← The Town with Matthew Belloni
The Town with Matthew Belloni
The 3 Biggest Stories in Music: Bieber’s Payday, Ye’s Comeback, and $64B for Universal Music Group
00:32:18
Loading summary
Transcript145 lines
- [00:00]
A
Foreign. This episode of the Town is presented to you by AMC Networks. Billy Magnuson and Zach Galifianakis star in the new series the Audacity on AMC and amc. Plus, influence rises, people unravel, and CEO meltdowns are business as usual among Silicon Valley elite. Executive produced by Jonathan Glatzer, a writer, producer of Succession and Better Call Saul. Watch new episodes of the Audacity Sundays exclusively on AMC and AMC. Plus
- [00:34]
B
this episode is brought to you by TaxAct. Taxes trust me, they sound far more complex than they actually are. And it's all thanks to TaxAct. They make it easy to do taxes online, offering step by step guidance so you can finish your taxes ahead of the April 15 deadline and get your maximum refund guaranteed. If you get stuck, just add expert assist. Get unlimited help from a credentialed US based tax expert. Visit taxact.com to learn more.
- [01:02]
A
It is Monday, April 13th. So how much is the world's largest music label worth? About $60 billion, according to Bill Ackman, the billionaire investor. He and his Pershing Square Capital would like to engineer a deal to buy Universal Music Group, home to Taylor Swift, Bad Bunny, Kendrick. They've got the Beatles, now Justin Bieber, more than 30% of the market for recorded music, plus a huge music publishing unit. That $60 billion number would be a valuation a huge premium on what UMG currently trades at.
- [01:34]
C
But why?
- [01:34]
A
What is his interest here and what does it say about the overall trajectory of the music business? Ackman has been pretty interested in UMG for years now. He was even on the board. But he says, quote, UMG's stock price has languished due to a combination of issues that are unrelated to the performance of its music business. And importantly, all of them can be addressed with this transaction.
- [01:55]
C
Hmm.
- [01:56]
A
Okay, lots to discuss there. And it's one of a bunch of interesting music topics going on right now. There's Ye, the artist formerly known as Kanye West. He's been trying a comeback tour from quasi cancellation after his outbursts about Hitler and releasing a song called Heil Hitler. Yes, that happened. He apologized in newspaper ads and then he played a couple very big stadium shows in la. They went fine, gross record numbers. But then he was booked to headline a festival in London and the UK government basically blocked him from entering the country. So where does that leave one of the most influential artists of the past 25 years, all the potential partners like Live Nation that would very much like to make money off of him? We'll get into that, as well as some Coachella Stuff, the Bieber performance in particular. Our Monday guy, Lucas Shaw is here from Bloomberg. It's a music business check in. The hostile bid for Universal, the Yay comeback tour, the business behind Bieber, all of it from the ringer and Puck. I'm Matt Bellamy and this is the town. Okay. We are here with Lucas Shaw from Bloomberg, returning after a week off. You were not taking the week off to prepare for Coachella, were you?
- [03:07]
C
I. You know, I haven't been to Coachella
- [03:09]
A
in three or four years, man. Don't tell me you've aged out of that. People in their 30s in Los Angeles, there is a social contract that you must go to Coachella.
- [03:18]
C
I would go. I had a lot of other travel that I had to do this year.
- [03:22]
A
I know I was sad that there was no rain. I would have liked to see Justin Trudeau and Katy Perry consumed by a river of mud. But I did see a video where Kourtney Kardashian's wellness tent got blown down by a sandstorm. So a little bit, I feel like
- [03:37]
C
this was a big Kardashian Coachella because, you know, between Haley. The Haley Bieber, Justin Bieber access. So then you had Kendall Jenner there. You had Kylie Jenner promoting her stuff. It was just, you know, lot of. Lot of Kardashian.
