0:00

It's the holidays, which means you might be on the

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your life. Heat and

0:44

cook. That's

0:46

me. And this is the

0:48

last episode of Recode Media. It's

0:51

the last one. That's it. Now, like I said

0:53

last week, the show isn't really ending. It's

0:55

going to head to a new home with a new name

0:57

early next year. And if you want to

0:59

hear it, then all you got to do is nothing. Just

1:02

make sure you're subscribed to this feed on Apple

1:04

Spotify, wherever you get your podcast, and

1:06

we will come to you. But

1:08

like I also said last week, I've been making this show

1:10

at Vox Media since February That's

1:13

almost eight full years. That's hundreds of episodes,

1:15

hundreds of guests. And it

1:17

also means I've worked with lots of awesome people over

1:19

the years. I wish I could thank every one of

1:21

them by name. I can't do that,

1:23

but I do want to shout out the people who are

1:25

making the show with me right now. That's

1:28

Jolie Myers, Travis Larchuk, and Jelani Carter, who

1:30

has been putting up with me for the

1:32

longest time. Thank you, Jelani. If

1:34

you're lucky, you get to work with great people. And

1:36

I have been lucky for a long time. And

1:39

while I'm thanking people, I want to thank you, the people

1:41

who listen to this podcast and tell other people to listen

1:43

to this podcast. And you tell me when I'm

1:45

doing well. You also tell me when I can

1:47

do better. Like I always say, I

1:49

love making this show and I love hearing from

1:51

you. Let's keep it going next

1:53

year. And now, what's probably going

1:56

to be the last chat I ever record out

1:58

of the Vox Media Studios. Here's

2:00

me talking to Lucas Shaw from Bloomberg. He's going to

2:02

help us make sense of the year we're wrapping up.

2:05

Give us some ideas about where things are going

2:07

next. Lucas

2:09

Shaw, you're in Seoul. I'm in New York.

2:12

It's afternoon my time, so it's, I don't know

2:14

what, Friday morning for you. It

2:16

seems like it's early for you. It

2:18

is 7 a.m. and I guess because of

2:21

how far north we are, it is

2:23

still dark outside. God bless you.

2:25

Thank you for coming on Recode Media,

2:27

the last Recode Media of all time.

2:31

We can get nostalgic later, but this will be a nostalgic

2:33

episode. I want

2:35

to talk to you about the year in media,

2:37

which is not yet done, but it's done for

2:40

me. A lot happened. We've had

2:42

you on a couple times to talk about it, and

2:44

I kind of want to talk about what we've learned from the

2:46

year. So let's just start off

2:49

with the big thing, the strike. We spent five

2:51

months, we spent more than five months talking about

2:53

the strike because we spent a lot of time

2:55

in advance talking about the strike. The strike's still

2:57

technically not over. I think it

2:59

might be by the time this podcast comes out, but

3:02

it looks like the SAGS, the actor strike will be over. What

3:05

have we learned from the strike? And

3:08

we is a big collective question, right? Is

3:10

it, it can be us as consumers,

3:13

us as an industry, could be the

3:15

studios, could be the talent. Is there

3:17

one central takeaway for you? I

3:21

don't know that this counts as

3:23

a learning, but as much as

3:27

before, during, and after, it just

3:29

felt like we've

3:32

all as a society

3:34

experienced streaming changed the

3:36

way pop culture works, or

3:39

even more broadly, internet changed

3:41

the way entertainment works.

3:45

And it was similarly, and perhaps even

3:47

more disruptive for the way the business

3:49

worked. And much

3:51

as for us, at

3:54

first, everyone thought it was great, and then

3:56

more time went by, we realized there were

3:58

maybe some flaws in streaming, some of us

4:00

came sort of miss the ease

4:02

of cable, if not the way it

4:05

was structured. A lot of the creative

4:07

people who thought streaming at first was

4:09

this salvation from the strictures

4:12

of broadcast TV, got

4:14

to realize that there were some flaws in the system and

4:17

the companies didn't wanna change it. And so they had to

4:19

go on strike to change it for them. And

4:24

time will tell if it was as dramatic and

4:27

revolutionary as

4:29

some of the members of the Guild

4:33

say it is. But

4:35

it's all part of this sort of

4:37

broader reset that's been happening in Hollywood

4:42

and honestly in tech and media beyond

4:44

where the layoffs

4:46

and the restructuring just never seemed to

4:48

stop. Yes, he said

4:50

pointedly. Are

4:53

there significant changes in the deals themselves?

