There's some, like, stories you couldn't tell before when this, Sydney Sweeney. Genes. Genes, fractious happened. You know, the idea on social media was that it was like people on the left were outraged, the libs are outraged, and we actually used AI to prove that it was first a construction of the right. So, you know, it's there's all kinds of interesting things.
Hello, and welcome to another episode of the Odd Lots podcast. I'm Joe Weisenthal and I'm Tracy Alloway. Tracy, I think I've mentioned the story once or twice on the podcast. If Pete thinks as I get older, you know, repeat the lore, the repeat the lore, you know, there are new listeners who haven't heard of it. In 2009, when I was in a Business Insider, my first sort of real journalism job, I got a call from someone I don't remember who it was, but someone asked me there like, oh, would you be interested in coming in and for an interview at, dealbook. Just, you know, part of the New York Times. And at the time and at the time, I was just like, what? Why would I want to board the Titanic? You know, the stock was at $6 a share, old print media. I was like part of the internet, etc. I was like, no, I didn't. I was like, no, why would I want to do that? I like I'm part of a new thing, you know?
I mean, I think this is a very old traditional media versus new media divide because around that time, I guess I would have been at the F.T. already and the New York Times kind of looms very large in print media, to put it mildly. So there are two things that I, when I think about that moment that really stand out and how different we are 17 years later, or something like that one is. The New York Times was certainly not the Titanic, and it's done extraordinarily well since then. You know, can't do almost can't overstate how much, it's reversed. But there's something else which I think is interesting, which is that maybe at the time, those of us sort of doing independent media, etc., like maybe it's like, oh, the goal is to reach like a brand like The New York Times. Whereas these days one of the things that arises is people who are at big, platforms and publications like the New York Times might look and see how lucrative independent media is and be tempted to like, oh, do I need, do I need the label? Do I need the platform anymore? There's so I could make a ton of money on Substack or something like that.
Lots of spin outs of, journalists going independent?
Yeah. For sure. The other thing I was thinking of is just the melding of digital and print media, right. Because it feels like both sides look a lot more like each other than they used to. So you have the old school print publications that have gone big on digital, including, you know, games, video, podcasts, all that good stuff. A lot of the independent writers and bloggers are now known for producing like, very high content, high quality content and journalism. So it's kind of like everyone's come together.
Yeah, this is a big fusion anyway, to understand contemporary media business, we have to understand the New York Times clearly. Just like a huge winner. There's melding of all different kinds of businesses under what at one point was, quote, a newspaper. I'm just excited for the media navel gazing.
That's right. We love that. Anyway, I'm very excited to say we do, in fact, have the perfect guest. We're going to be speaking with Meredith Kopit Levien. She is the president and CEO of The New York Times just reported earnings yesterday. Meredith, thank you so much for coming on Odd Lots.
I'm delighted to be here. Fan of the show. New fan, but fan of the show. Yeah.
Thank you. Love to hear it. What is the what is the New York Times if someone you know because at one point someone would have said, oh, it's the newspaper. What is what is your if someone says to you, what is the New York Times? What is it?
I think The New York Times is the essential service for curious people everywhere who want to understand and engage more deeply with and enjoy the world.
When you first took on the CEO position, what would you have described as your biggest challenge at a place like The New York Times? Because again, you know, Joe and I have come of age in the journalism business during a very turbulent time when all we heard was death of the media, death of the media, death of the media, most of what many of us are still alive.
What a fun question. So I've been, I've been in this job CEO for six years, but I was the chief operating officer of, let's call it, 3 or 4 years before that. And then I had a, a couple of commercial jobs at the times before that. And I would say as I was coming into the role of CEO, we were beginning to get to the point where it felt like the really hard arc of digital transformation, was like we were doing that. We we had done that and we were finding success with it. And I would say, like this, this really hard period of playing defense, you know, how do we, deal with the fact that we've got a newspaper business, a print business that's declining rapidly? And how do we get to enough scale in our digital business to, to make up for, what we're losing in digital? So that's like, around my own transition of role, we were beginning to transition from kind of playing defense to to thinking more ambitiously about what is all that The New York Times can be and do as a force for value creation, for its users, for society, for investors. So I to me like the my own transition, kind of came at a time where we were beginning to say, how do we think even more ambitiously about it? And then I'll just, say that in all the time that I've been there. So I've been there 13 years. And this is true, I came from two other media companies. So I spent the better part of my career working in and around journalism and media. The big lesson I've learned is that how and how much you can grow your media business is like, first and always, a question of how and how much you can grow the engaged audience for your work, grow it, sustain it, grow it more, find the next group of people. And so I would say I regarded the job coming into it as how do we find that next tranche of growth, of engagement for, for our work?
