
A labor dispute from ‘Love is Blind’ & BuzzFeed sells its most popular show
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Neal Freyman
Good Morning Brew Daily Show. I'm Neal Freyman.
Toby Howell
And I'm Toby Howell.
Neal Freyman
Today, mysterious drones are flying over New Jersey and nobody has any idea what's going on.
Toby Howell
Then 10 wings doused in hot sauce may have just saved Buzzfeed. It's Friday, December 13th. Let's ride.
Neal Freyman
Toby, welcome back. Hope you're feeling better.
Toby Howell
Neal, thanks for holding down the fort. You are a one man band, a solo act. Incredible performance yesterday.
Neal Freyman
Thank you. It's also Friday the 13th today, which is one of the spookiest days on the calendar. But not everyone is proceeding with caution. For some people, the number 13 is actually lucky. One person I'm thinking of is obviously Taylor Swift. Her birthday is today. She considers 13 to be her lucky number. And then some cultures, including ancient Egypt, also believed the number 13 was lucky. And then for Colgate University, the number 13 is just venerated. The New York school was founded by 13 men with $13, 13 prayers and 13 articles. They have a whole website dedicated to the number 13, so they love 13. Are you, are you a person who thinks 13 is lucky or unlucky?
Toby Howell
I mean, I was going through it because I was wondering if I have any superstitions. And I have routines. Like I set my alarms at the same time every morning. I always lay my clothes out the night before. But I think I'm realizing that it only moves from routine to superstition if something bad happens following a departure from that routine. And so far, so good. I haven't had anything bad befall me if I do set my alarm at, you know, 408 instead of 409. So I don't think I have superstitions. Were you a superstitious guy?
Neal Freyman
I am, but I think it permeates my life so much that I can't identify just one. But I will think over. I'll think of them over the course of the show and let you know if any pop up.
Toby Howell
So you're not superstitious, you're just a little stitches. Now let's hear a word from our sponsor, Sage Neal, Two words I want to talk about today. Visibility and speed.
Neal Freyman
Sounds like you're a pit boss at a Formula one race.
Toby Howell
Oh, I wish I'd take down Red Bull for sure. But no, Visibility and speed are in reference to Sage. If you are a finance pro, you need greater visibility and control over your entire business and Sage can give that to you.
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Toby Howell
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Neal Freyman
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Toby Howell
Head to sage.com for more info. That's sage.com if you thought the dating scene was tough right now the National Labor Relations Board is here to shake things up even more. The NLRB issued a complaint this week suggesting that the love seekers on the Netflix reality show Love is Blind who date one another whilst in separate rooms known as pods aren't just participants in a social experiment. They might actually be employees. It is the labor board's first time venturing into the messy world of reality tv, but comes after some of the show's onscreen personalities have advocated for change. If the NLRB gets its way, it could turn the reality TV world on its head. The show's contents are employees and not contractors. That could lead to unionization, better pay and and less restrictive non compete clauses. Neal maybe what these contestants need in their life was less blind love and more labor protections, right?
Neal Freyman
This could be an earthquake for reality tv. We've talked about the National Labor Review Board on the show before, but for the most part it's been in the context of industries like Starbucks unionization or Amazon unionization or auto workers. That's the first time they ventured into reality tv. There have been a number of lawsuits filed by former Love is Blind contestants and extends to other shows as well, accusing the producers of these shows of being abusive, exploitative and then putting all of these clauses in their contracts such as non competes and pay or leave, which is something like you have to pay a fine if you leave the show. So that really gets you in there. So they've chronicled a bunch of These exploitative practices that they, you know, that they're bringing to the National Labor Review Board. And there will be a final determination next year with whether reality TV show show contestants, at least on Love Is Love is Blind, are employees.
Toby Howell
So the world of reality TV show, there's a lot of wild stuff that happens on screen that's kind of par for the course. And it's what the producers of the show want. So these production companies that put on the shows always want to reduce their exposure, reduce their exposure to litigation because. So that's where you get these very tightly worded, these very tightly written contracts, usually with these confidentiality provisions, also with these other restrictions. And so one big one that the NLRB pointed out in relation to Love is Blind is that they have this non compete provision that says cast members cannot give interviews, they can't go on media on their own behalf or for any third party one year until after the last episode air. So it's a very restrictive non compete clause that kind of the contestants bristled against. They also had that, the no show fine, that if they left the show, they'd have to pay $50,000. And then also just the pay was a little low. Some people are saying they were getting $1,000 a week stipend. And if you went down through the amount of time they spent on set, they were making below minimum wage, $7 an hour based off of the entire time that they were working. So a lot of these different complaints added up and that's why the NLRB got involved.
