Mark Zuckerberg Is Coming for Prediction Markets. Kara Swisher Calls Him Out | Pivot

1. 0:00 – 2:34

   Intro

   1. SGScott Galloway0:00

      You love me.

   2. KSKara Swisher0:00

      I do.

   3. SGScott Galloway0:01

      You love the dog.

   4. KSKara Swisher0:02

      Uh, sadly, sadly, sadly. It's the worst relationship of my life, and my finest, uh-

   5. SGScott Galloway0:06

      Ah, come on. [upbeat music]

   6. KSKara Swisher0:13

      Hi, everyone. This is Pivot from New York Magazine and the Vox Media Podcast Network. I'm Kara Swisher.

   7. SGScott Galloway0:18

      And I'm Scott Galloway. [audience cheering]

   8. KSKara Swisher0:21

      And, whoo! Oh, nice. [laughs] Wow, that was really good. And we're recording this episode in front of a live audience here at the ADWEEK House at Cannes L- uh, Cant, Cant, sorry, Cannes Lions International Festival of Creativity. Is that what it's called? All right, fine, we're doing that. Welcome, everybody. [audience cheering] So let's just start. Scott, I, we haven't seen each other at all, correct? Not even slightly.

   9. SGScott Galloway0:47

      Yeah, no, it's, it's a great Can- I mean, I, we'd love to see you.

   10. KSKara Swisher0:50

       It's a great Cannes for both of us, that we don't have to see each other.

   11. SGScott Galloway0:52

       Yeah, yeah, yeah.

   12. KSKara Swisher0:52

       Um, I brought my children. We're having a lovely time. They were just in the Me- Mediterranean this morning. Um, and I've had a lovely time with them, except for the heat. But how is your Cannes going? T- Cannes, sorry, Jesus Christ.

   13. SGScott Galloway1:04

       I love it here. Um, but I don't know if you saw that crazy drone show.

   14. KSKara Swisher1:09

       Yeah, that was, uh, uh, Cargo.

   15. SGScott Galloway1:10

       Cargo.

   16. KSKara Swisher1:11

       Yeah.

   17. SGScott Galloway1:11

       It's actually, the word is, and I can validate this, it's an alien craft. It's an alien species of, uh, species of women who are, no joke, are abducting guys with enormous dicks.

   18. KSKara Swisher1:24

       [laughs]

   19. SGScott Galloway1:25

       Um, so you're safe.

   20. KSKara Swisher1:27

       [laughs]

   21. SGScott Galloway1:28

       But also, just so you know, the spaceship is incredible.

   22. KSKara Swisher1:31

       Oh, yeah. [laughs] Whoo.

   23. SGScott Galloway1:34

       Hello, France.

   24. KSKara Swisher1:37

       [audience clapping] Whoo. That took, like, five seconds to get to a penis joke. [laughs] And a highly complimentary one to yourself, which is inaccurate. But- [laughs] Nonetheless...

   25. SGScott Galloway1:47

       Don't ask me my nickname in a fraternity. Just don't. Just don't.

   26. KSKara Swisher1:51

       Okay.

   27. SGScott Galloway1:51

       Trey Pod.

   28. KSKara Swisher1:52

       Yeah.

   29. SGScott Galloway1:52

       Tripod.

   30. KSKara Swisher1:53

       [laughs]
2. 2:34 – 6:00

   The Creator Economy

   1. KSKara Swisher2:34

      think are the big takeaways so far?

   2. SGScott Galloway2:36

      So, uh, hands down, the biggest trend is the creator economy. There's 500 here this year. There were 400 last year. It used to be ab- it's sort of ironic that this is meant to be a gathering. It's 13,000 people from 90 countries. It's meant to be a gathering to celebrate the industry. But the industry hasn't yet recognized they're no longer the protagonist, and that the industry, if you think of it in the means of production, talent used to command 10 or 15% of the total revenue. Because in between there were these means of production or moats. An ad agency, a distribution, a studio, makeup, unions, a cable going into people's homes. And now people with these few platforms that command a disproportionate margin, they do really well. But you have thousands, it's no longer Madison Avenue, it's a bunch of studios. And the celebrities here are no longer... When I used to come here, Maurice Levy, Martin Sorrell, John Wren, they owned the Croisette.

   3. KSKara Swisher3:32

      Mm-hmm.

   4. SGScott Galloway3:32

      Now it's some creator who's talking about food, you know? So it's, it really has, there's a distribution from institutions to individuals. Uh, AI, last year, it was what do we do with AI? Now it's how do we organize our company around AI and how do we get an ROI there?

   5. KSKara Swisher3:49

      Mm-hmm.

   6. SGScott Galloway3:50

      I think there's been, people have come to the conclusion that AI is all chip and no salsa, and that creativity's never been more important. Where social media takes people to the extremes, AI takes everyone to the middle, and it's very moderated. And so creativity's never been more important. Remember, AI was gonna produce commercials. There's more designers now at IBM as a percentage of their employment in creatives than there was last year. So creativity appears to have made a comeback.

   7. KSKara Swisher4:15

      Yeah, I have noticed the sort of falloff in the AI dementia that was here last year.

