Thursday, May 16, 2019

“Food Delivery Boom Means Sandwiches Don't Come From Restaurants Now - Bloomberg” plus 4 more

“Food Delivery Boom Means Sandwiches Don't Come From Restaurants Now - Bloomberg” plus 4 more

Food Delivery Boom Means Sandwiches Don't Come From Restaurants Now - Bloomberg

Posted: 15 May 2019 02:00 AM PDT

[unable to retrieve full-text content]Food Delivery Boom Means Sandwiches Don't Come From Restaurants Now  Bloomberg

These shared-space restaurants are fast and low cost, but failures have piled up in the new business model that's still like the Wild West.

Can Your Company Benefit From Hiring Remote Workers? - The Advocate

Posted: 16 May 2019 12:28 PM PDT

The buzz around remote working is growing (and here to stay), as companies seek to gain a competitive advantage when it comes to hiring and retaining the best talent. In this economy, hiring top-notch employees has become increasingly more difficult and job-seekers themselves are more conscious of their need to establish a better work-life balance.

Related: 17 Things You Need to Know About Remote Work

Yet even with that said, remote working is not for everybody. So how can your company decide whether, and how, a remote workforce could be beneficial?

Companies that are making remote workforces work

One of the first examples of a company doing the right thing when it comes to remote working is GitHub. Github has over 60 percent of its workforce working remotely, and this balance has been a big success, the company's senior product designer, Joel Califa, wrote in a blog post. The secret, he said, is finding the formula and balance that work best for each workforce.

Creating a successful remote team requires a unique structure and training process that is best to implement from the start. Your remote workforce can actually improve your organization if you learn to recognize what remote workers can do for you that on-site teams cannot.

GitHub, for example, hires people who are outcome-focused and have high emotional intelligence. These workers are more than happy to go out of their way to make thinks easier on one other and take chances in order to get the job done.

One of the key characteristics of GitHub employees is that they are more cognizant of their strengths and weaknesses, Califa claimed.

If your company, too, has a remote team like this, you can build a collaborative team, with relationships that focus less on who's making decisions and more on being productive and efficient when it comes to work output. The key is identifying employees who are collaborative, humble and kind and can share responsibilities and work together for the collective good.

Related: The Secret to Retaining Productive Remote Workers Is Remembering They Are People

Joel Gascoigne, founder of remote working pioneer, Buffer, would likely agree. In a blog post, Gascoigne wrote that the the biggest benefit of remote work is the flexible schedule it allows. It's the idea, he said, that your employees can swap time spent commuting for walking the dogs, or go for a run during the day or meet with friends and make doctor's appointments -- without taking time off.

These freedoms lead to happy employees who are willing and able to work harder, as they are less stressed, Gascoigne wrote. Talent retention is also a big plus, as there are many people in today's workforce who wouldn't stay in the role they are in because they want more travel in their lives, or require more flexibility for their  particular lifestyle.

Remote working offers this and more.

Zapier is yet another example of a company that has perfected the remote working set-up. The company actually issued what it calls the Ulimate Guide for Remote Work to help others establish a remote team or remote workforce.

The interesting part for most employers and employees (in my opinion) is how to build company culture when you are not face-to-face. The biggest takeaway here is that business leaders should establish a culture based on how they (as a company) work. So, establishing work hours, setting up communication channels and using online tools can all help build culture.

Finally, tech security company CrowdStrike is a prime example of an organizxation that has fully embraced remote working practices. Named as a great place to work by Fortune, CrowdStrike employs 800 people, of whom 400 work remotely.

Among the challenges here for the company are developing a consistent hiring framework to get the best talent, regardless of location; working on fostering the right culture; making meetings better ;and focusing on accountability. The upshot is that CrowdStrike can equip its staff with what they need wherever they're based.

How-to suggestions

A modern and progressive employer will always be open to letting employees work remotely, especially for computer-reliant jobs. Employees like to feel valued and trusted, so having the emote work option can prompt loyalty and improve productivity. In summary:

When hiring a remote workforce, focus on finding the best talent and especially look for people who have worked as freelancers or with startups.

Give employees freedom -- focus on results, balance and sustained productivity.

Experiment, share and learn from others to develop your own remote working culture. That way, you can better identify the people you want to work in your company.

Encourage people to work while they travel. Having people in different time zones can actually be beneficial for your business as work never stops. You effectively have a 24-hour workplace.

Clearly outline the best practices. Establish clear goals, objectives and outputs as well as open and intentional communications to foster inclusivity and teamwork.

Recognize that you can save a lot of money on office space and facilities, but also consider the costs associated with working remotely, such as home internet fees, coworking memberships etc. The majority of remote workers currently pay for these themselves, but as the industry evolves, employers will have to think about how to support their workforce with these costs.

Related: 6 Characteristics of Successful Remote Employees

Utilize online tech to make work run smoothly. There are a number of tools that remote teams need to utilize to be functional. These range from chat tools like Zoom for video-conferencing to Gmail and Google Sheets for shared email and spreadsheets. Other tools to consider are Slack, Discourse, Zenefits, Monday, Dropbox, Dropbox Paper and Trello.

Can Your Company Benefit From Hiring Remote Workers?
18 Ways for Digital Nomads to Make Money
5 Ways Entrepreneurs Can Leverage Remote Teams

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The Zacks Analyst Blog Highlights: Beyond Meat, Restaurant Brands, McDonald's and Kroger - Yahoo Finance

Posted: 16 May 2019 07:13 AM PDT

The Zacks Analyst Blog Highlights: Beyond Meat, Restaurant Brands, McDonald's and Kroger

For Immediate Release

Chicago, IL –May 16, 2019 – announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Beyond Meat Inc. BYND, Restaurant Brands International Inc. QSR, McDonald's Corp. MCD and The Kroger Co. KR.

Here are highlights from Wednesday's Analyst Blog:

Meatless Burgers Selling Like Hotcakes: Fad or Budding Trend?

With increasing health awareness and public campaigns regarding the adverse effects of processed red meat, consumers are gradually shunning meat-based products for meatless alternatives. The silent yet pronounced shift in dietary preferences has brought to the fore evolving business models from quick service restaurants and startup firms as demand has far outstripped the supply.

As items like meatless burgers are selling like hotcakes, it appears that the trend is here to stay and a vegan revolution is likely to sweep the culinary tastes of the Americans.

What's Driving the Trend?

Alarming rise in average global temperatures due to adverse climate change has hampered the eco-diversity of several places, risking human wellbeing. Various studies have revealed that beef generates about 41% of livestock greenhouse gas emissions – the largest among livestock. This has led to mass awareness campaigns by environmental activists to preserve natural resources, improve human health and animal welfare by reducing red meat consumption. In 2015, the World Health Organization also pitched in and linked the consumption of processed meat to cancer, branding red meat as a likely carcinogen.

This encouraged firms like Beyond Meat Inc. and start-ups like Impossible Foods to come up with plant-based protein products that are similar to the taste and appearance of meat. The innovative products instantly caught the fancy of consumers with a distinct appeal to their taste buds, and have witnessed exponential growth in the past couple of years.

