PivotKara Swisher: Kash Patel is a “National Security Risk” | Pivot
EVERY SPOKEN WORD
65 min read · 13,203 words- 0:00 – 0:17
Intro
- SGScott Galloway
I think Patel is all of the incompetence with none of the stature or bravado. I just think he looks stupid.
- KSKara Swisher
[upbeat music] Let's get into today's news, Scott. FBI Director Kash
- 0:17 – 7:20
Kash Patel Sues Atlantic
- KSKara Swisher
Patel just filed a two hundred and fifty million dollar defamation suit against The Atlantic over an article he called a quote "hit piece." It was not a hit piece. The Atlantic is calling the suit meritless. The story is based on interviews with more than two dozen current and former officials about Patel's time at the FBI. It alleges excessive drinking, frequent absences, and erratic freak outs, including over computer sign-in. There were reportedly multiple times over the past year where Patel's security detail had trouble waking him because he appeared to be intoxicated. One incident involved a request for breaching equipment, the kind a SWAT team use, uh, after Patel was unreachable behind locked doors. It... This is all true, everybody. It's repulsive when you read it. So what do you think's happening here? What's going on in the... as to the lawsuit?
- SGScott Galloway
Look, I, I think The Atlantic, my sense is this is thoughtful reporting, and his, uh... it seems like his drinking is sort of an open secret. It's not about alcoholism, in my view. It's incompetence.
- KSKara Swisher
Mm-hmm.
- SGScott Galloway
I, I don't doubt that the alcohol hurts him, but generally speaking-
- KSKara Swisher
Mm-hmm
- SGScott Galloway
... this is an incompetent person-
- KSKara Swisher
Right
- SGScott Galloway
... who has lax judgment, doesn't show up for work on time, panics. Uh, uh, you know, he's so skittish, he thinks that, he thinks that he's not, um... that he's being fired. I don't mind you drinking during the weeknight if you work for me, but be at work the next morning. And if you're not drinking and you don't show up at work, it doesn't mat- it doesn't matter why you aren't showing up for work. This guy doesn't appear to be showing up.
- KSKara Swisher
Right. Right, right. They-
- SGScott Galloway
And is totally focused on-
- KSKara Swisher
This was alleging that drinking had a lot to do with it, as he drinks so much, he drinks to excess, that he doesn't-
- SGScott Galloway
Right.
- KSKara Swisher
He's also... It creates a national security risk, which is, I think, why all these people are leaking, right?
- SGScott Galloway
Fair point.
- KSKara Swisher
It's not because they l- dislike him, but he also is a huge national security risk. He's also abusing his privileges. Very Kristi Noem here, right? This is the version of Kristi Noem, and obviously, it's so- sort of who's gonna Kristi, who's gonna take him down, right?
- SGScott Galloway
Well, I like the idea of him and Hagsath are now referred to as the liquor cabinet. [chuckles]
- KSKara Swisher
Yeah.
- SGScott Galloway
I think that's a good one.
- KSKara Swisher
Yeah. Yeah. There was a good one. They said, uh, "Defense secretary, a FBI head, and a lead prosecutor go into a bar." Oh, wait, that happens every day. [chuckles] It was for Jeanne Biro, is the other one they were talking about. This group is really kind of... They're just, like, so not in control of themselves. Let me just say the la- the one thing that really was the most disturbing in that entire story was that he then will try to do something to please Trump, like try to prosecute people who prosecuted January 6th people or do election denial. He's gonna try to serve up, like, a little, a little mouse to Trump in order to save his job, and the only thing that Trump hates is drinking 'cause his brother was an alcoholic and died. Um, but it, it'll be interesting if Trump will not fire him because of this piece, if that makes sense.
- SGScott Galloway
Yeah, my first girlfriend was, um, Mexican and an alcoholic, and I-
- KSKara Swisher
Oh.
- SGScott Galloway
She used to order drinks called, um... And I asked her what her favorite book was, and she said Tequila Mockingbird.
- KSKara Swisher
Oh, my God. [chuckles] Okay. Well, anyway-
- SGScott Galloway
That's not very good, is it?
- KSKara Swisher
Do you think Trump will fire him?
- SGScott Galloway
That's not very good, is it?
- KSKara Swisher
I think so. I think Trump's gonna fire... He's gonna fire a couple of these people.
- SGScott Galloway
Three guys walk into a bar: an alcoholic, a priest, and a child molester.
- KSKara Swisher
Mm-hmm.
- SGScott Galloway
And that's just the first guy.
- 7:20 – 17:00
Trump’s Iran “Incompetence”
- KSKara Swisher
threatening to retaliate after the US military seized an Iranian-flagged, um, cargo ship trying to bypass the blockade in the Strait of Hormuz. Iran is calling it an act of piracy. Meanwhile, JD Vance, Steve Witkoff, and Jared Kushner are headed back to Pa-Pakistan for more peace talks, though it's unclear if Iran will even show up. Uh, first JD wasn't going, then he was going, and Trump was saying all manner of things. Trump, of course, is once again threatening to take out Iran's power plants and bridges, which I know it feels like Groundhog Day, but he's doing it again. The ceasefire is due to end this week. Um, I'll also note Energy Secretary Chris Wright thinks gas prices might stay above three dollars until twenty twenty-seven, though Trump is saying that's totally wrong. California was six. It was crazy. It was six or w- in the mid sixes, which is 'cause they have more taxes there, obviously. But, um, any thoughts what's happening here? 'Cause it seems like, again, still, it-- they still haven't gotten their act together, this gang. They can't shoot straight.