Neal Freyman
And the companies are not going to, you know, go down quietly. They issued a response last year to one of these lawsuits. The show's creator said, we document the independent choices of adults who volunteer to participate in a social experiment. Their journey is not scripted, nor is it filmed around the clock. We have no knowledge or control over what occurs in private living spaces when not filming. And participants may choose to end their journey at any time. So that's the producer's side. They're saying, look, they signed up for this. We're giving them fame and celebrity and things like that. We signed a contract and this is what they agreed to. So that is, you know, the battle lines are being drawn. This will be resolved next year one way or the other. The big question mark is whether this is a huge reckoning for reality TV if they are classified as employees or whether it's a nothing burger. And that all depends on who Trump, you know, appoints to the National Labor Review Board because it is a, it is a commission made up of a bunch of different people. If you appoint a Republican, then this thing is going to be absolutely dead in the water and they're just going to go back to the way things were. But it does seem like there's a broader, what they call a reality reckoning around the Bravo verse right now. You know, Bethenny Frankel is probably one of the most famous Real housewives called for unionization among contestants last year. So there's a broad acknowledgment that perhaps reality TV contestants should be afforded more rights as, you know, compared to the other industries that everyone works in. Buzzfeed stole the studio behind the YouTube show Hot Ones for a non poultry sum of $82.5 million offlo one of its most prized assets in order to keep its struggling business afloat. So who bought it from buzzfeed? A consortium of investors led by an affiliate of Soros Fund Management acquired the parent company of Hot Ones called First We Feast and will run it as an independent entity. The show, in which Cool as a Cucumber host Sean Evans interviews celebs while they eat increasingly spicy chicken wings, has become a massive hit since its debut in 2015. First We Feast has over 14 million YouTube subscribers and does about $30 million in annual revenue. That's a nice business. But Buzzfeed has bills to pay, specifically a $120 million tab from debt and interest that came due last week. It's using the proceeds of the Hot Ones sale to pay that down. So it only has $30 million in debt remaining. Now Buzzfeed is in a much better place financially, saying it has a cash balance bigger than its total outstanding debt. Still, Toby, I have a lot of questions here. Hot Ones was the one thing buzzfeed had going for it. What's the strategy going forward? And for Hot Ones and First We Feast, what is the ceiling for them as an independent company? Please answer.
Toby Howell
I do think, I do think BuzzFeed had to, you know, cut off the arm to save the body. In this case, yes, Hot Ones was their buzziest and probably most well known property. But they are a business in decline right now. They had to make some cuts. They had to get some cash in the bank so they can make these interest payments. Now all that's left is buzzfeed, the actual site that you know from those listicles that and quizzes and celebrity news that used to do a lot of back in the day. They have HuffPost still, which is a news site and then they also have Tasty it's food Vertical. And that's it. Right now they got rid of Hot Ones. They are now moving into what their CEO Jonah Preddy calls new AI powered interactive experiences. So he is betting a lot on AI here. And I guess you can't have an AI version of Sean Evans. As for Hot Ones, they're joining Soros or a conglomerate of Soros companies, which sounds weird on the surface because George Soros is worth 7 over $7 billion. Has been this very big proponent of liberal causes. So why are they owning this celebrity interview show? They have been moving into the media space in past years. The Soros empire is now run by his son Alex. He acquired a minority stake in Crooked Media, which is the media company behind Pod Save America. They also have a controlling stake in Odyssey, which is this radio company. So they have been making inroads into the media company. This is now another crown jewel that they're adding to their portfolio.
Neal Freyman
And Hot Ones is, let's just put an emphasis on it, incredibly successful. I mean it is a destination stop on the press tour circuit. If you have a movie coming out then you absolutely go on this show. You were looking at some of the numbers this morning and they sometimes exceed the hundreds of millions for one episode.
