Hello Hello Welcome to the media media addition of slate money or guide to the business and finance news of what what was a very busy week. I am Felix Salmond Axios. I'm joined by Emily Paphos. I'm joined by Anna Szymanski off breaking breaking views. Hello and because we love him so much we have the best person coming back to join us. Ed Lee from the New York Times the media media the media reporter covers all things media at the time and is here to talk to us about spotify in the Plus Aikman and also about the New York Times itself. He's getting very navel-gazing. In this particular issue has media reporters are are wanted. We're GONNA talk about instagram. We're going to talk about out youtube lots of media content this week but also of course Tesla content. Because what's gone. I'm a tesla if you want to know whether to buy you can do things you can either just google. Should I buy desert stuck or even listen to slay money. We will answer that question for you coming up on on slate. Many sleigh money is sponsored this week by the relentless in new podcast from Sleet Studios and century twenty one real estate. It's a podcast about extraordinary people. People and the mindsets and behaviors that drives them to achieve inspiring things hosted by Dr Cynical psychology. Julie GonNA and she talks to Thought leaders in venture capitalists and entrepreneurs about the qualities that set them apart. How they approach success? You'll hear about what they've learned from their triumphs how they've grown for rejection continuing to evolve and what they've learned from what they did right. Listen and subscribe to the relentless today. Wherever you get your podcasts so this is this is the segment where we talk about? Google fetches I I have my google up and we have old tried this with various degrees of logged in an anonymous in. What's browsing for me when I type should i? Hey buy into Google. The first auto fill is should. I Buy Tesla stock and then it's followed by. Should I buy apples talking July bitcoin so I get I all have two types. This should get US shoot. I buy stock. Wow but then after I get that I get should. I stay should go lyrics type should and I got should I buy Tesla's bliss stock and should college athletes be paid which yes and no respectively. Dubai has no. They shouldn't be it is also got. Should I buy Tesla stock and then I got. Should I get bangs. And should I text him all of those. Yeah absolutely no. That's that's good. I think people whether or not to get bang. I know I don't understand what kind of advice Google doesn't. I guess they know you. Well enough could just be no. You're knows you so well could you say not for you honey. So the answer to buy stock. It's obviously yes. Because it's what's crazy is how to make lots of money right now. I know you're contradicting yourself. I mean everyone reader newsletter and knows that you said what goes up really quickly must come down really must come down probably well I did say that if can behave like that if it can melt up and Basically doubling value in no time in the way that Tesla did it is equally capable of melting down and investment happened. Twenty four hours after it went up right. I mean so we had we had positive. Okay let's have a little brief history which Tessa was worth thirty. He one billion dollars back in June which is probably a reasonable amount of money for Tesla. If not a lot of money tesla we you know it's a car company. And that's how much he's call companies worth and then suddenly in twenty twenty. This has gone on absolute tat and they went up and up and up and then after going up it went opt not not and then suddenly this week is stopped going up and started screaming up and it would go up like ten billion dollars a day. Seventeen billion dollars. Twenty billion those day it hit a peak of like almost a thousand dollars and then because it's just that point of gambling vehicle love an actual combining. It's been a gambling vehicle for a long time. Actually so the other history on Tesla's talk beyond just being the new company and worth more than GM and Ford all these established a AH carmakers at producing million cars. A year versus task producing hundreds of thousands of year. There are a lot of short speculators against Tesla. In addition to bowls are basically people. You Bet that the stock will go down right and I think that had an effect this week when it's okay so so like I have done a bunch of Whoa. Let's get into this. I think the an-and I are in agreement on this one so I looked at the Tesla shot because that's how much of an lamb and I immediately said. This looks exactly the same as the CIA of Volkswagen. Chaz in two thousand eight. Because that's how much of a net I am and in those of us who remember Volkswagen in two thousand eight remember that it was the mother of all short-squeezes and it will it briefly became the most valuable. Oh Company on the planet and this was all to do with a bunch of financial engineering by Porsche which bought up a bunch of Lake options which gave it control control of the overwhelming majority of Volkswagen. HSIEH's so what you had was. You had twelve percent of the shares of Volkswagen with short and shortsellers had borrowed twelve percent of the ordinary shares have Volkswagen and then had to buy them back and they expected and hope that they would be able to biton lower price. They paid for them between them Porsche. And the state of Saxony in Germany owned ninety four percent of Volkswagen shares. And they want selling with the state of Saxony. I didn't know that state of sexy can own. Okay there you go so that you saw certain states attacks neon twenty percent of Volkswagen and they went about to sell so these Schwarzer's you basically twelve percent Volkswagen the short and only only six percent of Volkswagen available to buy so all of the shortsellers when they win the press release went out saying we control this much Volkswagen. They desperately tried to buy the stock back in order to be able to cover their shorts. Of course only half of them could get to the excess in time a now this insane short-squeeze and this is still to this day. Twelve years later later being litigated in various courts like Bam lobe and a whole bunch of people lost a fortune and it was great. That was short squeeze that is a classic. Yeah often anytime. There's any type of short-covering people like it's a short squeeze. No it's like yeah. It has an effect but it doesn't have that dramatic effect supply demand issue. With in this case. Influ sorry because I when you said Saxony. I just drifted off off with that. It was basically like they needed to