Growing Market Penetration

Impossible Foods initially partnered with some restaurants to serve the meatless, plant-based burger patty and gradually increased the tally to 7,000 as its products grew immensely popular. In order to cater to the huge demand, the firm increased its production facility with added employee base and even raised $300 million through celebrity funding from Jay-Z, Katy Perry, Serena Williams among others to fuel its growth engine. Impossible Foods has so far generated $750 million to run its business and aims to further extend its operations to bridge the demand-supply imbalance.

Burger King, the second largest burger chain in the United State owned by Restaurant Brands International Inc., is the latest to partner with this start-up, when it announced that it will offer a vegetarian version of its flagship sandwich using a patty from Impossible Foods. Named the Impossible Whopper, this delicacy will be offered in Burger King's 7,300 joints across the country. This is likely to further amplify the demand and put the industry on fast track to growth. On its part, Burger King aims to increase footfall to its restaurants by offering the meatless version of its signature burger.  
McDonald's Corp. also seems to be eager to join the fray as it started selling a meatless version of its burger in its German restaurants last month. Known as the Big Vegan TS, the company is likely to analyze the response to this item before taking a final call to introduce it in the United States.

Road Ahead

With increased publicity, supermarkets like The Kroger Co. are mulling to start selling these items through their retail stores this year. That the culinary trend is here to stay is further corroborated by Beyond Meat, a leading competitor of Impossible Foods, which went public last month with $25 IPO price and is currently trading at $79.68 as of May 14, 2019. Beyond Meat has reportedly improved its supply chain and even ramped up production to match the increased demand.

Dewey Warner, a research analyst at Euromonitor International, rightly summarized, "There's a lot of flash-in-the-pan, fast-growing things in the food industry. But growth in the plant-based meat alternative space is accelerating, indicating that this is more than just a fad. This may have some staying power."

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How To Start A Business On A Budget - Forbes

Posted: 09 May 2019 03:00 AM PDT

It is possible to finance a great business idea on a shoestring budget.


When you hear the word "startup," it's easy to envision the hottest up and coming companies in Silicon Valley vying to snag financing from venture capital firms. However, not all startups require millions of dollars in funding to get off the ground. In fact, according to the Small Business Administration (SBA), many micro-businesses can get started for as little as $3,000 or less. These businesses are often home-based sole proprietorships that require low, upfront investments. Another option is a franchise. While the average franchise may require a more substantial investment, home-based franchises can be started with as little as $1,000-$5,000. If you have a great business idea, but you're wondering how to finance it on a shoestring budget, here are some tips to keep in mind.

Start small

In the early stages, don't invest too much up front if you don't have to. It may be tempting to spend thousands of dollars on a beautiful new website or logo, but the reality is that as time goes on, you will need to make adjustments along the way. Keep your overhead, inventory, and labor expenses low. Make every dollar count and ask yourself this question before you are about to spend any cash, "Will this help me acquire new customers and contribute to my bottom line?" If the activity doesn't help you grow your business, skip it. Also, test your idea to ensure that you do indeed have a market for it. Create focus groups consisting of your target audience and find out what their needs and pain points are. You can also take advantage of online survey tools like SurveyMonkey to solicit feedback. Cynthia McCahon, founder and CEO of business plan software company Enloop, says that,

the best approach is to test your idea in a small, inexpensive way that gives you a good indication of whether customers need your product and how much they're willing to pay for it. If the test seems successful, then you can start planning your business based on what you learned."

Keep it simple

When you incorporate your company, keep it simple. A limited liability corporation (LLC) can be formed in most states for less than $100 online without legal assistance. This will keep financial and legal liabilities away from your personal assets and is less complex than a C-Corp or an S-Corp. You can even use sites like LegalZoom or IncFile to help streamline the incorporation process. Writing a business plan can be daunting, so start with a one-page document (also sometimes called a Lean Business Plan). This will allow you to save time and it's an easy document to share and get feedback from business partners, friends and family. You can even use this simplified template to build multiple business plans as you try out different ideas. Consider working out of your home to avoid renting office space. You also don't need an accountant right away—an accounting package like QuickBooks will do just fine. If you do need outside help, consider freelancers and virtual assistants rather than full-time employees. In terms of marketing, look for cost-effective ways to promote your business online using social media and don't hire outside experts until you are generating revenue.

Be scrappy

If you are bootstrapping your business, it's unlikely you will have a big marketing budget. This is the time to leverage your personal and professional networks to get the word out. Be creative. Use social platforms like Twitter, Facebook, LinkedIn, Instagram and others to the fullest. Reach out to your contacts to see if anyone would be interested in pre-ordering your product. This will give you some valuable initial feedback around pricing and potential demand. Find creative ways to score media coverage. One idea is to sign up with Help a Reporter Out, or HARO, as it is typically referred to. This free platform connects journalists to industry experts and will allow you to present yourself to reporters, bloggers and others as a reliable and responsive source. Create a blog. Blogging is a powerful strategy that can help your company generate valuable exposure. One study found that businesses with blogs generate 126% more leads than their competitors without blogs. A blog can help you position your startup as a thought leader while also attracting organic search traffic to your site. Email marketing is still the most cost-effective way to promote your product or service. Once you collect a prospect's email address on your website, you will be able to nurture them over time with valuable content.

Starting a business with minimal financing is challenging, but it can be done. There is not a direct correlation between the amount of money you start with and the chances of your business succeeding . In fact, sometimes having too much starting capital is worse because it gives the early appearance of success and leads to wasteful business practices. By starting lean, you'll maintain a more disciplined approach as your business grows. The habits you learn while bootstrapping your business will serve you well as you take your company to the next level.

Eugene Wei on Apple vs. Netflix in original video programming -

Posted: 16 May 2019 03:20 AM PDT

Netflix is spending billions every year to produce new movies and TV shows for its subscribers. So it follows that AT&T-owned HBO can compete by spending just as much, right? Not exactly, says Remains of the Day writer Eugene Wei.

"[Netflix] got the high ground [online], and it's very rare in history to see any company successfully take on a company with a scale advantage by actually just copying what they do," Wei said on the latest episode of Recode Media with Peter Kafka. "The fact is the whole definition of scale advantage is that Netflix has 100 and whatever, 50 million subscribers, and you don't. If they want to spend $10 billion on content, and you say, 'I'm going to spend $10 billion on content,' they're spreading that cost across a lot more people."

Boiled down: If you want to really compete with Netflix, you're going to need to outspend them, by a lot.

Seemingly every major media company is launching its own fragmented wannabe-Netflix killer, but Wei said only one company has a chance, and it's not really playing that game: Apple. Although the tech giant has announced a slate of (expensive) original programming from creators like Oprah Winfrey and Steven Spielberg, it's seemingly not racing to burn through its cash pile and overtake Netflix's years-long lead.

"The current Apple offering, as I saw it from their keynote, looks a little bit like kind of like, 'Me too, we have a service,'" Wei said. "'We have a lot of phones and things in people's hands, and so if we tack this on, it's probably going to do pretty well.' Kind of like Apple Music did pretty well, right, just through the distribution. It's not going to be a service predicated on being revolutionary and dominating the video streaming industry."

You can listen to Recode Media wherever you get your podcasts — including Apple Podcasts, Spotify, Google Podcasts, Pocket Casts, and Overcast.

Below, we've shared a lightly edited full transcript of Peter's conversation with Eugene.

