I see a large IPO on the horizon.
You're surrounded by journalists. Hold your position.
Overnight success.
The place 3000.
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Right.
Information.
According to clearing order inbound.
Let's just roll.
We are surrounded by journalists. Hold your position.
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Trust the experts here.
Five.
We are founder Mel.
I see multiple journalists on the horizon. Stand by.
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Blaze.
Double blaze.
Triple blades.
Double kill.
Fight.
Is win.
Team deathmatch.
We are experts.
Triple blades.
That's just wrong. Right.
Clearing order inbound.
We are surrounded by journalists. Hold your position.
Strike two.
Activate golden retriever mode.
Market clearing order inbound.
Five.
I see more journalists on the horizon. Stand by.
You're watching TBPN. Today's Tuesday, March 3rd, 2026. We are live from the TBPN Ultra, the Temple of Technology, the fortress of finance, the capital of capital. Let me tell you about Ramp.com. Time is money. Save both. Easy. You use corporate cards, bill pay, accounting, and a whole lot more all in one place. And you know who's going to be a Ramp card? David Ellison, 'cause he owns Warner Brothers now. So, David, if you're listening, just do it. Just onboard to Ramp. We have a fantastic show for you today, folks. Let's pull up the linear lineup because we got...
It's Hollywood day basically on TBPN. We got Matthew Belloni from Puck. He's the founding partner coming on to help us understand David Ellison's mission with Warner Brothers Discovery, Paramount, HBO, CNN, he's got CNBC, CBS, he's got everything now. Then Ken Burns is coming on to talk about his whole career in filmmaking. And of course we have a fantastic...
Explain film. Film for anyone listening that might be like myself.
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Film is the process of capturing images digitally or using celluloid. Do you know about celluloid? This is right. Right. Right. The filmmakers in the back know. So you used to need a specific chemical process. You'd probably be very hands-off on this process, but you used to create a strip of film with the thin clear and you put some chemicals on it and then when light hits it, what does it do? It makes... if a lot of light hits it, it makes it black and then that's the negative and then they flip that around by shining light through it to then expose the final picture and then you get a beautiful movie that you get to watch at the cinema.
Interesting to know how Netflix will change their tune on theaters. So Ted Sarandos has been basically trash talking movie theaters for a long time being like Netflix is the future. Tech is the future. He hasn't been super rude or anything, but he's been like, it's not really key to our strategy. Then as soon as he was in the deal for Warner Brothers, he was like, 'Yeah, the theater's amazing. It's not going anywhere. Like we're excited to invest.' And we will talk to Matt Belloni about how long that lasts until he starts talking trash again. But he's already...
Netflix is up 22%.
Oh yeah. The stock, the shareholders hated the idea. They hated the idea...
loves their enemy to overpay for a handful, a basket of legacy assets. There is another thesis on why Netflix stock has mooned and it's mostly around this concept that Ted Sarandos just stunned in a pair of jeans at the SAG Awards. So look at this. I mean you see this, how can you not want to buy the stock? This is not financial advice, but you see a guy pull up in a fit like that, you're like, 'This is going to moon. I got to get in. I'm going turbo long. I'm top blasting.' You're buying the dip if it's dipping.
Top blasting. You're top blasting and you're buying the dip when you see a man pull up in $2.8 billion jeans because that's the amount of money that Netflix got wired because of this deal. That was the breakup fee. For some reason, I had it in my head that the breakup fee would be the other way, but not too shabby.
In fact, Netflix got paid and Matthew Belloni got a thousand likes on this post. So, my question is, there's a ton of debt going into this deal. Will I be able to watch The Sopranos on Netflix? Will I be able to watch The Dark Knight on Netflix? It's a complicated question because content licensing deals are not one-size-fits-all. They're subject to windowing and certain markets. So, if Netflix has really high penetration in Germany and HBO doesn't, it might make sense to license it there but not elsewhere. But I just want to know broadly, what do we expect from Paramount, Skydance, Warner Brothers Discovery, CBS, CNN, like what is their plan? I think they have Shark Week now, right? In Discovery. They got the Food Network on HGTV. HG, you can watch the Property Brothers.
Maybe on Netflix one day. Who knows? But this is like the most extreme scenario. We talked about a post where someone was like, 'Oh, like you know, masterful 3D chess. They got Netflix to overpay for this and now they're going to be so indebted because the deal got so big that they're just going to have to come to us and license 100% of the catalog on day one.' I don't know if that's true, so I wanted to dig into it. Let's talk about it.
So, just to recap and set the table, David Ellison, who is the chairman and the CEO of Paramount Skydance, agreed to raise his offer for Warner Brothers Discovery to $31 a share. A lot of people, myself somewhat included, thought that Netflix was at least going to counter a little bit, but they folded immediately. And so the co-CEOs, Ted Sarandos and Greg Peters, they didn't counter and they said, 'You got it. Wire us the 2.8B.' And they did.
So the result is that David Ellison is handing over $111 billion in exchange for Warner Brothers, HBO Max, CNN, and the other cable networks. There was this whole political angle in DC about how interested would Trump be in the deal? And apparently as soon as he found out that Netflix was not interested in the cable TV assets, he became less interested in the deal because I think he watches a lot of news, but he probably doesn't watch a lot of Batman reboots and doesn't really care what happens there. And so, you know, it's just like a different thing. It's like, no, you know, he's not turning on the latest DC cinematic universe film and be like, they're taking shots of me. But if he turns on CNN and they're taking shots of him, he's like, I care about that. Right?
So in terms of the financial situation, they're levering up. They took our advice when we started the show. We told everyone rule number one is lever up and they did. So Paramount is already levered. 10 billion in debt.
Yeah. To the gills.
10 billion of net debt. It's like 13 billion, but they have three billion in cash. So 10 billion in net debt, three billion of adjusted EBITDA with which to service that debt. Reasonable but still pretty high leverage, 3x. Paramount will be adding 60 billion of debt. So all combined the company will have something like 70 billion of net debt, 79 billion of total debt with roughly 12 billion of adjusted EBITDA. And so when you're operating north of 6x leverage, that leads to different decision-making, higher discount rates, higher interest rates, it can shift the focus to near-term cash.
So Netflix is a logical counterparty here because it can pay, it has the cash, it has a lot of cash flow to pay for global rights at scale and has a long history of paying top dollar to deploy capital to known franchises. And also Netflix is in a particularly interesting financial position. So, they've been an incredible case study for operating leverage, a true overnight success. Something like 20 years grinding up the subscribers, grinding up the revenue, investing more and more in content.
And if we can pull up the chart, either scrolling down on the tbpn.com newsletter or going to the third post in the timeline, you will see the small bars, the red bars are the revenue and the little dots that have the numbers on them, which you can't really see, show how much they're investing in content. And so for a long time, for something like almost from 2002 to 2018, so 16 years, Netflix was like, we made a hundred million. Let's make a hundred million worth of content. Let's buy $100 million worth of content. And then they were like, wait, we made a billion dollars. You're never going to guess what we're going to spend on content. Exactly $1 billion. And then they were like, okay, we made $10 billion. This is going to shock you, but we're spending $10 billion on content. And so they would just spend exactly what they made on content.
But that changed. That changed in 2019, 2020 COVID, the amount of subscribers spiked, the amount of revenue spiked, then they launched the ad model. Took them a while to figure that out, but eventually worked. And the business kept growing. The top line kept growing, but they ran out of stuff to buy. They ran out of stuff to make. And even though they were paying top dollar for all these different assets, they sort of held their content budget flat, their revenue went up and that's of course operating leverage. So profits to pay for Warner Brothers Discovery assets potentially and so they have the money to spend.
But also they're direct competitors in streaming with Paramount Plus and HBO Max. And so there's a question about how friendly will they be? You know, if you license all the good HBO stuff, people will unsubscribe from HBO.
Yeah. Or Paramount.
Or Paramount. Yeah. Exactly.
It just makes the Paramount subscription offering less competitive.
Totally. Totally. So, it's this delicate balance. There's also potentially, and this was from the president of Fox, there's potentially this idea that regulators might attach a condition to the deal or at least signal or put pressure that the combined entity should maintain its tradition of licensing and selling content.
Yeah, Lachlan yesterday said, this is Fox CEO Lachlan Murdoch, expects that regulators will impose a third-party content licensing condition on Paramount and Warner Brothers Discovery $110 billion merger. He said, 'We wish them the best of luck. We've seen this regardless of whether it was Netflix acquiring Warner Brothers Discovery or Paramount acquiring Warner Brothers Discovery. There will be conditions put on this transaction which would require a producer of that size to continue to sell their content to third-party platforms.' This was yesterday up in SF.
Yeah. So I ballparked it at like maybe 70% chance that in the next two years there's some sort of meaningful content licensing deal between Paramount, Warner Brothers Discovery and Netflix. And so, but I do think that there will be limited windows, some selection in markets where content is available and pretty much everything will be non-exclusive. So if you know some, you know like the original Dark Knight trilogy goes on Netflix, it'll probably still be on HBO, on Paramount Plus. The real key brand assets like the Sopranos and the DC Universe properties, those are much less likely to be licensed. And there's basically no world where Netflix gets the first streaming rights to like tentpoles. You want to maintain those. You want to give the super fans a reason to stay subscribed to begin a subscription on your now two streaming platforms.
There is a lot of potential upside for the Ellison Empire. I think of this like buying a house and then getting a roommate. Like you're levered up. You got a crazy mortgage.
That's such a good example, right? You buy a house, you're living large, but you got a roommate.
Yeah.
And the roommate's Netflix and they're paying the rent to you, you pay the mortgage, and you kind of hate your roommate.
You kind of hate your roommate, but you're long the real estate market. And then as you get promotions, as you get more cash flow, as you get more adjusted, you can pay your mortgage.
And as you pay your mortgage down, you wind up with a really cool asset, which is this nice house that actually has the extra bedroom.
They're like, 'Look, we had a good run. I really love the way you would put dishes in the sink and not do them. I really love the way you would watch movies loud into the night and yell.' But I think it's time for you to move out and I'm going to take the mortgage myself. I'm good for the full bill every month. I'm good.
But there are a lot of similarities, right? Because what are you getting with Warner Brothers? You're getting a whole library of IP that's very valuable potentially for like a hundred years. Porky Pig is from 1935 and I still know this guy's name and I know like I could draw a picture if I needed to. And so if you believe that intellectual property will have a very very long lifespan and it's incredibly valuable, but you have to finance it with debt. You have to work really hard to pay the bills in the short term. You could wind up with a really great asset even if you have that roommate for the short term.
