← Mixed Signals from Semafor Media
Mixed Signals from Semafor Media
Michael Lynton on the infamous Sony hack and learning from his mistakes
00:42:28
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- [00:01]
Michael Linton
And there was a feeling that you needed to introduce Spider man into the Marvel Universe to get some of that audience back in, and that's really ultimately why the deal was made.
- [00:11]
Ben Smith
Well, Kim Jong Un's gotta stop taking credit for the revival of Spider Man.
- [00:14]
Michael Linton
He probably does.
- [00:22]
Max Tawney
Welcome to another episode of the Mixed Signals podcast from us here at Semaphore Media, where we are talking to the most interesting and important people shaping our new media age. I'm Max Tawney. I'm the media editor here at Semaphore, and with me, as always, is our editor in chief, Ben Smith. Ben, what's the biggest mistake that you've made in your professional life?
- [00:44]
Ben Smith
I had some early, much publicized errors on my blog that I won't get into back in the aughts.
- [00:50]
Max Tawney
Well, people who are interested in those mistakes unfortunately can find them on the Internet. Probably, though a lot of stuff on the Internet disappears. So maybe you won't find some of
- [00:59]
Ben Smith
the really embarrassing stuff somewhat helpfully added this one to my Wikipedia page. So.
- [01:04]
Max Tawney
Yeah. Who edits your Wikipedia page?
- [01:06]
Ben Smith
I mean, you know, my many fans, apparently.
- [01:09]
Max Tawney
Yeah, your many fans, exactly. Well, the reason why we ask is because our guest on the show this week is someone who has thought a lot about their own mistakes, particularly ones that have had enormous ramifications playing out in the public eye. That's Michael Linton. He is the former CEO of Sony Entertainment and is the current chairperson of Snap. That's as in Snapchat and Warner Music. Michael has just co authored a book with Josh Steiner called From Mistakes to Owning your Past so It Doesn't Own youn. And while the name kind of sounds a little self helpy and whatnot, Michael's mistake was actually one that was pretty interesting and that I think many people who listen to the show would be well aware of. And that was his decision to greenlight the movie the interview, which prompted North Korea to hack and release the emails of Sony employees. North Korea decided to take this measure, this extreme measure, because the interview featured a scene in which Seth Rogen and co star James Franco assassinated Kim Jong Un. The North Koreans were not happy about that, threatened Michael, and eventually released these emails. This saga started because of one mistake that Michael said was just from his desire to seem cool in front of very popular celebrities and ended up having these major, major geopolitical conflicts and changed his life and the trajectory of Hollywood forever. Ben. It was a remarkable saga that Michael actually hasn't talked a lot about before releasing this book.
- [02:47]
Ben Smith
Yeah, he led through it with this incredible Kind of like optimism. And it's really interesting to sort of now see really how dark it was from the inside.
- [02:56]
Max Tawney
Yeah. And this hack and the release of the emails raised a lot of questions, which have actually been subsequently explored afterwards in other high profile hacks, about the nature of hacked materials, how news and media organizations should handle them, whether it even really matters anymore, given that everyone is their own personal media brand and private sleuth. So we wanted to ask him about that, and we of course, wanted to ask him about the state of Hollywood today. We wanted to ask him about Snap, the company of which he's a chairperson, and the future of music in a world where AI replication has gotten so good. Ben, did I miss anything? Anything else we want to talk to Michael about before he hops on with us?
- [03:34]
Ben Smith
I mean, that's a lot. Might be a mistake to ask him all those things.
- [03:38]
Max Tawney
That's true. We'll try to make as few mistakes as possible in this interview, but we have to take a short break and we'll be back with more from Michael right after this.
- [03:53]
Ben Smith
Our friend Josh Spanier, Google's VP of marketing, has a new podcast out called Frontier cmo. It's from Think with Google, and it gets into all the ways marketing is shifting, especially in the AI era, where the old marketing playbooks have become obsolete and the whole role of the CMO is being redefined in real time. Josh talks to the people who are actually figuring it out, top CMOs, industry leaders, and creators, and gets into the real world challenges and specific strategies they're using to navigate this new era. These are notes from the marketing frontier. You can find Frontier CMO on any podcast platform or watch it on YouTube. Michael, thank you so much for joining us and congratulations on the book.
- [04:35]
Michael Linton
Thank you for having me.
- [04:37]
Ben Smith
I wonder if we could just start with what in your chapter of this book, in some sense is the original sin, which is a table read in 2013 with Seth Rogen. Can you just tell us that story?
- [04:48]
Michael Linton
Yeah, of course. We were presented with a. The script of a movie called the Interview, which is.
- [04:54]
Ben Smith
You were then running Sony.