- [03:49]
A
Yeah, that's okay. So you mentioned Bieber, and we're going to talk about a bunch of music industry things today. It's high time we checked in. But the Bieber performance, very controversial on social media and there was some chatter about the financials, and I thought that was an angle for us here. Very well known. Bieber got $10 million to perform at Coachella to seemed to do a lot of YouTube scrolling on stage. He played some of the new songs and then he went to his laptop and started scrolling YouTube and playing songs and then kind of singing along to the songs. And a number of people have wondered whether, A, YouTube paid him to do that and B, whether there was some kind of rights issue that he had to get around because he sold his catalog last year. And let's just put those rumors to bed. Can you do that?
- [04:44]
C
Yeah. I think this is a whole lot of nothing based on things I've heard, but I haven't had. I would hesitate to report it myself in a story like there has been a lot of speculation about money that Bieber owes in particular actually to his concert promoter. To the concert promoter aeg, which.
- [05:01]
A
Oh, I've been reporting on that. He's. He owes like 20 something million dollars, though.
- [05:05]
C
Tens of millions of dollars for a cancer, a concert that. A tour that was canceled. It just so happens that he played Coachella, which is put on by Golden Voice, which is partially owned by AEG. So, yes, he may have gotten $10 million. I wouldn't be shocked if some of that just goes right back to Golden Voice and AEG.
- [05:21]
A
And keep in mind that YouTube paid a lot of money for the exclusive streaming rights to Coachella.
- [05:26]
C
Sure.
- [05:27]
A
YouTube may or may not have suggested that it would be nice if there'd be a YouTube moment on stage with Bieber.
- [05:35]
C
He did sell his catalog to a company called Hypnosis that's owned by Blackstone. He got a lot of money for it, and it was widely seen that he did that because he needed money just to support his.
- [05:47]
A
His lavish lifestyle, the lifestyle to which he's become accustomed.
- [05:50]
C
Yes. But the notion that he, like, played videos off of YouTube to, like, nickel and dime or affect who he's paying for his performance is ridiculous because the amount of money that goes to the performing rights organization for that song being performed at Coachella is so minuscule relative to the amount he's getting paid. It just. It just. I think he just had a fun, creative idea or someone on his team did, and we're like, you know, you got your start on YouTube. Why don't we do it this way? Like, it'll be fun for people to go back and hear your old songs. And also for you who have struggled a little bit with your mental health, this is like, an easy way for you to sit on stage and scroll and have some fun, and it feels relatable and approachable.
- [06:34]
A
And earn $10 million. Yeah. I mean, the one. The one wild card is that, you know, he was singing along to the master recordings, which are owned not by him. So someone's getting paid there. And maybe, you know, YouTube has a license. YouTube has a blanket license.
- [06:54]
C
Yes, YouTube has license. So the. The owners, by the way, he's not. It's not like he's the sole owner. Universal Music also owns a bunch of it. And so, yes. Did Universal get, like, a little bit of money because that was played on YouTube. Yes, but we are talking about pennies on the dollar. Nothing that matters for the $10 million that. That he got paid.
- [07:13]
A
All right, well, good for him. Good for everyone involved. Seemed like a great event. Lots of paparazzi photos, lots of Dumois action. So we're happy for everyone. All right, speaking. Speaking of money and Universal Music Group, Bieber's label, our guy Bill Ackman, billionaire, our guy, Twitter gadfly, very opinionated billionaire. He would like to own Universal Music Group. And this is not new. He's been making noises about this for years. He was actually on the board of UMG at one point. I don't understand a, the financial machination and why this matters. Like why does Bill Amman want to own umg? What about the music industry is saying, yes, I want to be there and I, and I think I can run this more efficiently. He says that in his statement that UMG's stock would go up markedly if he were owning it. I, I, I don't understand this.
- [08:10]
C
Can I, this is my, this is my somewhat hot take. Bill Amman does not want to own Universal Music Group.
- [08:15]
A
Oh.