Peter Kafka: This is Recode Media with Peter Kafka, that is me, I'm part of the Vox Media Podcast Network here at Vox Media Headquarters in New York City. It's a gray, gloomy kind of cold day, but I'm warm on the inside because Eugene Wei is here, a Recode Media all-time favorite guest. Welcome back, Eugene.

Eugene Wei: Thank you, thanks for having me.

I'm loading you up with pressure here because you were great last year.

I appreciate it.

I called you a thinkfluencer, and I think you said you'd not heard of that term, I hope that's now on your Linkedin.

I should add that.

We had you on and you talked about everything under the sun, sort of riffing off some of these great blog posts you do, we'll do some of that today, but I just want to get people up to speed. Last summer you came through, you have worked at Hulu, and Amazon, and Facebook, and when you came through last summer I said, "What are you doing?" You said, "Oh, nothing really." So now what are you doing?

Yeah, well, I'm still sort of doing nothing specific.

You look pretty relaxed for not doing anything.

I am relaxed, I am relaxed. It turns out that not doing anything specific is good for that.

You've got what looks like a very fancy, expensive, retro-y camera back there, so I see that's a thing you're doing?

Everyone indulges their photography hobby at one point. I've done a little bit of this and that, I've been advising various companies, I've been meeting with a lot of different folks and trying to figure out what's next.

So you're not in a rush?

I'm not necessarily like under a specific time deadline.

And we talked about this before, but to me you are one ... and there's a handful of people like you who have really sort of, I don't know, there are some people who knew who you were, and that you wrote, and you wrote this really intelligent stuff, and just based on this sheer sort of intellectual firepower you brought to these posts, which you can read for free on the internet, you sort of created a whole new persona and, I assume, professional life for yourself?

To some extent, I mean certainly I think it didn't start like that. I've had my website for almost 20 years now, no one really ...

Remains of the Day, if you google Eugene Wei, W-E-I, it'll come right up.

No one really read it in the beginning, it was like three coworkers reading it.

But this is all in like the last couple years, right? You started writing this brainy stuff and people started sharing it on Twitter, and then I assume people — we talked about this — are coming to you and asking for advice or maybe asking you to consult.

Mm-hmm, yeah, like I think it turns out that ... Well, two things: Initially, I was writing on Amazon because I felt like whereas Apple had a lot of people writing about it all the time, not that many people wrote about Amazon.

And also you are an early Amazon employee.


There aren't a lot of Amazon employees who talk about what it was like to work at Amazon and things you learn there, so that alone made you interesting.

Right, and then the tech world in general loves navel-gazing, so if you write ... Just like the same way media loves to talk about media, tech likes to talk about tech.

How about a tech media podcast?

I hear that's the a big thing.

They use some navel-gazing.

You should get into that, Peter. But yeah, it turns out that the pieces of mine that travel the best are about tech, because everybody's thinking about tech, whether its people at companies trying to figure out how to optimize their businesses, whether it's investors trying to figure out what the next big thing is, what the trends are, everyone is.

And so, this idea of writing smart stuff on the internet, Ben Thompson does it, he charges 10 bucks a month, he has a really big business doing that, there are people like Benedict Evans who wrote smart things on Twitter, eventually became sort of a smart guy at Andreessen. Do you think that's a sort of career for you? Like instead of having to "get a real job." You could just be a smart guy on Twitter and on the internet?

I suppose it could be. I don't know that that's what I want from it. I sort of enjoy it for what it is now, which is just I write when I'm interested in a topic. And what's nice now about it for me actually professionally is just hearing directly from people now inside companies who may confirm or deny different things that I've speculated on.

Right, and that's something that wasn't going to happen four or five years ago because people weren't reading your stuff, they didn't know who you were. And now you've got someone at Snap or someone at Apple saying, "No, you've got this all wrong."

Yeah, yeah, and I think that's useful for me to refine my thinking on these companies.

Yeah, what I'm trying to do is get you to write professionally for Recode, we'll figure out some way to do that. When you were on last summer, I said, "Everyone go check out Eugene's blog, it's amazing, he does all this great stuff." And then if I'm correct, you stopped writing.

I did.

You took like six months off.

I did, I did. I was traveling some, I also just started ...

Sorry if I steered you to Eugene Wei's blog and it was just a big empty space.

I know, I'm sorry to let down your listeners, but I actually just got really bad carpal tunnel that just flared up again, and it's partially because I didn't have a full-sized keyboard, I was just using this like a personal laptop, a little 13-inch MacBook Pro that I'd had and turns out that typing a lot in that less-than-full-sized keyboard caused me to just be unable to write for a while, and so I was just thinking about writing and thinking about ideas. And so when I was finally able to get back to writing, I felt like I just put out something really long.

Yeah, so you did R&R, you rehabilitated your fingers, and then you wrote this massive — how many words is this thing?

I don't know, some people have told me it's 20,000 words.

It's a lot of words, yeah, it's a full hour to read, I think, at least. You might want to take even a break and like go for a walk or something. And we're not going to spend a full hour on this, but we will spend a bunch of time, it's called Status as a Service.

I'm just going to read the top of it and then we'll go from there. There's some intro, then you say, "Let's begin with two principles. Principle one, people are status-seeking monkeys. Principle two, people seek out the most efficient path to maximizing social capital." And then there's 19,900 words after that, but let's start by explaining those two ideas. Okay, "status-seeking monkeys." Pretty much understand that, right, you're saying this is a universal thing, ever since we've figured out how to draw on caves, or even prior to that, we've wanted to set ourselves apart, all right, got that.


"The most efficient path to maximizing social capital." Should probably get some unpacking from you here.

Sure, so you know I think if you were thinking of us seeking status when we lived in small tribes, there was one way to do it, which was sort of very locally contained. And the advent of the internet, and these large social networks allowed us now a new way to maximize our status, which was much more unconstrained and unbounded. And it was really kind of a global status game, so whereas once you might compete for status with kids from your neighborhood or people who worked with you or things like that, now we are in these arenas where we're competing for status with everybody else in the world.

And so what you're doing here is setting up what's going to be a very long explanation of how some big internet companies — primarily Facebook and Twitter, but Snap — work within sort of this framework you've set up. And this also has applications to games and also is worth thinking about when you're thinking about companies that don't really have social components to them. Whether they could be added, whether they shouldn't be, you talk a lot about sort of these two axes, one is utility, one is ... What's the other one?

There are three axes: Status, utility, and entertainment.

Right, you took out entertainment for the purpose of this conversation.

For the purposes, but we can talk about it a little bit there because a lot of people have asked about the difference between the three axes, I focused this piece primarily on status because I think it was probably the least sort of studied or least analyzed axis when talking about social networks. And conventional network effects theory is just like, look, the more users you add, if you believe in Metcalfe's Law, the value of the network grows in proportion to the ...

Yeah, people get that idea, right? Facebook is more useful with two billion people on it than when there were 10, and you can actually argue that's not the case, but that's the generally accepted theory.


And then you also say that one of the reasons that people don't talk about social status here is they think it's sort of embarrassing or puerile or beneath them. And then specifically, say, the people who actually run these companies have more status than almost anyone else in the world, and so they either aren't thinking about it or it's hard for them to think about how their users are approaching this stuff.

Yeah, I mean, it's really hard. When I was at Amazon I remember producing this large analytics package with all these graphs and things, and our CFO would always say, "You know, I never want to see a graph where you're mixing together all these different cohorts of people."