- SGScott Galloway
There's so many things that are bubbling up in terms of incompetence in institutions and a general approach to government that took immense resources that Americans have taken for granted, and one of those things is our incredible diplomatic corps. We gutted the d-diplomats. We gutted the anti-terrorist group. So w-when you have these summits or peace talks, ninety-five to ninety-eight percent of the work is done, done before the person lands on the ground, and that's the problem is zero percent has been done here. He might as well... He... This is the most... It is so easy to predict nothing is gonna come out of this. And I was, uh, you know... I, I've been saying that masculinity, a decent proxy for masculinity is are you optimizing for attention versus service? If so, that's the opposite of masculinity. That defines this ridiculous trip to Pakistan. There's been no diplomatic work done. He's gonna land. He's gonna make an indignant speech. He's gonna look for a TikTok moment that he at-attempts to make him look, make himself look presidential. He'll make further irresponsible, incendiary, unnecessary comments. He'll leave, and nothing will have happened. And, you know, the, the only other... What I've been thinking a lot about lately is kind of the winners and losers here. Initially, China's a loser because of the, the security threat around not having the free flow of energy. They are such a big winner long-term 'cause I was thinking about, how does the world structurally change on the demand side? You gotta think that in addition to the economic costs of the Straits of Hormuz being, um, sequestered or blocked, every nation in the world must be thinking, "You know, we don't wanna be dependent upon fucking straits that can be controlled by the IRGC or by Trump."
- KSKara Swisher
By the way, there's-
- SGScott Galloway
So we're gonna move to renewables
- KSKara Swisher
... can I just interject? There's a couple-- There's a really good online, um, thing that was about, there's not just the Straits of Hormuz. There's an area near China that forty percent of the shipping goes through. There's a number of places around the world where this happens.
- SGScott Galloway
The Strait of Malacca or Singapore.
- KSKara Swisher
Right. Yeah.
- SGScott Galloway
The Suez Canal.
- KSKara Swisher
Right. Exactly.
- SGScott Galloway
And then freedom of navigation, a-a-again, see above, things we've taken for granted. Freedom of navigation was something that had been embraced by the entire world that said e-everyone's gonna pay more, everyone's gonna have insecure energy policy if we don't enforce freedom of navigation around the world. But you gotta think that every nation is thinking not only economically but from a defense standpoint, we need to have energy security. What is... All roads in energy security lead to one place, renewables. And let's talk about renewables. The advanced manufacturing and long-term thinking of China, get this, what is the global share that China controls of windmill production? Any guesses?
- KSKara Swisher
No, probably a lot. All of it.
- SGScott Galloway
A lot, correct. Sixty percent.
- KSKara Swisher
Mm-hmm.
- SGScott Galloway
The percentage of EVs sold glo-globally?
- KSKara Swisher
China.
- SGScott Galloway
Seventy percent.
- KSKara Swisher
Yeah.
- SGScott Galloway
China. The percentage [chuckles] of, uh-
- KSKara Swisher
Drones
- SGScott Galloway
... solar panels produced-
- KSKara Swisher
Drones
- SGScott Galloway
... in the world?
- KSKara Swisher
All of them. Drones. Sorry.
- SGScott Galloway
Eighty percent-
- KSKara Swisher
Yeah
- SGScott Galloway
... in China. So while we're sending diplomatic missions and Canada's announcing they're divorcing from us 'cause we're an absentee, irresponsible player in the marriageChina is using advanced manufacturing to say, "Okay, long term, everyone's gonna start investing in renewables, and we're gonna be the place they come to buy it all." And they're not only offering the manufacturing and the products, they're offering safe distribution, they're offering financing for these things, and they're saying, "You can count on us." So if you don't wanna be subject to the IRGC or President Trump's whims that day, enter into an economic relationship with China.
- KSKara Swisher
Yeah, I agree. I agree. Anyway, it's a real-- It's, it's just this is, this is not good from a political point of view, from a world point of view, and a lot of-- Like, there's a lot of very high-level people predicting a real collapse of lots of co- of, of countries in terms of because of the slowdowns and the problems, that they're just on the edge. I mean, uh, the UAE was asking for some money. This is-- They have to solve this yesterday. They shouldn't have done it in the first place, but now they have to solve it yesterday 'cause there's a lot of other coun- All these countries are interconnected. Whether you like it or not, MAGA folks, this is how it works, and you're gonna, you're gonna see collapses all around. If the UAE is asking for... What did, what did they want? They need money, Israeli, 'cause of the, the situation. All these luxury brands throughout the Mid East, and that's just small, small ball. It's like all these countries are dependent on this. And so he is reordering the world for sure, but not in a way that favors the United States. Uh, and of course, they're sending this team of Witkoff. Steve, Steve Witkoff. Honestly, this is not our best and brightest with Jared Kushner, Steve Witkoff, and J.D. Vance.