4:55

If we compared this to the last

4:58

working deal, there's language now about AI

5:00

that obviously didn't exist in the last

5:02

deal. There's some discussion about how streaming

5:05

revenues will be allocated. It

5:08

seems to me like these are pretty small tweaks around

5:11

the edges. I mean, look, they got really

5:14

substantial raises. We're

5:16

not talking about the auto workers, 25%

5:19

or whatever that number ended up

5:21

being, but very substantial raises. That's

5:25

what you expect out of a contract, right?

5:27

I'd like to get paid more. You don't

5:29

want to pay as much. We'll settle somewhere

5:31

in the middle. They have adjusted the way

5:33

that residuals get paid for streaming and that's

5:36

essentially kind of getting paid for reruns and

5:38

it used to be that you got paid

5:40

for reruns because networks would literally re-air something.

5:42

Streaming's obviously a little bit different because something

5:44

is always available for viewing and

5:47

so there's the residuals formula. They got

5:49

paid more for streaming residuals

5:51

outside of the US. I

5:53

mean, those all amount to we got paid more, but

5:55

they all matter and they all

5:57

had to fight for them. And then they got a couple.

5:59

a few new things that I'm talking more

6:01

about the writers than the actors here, but

6:04

that the writers were very important.

6:06

They got minimum staffing, meaning a minimum

6:09

number of people had to be employed

6:11

on a show. They got both

6:14

the writers and actors are getting bonuses

6:16

for streaming shows that are particularly

6:19

successful. And as you know, they got

6:21

some protections against AI. It's

6:23

really hard for us to know how significant they are. Right.

6:26

So they modernize their contracts a little bit to reflect a new

6:28

reality. One in which there

6:30

really isn't syndication and which were the handful

6:33

of streamers sort of

6:36

are going to be the way that most people see a lot

6:38

of shows, etc. There

6:40

was a New York Times profile of David Zaslov,

6:42

the head of Warner Brothers Discovery, last

6:44

month. It's very good. If you

6:46

listen to this show, you've probably heard a lot of this stuff

6:49

before, but it was really well done, I thought, and there was

6:51

great anecdotes. And near the end,

6:53

there's kind of, I thought, an incendiary, I don't think

6:55

it was supposed to be an incendiary quote from David

6:57

Zaslov talking about the strikes and the strikers.

6:59

He said, they were right about

7:01

almost everything. And

7:03

the way I read that and a lot of other folks did

7:05

said, well, if we were right about everything, why did we spend

7:07

five months out of work at

7:10

a real cost to both us and

7:12

the companies? How much of the strike

7:14

is the studio's fault for

7:16

not coming to their senses earlier?

7:19

Hard to say. I mean, I think some

7:21

of it certainly, but I do.

7:26

Well, one, I would love to get David

7:28

Zaslov to explain that quote because he's someone

7:30

who just sort of says things sometimes. He

7:32

talks a lot. So I don't fully

7:34

know what he meant by it. But I

7:37

also do think that looking back on it, and we

7:39

may have talked about this, the studios really did think

7:41

that it wasn't, had hoped to

7:43

get both the directors and actors on board. And so

7:46

then they could have sort of forced the writers a

7:48

little bit more. So

7:50

they didn't really engage with the

7:52

writers in a big way until

7:54

July, which is when the actors

7:56

went on strike. Now

7:58

after that, could they have done a deal? deal

8:00

quickly, maybe, yeah. It

8:03

ended up taking them a little more than, or about two

8:05

months, or three months to have it

8:07

really, I should say three months to have it really

8:09

all written, all

8:12

said and done. I

8:15

think everyone involved thinks that it could have been

8:17

faster and just points fingers at the other side.

8:19

Yeah, sure. The line from the studio for most

8:21

of it was, hey, the writers and

8:23

the actors have to understand we're in a new

8:25

reality. Bob

8:28

Iger had a quote along those lines, the

8:30

stuff you guys are asking for isn't realistic.

8:32

We simply can't afford what you're asking for.

8:34

This is, again, what you expect to hear

8:36

in a negotiation. Is there any

8:38

truth of that though, that the concessions the

8:40

studio's made are gonna show up in

8:43

some way on screen, that there'll be less product, the

8:45

product will be more expensive, and so they won't be

8:47

able to make as much stuff, that

8:49

somehow a viewer will see

8:51

the impact of this deal? Maybe

8:55

in output, but I think that

8:58

that's what was gonna happen anyways,

9:00

these companies were cutting back. I

9:02

mean, look, the studios had actually

9:04

a very good excuse or argument,

9:06

depending on your perspective, that

9:10

their stocks were getting crushed. They were being

9:12

told by Wall Street to spend, still are

9:14

being told by Wall Street to spend less

9:16

money, generate more profit, fix the streaming business.