- [04:55]
Michael Linton
I was then running Sony Entertainment. Amy Pascal was running the movie studio side of things. So entertainment comprised movie, television, and music. And at the time, we had a very strict process in place to greenlight movies, which is pretty accepted in the industry. You know, at a certain point, you get all the relevant, important functions around a table, finance, marketing, blah, creative, and you come to a collective point of view about whether or not you want to go forward with this in this Particular moment, we had made a bunch of R rated comedies with Seth Rogen, all of which had been successful. Universal also had made a bunch of R rated comedies. And so he had two homes, two places to go. Every script, therefore, was at some point competitive. We were presented with this movie, the Interview, which is about two sort of hapless journalists, Seth Rogen and James Franco, who under the direction of the CIA, go off to North Korea, ostensibly to do something, but really to assassinate Kim Jong Un. And everybody on the creative side of our business in the studio wanted to make the movie. And we were under time pressure to do so because if we weren't going to say yes, Universal would probably say yes. So we decided to have this table read and to set the scene, it was in a big room. You have all the cast around a table, you have all the creative staff who's there as well, from the studio, Amy's there, everybody's dressed very casually. And I walk in and I am not only in a suit, I am the suit. I am the last person remaining who is sort of skeptical about whether we should make this or not. That's the reason why we're having the read through. And under normal circumstances, at the end of a read through, we would have said, okay, fine, that was great. If it was a successful read through, let's go back and we'll come back to you in a day or two and tell you whether we're doing this. In this case, I got caught up in the moment at the end when everybody was saying and high fiving each other like that was really funny. And, you know, let's go do this. I, for the first time in a decade, I'd been in the job for about 10 years, said, yeah, let's go do this, let's make this. And that was proved to be a gigantic mistake because what ensued was, you know, the North Korean government wound up hacking our entire system. There was the biggest cyber attack on a corporate, I think, ever at that point, certainly by a foreign power. And it brought us to our knees and destroyed many people's careers and ruined a lot of things.
- [07:24]
Max Tawney
I'm surprised to hear that, you know, that you thought that Universal was interested in making this as well. Given the risks of this kind of
- [07:30]
Michael Linton
assassination scene, I don't know how Universal would have responded. And I don't know whether we were being agented at the time or whether they were genuinely interested. I think from our vantage point, we probably would have flagged it in a meeting such as the one I described earlier, because the public policy people would have been there, and our general counsel would have been there. And as a Japanese company, we had a specific relationship with North Korea at the time. Actually, Prime Minister Abe was negotiating with the North Korean government to try and retrieve the bodies of these hundred hostages, these children who had been abducted from the streets of Japan back in the 70s. I had no knowledge of this, but, you know, it was a very tense moment between the Japanese and the North Koreans in a relationship that traditionally is
- [08:17]
Max Tawney
tense afterwards, you know, presumably you. You have to go and, you know, tell people that you decided to. To green light this. And you do talk about having some doubts, and there was some debate after you greenlit it. Why do you feel like you stuck with it even though you made that mistake in the moment?
- [08:33]
Michael Linton
Yeah, so it definitely sort of gnawed at me a little bit when you say we had to tell people. I didn't. We didn't regularly communicate back to Tokyo with a movie that was of this size. I think it was a 30 or 40 million dollars movie. It didn't require any approvals or anything out of Tokyo. And in truth, the only. It first became a real problem only after we had finished the movie and we. We put out the first trailer. And that was the moment where we started getting threatening notices from the North Koreans or people who said they were the North Koreans, because we didn't have an official channel of communication. And at that point, I really felt strongly that you needed to put the movie out. You know, it. It. I. I'd had some experience with something vaguely similar because I had come into Penguin a few years after they'd published this, the Satanic Verses. And in that case, you know, if you'll remember, everybody had the fatwa put on their head. And in fact, three people died. The difference was that the publishing industry was incredibly supportive of Penguin, who was the publisher at the time. And I. I just felt very strongly that you don't get to pick your battles over censorship. You. Once you decide you're going to do something, you're under an obligation to do it. Especially, actually if somebody like the North Koreans are telling you, you can't put this out.
- [09:56]
Ben Smith
You know, honestly, reading this chapter, I left thinking, was this really a mistake? Like, I kind of want my studio head to occasionally say, damn the torpedoes, and sure, there's some tail risk, everything, but this was a pretty. This wasn't exactly a foreseeable risk. And I don't know, I almost. I. I left thinking, like, are you sure this was a mistake? Just because there are bad consequences doesn't always mean it was a mistake. I think.
