.
He changed the branding.
He basically figured out that they had a great product.
They just needed to fix the branding and their go-to market strategy and created something that
Troy: But, but you, you can just look for those characteristics in different markets ab and those are the ability
to leverage business against a bigger distribution system and particularly something that's high margin, right?
So in the case of this the wiz.
Basically the hope would be that their product supercharges, Google's cloud
offering, which is very high margin and very important competitively.
In the case of Poppy, they go to Pepsi.
Pepsi has distributions in every distribution into every corner store on the planet, and they could, you
know, take you into, you know, any facility basically that they're in.
Right?
So the leverage on that brand is great.
It's the same thing when you see the eye rolling multiples at a revenue level with like someone who sells a tequila company
to one of the big, the two or three big, you know, hard liquor companies where they get the distribution advantage.
It happens in packaged goods too.
So,
AB: Well, they actually pick up a a ton.
'cause right now Poppy is distributed through the Anheuser-Busch network.
So you automatically actually pick up 20 to 30% of margin just by changing to the Pepsi distribution network.
Troy: Mm-hmm.
Brian: So what does that look like in media?
Troy: Well, the only place it looks like that in media, I think is where you have super valuable IP that's not
whose monetization's not being realized because of either some, you know,
subscription ad selling or distribution mechanism that's underutilized.
So if you owned before it was a big thing like Pixar going to Disney, right?
Like Disney could make a lot out of that asset.
So that would be the example that I would give.
Or on the small side I don't know who's got great IP that sells it, you know, in a limited way.
Bars still selling to Penn.
AB: Yeah, you see some of this, it's, it's an interesting way to gauge ip, but I bumped into a company last week
that is gonna do, it's like an agency with college creators and they're, they did a couple million of revenue
last year and they're on track to do 50 million of revenue this year.
Basically because there's so much brand dollars flowing into the creator space and there's not amazing places suspend it.
So this operating team.
Has basically become a beacon of a lot of brand money.
And it's profitable, it's growing the other place.
I see.
'cause I think there's like a, a, a deal news that the Boston Celtics just sold for what six or 7 billion is
in this need around sports rights to continue to monetize the media side.
Because as the linear deals go down in value, they're gonna have to figure out ways to monetize the YouTube and
other digital rights, because that's the only thing underpinning a lot of the.
Value of the sports teams.
So I, I think there will be continued new company creation and values growing in companies around sports
teams and athletes and creators to better monetize that content.
Brian: Yeah, I did you see like Unilever wants to spend like 50%
of like their marketing on like creators, something like that.
And I just wonder where is that gonna go?
AB: I think what there's the, the consum, what it is like the consumers, I think we wrote about this, like
30 to 50% of their time is on, are on these different social platforms.
So it's more about chasing the eyeballs, but it's tough, right?
It's like it's gonna go either to the platforms directly or some of these different.
You know, there's a, a business that's about to be sold that layers on top of
YouTube that helps to better organize the inventory for brands to spend.
It's, it's a big business.
It's 30 million of ebitda illustrated a really good multiple, and it's just like a layer layered on top of the YouTube
advertising ecosystem, and it helps brands better target their consumers.
Troy: And on the ad side, I wonder if we don't see those multiples in, what's the
name of that ad network that's trading at bonkers multiples the mobile game app.
Love.
And I wonder if that one isn't driven, partly because it would be very useful to someone like Apple,
Brian: It's like an alternative to Apple, isn't it?
Troy: right?
But someone sees an opportunity.
I mean, it's, it's, it's beyond multiple comprehension, isn't it,
AB: I mean, it's trading.
yeah.
And then, I mean, the whole thing is like they've cornered the market in terms of driving app installs, and there's a
couple ecosystems that they play into for example, like casual gaming, it, it.
It exists because it's basically farming a user for three to six months in terms of showing 'em ads,
and then as soon as they get tired of that game, moving into the next.
So you need these ad networks that can do app installs and other things to drive consumers to the next app.
Brian: It's basically most of mobile gaming is arbitrage.
Yeah.
It's great.
Arbitrage is everything.
AB: It's like plugging people into this matrix of just go, taking their attention for an hour or two a day, getting them
highly addicted to a game for three to six months, and then moving them to the next.