So you can imagine how difficult it is to run a social network like Facebook, for example, which has two billion users across all sort of ages and demographics, different cultures, different countries. How do you even look at a dashboard and understand the dynamics of what's happening? So if you think about that as a series of many, many different localized status games, it's hard to even unpack that and understand what's happening.

So Facebook and Twitter are not the first people to use status to power their business. It does seem, though, that there's this now conventional way that we think about networks like Facebook and Twitter, and that they all involve some sort of display of your social prowess, how many followers you have, how many likes you have, same way we would evaluate pieces of content, this thing has been retweeted this many times.

And in a lot of ways we all seem to take that for granted. There's now a counterargument that says, "Well actually, maybe one of the ways we'd be better off is if we stripped some of that stuff away." But it all seems ... But you're saying, look, this is actually core, this is not just an add-on, this way of tracking and displaying who you are, how good your stuff is, how many people like you, this is core to the product. It's not just that you're sharing your baby pictures with somebody, it's that you have this amount of status and that you are actively thinking about trying to get more status and how to game it, and if you're not then you're probably not really using the service.

Yeah, and I wouldn't go so far as to say that this is the only reason people use social networks because certainly, I use Twitter and Instagram and Facebook and all these networks for a variety of reasons. and so do most people. The second point, though, is that it's easy to forget that time before Twitter got kind of traction, or before Facebook had News Feed. And it's easy also to forget all those social networks that didn't work, that didn't have some of these elements built in. But if you think back to early Twitter, like I said in my piece, it was really kind of boring in the beginning. If people were on ...

It literally was people talking about what they had for lunch.

Yeah, literally. I also like to tell the fact that my first two tweets, spaced a year apart, were, "Doing my taxes." Because the prompt in the box said something like, "What are you doing right now?"

Yeah, mine was like, "I'm going Christmas shopping."

Yeah, exactly. I didn't know why — that would have never been an interesting business. And to me, everything changed — for Twitter at least — when these third-party services started doing these global leaderboards to say, "Hey, these are the most popular tweets." And you looked at them and thought, "Oh, so that's how you get people to like your tweets." And, "Wow, these tweets are really funny."

And for Facebook, I thought that moment when they created News Feed and now you could see everybody's posts put up against each other and you could see that this post had more "Likes" than that post, then that status-seeking part of human nature started to take over.

And that just kicks in, even if you don't think you're doing it you're doing it, you're doing it, is your argument?

Yeah, I mean, I think it's just built into human nature, and if you put people into that arena with that sort of incentive structure, on a global scale where the News Feed is global, then I think it's hard to suppress that part.

And you say some stuff here that is, I think ... Obviously, it sounds like I'm criticizing it, I think uncontroversial, how about that? Where like, the young people are going to be much more engaged in this stuff than older people, in part because they have the capacity to do it and also because if you're old, you've got a mortgage maybe, you've got kids maybe, you've got a lot of other stuff that one, occupies your time, but two, is also your social capital, right? You have a car, and so that car reflects you in some capacity, and if you're younger you may not have any of those things. And so what you do have is a Snapchat account or a Twitter account and that really is your representation of you and the status there matters more to you for that reason.

Sure, yeah, young people tend to have more free time than financial capital, adults tend to have the reverse. And so, if you can put the time in on earning status on these social networks, like if you want to maintain a YouTube channel or you want to post frequently on Instagram, young people have a ton of time to do that. The funny thing about being an influencer, a young influencer today, is if you actually follow any of them, you realize how hard a job it is. They're constantly streaming, constantly figuring out what content to put out to their fans.

They get easy to dismiss because some of them are probably not rocket scientists, and a lot of them are literally doing it from their bedroom so they're not breaking bricks, but it's work and it's savvy and there's a combination of application and talent and serendipity and luck that all makes that work if it works for you.

Sure, and there's certainly ... Some of the resentment, I think, comes from not remembering that time in your life where you were sort of social capital-poor. Another part of it is, look, our status always sort of derives some value from its scarcity, and so if you're an adult the types of social capital that you have — your job title, the size of your house, those things — you want those to have more value than the type of social capital that some kid streaming from his bedroom will have.

And so there's that sort of an old money/new money dynamic that I think, for example, with media versus tech, the East Coast/West Coast war, there's always the sense where old money will want to label the new money as nouveau riche. So if you're old money in New York and you're looking at some hoodie-wearing billionaire in Silicon Valley ,you're sort of like, "Okay."

I find the bristling all comes from the West Coast, like, "That's a New York way of thinking about it." Or, "That's an old media way of thinking about it."

It could be.

And they're probably right, but yeah, especially when someone parachutes in and says, "Oh, there's some problems in San Francisco."


They get very bristly about that. So I think, again, I think intuitively you would understand, "All right, I'm looking at Facebook, I look at Twitter, I can see that people are trying to get likes on Instagram, I can see where all that's going." You would also think that lots of people would be taking those mechanics and adding them onto other businesses. If you have a — this is a media podcast so we'll talk about media — if you have a successful streaming video service, why not make it better by adding social components? Some people have tried it, it generally hasn't worked, so why hasn't it worked and could it work for somebody else?

Mm-hmm, well, I use an analogy in my piece for social status to sort of like a cryptocurrency, where there's sort of some hurdle you have to go over to get ...

Proof of work, right?

Yeah, some proof of work for you to earn the social capital on the network. So for example, for Instagram, the proof of work is take a really interesting photo that people will like. On Twitter, it's to compose something witty under 280 characters that people will want to share.

So, for I think a lot of media businesses and things like that, where you're just passively consuming content, there isn't really some meaningful sort of proof of work where you'd earn status that actually has any value for somebody. Like Netflix, for example, if you were to try to graft some sort of social network onto it, I don't know that a conventional like, "Hey, let's create a feed where people are liking and sharing things" makes sense.

Right, and Netflix tried that thing with Facebook where there was this "frictionless sharing." I think in Netflix's case specifically said, "People don't want to share what they're watching necessarily, they might be embarrassed for various reasons about what they're watching." But people have tried the sort of gamification of stuff like that. And leaving aside not wanting to let people know that you're watching Triple Frontier — it's a fine movie … it's not a fine movie.

It's okay.

It's entertaining.

Yeah, it was okay.

In a certain way. But people have tried various, I've seen a bunch of this stuff, "You're going to accumulate points for telling friends about this." And those things all seem like they could work and none of them work.

Yeah, it's hard. It turns out it's actually hard to create a new form of status that is both meaningful to you but also meaningful enough to enough other people, because status, look, is always derived from the entire network, right? I can't just say that I did something and get status from it if no one else thinks that thing is worth ...

They have to validate it and say, "This actually is pretty cool."

Right, right. So you have to do something where a lot of people together will say, "Look, this proof of work is meaningfully hard, like not everybody can do this." And second, where people are like, "You know, I actually respect that they did that." You saying you had binge-watched some series on Netflix doesn't feel necessarily like a high-status thing, it might even be seen as low status that you were spending all this time watching a show. So, it's not so easy and this is why you see now ...

And I can see from the outside, though, why it would seem like, all right, "Peter announcing that he finished Triple Frontier isn't really inherently more interesting than one of the Kardashians talking about what they bought that day." It's really the same thing. Of course they're very different, but it's hard to sort of see where that line is, other than lots of people pay attention to the Kardashians. And even though I've said repeatedly now on this podcast that I've watched Triple Frontier, no one has asked me what I thought about the movie.