- [10:17]
Michael Linton
Yeah, I would still view it as a mistake a little bit for the reasons that I was describing a moment ago, which is if you looked at the risks, whenever you look at something, a project like this, it's not just the financial risks, it's also the big. The other risks that can come to it. I think it would have become pretty evident pretty quickly. And that to kill in a movie, the hostile leader of a hostile nation, which I'm not sure other actually has ever been done before since, was a clever idea and was, I think, almost certainly a mistake. In fact, when President Obama called me, this is also in the chapter to apologize for something. He was the first one to bring my attention to the fact that he viewed this as probably a mistake. And I had to agree with him.
- [11:04]
Ben Smith
I sort of hadn't thought of this, but there is a tacit sort of foreign policy veto across Hollywood in a way. Right. Like, people are very careful with the Chinese. They're careful with the Russians in this situation. Made it visible a bit. But do you think that in a way what we're seeing in the movies is a bit shaped by the studio's fear of being hacked?
- [11:23]
Michael Linton
No, I think that's a different question. I think that hacking is one thing, and that's in the extreme. I think what mo most studios look at is where they can distribute the movie. And Russia at one time no longer was a very good market for the studios. China still remains a good market. And I think they are careful about what they put in their movies to make sure they still have access to those markets.
- [11:48]
Ben Smith
Right.
- [11:48]
Max Tawney
There is no North Korean market, so you weren't necessarily concerned about that. But of course, Kim Jong Un was still the leader of different.
- [11:55]
Michael Linton
Different countries.
- [11:56]
Max Tawney
Yes.
- [11:57]
Michael Linton
But, you know, I remember the very first Spider man going all the way back to the Sam Raimi version. You probably don't remember this. I wouldn't either. Had Spider man sort of lifting up an American flag. We never did that post that moment because that was not well received outside the United States in that moment. And so the whole question, and it's a separate conversation than the one we're having about the book is about how is soft power now showing itself in American movies when you can't basically beat your chest with patriotism at the moment and have access to international markets the way you once could.
- [12:37]
Ben Smith
There's something you said after the hack that. That really stuck with me about how when you were kind of like leading through this crisis that your formula for survival was to be ridiculously optimistic and that you just sort of every day told people like, this is going to wind up being the best thing that ever happened to us. Like, and I remember people telling me about that and how effective you were in that moment. Does that mean it took you a while to realize it was a mistake because you sort of had to force to believe in it, or was it immediately obvious to you?
- [13:03]
Michael Linton
Well, it was certainly immediately obvious after I had that phone call with President Obama, but it was obvious to me prior to that. I think my attitude about optimism was, you know, a movie studio is very much like a small college campus. There's the Sony lot was about 40 acres. You have about 7,000 people there. And everybody's very visible to everybody else. Certainly the person running the place is. And in those moments when everybody is sort of confused and down, the folks in authority need to be present and upbeat. And sometimes that optimism can be a little false, meaning you're sort of generating it, you're faking it for the moment. But no, I had a pretty clear understanding that I had made a big mistake by allowing this thing to go forward.
- [13:49]
Max Tawney
So, Michael, you have a family full of journalists, but I'm curious, how do you think that the journalists handled the hack? There was obviously a lot of bloggers and people at the time who were going through pretty damaging and personal stuff. I think Gawker was doing like a, you know, daily updates from this thing. I, I remember that quite well. I'm curious what, what you thought about how the media handled the hack.
- [14:15]
Michael Linton
Poorly, in my view, I think. And Ben, I can't remember where you were at the moment. Were you at the Times at that, at that moment?
- [14:23]
Ben Smith
I was, I was at. I was at Buzzfeed.
- [14:25]
Max Tawney
Did you guys write about this? Ben?
- [14:26]
Ben Smith
I'm sure we did. I'm sure there's stuff I'm, I'm sort of. I feel bad about, but I should have gone back and looked. We were not as. We were not as aggressive as Gawker, for sure.
- [14:35]
Michael Linton
In general, when it comes to the media and this stuff, these emails were private emails that were disclosed illegally. And to set the scene with what. What the North Koreans were doing at the time was they would bring together a cache of emails. You as a journalist would have to type in Die Sony. When you type that in, the emails would be released to you, and then you could go through them, sort of do a dumpster dive on them, and you would come out with salacious material because there was a lot of emails from movie stars and other folks. And to me, that was just the lowest form of journalism. And it was sort of a funny thing because I would talk to a variety of different journalists, both at more established places like the Wall Street Journal and less established places like the sites you're referring to, and they didn't feel good about it, but they kept saying, well, our competitors are doing it, so we have to do it. Or they would say, well, it's already been published on Gawker, so we're just reprinting something that Gawker has already published. So. And every time you would say to them, come on guys, you know, you signed up for a higher calling than this, they would sort of shrug and they'd say, yeah, but this is what our editors want and this is how we can get people to read, you know, read our pieces. So in general, I thought they behaved poorly in the whole thing.