The other interesting question was what does this reveal about the Ellison family's worldview for the future? Because on the one end of the spectrum, you have Larry Ellison who seems incredibly AGI-pilled. He's going crazy into AI data centers. You disagree with this?
Well, I think remember we did like the chart of who's the most AGI versus AGI-pilled.
So he needs AGI but he's not AGI-pilled.
Why is he not AGI-pilled? Oh, just because of his rhetoric and he just doesn't do that many podcasts. Get him on Dries.
Yeah. Yeah.
We'll see what he says. Maybe his timeline's like ASI next month, you know? Who knows?
Yeah, his... You need to sit down your family today.
Is obviously very AGI-pilled.
Does he have a Mac Mini? That's the real question.
Funding data centers is generally aligned with a future where AI is an important technology.
Yeah. Levering up massively, right?
Yes. Levering up.
He believes that AI is going to be big, right?
Yes. Yeah. He believes AI is going to be big. But then he also believes, or you know in concert with David his son, believes that AI will not destroy legacy Hollywood assets. That like no matter how many dollars you have, no matter how much compute you have, no matter how many generations you can use the latest video model, you will not just be able to create a superhero that kids will dress up as at Halloween. And I think that's true. And I believe both of these. You don't...
You're going to be dressing up as Slot Man next Halloween. Slot Man.
You're going to be like, 'Whoa, you don't know this superhero that I prompted myself and no one knows but me. It's a highly... Don't you know the internet's highly personalized now?'
No, but you can dress up as like a superhero who has like these black ears and looks very similar to Batman, but it's not Batman.
Not the non-IP infringing Batman. I think the... Yeah, the... literally describing Slot Man.
Yeah, Slot Man. You're going to dress up as the knockoff Slot Man. I don't think anyone's going to do that. I think Batman's super...
I think broadly media becomes like every piece of media that the audience gets smaller and smaller. Everything becomes more and more personalized.
I like maybe... Yeah, like I think IP still has like a fairly big role in that, but you want to be on the cutting edge. This idea of like Schelling points and like things that like yes, I can have a video that's perfectly tailored to me, but I like talking about movies with Ken Burns. I don't...
They're calling you Temu Batman.
Yeah, Temu Batman over here. Get out of here. Temu Batman. I don't know. But so maybe that's not your worldview, Tyler, but it's clearly the worldview of the Ellison family because they believe in this barbell effect. They believe in the value of...
Yeah. I would... you know another way to look at it is like you could get this hyperpersonalization but it could be around existing IP so you get to watch a personalized version of Batman content that's targeted just for you individually but the kids are still dressing up as Batman.
And we've already seen a glimpse of this with video games. There are video games that leverage existing intellectual property but allow you to customize your character in some way. Put more skill points into intelligence and cast spells versus strength and use a sword, right? Like you can have your own experience if you play... I mean even like the Arkham Batman series, it's pretty linear, but you can play it more aggressively. You can play it more stealthily and you can experience a Batman world that is more stealth focused or more fighting game focused and that allows you to experience something that is unifying and we can discuss. Okay, you played the same game as me. You understand the same character as me, but we had a different experience. And I think AI accelerates that and makes it more valuable, not less. I don't know. I'm somewhat pilled on this, but I respect your differing worldview that you will be enjoying Slot Man.
Enjoy. So by the loosest counts, this is the ninth or tenth time that Warner Brothers has changed hands since it became an independent movie studio in 1923. There's some of those acquisitions that have been like divestitures or reorganizations within other companies. But just like a fascinating thing and I do think that David Ellison is going to go the long distance with this. I think with a little careful financial management and probably a few content licensing deals like this might be the last one. He might be running this organization for his entire career. He's been working in Hollywood since he was a kid and has been very dedicated to this particular industry for a very long time. And so I don't think he's going anywhere. And so get ready for a whole bunch more content. Apparently they're going to make like 30 movies a year which is a dramatic step up. I think that they're going to try and actually ramp up the production.
Are you sure that's not per day?
I would hope so. With AI, it's totally possible. As long as Tyler over there is buying tickets to see Slot Man number 17, Revenge of the Slot Man. I think that there's money to be printed. Let me tell you about...
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And if you are inspired by the whole Netflix, Warner Brothers saga, you should head over to the Goodwill in downtown Brooklyn. Tom from Vanity Fair says for $14.99 you can Zaslav Max. This spring they're selling a nice Port Authority puffer vest from Warner Brothers Discovery. That is a good pickup. Zaslav is a deals guy, Hall of Famer for sure. He was involved in launching CNBC. He also helped create MSNBC, became the CEO of Discovery in 2006. And just a whole bunch of other crazy deals. Love to have him on the show once all this settles down. Like his full career is fascinating and he's been loved, he's been hated, he's been everything in between. Lots of people have opinions, but there's no way to be unhappy if you've been riding with him as a shareholder because he got every penny out of this thing. He certainly did.
According to the Washington Post, there was a researcher skeptical of Havana syndrome. So he tested a secret weapon on himself. In 2024, a Norwegian researcher skeptical that pulsed energy weapons could do damage to human brains built a device and tested it on himself. It didn't go well. So this is crazy. He built it, tested it.
Working in secrecy, working in strict secrecy, a government scientist in Norway built a machine capable of emitting powerful pulses of microwave energy. And in an effort to prove such devices are harmless to humans, in 2024, he tested on himself. He suffered neurological symptoms similar to those of Havana syndrome, the unexplained malady that has struck hundreds of US spies and diplomats around the world.
Yeah, we don't know how to make scientists like this anymore.
This is... glad they're still out there. Extremely bullish for the tinfoil hat industry.
Because I believe that the actual underlying basis for the idea of a tinfoil hat, of course we use it somewhat sarcastically here when we're discussing hypothetical conspiracy theories, but the tinfoil hat is supposed to eliminate microwave radiation and various EMF pulses. And so if you're worried about getting Havana syndrome, maybe pick up an EMF-proof tinfoil hat or maybe just some sort of other... there's probably a better way than just tin foil around a ball cap. But startup idea, startup idea, build a real tinfoil hat that actually protects you from Havana syndrome. That's the real American dynamism startup.
Thomas Maxwell says, 'We have to stop this. I'm not eating a quote Jacob. Eat a Jacob.' I haven't seen this one before. It's 20g of grass-fed protein, no seed oils, nothing artificial, sweetened with organic honey. This definitely resonated. 24,000 people agree. But I think there's Tyler, you should do a taste test of all the different protein bars named after just regular dudes. David bar, the Jacob bar. There's probably more. You got to get on it.
There are a lot of these. The name, I mean Lucy named after a person, it was a whole trend for a while.
It was... Cursor would like a word.
Yeah.
This was great. Incredible.
They came out yesterday. They had heard the FUD on the timeline around Cursor.
They came out yesterday and Bloomberg got some of their data. Their annual revenue topped two billion in February according to a source, a figure that underscores the fast growth of the coding assistant. Sasha summed it up well. He said, 'Cursor sees a timeline turning against them. Quietly give Bloomberg a two-billion-dollar press release. No post from the company or founders. Haters squashed. True comms masterclass.' And Michael Tru actually did come out this morning and says, 'We believe Cursor discovered a novel solution to problem six of the first proof challenge, a set of math research problems that approximate the work of Stanford, MIT, Berkeley. Cursor solution yields stronger results than the official human-written solution. Notably, we use the same harness that we built a browser from scratch a few weeks ago. It ran fully autonomously without nudging or hints for four days. This suggests that our technique for scaling agent coordination might generalize beyond coding.'
So very very cool to see the progress from them and clearly doing something right in the enterprise, right? Just because like everything you see on the timeline is like totally so many enthusiasts.
One of my buddies is Kyle Russell. I worked with him like a decade ago. He's at a company called Valon. And he posted, so Valon, they make SaaS for mortgage services. He says it's very boring. But we're basically getting them all to flip from legacy software and are rate-limited by BizOps people being able to onboard them. So we're going to try instead to think about it in terms of what tokens do we need to extract from the org in order to deploy fast. So he's in this like AI deployment lead role. And he went I think pretty viral saying this morning one person of his team said, 'Hey, can you unsub me from Cursor?' And somebody says, 'Done.' And then a bunch of people said, 'Same, same. Like I don't need it. I'm happy with another program.' And Kyle said, 'Today we announced we're removing 90 Cursor seats because they haven't had any use in two weeks.' And it is like it's flipped from like the most cutting-edge thing to like it's clearly very sticky because you see the ARR numbers that this like ultra-frontier coolest hottest thing is getting some like FUD.
And then Sasha broke this down where he was like the timeline's turning against them. So you have to provide some evidence that like you're not cooked because like the timeline is very much like, 'Oh well, like you're not the hottest thing anymore. You're not the coolest little thing for like the people that are on the most frontier.' And so no, you know, just squashing the haters with a two-billion ARR number, which is fantastic.
Up from 1 billion in Q4, which is just insane.
Yeah. And so yeah, I mean I think like there's just something about the... it goes back to diffusion. We were... I was debating this with Tyler last night about how much of AI adoption is just actually getting the forward-deployed engineer in, actually getting people to change their workflows, onboarding. Like there are certain people that will just bounce from the most frontier thing, 'Oh this model is better, I'm on Codex, I'm on Claude, I'm on Codex, I'm on Claude' back and forth. But for a lot of companies they need a little bit more handholding. And so there's a whole massive chunk of the economy that can be transformed by developing great products and then actually getting them in the hands of businesses.
R for Rock is hearing Cursor maybe in the midst of a new raise at 50 billion to be a meaningful markup from 30 where they were sitting again in Q4.
Yeah. What does DD say? Everyone in the tech-adjacent bubble thinks they are wholesale ditching Cursor but enterprise diffusion is glacial. Most of the world just got a hold of it. It's a good point. It's a very good point.
Well, in some good news, Mark Zuckerberg has purchased a mansion in Miami for $170 million. This was such big news that we had to pull it forward from the mansion section on Friday to talk about today, but there is a little bit of a black pill here. We can go into it. First, let me tell you about Railway. Railway is the all-in-one intelligent cloud provider. Use your favorite agent to deploy web app servers, databases, and mobile while Railway automatically takes care of scaling, monitoring, and security. And let me also tell you about Cisco. Critical infrastructure for the AI era. Unlock seamless real-time experiences and new value with Cisco.