Toby Howell
Yeah, Hugh Jackman, Ryan Reynolds went on to promote Dead Bull and Wolverine that pulled in 31 million views. Ariana Grande was recently on to promote Wicked. 8.3 million. Paul Mezcal only 1.9 million on Paul. Get those numbers up all time though. On the all time list. I was wondering who is the most famous Hot One guest and it is Gordon Ramsay with 129 million views. You are right though. It's almost replaced late night television as the go to stop. The de facto stop for if you are a celebrity because it is just has this very dedicated audience. It puts celebrities in a great scenario. Like you get to see them. Everyone's tried spicy food before, so it's very relatable. And then Sean Evans also asked like these great deep questions to them. So you are totally right that it's become part of the late night media apparatus in a way that I don't think anyone really could have foreseen when it started 10 years ago. New Jersey residents, are your neck sore. People living in the Garden State have reported a rash of mysterious drone sightings over the past few weeks, prompting wild explanations for their presence, ranging from foreign motherships to aliens. These drones have been described as larger than your typical hobbyist models and are often seen flying over critical infrastructure like reservoirs, airports and military bases. Witnesses describe the drones as being about the size of bicycles or even small cars, with some seen flying in clusters late at night. Understandably, residents have called on public officials to figure out what the heck is going on. Yesterday, the White House's national security communications adviser, John Kirby, assured the public that there is no threat to public safety or national security. But the same day, Senator Richard Blumensol said they should be shut down if necessary, a Sentiment shared by 2 New Jersey Area congressmen, Chris Smith and Jeff Van Drew, who've called on the military to shoot them down as well. The FBI has formally launched an investigation, asking residents to share any videos and photos they may have. It's become this whole thing, and the only consensus, Neal, is that nobody really knows what they are.
Neal Freyman
No. I was going down a deep thread last night, and there are so many more questions than answers. I think one thing you could probably point to is maybe some of them are just planes. There's a lot of private airports in New Jersey, and people might have this confirmation bias where they're knowing that others are seeing drones in their state. They might be seeing them as well and documenting just actual planes. But it does remind you a bit of the panic around the Chinese spy balloon where we sent, you know, an F16 to shoot down a hobbyist balloon that cost $10 with a Sidewinder missile. So there's a question of whether this is a panic. But also, at the same time, mayors and local officials are putting a lot of pressure on people at the national level to have more transparency, to actually look into this, because their residents are calling them and saying, we're seeing these drones. We're scared. We have no idea what's going on. The whole thing kind of blew up a little bit in mid November when drones were spotted near Picatinny Arsenal, which is a military research facility, and then over Bedminster, which is where Trump has his golf course. So those two things, and then you have officials saying they saw him over critical infrastructure as well, has led to a lot of nerves, and that is completely understandable. So you have this push and pull between local mayors saying we demand answers and federal officials saying there's maybe not much to see here, and we'll see what happens going forward.
Toby Howell
I mean, there is this background context of a increased interest in UFOs, but as the government classifies them as UAPs, which are unidentified, anomalous phenomenon, there have been two major hearings this year on USPs held in front of Congress, where leaders are just calling for greater transparency from the Pentagon. So I think you can't talk about these things without also talking around the greater interest in at the governmental level when it comes to UAPs, UFOs, whatever you want to call them. So until we figure out what this is, it still is just a big question mark. We were speaking this morning and they think the only possible explanation is just a hobbyist got a really big drone and it's just flying it around and people are freaking out about that. But until you have answers, then there's really nothing you can say other than the fact that you hope it doesn't, you know, impact national security or isn't a threat from another country, which the Pentagon has said it doesn't believe it is. But until one of these drones is, you know, taken down from the sky and examined, we just don't know. Up next, it's Stock of the Week Dog of the Week time brought to you by Indeed.
Neal Freyman
Job hunting is tough.
Toby Howell
Yeah, to put it lightly.
Neal Freyman
It may not seem like it, but employers are looking. Especially with seasonal needs arising around this time. It just takes some polishing up of your skills and resume to stand out to them.
Toby Howell
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Toby Howell
You've heard us talk about the Fed and falling interest rates in the past, so here's a refresher on what comes next. The Fed announced a rate cut and the plan is for more rate cuts later this year and in 2025, which means it's a great time to lock in a 6% or higher yield with a bond account at public.com public.com's bond.