- [15:57]
Ben Smith
I remember the moment thinking, what do we do with this? I think in the end we were pretty squeamish at buzzfeed, which I think I've not always been in that position, but I think I feel good about,
- [16:05]
Michael Linton
in retrospect, my recollection that that was the case.
- [16:08]
Ben Smith
Yeah, this kind of hack has, since then, obviously the DNC emails, the Epstein files, like, has become kind of a routine part of journalism. And it does give often intelligence services a way to kind of set the agenda, decide what the story is going to be. Epstein is the thing of the moment. How should people like us be thinking about these huge disclosures of emails that are mostly just thousands of people's private emails? How should we think about them?
- [16:38]
Michael Linton
You know, I haven't been a student of what actually has been presented. I would say a couple of things. First of all, these are emails that are my understanding of it being officially provided by the Justice Department for the public to look at. That's a very different thing.
- [16:53]
Ben Smith
Well, I don't know the government releasing them for political reasons of its own. It's not that different.
- [16:57]
Michael Linton
But there you have it. And I was about to say, and you, and you also have a government, I would say that didn't really redact them very well. So I think some people who got caught up in it, particularly people who at the time were underage, who never should have been caught up in it, whether it be their likeness or. And to some respect, I think that the journalists have not been behaving great with that they should self redact on those type of things, particularly when people are under age.
- [17:23]
Max Tawney
I actually think that one of the interesting consequences here, because the Sony hack happened right before the DNC hack and the release of those emails as well, and those two events happening in kind of quick succession, I think the other consequence has just been that fewer important people put things in email. I think that we've, we've seen it over and over. Do you think that that's the case? Do you think that other people have learned from your mistake in that way, Michael?
- [17:47]
Michael Linton
I would say yes and no, which is a very unsatisfying answer. So the number of people I know now, and you probably have the same who will say meet me on signal is a lot.
- [17:58]
Max Tawney
Yeah.
- [17:58]
Michael Linton
But it sometimes feels the equivalent of somebody's, you know, who's ordering an enormous meal and then a Diet Coke. Because by the same token, I know those same individuals are writing emails which they've told me they regret writing, and they're writing them as, you know, as of a month ago. So I think both things are true at the moment.
- [18:20]
Ben Smith
Yeah, I'm still on some crazy email chains.
- [18:23]
Michael Linton
There you are.
- [18:24]
Ben Smith
In terms of the. Please forward me more if you got them. In terms of consequences of the hack. I mean, I think these things are often unpredictable, basically. And it had kind of consequences. On the creative side, it sounds like Spider man basically got revived in part because of fan pressure that came out of the hack. But then, if I have that right, and then I just saw the writer of the film Sinister Six, which was never made, complain. He also just made Project Hail Mary. He was complaining in some interviews that the hack had killed his film at Sony. How did that play out? Because it sounds like you had to make a bunch of green light decisions based on things that came out of the hack.
- [19:02]
Michael Linton
No, I don't think that's right. I think the world of Drew Goddard and, and he was very involved with the studio at the time and obviously he's had an enormous success with Project Hail Mary. No, I think those projects were evaluated on their own and they were found not to be good enough to make. I don't think that the, that the hack had anything to do with it,
- [19:25]
Ben Smith
quite candidly, but there was a sense there. It was, at least it was written at the time that, that you cut a deal with Universal over reviving Spider man in part because of fan pressure out of the hack.
- [19:33]
Michael Linton
No, that's not accurate. So what my recollection, it wasn't with Universal, was with Disney, which owned Marvel.
- [19:39]
Ben Smith
Sorry, with Disney, Yeah.
- [19:41]
Michael Linton
And what happened over the course of the sort of years between the previous Spider man and the one we were trying to make was that the, the importance of the Marvel universe had grown. You had these huge Marvel movies that were showing up, Avengers and others. And we thought that. And we had to keep retelling, you know, the origin story of Spider man every three episodes. And it was getting a little. It was complicated how to make that fresh. And there was a feeling that you needed to introduce Spider man into the Marvel universe to get some of that audience back in. And that's really ultimately why the deal was made for them to co produce it. And that's why Tony Stark showed up in the next Spider man was because of that deal.
- [20:27]
Ben Smith
Well, Kim Jong Un's got to stop taking credit for the revival of Spider Man.
- [20:30]
Michael Linton
He probably does.
- [20:34]
Max Tawney
Well, we have to take a short break, but we'll be back with more from Michael right after this.