- SGScott Galloway
If you wanna understand what's gonna happen in a negotiation with Witkoff, just ask how is he gonna get his kids rich?
- KSKara Swisher
Mm-hmm.
- SGScott Galloway
Like, what-- That's essentially-
- 17:00 – 24:40
Joe Rogan Influences Executive Order
- KSKara Swisher
we're back with more news. Trump signed an executive order fast-tracking FDA review of psychedelic drugs like psilocybin and I think it's ibogaine for mental health treatment, all thanks to a text from Joe Rogan. Rogan texted Trump about ibogaine research in reducing opioid addiction, and the president immediately replied, "Sounds great. Do you want FDA approval? Let's do it." The order directs the FDA to expedite review of the breakthrough therapy and encourage data sharing between the Health and Veterans Affairs Department. Um, you know-Honestly, this... Look, Rogan's been turning on Trump, and this was a gimme to Joe Rogan. But I, I, as you know, I talk about psych- use of psychedelics in this series. It's very promising, but certainly shouldn't be expedited 'cause some, some, uh, podcaster who has very not the best information, 'cause they need to do the safety checks if these things are gonna be good for people. Um, but if... [chuckles] I mean, what, what would you text Trump for? What would you like if you could talk? But this is how it's done in this country. He texts him. He wants him back. It's the most thirsty and thirsty way to get Rogan's approval, and Rogan is dumb enough to take it and then shift on these things that he cared about, allegedly war and, um, the Epstein things, so the whole thing is just demented. I thought this was the most demented thing, given how important this psychedelic r- research should be taken throughout this country. Your thoughts?
- SGScott Galloway
Well, Ibogaine i- is, the... There's real potential here.
- KSKara Swisher
Absolutely.
- SGScott Galloway
A Stanford study found a single Ibogaine dose reduced veterans' disability ratings from 30.2 to 5.1, with effects sustained at least a month out. Almost nine in 10 participants experienced, um, a reduction in PTSD symptoms, nine in 10, uh, decrease in depression, eight in 10, uh, reduce in anxiety, so this has real potential. This is, this is a great move, but here's the problem. This isn't how you do things.
- KSKara Swisher
They've been running, they've been running this for a year. They could've done this a year ago, but go ahead. Go ahead.
- SGScott Galloway
Well, o- okay. So I'm a big believer in prison reform. I think they're... we're the most incarcerated nation in the world, and I think that a hugely accretive move would be, uh, early prison release and a review of, of people who are currently incarcerated. And when the Trump administration decides that it would be great to have the Karda- Kardashian on boards, and she, she takes this on as an issue, they then get a pardon.
- KSKara Swisher
One person.
- SGScott Galloway
Like, he does these things, but he does them for political reasons, and they're not systemic in nature. And when it comes to the... When it comes to taking something from a Class 2 or a Class 1 drug, I want someone who has domain expertise.
- KSKara Swisher
That's correct.
- SGScott Galloway
I want double-blind tests. I think the... Again, another thing [chuckles] we have taken for granted here is the good people at the CDC, our FDA, uh, double-blind studies, doctors with actual credentials. I mean, they do, they do a really good job. It's been a huge, uh, benefit to us economically. The drugs you take are... You know, they, they do mistakes, but you can feel fairly certain that if you take something that's FDA-approved, it's approved for-
- KSKara Swisher
It's also too slow
- SGScott Galloway
... a good reason, so-
- KSKara Swisher
Absolutely too slow-
- SGScott Galloway
I'm-
- KSKara Swisher
... on these therapies, but they're still early. And, uh, the fact that this very not smart podcaster, who's very lovely in some ways and nutty in some ways and, but doesn't operate in a factual environment all the time, is getting to get this because he's, was mean to Trump and was turning on him, and then for the next couple of months, he'll be nice to Trump, right? The whole thing is just grotesque in the-
- SGScott Galloway
And this is not good health policy
- KSKara Swisher
... this is not how we need to... This is not health policy. That's correct. It's not legal policy. It's, uh, it- it's, it's purely political. And for Rogan to get used like this on an important issue, maybe if it's important to him, he should demand that Trump, not, not just 'cause he can go to the Oval Office and hug Trump. But it's just, just... Oh, God. It could hurt veterans if it's not done correctly. The whole... Ay yai yai. Just... And it's, by the way, it's also gonna take forever.
- SGScott Galloway
So let's do this.
- KSKara Swisher
It's, like, also gonna take forever anyway.
- SGScott Galloway
Let's, let's-
- KSKara Swisher
Go ahead
- SGScott Galloway
... let's play the game.
- KSKara Swisher
Mm-hmm.
- SGScott Galloway
Let's be increasingly mean and grow our pa- platform 10X.
- KSKara Swisher
Mm.
- SGScott Galloway
And then what is the one thing you want from Trump? What is the one policy you would want from Trump?
- KSKara Swisher
$25 minimum wage.
- SGScott Galloway
Oh, I love that.
- KSKara Swisher
Universal healthcare.
- SGScott Galloway
I love that.