   8. SGScott Galloway4:20

      Yeah.

   9. KSKara Swisher4:20

      I mean, it's really, I mean, it's, that's, that's everywhere, actually, when every- everyone's sort of coming to the conclusion that they're not really clear what efficacy this stuff has, instead of having to... I mean, the drone show did do A- AI, and it was, it was not AI, it was, it wasn't artificial intelligence, it was something else. They had another word. Uh, what it was? Art and intelligence. Art and intelligence instead of artificial intelligence. [laughs]

   10. SGScott Galloway4:46

       Yeah, and the other, and the other big trend is sports.

   11. KSKara Swisher4:48

       Yeah.

   12. SGScott Galloway4:48

       There wasn't a sport beach here. Sport really is the culture or religion now.

   13. KSKara Swisher4:52

       Yeah.

   14. SGScott Galloway4:52

       And it's, it's one of the, uh... I mean, the biggest, uh, I think the two biggest stories taking place right now, one's positive and one's negative, and the things we'll be talking about in two weeks, I like to predict what'll be the biggest business stories that are happening. The biggest cultural story would be the coming together, that basically the World Cup is doing what the UN was supposed to do. And these wonderful creators and this content that makes us feel better about the world when we really needed it, we needed to feel better about America and Waffle House and how wonderful Norwegians and the Scottish are.

   15. KSKara Swisher5:20

       Yeah.

   16. SGScott Galloway5:20

       Go Team Scotland against Brazil, it could happen tomorrow night.

   17. KSKara Swisher5:23

       Mm-hmm. [laughs]

   18. SGScott Galloway5:24

       Um, that is the best cultural story unfolding right now. The biggest story that will, that's taking place right now, you're going to see that the predictions markets have a scary fucking amount of betting on the World Cup right now, mostly from young men whose prefrontal cortices is very immature and are prone to addiction. I think that's the biggest story playing out right now. You're gonna see that one third, two thirds of young men in the United States bet on the World Cup, and you're gonna see Polymarket and Kalshi basically show the kind of numbers that get Goldman and JPMorgan saying, "We're ready to go public."

   19. KSKara Swisher5:59

       Yeah.

   20. SGScott Galloway5:59

       That's the biggest

3. 6:00 – 8:57

   Meta’s Prediction Market App

   1. SGScott Galloway6:00

      story playing out right now.

   2. KSKara Swisher6:00

      You did see, of course, Zuckerberg wading into it.

   3. SGScott Galloway6:02

      He's gonna start a predictions market.

   4. KSKara Swisher6:04

      He is, which is called Arena. Which, I mean, it, did he ever have an idea he thought of himself that he didn't th- thieve?

   5. SGScott Galloway6:11

      Yeah, but that's the key to shareholder value.

   6. KSKara Swisher6:13

      Yeah.

   7. SGScott Galloway6:13

      The innovator, the first iPod, the first computer, the first social media network.

   8. KSKara Swisher6:17

      Yeah.

   9. SGScott Galloway6:17

      Who's on MySpace? I mean, it's It, it's the second mouse that gets the cheese. Apple's, App-

   10. KSKara Swisher6:22

       Well, do you, do you imagine, 'cause he tried it in a number of ways. They tried to do a dating service. Do you remember the Facebook dating service that didn't go anywhere?

   11. SGScott Galloway6:30

       Oh, sure.

   12. KSKara Swisher6:30

       Or the Facebook this, the Facebook that. Is this a good area? You're just ... It, it's an important area right now, but they're also under enormous scrutiny by even in the ... By US standards, they're under enormous scrutiny in the US, all these markets. They're getting pushback all across the world from a regulatory point of view. And then M- Mark, whose reputation is just even this week got even more tarnished. We talked about it on the last episode, 'cause Trump essentially called him a sucker. Um, he did. Uh, he did, essentially, um, and was accurate. Um, and do you think it's a great time to wade into this area for a company like Facebook, or do you think these are inevitable companies that these, that are happening?

   13. SGScott Galloway7:13

       Yeah, I think, so if I were the head of corporate development at Meta, I would take a 2 to 3% dilution and take a 40 to $60 billion flyer on either Kalshi or Polymarket-

   14. KSKara Swisher7:23

       Mm-hmm

   15. SGScott Galloway7:23

       ... as opposed to trying to compete with them and go from letter A to F. But we use the term innovation really promiscuously. In terms of shareholder value, it's not the innovator. The innovator and the pioneers get mud on their face and arrows in their back. It's the number two. Apple has never invented anything. What they do is they come in and they commercialize it, and they do a better job of it. Uh, if I were Meta, and I'm not, and I would be rushing to get things done before a Democrat takes the White House and actually starts trying to break up companies, which is what we need to bring affordability down as the rents being charged on advertisers and consumers and parents gets higher and higher as we let these companies consolidate with no regulation. But I would, I would be looking at everything, and if I wanted to get into that market, I would pick up one of those two players for 20 to 60 billion, which at this point would be a minor dilution and-

   16. KSKara Swisher8:12

       Is it a particularly good thing for their corporate image to go into an area that's under ... It, it's clearly gonna be under attack in the next two years.