- [20:47]
Ben Smith
In this week's branded segment from Think with Google, I Talked to Google's VP of marketing, Josh Spanier, about YouTube's huge place in the media ecosystem. So, Josh, we are just coming out of awards season in Hollywood, but awards season is really changing. And starting in 2029, the Oscars are going to stream on YouTube, ending a 70 year broadcast run. What does this say about YouTube and the changing shape of media more broadly?
- [21:11]
Josh Spanier
I love movies, Ben. I personally haven't loved the Oscars for a while, and I'm not the only one. It's had declining telecast ratings for a decade and more. So I'm actually really excited for YouTube to help reinvent the Oscars telecast. The irony of all this is the actual conversation about Hollywood, the conversation about the makeup, the dresses, the glamour, the glitz, the watches, all aspects of Hollywood has actually only increased. It's just moved online and moved to YouTube. You just have to look at the buzz surrounding the new Dune 3 trailer to see how this is all happening online. So sync creators unleashed on the Oscars is actually going to be really, really exciting at a larger view. I also think it's reflective of the fact that these conversations are happening every day of the year at a scale which is simply gargantuan. There is a Hollywood conversation happening on YouTube, larger than the Oscars, larger than the Grammys, larger than the super bowl, every day of the year. And it's a great opportunity for brands to participate, lean in, and just be part of all that. Oh, one other thing which I think is kind of fun. Google's arts and culture team, who have digitized over 2000 museums and galleries around the world using high resolution imaging over the last couple of years are also going to be working with the academy to digitize a huge proportion of their own catalog of movie props, movie scripts, and classic memorabilia from the movie business. That's going to be really fun for everyone as well.
- [22:34]
Ben Smith
And where can people go? To find out more about this, head
- [22:37]
Josh Spanier
on over to thinkwithgoogle.com we just published a really interesting article Looking back at three years of streaming success and leadership on YouTube and how you as a brand can participate and learn from it.
- [22:54]
Ben Smith
One final question on the sort of thesis of the book. It's like a book by and for people who believe in therapy. I was just thinking about the sort of Converse case, which in some sense is the Donald Trump case. I remember there's this great line in Confidence man, the Maggie Haberman book, where somebody says to him, you're a very shallow person. And he says, of course, that's one of my strengths. Part of me read the book and thought, you know, I don't know how much you're getting out of all this reflection. I think a lot of CEOs will read this and be like, yeah, I don't spend a lot of time reflecting on my mistakes.
- [23:23]
Michael Linton
That may be the case. You know, I know a few of them. And I would say, for the most part, look, when what Josh came to me with, when we started this whole project with a walk on the beach. We had known each other and were close friends for a long time, and the hack had happened sort of five years previously. And he said to me, michael, every time I raise this subject with you, you avoid talking about it. And I have my own mistake I made that I don't feel comfortable talking about. And I know that that's not healthy. And I know that when I walk around, I think everybody's looking at me, thinking about the mistake I made, despite the fact that it was many, many years ago. And you probably feel the same way. We gotta get out from underneath that. And so the process of going through this with him, you know, and we brought on a terrific woman out of Johns Hopkins, Allison Papadakis, who's a professor of psychology there. And we started interviewing people about their mistakes. Some of them well known, not so well known. But the process of unpacking these mistakes and trying to understand what was the emotional origin of. Of what got you to this place, I found incredibly therapeutic. And it's true, it was a big burden on me. And it was a welcome respite to get it off my chest a little bit more than a little bit. It takes some Courage. It certainly is very helpful to have a process and a partner to do it with. And, you know, I don't know, despite you could be the CEO of a big company, you could be, you know, not the CEO of a big company. And I think the process of looking at your mistakes and trying to understand why you made them, and equally, if not more importantly, how to deal with the shame and the regret that you sort of carry around with you after the mistake is a very healthy and good idea. It was certainly very helpful to me for.
- [25:13]
Max Tawney
For people in leadership positions, or maybe just people in general. Where's the line between, you know, acknowledging and confronting your mistakes and trying to learn from them and wallowing in them? Right. And over learning the mistakes so that maybe you don't take a risk in the future for fear of repeating that same mistake.