9:19

And increasing costs by paying

9:21

writers more, and

9:24

then paying actors more, was gonna make it

9:26

more challenging for them. It was also gonna

9:28

set precedent for them to pay other guilds

9:31

even more money. And there were certain things

9:33

that the guilds asked for, like the actors

9:35

asking for a percentage share of all streaming

9:37

revenue, that I think the studios are right

9:39

to balk at. But on the

9:41

whole, they could afford it, right? Like they could

9:43

find ways to spend less money and other things,

9:45

and even though the studios hated this, you know,

9:48

or David Dazlez, as an example, let's look at

9:50

how much money he gets paid for 2023. And

9:54

could he have given up half

9:56

of that money to help fund these deals?

9:58

And you can go across. How much

10:00

money is Bob Iger at Disney going to get paid?

10:02

How much money is Ted Saranis at Netflix going to

10:04

get paid? And so on and so on. I

10:07

don't know how much it's going to

10:10

impact the output or what

10:12

you see. I mean, these companies

10:14

aren't going to go from, they're

10:16

not going to be spending dramatically less to

10:18

make these shows. Shows are only getting more

10:20

expensive, same with movies. And they're

10:22

still going to need a lot of it. They're

10:25

just going to be a little more judicious about

10:27

what they choose to make. And they're sort of

10:29

already doing it. How do the studios figure out

10:31

how to make streaming work? Netflix seems to have

10:33

finally done it after years and years and years.

10:36

And they had a very well-publicized wobble. We

10:38

talked about it several times. It

10:40

seems they are now stronger than ever. I

10:42

don't think you can say that about anybody else who

10:44

was trying to chase them for several years and has

10:47

now sort of put the brakes on. And

10:49

they all are cutting costs. And in a way, they

10:51

want to make streaming profitable. What will

10:53

it take for everyone who's not Netflix to make

10:55

streaming work? Some

10:57

combination of spending

11:00

smarter, charging

11:02

more, and maybe

11:05

merging. Disney seems

11:07

to be leaning into the spending smarter

11:09

and charging more. They're in the best

11:11

position still of any of these other

11:13

players, just in terms of the

11:16

number of subscribers, as

11:19

well as sort of

11:21

their hand, I would say. Disney Plus

11:23

was very, very cheap. I don't

11:25

know how you... They

11:28

made a bunch of weird shows. I still think that

11:31

Disney Plus probably doesn't have enough on

11:33

its own. But because they are sort

11:35

of imminently combining Disney Plus and Hulu, they

11:37

can probably come up with a decent

11:39

budget and a decent programming slate that

11:41

will keep people hooked and is slightly

11:43

more economical. It's everyone

11:45

else that's in a

11:47

little trickier spot. I mean, look, Apple

11:50

and Amazon, obviously, as larger corporations, can

11:52

stomach what they're spending. And

11:55

Apple in particular doesn't

11:57

spend that much because they don't... have

12:00

a library. But

12:02

the Warner Brothers Discoveries and Paramounts

12:05

and Peacocks of the world all

12:09

still have a lot of figuring out

12:11

to do. And this consolidation, consolidation,

12:13

consolidation talk, we've had it for

12:15

years. You had John Malone

12:17

a month ago saying,

12:19

everyone should consolidate as soon as possible.

12:21

He's the main shareholder behind Warner Brothers

12:23

Discovery. He's got a vested interest. Those

12:26

deals have yet to manifest. And every time I have

12:28

you on or someone else who covers media, we ask

12:30

what one that's going to happen. We

12:33

pointed to 2024 as a year that could

12:35

happen. Any more reason

12:37

to believe that someone's going to buy

12:39

someone meaningful this coming year? I

12:42

mean, only in

12:44

that you bring up John Malone and

12:47

Warner Brothers Discovery and their limitation on

12:49

doing another deal sort of expires because

12:51

of this kind of tax stuff

12:54

that we don't need to get into. I want

12:56

to say reverse Morris Trust in the last podcast.

12:59

I said it. And

13:02

just some of these companies, the situation gets more and

13:04

more perilous. I mean, you look at a Paramount and

13:08

they're worth, I haven't checked, their stocks popped

13:10

a little bit recently, but it's still worth

13:12

like $9 or $10 billion. And this is

13:14

a company that when CBS

13:16

and Viacom combined, they were both

13:19

worth more than $10 billion independently.

13:21

So at a certain point, you

13:23

know, Sherry Redstone, whose family

13:25

controls that company, it's

13:28

going to have to capitulate. Yeah.

13:30

You know, but otherwise, no, we could be sitting

13:32

around and waiting. They may just get tired. We

13:35

get in the same discussion in a year. Absolutely.