Yeah. I remember when I was a business insider, you know, obviously a lot of our, you know, we get a lot more a lot of traffic from Google News, a lot of traffic from Facebook. And I remember, like even thinking about the time I was like, that's great. Clicks are great, but that's not your that's not a real audience if they're not coming to you directly. But I want to ask one more sort of like big picture question, because I think that might inform some of the more specific questions we ask. But okay, so now The New York Times is a news publication, but it's also a games developer. You've purchased games, you've developed in-house games. It's obviously a major food media recipe brand. What is the through line here, such that all of these different things fit under a brand called The New York Times?
Yeah, we, do high quality independent news journalism and make them market leading lifestyle products that are so good that they are, to your point, worthy of being sought out by name. Come to directly formed a habit with I'm sure there's about habituated to you and that that can happen at real scale because the world is filled with curious people who want uncompromised information. They want, to engage with media that is trustworthy and true and worthwhile, you know, worthy of their time. And I think that's what our broad brand promises.
I'm always so curious. People always mention games, and often they mention recipes. You did not mention sports if I was listening.
Yeah, closely. We're four year. Yeah. Four years into owning The Athletic, I was going to say this was the first year, there was some athletic content that was popping up in my feed. I don't have an upgraded New York Times subscription. I do have a sub. I'm so sorry. I don't have the upgraded, but we're going to have to unpack what that means. This was the first time. Well, I do want to talk to you about price elasticity of use, but yeah, this was the first time I ever felt that I was missing out on sports content as a sort of non-sports consumer. But, you know, the World Cup was going on, and I kept seeing the Athletic pushing out these really good stories. And I was like, I need to read this. Yeah. But so, we'll have to talk about you upgrading to the bundle. We have experienced all of the New York Times, but I think to a large degree, you're asking me what's like the brand promise that cuts across all of it? It's that we are going to bring you high quality, independent, trustworthy information, and we're going to present it to you in a way that is elegant, in many cases, enjoyable, that makes good use of your time. And that's going to add understanding to your life. That's going to make you smarter, that's going to make you more well-rounded person. And in the case of our lifestyle products, Athletic is a good example of this. It what are we doing for The Athletic? We're helping you be a better fan. Like enjoy your fandom more. You know, I'm a sad and sorry New York Jets fan. Like I read The Athletic, I watch The Athletic. I listen to it so that I understand what is happening with this team I care so deeply about. And we're going to do that in every dimension of the times.
So I mean, the bundle has clearly been a big factor in the subs expansion in the success of the overall company. And then at the same time, you have emphasized over and over again that the foundation is high quality content, it's high quality journalism and information for curious people. I'm really curious, as the CEO of the company, how do you evaluate between making, for instance, a star journalist, higher investing in the journalism versus buying a new game that everyone is going to be addicted to, or starting some new vertical that has the potential to be very interesting?