So of course, Mark got this because of California's wealth tax, which if it goes through, he would still be subject to at least a one-time payment, you know, which would get litigated, of course. What we need now is a picture of him in his backyard recreating the Ben Affleck smoking meme.
Wait, why?
Because there's this new national wealth tax that Ro Khanna and Bernie Sanders are pushing. So he's like, he just moved. He just got this new place across the country.
Yeah.
Probably overpaid to a degree.
People are just going to be like, 'Actually, I live in international waters full-time. I don't live in America. I don't live in any country actually. I live in space. I live on the International Space Station or something.' Very very tricky. $170 million sounds staggering. A 5% tax on Mark Zuckerberg's wealth over 11 billion. That should have been his shopping budget because in dude math if you save money you just have a free license to spend it. So you're like, by moving to Florida I'm effectively saving myself 11 billion. I can spend that, right? Isn't that how that works?'
Exactly. Meta chief executive Mark Zuckerberg and his wife Priscilla Chan have paid $170 million for an under-construction mansion on Miami's sought-after Indian Creek Island. The deal closed Monday. The purchase set a record in one of the country's most expensive to date. The current US record is held by billionaire Ken Griffin. He spent $238 million for an apartment. That is a crazy amount of money for an apartment, but I guess it's in a good building.
This is a lot of apartments. The Florida record was set last year when a waterfront compound in Naples traded for 225 million. I feel like this isn't counting Ken Griffin's compound that he's building because he's built... Yeah, 'cause it's multiple properties. He's bought multiple properties.
Okay, here's where it gets crazy, though. The sellers are Dr. Aaron Rollins, a cosmetic surgeon to the stars, and his wife, real estate agent Marine Rollins. The Rollinses paid more than 30 million for the roughly two-acre site in 2020.
Wow. Flip and not real estate agent. Don't want to go up against them. They know what they're doing.
Plans called for a nine-bedroom home measuring about 30,000 square feet with a dock and a swimming pool. Amenities were to include gym, hair salon, and massage room as well as a 1,500-gallon aquarium and library with a secret passageway.
Zuck does need a hair salon in his house 'cause he's always changing his hairstyle. Sometimes he's got the Caesar going, sometimes he's got the fro going. So this is the Gen Z. This is elite for him. Who knows what'll go next? Maybe he'll have long flowing locks like Fabio. That would be the good next move for him, I think. How many gallons is the aquarium?
1,500.
Is that a lot?
That doesn't seem like that much.
What can you put in there? Can you put a shark in there? No way. Some fish.
How big is Keith's? Keith's aquarium is massive in Miami. You can scuba dive in it to clean it up. Anyway, congratulations to the Zuckerbergs on their new property. It looks beautiful. And without further ado, we have our next guest in the Riverside waiting room. Let me tell you about CrowdStrike. Your business is AI. Their business is securing it. CrowdStrike secures AI and stops breaches. And we have Matthew Belloni from Puck. How are you doing?
Well, what's going on?
Doing great. Thanks for having me.
I enjoyed your podcast with Dylan earlier today and I wanted to dig further into the actual merger. I mean, it seems like we're sort of done now. But how has the process of covering this been for you? What were the key turning points? Like what was most exciting for you?
Well, I'm learning a lot. Certainly didn't know what a ticking fee was until covering this deal. Learning a lot about the debt market, learning a lot about the contours of raising money in the Middle East. All sorts of fun things. But yeah, it's been a wild moment in Hollywood for the past five years. Basically, it's a time of tremendous change, tremendous disruption. A lot of people are really scared and don't know what's going to happen. So it's been interesting for sure.
Is that just a combination of like COVID plus streaming plus consolidation plus AI or is there like one story that sticks out to you?
You can throw in a pretty crippling labor strike in the middle of that and it's been one thing after another. About five years ago, the end of the peak TV era, the Netflix correction, where the market decided that Netflix had to make money, streaming subscribers was not the end-all be-all. That created an absolute correction and pretty much I would call it a content recession within Hollywood. And that's trickled down throughout the industry. Fewer jobs, fewer productions. You add that in with the flight of productions overseas, everything from the strike that happened in 2023, which gave these companies an excuse to really re-evaluate the level of production. Throw in the LA fires that disrupted so many different people. And it's, you know, you guys are in LA. It's a really interesting and for many people scary time.
Yeah. Explain the overseas thing because I'm familiar with Atlanta and I believe Toronto. But are productions really moving to other continents now?
Oh, yeah. I mean, the UK has been extremely aggressive. They have for many productions a 40% incentive and they're willing to give you incentives on what's called above-the-line costs. Those are the actor, director, writer. Those are the main talents in the film. That is a huge incentive because it essentially subsidizes you for Tom Cruise's salary, Ryan Gosling's salary, and even in some of the more aggressive US states. You won't get that in California. So you know, it's a game changer when they are doing the line. I just reported on this movie today, Project Hail Mary, an Amazon movie that's coming out in two weeks. The gross budget for that movie is $248 million. The actual net budget is a little under 200.
So you're saving 25% by shooting this movie overseas?
Interesting. And do those come as like tax credits upfront or is it more like a tax deduction on profits where if the movie costs 250 to make and it makes 500 then I'm saving 25% or do I just get the money basically upfront?
It's a rebate. I'm actually not sure. I think it depends on when you actually receive it. But it's a rebate for the qualified spend in the jurisdiction that is giving the incentive. Yeah. So if you are going to get an incentive from the UK, you actually have to have the work done in the UK. And that means hiring local crews. It means using a sound stage in the UK and having the production actually shoot there. And you can have films with multiple incentives from multiple jurisdictions for multiple aspects of the production. Everything from the post-production to visual effects, those can be subject to incentives for doing the work in a particular jurisdiction.
Really quickly, I think we have the wrong mic selected. Would you mind adjusting it? Because I think we're on your laptop mic and I'd love to get that Shure SM7B working because I know it has higher audio quality if you can switch it. And while you look at that, I will tell the audience about Shopify. Shopify is the commerce platform that grows with your business and lets you sell in seconds online, in store, on mobile, on social, on marketplaces, and now with AI agents. Any... how we doing there?
Almost better. You're flipping.
How about... Let's see. Same as... any luck. How about this? Is this...
There we go. There we go. I really...
Wow, you have sound effects. I'm very...
Yes. Yes. Everyone I wish I had an air horn. Some of these are not sound effects on a soundboard. Some of these are real folks in the studio clapping with their hands. We have both. That's true. I can't be trusted with an air horn. Yeah. Yeah. We had a lot of fun.
So talk about the reaction. I know that we talked to Ashlee Vance who's a documentary filmmaker and he was voicing a little bit of worry that if Netflix acquired Warner Brothers Discovery that there would be one less buyer and is this any better for the average filmmaker who wants to go out and get the best price for their product, for the film that they've been working on? Are we still telling the same consolidation narrative or is this somehow structurally a little bit different?
It depends who you talk to, but I would argue that this is actually worse, okay, for creatives because this is the actual smooshing together of two legacy studios. When you talked about Netflix buying Warner Brothers, Netflix is not in the theatrical movie distribution business currently. They do not do movie theaters. So there was a certain class of movie that was going to remain a Warner Brothers movie. Now Netflix makes a lot of movies on its own but those are often smaller. They don't have as much ambition as the big theatrical movies. They do some of those too but that Netflix was at least positioning it as we are going to leave Warner Brothers alone. They also were not in the production business in television for other buyers. Everything that Netflix made was for Netflix. Whereas Warner Brothers makes shows for its own platform HBO Max, but also for Apple and for Netflix and for many other different platforms. So they claim that that would be at least another opportunity for buyers. Here with...
Paramount buying Warner Brothers, this is going to be the combination of two television studios, the combination of two film studios, and ultimately down the line that is going to mean fewer jobs. Now, if you talk to the Paramount people, they say they are committed to making 15 movies for theaters for each Warner Brothers and Paramount. That's 30 movies a year, which would be an escalation for both of those companies. So, they're saying they're going to be more. But the history of the movie business has shown that when two studios merge, ultimately the output is reduced and that trickles down to creators.
What do you think about Netflix's future theatrical plans? Ted Sarandos was talking about the future of movie theaters, painting a more optimistic vision. Do you think any of that sticks?
2.8 billion burning a hole in the pocket.
Yeah, I mean, I don't think Ted is going to use that $2.8 billion to all of a sudden make movies for theaters. Yeah, I just don't think so. I think it's going to be a continuation of their current model, which in many ways is designed to put the theaters out of business. It's designed to give you first-run A-list filmmaker, A-list star movies at home. Even 10 years ago, a movie like The Rip with Matt Damon and Ben Affleck, that would have had a nice robust theatrical run before hitting home video. Not true with Netflix. Now, what Ted is saying is that they have had some constructive stunt experiences with theaters lately. They put K-pop Demon Hunters in theaters. They've done a couple of other things. They did Stranger Things in theaters. And I could see Netflix doing more of that, using theaters essentially as a marketing device for Netflix, but I don't see Ted all of a sudden saying, 'Oh, you know, through this process of looking at Warner Brothers, we have determined that the theatrical model is a good one, and we're going to all of a sudden give our movies a 45-day theatrical window.' Don't think that's happening.
And do you think, how much of that do you think is Netflix just, well, if we have a crown jewel asset, we want people to go subscribe to Netflix and see it there first, versus a lot of times they don't know what's actually going to work, and the beauty of the Netflix model is they can stuff something like K-pop Demon Hunters on there, it can effectively go viral in their algorithm, and they don't need to do the billboard campaign, the theatrical rollout, and take all that risk. So focusing more on like downstream, we got something that's already working. Let's make a musical singalong version or a promotional version for theater.
That is absolutely the benefit, and Sarandos has said multiple times that the best marketing platform for Netflix content is Netflix. Now, I recently had the head of Sony Pictures on the town, and he, I think correctly, said you do not make stars on Netflix. You do not make franchises that last for decades on Netflix. And the way you do that is in movie theaters with a big robust marketing campaign that tells the world about the product. So that even if you don't see the movie, you're at least aware of it, so that when a sequel comes out in four years, maybe you see that one. But if a sequel to a Netflix movie comes out, nobody except the people on Netflix know about it.
Yep.
Yeah. Yeah. I saw Ryan Gosling on the Hail Mary billboard, and I was like, 'Oh, like, we should go see that.' And somebody was like, 'Well, what is it?' And I was like, 'It's a Ryan Gosling movie.' Like, right, what else?