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Get started at public.com morning brew that's public.com morning brew, brought to you by Public Investing member FINRA and sipc. The yield is the average annualized yield to worst across all 10 bonds in the bond account before fees as of October 3, 2024. Your yield to worst is not locked in until the time of purchase. A bond's yield to worst is not guaranteed. You can earn less if you do not hold the bonds to maturity or the issuer defaults. Not an investment recommendation. All investing involves risk. Visit public.com disclosure/bond account for more info. Welcome to Stock of the Week Dog of the Week, the Friday segment where Toby and I pick one stock that nailed the high note in defying gravity and another that had to take it down the octave. I won the pre show contest of who hosted yesterday, so I get to go first. And my Stock of the Week is Google or Alphabet, if you want to be a snob about it. Alphabet, Google's parent company, shot up more than 11% this week after the company released a new AI model that sets the stage for a universal personal assistant that can do pretty much anything you want for you. Oh, and there was also that quantum computer that proved the existence of the multiverse. But back to the AI stuff, because that's what get investors really foaming at the mouth these days. Google lifted the lid on Gemini 2.0, its upgraded AI model that lays the foundation for AI agents, which is like ChatGPT on steroids. While chatbots can provide answers to your questions and write bad novels, they require some handholding. AI agents are like a dog without a leash. They can complete tasks on their own and solve multi step problems without you giving them instructions every step of the way. Many leaders in the AI space see these agents as the industry's next big consumer application. And Google just threw its hat in the ring with Gemini 2.0. Let's talk about timing. None of these agents will hit your Chrome browser anytime soon, but they will come next year. And that seems good enough to placate investors who are seriously worried about Google Search losing its throne to AI upstarts like Chat, cbt and Perplexity.
Toby Howell
It really was a great week for Google. Go back to even earlier this year, and it seemed like the AI revolution was passing it by. It was falling behind in this critical race, but now a lot of things are going on at Google that will get you reason to be excited. They have another project called Project Astra, which introduces a virtual assistant, like a Siri, like an Alexa, that's slightly more natural to talk to. It can remember and refer back to past interactions. It also is teaming up with Samsung to try to take on Med in this resurgent market for smart glasses and VR headsets, which is ironic because we're almost a decade removed from its first attempt in Google Glass that went very, very poorly. It also rolled out this new AI called gencast, a weather prediction model. It can accurately predict weather forecasts 15 days in advance. And then you mentioned the quantum computing thing as well, the Willow chip that decreased the error rate involved in quantum computing. So all of a sudden we were just looking back at Google and say they rolled out a ton of products here that are doing very well and suddenly changed the entire narrative around this company when it comes to AI.
Neal Freyman
And it is still hypothetical because these things aren't going to be released to the public until next year. And then the quantum computer not going to come for, I don't know, decades. But it did kind of show investors that Google has its technical chops in order and that it can still provide, you know, technological breakthroughs. And that excited investors. Google Alphabet had lagged all of the Magnificent Seven peers up until a few weeks ago, and now it's doing much better, with investors super excited about some of these AI products and the fact that it may be able to change its business enough to hold off those competitors.
Toby Howell
My dog of the week is health care stocks. Following the spate of negative press connected to the assassination of UnitedHealthcare CEO Brian Thompson, names like CVS, Cigna and UnitedHealth Group continued to struggle. This week, a bipartisan group of senators pushed things from bad to worse when they introduced a bill that could result in the breakup of some of these health care giants. The bill goes after the middlemen of the drug world, pharmacy benefit managers. It would force health insurance companies and PBMs to break off their pharmacy businesses within three years or face penalties. Senator Elizabeth Warren said in a press release that the fact that health care companies can own both PBMs and pharmacies are, quote, a gross conflict of interest that enables these companies to enrich themselves at the expense of patients and independent pharmacies. So in addition to trading lower in the days after Thompson's killing, health care stocks are now facing some serious heat in Congress as well.