- 24:40 – 39:58
Anthropic Meets with The White House
- KSKara Swisher
which is kind of funny. Um, all right. The NSA is using Anthropic's, uh, Mythos even after the Department of Defense called the company a supply chain risk. Um, Anthropic CEO Dario Amodei met with the White House officials on Friday to work towards a compromise to bring the company's technology back to government use. Both sides described the meeting as productive. However, when President Trump was asked about Amodei's visit, he said he had no idea about the meeting. He was meeting with Susie Wiles. If a compromise is reached, it would likely exclude the Pentagon because Pete... uh, Hegseth is a moron, and so is Emil Michael, who works for him. Um, so it's t- again, it's like everyone, uh, everyone I have talked to in the other departments think the Hegseth thing is insane, and that they wanna use it 'cause it's a better model. So the NSA wants to use it, um, and everything else, and it's just, it's kind of ridiculous that Amodei has to go hat in hand to deal with these children. And by the way, over at OpenAI, more kind of problems. The company lost three executives on Friday, the leader of the defunct Sora, the VP of OpenAI for Science, who we used to work for Twitter, Kevin Weill, and the company's CTO for, uh, b-B2B applications. Um, so they're losing... There's a lot of... It's more, it's more, um, dramatic than Google back in the day or Twitter. It just... It's really quite a dramatic little company. Um, so any thoughts on Anthropic or OpenAI again?
- SGScott Galloway
Well, [sighs] you know, history or the world hates a vacuum, and one of the biggest vacuums or voids right now that's creating chaos is the vacuum around regulation and guardrails around AI. And when Dario Amodei, who is supposed to be head of a private company charged with just using every tool in his toolkit possible to create leverage and margin for shareholders, gets so worried about something that he pulls it back, and I'm not, you know... And so he's only gonna give it to JPMorgan and Apple, you know, the good guys. [chuckles] Um, and y-you'd like to think he's sincere about it, and he's generally concerned, but he shouldn't be making those calls. If we're trusting or hoping that the US and existential threats are gonna be dependent upon the kindness and wisdom of CEOs, we are fucked because these people have so many incentives-
- KSKara Swisher
I agree. It's a low bar
- SGScott Galloway
... and pressure to just deliver and ensure their value.
- KSKara Swisher
I was with some people. They-- I was with some people, and they're like, "Amodei's good." I'm like, "It's a low fucking bar," and I don't, still don't want him to decide. And still, you know, even at this point anyway.
- SGScott Galloway
But, m- but in, uh, one of millions of text chains I got copied on in between you and Rahm-
- KSKara Swisher
Mm-hmm
- SGScott Galloway
... I was gonna suggest to Rahm and any other Democratic presidential candidate, I was actually gonna, uh... For some reason, I think Jon Ossoff is, and you wrote about this, is giving off real presidential energy right now. But I think the opportunity among a Democratic can-candidate right now, quite frankly, is to have a very thoughtful, get some academics together, and have a very thoughtful ten-page or less summarized in a one or two page cover, cover, um, summary is, uh, regulation for AI. Do you realize no one's even proposing what it would mean? What does it look like? How do you regulate it? What i- is it about security? Is it about privacy? Is it about how do you thread the needle between regulation and also main-- letting our thoroughbreds run such that China does not get out ahead of us, which is a legitimate concern. Who running for president, i.e. you know, everyone, has put out anything thoughtful that has said... I mean, Senator Warner has put out something with Senator Hawley about retraining and trying to support job destruction, but no one has really put out a thoughtful, you know, three, five, twelve-point plan on this is what we should implement immediately and i- by executive order that lets the economic growth run mostly. It'll cost some economic growth, but gives people some level of certainty that the government has some feel around the risks here and outlines them, but there's nothing right now. It's just the Wild West, and that vacuum is being filled by a bunch of arguments, virtue signaling, false signals, comms releases, press releases. So the vacuum is being filled by chaos around something that people aren't sure is it a big threat? Is it, is it not?
- KSKara Swisher
I, I agree.
- SGScott Galloway
And it really hurts the industry 'cause see above, it's gone from nine in ten people being optimistic about this to one in ten.
- KSKara Swisher
Yeah, they've really fucked it up, and it's not the fault of, like, me complaining. That, I, I got that from one of them. It's like, "It's 'cause you're so negative." I'm like, "Get the fuck out of here." Like, it's not our fault. You know, I said that. That's what I actually said. Because I was-
- SGScott Galloway
I'm an influencer. [laughs]
- KSKara Swisher
I'm a big in... The indies agree with... You're right. It's worked, by the way.
- SGScott Galloway
I'm an influencer.
- KSKara Swisher
But, um, it was so weird. It was gone.
- SGScott Galloway
I'm an influencer.
- KSKara Swisher
I couldn't believe it. Anyway, um, it's just they have done it to themselves. They've done it to themselves because they're so... And you know what drove me crazy? Then you get... N- these, this isn't an, isn't an AI company, but it's all stuck in there, Palantir posting its manifesto on X over the weekend, which one outlet, uh, it was points from Alex Karp's, the CEO's book, The Technological Republic. One outlet likened it to the ramblings of a comic book villain, and the points include post-war neutering of Germany and Japan m-must be undone. I mean, it's already been undone, you dumbass. We should applaud those who attempt to build where the market failed to act, and we must resist shallow temptation of vacant and hollow pluralism. The whole thing is just w- so... I need them to shut up. I need all the AI people to shut up, even the good ones, and just, like, like, put in good things in place because they literally have-- they keep shooting themselves in the foot about a technology that'sPossibly dangerous, possibly amazing, and everybody hates it, right? Everyone who's normal hates it, not them, and then they blame us for that.