- [25:33]
Michael Linton
And that's, you know, the not doing something because you fear the consequences of it. That's always. That in and of itself is a mistake. You know, it's like the librarian who wants to keep every book on the shelf for fear that if you lend a book, you'll never get it back. Well, that sort of defeats the purpose to a library you got. If you're a librarian, you probably should take that risk. I think if you have somebody at the top of an organization who's willing to admit to a mistake and say, I've made a mistake, here's what it is. It does a couple of things. First of all, it's helpful to them along the lines I've just described, but it's also a message to the organization that it's okay to admit that you've made a mistake and to bring your colleagues in on that. And it's probably a helpful way to avoid making more mistakes in the future. To your point about wallowing, I'm not suggesting for a minute, despite the reference to psychoanalysis and all the rest, which there is a component of that, I suppose, opposed to the book. But I'm not advocating wallowing it. There's no reason that you have to go on and on and on about it to an organization. It's simply acknowledging that you made the mistake, explaining how you're going to deal with the mistake and moving on to
- [26:45]
Ben Smith
move back to the media business, because this is a media show. You chair the boards of Snap and of Warner Music. What are the mistakes that, you know, that the chairman of a board makes, particularly in the media business right now?
- [26:59]
Michael Linton
I mean, I think a board chair is designed to do just that, is to chair the board not run the company, not give instructions to management, nothing like that. So the mistakes would be around how the board itself behaves. I think part of the mistakes can just be down to issues of governance, meaning are you actually asking the right questions in the right moment of your management? And that oftentimes doesn't happen, particularly if you have a board who is not that familiar with the media business and doesn't know what questions should be asked. I would say the other side of it, I would say is the board is chair, is there to keep control of the board and make sure that they don't get themselves too involved with the business. And I've seen that happen too on occasion, where you get a random board member who suddenly decides they want to become very involved with the business and the board chair should be holding them back and saying, that's not the role of the board.
- [27:57]
Ben Smith
Here you've been in that role at Snap through its ipo, up, you know, way up and way back down the stocks at like four or five bucks. Now was there, did that company, did Evan make a mistake or was this just, you know, a tough environment?
- [28:10]
Michael Linton
I think it was more that it was a tough environment. I think when you look at what happened with our competitors, Meta, specifically in Google, they just became that much bigger and you sort of see what's happening in the advertising landscape, a version of what's happening more generally in tech is that the big just gets even bigger. And if you look at other companies that are like size to Snap, whether it be, you know, printers and others, it's just that the pie was, was, was smaller. So I don't think there was any specific mistake there. No.
- [28:43]
Max Tawney
Yeah. Though it is. At the same time that TikTok entered into the US market, was there something that you think was that they did, right, maybe that Snap missed?
- [28:51]
Michael Linton
No. Well, I mean they, they definitely had a specific format which both Snap and Meta have a version of. They had this very powerful algorithm which took a long time for people to understand how it works and to do it to a degree replicate it. So those two things, that one was a very technical thing that they'd figured out that others hadn't. You know, and you have to remember, if we hadn't, if we didn't have the current administration in place, we wouldn't have tick tock. I mean, we were sort of thinking to ourselves, you know, Congress passed a law, the President ratified it, the Supreme Court by a vote for six to three came out and said this is okay. The NSA said it's important to happen. And then for some reason we still have TikTok hanging around. So that, that, that is a, that to me is the bigger question. Why is that? Why is that the case?
- [29:42]
Ben Smith
It's unusual times. You also chairman of the Warner Music Board, and, and you've been broadly right in the middle of the digital transition around music for almost your whole career. And the music industry has often been the canary in the coal mine of new digital business models. Again, really? Since, since the beginning?
- [29:59]
Michael Linton
Almost always. Yeah.
- [30:01]
Ben Smith
Yeah. And I guess in particular is, do you think that what Warner has sought to do to ensure that artists are compensated for AI uses of their work, is that a template for film, TV news? Are there things you've learned there that are more broadly applicable?
- [30:15]
Michael Linton
Yes and no. So sorry to keep answering. Yes.
- [30:18]
Ben Smith
Wow, that's your favorite answer. Yeah, well, it's a very measured, careful. No mistakes.
- [30:22]
Michael Linton
Yeah, yeah, there's definitely things to learn. Let's just put it that way. Music is typically first when it comes to technology stuff because the, the files are smaller and therefore, you know, it, it happens earlier in the life cycle of a technology. I think the idea that the models can train on material that is licensed, subject to the artist approval, is an appropriate model. And that's the, that's the model that Warner is pursuing. And that artists should be compensated to the degree to which that licensed material trains the model and is then making use of their material. For sure. I, I do think, though, that there is a greater experience or habit of consumers manipulating music going right back to, you know, forming early playlists than is the case in the movie or television business. So I think the audience is by definition more inclined to want to have another version of a song than would be the case of another version of a television episode. It's just, it's, it's. We all know that to be true, but the underlying model, this notion that the, that the large language models, or any model for that matter, requires a license to train off of a piece of IP and that whoever created that IP should then be compensated for that? That, I think is the. As an appropriate model, yes.