   17. SGScott Galloway8:19

       I don't think they give a shit.

   18. KSKara Swisher8:20

       Yeah, that's true.

   19. SGScott Galloway8:20

       I don't think they're worried about their image.

   20. KSKara Swisher8:22

       Yeah.

   21. SGScott Galloway8:22

       I don't.

   22. KSKara Swisher8:22

       Yeah. Yeah.

   23. SGScott Galloway8:23

       I mean, there's, as we sit here, there's a bunch of 14-year-old girls self-cutting because of Sheryl Sandberg's business model.

   24. KSKara Swisher8:30

       Right. Oh.

   25. SGScott Galloway8:30

       And... Too much?

   26. KSKara Swisher8:32

       Yeah.

   27. SGScott Galloway8:33

       Uh, so I don't-

   28. KSKara Swisher8:33

       The room is quiet

   29. SGScott Galloway8:34

       ... I don't, I think they're, I think they're very willing to endure hits to their image. I don't think that's their first priority.

   30. KSKara Swisher8:40

       So they will go, this is an area they should go into.
4. 8:57 – 20:51

   Europe Breaking Up with U.S. Big Tech

   1. KSKara Swisher8:57

      to break up, uh, US big tech. Here in France, the budget minister called for a country to break free of American systems, sort of on trend with the Europeans feeling the American century is over, which I think is very clear. They've stepped up in, uh, Ukraine. They've sort of pulled away from the US. You have Giorgia Meloni every day insulting Trump, which is really enjoyable. Um, uh, and the EU just rolled out a new sovereignty package to boost homegrown tech, a very difficult thing to do. Google, Microsoft, and Amazon control 70% of Europe's cloud market, and 80% of European software spend goes to US companies. Um, y- you know, it also has to deal with these climate goals that they have in data center. Uh, a, lobbyists say Europeans' power grid isn't ready to fuel advanced AI infrastructure, will need to lean on new gas plants to stay competitive, which is a big issue in the United States, and actually gaining enormous amount of traction with voters, 100%. Um, Europe's biggest tech CEOs, uh, want a say in shaping EU policy. A new group called the European Tech Creators is pushing the EU to cut red tape, loosen merger rules the way the US and China cut back theirs. Um, is that something you see happening? This is not the direction Europe had gone in and has had much less success, obviously. All these US companies, whether it's OpenAI or, or, or Anthropic, are all US co- all, the latest basket of them, whether they're gonna make it or not, are US companies.

   2. SGScott Galloway10:21

      Yeah. So America used to be the uncle who showed up, who was obnoxious. He showed up to the European, you know, picnic, obnoxious but nice, paid for your kids' tuition, generally heart was in the right place. Now the uncle's showing up, he's on meth, and he's doing his karate moves, and he's hitting on-

   3. KSKara Swisher10:36

      [laughs]

   4. SGScott Galloway10:37

      ... and he's hitting on underage girls at the par- I mean, we are, we have become so unreliable and, quite frankly, just gross, that the EU has finally come to the realization we can't count on this guy any longer.

   5. KSKara Swisher10:48

      Right.

   6. SGScott Galloway10:49

      And it, it can go one of two ways. The good way is that they figure out a way. Germany are, I think, 30, 40% debt to GDP. Uh, Netherlands, they need to probably go into some deficit spending, ramp up their technology investment in their own military, support their own companies, Mistral, Vertical Aerospace. Daniel Ek is, in a big investor in a European defense company. I think that would be good. If they use this as yet another excuse to slow down their thoroughbreds with over-regulation, which is what Europe does, you'll great, be righteous, worried about the environment, and we'll kick your ass from a shareholder standpoint. And that's the story of Europe, thoughtful regulation that gets in the way of every company killing it. And America makes the mistake of under-regulating. Europe makes the mistake of over-regulating, and you'd rather be the former because then you have the capital and the strength to fund a navy when you do get a good leader in place. Economic growth, I mean, it, it's kind of everything. You, you have to have... The UK has its heart in the right place, super smart, and they can't do any of this shit because the economy's not growing. So there's a medium. If they use it as an excuse to support, to force companies to purchase their own models, support European-born native internet, e-commerce, AI companies, defense companies, great. If they use it as yet another excuse to increase regulation where talented entrepreneurs and capital just-

   7. KSKara Swisher12:15

      Right. Right

   8. SGScott Galloway12:15

      ... shrug their arms and leave-

   9. KSKara Swisher12:16

      But i- is it even possible at this point? Because these companies are sort of barreling to IPOs, despite the fact that, for example, SpaceX has really taken yet another fall. We talked on Monday about this, but it took a, it took a decent fall again.

   10. SGScott Galloway12:28

       It's still up from the IPO.

   11. KSKara Swisher12:30

       Yeah.

   12. SGScott Galloway12:30

       It's trading at 120 times revenues.

   13. KSKara Swisher12:32

       Yeah.

   14. SGScott Galloway12:32

       We would kill for their problems.