- SGScott Galloway
Yeah, I don't get it, and I, I consider myself an influencer, but I suffer from paranoia. I believe that nobody is following me.
- KSKara Swisher
[laughs] Can I ask you, if you went in there to them, they said, "Scott Galloway, we need, we need you to fix this," what would be your first three moves? Mr. Brand, we're having you in. We're paying you a ba-dillion dollars 'cause they haven't been-
- SGScott Galloway
For AI?
- KSKara Swisher
Yeah. The AI companies are like, "Look-
- SGScott Galloway
The AI?
- KSKara Swisher
... people fucking hate us."
- SGScott Galloway
Yeah. I'd wanna, I'd wanna-
- KSKara Swisher
Three things
- SGScott Galloway
... I'd wanna assemble a list of technologists, ethicists, and economic advisors, and I'd want-- I would demand a 30-day, uh, period where no model, no updated model is ever released without thorough review that, that A/B tests the shit out of the thing in terms of existential risks, and it has s- if the F- if it takes fucking a decade to get a drug through the FDA-
- KSKara Swisher
Right, exactly
- SGScott Galloway
... why wouldn't we mandate that the government gets to play with any new model for 30 days?
- KSKara Swisher
Mm-hmm.
- SGScott Galloway
And then says, "We have found that this could absolutely hack the NSA-
- 39:58 – 45:25
Netflix Earnings
- KSKara Swisher
Scott, we're back with more news. Netflix is out with its first earnings report since walking away from the Warner Brothers deal back in February. The company beat expectations on revenue and earnings, driven by membership growth, ad sales, and higher subscription prices, plus that two point eight billion dollar breakup fee. Thanks, uh, Ellison. Thanks, Paramount. But the Q2 forecast was below analyst expectations. It sent shares down ten percent. The earnings also came with a few announcements, a deeper push into AI, and the launch of a TikTok-like vertical video feed within the app. They're trying to do a lot more. AI makes total sense in that regard. And notably, Netflix co-founder and chairman of the board, Reed Hastings, is leaving the company when his term expires in June. He wants to do a lot of other things. Um, talk first about the earnings. We're gonna get into the Netflix's podcast plans in a, in just a second. Um, I can go over what they're doing, but why don't you talk about the earnings themself? And by the way, can I just take a moment? I met Reed Hastings right at the beginning of this company, and I have known him for a long time. I gotta say, an amazing entrepreneur. What he did and shifted deserves enormous credit, and he was the, the real engine. And Ted is doing a great job, so is Bela Bajaria, so are the new people there. But Reed Hastings is one-- is a generational, uh, entrepreneur, and congratulations on your tenure.
- SGScott Galloway
Yeah, agreed. Uh, look, their earnings were, uh, fantastic. Their revenue was up sixteen percent year over year, beating expectations. Their earnings, uh, was nearly double what analysts expected. There was a bit of a sugar high though because of the three billion dollar termination fee from the collapsed Warner Brothers deal. What shocked me was the ad tier now drives over sixty percent of new signups-
- KSKara Swisher
Yeah
- SGScott Galloway
... in ad-supported markets.
- KSKara Swisher
Interesting.
- SGScott Galloway
Um, and, uh, they're, they're on track to hit three billion dollars in ad revenue this year, so now they're becoming a big media player-
- KSKara Swisher
They are
- SGScott Galloway
... ad-supported media player with a business that barely even existed two years ago. And the full year guidance held at about fifty-one to fifty-two billion, but, uh, Q2 guidance of thirteen percent growth came in below what the bulls wanted to see. So I think that... I guess I, I looked at these earnings. I mean, this is the weird and the beautiful thing about the market. If I'd seen these earnings before the market's reaction, I would have guessed the market would be flat to up. So I don't know if they're taking Reed's departure as a signal this is no longer a growth company or that the, just some air was coming out of the stock. Um, I don't get it. I don't, uh, you know, I... There was some speculation that Reed was leaving because of the botched Warner Brothers deal. I think that's bullshit. I think, like you said, he just wants to do different things.
- KSKara Swisher
He has a lot of stuff he's working on.
- SGScott Galloway
The stock was up eighteen percent year to date h-heading into the print. Now it's just up seven percent, but that's not bad. TheI did meet with Ted Sarandos two years ago, and I told him I thought they should launch a TikTok competitor because the long tail of Netflix content doesn't get viewed very much.
- KSKara Swisher
Yeah, just like you were talking.
- SGScott Galloway
And I thought have an open source opportunity for artists and creators to slice it up, and it would be incredible marketing, and I think they could have a viable competitor to TikTok.
- KSKara Swisher
Yeah.
- SGScott Galloway
And at that point, he said, "Well, TikTok is a marketing-"
- KSKara Swisher
I would trust them with that. I would trust them, by the way.