buy the stock but the other people weren't Simon stock so it just exactly and then in general bail out of the ship in general the way the short-squeeze works. You don't need that kind of artificial artificial thing but in general the way the squeeze works is you borrow the stock and then sell it. The person who lent you the stock doc wants some kind of collateral because you're you're entering into a loan agreement and then if the value of the stock goes up the person who lent you the stock and his kids you what's known as a margin call and then let you have to put up a bunch of money in if you WANNA keep on being short this stock and then the more the stock goes up the more money you need to keep on putting up and more usually until eventually you end up capitulating and end up buying the stock at a crazy high level. All of that buying pressure from this shorts keeps on pushing the price up as this like dynamic where the more shorts there are the more buying pressure on stock because the more shorts. There are more people who I need to buy the stock that was not happening with Tesla. The Tesla short interest right now is lower than has been in years. The amount of activity in the stock means shorts can cover super easily without affecting the price because the amount of volume in Tesla is enormous so buying pressure. Russia from shorts doesn't affect the price because literally we had one day this week where there was sixty billion dollars of volume in one day in Tesla and and so no amount of short-covering going to really even be a drop in that bucket. So the the idea that the reason it was going up was because Schwartz covering I'm buying lying the stock and that was sending the stock up just doesn't pass the smelter meaning it even. If that were the case it wouldn't count for that much of a rise it would. We saw it count amount for maybe like the price going up by a buck or two. It doesn't account for the price going up by three hundred was it. It was just individual traitors on Robin. Okay so this is what was your what it was. I will tell you what I'm everyone here. Everyone wants to know. The answer is the stock went up. Wasn't a reason that is the best answer but it doesn't explain the phenomenon of I mean Hamilton. This hero explain. Why has your here? I'm just like looking at the movement of bitcoin overtime. Like there is not a tremendous there. You off you can get into these speculative bubbles and where they're just simply is no good reason and you can try to come up with a reason and you can come up with all these theories but they're all all going to be somewhat false. The reality is that in theory. The stock price is supposed to represent something about the value of a company. And when you have something moving this dramatically ethically. There's nothing possible that happened. That could have changed the market value of this company the intrinsic value of the company that dramatically even even technical factors you. Yeah I remember getting to a big discussion with Luc our Bloomberg about this. You know he had this whole theory about people buying Cole's Delta hedging out. That's that's whatever anybody starts telling you delta absolutely no but the point the point is that we as human beings absolutely lutely desperate for narratives in causation and we see something happened in the markets them must be a reason. They must be a narrative. The must be a causal relationship has somewhat and sometimes such isn't but isn't the. I agree with that but in this particular case like the velocity of trades the velocity of the movement was such that you kind of feel like there had been. Something I mean isn't as simple as I don't know was it robot arbitrage. Well how do you know that. How can you say that's it? That's it now. Where does that coming because okay this is? This is what I'm saying like I'm saying this stock price is Brandon's to cast it gambling vehicle thing which is just behaving like a demented rollercoaster. And there's no sort of causality causality. That and you're saying wait. This is so crazy that must be a reason. What I want you to do is to examine that statement and to say like what reason do you have to to believe the whenever that's crazy price activity there's always a reason because the market is not as diverse as we think it is in other words there are only so many like a lot of retail invest? Regular Mama pop there. Aren't that many of them. It's mostly big funds and Whether it's it's hedge funds and or you know calpers there's like retirement but there's just there's like maybe a hundred big players that move the market in so many ways every single day and it's not like hundreds of thousands of indigent people. Okay Kanaya night pen and all of a sudden when an interesting wrinkle history. What is the biggest largest most solid pot off? AWW long-term stock market investing capital in the world suddenly in America the onset is S. and P. Eighty five hundred index funds. They just sit there. They buy the entire index. They don't do anything sometimes. They'll repair it out. Sometimes they want passive index is very very no no. It's not not just passive in terms of buying the the passive market. which is what they do but passively buying the S&P Five Hundred Eight? Okay and Adam is GonNa tell you what is the the single biggest company that is not in the S. and P. Five Hundred Tesla Tesla. Tesla has always been weird outlet Tesla. Let's not any S. and P. Five hundred because it hasn't ever had four consecutive quarters of profit and so that means it's eligible for the S. and P. Five hundred and said that makes the the holders of Tesla much more diverse than holders of virtually any other stock. Oh there we go. I like that explanation. So it's more diverse diverse and there was no reason but maybe at first there was no reason when it first started going up but then as our Google search results show us people went nuts and that is part of the reason because people are like Tesla so cool Elon. Musk is like iron man. Oh my God like there is some some bit of that driving at any bubble has that type of elements. There's a kind of thing going on. But there's also what happens in this is is this bizarre phenomenon that you get in sort of late. Capitalism is to people think about think that the stock is a good investment decisively. Because it's is going up and and they see the stock going up and they're like. Oh yeah this is the market. Ratifying the thesis that everyone's going to be buying electric vehicles. That Tesla has an insurmountable lead in the AV market. That has this gigafactory and Shanghai which means it's going to have an