   15. KSKara Swisher12:33

       Yeah, I get that. But do you see it, um- Is there a way to catch up in any way for other parts of the world to do so, or are these the companies that will-

   16. SGScott Galloway12:44

       Well, eh, Europe, Europe has some great companies, and I'm... Actually, in my prediction I'm gonna talk about, I think the hottest IPO of the digital of, of, of this month is actually gonna be a European company, and I'll talk about that in our predictions. Look, they have some, they have some great companies. The- I do think there's going to be a lot of talent. The team with the best players wins, and I think you're gonna see a trend where the most talented people in Europe used to have one goal: get out. It's like my homeland or my father's homeland, Scotland, my dad used to joke, "What do the most talented people in Scotland have in common? They left." And I do think that the rivers of flow of human capital benefit Europe right now. I think there's a lot of people are thinking, "You know what? Maybe I'll put off going to the Bay Area. Maybe I'll put off going to the Gulf, uh, moving." The most youn- the youngest, talented, most aggressive, ambitious people used to get to the biggest city in their nation, then to London, and then to San Francisco or New York. I think a lot of human capital and financial capital's gonna come back to Europe 'cause of lifestyle, and two, because Europe has been left for dead. The valuations are really low-

   17. KSKara Swisher13:47

       So they're low.

   18. SGScott Galloway13:47

       Yeah.

   19. KSKara Swisher13:47

       So you can take advantage of this.

   20. SGScott Galloway13:49

       I think so.

   21. KSKara Swisher13:49

       But it- they've gotta have a government that gets out of the way in some fash- although not to the extent that ours does, presumably.

   22. SGScott Galloway13:56

       There's gotta be a sweet spot. We've gone too far to free markets. The EU is way too overre- I mean, the European Union, it's not a union, it's a dis-union where nobody has control, but everyone has veto authority.

   23. KSKara Swisher14:07

       Right.

   24. SGScott Galloway14:08

       And it creates just, eh, eh, it supposedly takes about... There's a measure of how long it takes to start a company, to get all the filings, the permits, hire people. It takes six weeks in the US, supposedly it takes 16 months in France. I mean, that's just a problem, right [laughs] ? So I, I think there's a sweet spot.

   25. KSKara Swisher14:26

       Although I, I, I do think in the US there is pushback coming, whether it's, you know, Elon Musk threatening Ro Khanna over normal statements about USAID, to what's, what happened in New York on, on... I mean, there's a real push against a lot of this billionaire power, unfettered capitalism that's coming, I think, hard and fast. And they're starting to win elections, they're starting to have a, have a say. And, you know, you wouldn't normally see a politician like Ro Khanna push back against Elon Musk r- at this point, given, well, he's n- maybe he's not a trillionaire right now. He came down to $996 billion, um, which I feel bad for the guy. Um, but one of the things that I do see coming is a massive amount of payback to these guys. I just see it. I see it everywhere you go. And I think they're not gonna be able to attack Trump in the same way they might like to, but this is gonna be their vehicle of attack, is these guys. As, as... And, and these companies are gonna be in a world of hurt. And you'll see, you're seeing pushback from Disney to the Trump administration. You're seeing pushback from politicians like Ro. You're seeing, you're seeing pushback all over the place by average citizens across. And you're seeing winning by Democratic socialists arou- a- around this billionaire issue, um, that I think is really growing in a way that is significant. And when the Democrats come back, if it's, if they sort of shove the old Democratic establishment to the side, there's, you know, a lot of the Republicans or a lot of the tech people don't think there's gonna be payback, but I do feel like there probably is.

   26. SGScott Galloway15:56

       I, you know, I hope so. I, I think the, I think since the '80s, America has been obsessed with how to create wealth.

   27. KSKara Swisher16:02

       Mm-hmm.

   28. SGScott Galloway16:03

       I think the next 10 years, the dominant conversation is gonna be what do you do with wealth?

   29. KSKara Swisher16:08

       Yeah.

   30. SGScott Galloway16:08

       And what are the expectations of wealth and tax policy? I mean, we talk about rich versus poor. I don't think that's right. I've talked a lot about young versus old, and I'm not sure that's right. I think the conversation is gonna be around entrants versus incumbents. If you already own assets, if you already have a company that's weaponized regulation, if you already own a home, if you already have a college degree, there's been this unhealthy zeitgeist among the incumbents to create scarcity such that-
5. 20:51 – 27:03

   Hollywood’s Blockbuster Year

   1. KSKara Swisher20:51

      uh, we're officially in the summer movie season, and Hollywood is hitting new heights, which is really interesting. Toy Story 5 just opened to $312 million globally. Total domestic box office year is estimated $4.46 billion, the highest since 2019. It's recovered. It is not-

   2. SGScott Galloway21:06

      Huh, and you predicted this.

   3. KSKara Swisher21:07

      Yes, I did. Lots of movies brought in the big bucks, Project Hail Mary, Michael, The Devil Wears Prada, which I am starring in.