- SGScott Galloway
It looks like they're getting into the business. Um, they're launching a TikTok style vertical video feed this month, and YouTube has thirteen percent of all US TV viewing versus Netflix at nine percent, but YouTube Shorts has grown a hundred and eighty-six percent in fifteen months, with Shorts on connected TV accounting for part of their growth. And then Meta recently announced that Reels for TV, uh, they're doing Reels for TV, where users can watch short-form content on television, and Reels already has a fifty billion dollar annual run rate in ad revenue. That's more revenue than WBD and NBC Universal combined. And basically everyone now, ninety-five percent of consumers now watch some sh- some form of short-form video.
- KSKara Swisher
Kara Swisher, don't you?
- SGScott Galloway
Oh, I, I, I hate to admit it. Most of-
- KSKara Swisher
Mm-hmm.
- SGScott Galloway
People ask me what my media sources were, and I used to say the FT and The Economist to sound smart. The bottom line is, I'm getting most of my content from short-form video right now.
- KSKara Swisher
Me too. Me too.
- SGScott Galloway
And time spent watching video content on social media has more than doubled since the pandemic, and Meta's revenues have nearly tripled and TikTok's have grown tenfold. So I think that the, what, what Netflix has is they have proprietary content, so proprietary content that's not user generated but user edited. What could you do? There's some, been some amazing Netflix content that never bubbles up and never gets seen. Put it out and say, "Guys, have at it. S-slice it into two-minute things. Create new stories. Add in different effects. Add in different humor, different subtitles. Have at it." Uh, my, my, what I pitched, what I pitched, um, uh, uh, Ted, I'm like, "Start something called Netvibes-
- KSKara Swisher
Oh
- SGScott Galloway
... and basically say it's a TikTok competitor with all the proprietary content of the long tail stuff-
- KSKara Swisher
I love that, Scott
- SGScott Galloway
... the ninety percent that gets two percent of your viewership time."
- KSKara Swisher
Why did you just give away that great name?
- SGScott Galloway
Uh-
- KSKara Swisher
That was really good. You're talented. That was good. You've said two very smart things today.
- SGScott Galloway
It's-
- 45:25 – 56:22
Streaming Bets on Podcasts
- KSKara Swisher
you, the second thing is they're going all in on podcasts, which is interesting, um, and I have a lot of information about this 'cause I immediately started looking into it. Netflix has announced five more shows coming to its platforms. These are exclusive shows, including a new weekly interview show with Brian Williams. Hulu has also announced four more podcasts, including Handsome and three others based on TV shows. Hulu's, um, d- is not as strict, um, as Netflix. Netflix requires the shows to forgo YouTube entirely, and Hulu does not, it looks like. Um, so this is really interesting. So I asked what the deals were, and someone said, "Deal structure looks like this: episodic fee, low end of twenty-five K an episode, averaging, average range fifty to seventy-five K an episode, higher celeb for celeb talent. Uh, production budget on top, six to twelve-month initial terms with twenty-six to fifty-two episodes, depending on term length, ownership Netflix, but sometimes they are given, um, uh, revision rights, uh, uh, reversion rights, excuse me." So IP maybe, if they're making them. Um, I wasn't tremendously impressed with the choices they made. I like Brian Williams, but it, it seems like they should really go for a much more, um, younger demo, I guess, or more online demo, influencer demo, but that was just me. Um, what are your thoughts here? What do you think? That's a lot of money. Fifty, you know, if you got fifty thousand dollars an episode, that's, that's a buttload of money. Two point five million dollars a year.
- SGScott Galloway
Well, we've been talking our own book, but it doesn't mean I don't believe it. Uh, every political cycle, there's a technology. Uh, Obama weaponized search, um, Trump, Facebook. I would say the second one was about social. A lot of people would say this is now, these midterms are gonna be AI midterms with a ton of misinformation. But I think in general, this election or the last election was really the podcast election. And do you remember that graph that showed that newspapers were getting thirty percent of all ad revenue, but they only had eight percent readership, and the internet was getting ten percent of revenue but had fifty percent of all time? Those two tend to calibrate, and the fastest growing ad-supported medium in the nation is not Meta or Alphabet, it's podcasting.
- KSKara Swisher
Mm-hmm.
- SGScott Galloway
Uh-
- KSKara Swisher
Which is video casting, really, but go ahead.
- SGScott Galloway
It's, it's television with a lower-
- KSKara Swisher
Television
- SGScott Galloway
... cost of means of production.
- KSKara Swisher
Mm-hmm.
- SGScott Galloway
It's eighty percent of TV-
- KSKara Swisher
And, and a closer relationship with fans that you have, you can't leave that out. It's not just 'cause it's cheap.
- SGScott Galloway
And it's, and it's not starched. It's, it's not, it's not a handsome guy saying, "Save content for twenty-two minutes," and then showing a video about a butterfly garden. Uh, it's just, it's people who are willing... And some people like the conspiracy shit, and some people want people calling Hegseth a, a drunk. It, it, and sometimes people are just so fucking talented that they bubble up past the means of production that have sequestered some of this talent. A-anyways, podcasting, you know, the Golden Globes now has it as, as a category. Um, we're up. Pivot is up twenty-five or thirty percent this year. Property media is up forty-six percent this year. Podcasts are growing like crazy, and what's, what's even more interesting is the, the chaser effects are the following: the average age of a Fox viewer is sixty-nine, CNN sixty-seven, CNBC sixty-four. The average podcast listener is thirty-four.And when you're thirty-four, it means you're, you're buying houses, cars, getting kids, which are very expensive, and dogs so this is, this is, quote-unquote, the core demographic so in, and in addition, as evidenced by the fact that e- the easiest guest for Kara Swisher and Scott Galloway to get on their show-
- KSKara Swisher
Mm-hmm
- SGScott Galloway
... is someone running for president.