- [08:15]
C
He just wants someone else to buy it at a, at a higher price. Now maybe if Bill Amman could buy it and merge it with his SPAC and, and, and have that like solve some financial problems for him, that would be great. But I think more than anything he knows like the, the French family, the Bol Zone, a piece of it. 10 cent owns a piece of. Bill Ackman is not going to own all of Universal Music Group. But he's pissed because he bought it at, at a price that's higher than it's currently trading at. Universal Music Group as a public company has not worked. One could even say it's a failure. The stock price is down from when it went public. That is not what you want to have happen.
- [08:53]
A
But why is it a failure?
- [08:54]
C
Why is the stock not doing well? Yeah, because the record label is in a very perilous situation at the moment. I'd say like the big headline reason right now is fear about AI and like what's that gonna mean to a record label? But it's also, look, you know, their share of overall consumption is going down because independent music keeps eating more and more share. It's why the major music companies, Sony, Universal, Warner have all tried to buy independent distributors where the margins aren't as good, but it'll prop up their market share. The major music artists like the Biebers are not giving them as much ownership. They are demanding ownership earlier or from the outset of their contract. So Taylor Swift, Universal Music's biggest artist. Universal Music's not going to own her records in the long term, right?
- [09:39]
A
No, but Taylor is the anomaly, Right? Explain that part about how younger artists are able to negotiate more of their masters than they once did. Why is that the case now?
- [09:49]
C
Because they usually go viral before they get signed or have a little Bit of buzz before they get signed.
- [09:55]
A
It's just the power to break an artist has completely shifted to the platforms. And when you shift that power to the platforms, it gives the artists more power to negotiate with their label.
- [10:09]
C
The most valuable thing these music companies own is their catalog. Right? Because if you own catalog and it's just passively making money, that's pure profit for you. It's the same reason a movie or TV studio, the most valuable thing they own is their catalog because they don't have to do anything to make money from it.
- [10:22]
A
Well, and the share of catalog listening has been going up. Craig is listening to ABBA and credence from the 70s.
- [10:29]
D
Damn straight.
- [10:30]
C
I thought you were going to say Creed there, which would make me really rethink things with Craig.
- [10:34]
A
I don't know about Creed. I cannot vouch for that. But. But I do know that Craig listens to a lot of ABBA and a lot of credence. Those are two artists that a normal 30 year old guy 20 years ago would not be listening to. But now because of they're all ubiquitous and the algorithm chooses you. It found him and he loves it.
- [10:53]
C
I don't totally agree with that because I think 30 years ago you. The difference is he would have owned it on CD if you liked it and he would have listened to it that way.
- [11:02]
A
But he never would have discovered it
- [11:04]
C
or he would have heard it on radio.
- [11:06]
A
Yeah, okay. He would have heard it on a classic music radio station and that would have been enough for him.
- [11:12]
D
The bar is way lower now for me to discover a great Fleetwood Mac song I didn't know before.
- [11:16]
A
Yeah, exactly. And why do you think the share of catalog music is going up so much?
- [11:21]
C
Part of it is the, the, the generational adoption of streaming. So at the beginning of streaming it was younger people mostly listening to newer music. And as time went on, you had older people who are already listening to older.
- [11:34]
A
They're just aging up. Someone like me. If you are Gen X and you now have access to all the songs you loved when you were 20 and you don't have to buy them, it's great. The pie has expanded so that I'm giving money to those artists that I loved when I was 20.
- [11:53]
C
Yeah. My argument has been all along has been that the majority of listening has always been to catalog. It just took a while for the streaming data to reflect it. And it does mean something financially to. Because you are getting paid for every stream as opposed to like someone buying a CD and then it just sits on your shelf. And even if you listen to it, the artist doesn't get paid every time you listen to it.
- [12:12]
A
Yeah. I mean, the entire economics of the music business have changed because of streaming. It's just surprising to me that the labels haven't been able to translate that into a better narrative for Wall Street.