Neal Freyman
Yeah, UnitedHealth Group, Cigna, and CVS Health are all down at least 10% this week. There's just a lot of negative sentiment around the health care industry right now. Both, all three of those operate huge insurance arms. And then they also have the largest PBMs, which are the drug supply chain middlemen. Collectively, those three companies or those three PBMs operate 80% of the nation's prescriptions. And the pitchforks have been out for PBMs for a while. The FTC started looking to that, looking at them in 2022. So there does seem to be appetite for health care reform right now, which was not talked about at all during the presidential campaign. I don't think they asked a single question about it at any of the debates. What are you going to do with the health care system? But all of a sudden, after this assassination, it's come to the fore as a majority talking point here. And we'll see whether, you know, it's very unclear whether this specific bill will gain traction. But for, you know, an issue that certainly wasn't top of mind, it will be now in the years going forward. And we'll see whether the Trump administration decides to take that popular mandate and do something on it. We know that his Health and Human Services secretary, rfk, really does not like the big health care industry. So we'll see if there's any reform there. But, yeah, there's certainly a lot of, you know, negative attitudes towards health care industries right now, and their stocks are plummeting as a result.
Toby Howell
Yeah, I mean, you just got to go and look at what the people are saying. A Gallup poll said that only 19% of Americans are satisfied with the cost of health care. I think a lot of people would say, who are that? 19%. Because a lot of people do feel like the system is not built to, you know, support the people who need the care their most. And then all you have to do is point to the stock gains that these companies have seen in the past two decades over the last 20 years. UnitedHealth Group, it's up 1,200%. Cigna is up 4,000% over the same time period. But then you look at the life expectancy numbers in the US and those have stayed flat, which is part of the reason why people are so frustrated with this particular industry right now.
Neal Freyman
Let's sprint to the finish with some final headlines. President Elect Trump was named Time magazine's Person of the Year for the second time. And to celebrate, he rang the opening bell at the New York Stock Exchange to kick off the trading day. It was a jubilant scene with loads of finance execs in attendance, including Goldman Sachs CEO David Solomon, Citigroup's Jane Frazier, and Pershing Square's Bill Ackman. They're excited about Trump's second stint in the White House because his administration is expected to cut taxes, deregulate companies and spur more merger activity, all things that would seemingly benefit Wall Street. Here's an interesting fact though. Despite being a New Yorker and being in the business scene for decades, Trump's never rung the opening bell before the stock exchange started inviting guests to do it. Starting in 1965 with a 10 year old who won a stock market quiz show.
Toby Howell
Oh, that is a good fun fact. Actually. I've always wanted to ring the bell. We have been to the New York Stock Exchange. It is a very cool place. I do want to talk about him winning Time magazine's Person of the Year, though. There were some people saying it comes with an asterisk because tell me if you think that he's a system Time Person of the Year candidate because each of the last seven presidential election years and four of the seven before that have been named Time Person of the Year, whoever won the White House became Time Person of the Year. So all you got to do is win the win the White House, which I mean, I guess is a quite defeat to be named Time Person of the Year. The President seems to have an inside track to that award. YouTube TV, you done messed up. The streaming TV provider set off a firestorm of negativity yesterday after it announced another price hike, bringing its monthly cost to $83, a 137% increase from its 2017 launch price. The $10 hike has subscribers seeing red and set off this big brouhaha online with a lot of people citing YouTube TV shift from an affordable streaming alternative to what feels a lot like traditional cable pricing. To add insult to injury, there's no real new content or features to justify this cost increase. So a lot of people were left wondering if the service is even worth it anymore.
Neal Freyman
There's no new content, but it seems like they do have to pay their bills. And YouTube TV paid $2 billion per year to the NFL for the exclusive rights of Sunday ticket. And now it wants customers to help them pay that down. But you're right, this is a shockingly huge increase. $10 per month increase that amounts to hundreds of dollars over the year. I guess we are going to get to a point where customers are going to, you know, leave and go to other streaming platforms because at this point there is absolute parity between the new guard of pay TV and the old guard of the cable bundle. And it's really hard to see the difference at this point.
Toby Howell
That's why the Internet always has a field date with these price hikes, because it is so easy to compare it to cable and how streaming has reinvented cable and just branded it differently. So I think that's why you see so many jokes. But also, people can remember the price that YouTube TV debuted at, which was $35 a month. That was a game changer because it was both a probably superior service because you could watch it on whatever device it was very accessible, but it was also a superior price. Now it seems like the price the product hasn't innovated that much, but the price has gone up exponentially.