- KSKara Swisher
Yeah. Oh, they were calling me all the time.
- SGScott Galloway
We can call anyone who's thinking, quote-unquote, not gonna make the decision in a year or two year with their family. Yeah.
- KSKara Swisher
Mm-hmm.
- SGScott Galloway
They're calling us, and they wanna come on because they're running for president.
- KSKara Swisher
I get so many messages right now.
- SGScott Galloway
Because, because the, what's interesting is that, you know, I don't know if you found this, but on Prop two, they don't perform that well. I find that really interesting.
- KSKara Swisher
Some of them do.
- SGScott Galloway
But more interesting, I-
- KSKara Swisher
Buttigieg did great, I'll tell you that. Newsom did very well.
- SGScott Galloway
He's exceptional.
- KSKara Swisher
Well, Newsom did really well.
- SGScott Galloway
He's, he's exceptional.
- KSKara Swisher
That's not true. It's not true. Some of them do well. It depend... I'm, I'm gonna, I'm gonna pay attention to what does well, which is interesting.
- SGScott Galloway
I find on average, politicians don't score nearly as well as some of the other guests we have. But anyways-
- KSKara Swisher
Maybe your audience
- SGScott Galloway
... uh, in terms of downloads or viewership, but my point is, the new, uh, people actually listen to the ads. The other innovation that no traditional media company wanted to do because they decided their talent was too precious is host read overs. That gets... If you do a, if you just do an insert ad on YouTube or just an insert ad, you get between three and ten bucks CPMs. You reading over an ad, you talking about your Chevy Bolt and how much you like it, which you really do-
- 56:22 – 1:06:20
Wins and Fails
- KSKara Swisher
Okay, Scott, we're gonna do some wins and fails. I'm gonna, I'm gonna go first, if you don't mind. I already talked about Palantir's stupid manifesto, but two people, um, Ron Conway, a really well-known figure in Silicon Valley, who I like very much. He was the one that was pushing back on... He's been-- I just really like him. He and I have had lots of beefs over the years, but he's a really legendary venture capitalist. He announced he had a cancer. He's not giving specifics about it, um, and he's fighting it. He's given so much money to medical stuff in San Francisco, incredibly generous and unusual for a lot of these VCs who just only think about themselves, but Ron's a very civic-minded person in San Francisco. Um, and people have different views with him, but I l- I really adore him, and, uh, he's, he's struggling with some cancer, and he wrote me a series of very joyful texts over the weekend. "I love you. Thank you so much," uh, 'cause I wrote him a note, and I just hope he, he has all the, he has all the money and, uh, to, to do and all the connections in science 'cause he's done so much fundraising. Um, I hope the, for the best for him. And the second one is, um, so that's a fail for mine, and same thing is, uh, Senator Warner's daughter died. Uh, she had juvenile diabetes and a series of health issues, and I, both Scott and I love talking to him. We find him very thoughtful. Um, and so I just, we are, my condolences go to him. Um, she's thirty-six years old and again struggled with, um, struggled with juvenile diabetes and ensuing bunches of issues. Um, and my win, um, is this Atlantic piece. It's a little bit of a dunker, but, uh, e-everyone is getting on board with this idea that maybe the tech billionaires aren't here to help us, which I think, um, is, is a, is a narrative I've tried to get through [chuckles] a little bit. Um, but I thought that this guy, Noah Hawley, who was responsible for Fargo and a bunch of other things I love o-online, he's been writing for The Atlantic, and I just really, really enjoy, uh, his work. Um, but I really, uh... L-let me just read two quotes from this piece in The Atlantic. Uh, it's called What I Learned About Billionaires at Jeff Bezos's Private Retreat. These guys are having their own retreats. The, the Bezos's is called Campfire, and it's, it's a devastating piece actually, and I think very true and fair. Um, "This is the hubris of accomplishment. To be declared a genius at one thing is to begin to believe you are a genius at everything. It's not that the wealthy become evil, it's that their environment stops teaching them the things that non-wealthy people are forced to learn simply by living in a world that pushes back. When, when you can buy your way out of any mistake, when you can fire s- anyone who disagrees with you, when your social circle consists entirely of people who need something from you, the basic mechanism by which humans learn that other people are real goes dark." Fantastic piece, Noah Hawley. I recommend it. It's beautifully written and incredibly fair and, um, so anyway. Yours?
- SGScott Galloway
I'm just gonna, I'm just parroting your comments. I did not know that about Ron Conway, and I'm sorry to hear that. Ron invested, uh, in two of my companies back in the '90s when I was playing in traffic and starting e-commerce companies. He invested-- He was one of my first investors in Red Envelope and one of my first investors in my e-commerce incubator, Brandfarm.