Troy: You know what's amazing ab is that the contrast between market reception to something like app loving, which is,
you know, an ad network that focuses on a certain, you know, inventory type and, and, and consumer behavior
to Tabula that focuses on a different inventory type that has incredibly broad distribution penetration, but
can't seem to get out of the, like doldrums from a valuation perspective.
AB: Yeah, I mean, I think the ad product, I mean, tabula continues to try to innovate its different ad products and
they mentioned they're getting into performance with Microsoft and MSN.
I think that the app love and ad product actually works at a pretty high.
Like fidelity, and they're getting paid significantly for those
app installs, whereas everyone's encountered the tabula ads.
You land on pages that you're like, what is this?
Right?
It's like very weird.
Troy: Before and after.
It's before and after, man.
AB: It's, tricking a, it is tricking a subset of consumers
to buy stuff, but the majority of people literally exit out in two.
They're like, where, how did I accidentally land on this page?
Troy: toning skin, toning, dental
Brian: Yeah, just to put like numbers.
So App Loving stock is up 333% in the last year and Tablos is down 31%.
Hey, do you know what, what is going on with the Trade Desk?
It's funny 'cause they were the, the sort of standout of the Ad Tech publicly traded stocks and, and now
they're going through this this period where everyone's down on Trade Desk.
Do you follow that at all?
AB.
AB: I mean, I just Googled it so they didn't meet the revenue expectations,
Troy: For
one outta the last 20 quarters.
Yeah.
AB: yeah.
Brian: they're down 52% year to date.
AB: Yeah, I don't, I don't follow close enough to have a good perspective.
Troy: my take.
They're, the market is seeing that they're too reliant on, they have a lot of revenue in the page-based ecosystem.
They
didn't defy gravity, And that they're not penetrating you know, video is, or, or what do you call it?
CTV as well as people maybe hoped.
Brian: Yeah,
AB: If you look at like the, the Critio stock, you know, so much of, of when it was, it's, it's back to a, a relatively
good price, but so much of what was priced into it is their expectations of retail media and the growth.
And so a lot of these.
Stocks.
The reason why they're they trade up or down is because they come up with a thesis.
They say, we're gonna be able to grow to this much revenue in three years
because we believe the ad market is going to shift in this direction.
We know that agents, there's a lot of blockers for change in the ad world.
And so when that doesn't come to fruition as fast as people think, that's
what happened to Criteo is like they basically this was two Decembers ago.
They turned off their, they said, we're not gonna be able to hit our projections.
You know, this isn't coming to fruition as quickly as we thought.
And then the stock dropped 50% overnight and it was literally the last question on an earnings call.
Someone pushed in and, and figure this out.
And so I think that's what a lot of these companies are based on is.
Market forces, they, they don't, they're not completely in control of themselves.
They're hoping the buyers shift in a certain direction.
They can command more of the ad dollars and then take a higher margin.
Brian: Should we
Troy: other questions
I can give you a little, a little good product taste
if you want.
I'll get back to, to, you know, grocery items soon.
And then maybe electronic products.
Like, nobody wants to know that Dyson is a, you know, good cordless vacuum.
Right.
Uh, you know, clearly comedy's having a moment, and now comedy and politics are seemingly inseparable.
But there's a show I tuned on Lasette.
I'm not gonna put it up as good product, but it's maybe at a little bit of a lead in.
And it's called, last one, laughing.
Do you know the show?
It's being franchised into every, there's one in Germany, one in Canada,
and basically they put 10, 10 comedians in a room, and if you laugh, you lose.
And so then they set up a bunch of pranks to that.
They can all do, like, they put one of them on stage and he or she tries to get the room to laugh or they have, I don't
know, like just different kind of gags that, that are like, there's one thing where you put the person on a stool and
then all the other comedians get to come up and whisper something in their ear and to see if they can make them laugh.
And it's like not great.
Six hours of entertainment.
But it's a really interesting new format and it's on Amazon Prime, the UK one.
'cause the British are the funniest people.
I mean, if you loaded it up with really funny people in America, you might be able to make it work in the, you know,
people in the UK are, I mean, generally speaking, the British are funny.
I don't know about the German one.
That may be just ironically funny.
But anyway, last one.
Laughing.
Not quite a good product, but interesting experiment.
There's a good new Mo Black bag is a good movie, by the way.
It's a se Soderberg movie starring Kate Blanche and Fastbender Marissa Ella from Industry Tom Burke.