Neal Freyman
Still, the predictions are that it will eclipse Comcast in 2026 as the country's largest pay TV provider. So there's that. What do Michael Jordan, Rob Gronkowski and Jim Carrey have in common? They all came out of retirement. Jim Carrey returned to work to voice Dr. Robotnik in Sonic the Hedgehog 3 opening next week. But the legendary actor did so for a fairly commonplace reason. He needed the money. In an interview on the red carpet before the movie's London premiere, Kerry said he came back first of all because he gets to play a genius. And also, quote, I bought a lot of stuff and I need the money. Frankly, it's a U turn for a guy who said he was retiring from the game. Two years ago in 2022, he told the Hollywood Reporter, I really like my quiet life and I really like putting paint on canvas and I really love my spiritual life. And I feel like I have enough. Apparently not.
Toby Howell
Apparently not. You said you just went to Wicked and in the previews you saw Sonic 3 advertising, you saw, you heard Jim Carrey's voice, which is what set off kind of like this whole headline because it makes sense. He seems like someone who wouldn't need to work anymore. He has quite the movie catalog. But you know, money doesn't grow on trees unless you suddenly wake up and become God, as Jim Carrey has once done before. But now that we're talking Jim Carrey, I need to know your favorite Jim Carrey movie.
Neal Freyman
I mean, I do love the Ace Ventura ones. Those are so funny. Well, I know I will like Eternal Sunshine of the Spotless Mind better. I just haven't seen it yet. But that movie is totally up my alley. I hear amazing things. So once I watch that, that will certainly rise in the power rankings. But for now, it's Ace Ventura.
Toby Howell
It was interesting to see Jim Carrey as the person who came out and said I needed the money here because he has been like very happy in his retirement or seems like he left everything behind. But you know, the bills do rack up and you you got to have money to pay him.
Neal Freyman
Well, apparently you know how he wants to paint and stuff. Apparently his artwork is not very good. The Guardian reviewed it and said it was astonishingly bad and a joke. So maybe that wasn't the right career path for him in retirement. That is all the time we have. Thanks so much for starting your morning with us. Have a great Friday and an even better weekend. For any questions, comments or feedback, send an email to Morning Brew daily at Morning Broadcom. And don't forget to share the podcast with friends, family and co workers who could use a quick hit of business news in the morning for some sharing Inspo Ahead of the weekend, Toby's here with an idea.
Toby Howell
I want you to share this podcast with someone who's been having a little bit of background luck recently. It is Friday the 13th. Someone in your life has probably been going through it, so toss on this episode to cheer him up and let them know things do turn around.
Neal Freyman
Let's roll the credits. Emily Milian is our Executive producer. Raymond Liu is our producer. Olivia Graham is our associate producer. Uchenna Wagu is our Technical director. Billy Menino is on audio, hair and makeup has come out of retirement. Devin Emery is our Chief Content officer, and our show is a production of Morning Brew.
Toby Howell
Great show today, Neil. I wish you all well.
Morning Brew Daily: Are Reality TV Stars…Employees? & ‘Hot Ones’ Sold For $82M
Release Date: December 13, 2024
Hosts: Neal Freyman and Toby Howell
Overview
In this episode, Neal and Toby delve into the National Labor Relations Board's (NLRB) groundbreaking complaint against Netflix's reality show Love is Blind. The NLRB is questioning whether participants on reality TV should be classified as employees rather than contractors, a move that could have far-reaching implications for the reality television industry.
Key Discussions
NLRB's Complaint: The NLRB has filed a complaint suggesting that participants on Love is Blind are employees. This classification could open the door to unionization, better pay, and the removal of restrictive non-compete clauses.
Neal Freyman [04:21]: "If the NLRB gets its way, it could turn the reality TV world on its head."
Impact on Contracts: Reality TV contracts often include stringent non-compete clauses and penalties for leaving the show early. Contestants on Love is Blind faced fines of up to $50,000 for departing the show and received stipends that some argue are below minimum wage when accounting for time spent on set.
Toby Howell [05:24]: "They cannot give interviews, they can't go on media on their own behalf or for any third party one year until after the last episode airs."
Producer's Stance: Producers argue that participants are independent adults who sign up for a social experiment, deny constant filming, and claim minimal control over participants' private lives.
Neal Freyman [05:12]: "We document the independent choices of adults who volunteer to participate in a social experiment."
Future Implications: The final determination by the NLRB is expected next year and could set a precedent for how reality TV contracts are structured across the industry.
Neal Freyman [05:12]: "This will be resolved next year one way or the other."
Insights & Conclusions
The classification of reality TV participants as employees rather than contractors could revolutionize the industry, potentially leading to better working conditions and compensation for contestants. This move aligns with broader labor movements advocating for workers' rights across various sectors.