- [12:27]
C
Yeah, well, look, they surrendered a lot of the control over their destiny to these streaming services. Right. Like one of the best ways for the music companies to make money right now is for the, the, the streaming services to raise their prices and they have some ability to sort of try to make that happen. But that's ultimately up to Spotify, Apple, YouTube, they haven't really invested in technology. So like there a lot of the concern about AI right now. If Suno, which is the biggest AI company, were something that the labels had incubated, nobody would be worried about it. Right. But instead it's this outsider that is once again seen as a threat because the record label's role in the music business has just contracted over time.
- [13:04]
A
Yeah. Interesting though. One of Ackman's proposals is to sell UMG stake in Spotify for 1.5 billion euros. If the future of the music business is the platforms, why does Ackman want to sell Spotify?
- [13:20]
C
He just seems very eager for them to spend more money and be more aggressive. Right. He's talked, he wants Universal to take on more debt. I mean, the interesting thing about all this is Bill Ackman actually likes the current management of Universal Music Group.
- [13:34]
A
Yeah, they were very quick to put out a statement supporting Lucian Grange, the CEO, but he's not saying replace the management.
- [13:40]
C
Yeah, he's not really saying replace the management. And he's not really even saying change the strategy for music. Right. He acknowledges that Lucy and Grange has been the, the best record executive of his era. Just like tremendous track record. They dominate the business in a lot of ways. He's. A lot of his arguments are around how, how they're like allocating capital and how they're communicating with investors. Because to your initial question, they' done a really poor job of convist convincing investors that they have a kind of a positive growth story. And that's either because of some of the stuff we've discussed where like there isn't a positive growth story or it's because they've just been bad at investor communications because none of them have any experience really being at a public company.
- [14:18]
A
Well, it's like the narrative in Hollywood. You know, Warner Brothers discovery is in the toilet until someone wants to vastly overpay for them and then the stock triples.
- [14:28]
C
Right. And that's I think what Ackman is basically hoping here is that someone will come along and offer a shit ton of money for Universal and, and suddenly he'll make a huge amount of money on his trade.
- [14:38]
A
Yeah. And do you think this impacts the other two large record label conglomerates?
- [14:43]
C
It impacts them if it trades.
- [14:45]
A
Yeah. If, if there is a $60 billion valuation on UMG, that's pretty good for Sony and Warner.
- [14:53]
C
I think most of the other companies, even though it's like it's very annoying if you're the management at umg, most of the people in music business see it as a net positive because it should increase the value of what they do and it might even also force. Force some change in, into how these companies operate.
- [15:11]
A
And if he's successful, what a huge coup for Michael Ovitz. Mike Ovitz basically banished from Hollywood after his CAA run and went to Disney and then started a management company and CA blackballed him. He's been in the investment community for two decades now, making a lot of money, buying a lot of art. He popped up in this proposal as someone that Bill Ackman wants to be chairman of the board. What, what, what's going on there?
- [15:37]
C
He's good friends with Lucy and Grange. So I think it was also positioned as a we can be. You know, this is not hostile.
- [15:42]
A
I mean it'd be really funny. I think that's exactly what's going on.
- [15:45]
C
It'd be, it'd be really funny because if you had Michael Ovitz on the board, Sherry Lansing is already on the board. You'd basically be running back Hollywood in the 1990s or even the 80s. Just like the power brokers of three decades ago are now in charge of the world's most powerful music company.