And that's a perfect example. I mean, Amazon had the choice whether to make movies just for Prime Video or to do theaters. They are going big on theaters this year with a full slate of theatrical releases. And they and many others in town believe that the best way to create movie franchises and to create demand is to first put the movie in theater and then debut it on the service.
Yeah, it's interesting. It reminds me of like an apparel brand doing popups specifically, not as like a real revenue driver, but to just deepen relationship with their customers.
Now, don't get me wrong, these traditional studios, they need these movies to make money in theaters. That's their whole business. And the reason you are spending $50 to $100 million on a marketing campaign globally is to generate profitability in theaters. And then you get the waterfall, we call it in Hollywood, the waterfall of revenue that first you go to premium video on demand, then you go to subscription video, then you go to TV, then you go to free TV, then all of a sudden you're syndicating the content all around the world and it's in your library forever. The reason why Warner Brothers is going for $111 billion is not because they had a nice run in theaters last year or because HBO has had some hits lately. It's because they have a 100-year-old library of films that is incredibly valuable to exploit across all platforms and because HBO has an amazing brand.
Yeah. So, talk about content licensing at the new entity, the combined entity. It feels like with 79 billion dollars of debt, cash flow is going to be important in the short term. What's the probability that we're watching Sopranos on Netflix or watching something from the catalog on Netflix in the next couple years?
It's funny because Sopranos has been the one title that Netflix has not gotten.
And HBO has kept that. Not the one, but the one big one that everyone's waiting for. And this debt issue is not new. The Warner Brothers Discovery transaction, putting those two companies together, that created 50-some billion dollars in debt, and they needed to make money fast. And the past three years have largely been about servicing that debt and bringing it down. So, you've seen tons of Warner Brothers shows and movies on Netflix, and they do it because they have to. I mean, at one point, I looked on the Netflix top 10, and six, I believe, of the 10 movies in the top 10 were Warner Brothers titles, and they do it because they need the money. I mean, we know Sony Pictures just did a reup of their Pay One deal. We call it Pay One because it's the first pay platform for subscription viewing of these movies. They got $7 billion out of Netflix over a long period and globally. But that is for the first-run Pay One window for Sony Pictures movies to go to Netflix. Incredibly lucrative. That's what Netflix was buying when they wanted to buy Warner Brothers.
So Sony and Netflix already have this relationship. Is there any chance that Sarandos goes shopping with his 2.8 billion bonus and all the cash flow that he has? He's sort of, you know, kick the tires on one big deal. Is Sony Pictures in play at any point in time?
The Sony Corporation in Japan has said that they are not interested in selling Sony Pictures. It would seem to be the obvious choice because Sony is the one Hollywood studio, the traditional studio, that does not have a general interest streaming platform. They chose not to enter the streaming wars. And that would make it an attractive buy for Netflix because Netflix doesn't need a global streaming service. They already have one. They could pick off the Spider-Man franchise. They could pick off, you know, all the production and distribution capabilities that Sony has for theaters. Would seem to make sense for Netflix, but there has been no indication that Japan is willing to sell.
Yeah. Is any part of the Ellison strategy, does AI kind of factor in at all? I've had this kind of like loose theory that this IP, Warner Brothers IP, could potentially be more valuable as AI gets better because you can create so many different variations on top of that IP. But it's also unique. It's not replicable. That's it. That's it. It's like you have a monopoly on the IP, and if it becomes substantially less expensive to create new film and television, you know, TV shows, movies, etc., maybe the IP is more valuable. But what's your take?
Yeah, I have always thought that one of the reasons why Netflix wanted Warner was because they saw what's going on with YouTube and the volume of content that YouTube is soon going to be able to host and eventually create themselves. And Netflix is saying to themselves, okay, so if anything is possible in streaming and with AI you can create AI-generated shows, music content, movie stars, whatever, what are we doing? What do we have that is defensible here? And they're looking at Warner and they're saying, 'Okay, well, we don't have a Batman. We don't have Harry Potter. We don't have, you know, this hundred-year-old library of known quantities that cannot be replicated by AI, at least not yet. So, we need that.' And Netflix has had a hard time creating franchises. If you can count on one hand the Netflix franchises, the things that they own that are meaningful in the world. Stranger Things they own. Wednesday, they don't own. Amazon actually owns the Addams Family because they bought MGM. There are not that many franchises. You guys probably don't even know what they are.
Yeah. Yeah. That's fascinating. Can you take us on a tour of who is actually involved financially in this deal? You mentioned that it was sort of like a whirlwind tour in the Middle East. A lot of different funds coming in. I imagine that it's some overlap with the tech investors that we typically talk about in this show, but Apollo is in this.
Yeah. I believe Blackstone is. I'm not 100%. There are three big PE firms that are providing a lot of the debt financing here. And then there's an interesting question of whether the Middle East money that was initially floated as being part of this deal is still in there. There was a Saudi fund, there were Qataris, there was one other fund, and they were not in the press release.
Okay. So, I actually need to ask Jerry Cardnali of Redbird whether they are still in this deal. Because Redbird has been kind of the big financial backer and consultant on raising this bid together. And obviously Larry is backstopping the whole thing. We would not be having this conversation about a company with a $15 billion market cap, which is Paramount Skydance, acquiring a company like Warner Discovery in a $111 billion deal if not for the backstopping of Larry Ellison himself.
Yeah. And that was the key factor. He didn't want to personally backstop it. And then once he did, the levers started moving.
Yeah. What is Larry Ellison's history with investments in Hollywood? I know it's not just David that's been involved. He's invested before. Obviously, David has a, you know, almost multi-decade career at this point. What's been Larry's strategy? What can we learn from his past adventures in Hollywood?
It's a good question because people think this is out of nowhere and it's all of a sudden Larry Ellison deciding to dip his toe into Hollywood. Although if you can call over a hundred billion dollars dipping your toe.
She's dipping the big toe.
But Megan Ellison, David's sister, she had a very artistically successful production company called Annaperna, which she still has, but there was a period in the 2010s when she was the dominant producer of so-called arthouse and independently financed auteur-driven movies. And she actually got two Oscar nominations in the same year for herself for Best Picture when she had, I believe it was Her and The Master in the same year. And she's done a ton of movies with big-time auteur-driven filmmakers, and then the wheels came off. She just lost too much money. And Larry basically had an intervention with her and said the money's not coming in anymore. You're done. I'm not doing this anymore. And he had his people step in. They pulled way back. They downscaled the company. And Annaperna still exists. They had a big Sundance movie this year directed by Olivia Wilde and starring Seth Rogen. But they're not doing a whole lot. So, if we learn from this, it's that Larry is happy to indulge his children, but there is a limit on what he's willing to do. And she hit that limit. We'll see what happens with David.
Yeah. Is, sorry, Jordy, you can go if you want.
Just, I'm curious if, I mean, it sounds like Annaperna had a very different financial underwriting strategy in the sense that Warner Brothers is very much like this basket of assets that are so proven. Yes, it's high leverage. Yes, it's expensive. But it's this mortgage on land that if you pay the bills on time, you will get the value of because there's this catalog value that you can license. You can continue to merchandise these assets. So, it feels like a different financial strategy.
Absolutely. I mean, there are not a lot of legacy studios with 100-year-old libraries sitting around. It is a pretty unique asset. Whereas Annaperna was creating its library from the ground up, which is a much more difficult business. The corners of Hollywood are littered with the corpses of companies that try to take on the studios and do this on their own because you have to have that 100-year-old asset to float you when you have bombs because this is a portfolio business in the sense that if you release 20 movies, 10 of them probably not going to make money if you're lucky, and you've got to make a lot of money on the ones that do make money, and those will make money forever.
Yeah. Can you bridge that to A24? We're more familiar with that because there's some tech investors involved. I personally like a lot of the movies, but what is the strategy of A24? How do they fit into the modern Hollywood landscape?
A24 has been incredibly successful on the low-budget model. They are one of the few film studios that have created a brand for themselves. I would argue that the A24 brand is more meaningful to moviegoers than the Warner Brothers brand. I mean, everybody knows what Warner Brothers is, but what does Warner Brothers stand for? What is that brand? You don't really know. And you never had to know because that wasn't a direct-to-consumer business. They put their movies on other branded platforms whether they are theaters or whether they were television or now streaming on HBO Max. But A24 has created a brand. They sell branded candles and hats and things that are meaningful to their fans. But they succeeded on betting small on specific auteur filmmakers and they had a nice run. They also raised a bunch of money as you mentioned and they have recapitalized a couple times now and because they got what I believe it was a $3.5 billion valuation a couple years ago, they have essentially now been forced to go bigger, and they are releasing movies that cost $70 million.
Yeah. The Smashing Machine with The Rock that also cost a lot more than their typical A24 movie.
And they're still buying the small movies at festivals and releasing smaller movies, but they now have more of a portfolio of bigger-budgeted movies. And the jury's out on whether that model is going to be successful for them because again, there are many companies that have had small-level success in Hollywood and when they try to scale up and compete more directly with the traditional studios they've faltered, and we'll see if A24 is able to pull it off. They got really smart people there. So I would hope so.
What is Hollywood actually doing with AI today? Not like what do they want to do, not what are Silicon Valley companies pitching them on doing, but how is it actually being used today?
Well, there's two answers to that question because there's one in the general what is AI doing for all businesses and that is streamlining processes and creating faster workflows. That's all the boring aspect. What you're probably asking about is how is Hollywood using AI to create content instead of in place of a camera.
Exactly. And there it has been much more limited. The toe is in the water and each of these companies has an initiative to incorporate more AI specifically and more and more aggressively in the animation divisions. The goal is to bring down the cost of animated movies significantly and you do that by using AI to automate a lot of different functions and they're being coy about exactly how, but I have heard like the storyboarding process and the physical production of the animated images once the artists have done their work to create the character design and the movements they want. AI can be used to essentially effectuate a shot. And you're seeing more and more of that. Where they're treading a little bit more cautiously is where the traditional labor unions are involved, where actors and directors and writers are involved. You're not seeing studios greenlighting scripts that are written by AI. You're just not. Screenwriters are using AI as a tool that they know of. Sure. But screenwriters are using AI as a tool and they will freely admit that much like they were very happy to use Google when it first came about and they didn't have to have a researcher that would go to a library and tell them what the interior of the FBI looked like. They don't have to do that anymore. And with AI, they can create scenarios or create drafts or create things that will help them. And all that the guilds want is for their members to get paid. So the studios are not allowed to buy a script or greenlight a script without paying a human writer. And that's a big deal. It's the same for actors. You can use AI to accentuate or to do a quick reshoot, but you have to pay the people involved. And we're headed into a new labor negotiation where the studios will try to chip away at that and the guilds are going to try to be more aggressive and make sure that their members are getting paid for any use of AI here.