Yeah, so many, so many good questions in there. We let me let me start by saying, the sort of core of the brand promise. The most important thing for us to get right is we're going to help you understand the world, and we're going to do that in a way that is in service to nobody's interest. But the public. And one of the most important reasons, the most important reason, the New York Times has had all the success, whatever success it's had over the last number of years, is because the first dollar in the place goes to the high quality, independent news journalism, period. Hard stop. And I think there's like an idea in the world. And this idea has been around for a long time that, sort of hard core independent news journalism, particularly about serious topics, is like a loss leader. You do it because you have to do it. You do it for the mission. But in fact, an organization like The New York Times, like The New York Times, makes its money from games or sports or I want to put that to bed. It's just like, not true at all. The, we are going to cover the world, at the judgment of our editors in a way that gets people the most important information they need to know. I think most people are not aware or thinking on a regular basis about the fact that there are brutal, multiyear civil wars in Myanmar and Sudan. Most people do not know, how and why Ebola is spreading differently in the in the DRC right now than in the previous Ebola epidemic. It is our job to tell you that we're not telling you that, because we think those stories are going to get more clicks or more video views. To your point, and we're going to cover it whether we think it's going to get all the attention it needs or not, but the promise, the broad promise when someone buys a subscription to the New York Times is, we're going to do that. We're not just going to give you what you think you already want. We're also going to direct your attention to things that matter that you may not know you're interested in. Yeah. So I just I want, I want to say where do we invest? How do we allocate our capital, how do we think about resource at the company? The most economically value creating thing we do, kind of writ large is high quality independent news journalism. Now, make no mistake, we want to be or already are the unequivocal market leader in every other space we play into. So, you know, we want The Athletic to be the single best place you can experience sports journalism. If you are a fan of any team, really, we cover and we cover most of them, right? And we want our puzzles. I think we've already achieved this and we want to achieve it even more to be, the best sort of collection of high quality games that a smart person would play that make you smarter every day. I think we've achieved that and we intend to keep growing that.
So I understand that. But how does that actually factor into resource decisions, resource allocation? Because, you know, all media companies are in some sense resource constrained. You have to decide, am I going to get like a digital editor who's really good at social? Am I going to get a reporter? Am I going to get a new game designer? Yeah.
And all of that. One of the things that makes the model of the times work so well is who gets to decide how many people we have on the ground in Ukraine. I think we had 70 last year in and out. So five years into a grinding war, the editor gets to decide. The journalists get to decide often that actually happens below the level of executive editor. It's the international editor, and it's the people even closer to what is happening in Ukraine, in Russia. So my job is to make sure the company is economically successful enough that no journalistic leader has to say, can we afford to send Declan Walsh, who's an incredible multimedia journalists in in DRC? I don't know if he's there today, but he's been there very recently. It's very expensive to send someone into the Ebola zone, you know, as safely as possible. My job is to make sure that no editorial leader who is saying, we need to cover this because the public needs to know, it has to say, but that feels really expensive or, you know, this war has been going on for many years. People already know enough about it. My job is to see that we are economically viable enough that nobody ever has to say that it's not just viable, but successful. Right?
Let's look, talent and journalists, accumulation for a second. There have been some notable departures from the New York Times. Ross Douthat, a star columnist, is going over to 60 minutes. The co-hosts of Hard Fork are leaving. One of the things with a lot of like, you know, sort of traditional news organizations for one thing, even before digital, the skills, for example, between a sort of typical newspaper and just even TV are really weird and they're really wide. And so you could have a great columnist who's making a fraction of like, what a, you know, a CNBC anchor makes or something like that. And now you have this new thing where people like the infrastructure to build out many individual newsrooms is very easy. Click of a button, have your own little newsroom on Substack or something like that. What do, how do you think about essentially making the case to existing capital T talent? I hate that word, but it's the word people in media use, to either stay at the New York Times or to come to the New York Times in the first place.