Well, we could talk about it afterwards, I've watched it too, so I'd love to hear your thoughts, Peter. I do think that one of the tricky things with media in general is that, as you said with the Kardashian example, look, people do pay the Kardashians like a million dollars to post something on Instagram because enough people care what they wear.

And again, you can understand mechanically, "All right, they're celebrities, this is the same thing as them being on a TV show or on a screen of some sort." So we get the part of why that's a business, sort of explaining why that particular thing is interesting other than they're attractive young women, is sort of baffling to I think some people.

Yeah, absolutely. The other thing about media I think that's tricky to do social games with, especially for video or television or film, is that I think that category more so than music and books is a category where ... You know that term "narcissism of small differences"? I almost feel like even if you get a bunch of film lovers in the room, they will find a way to disagree about some movie in the most really specific way. And we tend to only watch movies and TV shows once. It's not like music where you're listening to tracks hundreds of times.

Right. A lot of people like Breaking Bad, but if you wore a Breaking Bad t-shirt, you're not really identifying with something in the same way you do if it's a pop star.

Yeah. Look, it is true that once, I think in an age where there was less overall media, you might be able to wear a Breaking Bad t-shirt or say that you were a fan of Star Wars or something, and that is like a social network that you join.

Yeah, we discussed that last time.

And that's a great thing. But we're also in an age now where I think the abundance of the media, essentially the infinite amount of media content, has made it harder and harder to do that.

So you've been ruminating about this idea, which again, in some ways I think anyone who's following you goes, "Yeah, yeah. We understand there's social status. I'm sure that's the whole point of it on Instagram." What was the main surprising idea that occurred to you as you were assembling this thing? What was the thing you wanted to get off your chest?

I think that the biggest thing for me was just I think our models, our mental models of social networks, will be more complete if we just factor in status as one more element. Not the only element, but one more element in why certain networks work and why certain networks don't. And the broader reason I think this is important is that I feel like we're at the end of the first generation of large social networks. Like the ones that are big that we talk about now have been big for a number of years.

And in Facebook's case, they're still growing, amazingly. And Twitter really isn't growing, and Snapchat ... I mean, they're kind of fixed, right?

Yeah, they're fixed. Instagram is still growing a little, you have some companies in China that may be experiencing some growth. But they've been around long enough where ... I also think with sort of this current reckoning that we're having with social media, we are at this point where we're taking a look back at this sort of first era of social networks and saying, "Well, what did we learn? Where were we right? Where did we go wrong? And how can we fix or change these networks moving forward to take advantage of what we learned?" And I think status is a part of understanding what happened in this first era.

So regardless of whether we have a new crop of Facebooks and Twitters at some point, or maybe we're just kind of stuck with these guys?

Right, right.

How do you feel about that, by the way? Because for a long time, I just assumed anyone who followed this stuff assumed that we used to have this service, and now we have that service, and there's just an ebb and flow to these things. And someone will come along and replace Facebook. And now it seems pretty calcified. And one theory is that's because all the prior stuff didn't exist before phones. And so once you have phones and it's truly global, whoever gets there first sort of wins and won't be displaced. So do you think there will eventually be a new crop of Facebooks, Twitters, Snaps?

I don't know for certain. I certainly think it's getting harder to displace the incumbents. And the whole status piece, I think, gives you sort of two directions to go on this. One is that because status is derived from the network and derived from scarcity, you could argue that if the existing social networks lock in too much status for people who are already on the networks and who have been using them for a long time, that a new generation of young people will come along and say, "Look, I don't want to be on this network because the status has all been sort of drained out of the system."

And it's so hard for me to break through, right? There's people here who are basically squatting, because they showed up 10 years ago, and maybe they weren't even particularly good. There's a lot of those that exist in a lot of these social networks or YouTube, where if you showed up in 2006 and uploaded videos with any kind of frequency, decent chance you were going to become a YouTube star. Now there's no way you can do that, or it would be very, very hard for you to break through.

Right, right. And that's where the analogy to crypto comes in, in that it gets harder to mine bitcoin over time because they have to enforce the scarcity for it to have value. So if the social networks aren't good about managing this, then you can see why a new social network might pop up.

You might find a new club where you and your cool friends, or just you and your friends, can do stuff.

Right. A huge part of the dynamic, I think, of the exodus from Facebook to Snapchat a lot in the beginning was because there was a set of young people who were like, "Oh gosh, my parents are on Facebook now and they can see what I post to News Feed and that completely changes the dynamic of what I can post there, and so we need to find our own space."

Now, the utility access I put in there because I think many ...

So when you were talking about the idea that you can measure these things based on how much social status they have to disperse, or what you can do there and then also how much utility they provide.

Right, exactly. And the nice thing about utility, which might be, for example, like in China you can use WeChat to pay for things at a restaurant. Or you can use a social network to call a car or something like that.

And you do do all those things.

You do all those things.

Because you can do a bunch of this stuff on Facebook, but for the most part you don't.

Right. And so I think more of the large social networks are going to start looking at utility because status is inherently volatile, and you don't want to be managing a network built only on status when there's a sort of implosion of the value of that status. So if the current generation of networks starts to do a good job on adding utility, that's much harder for a startup to displace. If you're a new startup and you're trying to build some company, it's not going to be that easy for you to build a global payment network.

Right. You had an aside there saying, "A bunch of my friends over the last few months have stopped using Facebook and they seem to be okay." And if you're in China, you really can't stop using WeChat, because it's not just social, it's how you're going to pay for things, how you're going to get around.

Right, right. And if you open WeChat, for example, in China, the page that you open to is not a newsfeed-like thing. It's actually really funny, if you open WeChat and try to find that newsfeed thing that they have. It's a couple taps away.

You got to work for it, yeah.

Yeah, like you open WeChat, and it's there for you to message people. It's a messaging utility first and foremost, and then it does like 50 other things for you in your daily life. So whether it's with Facebook cryptocurrency or Instagram adding more convenient shopping or it's Snapchat adding a lot of features on top of its messaging platform, just like disruption theory, all the big incumbents were like, "Oh, wait a minute. We don't want to be disrupted. We can head that off."

And so you think that in Facebook's case, in particular, like intentional, "We want to add utility." They've tried over the years to add utility. It hasn't really worked. Do you think it's because they don't know how to do it? Or their users just reject it? Or they just haven't found the right use case? They've done messaging, and then they went out and bought another messaging service. But Facebook Messenger's a thing. They have that.

Yeah, that actually worked well, right? That's a case where they wanted to make Messenger more useful. They broke it out into a separate app. I don't know how many people use Messenger. It's a lot. And that's a great case where they succeeded. For some things like payments and things like that, I don't know that they've continuously tried to crack that nut. But I think they should, and it's probably a category that they're going to spend more time on.

In the same way that Instagram, which is for young people actually a very powerful status game, if they add more things like shopping into it as a utility, I think that's just more durable in the long run.

And you think that's a practical way for them to go, and it won't scare off people who are using Instagram to do whatever they're doing on Instagram right now?

Yeah. I think ultimately, we all go through this sort of like hedonic treadmill thing where if you play status games for a long time, you can get tired of them. Or you can get sick of them.

Did you say hedonic treadmill?

Yeah. I just, I use that as a term, but I think ...