And it's perfect.
90 Minutes of Entertainment.
It's like.
A stylish spy thriller.
Everybody needs those.
And so I, I re But that's a good product for sure.
And the last one I would say is your friend Alex Kitz interviews Juan Koon on YouTube, where they talk about this
sort of existential question that we were talking about with Alex, which is when will AI make its own discoveries?
When will it show insight?
When will it ask?
Not answer questions, but maybe ask them, and
Brian: Koon is like a, he's a dor, isn't he?
Troy: I don't know.
I don't, I don't, no, I don't, I don't think so.
I think he's more of a kind of realist.
he's great.
We'll put the link in the notes.
I think Alex is a really informed, good interviewer.
I, I like watching
his stuff.
Brian: Good.
I like Alex.
All right.
You have a good product ab.
AB: Well, I have two, two comments.
One interesting thing in this world of content creation, comedians seem to be brought up more and more around like,
there's a business called Donut Media that sold to recurrent a few years ago, all in the auto space, and they
were basically able to arb the, the va, the cost of content creators by going
to these like second tier comedians and getting them to do YouTube shows.
So.
It's, it's an interesting thesis that people are using to basically find cheap content creators that are good,
that can do shows, be funny on the fly and they're not worried about them necessarily taking over a YouTube
channel or a brand where they become like the, the focus of attention.
So, I, I feel like being a, there's never been a better time to be a second tier comedian.
Troy: in other words, there's good multiples on second tier comedians right now.
Brian: you can ar,
you can arb.
Second tier comedians
AB: Most of them, you know, can't make, they're just happy to pay their rent and get health insurance.
And their desire is to be a comedian, not to be, not to be a media.
The other thing is
I ask people,
Brian: things don't change.
This is how media got built.
I mean, right.
AB: Yeah.
The other thing is it feels like I. So I ask people all the time, like, are you using ai?
And it feel, it, it finally feels like it's turning more into a tool versus a toy.
And even across age ranges, everyone seems to be using it now.
Like every call, even people that are older that I would never
think would use AI are like, oh yeah, I'm using it every day now.
So I think that's, this happened in the last few weeks and I've just
been surprised the the broad group of people that say they're using it.
On a daily basis, and actually big investors, other bankers people in corporate development.
Troy: Yeah, it's it.
It's the moment like when grandpa got on
AB: a hundred percent.
Brian: How is it used in like in your field, like how do you use it?
AB: I mean, so the, the simple example is you're going to a meeting with someone you didn't have time to prep.
You put in their name, you put in their company, and you tell deep research to tell you the things that have happened
in the last year, like what you should talk about, like simple things like that.
Say if we're taking a company to market in space.
Troy: That model you sent me the other day, did it do that?
AB: No, no.
There's a, there's a couple companies that we're testing out right now that are supposed to do this stuff, but I think
what's interesting is the, the underlying foundational models are actually getting better than the wrappers, right?
So there's a company called Rogo that's at a bunch of the banks helping people do presentations, but.
Chat.
BT has actually gotten better than that, so than that, that?
program at, at doing the, the work.
So it, there's nothing good in Excel modeling right now for buyer lists.
I mean, it's all the basics of, of a first or or second year analyst.
The models can do now.
And I think, I think where the junior level staff is gonna move as
more of a manager of these AI tools to just produce a lot more work.
Troy: will it buy me lunch this afternoon?
Will it send me a bottle of good tequila?
AB: Exactly.
Yeah.
I mean, that's, that's the pa, that's the future, and that's what I push A couple of these folks on is like the kinetic,
basically, where it's sitting on top of your CRM and saying, Hey, you should reach out to this person, da da, da.
Like that hasn't happened
Troy: That's it for this episode of people versus algorithms where each
week we uncover patterns shaping media culture and technology.
Big thanks as always to our producer, Vanja Arsenov.
She always makes us a little clearer and more understandable and we appreciate her very, very much.
If you're enjoying these conversations, we'd love for you to leave us a review.
It helps us get the word out and keeps our community growing.
Remember, you can find People vs.
Algorithms on Apple Podcasts, on Spotify, and now on YouTube.
Thanks for listening and we'll see you again next week.
Brian: All right.
This is a little bit of an uneven episode.
Troy: Alright.
Brian: be honest with you.
I gotta do my next