Yeah. Let me start by saying, first of all, Ross Douthat is awesome. I love to show he's been a columnist times for a long time, loved his show. I think I've listened to most of the episodes. Kevin Roose, tech reporter. Awesome. I wish those guys well. I think they'll be successful and I look forward to seeing it. We have the largest collection of journalists we've ever had in our history by miles and miles and miles. And even if you don't count The Athletic in our Wirecutter newsroom, largest collection we've had in our history, there are like a thousand more journalists in the New York Times newsroom today than when I got there 13 years ago. And the most talented. And there are a lot of stars. We love having stars. We want to make stars. We want to nurture stars. And we want them to do their best, best work. I think the times has a model, maybe different from others model that goes something like this. The best journalists in their career at the top of their game, coming to do the best work of their careers, supported by the best editors, the best partners. If you ask Jonathan Swan, who just co-wrote a book, Big Book, with Maggie Haberman, about the first year of the second Trump administration, if you ask him why it came, he said, he will tell you he came to the times because he wanted to work with the other best journalists there was covering the white House. If you ask Ezra Klein what makes his work so good at the times, he will, he will give a lot of credit, in part to Aaron Reddick, his editors, and an incredible support system around them. Lawyers, security people, people who will help stand up for your work when you're covering difficult topics and others don't want that information to get out. And the best graphics people, the best photographers, people who will make that help you make the work that you make the best it can possibly be. And then what's the other differentiator at the times for a really, really big audience? I, I can tell you that when somebody comes in from the outside to the times, even if they're well known to begin with, the thing I always hear from them is, wow, it's different to publish a story in the New York Times, in whatever format, in terms of audience. I think our proposition is about people who are, really talented people who are obsessed with both the name on the front of the jersey and the one on the back of the jersey. And like, understand the benefit of both. I'm not sure that's for everybody. I accept the fact that it's not for everybody. Our model always evolves at the margins in anything we're doing because the world evolves. But I think the core thing I've just described, will endure. I think it will endure. And unequivocally, you know, we we're making a very big push and ambitious push into video. Yeah, unequivocally. We want to have the best journalistic talent on earth, and we're going to do what it takes to have them. I'm going to say one other thing, which I think does not get a lot of play. I get asked all the time, you know, will you will you have a television construct? Right. Pay? We have stars. We nurture them. They're doing great at the times. And we also have the 70 people on the ground in Ukraine who I referenced. And we also have people in Sudan and Myanmar and, you know, some of their names, you know, write some of their names you don't know. And the the ability for the model of the New York Times, I run the business, the ability for the model to accommodate all of that, in an enduring and sustainable way is incredibly important. But make no mistake, we want to be the place the best journalists come and stay.
I do want to ask you more questions about video, because that's of interest to us as well. But and we are on video. Yes. We're on. Yes, yes, everyone's doing video if it's a video. But just on the sort of independent journalists idea, do you find yourself sourcing more again, talent? I'm doing air quotes on a podcast, but hopefully people on video can see me do them, from independent platforms or from social media itself. So for instance, TikTok, Twitter slash X, maybe sub stacks, things like that in a way that you weren't doing, say, 10 or 20 years ago.
Meaning when somebody is hired into one of our newsrooms, I, I, let me answer the question. In the, you know, in a way that reflects what I know to be the case, we are going out and looking for the best work and the best people behind the best work. And right now and again, I'll say I'm very proud of the fact. And I think it's quite important to our economic success that we've hired so many news journalists, news and opinion journalists over the last decade plus, we are looking for best work and we are looking for people who, are able to and want to do that work in an independent way, following, a set of really rigorous professional standards, where that presents is in any number of places. I will say it's not been my experience as a media consumer that you're seeing a ton of kind of journalistic work, outside of the journalistic organizations. Not saying there's nothing there. But so I would say we are looking for where we find the best stuff and the people doing it in a manner that we think they can, really thrive at the New York Times. And that's to a very rigorous journalistic standard, and particularly a rigorous standard for independence.
I have two questions on video. One is very short and Alaskan. First, you have some great reporter, senior reporter. They do this big investigative thing. They've been at the times for a long time, and then they're like, and now you're going to hold a little microphone and you're going to talk into a little iPhone and explain this in 90s for an Instagram Reels person, they do they like that or they like, come on, like I'm a serious journalist. You're making me hold this little degrading microphone in front of me. What's that like? Yes.
I mean, I will just say it. First of all, the quality of those videos is very high. Okay? Not everyone is perfect that word, but the quality is high. I'll make sure you and I. And here I have been here 13 years, and I can tell you moments where it felt like we were pushing to do something new or to change, or newsroom leadership was pushing in. That felt like there was a lot of resistance. This is not that moment. This is a moment where I think people are so excited that the times is leaning in, in a really robust way to a new format. What does that new format do for us? We put you on camera. You get to explain how you got your story. That is fundamentally interest producing. It is trust building. We get to show the independence of the process. Why you got that information in an uncompromised way. Often now you'll see a journalists like almost holding the receipts of the information. They they have. That is also good for showing what is the core act of journalism. It's reporting. It's professionally trained people going out into the world and unearthing new information. The more we can show that, the more people are interested, the more the public understands. What is independent journalism. Why does it matter?