Overview
BuzzFeed has sold its popular YouTube series Hot Ones to a consortium led by an affiliate of Soros Fund Management for $82.5 million. This strategic move aims to alleviate BuzzFeed's financial burdens, particularly its $120 million debt.
Key Discussions
Sale Details: Hot Ones is a flagship series for BuzzFeed, enjoying over 14 million YouTube subscribers and generating approximately $30 million in annual revenue.
Neal Freyman [08:10]: "Buzzfeed is using the proceeds of the Hot Ones sale to pay down that debt."
Future of Hot Ones: The show will continue to operate as an independent entity under the new ownership, potentially expanding its reach and content offerings.
Toby Howell [09:07]: "Hot Ones is joining Soros or a conglomerate of Soros companies, which sounds weird on the surface."
BuzzFeed's Strategy: With Hot Ones sold, BuzzFeed is refocusing on its remaining assets like HuffPost and Tasty, while also exploring new AI-powered interactive experiences as per CEO Jonah Peretti.
Neal Freyman [08:10]: "They are now moving into what their CEO Jonah Peretti calls new AI powered interactive experiences."
Soros Fund Management's Media Expansion: The acquisition aligns with Soros's increasing investments in media companies, including a stake in Crooked Media and Odyssey Radio.
Toby Howell [09:07]: "They have been making inroads into the media company. This is now another crown jewel that they're adding to their portfolio."
Insights & Conclusions
The sale of Hot Ones marks a significant shift for BuzzFeed, signaling a strategic pivot towards leveraging artificial intelligence and other technological advancements to sustain and grow its business. For Hot Ones, new ownership could mean enhanced resources and opportunities for further growth.
Overview
Residents of New Jersey have reported numerous sightings of unusually large drones over critical infrastructure, spurring fears and calls for governmental action. The FBI has initiated an investigation to determine the origin and purpose of these drones.
Key Discussions
Drone Characteristics: Witnesses describe the drones as sizable, comparable to bicycles or small cars, often seen flying in clusters near reservoirs, airports, and military bases.
Neal Freyman [11:00]: "These drones have been described as larger than your typical hobbyist models and are often seen flying over critical infrastructure."
Government Response: While the White House's National Security Communications Adviser, John Kirby, downplayed the threat, local officials and senators are pressing for decisive action, including military intervention to neutralize the drones if necessary.
Neal Freyman [11:54]: "Senator Richard Blumensol said they should be shut down if necessary."
Public Sentiment: The surge in drone sightings has heightened public anxiety, especially given the recent panic over the Chinese spy balloon incident. Officials are torn between addressing public fear and providing concrete answers.
Toby Howell [14:19]: "It reminds you a bit of the panic around the Chinese spy balloon... But at the same time, mayors and local officials are putting a lot of pressure on people at the national level to have more transparency."
Potential Explanations: Speculations range from foreign espionage to hobbyist activities, but no definitive explanation has been provided. The FBI is collecting evidence through videos and photos to aid their investigation.
Neal Freyman [12:54]: "It could be just planes... But the pressure is on for more transparency."
Insights & Conclusions
The mysterious drone sightings in New Jersey underscore the growing public concern over unidentified aerial phenomena (UAPs) and the need for greater governmental transparency. The outcome of the FBI's investigation remains to be seen, but the incident highlights the delicate balance between public safety and governmental reassurance.
Overview
Alphabet Inc., Google's parent company, was highlighted as the stock of the week due to its significant advancements in artificial intelligence (AI) and quantum computing, which have bolstered investor confidence.
Key Discussions
AI Innovations: Alphabet unveiled Gemini 2.0, an advanced AI model poised to revolutionize personal assistants by enabling autonomous task completion and complex problem-solving.
Neal Freyman [18:00]: "Google lifted the lid on Gemini 2.0, its upgraded AI model that lays the foundation for AI agents."
Quantum Computing Breakthrough: The introduction of the Willow chip has reduced error rates in quantum computing, signaling potential future applications in various technological fields.
Neal Freyman [19:09]: "The Willow chip decreased the error rate involved in quantum computing."
Market Performance: Following these announcements, Alphabet's stock surged over 11%, reflecting strong investor optimism about the company's technological trajectory.