I got to Google it.

Yeah, yeah, yeah.

Like hedonism?

Yeah. There's something about playing a status game for a long time that it's like eating too much sugar. You feel just sick from doing it. And you know like people ...

I've accumulated all my likes and now I feel bloated.

Yeah. Like once, it might have been exciting to get 50 "Likes" on a tweet. And then you're like, "Ah, actually I need to get 100." And that can be tiring. And you hear this from people who are on social media a lot, they feel like they're just exhausted and they need to take a break from it, and so, yeah.

What do you think of Mark Zuckerberg saying, "I'm going to move the focus of Facebook from public consumption and public display. We'll still have all that, you can still do it, but we think our users want to have private conversations with encryption." And then there's obviously political and regulatory reasons he's talking about doing that. But he's also saying, "This is what I think our users want to do, I'm not trying to create a thing they don't want." That would seem ... I mean, it's hard to imagine how you accumulate social status through one-on-one chats.

Yeah. I think that's an acknowledgement of ... Look, one of the central ideas of this first generation of social networks was this idea of something that's like the newsfeed, a public monolithic thing, where everybody's in there. Like what Jack calls the town square of Twitter. And many people were doing that because it turns out that's a really efficient way to create a mass engagement game.

But we're now also seeing some of the sickening side effects of this sort of mass public display of performative status-seeking. And so I think Zuck is sort of skating towards where the puck is already going. I've seen a lot of people in my network even stop posting publicly and move ...

But some of that is a specific distaste for Facebook, and some of that specific distaste is because they think it created Trump or elected Trump. But the whole premise of you writing this thing is people are status-seeking monkeys. So if that's the case, that we're moving toward private communication, how do you square those two ideas?

Well, I think there will always be some balance. I don't think Instagram or Facebook or these services will take away that public monolithic feed, where people do still continually try to rack up likes and things like that. However, I think there's a recognition that, "Look, we're losing some people who are taking a lot of their more honest selves into private conversations." And ultimately, I think this is all about squaring the complexity of people's identities with these services. I say "status" and people have a negative connotation to status-seeking.

Yeah, because they're thinking about cars and jewelry and looks.

Yeah, exactly. But if you flip it, another way to put it is that people really want a sense of self-worth and identity from social networks. And I think part of our identities requires there to be some level of privacy, where we can try out ideas and personalities and things without the glare of the public spotlight on them. And I think people are adjusting their behavior because they've realized, "Oh my gosh, I shared too much."

"This thing I wrote last year is still up there, and now I have a new job and people don't think that's funny." Or, "Now I can't host the Oscars."

Yeah, yeah, exactly. You look at athletes who are getting dinged for some terrible things they wrote as teenagers. People will go back and weaponize anything that you wrote in the past. So I think this sort of adaptation, like Facebook moving more towards this public encryption and public messaging, is just reflective of the fact that we probably do need a suite of ways to express who we are as humans, and that most networks are too constricting in how they force us to be one way. A good example is I don't write as much on my blog now because the ones that go viral are about tech.

Because you know people are paying attention.

Yeah. And so I feel like I have to only write about tech, whereas if you read my blog in the early days, I would write about food or movies or music ...

You had a really good post about garbage collection, in ... Was it Shanghai?

In Taiwan, in Taipei.

In Taiwan.

Yeah. And you do feel constrained, where on Twitter now that I have more followers, I also feel if I don't tweet enough about tech, people might unfollow me. So how do we create the next generation of networks where everything that you are as a person can be expressed, and the network appropriately funnels that content to the people that care about it?

We use following people as an approximation of following interests, but the fact is, like if John Gruber, most people follow him for Apple coverage, he still likes to talk about the Yankees. And if he started just tweeting about the Yankees full time, a lot of people would probably unfollow him.

What's great is Ben Thompson has a whole feed just for NBA.


So if you really want to know what Ben Thompson thinks about the NBA and the Milwaukee Bucks, you can go track that down.

Yeah, NoTechBen. NoTechBen is his Twitter account for discussing the Bucks and the Brewers and all the Milwaukee teams. And the fact that he has to do that is sort of an indictment of Twitter not allowing people to follow interests more generally and be fed stuff that's more tailored to them as readers or viewers.

One last question on this essay, which you should all be reading: There is a conversation — at least, I think it mostly comes up around Twitter but some other folks as well — saying, "Maybe we should take down some of the status stuff. Maybe we should not tell you how many retweets this thing got. Or maybe you shouldn't display your follower count. We should remove some of the status-seeking elements to our network for various reasons." What do you think of that idea, and do you think people are going to follow through on it?

I think it's tricky because I start my piece with the idea that we are status-seeking monkeys. And I've just told you that I think our sense of self-worth requires some forms of feedback, right?

And so even if you stop wearing, like if the trend is, "We're not going to wear Izod or Polo shirts because that's gauche, and we're going to not have labels." You still find ways to sort of indicate the status of the shirt you're wearing.

You know how in futuristic science fiction movies it always seems like everybody wears the same outfit? You know, it's like some white robe or something bizarre like that. And I just don't think a world like that is going to happen, where everybody's like, "Look, I am no longer going to signal anything about my personality or status, we're all going to wear the same outfit." You know, it's the whole school uniform idea, like they want kids to just wear the same uniform because they don't want people competing.

Right, and then they just find that one thing that they can modify, and the focus goes on shoes, or whatever it is.

Yeah. We all crave some level of distinctiveness. We want to stand out in some ways. And so I think that's fine. Like I love just the variety of people I meet online, their personality, the various things that they really geek out over. I love all of that. Can we preserve some of that while removing the more egregious harmful forms of status-signaling? I think it is possible, but it requires us just acknowledging that that is a part of human nature, and that's a part of why they flock to certain things on social networks.

You learn a lot reading your blogs, and then you learn even more talking to you. It's great, it's a free education. You should charge for this somehow, Eugene, I'm telling you. I won't even take a cut. We're going to build a business around it. Or you're building a business for me, which is great, so thank you.


Just an aside, you had a line there, it just reminded me, you were pointing out that the people who have become famous or used social media to build these businesses — Kardashians, Logan Pauls, etc. — all of their attempts primarily to then go out and create their own standalone social thing have not worked. They've been able to go to other platforms, and obviously they get paid a lot to do one-off things, but the idea of them creating their own hub, I remember we had talked to folks, we were doing [an interview with] the WhaleRock guy, he was working for the Kardashians…

Right, right.

Why doesn't that work? Why can't people port their audience from Facebook or Instagram or Twitter to the thing they're doing? I mean, they do do it, so why does it not work as an ongoing thing?

Well look, execution is always one of the risks.

So stipulate that it's hard.

Yeah, yeah, it's hard. But the second thing is, if you look at most celeb standalone efforts, the apps that they create or whatnot, those actually are not very good at being status games themselves. What they are is mostly a way for someone famous to just distribute content directly to a set of fans. These apps are usually set up as having a newsfeed or something, but none of the fans of that person are actually interacting with each other. There's no proof of work for them to earn status over other users.

They're just there to get more stuff, which is fine.

Which is fine.

But limited, I guess is your point.

But limited.

That's why it doesn't work?