- [16:04]
E
Are you looking for support in your weight management journey? Zepbound Tirzepatide may be able to help. Zepbound is a prescription medicine used with a reduced, reduced calorie diet and increased physical activity to help adults with obesity or some adults with overweight who also have weight related medical problems to lose excess body weight and keep the weight off. Zepbound is Approved as a 2.5, 5, 7.5, 10, 12.5 or 15mg injection. Zepbound contains Tirzepatide and should not be used with other Tirzepatide containing products or any GLP1 receptor receptor agonist medicines. It is not known if Zephound is safe and effective for use in children. Don't share needles or pens or reuse needles. Don't take if allergic to it or if you or someone in your family had medullary thyroid cancer or if you've had multiple endocrine neoplasia Syndrome Type 2. Tell your doctor if you get a lump or swelling in your neck. Stop Zepbound and call your doctor if you have severe stomach pain or a serious allergic reaction. Severe side effects may include inflamed pancreas or gallbladder problems. Tell your doctor if you experience vision changes before scheduled procedures with anesthesia. If you're nursing pregnant, plan to be or taking birth control pills. Taking zepbound with a sulfonylurea or insulin may cause low blood sugar. Side effects include nausea, diarrhea and vomiting, which can cause dehydration and worsen kidney problems. Talk to your doctor, call 1-800-545-5979 or visit zepbound Lilly.com this episode is brought
- [17:36]
B
to you by the Home Depot. Spring is starting, so it's time to wake up your yard. And at the Home Depot, they've got everything you need to do it. With low prices, guaranteed, mowing your lawn is a dream. With top brand outdoor power tools like the Ryobi 40 volt mower with up to 50 minutes of runtime, you can add a pop of color with spring blooms and fresh plants and refresh your garden beds with Earth Grow Mulch. Five bags for just $10. Start your spring with low prices now through April 1st. Available at the Home Depot. Exclusions apply. See home depot.com price match for details.
- [18:15]
A
Speaking of power, let's talk about the artist formerly known as Kanye West. We will refer to him as Yay. That is his chosen name. Now, you've done some reporting on this subject, and I'm sort of fascinated from a different perspective, from the kind of perspective of what are the options for someone that has been canceled, quasi canceled. We've seen examples of this pop up. Louis CK Is now headlining a Netflix event.
- [18:42]
C
Cancellation is over. People are back.
- [18:44]
A
Is it though? Like, that's the thing is that I read your story from a couple weeks ago about how, how yay made, what was it, $33 million off of two
- [18:52]
C
shows in two nights.
- [18:54]
A
Yeah, that's pretty good for two LA shows. $33 million in gross gate revenue. To me, that says not canceled. Then he goes off and heads to
- [19:04]
C
London or tries to head to London or.
- [19:06]
A
He never actually went.
- [19:06]
C
Yeah, I don't think. I don't think so.
- [19:08]
A
They said that he would not be welcomed into London because of his pretty openly anti Semitic rhetoric. Then the festival he was going to headline was canceled. So where does that leave him? And more specifically, I want to talk about where does that leave Live Nation, which very much wanted to be in business with him.
- [19:27]
C
He is going to keep doing shows. I just don't know that he's going to go to the uk. I suspect he already performed in Mexico City. He performed in la. They were both really successful. I think it's just a matter of time before they announce more dates, probably somewhere else in the us. There are plenty of countries around the world that I imagine will take sort of less of a hard line on his stance, especially if they see how much money he's making and how much they stick to benefit from it. So, yeah, I mean, he's in this, this kind of interesting limbo right now where the album has done pretty well. The, the concerts have done quite well.
- [20:02]
A
And Spotify and Apple will platform him.
- [20:04]
C
They are sort of cautiously platforming him. They, they will, they've playlisted him, but they're not doing sort of big promotional campaigns like they do for a Dua Lipa or a Harry Styles.
- [20:15]
A
He's not sitting down with Zane Lowe's. No.
- [20:17]
C
It's like a cautious embrace and it's. All of this is dependent on like, is he going to keep behaving or is he going to have another outburst? But there is clearly a huge percent of the population that's cool with him and then there's a lot of the population that is still wary and doesn't trust him.
- [20:34]
A
Brands, though, can't be anywhere near this.
- [20:36]
C
Still pretty toxic. Yeah, I think it's tough for them, the brand look, brands are always last, right? The brands are going to follow the people. If he does like a, you know, if he does 6, 8, 10 more stage shows and they all do well and the album does well and he manages to continue to pull off sort of his apology tour. I could see brands getting back in business with him, but I don't see that being this year. That's like a year or two down the line as he's become a little more accepted. And that's all dependent on like, can he keep it together?