13:37

Why haven't they combined? And

13:39

then the other version of combination that we hear a lot about

13:42

is, oh, we've got to re bundle. The bundle

13:44

needs to come back. Sometimes you hear

13:46

consumers say, boy, I wish I could have

13:48

all the stuff for $100 just like I

13:50

used to, which I think is delusional and

13:52

they don't also remember how bad the cable

13:54

bundle used to be. But

13:56

I also think that people say, oh, if we

13:58

bundled together, I understand that bundling multiple

14:01

services reduces churn. So that's good

14:03

in theory for the studios. And

14:06

you'll see like so Verizon is now

14:08

doing something where you can get Macs

14:10

and Netflix together. Is that

14:13

the bundle people are imagining? Are they imagining

14:16

one mega bundle owned by one company?

14:18

That doesn't sound very good at all

14:20

or plausible. I am and I

14:23

detect from the way you framed it similar

14:25

to you sort of skeptical of

14:28

this return of the bundle concept.

14:31

It does reduce cancellations

14:33

if done right. But nobody

14:35

seems to be rushing to package

14:37

all of their services together. And

14:40

there is no bundle that functions

14:43

without Netflix as the centerpiece.

14:45

It's the biggest and most popular service.

14:48

And Netflix, that

14:51

bundle you referenced is for its ad

14:53

tier. It's really trying to grow its

14:55

ad tier as a funnel for the

14:57

main thing. And so maybe it pursues

14:59

more deals there. But I don't get the

15:01

sense that Netflix, at least not in the US,

15:03

feels like it needs a

15:05

big bundle to reduce its churn, which

15:08

for now remains way, way, way better

15:10

than everyone else's. And none

15:12

of these other competitors other than Disney

15:14

and Amazon and Apple have

15:17

big businesses outside the US, which is

15:19

where there are certain. And I don't

15:21

think like bundling Disney with Amazon in

15:23

the Philippines is going to make a

15:25

huge difference. So I guess I don't

15:27

think there's going to be some huge

15:29

rebundling. I do think that you'll see

15:31

experiments to try to essentially

15:34

just bring in more customers or reduce churn

15:36

for some of these services. And we've honestly

15:39

seen versions of this forever.

15:41

There used to be a Showtime Hulu package

15:43

you could get. This is Disney has its

15:45

own bundle, which it's now sort of slowly

15:47

turning into just one Disney service. But it's

15:50

having to do so very carefully. So it

15:52

doesn't end up trying to charge everyone $25.

15:56

And what about the consumer complaint that, oh, I

15:58

can't figure out what stuff streaming where and what

16:00

I own and what's, I mean, there's a

16:02

real pain point there. It would be nice

16:04

to go to one screen that showed you

16:06

everything, and you could first of all at least figure

16:08

out if you have it or not. Even

16:11

now, like you could, services like JustWatch don't really suffice. You

16:13

do have to sort of hunt and pack.

16:15

I'm fine with that, but I understand that's a real

16:18

concern for folks. Is there any relief coming for that?

16:21

Not until these companies

16:23

decide that they want to give

16:25

some big third party the power

16:28

to make a TV guide,

16:30

right? Apple tried

16:32

to do this in TV. And Netflix said

16:35

no, thank you. Google and Amazon have sort

16:37

of tried to do versions of this. And

16:40

yeah, the big streaming companies just say, we

16:42

don't want to give over our data. We

16:44

don't want to give you control of the

16:47

customer experience. And this is another

16:49

area where basically until Netflix is willing to

16:51

play ball, it's very

16:53

hard to do. What about the rest of

16:55

TV? Bob Iker this summer in

16:58

that same interview where he said the actors

17:00

and writers have to become realistic,

17:03

said essentially, all

17:05

my TV networks are for sale, or most of

17:07

my TV networks are for sale. And

17:10

at the Dealbook conference last week before

17:13

Elon Musk came on stage, he said, that was fake

17:15

news. I didn't say that. It was kind of what

17:17

he said. Then he said, well, actually what I was

17:19

doing is putting up a trial balloon. I wanted to

17:22

see what Wall Street thought of that. But it turns

17:24

out we're going to hang on to all that stuff.

17:27

One, why do you think he

17:29

decided to not sell the stuff

17:31

because there isn't a price that he can get for

17:34

it that is worthwhile? And two, how

17:36

does Bob Iker get away with saying something out loud on

17:38

live TV and then saying no, I kind of didn't say

17:40

that. I'll take the second one

17:42

first because I've been it drove me insane. I

17:44

wasn't in the room because I've been abroad. So

17:46

I didn't see how Andrew Ross or can handle

17:48

that. You're a sort of the total pro. So

17:50

I'm sure he did fine.