One of the question so the stock over all New York Times is done very well, but I believe the last two quarters, including yesterday's earnings announcement, is sold off a bit after earnings. And there is this anxiety about essentially I think, you know, video production is costly. And this is now, you know, 5 or 10 years ago everyone was talking about pivot to video then and that sort of fizzled out, etc. it fizzled out because it was a naked attempt to go get ad dollars on Facebook. And and this is about can you build an audience of millions of people to come watch in addition to reading, if you walk through a little bit more of that video ROI and how it works?
Yeah. Let me, let me first address, your, your sort of push on, where, you know, valuation of the company in any given moment. I often think I have the best job in media. Certainly the best we've I, I'm we can argue after the show, but I because this is a company that public company but it's a family controlled public company. Why does that control structure exist? Two reasons. One, keep the journalism independent and in service to nobody's interest, not even our own commercial interest. And two, it allows us to play long game. And what does every CEO really want to do? You want to make big, bold, ambitious bets that you can get consumers at real scale to do something, and then you want to give those things time to play out. And I want to tell you what I've learned in my own career is making great things, takes it, takes time, and it takes resource and investment. And, you know, we don't we we are building a larger and more profitable company with every sort of passing quarter at the New York Times. And I believe strongly we will continue to do that with more subscribers and more revenue and more profit. And all of that is a virtuous circle to getting to do it, you know, delivering on our public mission better and better. But we have the benefit of taking a long view of our strategy, and therefore we give it the investment, we give it the resources, we give it the time to play out. And I think to your point, I think you said in your intro the stock was $6 when someone asked you to come to Dealbook. What a shame that you didn't come. That team is killing it, continues to kill it. And Ross Sorkin is the best. But you know, all the value creation we've done is from making a handful of really considered, really ambitious bets about how to have the widest possible engaged audience for all of our work. And that takes time, and it takes investment. And I am so confident and comfortable that there, you know, others may have an anxious moment. Our work is to have a really clear, ambitious vision for where we're going, for how we serve the American public, the global public, with our journalism and our amazing lifestyle products. And I am, confident to my core that we have, great potential to do economic value creation as we do that, as long as we stick to our strategy and see it really clearly.
But I think to Joe's point, like the original pivot to video seemed to be very much we didn't really make right away, but in general it seemed to be very much advertiser driven. It was a cynical play to get advertisers in the in the moment when the video ad market was exploding, and now everyone talks about it as more consumer engagement reader or watcher engagement and all of that. And I personally do not understand it. Yeah. Okay. So I watch videos on YouTube. I do it mostly because the platform is convenient, but I'm not actually watching them for the most part. Most podcasts I still listen to audio only. I do not watch any podcasts. What is your take on why consumers actually value video, as opposed to written or audible news?
That is such a good question. And let me, let me first say it has been our experience, even in the kind of printed digital transition and the web to mobile transition and even into audio. And we've got a monster success in audio, right, with the daily and a number of other podcasts, all of which are video shows now, except except the daily dailies still monster monster success. If you it has been our experience that the the old format does not go away. If you listen, you're going to listen. I'm a runner. I listen more than I watch to most things. I listen to a lot actually listen to automated voice of our articles most mornings while I'm running so that I'm caught up on what's on the the home page of the times. I would regard this effort in video, at least at the times, as following a belief. And I think there's just like clear evidence that it's there, that there is there's a huge amount of people who read and listen, and we're getting a lot of those people, by the way, still running room left there. But but we, we have, we are doing really well with a lot of those people. And then there's a giant audience, people who watch and they watch. What do they watch? Some watch news. A lot of them are watching entertainment that has some current affairs bent to it or is adjacent to news. I actually think a lot of what you're referring to on TikTok or YouTube or Instagram is, is that and we see an enormous opportunity to feed that audiences interest a new audience for us. Right? I this is not a replacement behavior for reading and listening. This is the times making a big moves into a market that we play in only in a nascent way today, and to serve that market and honestly, to answer to a white space that is there for really high quality journalistic content and reported content. And I think there's sort of two sides to it. There's still a lot of people, they may be older, but who watch the news on television still a lot of people, and there is a giant number of people who are either passively scrolling video platforms and getting kind of news adjacent stuff, or they're going to YouTube and they're watching long stuff, and we see the huge opportunity to take share in both of those places, and we're really early at it. But that that's what we're what what it is. I listen, I ran our commercial business the when the pivot to video happened, that was a cynical attempt to get ad dollars without regard to the thing I said at the very beginning, which is, can you get millions of people to engage with the thing? We want to do things at a scale of millions of people engaging with it every day. And I see that opportunity in video when we talk about video or even when we talk about games or when we talk about recipes, and then of course, core news, you know, okay, there's this great New York Times brand.