insurmountable lead in China which is going to be the biggest calm in the world that there's this new news coming out from Panasonic saying the bathrooms. It's making a now a profit center and Dan all of these different data points coming together and then some random entity called arc research putting a price price target seven thousand dollars a share and and all of this kind of stuff and people like. Yeah this is GonNa this is GonNa be the the new big thing. And so Tesla at that point just becomes this dream almost like the financial equivalent of a lottery ticket. Yeah and you go in that and I'm going to buy the dream nights I just I don't know I I. I don't believe that there are that many. That's the that's all the articles. The Times robot story but journal also but then combine that with. Let's say the you. Are you own stock right. Let's say you're not mind that the severe just someone who happens to own it and it goes from you know two hundred two hundred dollars three hundred to four hundred five six seven eight nine you know and then some some of these retail investors typing. Should I by Tesla stock into Google. Come along to you in light. Can I buy Tesla's Doug Fuck no like this is what can listen. I'm loving this rocket ship. You even if it folds another fifty percents. I'm still up like a GAZILLION dollars. Why would I want to sell so what happens? Is it becomes harder and harder to find biased because polders late why while enough so and there are no robots in this there no hedges and there are no guys but there is huge volume contradicting myself because the volume was way too high for yeah. Of course they're going to be involved but I think you also have to be a little careful because there's a tendency anything weird happens in the market now for everyone to be like it's the robots. The thing is like the people who are making these are not like simplistic things that are just like. Oh this tells me to keep buying so I will keep buying. They're very complicated. So it's actually somewhat unlikely you're going to get that type of movement just from high frequency traders right. There are from like I duNno I concur for lots of weird moves. day-to-day move so not that type of move. So it's true that you can see high frequency trading move like these little mini flash crashes which happening in almost every major talk and pretty much every single day and they over time Pierre they loved for maybe but you know they're robots responding to other robots by mounting? What caused those those kind of cascades you can see them lost? You can see them every day and you and they love for seconds they don't loss in quad traders are it's not as simplistic I think at sometimes portrayed as though like oh well it one thing happens in the cascading effect. No like these are. These are very sophisticated. -tated I have. No sound are sophisticated. I think the outcomes aren't always sophisticated. That's the difference I think they're they're overly complicated at the outset. But the outcomes what it ends ends up executing doesn't always look like what you thought it was going to look like which explains which explains the complexity but at the same time. It doesn't suggest that the outcome is equally. Complex is what you're in any case my my big takeaway from all of this is that everyone is being including us being distracted by Tesla stock as this weird animal which behaves in very autumn peculiar way as the no one can really understand and it is a distraction to us. It is a distraction to Tesla. It is not actually helpful as a company and this only serves to ratify Elon Musk's desire in two thousand eighteen funding security like take the fucking company public private rather take take the fucking company private at four hundred twenty thousand which was a perfectly good price and then if he done nat like looks possibly maybe as though that might in hindsight. I've been reading and and bargain. And then he wouldn't have had all of this bullshit wouldn't be happening and he could just concentrate on making curves. Yeah but now. He's set to get some like insane payday if the stock price holds holds right so a hundred billion valuation over sixty six months and you can't fall below a certain amount gets he gets off but compared to how much he just like. Disguise network is up twenty billion dollars this year alone. So it's like it's a lot of money but it's less beano. Who else made a huge fortune this week? Jeff Larry Ellison Larry Ellison owns three million tests issues so that you know and the Saudis are they know I know they got out right before really. WHOA that was a bad trade? Good things they didn't know anything in any case Emily as as the closest thing we have in this room to Google. I'm GONNA ask you. Should I buy Tesla stuck. I mean it's come down now right from from the high now maybe it could bounce back up now. Don't do it unless you don't care about losing money I think don't we always say don't don't gamble on individual stocks. Is the new. Bitcoin join like yeah I think. It is plausibly I mean it has some more kind of a reality to its valuation bitcoin. There's something there they in fact do actually produce covers something. Bali seductive about the argument that like it has the lead in in like once the world finally stops relying on gas in switches over. It's going to have the all units like that is very value and the company. I don't think there's this much value in this country but you know look we've seen this with a lot of growth growth companies that have done very very well over the past ten years that you know when you're buying a company like this you are not buying it obviously based on earnings. You're buying it based on your lying it based on expected earnings. Your and you can't exactly put a great price on the future where you're just like I. It seems like it's at this moment. Where as you said either itself itself will become very large or at some point get acquired so one of the mechanisms here which I think the Tesla Bulls love to glum onto and suddenly Elon? Musk has. It's been banging this drama lot. Is this idea that it's the first car company with Lake Internet scale network effects that he has gazillion hours of data. Already firm caused has been driving around and no other. Auto manufacturer has anywhere near that much data and because he has that much data his comes become better and become closer to self driving more quickly. Because it's very data heavy kind of problem to solve twelve and so people wind up buying the Tesla because Tesla has better data and the more people who test because the best attested states have becomes the