Yeah, that's part of it. The second thing is that if you look at the lifecycle of high-status influencers, it's interesting because we've had enough time now to see some influencers come and go. In many ways, the Kardashians and Jenners are unicorns in that they've had a much longer run and a much more successful run at this. But many young influencers come and then they kind of fizzle out over time.

And we're just using "influencer" just generic for "person who's famous on the internet."

Yeah, exactly. Someone who got famous on the internet and then at some point, people accuse them of being famous for being famous. It's actually a very fragile thing. One of the funny things, if you talk to, for example, young teen girl influencers in the fashion world, you end up with this weird, you're almost like a hostage to your fans and the narrative that you put out there about yourself. If you were to break up with your boyfriend and start dating someone new, your fans might revolt and lose interest in you.

I think it'll take another 10 years or so for us to study the life cycle of a couple waves of influence to understand what exactly is happening there and who has staying power longer than just a couple of years of their teenage life.

By the way, as an aside because we're not going to get into this, but you spent a lot of time talking about and TikTok here, and that's one of those things where I think a lot of folks maybe had heard briefly of and maybe they've got some sense that TikTok's a thing. You do a very good job of explaining what it is, why it works, why certain people are using it. Primarily young girls, I think it sort of over-indexes. Go read the 20,000 words.

I do want to ask you a couple Amazon things because I do like mining your brain for Amazon insight. Amazon, I think, has sort of replaced Apple for the sort of consumer internet company that people are most interested in and/or at least optimistic about it. I mean, Facebook generates a lot of headlines, people use it a lot.


Amazon is still I think almost entirely — regulators aside for the moment — people feel really good about it. I'm curious how you view the company from the outside, specifically about two different things. One was their decision to move HQ2 to New York or partially move HQ2 to New York and then after a couple of weeks of really not much, maybe a couple of months of getting some negative pushback, deciding they weren't going to do it.

In my mind, I think of Jeff Bezos and Amazon as sort of like earnestly analytical, very sober, very serious, and they might take risks that don't work, like the Fire Phone, but those are calculated risks, and then they sort of dispassionately walk away from it when they're done. This seemed really abrupt. Am I right in thinking of this as an un-Amazonian move?

To some extent. Look, I think all companies maybe have some level of blind spot when it comes to how they are regarded by the public. I say that not just for Amazon, but I've been inside several companies now, and I think it's hard to describe to people on the outside how much of a bubble it can be going to work with your coworkers every day, not necessarily seeking out all the negative stories that are written about. Like who likes reading constant stories?

Or when you hear them you ignore them.

I'm sure, for example, people at Facebook have, and I would agree, like some of the stories written about them are unfair at times. It's easy internally to build up a narrative where you're like, "Look, they're just out to get us," right? The East Coast/West Coast thing I talked about before, to become ...

"The New York Times is trying to win a Pulitzer," which is true.

Yeah, it can become a narrative in your head, and that makes it just so easy if you frame things that way to ignore all of that and to not see some of those things. When I'm not at a company, like I haven't been for a bit, it's just a completely different way in which you regard all of that.

That explains them like making the mistake and not understanding why this would be a problem. In their defense, the mayor of New York City and the governor of New York state said, "We're doing this, and this is going to be great." You'd kind of naturally assume that it was going to work. Then the decision after a couple of weeks to go, "No, we're outta here," that was the thing that really surprised me. I just assumed they would — again, because I have a perception of Amazon — like, "We've thought this through, we're going to stick it out, we don't make these decisions lightly."


It seemed like pretty capricious.

Yeah. Look, I don't know that it was capricious or not, but it sure seemed to be trending in a direction where it was going to be a knock-down, drag-out sort of battle.


It was going to drag the brand through the mud, and is it worth it? Ultimately, one of Amazon's strengths as a company is that they could even contemplate an HQ2. They have like seven, I don't know how many employees, 700,000, 800,000, some astonishing number. They're in how many lines of business? It's staggering, because when I started, it was a domestic bookseller online. Just scaling to that degree actually requires you to be able to run kind of as a distributed company with a lot of things.

The fact is they maybe really wanted to be in New York, their company already runs in a distributed way, so ultimately, I don't think it hurt them that much to say, "You know what, let's just go somewhere else."

I get the logic of them saying, "We don't actually need to do this." It's just quite a bit of whiplash from them spending a year-plus with the pageant and the bake-off.

Well, look, I think there probably were some mistakes made along the line in this whole process, but one of the strengths of the company is look, like once you realize it's not worth it, not being captured by sunk costs, just write it off and just say, "Let's just move on."

Got it.

Yeah, be done.

As you know, Jeff Bezos had an affair and then got divorced and then wrote a post on Medium accusing the National Enquirer of trying to extort him. It's an extraordinary story, and I don't want to ask you about any of the details there because you don't know about them. I am curious about how you think people in Amazon think about it because the way this has been discussed in the press, it's almost entirely, "This is Jeff Bezos, it's his personal life." And whether we're prurient or whether it's interesting, it's divorced from Amazon.

I haven't seen any analyst notes or really any serious business coverage about what does it mean when the CEO of this company is engaged in this very high profile, very unusual fight that involves the National Enquirer and the president of the United States and maybe Saudi Arabia? Again, it seems very un-Bezos-y, but also just in terms of the company, you would think at some point it goes from "this is your personal life" to actually "no, this does affect the way the company works." Do you think that discussion is happening internally or do you think they just have accepted the idea that this is investing in ... what's the name of his rocket company?

Blue Origin, is that it?

Blue Origin. This is just a thing he does. He fights with Donald Trump on Medium.

I haven't been at Amazon for so long.


I actually have no idea internally. I do think that ultimately one of Jeff's strengths is his ability to just be sort of like laser focused on the business and what matters and just always compartmentalizing all that's not important and focusing on what is important.

You believe that, so that is essentially the narrative explicitly and implicitly that they're putting out. You go, "Yeah, I buy that." I do think that he can do one thing over on the Medium post and another thing where he's trying to figure out toothbrush sales.

I think that's one of his best strengths as a leader. Look, ultimately, I think every one of the big tech companies, whether it's Amazon or Facebook or all this, there's a lot of just media noise around them in general. I think there's no doubt that if you talk to people who work at all these companies, some of it affects them. Like especially when I was more junior as an employee, I would read negative stories about Amazon in the press. I was just starting out in my career and my mom would mail me press clippings. She's like, "Oh my God, this story said that Amazon is going to go bankrupt."

You're going to go out of business.

Yeah, like, "What's going to happen to you?"

Well, that was the cover of Barron's, right?

Yeah, yeah, exactly. Amazon.bomb, Amazon.toast. You're constantly reading these things, and the more I've sort of gone on in my career, the more I've understood that look, the press is doing their job, right? They are going to cover things and come up with really interesting contrarian angles and stuff to raise a bunch of noise around things, and that ultimately, if you just keep paying attention to it, you're just going to get whiplash from emotionally trying to deal with it and to mostly filter all of that out.

All right, delicately answered. Good job, Eugene. Then the last old company I wanted to ask you about, you were at Hulu for a bunch of years.


Not responding to my questions even though it was your job to do that. I guess your job was to ignore me, so you did a good job.

Exactly. I was doing my job.

We referenced this the last time you talked, but now that we're really in it, right, you've got Netflix at 140 million subscribers, and this is the year where all the big media companies that have sort of enabled Netflix ...