- [31:51]
Max Tawney
You know, one of the biggest stories of the year has been, you know, this ongoing saga with Warner Brothers, Discovery, Paramount, Netflix. A lot of attention has been paid to the param outside. But I'm really curious what Netflix does after this. What do you, what do you think that they're going to do now that, you know, the Warner Brothers deal is, has fallen through for them?
- [32:09]
Michael Linton
I mean, I, I have no idea. I think they have a Very winning model. Obviously. I think their technology is probably better than anybody else's, which has helped them enormously over time. And they have this global footprint with a lot of local content. The thing that they were missing, I suppose, was more volume because, you know, the capacity to consume on the. On the platform is endless. And they needed more tent poles, you know, big franchises. So my suspicion is they will try and either buy more or get more in the marketplace somehow. But it, as they said, it's a nice to have, not a need to have. I don't. I think this was, judging from a distance, because I'm not involved. This was much more important for Paramount to have and not be stuck in a middle position than it is for Netflix to have. Who is in a leading position in
- [33:01]
Ben Smith
that moment when, when everyone was racing to build a streaming app, Sony was really the exception. Your old. Your old shop. I don't remember how your. Whether that's. These conversations were in the air when you were there, but I'm curious how that decision looks now that, you know, Paramount builds an app, Sony doesn't, and just focuses on making movies and selling them.
- [33:19]
Michael Linton
You know, again, I've been away for the company for a decade. What I can tell you at the time was, yes, there was a lot of conversations around turning particularly the PlayStation Network into a form of streaming. And the thing that not many people know is that a third of all the Netflix subscribers for a long period came off of that PlayStation Network. They paid us for almost a decade, a significant bounty to bring people over to Netflix. We definitely knew that the audience playing games on PlayStation Network were movie and television watchers.
- [33:53]
Max Tawney
Michael, sorry to interrupt. Was that just because people were using their PlayStations like they use Roku, where it was like, this is a thing that I can get the Netflix app on here and it's going on to my tv. Is that why?
- [34:03]
Michael Linton
Okay, so there was a lot of conversation about shouldn't we be in this business? And shouldn't. And by the way, there's also a history with Sony, if you think about it going back to the music side of things, where given the size of the music company that Sony has, we should never have allowed Spotify into the business. Right. We should have had our own platform there, too, or each of the music companies should have. But I think what happened at the time was Sony was not as in. As strong a position as it is today and financially, and it wasn't devoted to media the way it is today because it was still very much a consumer electronics company in addition to being media company and they were not understandably willing to devote the billions of dollars that would be required to start one of these things up between the financial component and the, and the focus of the company. This is just not something that they wanted to pursue. I talked, we, we modeled it. We did that extensively. Zach Van Amber and Jamie Ehrlich, who are now at, at Apple, they were very engaged with doing this before they left for Apple. It was the decision of the company whether that was the right or the wrong decision. I can't, I don't know enough to know. I know that in the current position of brokering they're in a good, you know, that's worked out well for them financially. Whether in the long term that's viable, I can't speak to looks as though they're the. They're one of very small number who don't have a streaming platform and that may be a disadvantage over the long term.
- [35:38]
Ben Smith
One last question, Michael. Do you ever wake up and wish you were running a movie studio again?
- [35:42]
Max Tawney
No.
- [35:43]
Michael Linton
No, I really, I did it. I was there for about 15 years. I had a great time. I worked really closely with Amy Pascal and others. No is the short answer. It does. First of all, it doesn't feel as much fun as it did at the time. At the time it was a lot of fun. And secondly, I did my time and now I'm enjoying myself doing other things.
- [36:05]
Max Tawney
All right, Michael, well, we really appreciate you taking the time today.
- [36:08]
Michael Linton
Thank you.
- [36:08]
Ben Smith
Thank you, Michael.
- [36:09]
Michael Linton
Thanks for having me.
- [36:19]
Ben Smith
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- [36:55]
Max Tawney
So Ben, we were just talking during the break about how you kind of disagree with some of what Michael said around his theories about mistakes and what one should take away from them. And why do you disagree?
- [37:07]
Ben Smith
Oh, I guess, you know, I mean, this is probably just a mark of poor character, but I guess I feel like in my own career I have benefited from not reflecting too much from. And particularly in journalism, I think often there is a kind of you can overthink the consequences like the job is to publish things that you know and you can get really tangled up if you start to wonder whether people ought to really know this thing or not.
- [37:32]
Max Tawney
That's really interesting. I think that that's probably, that's probably true. And I think as you get deeper into a subject too, it becomes more true because you get to know people more and you get more obsessed with that question. Whereas when you're just starting out and you've got a scoop, you're like, who cares? This is great. Let's get this information out there.