becomes as insurmountable lead. No one can compete. You know I think that probably false and I think that within a few years that will be of UH EV manufacturers competing with Tesla but it suddenly through right now the in terms of network effects not only in data but also intensive charging stations. Tesla has this huge. You lied and it does make a lot of rational sense for someone buying an e to buy a tesla just because network and I've also heard people say that when you're figuring out how you're you're valuing this thing that you're not you're looking at it not just like a normal car company you're almost looking at it like something like an apple where you have hardware in theory you. US software and you have services like you you have a combined. It's going to trade at a higher multiple. I'm talking about buying cars rather than stock here. I'm saying that people by talk about the actual car buell. Musk has been making this a K.. Through wild the car is an investment like at some point the day day to become so rich. The you're going to be able to rent your car out to the sites right. Yeah and that actually is very important. That is actually a big part of his idea behind this valuation attention is this kind of like robot taxi idea in these ideas that that yes exactly. You can actually make money when you're sitting at work because your your car is driving ours. The self-driving snake oil that that's not real that's not gonNA happen not for decades and decades. It might happen in highly artificial parts of you know the bit of Toronto. Google is building or something like that or if there's like a a special lane out of the airport that takes you a mile outside like terrifying you correct. That's basically mass transit. That's just a rail system without rails so a slave money sponsored this week by Ziprecruiter twenty twenty new year new opportunities. This could be the time when you take secure business to the next level by hiring the right people. Finding qualified candidates can be challenging. That's ZIPRECRUITER DOT com slash money. He comes in and makes it super easy and indeed flee they will send your job to over one hundred of the Web's leading job boards but they also just know who's looking looking for. 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I claim service with twenty four seven support online or by phone. It's no wonder why more than twenty million drivers trust progressive and why they recently climbed to third largest auto insurer in the country get a quote online at Progressive Dot Com in as little as five minutes and see how much you could be saving auto insurance from Progressive Casualty Insurance Company and affiliates. Home in Renter's insurance not available in all states provided in service by affiliated third party insurers discounts Sperry and are not available in all states and situations. Okay so you are. The media media media correspondent to rebrand myself is the media media reporter at the New York Times or is it the medium medium media reports because there is social social media. There's is there other media. I think social media. I feel like we've now. We can now splits media into media media in such media very well so the media media media story is getting interesting. The Neal Times you're very employer just came out with some pretty amazing subscription numbers. Oh Yeah I was surprised myself. Actually I mean I've been tracking the company for a while but I think we are now at five point two million subscribers altogether that includes print. But if you're looking at just the digital it's four point three and change which again. I'm surprised by and there was definitely the the trump in two thousand sixteen that if if you look at a chart there's this nice swoop up And then at levels a little bit but then it continues to go up so you could argue. That is still trump is he still in office but Even and after things like the Mullahs report. When that was a big disappointment for the left like subscription still kept going up you know there? Is this sense that Oh as soon as this sort of whole thing starts to fizzle one one way or the other no one will be interested and and in a show of Lake interesting show of confidence here the New York Times for the first time I think ever has decided to increase the price of the digital subscription like Netflix. Just did that last year for the first time the big digital price hike now the New York Times is doing and and moving up from fifteen to seventeen dollars a month right. which so these all? These prices are interesting right. Netflix is about fifteen sixteen or thirteen for for a basic subscription or the standard subscription New York Times about fifteen going up to seventeen. They're all similarly priced who spotify is. What is it ten? Yes yes spotify. Ten who who was like six you'd have to have sex with ads or twelve without pluses six grammy any pluses some differences between like Disney plus in the New York Times. Yes but I forget. The price point forces consumers Immediately compare them in a lot of ways and it's fascinating to me of all of those. The New York Times was basically at the top of the was the most expensive and now it's becoming even more expensive well but compared to like the Wall Street Journal and the Financial Times it was less expensive less expensive but I guess that's the other sort of value proposition right which is ah. FT In the Wall Street Journal which I think are great papers lady too but it's special professional where it's a niche or it's a it's a more specified market as opposed to potentially potentially everyone now they would disagree with that right. I'm sure the journal especially with Israel that no we are meant for all educator readers everywhere you're interested in living in the world and we live in a capitalist society. You want to read the Journal. I I think that's a fair pitch. But if you look at the the array of content I think part of what Helps Times frankly. He's all the nonpolitical coverage as well as a book right. I mean I think the the big story. That's really interesting. Is that the The New York Times a newspaper has managed to. I think we can say confident. We now transform itself from old media newspaper into a subscriber-based media. two-way digital media digital media are coming from advertiser driven because the advertiser advertising critizing revenue keeps falling falling falling to subscription based revenue. And this is now. It's not just you could. You could subscribe to the New York Times online. You can also subscribe the New York Times cooking the cooking and the crossword at both do and they're separate