... are now saying, "Hey, we actually should be doing what you're doing." A couple of days from when we're talking, Disney is going to roll out its plans for Disney+, I guess. Time Warner/AT&T is going to, near the end of the year, kind of explain what they're doing maybe.


Next year is NBC, and then there's this weird Apple thing that we spent a bunch of time talking about on this project.

Sure, sure.

What is the thing that you learned at Hulu that would be useful for these new entrants into streaming and SVOD that would be useful for them to know?

I don't know that there's one particular thing that I learned there, except I would say, well, there are two things I think that matter. One is that the one thing that no single company controls is the competitive context into which they are thrust. What I mean by that is the amount of content, the amount of shows and films that are out there has grown by magnitudes of order at this point.


You can't control that because how much stuff other people make is sort of independent of how much stuff you make to a large degree.

Although if you're Netflix, you're making a lot of it yourself, right?

Yeah, exactly.

They are spending billions of dollars.


They are controlling that.

I just think some of the playbooks that media companies have were created in an age when the competition was much less. That really affects, actually, the diffusion of your shows and stuff and how it takes with a culture in which, so this is a good place to bring in the entertainment axis of my three axes of social networks.

I think the biggest change in my lifetime and the reason I separated out entertainment and utility is that when I was a kid and I went to the movie theater to see a movie, I did not see that as competitive with listening to the radio on the way to the movie theater. I didn't see that as competitive with going home and watching Friends on TV. Back then, we didn't have phones, so the contexts were sort of separate from each other and none of those competed with each other.

Right. You did this and they did that thing.

Right. The biggest change in our lifetime is that entertainment is now fungible. At any moment in time, you can pick up your phone and you can read the New York Times, you can watch Netflix, you can watch YouTube, you can go to Instagram, you can go to Twitter. In the consumer's mind now, all forms of entertainment trade off against each other. You might say that, hey, this podcast, or listening to some music on Spotify isn't the same as playing Fortnite. When Netflix says that they compete with Fortnite, actually all forms of entertainment compete with all forms of entertainment now.

Right. There's two versions of that Netflix competing with Fortnite. One is they used to say Angry Birds, right? People could spend their time on the Angry Birds app and now they can do that. I think what some people are also saying in part because Netflix is saying it is, Fortnite is an interactive game where you interact with ... and we're increasingly interested in that idea. Not social interaction, but we're going to be engaged with you. You're going to choose your own adventure, like a branching narrative, they call it.

Right, right.

I think that's where they're sort of saying, "Hey, this is the direction we're going." They don't tend to do a lot of head fakes in Netflix. We'll see. Sorry, I digress because your point is these things are all fungible.

They're all competing.

The consumer has a limited, has a finite only 24 hours.


You can multitask and do a bunch of stuff. That's where they're still …

That's one point. Then my second point is just that Netflix, look, the media companies may want to roll back the clock and everything, but the fact is that Netflix got the scale advantage.


They got the high ground, and it's very rare in history to see any company successfully take on a company with a scale advantage by actually just copying what they do. I get why AT&T might come in and say, "Look, HBO should be making a lot more stuff." Kind of like Netflix, right? Justify this flat rate subscription. The fact is the whole definition of scale advantage is that Netflix has 100 and whatever, 50 million subscribers and you don't.

If they want to spend $10 billion on content, and you say, "I'm going to spend $10 billion on content," they're spreading that cost across a lot more people.

Right, that $10 billion is much more expensive for you.

It's much more expensive for you. Is it possible that you could spend $10 billion more efficiently than Netflix? I mean maybe, but probably that's a skill that doesn't really exist. I think that whole thing, the idea that it's not TV, it's HBO, that HBO thought that they would always make superior content, a lot of that was just the product of HBO was the only place to go in town back in the day to get that type of stuff.

To get that kind of programming.

Now you see, right, like the showrunners of Game of Thrones, what are they going to go do next? I think they're going to work on Star Wars stuff or something like that.

Yeah, they said they were going to do an HBO thing. Who knows? I was going to avoid Apple, but I'm just curious what you think.


Apple is going at this, and at least as far as we can tell, they're using their money and their scale. They have a lot of both, but they're not trying to supersize anything. As much money as they're spending, a billion, $2 billion a year, it's a fairly modest amount of programming, right? A couple shows a month. They don't have a library. They seem to be running counter to sort of what everyone else is doing, which is saying, "We have a lot of stuff that we either own because we're Disney or AT&T."


"Or we paid for it because we're Netflix. We're going to throw it at you, and for 10 to 20 bucks a month you're going to have that."


Apple seems to have some other take on it. Does that make sense to you that they wouldn't go that way?

I actually think the world would be way more interesting if Apple, with their huge amount of cash on hand, really did try to take on Netflix a little more head on, right?


Because they're the one company, I think, that has enough free cash to actually make that a credible strategy. The way that you would envision that working is that, let's say Netflix spends $20 billion on content next year. Well, Apple could do that. If you think that a lot of Netflix content actually decays in sort of relevance really quickly, then all it takes for Apple is to spend $20 billion a few years in a row to actually sort of like catch up and have a catalog that's equally interesting.

Right, because Netflix will say, "Marco Polo that we spent $100 million on seven years ago," which in a traditional company would've maybe been a write-off, they say, "No, no, this still has value." And you're arguing, it probably doesn't have any value.

Well, part of the big change in the world is that because there's so much content now, I actually do think the decay curve on content is much faster. Like two weeks after Stranger Things season two came out, I felt like nobody was talking about it anymore.

Right, and again, Netflix will say, "Yeah, but that's just Twitter and it literally doesn't matter to us whether someone watches Stranger Things for first time in four years as long as they watch it."


"It's great."

Right, right. I don't know. Only they have the metrics on whether that decay curve ... I think the key metric to watch for Netflix moving forward is how many years can they amortize their content over? The longer that number is, the better things are for them and the harder it is even if Apple spends $20 billion to catch up.

As it is, the current Apple offering, as I saw it from their keynote, looks a little bit like kind of like, "Me too. We have a service. We have a lot of phones and things in people's hands, and so if we tack this on, it's probably going to do pretty well." Kind of like Apple Music did pretty well, right, just through the distribution. It's not going to be a service predicated on being revolutionary and dominating the video streaming industry.

Apple Music was the same thing as Spotify. Like really, very little difference there, and they had the exact same catalog of stuff.


It's just a thing on your phone where this is a different ... You will have to decide whether you like the Jennifer Aniston show enough to pay for it or at least watch it.

Sure. As we all know, that's a very capital-intensive tricky game. I think you're better off thinking that no one company is better than any other company in making these things, and in fact, that it's just kind of like VC where it's just a portfolio of stuff. You're like, look, "If we make enough stuff, a few things will appeal to enough people that enough people will subscribe," and that's just classic bundling strategy.

It sounds so dull when you say it that way. I find it all very exciting.

Look. Yeah, that's why you bring the Spielbergs and the Oprahs onstage.

Exactly. Not Eugene. We'll get you there eventually, but you make great podcast content, Eugene, so thank you for coming.

Thank you. I appreciate it.

We'll have you back in a year.


If you want to come, you're always welcome.

Oh, I'm always happy to come on.

Recode and Vox have joined forces to uncover and explain how our digital world is changing — and changing us. Subscribe to Recode podcasts to hear Kara Swisher and Peter Kafka lead the tough conversations the technology industry needs today.

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