17:53

But it did strike me as

17:55

like, OK, you're just blaming the

17:57

media for something that you said.

20:00

Really relies on ABC now the big

20:02

leagues like to have live sporting events

20:04

on broadcast TV because broadcast TV Can

20:07

still deliver a bigger audience than cable

20:09

and so you packaging ABC and ESPN

20:12

is powerful and makes it easier for

20:14

them to keep Top NBA rights

20:16

or top college football rights and top NFL

20:18

rights And if you're just

20:20

gonna sell ABC then it really hurts ESPN.

20:23

He's made clear He wants he sees sports

20:25

as foundational for the business a differentiator Which

20:27

I think it's a smart move because it's

20:29

one thing that they have that Netflix for

20:31

example doesn't have yep And

20:34

no one has ESPN. Yeah Otherwise

20:36

you're talking about what you're gonna sell like freeform

20:38

and FX and how much difference is that really

20:40

gonna make? I don't know how much you'd really

20:42

get for them at this point I was

20:45

gonna ask about movies, but I want to segue to

20:47

sports because we do have some big sports packages Hitting

20:50

the market in their server already on the

20:52

market. The big one is the NBA We've

20:54

talked about this before the NBA essentially wants

20:56

to double what they're getting from American broadcasters

20:58

to bit to get about seven eight billion

21:00

dollars a year is the price they're asking

21:03

for and Every

21:05

year we have the same story, which is hey

21:07

people are watching less TV Maybe they're even watching

21:09

less sports But the rights for these keeps getting

21:11

more and more expensive and there's

21:14

been this debate about whether or not the conventional

21:16

networks can continue To pay that maybe the

21:18

tech guys will come in. Maybe someone will

21:20

boost that up I thought

21:22

it was very interesting though. There was a

21:24

deal announced yesterday for English Premier League It's

21:26

the the big it's the most it's the

21:29

most popular soccer in World

21:32

in the UK and it's it's supposedly the rates

21:34

went up 4% But if you look

21:36

at it, it's kind of flat and there's even a note

21:38

out saying actually it looks like their rates went down Slightly

21:41

so there's it seems to have hit a

21:43

peak if you it's the equivalent of not

21:45

of the NFL not getting it Really any

21:48

bump for a deal in the US and

21:50

notably Amazon which had a few of those

21:52

games said actually we're out of the market

21:55

as well Hard to

21:57

tell if what that means about things like the NBA

21:59

in the US But do you expect

22:01

the NBA to get the money they're

22:03

looking for next year? Not

22:07

eight billion dollars. No And

22:11

you only tech player to come in and pick up some of

22:13

that stuff Yes, and

22:15

that would be the argument for why the

22:17

NBA rate could hit what they want I

22:20

mean what the sports leagues have resorted to

22:22

to try to keep getting These

22:24

big increases is the slice and dice. Yes,

22:26

the NFL is the best at it Yeah,

22:29

the NFL now has Thursday

22:31

night and three windows Sunday

22:33

and Monday night and

22:35

they're all with slightly different companies

22:37

So you've got Disney and Comcast

22:40

and Fox and Paramount aka CBS

22:42

and Amazon And you

22:44

know if they wanted to add you know

22:46

a London package and sell it to Netflix

22:48

or something they probably could the

22:51

NBA is currently with ESPN

22:54

and Which is Warner Brothers discovery

22:56

in Disney both of those

22:58

companies want to keep their packages even

23:01

though Speaking of saying things publicly

23:03

that you don't really mean David that is left keeps

23:05

insisting that they don't need the NBA They

23:09

need the NBA but they

23:11

can't pay the increases That

23:14

the NBA wants so the expectation for

23:17

a long time now has been that

23:19

That one or both of those people

23:21

will lose some games Which

23:24

the NBA will carve into a separate

23:26

package for a third party and that

23:28

could be Amazon It could be NBC

23:30

Universal. It could be Apple You

23:33

know the and then there

23:36

is a little bit of a wild card now

23:38

I think with this in season tournament that has

23:40

picked up a lot of momentum And

23:43

if you're not following the NBA They basically added

23:45

a whole new slew of games for a tournament

23:48

that kind of doesn't mean anything But it kind

23:50

of does and the players have decided that they

23:52

care about winning it It's they they they all

23:54

count as regular season games except for the final

23:56

which is this weekend Apologies

23:59

if I got the timing wrong on when the

24:01

epithet comes in. I had no idea

24:03

when the term concluded. And so they've

24:05

tried to get media interested. Like there

24:07

is some stuff about, there's a story

24:09

about Netflix being interested in the rights.