APPs to. Interestingly like and I was told this anecdote like the cooking APP A lot of the subscribers are not near times readers midwest an and people in the Midwest do read the New York but relative taste to it. It's not a subset cooking and crossword it's really subscribers and not entirely a sub so that was the other thing which was fascinating to me. He was the digital ad. Revenue went down so that is still a head scratcher. I'm surprised by that right because it's a it's a growing qualified audience right and you are not aren't doing as well and advertising against as you did the previous year so you have more readers this year than last year. But you're selling fewer ads. That surprising I don't know I wonder if what what's going on. There hasn't really gotten a good explanation for why that's happening bill. More broadly across digital media display advertising has started flat and I think I think more broadly the big trend in digital advertising. Which we've talked about many times on this show with and without Ed Lee is the? It is all just getting sucked into the gaping more of Google facebook. The the awfully no one else can fullerton. which is why subscriber revenues that much more important whether the New York Times or net flicks or almost anything else is at this point If you're not gonNA facebook the other thing about the New York Times we're talking about media old versus new print versus digital they did surpass Pretty important milestone that they had set for themselves selves eight hundred million digital revenue. which they just pass this? The ended the under last year a year ahead of their intended target. Despite the fact that digital ad revenue went down. They you were making so much money subscription revenue they hit and so they made a lot of money from the make a Lotta money from the daily podcast. That's the one area where sponsorship against that all right which is and they making money from from who from its its Hulu tiny little revenue. That's a relatively. Yeah that's a TV. Show the weekly show that airs both on Fx and on Hulu and they're both supplying the times with money to fund it so that's really helps the top line but it's it's it's very small. There's also the wire cutter. Which is the review site and there's affiliate revenue against that which certainly helps I mean it was a very photogenic. Eight hundred million that it hit eight hundred point eight million the precise precise number The more important context around that though is the you know the conceit around having a big enough digital business so that you don't use rely imprint. So we're printed just disappear tomorrow tomorrow which it won't but let's just happen all of a sudden you still have an eight hundred million dollar business. That's growing so I think that was the the sort of the mental hurdle to get past that can we we survive as a as an online only business. Yes most likely again and I think that's really interesting size reading a piece this morning in. I think it was BusinessWeek about Warren Buffett. Getting out of the newspaper the business and the way WHO's in it. I mean according to the he loves newspapers used to deliver them whatever. And he's listening you so brilliant. Brilliant right and there are all these like investors getting into The newspaper business managing its decline. And these guys are just. They're not. They're not sure smart hard about they could have re the times. Reinvented Muscial jump on you. Only one on New York Times. The Warren Buffett's newspapers all local newspapers. No local newspaper can do what New York Times said. You can't get a local newspaper with five million in digital subscribers obviously especially not charging William charging seventeen dollars a month which is in order to be able to find five million people paying seventeen dollars a month and as we've said that is not mass. Market price is a premium price. It you need to be targeting and one person who used to sell time subscriptions. They explained to me basically the top fifty percent of college graduate. That's who you're going after and most Americans aren't everyone should have done what the times to reinvent themselves. I'm saying the times had people running it. That cared about the times and they did and different stuff and not everything they did was successful to reinvent themselves. Meanwhile in the rest of America newspapers they just didn't didn't have the the people behind it to reinvent that have died is the reason and the reason. Why is that could have happened though? But the reason why that is not true through and as a very good reason why that's not true. Is that if you look at. Across America there are. Thousands of newspapers is across America. The valve which local newspapers only one newspaper has been able to do what Neo Times has done in New York Times and the New York Times is completely sweet generous onerous and you would think if what you're saying with true that like Oh you just need to try a few different things. Maybe one of them will work if if that was true. Then you would think those statistically speaking at at least maybe eight or nine if these little local places would have been able to have some success and you anything. If wasn't because as smart as everyone said he could have taken his wealth and his alleged strategical brilliance and. He had a bunch of newspapers because he he doesn't do that. Warren Buffett is not so much treats value in companies. He's he's his investment thesis is. I'm going to find value where other investors have not seen it then own own that versus. I'm going he's not a he's not a guy he doesn't and to be fair to his whole thing often like I am going to find something. That's an excellent brand that has a moat around around it Whereas that is decidedly not the case with a lot of these newspapers and also? I think it's important to like the success of the New York Times is also going to eat into all of those. It used to be that you had your local newspaper. And then that's what you're now you can get the New York Times and I think I think that's the Internet has sort of broken that barrier down where I mean sad to say like show for for every subscriber new subscribe the New York Times Gases potentially one fewer that the L. A. Times for the Chicago Tribune. Get right so we been the New York Times is set up really as a national final paper And and in railway in a very immediate way and so it's great for the Times but overall it kind of shrinks the news pie. Unfortunately and I think that's the bigger conundrum beyond just you know I think you're right. I think the only one that's really doing it