   4. SGScott Galloway21:14

      [laughs]

   5. KSKara Swisher21:14

      Plus low-budget horror movies, Backrooms and Obsession, and they're becoming blockbusters, but they're ... It's the first movie since E.T. where the, where the box office has moved up. And I noted my son went to see both these movies, and he's not gone to the movies since I took him to Toy Story 3, I think, at that point. Um, talk about this trend because peop- these theaters, these movie- it's actual mover- movie theater experience. It, it's a range of movies. It's not these, these big, big blockbusters. It's not an Avenger movie. It's, uh, it's, there, though there's one of those coming. It's a lot of, um, I would say, smaller movies in a lot of ways, and they seem to have been really spurring people, not just to go to the movies. And of course, Toy Story 5 is five. It's the fifth one, and it's apparently why I'm not seeing-

   6. SGScott Galloway21:59

      Really? It's the fifth.

   7. KSKara Swisher22:00

      The fifth, yes. Toy Story 5, yes. [laughs]

   8. SGScott Galloway22:03

      [laughs]

   9. KSKara Swisher22:03

      [laughs] Anyway, um, what, what do you, uh, what do you make of this, and how right was I about this situation?

   10. SGScott Galloway22:12

       [laughs]

   11. SPSpeaker22:13

       [laughs]

   12. SGScott Galloway22:13

       Uh, you called this. Uh-

   13. KSKara Swisher22:14

       You went like this. [scoffs] That's ridiculous.

   14. SGScott Galloway22:16

       Well, the question is, is it a, is it a trend or is it a dead cat bounce?

   15. KSKara Swisher22:19

       Okay.

   16. SGScott Galloway22:19

       So, look, the movie industry, to be fair, some of the best performing stocks in media are actually theater stocks. Cinemark and IMAX are up. Theaters at 40 and 45%, respectively, in the last 12 months. The theater business is becoming like airlines. There's Southwest and JetBlue, which is streaming. That's, uh, Netflix serves you content for 30 cents an hour. That's an incredible deal. And then there's Emirates and Qatar Airlines and Singapore. That's IMAX. That's an incredible experience. Uh, the guys in the middle, like AMC or Delta United, are getting crushed. So people are willing to spend 20 or 30 or 40 bucks to go to IMAX or have a really, like, I love iPic, although that just went bankrupt, but they want an experience or they just want 30 cents an hour and reasonably good content. But it, the other, I mean, the other biggest trend culturally right now is IRL. Coming out of COVID-

   17. KSKara Swisher23:13

       Yeah

   18. SGScott Galloway23:13

       ... people probably lost somebody. Uh, people do have disposable income. The economy's been fairly strong, and people wanna get out and touch grass, and, and I think they're just having a, a really healthy gag reflex-

   19. KSKara Swisher23:26

       It does seem-

   20. SGScott Galloway23:26

       ... over isolation.

   21. KSKara Swisher23:27

       Yeah, I do think there's a gag reflex over social media and everything else.

   22. SGScott Galloway23:30

       Yeah.

   23. KSKara Swisher23:30

       All the, it's real- it's interesting. Gary Vaynerchuk here now says analog is in, uh, versus, which I was like, "No shit, Sherlock. It's really in." But the, the, the idea of, of the, the idea that the, this pushing away, I have long thought that social media is gonna decline rather precipitously, especially among young people, and become more of a, you know, 'cause you're starting to see tech companies, like Google just invested in A24, which I thought was in, everyone lost their minds in Hollywood. They thought they were gonna pull their data. I think they're using it to try to figure out how to do better storyboarding, how to use AI, and how to figure out how to change the movie making process, which isn't such a bad idea, the, to use those tools. Although, uh, Hollywood does have a gag reflex to all of these things in favor of these in real life cinema experiences.

   24. SGScott Galloway24:18

       Yeah, I think both can be true because if you look at wh- I, I don't understand. I... People go on Instagram to find out about a yogurt store they'll spend 40 minutes in line for, so that's a combination of the two things. The downside to the IRL trend is the following, and that is... I mean, there's a couple things. You're about to see tables in Mykonos and Ibiza increased 40, 50% in price this summer, 'cause there's about to be 12,000 new millionaires in the Bay Area through Anthropic, SpaceX, and OpenAI. And if you're a 36-year-old who got a CS degree from Carnegie Mellon, quite frankly haven't had... You know, you weren't, didn't have the most social capital in high school, quite frankly. And you wake up, and you've been broke, and you've been paying your student loans, and you wake up after the IPO and you're worth $11 million, you're not going to Disneyland. You're going to Ibiza and you're seeing Black Coffee.

   25. KSKara Swisher25:12

       Mm-hmm.

   26. SGScott Galloway25:12

       The flush of douchebag money about to roll over-

   27. SPSpeaker25:15

       [laughs]

   28. SGScott Galloway25:16

       About to roll over Europe this summer is gonna be just frightening.