But I also and I think, you know, I associate the brand with the sort of, like you said, word curious, pretty relatively educated, liberal minded and so forth. And I'm curious, like how you think of all of these things with one of the big risks for all media, which is to some extent audience capture.
And people worry about, like, okay, you have this audience and there's two risks that arise. One is you might have the good reporting might involve things that offend the audience, etc., or people might just seek out media that's even more satisfying to them ideologically or personally. Then it's like the New York Times is insufficiently speaking to, like, my niche interest. Obviously, this is an editorial question, but it's also a business and long-term question. It's a, how do you think long-term about, like, the size of and durability of an audience that might, you know, want to be spoken to in specific ways?
I love that question. And let me first say, how do we think of our audience? Curious. They are educated, open-minded. And what is our job? Open-minded is a little safer. Open-minded, yeah. And you know, if you look at the total audience of the New York Times, it reflects that the sort of, who is there reflects the population at large, much more than your, you know, liberal comment would suggest. We are going to pursue the truth wherever it leads, even when, and this is often the case, it leads to very uncomfortable places that people do not want to know. And I think you only need to, like, stand on the street in front of our office on days where we're being protested, sometimes in different ways by opposing groups, both of whom think we exist to, you know, defy their cause. That's nonsense. It's not, when you've angered both sides, that's how you know our job. I could give you so many stories and anecdotes where the conventional wisdom is that this thing happened, and in fact, something else happened which is much more difficult for the public to grapple with. And we're going to tell it that way when we have the evidence that that's what happened. You know what? That pisses people off. And we're not there to please.
We are there to give people understanding about the most important things happening in the world. And that is just like paramount. And I love your words, audience capture. We're just not doing that. To the extent that that assumes some compromise in that pursuit of truth, that is not what we do. We do not chase audiences. We want a giant audience. We want a giant, engaged audience. But we're going to win them. Because I actually think most people want information, particularly in this environment where there's so much slop and disinformation, or you just don't know where something came from. And is it true at all? People want to know the thing that I'm getting is true. They want to know that a fair process was pursued to get that truth. They'd like to see the receipts of that process. That is what we're doing. And I want to say, what we were doing in news very broadly defines a big, big space. That is what we were doing in sports for fans. That is what we are doing in shopping advice. You know, Wirecutter, our product review site, I'm sure there are lots of ways we could make money beyond producing high-quality independent reviews. That's not captured either. We're going to, if the mattress everybody thinks is better or cooler isn't the one that our testers say is most comfortable, we're going to say the truth about that, too, even if that other mattress company is the big advertiser. That's the promise we believe. And I think we have shown for a long time now that promise is value-creating for society, and it is economically value-creating. Period.
We should talk about, yeah, yeah, for sure. So media organizations, it seems like as soon as we kind of started getting through the digital transformation, here's AI, a new problem to solve. And media organizations so far are approaching it in very different ways. So I know you've done a licensing deal with Amazon. Meanwhile, there are other organizations, perhaps the one we're sitting in, that have said they don't want to do licensing agreements, they want usage-based fees and that sort of thing. In your mind, what is the ideal compensation setup for journalism when it comes to LLMs?