24:12

I was told that wasn't true, but you know, things change. The

24:14

best argument for the NBA getting the

24:16

money that it wanted or wants is

24:19

Amazon and Apple

24:22

being interested. Amazon, because it likes the idea of

24:24

having nights where people have to come in and

24:26

use the service, so if you can say like

24:29

Monday night or Tuesday night is NBA

24:31

night, that's very useful for them. Apple,

24:34

because Eddie Q who runs their media division

24:36

is like massive NBA fan. You can see

24:38

him on the Golden State Warriors bench basically

24:41

most games. And I guess it makes sense.

24:43

I mean, it doesn't really fit in with

24:45

their strategy of trying to really control a

24:47

sport like they do with soccer, but

24:49

you know, anything is possible. Yeah. And

24:52

I've heard the guys who own the rights

24:54

now say, well, what we think will happen

24:56

is we'll keep our games and the league

24:58

will slice off kind of a bunch of

25:00

garbage and sell that to Amazon because that

25:02

they'll be in the market for it. So

25:04

they'll get, you know, late December games. No

25:06

one cares about essentially. I

25:09

can't imagine Amazon or Apple says we're happy to pick

25:11

up the garbage. So I assume something has to give.

25:14

Yeah, there. I mean, it'll be

25:17

interesting. The Amazon was willing to

25:19

accept on the Thursday night football

25:21

package like year one of that

25:23

deal. There were a bunch of crappy

25:25

games and the ratings were poor. But by

25:27

year two, the games

25:30

got better and the ratings have been very

25:32

strong. I imagine if they were to make a run

25:34

at it that it would be similar

25:37

in structure. We write back

25:39

with Lucas Shaw. But first, a word from a sponsor. Support

25:42

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off. You're welcome. And

26:58

we're back. Let's finish up by talking about movies. There

27:01

is a ongoing sort of

27:04

fight, I guess, in movie world where

27:06

people want to say movies are back.

27:08

Is it a fight? Well, I don't

27:11

know. I guess two sides have to be

27:13

engaged in it. But there's an ongoing discussion,

27:15

let's say that, about whether the movies have

27:18

bounced back, whether moviegoing has bounced back from

27:20

the pandemic. Every time a movie does well

27:22

or kind of well or surprisingly well, you'll

27:24

hear people say, ah, it's back. Are

27:27

movies back? No. Why

27:31

not? We had Barber time. It was a huge thing. I

27:33

get shit on for this all the time because people think

27:36

I'm too negative about movies. That's why I love you, Lucas.

27:38

It seems fairly obvious that,

27:42

look, moviegoing, there was a

27:45

mistaken perception that moviegoing

27:48

was really, really healthy before

27:51

the pandemic. It had been declining

27:53

since the Internet, basically. Yeah, it

27:55

was healthier. Well, look, moviegoing has

27:57

been in decline for like... Six

28:00

decades. I don't remember. I'd

28:02

have to look at it. But the peak of movie

28:04

going as a cultural experience is something that people just

28:06

went and did every weekend was in the 40s or

28:08

50s or 60s. Right. And

28:11

I've published these stats before. Basically

28:14

the number of movies per person has

28:16

been shrinking at least since there was

28:19

a web browser. And

28:21

the 2010s

28:23

was a good period for

28:26

the movie business relatively for a couple

28:28

of reasons. One is the prices started

28:30

to go up in terms of the

28:32

average ticket price. And also you had

28:35

the franchises with Marvel and comic

28:37

books and all of this that created

28:39

a recurring story that

28:41

people showed up for. And

28:44

you just had all these big franchises that

28:47

made a lot of money and were relatively reliable.

28:50

And so where we are now

28:52

is two things happened. One

28:55

is the pandemic which caused

28:59

studios to experiment more with making

29:01

movies available at home. And

29:04

so people who are already maybe inclined

29:06

to stay home are even more likely

29:08

to stay home. And

29:11

you had a little bit of

29:13

a loss of interest in some of these tried

29:15

and true franchises. Marvel's not as reliable as it

29:17

was. Even Fast and Furious,

29:19

Mission Impossible, all these franchises that look a

29:21

little bit weak. So the

29:24

attendance is down. And some of that is because

29:26

they're not as many releases and you do still

29:28

have hits. And I think that if you had

29:31

full schedules with

29:34

a full slate with a bunch

29:36

of interesting movies, the movie business would

29:38

be doing okay. But we're still

29:40

15, 20% off from the

29:42

pandemic and it's not clear if it's coming back. And

29:44

I know just from personal experience, big movie producers ask me

29:47

this all the time. And

29:51

I was like, two of my anecdotal evidence is

29:53

dangerous, but two of my closest and oldest friends

29:55

who I grew up going to movies with all

29:58

the time have not been. back

30:00

in the theaters since the pandemic.