Mhm. Where do you think AI, what kind of scenes do you think AI will end up coming for first? Is it the stunt, well animation, but then what about stuntmen? I feel like there's a Transformers-level CGI where it's so expensive. Scene, visual effects. Do you think that the dynamic between the studios and the guilds could allow kind of like an entirely alternate kind of industry to form that is sort of broken away from traditional Hollywood norms? Like, you know, you could imagine a group of people in some suburb of LA that aren't a part of the guilds that have never engaged with the unions in any capacity just decide we're going to start making movies ourselves and kind of just ignore the legacy process.
I think that's already happening, right? I mean, you see it, but the difference is, I mean, we all went nuts over that Sora dance video of Brad Pitt and Tom Cruise fighting. But that's because it was Brad Pitt and Tom Cruise. If it was two dudes fighting, nobody would care if it was two AI-generated dudes that did not look like Brad Pitt and Tom Cruise. And that's the power the Hollywood people have.
Yeah. I mean, there's going to be, I think what's going to happen is there is going to be a class system of AI-generated content that will live and have an audience and generate revenue at scale, but it will be perceived as lesser than the more professional and union-supported Hollywood-style work. And I could be wrong about that. It could just bowl over everything. But there's still value in Ryan Gosling's face. And for now, the unions and the Hollywood studios have been able to protect that from AI.
Yeah. Yeah. You can imagine, you know, the luxury houses versus fast fashion, like a similar dynamic playing out where like, yeah, you can get a jacket that functions in the same way as something that Gucci made. Maybe it's the same even material but it costs less and it has obviously much less prestige.
And I think that there will be a middle ground too where the cost of movies is brought down because of advances in AI where things can be done without outsourcing something to five artists to work on at a visual effects company for two months. It could be done in-house for less money with an AI tool. I think that's already happening and there are much lesser guild protections for that aspect of the business.
Post the OpenAI Disney deal, I was expecting to see another deal of a similar shape happen. It hasn't happened yet. Are you hearing rumors? Do you think other studios with big intellectual property and character libraries will take a similar approach?
I think that there are a lot of talks going on. Yeah. And they're trying to figure it out. Disney was in an interesting spot there because that deal with OpenAI was as much about putting pressure on Google to come to the table and to not go rogue as Google has been doing, as it was to do OpenAI.
Also, there was a pre-existing relationship there. Bob Iger, the CEO, he worked for Thrive, which is a big investor in OpenAI. And Disney is, you know, if you're going to go after one company, that's the one to go after because they have the best characters. And if you note about that deal, that deal does not include any voices or any likenesses of real people. Even the Luke Skywalker is the animated Luke Skywalker. So, it's a lot less compelling for people to play around with. If you're playing around with Lightning McQueen or Yoda, and they don't sound like Lightning McQueen or Yoda, it's a lot less compelling than if they did.
Interesting. Yeah, that'll be interesting to see how they roll that out. Maybe that happens down the road. Jordy, anything else? This was great. Thank you so much for taking the time. Great to finally meet. Great to finally meet, any fantastic reporter. And come in in person next time. Yeah, we'd love to have you here in LA. We'll talk to you soon. Listen on the town or you can read me at Puck. Yes. Perfect. Thank you so much for hopping on the show. We will talk to you soon. Goodbye.
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Okay, these are just renders though.
These are renders. This is what they're thinking about because if it was real, I'd be telling Tyler to get a boat immediately.
Tyler was in Arizona over the weekend and sent us a very cool picture of him out at TSMC.
Yeah. Give us a review. Did you feel the power? Did it feel like visiting a raptor?
I mean, yeah, it was like 91 degrees, extremely hot. It was a massive, massive facility. They're still building. Like, there's like, there were two kind of main sections. I couldn't actually tell like what parts they were. There were signs there. There were a bunch of fabs. I think I took a picture next to like Fab 21 or something. Wow. But there's like, there's so much building going on. And it's just like, it's basically north of Phoenix. Yeah. And so there's like a 10-mile radius where it's just like basically just empty land. They're flattening the desert. Whoa. But yeah, very, very cool. Really fun to walk.
Any gift shop?
No, they didn't let us in. There's like a ton of security around at every gate. I wanted to like go in and like take a tour or something.
I want to get a wafer that didn't make it through quality control and get some of the chip CEOs to sign those. I think a Lisa Su signed TSMC wafer would be amazing. Or a Morris Chang signed wafer. That would go pretty hard. I would love that.
Love it.
Moving on. The billionaire tax has gone national. Bernie Sanders is proposing bringing it to the United States broadly at the federal level. Bad news for everyone who migrated to Miami or Florida because it is going to follow you wherever you go. Ro Khanna and Bernie Sanders are proposing a national wealth tax on billionaires going even further than California. They want a 5% unrealized wealth tax to be annual, every year. Every year. That would be, and I've seen some people running the numbers on like, oh, if this tax had been in place since 1999, Jeff Bezos would still be worth 61 billion and he could still afford his $500 million mega yacht. Just like not actually like processing all the negative externalities of something like this. So yeah, I just, I just got into like a PE-backed shell pretty quickly because you lose control, right? Yeah, that or Amazon never even gets the level of investment that it got because of capital flight. I would be so much more sympathetic to Ro Khanna and Bernie Sanders on this if they had like, here's five case studies where wealth taxes worked, and like they can't come up with a single one. And so it just feels like 50% over 10 years, that is a lot. But the implementation of this tax would ultimately create wealth flight, says Chris with Withins. The wealthy are wealthy because they fight to preserve their wealth. So in year one the base is already decimated. Then every single year afterwards the remaining billionaires leave or hide their assets. Meanwhile the markets are all declining all this time because they see that America has been infiltrated by wealth-destroying communists. Chris is not a fan. Bernie, Dave Friedberg has a bunch of good content around this talking about how there's something like 8 trillion of billionaire wealth and 160 to 170 of middle-class wealth. So that is the real prize pool. Yeah. And again, hopefully our lawmakers and voters process how ridiculous this is, find another way, and reject it.
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Clue Investment says her the market is only down 0.08% year to date. Things must be really calm, right?
This is actually crazy. If you asked me where the market was and I hadn't looked, what is this from? What movie is this? Is this AI or something? This is a crazy scene. I really like, this is a good meme template. I haven't used this before. Just RPGs flying around.
All out war.
It is all out war. I mean, a lot of stocks are down like 50%. Other stuff's way up. Things are all over the place and it has been absolute turmoil. A lot of red days in our favorite companies. Is it from Maze Runner?
Oh, maybe Maze Runner. Okay.
GoPro is one of the stocks that is particularly far down. We did a deep dive on GoPro very early in this show's history. They are now at a $150 million market cap. Josh Wolf has a quote here. GoPro's global market share of action cameras dropped to 18% as of September 2025 compared with 84% in 2022 according to Beijing-based consultancy Meritago Services. At the same time, DJI share rose to 66% and Insta360 is up at 13%. So this is going to count Meta Ray-Ban just out-executed on the product side, but cell phones are probably even a bigger factor here, kind of capping the overall TAM. Cell phones at some point just got really durable and the video quality got really good. I remember back in the day skiing or snowboarding, I was a little bit more hesitant to be like, I'm going to take my iPhone out and use it while skiing, and just because it wasn't like waterproof, and then they got waterproof, they got really durable, and most people aren't good enough at what they do to actually warrant needing like a, you know, effectively bulletproof.
The dust collection problem is very real with action cameras. You buy it thinking you're going to be shredding, going downhill, you're going to be surfing, and then you go for a hike once, the video is kind of underwhelming, and then it collects dust. Skiing this weekend, a friend of mine, I didn't see any GoPros among my friend group. One friend of mine was wearing the Meta Ray-Ban Vanguards and enjoyed taking videos and images with those. I've been seeing a lot of Meta Ray-Ban content on Reels. It feels like they're promoting that. They have a little tag and it feels like that's getting a little boost in the algorithm. So, if you're a Reels creator, maybe go pick up a pair and then post some stuff on the algorithm because you might get a little boost. But should Meta buy GoPro for 150? That's like what, one-tenth of an AI researcher and you get a whole suite of products. And I just have no idea if they would get anything through approval. Like it just feels like this is a company that you can't do a zombie acquisition with because you need the assets, you need the IP, you need the supply chain, you need the products, the distribution. You need the whole company. And Meta can't acquire like a VR fitness company without getting disapproved. Granted, it's a different FTC, so who knows? But if you were Mark Zuckerberg and you were trying to get into the action camera market broadly with Meta Ray-Bans, would you buy GoPro for 150?
Absolutely not.
Absolutely.
You partner with Oakley.
Partner with Oakley.
It's a better, it does exactly. It's just the future. Yeah. It's just they made a pair of Oakleys, the action sunglasses, that function just as well as a GoPro for 99% of people. Yeah.
And it's your phone and you can watch Instagram while you're backflipping off of the terrain park. But the crazy thing, GoPro still did somewhere around 670 million of revenue last year. So trading at less than a quarter times revenue. But absolutely brutal out there. Some other people were suggesting like a foundation model lab should acquire the company for like, and that felt like a silly idea.
Doomer says the past looks more like the future than the present does. Let's pull up this. What is this? PM's Phoenix. An expandable van you can build for $2,000.
This is sick. What? What company is this? PMS. What? How old is this? Is this AI-generated or something? This looks incredible. Most companies and most campers and vans these days that are roomy enough to live in are too large for comfortable driving. Conversely, the compact, fun, drivable rigs are usually too small to live in. And no matter what its size, the seller will probably want all the money you have now, plus most of what you'll make in the next five years. This is a good copy. I like that.
So, this was in Popular Mechanics in 1978.
This is a good daily. Someone should pick built on a Volkswagen minibus chassis.
I like that they restyled the front cab as well. Someone's mentioning that the Cybertruck camper back end looks pretty similar. But it still feels odd to take an electric vehicle into the wilderness. I don't know why because it's not like you're bringing a bunch of, it's not like there's a gas station out in the middle of nowhere, but this would give me range anxiety even though I think that's deeply fake at this point.
New model alert.
New model alert. What we got?
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Tyler, you should try to do a speed check. OpenAI also came out this morning with 5.3 Instant.