- [37:48]
Ben Smith
I don't want to go too far in this because as I said, I'm like, yikes. I'm like an ex. I'm really an executive now and I should go reread Michael's book and reflect on what in my childhood is going to lead me to make my next mistake. So I'll go off and do that after this.
- [38:00]
Max Tawney
Let's focus on the actual substance here and the interesting media question at play. Michael was very, very frustrated with the way that the news media handled the Sony hack. And you know, this is not a question that is dead. This is a internal debate that's happening all the time. Ben, during the interview you mentioned the Epstein files right after the Sony hack. Of course there was the Democratic National Committee email hack and release where a lot of these same questions about what should be public and what shouldn't were out there and debated again. Meanwhile, the general public and the Internet has no such qualms about how think about this stuff. Plenty of independent creators and people in the fragmented media ecosystem are running wild with all sorts of this types of information. It seems like the only people who still care about gatekeeping any of this is those of us who are left in the legacy media or legacy media adjacent media companies. What do you think about Michael's prescriptions? And where do you kind of fall, you know, providing the information that's real and that's out there and that's available versus why should we be talking about this and focusing on this?
- [39:04]
Ben Smith
Yeah, I mean, it's funny because as you say, it's just a much less consequential question. Now who cares if whether or not journalists go rooting around these files and finding embarrassing stuff, you know, random people on Twitter will. And I think everybody just needs to develop antibodies to, okay, this is a ugly private thought that someone expressed to one friend and probably shouldn't be interpreted like a public statement. And I think that's a hard thing for people to get their heads around. But, but it's sort of a human reality as a, you know, as a journalistic matter. I've just sort of refreshed my memory. Like, BuzzFeed was pretty. We were, we didn't. I couldn't kind of go rooting around people's personal lives in the Sony hack when I was there. And I remember we spent a lot more time. Catherine Miller, who's now at the Times, and I spent a lot of time thinking about how to cover the DNC hack. And I remember, you know, the thing that we kind of wound up with was look like the fact of the hack and the motives of the hackers are actually a much bigger story than anything in the hack. That's true. The Sony hack too. Nobody, I mean, the details are all inconsequential. The fact that North Korea waged cyber war on a big Japanese company, that was the big story. Similarly, nobody remembers anything that was in the DNC leaks. The hack itself was more important. Of course. How do you then deal with that? Like, we dealt with it by trying to say that in the second or third paragraph of the stories we did and trying to be fairly restrained about stories. But when there is revelatory stuff in these things, like here's the secret speech that Hillary Clinton gave to Goldman Sachs and has been trying to keep from everyone, and here it is. I mean, that is still news, right?
- [40:30]
Max Tawney
It's interesting.
- [40:31]
Ben Smith
And so I think you've seen the. Some outlets, the Times, I'd say, in particular, you step back and do these big conceptual stories and try to use the emails not as a little gotcha here and there, but as a real. Is something more satisfyingly revelatory about how the world works. And I guess I do think that in an environment where, whether you like it or not, these things are public and people on social media are all over them, that is a real function for the professional media.
- [40:57]
Max Tawney
I think ultimately the lesson, and we talked about this during the interview a little bit with Michael. I think the lesson that many of us have learned from all of these series of hacks and releases, and you've been a part of some of them, my emails as a youngish reporter in my early 20s, were a part of the DNC hack and I think really shaped the way that I think about this, which is that all electronic communication, everything that we put out there has a. Has a risk, has a serious risk of, you know, being released into the world. And I actually do think that a lot of people in major professional environments have internalized that, particularly ones that have been adjacent to these big moments. I think that people really, really did lear from what ended up being a mistake that Michael made to seem cool.
- [41:42]
Ben Smith
And so anyway, yes, yes, kids, set your slack retention times to two weeks if you take nothing else from this episode.
- [41:51]
Max Tawney
Well, that is it for us this week. Thank you so much for listening to another episode of Mixed Signals from us here at Semaphore Media. Our show is produced by Manny Fadal with special thanks to Josh Billidson, Rachel Oppenheim, Anna Pizzino, Daniel Haft, Garrett Wiley, Jules Zern and Tori Koor. Our engineer is Rick Kwan and our theme music is by Steve Bone. Our public editor is Kim Joo Ae, I think the eventual Supreme Leader who hopefully will not hack us for even talking about this episode.
- [42:20]
Michael Linton
Again.
- [42:21]
Ben Smith
If you're listening from North Korea or anywhere else, please follow us where you get your podcasts and subscribe on YouTube.
- [42:27]
Max Tawney
And if you're if you're in Pyongyang or elsewhere, you can always sign up for Semaphore's Media newsletter, which is out every Sunday night.
- [42:34]
Ben Smith
Sam.