   29. SPSpeaker25:20

       [laughs]

   30. SGScott Galloway25:21

       And the, the other thing that's really kind of sad about this is the reason why these concerts and these music festivals can charge two, three, five grand for VIP tickets is because 20- and 30-somethings... When I was 20-something and 30-something, you know what I was doing with all my money? I was saving for a house, and I worry that 20- and 30-somethings have just stopped saving for a house. They've just given up. They're like, "Okay, we are not gonna save 200 grand for a house. Houses are $2 million... Starter homes are $2 million."
6. 27:03 – 34:12

   Instagram TV

   1. KSKara Swisher27:03

      Instagram wants a spot in your streaming lineup. The app is testing horizontal video, long form content-

   2. SGScott Galloway27:08

      Yeah

   3. KSKara Swisher27:09

      ... episodic series, which I think is really interesting. I just met with some Instagram people recently. Is... They're also reaching out to creators, which they were doing in my case, to start making, not micro dramas, but what, what do you, what sub... What is the stuff you wanna make? Short serialized episodes of one to three minutes each, which was a trend many moons ago and didn't really work out. If you recall, a bunch of creators were trying to do that, and obviously Quibi was the other one. I- is this sort of back again? Do you think it'll succeed at this point?

   4. SGScott Galloway27:37

      Well, the clip economy, whatever you wanna call it, a huge trend. I, I don't know about you. I'm absolutely... I hate to admit it. I'm absolutely addicted to Instagram Reels, and it's... I think it's become my primary source of information.

   5. KSKara Swisher27:48

      Me too. Yeah.

   6. SGScott Galloway27:49

      Uh, I think the algorithm is incredible.

   7. KSKara Swisher27:52

      So do you think they can take it to the next step to create mini dramas? Because it didn't work the first several times. This is the third-

   8. SGScott Galloway27:59

      I just don't think you ever... I hate to say that. I just don't think you ever bet against Mark Zuckerberg. I, I'm, I find... I used to think TikTok was gonna disrupt Meta. Now I find myself spending less time on... I don't know about you-

   9. KSKara Swisher28:09

      Me too

   10. SGScott Galloway28:09

       ... this is false marketing, on TikTok and more time on Reels. I think they'd look at it and said... I think Mark says, he looks at something and says, "That's amazing. Steal it. Steal it, and then make it better, and then point our billion and a half person fire hose at it." And-

   11. KSKara Swisher28:24

       So if you're marketers here, where do you start to point stuff at entertainment? It's there, right? It continues to be there. That's gonna be entertainment.

   12. SGScott Galloway28:34

       It's a hard one, because any business dependent upon Alphabet, unless you're the creator, if you try and get in the middle, your margin is their opportunity. 10 years ago, some of the biggest firms here and houses were SEO companies, and then Alphabet said, "The whole point of our technology is we eventually make you obsolete." So I, I'm very reticent. Uh, you know, it, it cr- if you're a creator and you can displace Comcast or ABC or A&E-

   13. KSKara Swisher29:03

       Yeah

   14. SGScott Galloway29:03

       ... with, with one of these platforms, it will give you a greater share of revenue. I think YouTube does that pretty well.

   15. KSKara Swisher29:08

       Yep.

   16. SGScott Galloway29:08

       But any business banking on, um... You're interviewing Meredith, uh, Levin tonight, the CEO of New York Times. Uh, I don't know if you know this host on the board of The New York Times.

   17. KSKara Swisher29:19

       Mm-hmm.

   18. SPSpeaker29:20

       [laughs]

   19. SGScott Galloway29:21

       Um, but we owned something called about.com, and it was worth a billion dollars, and then one night our revenues were down 60% because Google did some Panda thing and basically just crushed our traffic. So a, a decent test anyone should ask themselves is what percentage of our revenue and margin is dependent upon one of these platforms? 'Cause they'll, they'll keep you in business just long enough until you get real margin, and then they'll come for you. So a- a- anyways, I'm, I'm droning on here. I think it's situational, but I think these guys are basically in the business of just finding... Except for the creators, it's, they, they, you know, they do some there, but I wouldn't wanna be in a business focused ever on these platforms.

   20. KSKara Swisher29:59

       On these platforms, but that's exactly where it's going. This is the first time I've thought about creating stuff not... You know, I just did this television show, but now I'm thinking how would I do it not with any of the regular TV entities? Like, what would be the way to make... Say, if we decide to make a Pivot television show, for example, what is a television show going forward? And that's something I'm thinking about a lot.

   21. SGScott Galloway30:20

       Well, it would be on... Yeah, you're right. It would be on YouTube with clips and... But i- if you look at why is podcasting- Drawing so much talent right now and growing so fast

   22. KSKara Swisher30:29

       It's not your looks, but go ahead

   23. SGScott Galloway30:31

       [laughs] When we first started our-

   24. KSKara Swisher30:35

       That was an easy one

   25. SGScott Galloway30:36

       So I'm very- [laughs] That was a layup.

   26. KSKara Swisher30:38

       Yeah.

   27. SGScott Galloway30:38

       So when we, um, started this podcast almost eight, nine years ago, um, and I'm very transparent about economics. I think rich people not talking about their money is nothing but an effort to suppress the middle and the lower class. Rich people talk about their money all the fucking time. Start talking about money. Anyway, um, when I first started on Pivot, I got 15% of the revenue, 'cause the means of production, a company with capital and a studio, I used to go into that lame studio on Broad Street, and they knew how to do podcasts, and it was technology and union people. And, and so the means of production, whether it's MSNBC or CNN or podcasts back then, meant that the talent got 15%. You probably got more, you were the star. But now, talent on podcasts gets 70%, 'cause the means of production just doesn't have the power.

   28. KSKara Swisher31:24

       Yeah.