Okay. Touting increased accuracy.
Is this in ChatGPT? Because I feel like I've had 5.3 in Codex but not in, but not, oh, I got, yeah, I have 5.3 Instant in chatgpt.com now. Interesting.
I do not yet.
Very cool.
And then they're also teasing 5.4. They say 5.4 sooner than you think.
So, let's see. 5.3. It's designed for very, very low latency. It still feels slower than the Cerebras response that I got from 5.3 Spark because I think that the Cerebras chips, although they are faster, they're probably in more limited supply, more relevant to the long-running coding agent models, and so they are still rolling that out. But I'm excited for Cerebras in ChatGPT as a product. And yeah, 5.4 sooner than you think with a capital T.
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Cali partner with Bezel. Oh yeah. To collab allow people to trade price movements of iconic watches. So we can pull up this video here. This basically allows you to trade on the prices of Rolexes for the month of March. Basically is price going to move up or down? So Quaid over at Bezel has been telling us about this one. So you could in theory buy a watch on Bezel and then take out a short position on Kalshi and have a market-neutral Submariner or something, right? Because if the price goes up, you own it's not just any, it's market-neutral stuff. It's market-neutral because if the market crashes, you make money on Kalshi, but you lost money on the watch and you're neutral. So you can hedge yourself now. That's very bizarre. Yeah, I saw somebody pushing back and being like, 'Oh, you can, this is silly. You could just buy the watches and actually trade them,' but obviously it's quite a bit more complicated. Well, you can't sell one that you don't have. Now, you can short watches effectively. True.
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Well, that's going on. Ken, thank you so much for taking the time to join us today. How are you doing?
My pleasure. I'm great. Great to be with you.
I would love to start with the first project you worked on ever because I'm fascinated. Your career has such clarity, but finding a life's work is often the hardest part of going on the type of journey that you've been on. And I'd love to understand who you were as a child, where you found a love for filmmaking, for documentary work, for history, and sort of go through from there.
Well, I was born in tragedy. My mom had cancer almost all of my life and died when I was 11. And a few months later, when I was 12, my dad, who had a pretty strict curfew, would allow me to stay up late at night watching TV shows, even on a school night. And he started to cry at an old movie called Odd Man Out. And right then and there, I'd never seen him cry before, not when my mom was sick, not when she died, and not at the terribly sad funeral. And all of a sudden, I said, I want to be a filmmaker. That meant Hollywood. But I ended up going to Hampshire College in Amherst, Massachusetts, a brand new and experimenting, still there, still experimenting school. And most of the teachers were social documentary, still photographers, and reminded me there is as much drama in what is and was, and all of that sort of combined by age 22 to realize that I had a latent and untrained interest all of my life in American history. And 50 years later I'm still doing the same thing.
How, walk me through your process. Do you have a list? Like has your filmography played out the way you would have predicted a decade ago? How many twists and turns have you run into in your career?
Zero. I mean obviously life throws a lot of stuff at you. I live in rural New Hampshire. That's what I made a decision to leave New York City because I thought that becoming a documentary filmmaker, strike one in American history, strike two on PBS, strike three meant I'd taken a vow of anonymity and poverty. And I moved up here, finished the first film on the Brooklyn Bridge, got nominated for an Academy Award, and everybody said you're coming back. They'd warned me that if I went up there I'd die if I...
stayed, I would die, and I've listened to neither, and it's made all the difference. So I've been able to, working in public broadcasting where I couldn't have made any of the films any place but one foot tentatively in the marketplace, the other very proudly out, that I've been able to have director's cuts for the next 40 films, all of which have been broadcast first on PBS, streamed on PBS. So it's been good. So you might have a 10-year plan with lots of different projects. Sometimes you may, before you've really gotten into something, switch one subject to another. We've been hitting the marks for a pretty long time. The real struggles are within these, and you want to leave the kind of room to experiment, to be thrown a curve, and to figure out how to do it. The recent film on the American Revolution, which now has over 4 billion minutes of watching, the first time PBS ever entered the top 10 of streaming programs at the end of November with what I thought was a ridiculous number, 565 million minutes, is now over 4 billion. So there's some pent-up curiosity about who we are, where we've been, particularly what our origin story is. So it's been a long, interesting thing, but every single one of the films, a director's cut, and that's only possible because I've stayed in public broadcasting.
And in public broadcasting, I imagine we were just talking about some of the changes that are happening in Hollywood and how there's often a pressure to go bigger, and that usually means bigger budgets. Okay, you made a $20 million film, your next one's going to be 70 million. How have you thought about where the business changes, what more money means, what more success, what more confidence means? How has the business side of your work evolved throughout your career?
Well, we've tried not to let the technological tail wag the dog, to pick up one aspect of your excellent question. You know, we waited 10 more years when many of my colleagues had already switched to digital editing around 1990. We waited till 2001. We didn't stop film until 2009 and then switched to digital stuff because we didn't want that tail to wag the dog. At the same time, our model is, you know, an interesting one. It's all grant funded. We don't have investors. So you write a budget, it pays for your salary. There's no profit margin. There's no contingency. And you empty that bucket. The film's either got to be done or you got to be raising more money. So they're very expensive. These are labor-intensive things, particularly when you take, you know, 10 years to do something like the Vietnam War or this American Revolution. And so they're pushing $30 million. At the same time, I raise it all. So I retain that creative control and I relieve PBS of the burden of having to fund more of it than they already do. And so it's a kind of a good situation to be in, and it's really outside of the pressures of the marketplace. So I don't think about increasing budgets. I can go from a $30 million budget to a 10 million, and these budgets are high for my contemporaries, but they don't get to spend. And look, I could have saved myself all the trouble of raising, say, $30 million for the Vietnam series that came out in 2017. 10 and a half years. I spent 10 of those 10 and a half years raising money for it. I could have gone into a streaming service or premium cable and gotten all that money in one pitch, but they wouldn't have given me 10 and a half years. And that's the point. I can't tell the story that I want to tell with the depth and complexity. I mean, that film is now, let's do the math, that is 9 years old, and it is still probably one-stop shopping even among scholarly works to aggregate all of the new scholarship into one place, and nothing's certainly replaced it in film, and nothing that I know has replaced it in scholarship. So we're feeling pretty good about that.
That's great. Has fundraising gotten any easier? Is it just as hard every time? Did you ever kind of hit a moment where you decided to maybe pick up, return the calls from people that wanted to be more traditional financial backers in a particular project?
No, no, because the sacrifice in control is it. So as the films got longer, you know, in the beginning, the first film on the Brooklyn Bridge cost $180,000. I probably made two cents an hour over the five years I did it. So there are more zeros on the other side. So I guess it's proportionally harder. I do have a good reputation and one I wish to maintain. And so we're not looking for compromises or ways to sort of get that cash in hand. You sort of, part of the duty of running the marathon is to run the marathon. And the reward is in not only crossing the finish line, but every single moment along the way, the million steps that you take where one part of you is saying no and another part, maybe a weak voice, is saying yes. And so these are often really complex struggles in which the analogy of a million problems is not an exaggeration. You just can't see a problem as pejorative. You just see it as inevitable friction to be overcome, like picking up that step and making another step.
After the adoption of digital editing, what was the next technological advance that you found useful?
I don't know. I'm going to let... I don't know what I'm doing on your show, but I'm really glad you reduced it to initials because, you know, there's nothing... I mean, people say PBS, nothing could be less, you know, sexy than that. But technology, business, programming, network. I mean, KFC has behind it Kentucky Fried Chicken. You know, I knew all my life, or most of my life, what it was. Now it's KFC, and I got a... this is a really good move. No, I went reluctantly to digital editing because during the 90s, a lot of the interns that would come and work for us, they could see working in analog as some sort of badge. But about halfway through the 90s, I realized these kids want to be race car drivers, and I'm telling them how to shoe a horse. It just doesn't make any sense. And so eventually, almost for them, we switched to digital editing. It's been incredibly interesting. There are still some things, you know, stuff I might tell my editor that I knew would take two weeks now take, you know, two days, and things that took two days take two hours, and things that took two hours now take two minutes. And there's, you think there's salvation in that way, running to daylight there, but there are as many traps, as many places of quicksand. So you just want to be sort of careful about how you approach it.
What is your opinion on digital restoration of archival footage, archival imagery? Technology seems to be advancing there, and yet there's risk.
It's terrific. Yeah, there are a lot of risks. You know, a lot of filmmakers are going back to original film masters. They are taking a digitized thing. And one of the reasons why is that you may have a one and a zero, which is absolute in one way, but as you change the programs, you need to have the machine that did the original thing, and now they're not there. They're in a museum someplace, and you have to go get that thing and figure it out. So I know some filmmakers that are... I can't do it just economy-wise because I've got 250 plus hours of programming, you know, and that's reels and reels. Every half hour is about a reel, you know, of stuff. You can do the math yourself. There's probably, you know, 500 reels in all of this. So it's almost a prohibitive expense. And so you're hoping that your next iteration of masters will be able to read not only the contemporary films that you're working on but the ones you made 20 years ago and updated. But the restoration part of it, to be able to painstakingly do that sort of stuff, has been really terrific.
Can you tell me the story of the Ken Burns effect?
Yeah, sure. It's pretty interesting. I got a call in November of 2002 from a guy claiming to be Steve Jobs, you know, and I went, 'Okay, yeah, right.' And then I realized very quickly it was Steve Jobs. And he said, 'I live in rural New Hampshire.' I said, 'Okay.' He said, 'Would you come and visit me?' And I said, 'Yeah.' So a few weeks later, in early December of 2002, I visited him in Cupertino at Apple headquarters, and he ushered me into a room with two engineers, and he showed me this stuff. And as I said, if I'm a Luddite now, you can imagine what I was like in 2002. You know, I could barely do word processing. And he said, 'So look, we've figured out a way to download or upload, whatever it is, your pictures that you take, and we can do all this.' And they showed it to me, and I was kind of like, okay, a fairly superficial version of what I've tried to do to wake up the past, not just, you know, visually to explore energetically the surface of the photograph you're doing. In a way, the feature filmmaker I used to want to be has a master shot, a long shot, a medium shot, a close, a tilt, a pan, a reveal, insert of details. But here was just a very simple sort of panning, zooming through stuff. You could add it. You press a button and add a music thing. And I said, you know, okay, cool. You know, whatever. And he said, 'Well, you know, next month in January of 2003, every Mac computer from now on will have this.' I said, 'Okay, cool.' And then he said, 'And we want to keep the working title.' And I said, 'What's that?' And he goes, 'The Ken Burns effect.' I said, 'I don't do commercial endorsements.' And he went, 'What?' And the two engineers kind of blanched. I think they were, you know, aware of this Titanic temper, which I never saw, and he came with me. So we go back to his office. We talk for a while, and we end up becoming friends till the rest of his life. And when I was in the valley, I'd stay at his house on the futon above the garage in Palo Alto, and knew his wife and his daughter. We even gave an internship to his daughter Lisa, the famous Lisa, and, you know, it was a terrific friendship. But what I did is I walked out an hour later with about a million dollars' worth of hardware and software, which I turned around and gave to nonprofits. Usually Final Cut Pro to schools that needed it, computers that nonprofits needed. I think a couple fell off the truck because we needed a computer. But 99.9% of it went to a good cause. And I think he was intrigued that somebody in a world in which it was all a one or a zero for him, or somebody would say, 'Okay, I'm going to, you know, you should charge.' And the world tells me, 'Oh, you should have charged him for this.' I said, then he called it the pan and zoom effect. I wasn't interested in having my name on it insofar as it could help other stuff. And it ended up, you know, giving me, and way too short in that regard, a really good friendship with, you know, not arguably one of the five most important people in the United States in the last 150 years.