Let me say a couple things about that. First, we spent like close to $2 billion last year producing half a million works of content, stories, photos, videos, expressive, creative work that required enormous resource to go make and human beings to go make. And we've been doing some version of that for 175 years. So we have a giant corpus of stuff. We know that stuff is incredibly valuable to society, to anyone who might use it, including the LLMs you mentioned. We've done a deal. We have also sued three companies, we're suing, we're two and a half years, maybe almost three now in to suing OpenAI and Microsoft. Three. We sued Perplexity last December. And we've done a deal. And what is all that about? That is about standing up to the idea that these companies have stolen our stuff. They've used it without our permission or any kind of control, and they've built products that can compete with us. And there are multiple ways to take care of that problem. One is to enforce our rights in court. Another, highly related to your point, is to do deals. So what do good deals look like in our mind? They can be continuous with a strategy to have a sustainable and growing business for a publisher or anybody producing high-quality information. One, two, they give us, we give permission, very clear permission to use our work and then have control in all the uses, all the ways that it might be used. And then third, and obviously, there is sustainable, fair value exchange for the use of that work. And the Times is very open to dealing when we can find those terms. I think the stakes are really, really high here, and I just want to say this does not get talked about enough. These companies, the LLMs, are spending, you know, tens of billions of dollars, sometimes hundreds of billions of dollars on talent, on compute, on power. They should be spending the money that is sufficient value exchange for what they are getting from what they call data, which is high-quality, independent journalism and other kinds of creative work.
There's a different AI-related question, but I've been very curious speaking to every executive. How are you thinking about the New York Times' own, I guess I would say, token consumption? Allocating access to models for, I'm obviously, there's, I'm sure the developers are all using, yeah, Claude Code or Codex or whatever. Has token spend gotten to the point where you think about, okay, 2027, what are we investing in? Like, is it up to that level yet where it's like sort of in your circle, you have to think about token spend?
Let me say, it's a great question. And every CEO I know, I'm also on another public company board, everyone is talking about this. Everybody is wondering how everybody else, we keep saying it's about to be the standard question for executives, in the way that you ask about, like, workers. I think it's like a second question. And as you would imagine, we've rolled out coding tools to a huge swath of people in product development at the Times and marketing at the Times. We actually have a big AI initiatives team in our newsroom that's building really cool stuff. I can talk about some of that too. It would be amiss not to talk about that. But the way we think about it today, first is what's the work that should be human-led? And I want to say, high-quality, independent journalism, human-led, human-led creative stuff. We're a creative company. We make stuff that is, like, best by humans, for humans. Doesn't mean AI isn't going to help us do a bunch of things better, more efficiently, more productively. But human-led in the creative work. So I just want to say that. And so for us, I think everyone, I think anybody who's saying otherwise probably doesn't really know yet. I think we're all in a period of seeing what can the tools do. And, you know, we've got close to a thousand people doing digital product development at the New York Times, you know, 3,000 journalists and people making content, the journalists and making content group, if you ask me. My guess is that keeps growing, right? As long as we keep succeeding as a company, that keeps growing. And I think it's going to be some time before the tools themselves, given all the evaluations and the human judgment, I think it's going to be some time before anybody is going to give you a really credible answer to that question, honestly.
Fair enough. Okay. What are you doing with AI?
A bunch of things. So, can I just give you examples? The Epstein files dropped on a Friday night, and I think it was like 3 million pages of documents. And we obviously have all these reporters who had all these queries and questions and sort of ideas of what would be important for the public to know from those files. Our AI initiatives team built a toolset to use and come and look for patterns and clusters, and our production of high-quality journalism, human-led, high-quality journalism, from being able to use the tools to comb and look for patterns and see what was in the trove was just awesome. The next week, like, awesome, we were able to get to information in a much faster way. We were able to tell different kinds of stories. Amazing. So that's a use of AI. And we've got a whole team in the newsroom that's looking at where are the best uses. I think huge troves of public information. So, you know, this is an old example, but when Trump was coming back into office and appointing cabinet members, we would be able to use AI to, like, look at their full public record in a much more efficient way. And then there's some, like, stories you couldn't tell before. When this Sydney Sweeney jeans fracas happened, you know, the idea on social media was that it was, like, people on the left were outraged, the libs are outraged, and we actually used AI to prove that it was first a construction of the right. So, you know, there's all kinds of interesting things you can do. My favorite example is we were trying to convey this new trend in sport, and we used AI to sort through all this existing aerial imagery of tennis courts. Do you know what I'm going to say next? How many of them were converted to pickleball courts, to use for investigative journalism. But, like, I'm just giving you a range of things. And to make the work more accessible, AI automated voice translation, we had an early experiment in translation. The tech will get better. I see real opportunity when the tech gets better.