30:02

The other debate slash fight slash

30:04

non-fight is an argument that says,

30:07

audiences crave new stuff.

30:09

That's why the three biggest hits of the

30:12

year were not sequels. They were fresh, fresh

30:14

IP. But

30:17

then the next, if you look at the chart,

30:19

they're talking about Barbie, a Super Mario Brothers movie,

30:21

and Oppenheimer. There is no toy line for Oppenheimer.

30:23

But the other two are toys turned into movies,

30:26

which is the kind of thing we normally make

30:28

fun of Well,

30:30

one is a video game. Sorry,

30:32

you're right. I think

30:34

video games and toys are basically the

30:36

same. It's a product. It

30:39

is not an original concept.

30:42

They took a toy and made a movie, and they took

30:44

a video game that's been around for 30 plus years

30:46

and made a movie. And by the way, the

30:48

other seven of the top 10

30:51

movies are either sequels or a Pixar

30:53

film or IP that we have had.

30:56

Have we learned anything from what

30:59

worked best this year and

31:01

what sort of lagged? Or is this just

31:03

the function of particular movies and particular brands?

31:06

And if you think that Mattel is going

31:08

to have Barbie-sized success with the remaining, I

31:10

don't know what else he's putting out. But

31:12

he's, you know, in Korea, is going to

31:15

keep doing this stuff. Any

31:17

reason to think that Barbie is not a

31:19

one-off? Look, I don't think that every Mattel

31:21

movie is suddenly going to gross $1.5 billion.

31:23

That seems like a stretch. Especially

31:27

because Barbie is just one of their, if

31:29

not their most iconic property.

31:33

I have a hard time discerning

31:35

like grand new lessons from.

31:39

What were your podcasting, Lucas? From the whole

31:41

point. We need to have. I mean, look,

31:43

people want like good movies.

31:45

They want fresh takes on

31:48

things that they know. I think

31:50

we went through, we've gone through these cycles

31:52

of Marvel and DC, and they're not over,

31:54

to your point, like Guardians of the Galaxy,

31:56

volume three, did very well. People

31:58

liked that movie. or

32:01

this new Hunger Games prequel

32:03

did okay. I

32:06

was skeptical that anyone would care about the Hunger Games, but they

32:08

made a decent movie and so people showed up to see it.

32:11

I do think we'll see

32:13

a lot more video game adaptations because

32:18

we saw just this year HBO had The Last of Us, which

32:23

was critically and commercially

32:26

successful. This movie was Super Mario

32:28

Bros. I think Hollywood has tried

32:30

to do video game adaptations for a long time.

32:32

My son told me a month before

32:34

it came out that he was going to go see

32:36

Five Nights at Freddy's, which I'd never heard of. Turns

32:38

out it's a popular video game. By

32:40

the way, that movie was streaming the first day that it

32:42

came out in theaters and he and 10 of his nerd

32:44

friends went and saw it. Many

32:46

other people did as well. It was a big hit. That's

32:48

an example. That was

32:51

produced by Jason Blum. He had two

32:53

movies come out in October. I think a lot of

32:55

people thought his new

32:57

installment in the Exorcist franchise was

32:59

going to be the big hit because the

33:01

Exorcist was such a huge smash when it

33:03

first came out. That

33:05

movie did terribly because most people didn't think it was

33:07

very good. The video game adaptation

33:10

did great. I don't know. That

33:12

doesn't mean all video game adaptations will work. I

33:15

do think that that's one of the areas.

33:18

There are these bankable pools

33:21

of intellectual property that Hollywood just comes

33:23

to rely on in

33:25

certain eras. It could be that in

33:27

the 2020s, we're

33:29

going to be trading comic

33:32

books for video games and

33:34

anime and other new things.

33:38

Maybe podcasts, we can have the Recode Media

33:40

movie in 2027. Yes.

33:42

Who's going to play me? I'm going to play

33:44

me and it's not going to do well. I

33:47

ask you every year about, or the last couple of

33:49

years, about how Hollywood is responding to TikTok, which

33:52

to me seems like a kind of existential

33:54

threat because it's just

33:56

enormously addictive. People are happy to spend time. In

33:58

my Hollywood, I mean it. anyone putting stuff on

34:00

a screen that they want people to watch. And

34:03

I've never gotten, not from you or anybody else, I've

34:05

got a real answer about how they're going to deal

34:07

with this thing that draws an enormous amount of attention.