   29. SGScott Galloway31:25

       That's effectively the arbitrage that's taking place across all media, is the means of production is being arbitraged and getting out of the, getting people out of the middle, such that creators with great content and the end consumer can enjoy. Podcasts are 80% of a television show for 5% of the production cost.

   30. KSKara Swisher31:42

       Yep, absolutely.
7. 34:12 – 35:44

   World Cup Impact

   1. KSKara Swisher34:12

      be a lot of gambling, and un- illegal markets are a worry. But what do you imagine the, the effect of World Cup will be going forward? What do, what is your thoughts on where, where, what, what, what are the takeaways from doing that? Because it really is, I think, the most important, as you said, economic story right now across the globe. Um-

   2. SGScott Galloway34:30

      Yeah, I d- I, I don't have any real insight other than what I said. I think, I think, uh, I think the world and the West needed a reason to like each other again and recognize, uh, that Americans, distinct of our leadership, are an interesting, loving, kind people with really fattening but wonderful food. [laughs] And that Europeans and the, all these nations have incredible cultures, and they bring a little taste of that culture. You're gonna see the prices of teams go up, and even, I go back to the wealth creation of these, these c- companies that just went public. That probably took the price of these companies going up, 'cause sex drives everything. And if you're a 45-year-old who, quite frankly, never got laid in high school, you're trying to figure out a way to become the sexist man in Cleveland, and the way you do that is by buying the Cleveland Browns. And so all of a sudden, there are a ton of people who wanna own sports teams right now that have capital. So you just saw the price of every shitty football, cricket team, whatever, go up 20, 30%. SpaceX up went up 20%. The price of most sports teams globally went up 30 or 40, because you're gonna have midlife crisis money, which is irrational, chasing trophy assets.

   3. KSKara Swisher35:39

      Very excellent. All right, last thing, prediction, and then we'll go questions from the audience.

   4. SGScott Galloway35:42

      The, my prediction's

8. 35:44 – 39:12

   Predictions

   1. SGScott Galloway35:44

      the following. The biggest IPO of this, the biggest tech IPO of this month in terms of first day pop is not SpaceX. It's actually a European tech media company that's pricing next week. Does any... This is a test. Any guesses? Bending Spoons? Bending Spoons. Bending Spoons is essentially the Berkshire Hathaway of beloved but forgotten internet brands. Uh, Evernote, Eventbrite, AOL, um- Vimeo ... Vimeo, WeTransfer-

   2. KSKara Swisher36:15

      Oh, WeTransfer

   3. SGScott Galloway36:15

      ... uh, Meetup, all of these companies that were supposed to be the next Airbnb or-

   4. KSKara Swisher36:20

      They were all the unicorns of the era

   5. SGScott Galloway36:21

      ... all the unicorns, super fat, and then, uh, this company out of Italy comes and buys them, consolidates the back end, which is a polite way of saying cuts costs dramatically, increases their prices. A lot of these companies have very strong margin power and, um, uh, consumer loyalty. Uh, Q1 2025, 200 and, uh, what was it? Um- 270 million, 120 million in losses. This quarter 625 million, 28 million in profits. They're getting a ton of momentum. It's essentially, you know-

   6. KSKara Swisher36:59

      It's orphans brought together in one-

   7. SGScott Galloway37:01

      It's, it's, it's orphaned internet companies with a lot of margin power that have been forgotten, and they're rolling it up. And this is a callback to the most profitable disruptive company that used to own Cannes. This is a callback to WPP that used to buy companies for seven times EBITDA, uh, cut costs on the backend, uh, reduce key man risk, so to speak, and then take it to the public markets at 12 times EBITDA. I think this is an incredible company. It's out of Italy, which is interesting. Really good human capital. And there's about 1,000 of these companies that never quite made it across the goal line, and the most fascinating thing about their numbers is 88% of their revenue is recurring revenue. All of these companies are subscription. So e- basically this is SaaS meets Ber- Berkshire Hathaway. I like the fact that it's out of Italy. I like the fact that it's not AI. Uh, it-

   8. KSKara Swisher37:53

      So it's just a simple cleanup

   9. SGScott Galloway37:55

      ... 2.5 billion, 2.5 billion in revenues. It'll go out at seven to eight times revenues. I think this company will have the largest pop of any internet tech IPO of, of the month. It's pricing next week.

   10. KSKara Swisher38:06

       Classic. It's a classic, is what's happening here.

   11. SGScott Galloway38:09

       Well, it's, it's, it's essentially there's a value in these brands. They still have very loyal audiences.

   12. KSKara Swisher38:15

       Yeah.

   13. SGScott Galloway38:16

       And they were also, they also grew up in a time where capital was cheap, so quite frankly, there's a lot of fat to cut.

   14. KSKara Swisher38:22

       Mm-hmm.

   15. SGScott Galloway38:22

       And these, this, these guys are executing like crazy, and once they have a public stock... Think about how big the list is of companies-

   16. KSKara Swisher38:30

       Yeah

   17. SGScott Galloway38:30

       ... that were once hot, and they're still-

   18. KSKara Swisher38:32

       Yeah

   19. SGScott Galloway38:32

       ... good companies.