had this brand. But you have these others trying to find. I think it's no. I think there's a clear second tier which is the Wall Street Journal and the Washington Post I think the posted probably argue with you and say hey actually no we are I here and and there are people who like are deciding between the Post and the Times you know. I think maybe the Journal is one of those who are like you know what I get the journal plus something else right whereas the post is trying to be a I hear in your I read set teams La Times. I think Chicago Tribune like they're in a complete different situation. Where the in order to all of these properties not have national ambition? Yes that is you have you have. And that's the thing. Maybe you can't be a local paper anymore. Maybe that whole concept doesn't exist. It's not not as a profit model. I mean I think the only way you could have local papers as if it was something that was like publicly funded as a not. Yeah yeah which that is something that you know like Laurien jobs who she's thinking about that working on it and trying to figure out ways that you can create a model around everyone is everyone is trying to make local news. Work like apparently patched still exists and is maybe it's crazy to me is maybe like making money somewhere doesn't doesn't interesting model going on in Berkeley side. They just opened a new publication covering Oakland and there are interesting interesting local news things now often based on some kind of non-profit model but the idea that you could have a public company with what the market cap of The New York Times now a billion plus from well over that no maybe it's getting closer to six But like feeling a few years ago. It wasn't a shirt like we're all looking at the time now. I think that this was the the inventiveness and The creativity put into reinventing. Their business is not not something seen at other in other places and other news outlets like the Washington Post. Maybe you can make that argument now but more. It's just like they figured out the Internet not a little bit I e but they haven't approached reinventing news media the way. The Times has which I think is interesting and I I don't I don't think that other. Do you think that the really inventive thing was that the Times did in terms of reinventing news media. I think the way they a a I think the daily was inventive. They weren't the first to do a daily news podcast but they kind of I mean everyone listens to that to that show because they did it really. Yeah well and no one else had sort of done before. Everyone has copied them since. I think the cooking APP is really smart. I think people had tried to do to subscriptions before and it hadn't the work I think they approached everything with a level of excellence that I I haven't seen in other places and I think they are almost more becoming like a like a lifestyle brand like it's not just news like the the The Washington Post is still fundamentally news and I think the Times has a lot of what they do is not really. Let's be honest like hard news. There's I mean it's it's stuff that's fun and it's it's it's stuff that you used to more get in magazines like in the are using video audio in really interesting ways but it is it is just such a different animal to compare it to almost any other. Newspaper doesn't make a lot of sense. I think I would everyone saying here. I think it's it's success is a hard hard thing to explain. Frankly beyond the excellence argument. I mean the journalists was charging people online from the first day being on the Internet. So it's not like it times. It's just sort of following following in the footsteps of what other companies had been doing. It's just the specific blend of things that it had. Maybe an at the specific time that it did it that allowed it Sir succeed need but again. It's hard to explain we. Yeah we should be happy that the New York Times the succeeding. But I think it's a stretch to then say well if you didn't manage the succeed Z.. Like New York Times did that. I'm just saying They tried really hard. And I don't know I think about people read her and then it makes you sad to see bees hedge funds coming in and buying up these newspapers and just managing their decline not and not even trying value out of newspapers still still generate a lot of cash flow. So I think that's what they're four. Unfortunately by the way six point two billion market the current market cap of the New York Times. The move is making money but people should know I mean it is a publicly traded company you can buy the shares and make money off of that but is firmly Armley controlled by the OC Salzburger family There's a second class of shares that you aren't Oakland traded that the family owns and those shared the media companies companies and it's to protect the journalism it's not just about profit and with family controls. two-thirds of the board so Carlos Slim could buy every single openly share and still only control a third of the board right. We don't need to worry about Gullikson controlling the town or anyone for that matter outside of the Family Furnao but I look forward to the day that the New York Times dog becomes like the new gambling vehicles contest. If you can't see the whole picture how can you tell what you're looking at. 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Yes two thousand nine hundred Neilson report limitations apply but let's talk about the social media the other side of the media coin which is where the real money real money media maybe ruining the New York Times annual revenue on on. Oh let's just say annual ad revenue where we at now I think the digital is something around two hundred and sixty and then another print about another two hundred sixty or three three hundred billion less than half a billion dollars or half a billion dollars for ad revenue. Now compare that to ad revenue at. Ah You tube which is fifteen point. One billion compare that to add revenue instagram which is twenty billion and these are subsidiaries of the real money business right facebook blue and Google search these are the actual of the daddy businesses Youtube and instagram are sort of these. One time errant hobbies turn into massive massive massive. Thanks I think however YouTube is not a real business I suspected for years that it loses money and I think even seeing his current financials I still think didn't didn't they didn't reveal whether right because this is the difference between obviously youtube and Instagram Youtube. Most of its revenue is going to the content producers which is not the case with instagram. Is it folks to fifty five