My old boss, Henry Blodget, past guest on this show, pointed out on this show that historically, at newspapers, there might have frequently been a division between reporters and writers. Someone calls in, yes, what did it say? Just the idea of a reporter out in the field calling and typing in some data and having an AI generate it automatically, does that offend you as a possible workflow, rather than someone on the call writing?
Rather than tell you what offends me, let me tell you what I think the act is. Okay? I think the act of a reporter, and by the way, the foundation of journalism is reporting, reporting, reporting. What is reporting? It is going out into the world and following a professional process to, in a fair way, unearth new information. It is talking to people. It is going to the scene where awful things are happening or good things, important things are happening, and then with sensitivity and judgment, translating that into what does the consumer get on the other side, the reader, the listener, or the watcher? Understanding. That process requires sensitivity. I think all the time about, like, the horror of school shootings or, you know, these things need to be, all of this, especially difficult things, need to be translated with kind of sensitivity and judgment and care about the humans that you're writing about for the humans who are taking it. And so it lands with impact. I think much of that process is human. Now, am I offended by the idea that there are a bunch of things that tech, including generative AI, can do so that we can have more reporting? I'm not offended by that idea at all. Not at all. And the Times is where it is, because we're really comfortable that technology is going to help the company have bigger audience, do things, you know, do things to make the work better if it's used responsibly.
Can we talk about price elasticity?
Yeah. Such a good question. I'm going to spare you the anecdote of my niece asking me to share my New York Times password. I said, do you know what I do for a living? I think the most important thing to say on that is one of the reasons the Times has all the subscribers we do is we never accepted that we had to choose between having a lot of stuff widely available so that people could sample our work, and also enough value and gravity in the product so that people would pay. And I just, I don't think that gets said enough. We were early at that. There is so much New York Times today, yesterday, tomorrow that you can take in if you do not pay us, so much good work and real gravity in the paid experience. And we've been very careful for, you know, I've been working on this more than a decade, to always be kind of calibrating between those two things and never letting the balance tip so much that you are not planting the seeds for the next million subscribers and the million after that and the million after that. And we've been keenly aware for the better part of a decade that the direction of travel from the platforms will be that we should be getting more and more of it into our own control. And we've done a lot of that, is also part of why the Times has succeeded.
As to price, I'm going to say a very basic thing, which is, we have a pricing strategy that I'm going to use now, business jargon, because you said I could, that's meant to get everybody under the demand curve. We think there's a huge market in news and in every one of our lifestyle products, huge market. We are still early in penetrating that market in news and in every one of our lifestyle products. And so our pricing strategy is meant to get everybody under the demand curve. And I'll say on one side, it's like international subscriber buying our games product on sale or international prospect coming to pay for games on sale, all the way up to someone who has bought a family plan bundle and going to share it, you know, with their whole family. There's a lot of room in between there. Our hero product, the best thing we can do is get you to buy our news and games bundle, because that has the most value in it. And every, at every pass, every opportunity we've had to get people to find more value and then pay more has gone well. And that is because we have relentlessly made the product more and more valuable. And one of the reasons I believe we will keep growing value for shareholders is because our products are literally just inherently every one of them is getting more valuable every day. And so what does that look like in brass tacks? You can, you know, most people buy our news games bundle, which is the whole thing, at a dollar a week. And then over time they engage. And then over time they reach a pricing step-up point and they come to a much higher price because they have experienced so much value, and they're able to do it. And that has all gone really, really well.