- [21:08]
A
Well, my colleague at PAC who writes for us about music, Dave Brooks, had done some reporting that Live Nation wants to see more out of him. They want to see some gesture of contrition, apologies some of the quote unquote doing the work. I don't know if Kanye or ye is Willing to do that or interested. But it seems like to get into business with a major promoter or brands, he's going to have to do something like that.
- [21:36]
C
Do you think that his apologies would be received as sincere?
- [21:40]
A
I don't, but I don't think a lot of these apologies are sincere. They just. People do what they feel they need to do, and every.
- [21:50]
D
There's.
- [21:50]
A
If there's enough money to be made, everyone will play along in the charade. If there is enough, if, if, if it's mutually beneficial.
- [21:59]
C
Right.
- [21:59]
A
And I think so.
- [22:00]
C
Why is now the time where, like, Louis CK can come back? I mean, I know he's been touring, but it feels like this is a little different. Right. Netflix is.
- [22:07]
A
Well, this has been a shift in the culture. Netflix has clearly taken a position that they are a platform that does not judge. And if there's offensive stuff to you, there may be stuff that you like that's offensive to someone else. You know, I don't know that Louis CK has done, quote, unquote, the work or apologize in any meaningful way, but maybe he has. Maybe there was some assurance behind the scenes, and it's comedy. Ted Sarandos has been pretty clear that he wants to be in business with top comedians, regardless of the controversy. Chappelle is a perfect example.
- [22:44]
C
Well, and Netflix, not that it was a, you know, a glowing portrait, per se, but Netflix did have the Yay documentary.
- [22:52]
A
Yeah, but that was unauthorized, right? Yes. I mean, they also, they, they did the, you know, the Diddy documentary and like a bunch of other things.
- [23:02]
C
Yeah, well, the Diddy one was the opposite of authorized.
- [23:05]
A
Exactly. So two years is ye back.
- [23:10]
C
He's so, so fucking hard to predict. Because you're asking me to. That is all dependent on his behavior. And he has been pretty unstable over the last decade.
- [23:20]
A
I don't think he will. I think there will be something.
- [23:22]
C
The part of me that grew up with his music and thinks he's unquestionably the most influential artist of, like, this century.
- [23:29]
A
I know you wrote that. I was like, Taylor Swift would like a word.
- [23:32]
C
No, Taylor Swift didn't influen how other people sound in the same way. She's from a business perspective, more influential, but from an artistic perspective. Ye influenced just a lot, a lot of people. But so I hope so, because I hope he's also better. And I hope that a lot of the horrible things he said were, in fact a result of mental illness. I would like to believe that people can change and be redeemed. But nothing that he's done in the last 10 years gives me a tremendous degree of confidence that he will be. I assume that, that something will come up. Right. Like the UK getting, getting not allowed into the UK came right after it seemed like he was on the precipice of, of good things happening.
- [24:08]
A
Yeah. He put those ads in the newspaper and was like trying to, to make all the gestures. Yeah, I, I don't think you can trust this guy. I think that you are. There's going to be something that will blow up.
- [24:18]
C
I think he will, he will go on an apology of tour of sorts, sort of like what you're outlining where he will find groups to meet with or he will say things publicly or he'll do something. But, but look, he has been noticeably absent from social media and the public discourse during all this happened. They've either he on his own or the people around him have kept him very focused and relatively disciplined. It just feels like it's inevitable that he will stray from that.
- [24:46]
A
I'm looking forward to all the great work that the crisis PR people are going to be doing over the next few years. Good for them. I hope he, I hope you bill him by the hour. All right, Lucas, thank you.
- [24:55]
C
Thanks, Matt.
- [24:58]
A
Today's call sheet is brought to you by AMC plus. Billy Magnuson and Zach Galifianakis star in the new series the Audacity on AMC and amc. Plus influence rises, people unravel and CEO meltdowns are business as usual among the Silicon Valley elite. Watch the Audacity Sundays only on AMC and AMC plus. Okay, we are here with the call sheet. Craig is here. I've asked Lucas to stay because I'm genuinely interested in Lucas's opinion on this petition that was issued. Not a petition, more of a letter to the community opposing the Warner Brothers Paramount merger. A thousand people in town have signed this, including some pretty big bold faced names. Noah Wy, the star of the biggest show on hbo, Max, the Pit. Damon Lindelof, big creator at Warner's Glenn Close.