cents at every dollar goes to the actual creators right. So the whole conceit of Youtube right. The original thesis are in Youtube is you. You don't need television anymore. You don't need to pay for programming. People create their own entertainment. And guess what they do. Five hundred hours of video uploaded to youtube every minute. That's insane insane. So there's a whole wealth of expression out there that just sort of lives on this on this repository gold youtube and so you know you play it. You let you download it. There's Advertising against it most of that then goes to the people creating the videos youtube increase. Anything right or most. Most of what's on there is not created by Youtube. So fifty sunset everydollar go see the actual creators. They take forty five cents so they they're real revenues more like seven billion. Let's say right so I looked at it thinking like all right. It's seven billion. How much does it cost to run? The fact that they didn't reveal that I think is very telling. Unfortunately we don't really have a comparison. The best comparison I think it's net flicks there. A similarly sized business in terms of a lot of video out of the Internet video on the Internet is actually very expensive. You know we tend to think of it being. Oh it's easy it's is relatively free and and date is is cheap But for large operation as it is the band with it sucks up the staffing everything cloud computing servers etcetera. So the close. Comparison being netflix. If you take out all the content cost what they spend on content. It's something like seven or eight billion that Netflix spends every year just to maintain its business right. So if it's if there's there's in any way a mirror of the costs at Youtube I think youtube loses money but it is this time suck for people with Google accounts amounts and it just keeps people inside the Google ecosystem. Put it this way. Google paid. What like four hundred million dollars youtube something? It was like one one billion dollars. uh-huh billion dollars like that. I mean that that has to be up there with instagram is one of the great acquisition. Oh absolutely it's it's. It's a fundamental the mental part of the Internet. We should just say the reason. We're talking about Youtube financials is. Because for the first time ever Google actually said what they were because now that the the boys are gone right yeah okay and and also just because we have similar new information from instagram. No one knew how much money instagram instagram was made. Well that was the timing of that was curious right because you know you google releases. Youtube financials right flex face and then all of a sudden it's like you know if you're insecure disagree like but my business is bigger. I want this no out there in one form or another. I think it was Bloomberg News report and they I think they have great reporters that difficult job but I do think the timing is is very interesting book so Instagram does not share is twenty billion dollars with its content creators. They keep most if there are still some portion of instagram that is similar to you to where they have creators and they pass along a book of the Ad Revenue Against US creators to to those people but for the most part instagram advertising in that works very much like facebook. Blue where it's it's just it's the inbetween space where these ads. Come Out Azer Amarah. I cannot stop clicking. I know my Own area well targeted. It is the only add that anyone is the only add unit online. Anyone talks on one hundred percents Shaw Fai is a multibillion dollar business basically basically on on the back of Instagram ads alone as far as I can make out. It is probably the most well-designed compelling ad unit the the entire AD industry or media industry has designed in decades. And what's fascinating to me is is the when facebook bought instagram. Everyone's like do you think they're going to be able to sell it and it turns out that it's so so much more powerful than Youtube ads so much more powerful than than like Um Standard Online banner ads so much more powerful than anything you see in your facebook feed it is just insane. How how especially luxury brands? Who don't advertise anywhere else online? A flocking to instagram. Because it's the beautiful platform. It's the thing that comes closest to what magazines ones right. In that way. I think a lot of luxury. Advertisers were lamenting just how the Internet was for them and all of a sudden an instagram comes along and it sort of the beautiful life platform basically and so it was tailor made for luxury brands. And you know fancy car commercials that kind of thing so yeah I think in that way it was sort of lightning bottle clips. FACEBOOK is a quarter of facebook's revenue. Right now I believe so I mean one day. Could we see a flip given how powerful powerful. I mean it's interesting. I mean I think they're also starting to a much better job about figuring out ECOMMERCE which I think is obviously something facebook general wants to do on many platforms but I think it makes or more sense on instagram. And and they do have a little bit of a head start. I know that's something that Youtube is also looking at but I think youtube has a much longer to go so I think if you were going to value if you were gonna a youtube versus Instagram I think no question. INSTAGRAM has a much more. Like if if I if I was a you know high end clothing company say an instagram came to me and said we want to do something with ecommerce with you I would. I would take that meeting in a second if you came to me and said I wanNA and do something with echo mess with you. I who go wait no right. I don't want to be next to beheading videos national There is a reason so so this whole youtube question which I like I said for years I suspected it had been losing money and I would anytime I come across the Google source at bugged them. Hey Do you think youtube like what I think it loses money and they sort of like turn their heads and not say anything and eventually like you know enough people sort of hinted that yeah it may not be profitable but there's a good reason why exists. I'm like what's the reason they're like the data right. We're talking about data earlier in terms of Tesla having this network so much of youtube viewing feeds into the algorithms and the and the data processing against advertising against search and their display ad network and so it's a gives them this extra edge otherwise wouldn't so the so the kind of videos goes I watch on YouTube help to determine the Ad Steig served on search and back the other way too right and so it is part of a