It's remarkable. What is your process for truth-seeking and understanding history?
So I have in my editing room, and I've had for years and years and years, a lowercase neon sign that says 'it's complicated' in cursive. And that can mean a lot of things. One is when a filmmaker has a scene that's working, you don't want to touch it. But finding out new and destabilizing facts obligates you to do that. It's not true of every place, but it does in our shop. And so I think pursuing truth isn't the question. It's there. You can find out the facts. You just have to wade through a lot of [__] because today everything is just dump truck after dump truck of manure dumped on top of other manure. And it's just hard. It's one of the reasons why, mostly, it's to manage a complex narrative with lots of different balls in the air and hundreds of characters in the case of the American Revolution. Not just the bold-faced names who are, you know, just statues, you know, out in the park collecting pigeon [__] and not real, dimensional, complex human beings. We try to do that, but introduce you to scores of other characters and set a narrative in motion that's at its heart a military one, but is also adorned with very complex political and social and geopolitical and economic sort of factors. And so that takes a while, but also making sure you're right. I mean, we lock the film, meaning we're not going to do any more work on it. We promise. We promise the sound editors, and we unlock it because we found out that word, 16 battleships, deaths, months... we've got a little footnote, and it says two scholars of repute said that, you know, I'm making this up, said that that was right. And then you find out a third scholar who says we're not sure it's 16. So you scour... the narrator's already read and gone home, and you're not going to get him back. So you scour all of the written stuff, you know, hours and hours of stuff, and you find a 'perhaps' and you copy it and you move in front of 'perhaps 16', and then you sleep better, right? Like that's the kind of level of truth-seeking, as you put it. And I don't know any place else that kind of is that concerned about that level of accuracy. But if you add that up a billion times, then all of a sudden you have something, get ready to blow your whistles, that has four billion plus minutes of watching.
It's amazing. Another sound effect. Thank you. Can you help me understand some of the through lines, emotional elements or takeaways, or the fingerprints that you try and leave on your work across projects, not just single ones?
Wonderful. Thank you. That's a very thoughtful question. When I was working, trying to raise money, and I looked like 12 years old, and I was trying to get people to buy the Brooklyn Bridge, yeah, I remember writing a sentence that I was not interested in the mere archaeology of dry dates and facts and events. I was interested in an emotional archaeology. And now I didn't mean sentimentality or nostalgia. That's the enemy of good anything. But I'm looking for that thing that animates art, that animates faith, that animates a lot of the most intimate stuff that we care about. And that's where you say the whole is greater than the sum of the parts, but you never ask yourself what's that difference, where one and one always in your work has to equal two. In my work, you want it to equal three. You want to have that unknown factor. So I guess once when we were working on our jazz series, the trumpeter and composer Wynton Marsalis said, 'Sometimes a thing and the opposite of a thing are true at the same time.' I'll relate it back to the Revolution. George Washington, you know, is the indispensable man. Without him, we don't have a country. Period. Full stop. And in a world in which we're more interested in bottom-up than top-down, it's exhilarating to be able to resurrect somebody. But he's also deeply flawed. He owns hundreds of human beings in his lifetime. And as the writer Rick Atkinson says, you know, you can't square that circle. He is rash on the battlefield, risking his life and therefore the entire cause. He also made some pretty bad tactical mistakes at the largest battle, Long Island, of the war, and then later the same tactic, leaving a flank exposed at Brandywine, which the British take full advantage of. But, and this is the biggest but I know, he's able to hire subordinate talent that's better than him, and he's not threatened by it. He's able to inspire men in the dead of night to fight and to remind them that they're not from New Hampshire or Georgia, but they're a new thing, Americans. He knows how to defer to Congress. He has incredible humility. And more than anything, he just waits it out. He understands he doesn't have to win. He just can't lose. And he does that successfully and defeats the greatest empire on earth. And even more than that, he gives up his power twice. The second, New York, the British leave New York in November of 1783. That is like eight and a half years after Lexington and Concord. He goes to Annapolis where the Congress is meeting and resigns his military commission. He's brought back out of retirement to run the Constitutional Convention and then is unanimously made president, and after two terms he walks away from it. And as rich as George III, the King of England, said, if he did that, then he's truly the greatest character of the age. And so you can have both. And a problem in a binary world, in both computers and media, we want to have a black hat and a white hat. We want to say good or bad. And you can't do that in our own personal lives, and we ought to extend that to our history.
Yeah. The dialectic. I love it. You have been very fortunate in that it feels like there's no project too big for you to undertake. And I'm wondering if there's ever a desire, how you balance going big with a massive story that everyone has at least some conception of versus going back to something like the Brooklyn Bridge and refocusing on something very narrow. Is that something that appeals to you? Do you feel like you've graduated, you've done that, you never want to go back, or is there something, talk about the tension there.
Yeah. Well, that's another excellent question. I mean, within these big, huge, epic series are all the intimacies that were contained in the Brooklyn Bridge. And we do have a kind of exhalation. They're big series. We could just say Civil War, baseball, jazz, World War II, national parks, the Roosevelts, Vietnam, country music, and now American Revolution. But within them are, I think that's fewer than 10 films. There are at least 30-plus films that are shorter than that. And so they experiment more with what you're talking about, that earlier experience. But again, the more important point is that any given minute in a film, say a series, a lot of people would say, okay, you're the director, but you assign a different producer for each of the, in the case of the Revolution, six episodes. We don't do this. We all do work on all of them, and they all are shaped. Same with the editors. They cross episodes, and they do more than one. And so what happens is you have a kind of unity of presentation, but within each scene you have the same kinds of intimacies, the same kinds of small moments that you would find in Brooklyn Bridge. And you're also elevating not just George Washington to a more dynamic and complex and understandable and real, truer version of who he is, but you're introducing people to scores of others that you've never heard of, because I never heard of them. You know, a 10-year-old girl named Betsy Amler who's a refugee. Most of the war, we don't think of Americans as being refugees unless you realize how bloody this was. What a civil war as well as a revolution it was. What a global war. And you're dealing that involves more than two dozen nations, European as well as Native American. And when you say Native American, you don't say them. There are all these nations to our west that are as distinct and separate culturally, economically, diplomatically, militarily as France is from Prussia at that time. And if you think you're going to just make it them and not say French, Prussian, you know, Delaware, Lapi, Cherokee, you've made a huge mistake and left out an important dynamic. Or take half the population, women, and say, 'Yeah, we don't really care about that,' or the 500,000, 20-plus percent of the population that is enslaved or free Black Americans. All of that makes an unbelievable dynamic. And if you add the violence to something that we say is, you know, this sort of bloodless, gallant myth that attends the Revolution, just guys in Philadelphia thinking great thoughts, and they are great thoughts, as great thoughts as ever been thought. But it ain't the whole story. And when you try to integrate that whole story, man, you start to have something that fires on all cylinders. And, you know, that's what wakes me up every single morning of every day.
Yeah. When I think about what has changed in America throughout my life, I go to Apple, I go to technology, I go to business. And your work has focused, you know, you've obviously touched on business, but you focused on politicians and generals and athletes and musicians and artists. And I'm wondering about your perception of the business community, the technologists over the history of America, their interaction with your other subjects, how you want to integrate them into the stories that you tell.
Well, you know, I've done four wars. It seems disproportionate because they're all big, long series, but wars are huge sponsors of technological change. And all you have to do, I made a film on the Second World War called The War, and it ends because of one of the greatest technological changes that you could possibly imagine. Yeah, the Civil War happens because back in the 1700s, an industrialist, Eli Whitney, who will invent the kind of exchangeable parts and the beginning of an assembly line thing, goes down and sees a cousin who's lamenting how long it takes her enslaved people to card a pound of cotton. And he invents the cotton gin, which revitalizes cotton and slavery and set in motion the wheels economically and technologically that will sponsor the Civil War that's upcoming. So it's all the way through that, and we're constantly thinking about and dealing with those changes. And, you know, one of the stuff in my head, full of ideas, you know, if I were given a thousand years to live, which I won't, I won't run out of topics in American history, is invention and technology. And I'd start with Eli Whitney, you know, because there's an underbelly to it. And I'd go to Steve Jobs because there's an underbelly to it. You know, I got kids. I am, you know, we're all addicted to this. And, you know, I mean, my new statement is, and it's such a lackey statement, I apologize in advance for offending your sensibilities, but I say social media isn't social. And artificial intelligence is artificial. They're not social. Ever been in a room of people or a subway car or a block where everybody's on their phone? That is not social. And artificial is artificial.
Yeah. No, that makes a lot of sense. I'm sure you get asked this question all the time, but walk me through some of the advice that you give for aspiring documentarians.