- [25:51]
C
J.J. abrams, also a big filmmaker at Warner Brothers.
- [25:54]
D
Denis Villeneuve.
- [25:55]
A
Denis Villeneuve, who's got Dune coming out via Warner's Glenn Close. A bunch of actors are in this. So Lucas, does this matter?
- [26:05]
C
A little bit? Yeah.
- [26:07]
A
Okay.
- [26:08]
C
No, I think it matters because I
- [26:09]
A
actually agree with you. But, but tell me why, legally speaking,
- [26:12]
C
everyone feels like this deal is inevitable, Right? The Trump administration has demonstrated it doesn't really want to stand in the way of most deal deals. Leads to all this deal. Europe and some state attorneys general are making some noise. But that would Most likely lead to some minor concessions, not to the deal being blocked. You ask the average person who works in Hollywood and they don't want this deal to happen. And so their only real recourse is to organize a public campaign to try to create so much opposition and pressure that it makes what currently seems impossible possible. Is this going to be the thing to do? It don't know.
- [26:45]
D
Question. Even if it works, isn't Warner Brothers going to be sold to somebody?
- [26:49]
A
Well, that's the question. Is that that, you know, Cinema United and the theater groups and these talent, they say no. They say it can stand alone on its own. I mean, the history of the market suggests otherwise. But you know what?
- [27:01]
D
But you can't force the company not to sell.
- [27:03]
A
But there are other scenarios that might keep them both as going forward. Concerns where, know, private equity buys it or something like that. I mean, I, that not. I'm not saying that's any better, but
- [27:15]
C
somehow I don't think Mark Ruffalo is going to be pro private equity buying Warner Brothers either.
- [27:19]
A
I don't think so either, but. But that's the question you have to ask when you start getting into, okay, what do you prefer for this company? And if the streaming numbers can't replace the cable numbers, then something's got to give on Warner Brothers because this is a cable television company right now. It is not a streaming company. And you could make the argument that with a few years of bridge financing to keep it going, maybe the streaming business becomes big enough where Warner's could stand on, on its own. Currently doesn't look likely. But I think that the, the goal here is exactly what you said, to rustle up these Democratic politicians who maybe think they could fundraise off of this issue and should become louder and get more involved. So it's not just these attorneys general and people like Elizabeth Warren that are skeptical of the merger. If they can get some more mainstream Democrats involved, maybe there's a way to delay this so the Congress turns over in November. And then the Ellisons have some bigger problems. Remember, there's a ticking agreement on this. So the longer this deal takes to close, the more expensive it becomes for Paramount. And maybe if they can hold this up for a year, it gets so expensive that Larry Ellison says, you know what? Not worth it anymore.
- [28:42]
C
Oracle stock goes down another 10, 20%, doesn't want to do it attitude. I mean, there are a lot of ways for them to attack the deal, right? Concern about consolidation in Hollywood, concern about Allison's in politics, concern about Middle Eastern Money. None of it is sort of on its face illegal. But I think there is a feeling that, you know, the, the Netflix deal faced so much resistance and then the, it switched to Paramount and the resistance like kind of evaporated and it, I don't think it was because people were suddenly giddy about the prospect of this deal. I just think they put forth so much effort opposing the other one that, the Ellison one.
- [29:19]
A
I don't know if it disappeared. I mean, there's still the stuff about cnn.
- [29:22]
C
Sure.
- [29:23]
A
And if you, you know, in New York, a lot of the media people.
- [29:25]
C
But it's not as loud. We were in a moment with that Netflix deal where it was like every day was a fight over.