34:10

It doesn't seem like it's going to get banned. Do

34:12

you get a sense that anyone in your industry, that

34:14

the industry you cover daily has gotten

34:16

their head around what they want to do with

34:18

TikTok? No, and if anything, they

34:20

don't talk about it very much. It doesn't

34:22

get talked about as much as

34:25

YouTube when YouTube was new. I

34:27

mean, maybe that's just because TikTok has

34:30

already crossed the threshold into being something

34:32

that everybody uses, but there

34:34

were years of hand-wringing over

34:36

YouTube because that felt like

34:38

to some of them sort

34:41

of like theft. And YouTube

34:44

spent its early years trying to convince the studios

34:46

that it wasn't stealing their stuff and spending a

34:48

lot of time developing technology. I

34:50

don't know. It seems like people have sort of already

34:52

moved on to AI and they're not spending as much.

34:55

Smart people in the

34:57

industry recognize that YouTube

35:00

and TikTok have

35:03

taken a significant chunk of

35:06

their business away from

35:08

viewers. People like

35:11

your son probably spend more

35:13

time on YouTube and TikTok than

35:15

they do watching that thing. By

35:18

a large multiple, yeah. Correct.

35:21

Now, it's unclear if as

35:23

he gets older, that

35:25

ratio tilts, right? It's

35:27

totally possible that some of this is much

35:29

as when I was a

35:31

kid, I watched way more of MTV

35:35

and I

35:37

don't know, well, Nickelodeon, MTV,

35:39

ESPN, than some of the

35:41

others. That you're going to grow up into something

35:44

else. Yes. But I watched a lot of movies as a

35:46

kid, and

35:49

a lot of kids these days don't. So anyways, we don't

35:51

need to talk about the kids these

35:53

days. But I think it remains

35:55

to be seen what the long-term impact

35:57

of YouTube and TikTok are other than...

36:00

So, one of the things I think

36:02

about a lot is traditional film and

36:04

television, while it still matters a lot,

36:06

its sort of share of cultural mind

36:09

share is shrinking. And

36:12

that's because of YouTube and TikTok. And there isn't

36:14

really an answer for it. And that's another reason

36:16

why I think AI in

36:19

the macro sense is scary for them. I

36:21

think right now it's not as scary as

36:23

people think it is. You're not going to

36:26

suddenly make Disney, Marvel movie

36:28

for $20 million and replace

36:31

everyone. But you

36:33

do have these different tools

36:35

that are training a lot

36:37

of creative output and that will

36:39

be able to spit out things that people can

36:41

consume at no cost. Because that's the competition. If

36:44

I can watch something that is

36:47

maybe not as great as an HBO show, but

36:49

it's free and it's quick and it's served to

36:51

me efficiently on my phone. A lot of people

36:53

are going to pick that. Mm-hmm.

36:56

Lucas, you get the last word from

36:58

this last episode of the podcast. What's

37:01

your favorite bit of media you consumed

37:03

this year? This is

37:05

not the answer to it, but I was

37:07

thinking like two minutes ago that you were going

37:09

to ask me about music because you often do.

37:12

So, I'm just going to tell people to go listen to the

37:14

Black Pumas because I love their music and they have a new

37:16

album out. How does it compare

37:19

to the Andre 3000 flute

37:21

instruments album? I

37:24

had more fun listening to an interview with Andre

37:26

3000 than I had listening to his flute album.

37:29

Was that the one where he said he gets into

37:31

the cab and starts playing his flute and the drivers

37:33

love it? He was talking

37:35

about playing his, it was an NPR

37:37

interview with Rodney Carmichael. He

37:40

did talk about how you just sort of take out his

37:42

flute and play it anywhere. I don't remember if it was

37:44

specifically in a cab. That's

37:46

the kind of thing you can only do if you're Andre

37:48

3000 because everyone else says, would you please put that away?

37:51

I did not want to hear a flute. We

37:53

have a music recommendation. We have a lot of insight. Luke

37:56

Ashaw, this is the end of Recode Media. It is not the end

37:58

of me talking to you. be back on

38:00

at a more reasonable hour

38:02

for you. Do we have a name for

38:04

what is... No, you got ideas? We'll

38:07

come back to that. I'll think about it. Lucas Shaw, it's

38:09

been great talking to you. Be well. Thank

38:12

you. Thanks again to Lucas Shaw. Thanks

38:14

again to our advertisers. I forgot to shout out advertisers

38:17

at the top of the show, but we

38:19

really do love advertisers. They keep this thing

38:21

going. They keep us all paid. We love

38:23

them. Keep advertising, advertisers.

38:26

This is Recode Media, Peter Kofka, and

38:28

I'm going to see you next

38:31

month sometime. See you soon. Looking

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