It's really so bad and platitudinous that I'm embarrassed almost to repeat it because there's no laws. And everybody I know that is a working documentary filmmaker, meaning they don't have a side teaching gig, you know, to pay the bills, that are actually making, you know, living, supporting their families, have all come at it at different ways. And so I realized that there's no set career path the way there might be for a feature filmmaker or a doctor or a lawyer. And so what I tell them is, one is Socratic. You got to know yourself, right? Who am I? Film is intensely glamorous for teenagers, and at a college level, the introductory classes are jammed with people, and then all of a sudden next year it's pretty winnowed down. And there ought to be a mechanism within us. This is the Socratic dimension that says, you know what, I don't think I have something to say. I thought this was going to be easier than it actually is. I see how difficult it is. And then the other one has to do with that difficulty, that there's way more talented people than there are possibilities of making a film in this economy, even with the explosion of documentary films now, and some of it quite direct. So obviously some of those people who didn't deserve to get a budget got one. Is that you have to persevere. I mean, I used to keep on my desk two, three-ring binders filled with hundreds of rejections just for that first film on the Brooklyn Bridge, just to remind me, you know, that it doesn't come easy. You know, and that was sitting juxtaposed from a little thing on my door, a quote from a theater impresario in Minneapolis, the Guthrie Theater, named Tyrone Guthrie. He said, 'We're looking for ideas large enough to be afraid of.' Again, not a very good English sentence, but it just means just bite off more than you can chew and learn how to chew. And a lot of that is what I try to impart when people ask me the questions, and I warn them in advance that it's just going to sound like, I'm sure I've just described things that you guys know about what you do, and I'm sure everybody who's listening knows, yeah, those kind of apply to what I do too. And so I think there's basically, in his essay on self-reliance, Emerson says, 'Do whatever inly rejoices.' You need to actually figure out what this thing is that is you, say I, of which there are millions of I's, and which one is the authentic, and how do you proceed to do whatever inly rejoices, as he said.
Is it refreshing to change centuries? Do you think your life would be different? Do you think the projects, the quality might suffer if you had, at some point when you realized that this was going to be the career, you had started linearly and done American Revolution, Civil War, World War II, then Vietnam, and you just go year by year as opposed to bouncing around a little bit?
But yeah, it's not even bouncing around because only in retrospect can you do that, right? Exactly. My best friend was a book salesman, and he, I was sick, and he threw on my bed a paperback, a trade paperback version of David McCullough's The Great Bridge, The Epic Story of the Building of the Bridge. I read it in one gulp. I said, 'We're going to make a film about it.' And then, you know, we're thrashing about what to do, and my future wife and I are driving through Western Massachusetts, and we pass a Shaker Village outside of Pittsfield, Massachusetts with this beautiful round stone barn, slammed on the brakes, and said, 'Who are these people who made these buildings?' That was the second film. Another guy was trying to convince me to do a film on Huey Long, the turbulent Southern demagogue. And someone else said, 'Boy, you know, you did a great film on the Brooklyn Bridge. You know, the Statue of Liberty's 100th birthday is coming up. Why don't you do something on that?' I said, 'Yeah, but I'm not going to make your film.' And so if you give me the money, I'll do it, but I'm not, you know, so Liberty Mutual, you know, insurance before they got the [__] emu, gave me money for the whole thing. And I made a very complex film which also got nominated for an Academy Award. But each one of those first four films come from different things. And so you begin to sort of make choices. So at any given moment, you know, and I didn't think until I was in the middle of Vietnam, not the middle, at the end of it, we were locking it. I was looking at a map we made of the Ia Drang Valley in the Central Highlands, and you could see the positions of the Viet Cong and the NVA and the Americans. And I thought, boy, this could be the British moving west on Long Island towards Brooklyn. And I looked up, I said, 'We're doing the Revolution.' So everything comes that way. And it's much better, you know? It's like, you know, a batter, you know, you just got to read the pitch, and at that given moment it's a fastball, so you're going to hit it this way or hit it to the opposite field, or you're going to try to choke up because he's throwing junk, and you got to figure out how to respond. I mean, it's literally, I'm so glad there's not a plan, you know, or a chronological stuff, and all you can do is take those 40 films and then put them in chronological order, and you know that wastes some.
I just have to pass something along. A lot of people in the chat are saying that they love your work, obviously, but particularly that they became much closer with their fathers through watching your documentaries.
This is true, and mothers too. I mean, particularly with regard to baseball, I don't know how many people come up and said, 'I've seen baseball more than you have.' And I go, 'What are you talking?' They said, 'Well, every single January during the Hot Stove League, my dad and I would watch it.' And my dad just passed away, but my son is old enough. You know, I mean, I've had so many moving things about that, or mothers taking kids to baseball games or going over battlefields. So there's a nice, you know, we talk about how divided we are right now. All you have to do is look at my films and see we're way more divided at other times. And what brings us together are stories. The power of stories neutralizes that dialectic that you were mentioning. Neutralizes this false notion that there is a simplistic binary that we can impose on everything and figure it all out. You can't. And the complexity of us in the end reminds us that there's only us and no them. So I make films about the US, but I also make films about us.
You make the chat also wants us to ask about AI. I already have an idea of your reaction. I appreciate your approach of not letting technology guide the work, but are you at all excited at some point in the future of being able to, you know, recreate a scene from history using image or video generation tools?
Not really. I don't think so. I think every once in a while when you're trying to run down a portrait of Benedict Arnold, who's not a popular person in the United States, so there's no real visual evidence left of him, AI can be helpful in locating that. You know, I use it when I Google a question. I notice how quickly the AI answer comes up. I have to take it with a grain of salt right now. It's not that it's wrong. It's just you may not be offered all the nuances and possibilities. That's going to change and whatever, but not to write a thing or to generate an image. There's a sanctity. I mean, if you say a picture is worth a thousand words, then if you make it up, then what is it? I mean, when everything is permissible, what's true? And I just, I mean, that goes back to your question, you know, what is true? And I think it's really important to at least have, you know, it's like a kid. You remember this when you're young, four or five years old, and your mother or your dad sitting on the bench at the park and you're playing, but every once in a while you got to go and touch home base. I want to be that person.
Yeah. Very cool. You mentioned McCullough, and I'm a fan of Robert Caro.
Yeah, we just interviewed him for a film we're doing on LBJ and the Great Society.
I can imagine. Are you excited about where that genre of historical writing is going right now?
Oh God, yes. I mean, there are so many heavy hitters. I've been out on the road for the last year, a lot of it, with Rick Atkinson, who's two-thirds of the way through his trilogy of the American Revolution. He's the first talking head you see accidentally in our film, but no accident. And the last talking head you see, there's Doris Kearns Goodwin. David McCullough has left us. Stephen Ambrose has left us, but I was just on a podcast with Ari Emanuel and Walter Isaacson yesterday talking about, you know, what the Mount Rushmore that wasn't a president would look like, and then having great arguments with him and his friend Ben Persky, and the four of us, you know, arguing and fighting for now the fastest hour that I've spent. So there's so many good writers. Walter's influenced two of my films. You know, he's one of the biographers of Benjamin Franklin, and he also wrote a biography of our first non-American topic, Leonardo da Vinci.
Yeah. Well, thank you so much for taking the time to come chat with us, Ken. This was very informative and fun.
Yeah, John has done a great job keeping it together, but I think he's definitely one of your biggest fans, and you've come up a lot. Yeah, oftentimes when I can't get a hold of John, she's probably watching, and yeah, we watched so many documentaries together.
Marjorie, thank you for watching. Good job.
Great stuff, Ken. Thank you for joining.
Have a great rest of your day. Goodbye.
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Welcome to the show. Is software dead? First, introduce yourself. Sorry, we'll get there.
Hey guys, I'm a huge fan, longtime fan and listener to you guys, to TBPN. I'm Gokul. I've been an operator and investor for 25 years in the Valley, and yeah, excited to be here with all of you.
So, yeah, it's about time. Long overdue. Yeah, walk us through how you have been processing the SaaS apocalypse, the Catrini article, all the different narratives that have kind of shaken the tech industry both to the upside in many cases and also to the downside in others throughout the start of this year.
Look, I think software is going through a change. I don't think it's dead. Software is still going to be around. In fact, every industry is going to use software at its core. I think what is going to be challenged is companies that are surface-level, where they're going to be light, which are, there's two kinds. One of them are lightweight, seat-based, easy and replaceable. Example I always take, I don't want to pick on them, is Zendesk. Zendesk is customer support software. They sell on the basis of seats and use it for delivering outcomes for customers. The problem with Zendesk is that if I'm a customer of Zendesk, I'm buying 50 seats. I could reduce it to 20 seats and use 30 seats for AI. In the same budget of 30 seats, I can use AI. So I can literally compare Zendesk's performance to AI agents in parallel, and Zendesk won't even know this is happening. So you might be running an A/B test, and you can literally run Zendesk in parallel. And that's a challenge for a company like Zendesk because it's not deeply rooted, part-time, for only part of your employee, part of your customer service request. The other kind of software is stuff that is not outcome-based, that is truly running your company, that's truly running a process. A good example is NetSuite, which is an ERP, which is literally at the core of your general ledger. It's running your accounting. A lot of your business is running off it. You can't really run another version of NetSuite in parallel to NetSuite. You've got to run, and so NetSuite is in a much better position than Zendesk. Now, at the highest level, the reality is every piece of software has to reinvent itself over the next, but the time frame, it's much more urgent for Zendesk to do that in the next 6 to 12 months, while something like NetSuite probably has 3 to 5 years to think about it. So if I were NetSuite, what I would do, I would create AI agents, which I'm sure they're already doing, and I would, as they say, commoditize my complement. I basically make it free to actually have a bunch of interesting workflows which are offered through AI, and I would basically still charge for the data. Very, very different.
How did you process them? There's a whole new class of AI-native ERPs that have come online and raised over the last one to two years. How did you process them? There's certainly like a long graveyard of startups as well. But part of the challenge is there's just so much software to build with a system like that. And maybe now is the right time given that we can create software a lot faster than we could historically.
Right. I know many of those companies. I think they are great entrepreneurs. I think the challenge for them is that there is no pressing, burning reason for somebody using a NetSuite, I should say, to rip and replace NetSuite. So what you have to do is you have to go with a company that doesn't have an ERP today and get them to start using you as a software company, as a vendor, and then grow with them. And so I think that's a strategy: build your customer base from net-new companies which don't have an ERP today. I think going to somebody who's using a large ERP and saying, well, throw out your ERP and replace it with me, is hard. So you've got to either come up with a very, very, very narrow wedge where you can inject yourself in and then use it to over time take on NetSuite, but more interestingly, I think, go after younger, fast-growing startups which will need a NetSuite or an ERP system in a few months, offer it to them for free. Some of them actually, some of these ERPs have been saying, if you're funded by one of these VCs, you can use the first tier of my product for free. Sure. And that's a smart idea because you use it for free, you're not going to generate much revenue, but in exchange they become sticky, and when you actually start generating revenue a year from now, they're there for you.