Neal Freyman [18:00]: "Alphabet shot up more than 11% this week after the company released a new AI model."
Future Prospects: While these technologies are not yet commercially available, they demonstrate Alphabet's ongoing commitment to innovation, potentially safeguarding its market dominance against AI competitors.
Toby Howell [20:14]: "Google just threw its hat in the ring with Gemini 2.0."
Insights & Conclusions
Alphabet's strategic investments in AI and quantum computing have reinvigorated its market performance, positioning the company as a formidable player in the ever-evolving tech landscape. These advancements not only promise future growth but also reinforce Alphabet's capability to lead in technological innovation.
Overview
Health care giants like UnitedHealth Group, Cigna, and CVS Health are experiencing significant declines in their stock values amidst political scrutiny and negative press following the assassination of UnitedHealthcare CEO Brian Thompson.
Key Discussions
Legislative Challenges: A bipartisan bill introduced by senators aims to dismantle parts of these health care conglomerates by targeting pharmacy benefit managers (PBMs). The bill proposes forcing insurance companies and PBMs to separate their pharmacy businesses within three years or face penalties.
Neal Freyman [21:44]: "Senator Elizabeth Warren said... it's a gross conflict of interest that enables these companies to enrich themselves at the expense of patients."
Market Reaction: In response to both the political pressure and negative press, stocks of UnitedHealth Group, Cigna, and CVS Health have plummeted by at least 10% this week.
Neal Freyman [21:44]: "UnitedHealth Group, Cigna, and CVS Health are all down at least 10% this week."
Public Sentiment: With only 19% of Americans satisfied with health care costs, the push for reform reflects widespread frustration with the current system, especially regarding the role and practices of PBMs in the drug supply chain.
Toby Howell [23:07]: "A Gallup poll said that only 19% of Americans are satisfied with the cost of health care."
Industry Impact: The proposed legislation could force major health care companies to restructure, potentially leading to increased competition and better pricing for consumers, but also triggering significant market upheaval.
Neal Freyman [21:44]: "Health care stocks are now facing some serious heat in Congress as well."
Insights & Conclusions
The intersection of political action and public dissatisfaction is placing immense pressure on major health care companies, leading to steep declines in their stock prices. The proposed legislation targeting PBMs could reshape the health care landscape, fostering greater transparency and potentially more favorable conditions for consumers.
a. President-Elect Trump Named Time's Person of the Year
Donald Trump has been named Time magazine's Person of the Year for the second time. In celebration, he rang the opening bell at the New York Stock Exchange, signaling optimism from Wall Street leaders who anticipate tax cuts, deregulation, and increased merger activity under his anticipated administration.
Neal Freyman [23:07]: "Despite being a New Yorker and being in the business scene for decades, Trump's never rung the opening bell before."
b. YouTube TV's Controversial Price Hike
YouTube TV announced a significant price increase, raising its monthly subscription cost to $83, a 137% rise since its 2017 launch. This move has sparked widespread backlash as consumers question the value proposition, especially in the absence of new content or features to justify the hike.
Toby Howell [24:35]: "It's a shockingly huge increase. $10 per month increase that amounts to hundreds of dollars over the year."
c. Jim Carrey Comes Out of Retirement for Sonic 3
Actor Jim Carrey has returned to voice Dr. Robotnik in the upcoming Sonic the Hedgehog 3, citing financial needs despite previously expressing contentment with his retirement and artistic pursuits in painting.
Neal Freyman [27:55]: "Jim Carrey returned to work to voice Dr. Robotnik in Sonic the Hedgehog 3 opening next week... 'I need the money.'"
Neal Freyman [04:21]: "If the NLRB gets its way, it could turn the reality TV world on its head."
Toby Howell [05:24]: "They cannot give interviews, they can't go on media on their own behalf or for any third party one year until after the last episode airs."
Neal Freyman [18:00]: "Alphabet shot up more than 11% this week after the company released a new AI model."
Toby Howell [23:07]: "A Gallup poll said that only 19% of Americans are satisfied with the cost of health care."
Neal and Toby navigated through a spectrum of pressing issues, from labor rights in reality TV to the financial maneuvers of major digital content creators, and public safety concerns over drone sightings. Their insightful analysis provides listeners with a comprehensive understanding of the current business and economic landscape, emphasizing the interconnectedness of media, technology, and policy.
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