- [29:31]
D
Well, because I think there was a more public threat to theatrical with the Netflix deal. And the idea of a studio selling to a streamer to big tech sounded worse than Paramount and Warner Brothers murder.
- [29:40]
A
Even though the money behind Paramount is big Tech. I mean, that's the funny thing is that in five years they could both be a subsidiary of Oracle or TikTok or some other tech roll up. And in their defense, Paramount did put out a statement today saying this merger strengthens both consumer choice and competition. I don't know how that does. I don't know how eliminating one does.
- [30:04]
C
Their argument is going to be that creating a viable, this will create a more viable competitor to Netflix, that on their own, Paramount and Warner Brothers would continue to atrophy. But if they combine, they can stand up to them. And I don't know, that's been the
- [30:17]
A
narrative all along, but that is a long term narrative and it requires years of pain. That, I think is what people like Damon Lindelof and Mark Ruffalo are addressing now.
- [30:28]
D
So where does this end up? What, what happens with this open letter?
- [30:31]
A
I don't think ultimately it makes that much of a difference. This is sort of what you would expect Hollywood people to do. If I'm the Trump administration and I see that people like Mark Ruffalo and Damon Lindelof don't like something, it makes me like it more. So maybe this will light a fire under them. The only thing that this m this, the only way this matters is if Democratic politicians see this as a populist or money raising issue. And if they do, maybe they can delay this.
- [30:59]
C
And if you get the full, like the full industry to come out, if you have the unions, if you, if you have the agencies who would matter
- [31:07]
A
coming out against this, Ari Emanuel would matter.
- [31:09]
C
I don't think he's gonna do it. But he would matter because he's so tough.
- [31:12]
A
He's never gonna do that. He's like, I know.
- [31:13]
C
I'm just. You asked me who would matter.
- [31:15]
A
He's getting David Ellison to pick up, you know, to hire Pete Berg for the Call of Duty movie.
- [31:20]
D
You asked who would matter. You asked who would matter.
- [31:23]
A
He said, okay. It just. That would never happen because Ari is. Is very much Team Ellison.
- [31:29]
D
Is there any creative that would matter or does it need to be somebody on the business side?
- [31:33]
A
I mean, honestly, like Sylvester Stallone, Jon Voight, and some of these Hollywood ambassadors that actually have Trump's ear?
- [31:40]
C
I think if you had, like, if they wanted to really go for it. And I don't think they're going to. But like at, okay, big summer movies opening, like Steven Spielberg's on the carpet at his movie saying this is a bad idea. The stars of his movie are talking about it. Chris Nolan talks about, says it's a bad idea. Matt Damon says it's a bad idea.
- [31:59]
D
Tom Cruise, if Tom Cruise doesn't like it, it might work.
- [32:02]
A
But maybe. Well, listen, we're headed to Cinemacon today. Craig and I are going to the airport. So Tom Cruise is going to be there. We think Chris Nolan is definitely going to be there with a microphone at the stage. And none of these theater owners like this merger. So maybe playing to this crowd, some of these talents will say that they're opposed to the merger.
- [32:23]
C
Could be.
- [32:24]
A
All right, Lucas, thank you. Today's call sheet was brought to you by amc, executive produced by Jonathan Glatzer, a writer, producer of Succession and Better Call Saul. Don't miss the Audacity and absurd look at the outsized ego shaping our future. Watch the Audacity Sundays only on AMC and and AMC. Learn more@amcplus.com all right, that's the show for today. I want to thank my guest, Lucas Shaw, producer Craig Horbeck, our editor Matt Pevik, and I want to thank you. We will see you a couple more times from Las Vegas.
- [32:57]
F
Tires matter. They're the only part of your vehicle that touches the road. Tread confidently with new tires from Tire Rack. Whether you're looking for expert recommendations or know exactly what you want, Tire Rack makes it easy, fast. Free shipping, free road hazard protection, and convenient installation options. Go to tirerack.com to see Tire Test results, tire ratings and consumer reviews and be sure to check out all the special offers. Tirerack.com the way Tire buying should be.