   20. KSKara Swisher38:33

       Yeah.

   21. SGScott Galloway38:33

       And they spent billions of dollars of venture capital aggregating audiences.

   22. KSKara Swisher38:36

       Yeah, like Red Envelope, for example.

   23. SGScott Galloway38:38

       [laughs]

   24. SPSpeaker38:39

       [laughs]

   25. KSKara Swisher38:40

       Oh, sorry.

   26. SGScott Galloway38:40

       Why, why are you so hostile today?

   27. KSKara Swisher38:43

       [laughs]

   28. SPSpeaker38:43

       [laughs]

   29. SGScott Galloway38:43

       Jesus Christ.

   30. KSKara Swisher38:44

       No, that was a good company. I sort of got that one.
9. 39:12 – 54:55

   Q&A

   1. SPSpeaker39:12

      Um, so you guys often talk about Polymarket.

   2. KSKara Swisher39:16

      Mm-hmm.

   3. SPSpeaker39:16

      Do you think that it's gonna be used as a legitimate polling data and predictions for the new US election, and should it?

   4. KSKara Swisher39:23

      Legitimate how so? I mean, people are on it, so you can't really-

   5. SPSpeaker39:26

      Yes

   6. KSKara Swisher39:26

      ... stop it. I, I think people pay it... It's one of these things during elections, US people go and stare at them for a minute, and then they go away from them. I think it's being used more as opposed to going to all the... There was a bunch of others that people would go to, all the different polling accumulation sites. I think Scott's been very negative on polling. I think a lot of these prediction markets are easily gamed, and so I worry about their, their, their reality, but they often do reflect sentiment, right? So I think it's just one of those other signals you have to get. But I definitely pay attention to them more than I should, and I know they're gamed in some fashion. I think they're also easily manipulated by a wealthy person, say, named Elon Musk, who has enormous amounts of funds that he's gonna put towards the midterms to create all manner of confusion. And so that's the real danger in it. I'm not sure voters pay attention to it. Like, I just don't. I don't know if voters spend a lot of time. I think a lot of the pundit class certainly does. Scott?

   7. SGScott Galloway40:24

      Uh, I use Kalshi all the time for... And I find, uh, I think polling firms that are non-qualitative are basically out of business. Uh, Kalshi has never gotten an interest rate cut wrong. They have predicted every single Fed action 100%. Um, I totally rely on the prediction markets, specifically Kalshi, for... Because there's something about pundits saying what they think is gonna happen and then looking at where people actually put money. That, if you really wanna know how someone feels, see where they're spending their money.

   8. KSKara Swisher40:54

      Yeah.

   9. SGScott Galloway40:54

      Uh, so I think they're, I think they are in- I'm fascinated by the data. I think they're incredibly accurate and on-

   10. KSKara Swisher41:01

       But they have to self-govern themselves more, 'cause they're, 'cause the government's coming after. You're seeing all these different arrests, and so if they don't self-govern sort of the gaming that goes on, I think it's gonna be a, they're gonna sort of shoot themselves in the foot in that regard.

   11. SGScott Galloway41:15

       Yeah.

   12. KSKara Swisher41:15

       There's case after case of someone doing something funny.

   13. SGScott Galloway41:18

       Yeah, b- I, I, I hope you're right, that's the right thing. The internet is littered with companies that were supposedly gonna be regulated.

   14. KSKara Swisher41:25

       Yeah.

   15. SGScott Galloway41:25

       That were doing [laughs] ... I mean, we'll see. I, I, I hope there's regulation.

   16. KSKara Swisher41:29

       But states tend to wanna go after these companies. You've noticed a lot more action very quickly, as opposed to bigger social media companies right away. Next-

   17. SGScott Galloway41:36

       But the amount of, back, backend, the amount of money, we're gonna find out in two weeks the amount of money being wagered on these markets around the World Cup.

   18. KSKara Swisher41:43

       Yeah, huge.

   19. SGScott Galloway41:43

       Staggering.

   20. KSKara Swisher41:44

       Staggering.

   21. SGScott Galloway41:44

       It's gonna be bigger-

   22. KSKara Swisher41:45

       Billions

   23. SGScott Galloway41:45

       ... it's gonna be bigger than what was ga- what was gamed in Vegas during the same period.

   24. KSKara Swisher41:50

       Yeah, I think more than $5 billion has already been traded on the World Cup outcomes across those two platforms, enormous. Next question, uh, just right here.

   25. SPSpeaker41:59

       Hello.

   26. KSKara Swisher42:00

       Hi.

   27. SPSpeaker42:00

       Mm-hmm.

   28. KSKara Swisher42:01

       Hi.

   29. SPSpeaker42:01

       Great episode. Uh, Ted from the agency, advertising agency, Park & Battery. Quick question. I'd love your unvarnished opinion on this. Do you see a big next act from some of the CEOs that were pushed out? I'm thinking Adam from WeWork, Travis from Uber, and they've gone on to do their own thing, but given all the dynamics and excitement, you know, that we've been seeing and talking about today-

   30. KSKara Swisher42:25

       Yeah

Episode duration: 54:55