- KSKara Swisher
Oh, I didn't know that. Wow.
- SGScott Galloway
Yeah. And I'll say this about Ron, you know, you have good investors, and you have bad investors, and Ron, uh, I would just describe as incredibly supportive. No matter what was going on, was emotionally and financially just, like, really on the side of entrepreneurs. And, uh-
- KSKara Swisher
Mm-hmm. Very much so
- SGScott Galloway
... I'm sorry to hear that, and I share, I share your warm wishes. Also share your condolences and sympathies with Senator Warner. Obviously, every parent's-
- KSKara Swisher
Oh
- SGScott Galloway
... worst nightmare. Uh, I'm not-- I, I know Senator Warner. I would consider myself friendly, but I'm not close friends with him, but I have a close friend who's very close with Senator Warner. And the senator has been approached by any number of people on a regular basis, uh, about running for president, and a lot of people felt that he brought the gravitas, the credentials, and quite frankly, the kind of moder- the moderate positioning that they thought would be, uh, a great candidate for president. And, uh, what I have heard is that he, he never, ever s- ever seriously concern- uh, considered it because he was always very focused on his family. Uh, so he is that guy, not the one who's performative, "Oh, I'm gonna check with my family." He was, oftentimes, people wanted to draft him, but he was always kind of, uh, family first. Anyways, I share your, share your, uh, condolences.My, my win is much more boring. I just wanted to talk a little bit about Reed Hastings and just the incredible tenure, n- uh, ninety-nine to twenty twenty-three. Founded in nineteen ninety-seven, so he's there thirty years. So you wanna talk about, uh, from a startup to global giant. In two thousand, they had three hundred thousand subscribers.
- KSKara Swisher
Mm-hmm.
- SGScott Galloway
This year, they'll have three hundred million. [chuckles]
- KSKara Swisher
I was saying-
- SGScott Galloway
The revenue went from-
- KSKara Swisher
Money
- SGScott Galloway
... the revenue went from three billion in twenty eleven. This year, it will do forty-five billion. In terms of market value, they rejected a fifty million dollar acquisition offer in two thousand. This year, they'll-- they're now worth about four hundred billion, um, one of the largest value creations in tech history. In terms of business transformation, talk about the mother of all, you know, big, bold pivots from DVD rentals to streaming in two thousand and seven, from streaming to original content, House of Cards, and then he's gone from the US to a hundred and ninety-plus countries globally. Their profitability, tons of losses in the two thousands, multi-billions in annual profits. And then the cultural impact, uh, uh, that people don't talk enough about was that Netflix deck they put out on their culture. They talk about freedom and responsibility, no vacation limits, high-performance culture, and the thing-- I did actually take something from them. They stated out loud that they wanted to be a company known for exceptional compensation, and I've, I've tried to adopt the same thing. I've always tried to pay my people more than market, or I should say always, the last ten years. Uh, but this company, um, they took-
- KSKara Swisher
Amazing
- SGScott Galloway
... a DVD-by-mail startup, they pivoted into streaming, they scaled it globally, and they turned it into a half a trillion dollar media platform. Thirty years, one thousand x user growth, fifteen x revenue growth, and, you know, uh, uh, uh, redefined or defined the category. Uh, I would argue one of the top five to ten tech CEO careers of the last thirty years. And you know what? He did it with a lot of grace. He was never in-
- KSKara Swisher
Grace. Oh, absolutely.
- SGScott Galloway
He was never a scandal, never shit-posting other people, never-
- KSKara Swisher
Mm-hmm
- SGScott Galloway
... found drunk driving, never b- shitty tweets he had to erase or delete.
- KSKara Swisher
Never attention on himself.
- SGScott Galloway
You know, just-
- KSKara Swisher
I have to-
- SGScott Galloway
Yeah.
- KSKara Swisher
I-- Can I just add that? I've had him on stage many times, but I have to say, of all the people, I would rather spend time with Reed Hastings. And I know Hollywood all hates their system, but it's not their fault that they found a way to do a different system. It's Hollywood's fault for having a bad economic system that was no longer sustainable. They like to sort of blame Netflix. I think that's unfair. Um, they, they do what they do. That's what they make, and I don't think they're diminishing it. You just... You don't have to watch it if you don't like it in that regard. And I think they put out a lot of great content, actually. They put out a lot of silly content, too. But I gotta tell ya, what a c- he's a fucking class act. He's... So is Ron. They're class acts, all these guys you're talking about.
- SGScott Galloway
And he clearly imprinted really solid DNA. The co-CEOs now, Greg Peters and Ted Sarandos, I don't know Greg, but I know Ted, but they're both-
- KSKara Swisher
Good guys
- SGScott Galloway
... have a reputation for being not only very intelligent, but very decent men. So Netflix, a great company, great leadership, and this guy's-
- KSKara Swisher
Agree
- SGScott Galloway
... historic run is, is historic.
Episode duration: 1:06:21
Install uListen for AI-powered chat & search across the full episode — Get Full Transcript
Transcript of episode 1qgFJUrawgY
Get more out of YouTube videos.
High quality summaries for YouTube videos. Accurate transcripts to search & find moments. Powered by ChatGPT & Claude AI.
Add to Chrome