larger ecosystem that it's it's hard to divorce in a Lotta ways if you really want value so they dominate the maps and maps is the most astonishing product and as far as I can make how revenue from maps is basically zero. I mean it might be tiny tiny tiny. It's a really important part of Google in in in ecosystem because of the data that they know about me because I give them from using Google maps that then feeds into all manner of other revenue streams. They can get somewhere else and also thinking talking about kind of data moving forward. I mean this is a slightly Dodo but I I think from zero to four set. Youtube has a lock on them and in a way that also does I. I have seen personally sell products like astounding to me right. But you're right you're absolutely right and it's just at every stage of of your life. There is something on there for you that it's hard to my daughter's fifteen and she does. She's got homework on occasion. And there's something there's YouTube video explains something and in some form or another everything from the math equations. Cordray to you know what happened to Charlemagne is this just. There's enough on there that there's a huge utility like my three year old nephew. All of the Christmas presents he wanted wanted. He saw youtube videos of kids playing with those Christmas presents or Christmas presents that my wife wants she gets from instagram okay. List of numbers round was in the family. My number is fifteen fifteen percent because that is the broker fee. I spent the first apartment in New York City which I think it was about like twelve hundred dollars back then because my first part was pretty cheap bells all all in but it was really hard to to come up with that twelve hundred dollars a lot of money on top of last month's rent on top of to find. Yeah how does anyone move to New York. I did it actually looking back but the good news is no more brokers fees in New York City. This sort of snuck it on on all of us. That is amazing that they snuck into the bill and that basically the trade group were caught unaware and they came out with with all of these like squeals painting but this is going to really hurt the rental breakfast industry. No one is praying for that. No one is trying and some people say oh but rent might go up. And it's like I always goes up. And second of all is the difference between trying to gather up that broker fee versus just a little bit extra every month but also but also the broken that what they're saying is that the brokers fee is going to be reflected in the Renton that is possibly Lee true but what they're not saying. The brophy is going to come down substantially because wind landlords weren't paying now that they're paying it they go into the price sensitive. Ha Remember. My number is four pounds and fifty pence. So this is he is. Maybe what the cost of the sandwiches that got the city trader firings. I've heard it was a sandwich. Now it may not as I've said head I could be wrong so there was this citigroup trader in London who apparently still possibly a sandwich from a canteen like there's like the cafeteria one one and got fires notions. I think he's suspended. I'm not sure if he's actually fired because they find him before bonuses payable. That's right so from the company the company's making military million or at least a million much. No one knows no one knows. He's an Herash. No I I mean I think there isn't it just the thrill like ultimately these guys they just like when Kendall stole is No no rider. I remember one time in Sun Valley like you know it's this is the big sort of mobile retreat and it was in the coffee shop and you know billionaires are going through there right so one of the billionaires that come in take a paper and walked out and not pay for the name names. Yeah I'll have to think about that So I've got a tricky number. It's a little bit of a cheat. One million that's my number okay. That is a number of subscribers that New York Times netted last year but the Delta that is the Delta okay one million is also the number of subscribers that Disney generated in two weeks again wearing right one million is also the number of subscribers. Netflix netted over ten days. Oh my gosh. Wow so it's a way to think about what we've been talking about earlier. Yeah my number is eighty billion because I leftback numbers. This is the I love number so much. Eighty billion Is the number of sea urchins. That ravaging the Norwegian Kelp forests. There's a bunch of Kelp in Norway and thanks to global warming and various other things. It's not just noise. Roy Wilson California's Wilson Australia basically around the world everywhere you find help there's this horrible invasion of CNN's and they're eighty billions agenda in Norway and it's super harmful for the life in the oceans because these count for support enormous numbers of fish and other things and urgent stuff coming on the Molin. Destroy them which means that. There is a huge opportunity here. New Food Food supply for us all to go completely bat shit bonkers eating earning. Yes that was about to say like when you And I'm like and so people are setting up. Uniforms affirms enlighten away all over the world to try and take these chains and tenement eight something delicious and profitable and good rather than just and then once as you start farming the actions that allows the kelp forests to grow back. So only is the best thing you can eat and we should all be eating. Let's have him with breakfast scrambled eggs it does taste good. Yeah Yeah I'm seeing a lot of blank. Stare on the other side are a bit like he can argument. They don't have a nervous system so if you're the kind of vegetarian who doesn't eat things with an I mean they're living things then. Carrots are living things right. It's all living so the question is where do you draw the line. Yeah okay maybe maybe I need some money four. I'll do it for save the CAL cope. nope okay wow on which note. I think we're going to wrap up slate money this week. Thank you ed Lee for coming in it was amazing to have always always a pleasure being Thank you jeff mean molly for producing. Thank you all listening. Do Stay tuned for the sleep plus about spotify and keep the mill creek sleep money sleep dot com. We will talk to you next week on sleep. Want to hear something. Amazing discover matches all the cash. Back you earn on your credit card at the end of your first year and it's even more amazing because discovers accepted at over ninety five percent of of places in the U._S.. That take credit cards. Learn more at discover dot com slash. Yes two thousand Nineteen Neilson report limitations apply.