Big Tech, Markets, Energy, and Streaming (Podcast)

really focus on technology. Some disappointments out there for sure, although Apple kind of maybe saved the day a little bit at the at the end here with some decent numbers. Let's kind of bring it all into perspective tied altogether, We're gonna round table at today with Cameron christ macro strategists with Bloomberg News, plus Punum Goyle, senior e commerce

analysts with Bloomberg Intelligence, covers all things retail. Cameron, let's start off with you here, just you know, stepping back from the Microsoft's, the Google's, the metas of the world. Do you still consider or should the market still consider big tech as a driver as a market leader for this global equity market. Well, I think you have to just given the waiting in various indices. I mean, if you look at the SNP or even m s c I Old Country World Index. I mean, who do you have?

It's it's the familiar names, uh, most of which are directly or tangentially technology related. I mean, technically Amazon is considered discretionary these days, but I think we all know

that they're valued as a as a technology stock. So I think, of course, um, when you're talking about anything but very ephemeral, short term moves, you you have to you have to consider the tech sector as as sort of the hegemonic driver almost, And when it comes to the tech sector, it's interesting you look at Apple, you look at Amazon to opposite reactions. They're basically Apple canceling

out Amazon's loss on a points basis. If you look at the SMP five hundred and potam, when you think about the Amazon earnings that we've gotten, the wipe out that we're seeing in the stock, what do you think is the bigger issue here? Was it the warning about the holiday period or is it what's happening in a w S. I think it's a WS more so. We we know that holiday will be weaker than it has been just because of inventories being high and inflation curving.

Consumers fund. But on the A W S front, that was a surprise. Um, really just at the big delta that we saw versus estimates largely as you know, they also said that they were exiting the quarter at a mid twenties run rate, which is pretty weak considering the thirty one percent that they've been tracking for the past four quarters. Cameron, I'd love to get your sense here. We're at about halfway through earnings here, any takeaways for

you here? I mean, I know the big question for a lot of investors is, as I listened to some of these conference calls, is kind of the forward guidance and how bad will a recessionary environment be for some of these businesses? What? What? What have you learned so far? Yeah, I mean the there's a couple of a couple of things to unpack. Uh, you know, there's the the actual earnings we've seen relative to expectation. I mean, they've beaten, but they always beat, right, I mean, under promise and

over deliver is sort of the business model of Wall Street. Um, the magnitude of surprise has been the more or less the slowest m on both the top and bottom line basis since the advent of COVID, so that probably tells us something. UH. I I do think that forward looking UH guidance is significant UM, and I take what was

take on board what we said about a WS. But the fact is is that Amazon guidance UH for the fourth quarter puts its overall year on your revenue growth UH the second lowest in the company's history UH less than five percent. If you take the midpoint of the guidance range UM, that's less than inflation UM. And that's pretty significant because we're these companies at the top of the pyramid have valuations that are consistent with secular growth.

And I think what Amazon and Meta in particular are saying is that these companies are actually significantly exposed to cyclical vulnerability. And the question we have to ask is should these companies have a secular valuation premium if they're turning into more secularly cyclically vulnerable companies. I think that you can make a good argument that that no, there there's some of this premium that has been given to these firms over the last ten years maybe should should

be withdrawn. Well, there's some key differences between Meta and Amazon, one of them being that Meta is just funneling billions of dollars into the metaverse. I am so excited to see how that turns out. Amazon, on the other hand, PUNA is really looking at cutting costs here. What magnitude are we talking about and where? Sure, the costs are largely going to be cut on the retail side, um really when you look at technology as well as investments

in fulfillment, logistics, transputation. So we heard from them that they were expected to cut a billion and the one point five billion dollars from two Q to three Q. They only cut one billion, largely because they couldn't cut the costs and their productivity due to fulfilling demand for the additional prime day sales and early acts of sales that they had in three Q and four Q. UM. It's going to be hard for them to cut costs.

It will not come easy. They're going to have to look at some of their strategic initiatives as well as some of those experimental initiatives that they have to really um expand those margins. But at the end of the day, the margins are driven by a w S seven more than seventy of the margins on an manual basis, or the profits, I should say come from it up us and in the latest quarter three Q over a hundred percent. So we need to see those a w S margins

extand again, and we think they will. It'll just be a matter of time. The next few quarters are challenging, but a WS does have potential to expand again, both from revenue and a margin standpoint. All right, put him great stuff as always, put him boil. She's a senior retail analysts Bloomberg Intelligence covering all the e commerce uh stuff as well. She's been there since the beginning of

that evolution in retail. Plus Camraon Christ macro strategists with Bloomberg News, giving us kind of just a holistic view of here of what we've seen from these tech earnings. UM, some disappointments kind of across the board, maybe the exception of Apple, but according to Camera, no reason to think that they will no longer be market leaders, just given their propensity and their big size in the indexes. Said Oakley. He's a founder managing partner to Oxbell Advisors. We've talked

to him for a long time. He's down in Austin, Texas, US UM, but we've got them in our studio today for the first time ever. How cool is that? Ted? Thanks so much for joining us here. Um, you know, I don't know. We've we're coming through earnings here. I got a market that's down, my fixed income portfolios down double digits. What do I do from here? Is this the bottom? Can I start just loading in some stocks and bonds here? Well, I would say, Well, I would

not do that. I think, Uh, I think what what the Fed has given you is a little by time with the one in one year and maybe eighteen month treasury at four and a half percent, now you can afford to hold it, you know. And somebody tells me, now, hey, I can get a five percent dividend on something. I said, wait a minute, how about four and a half on a treasury? We have no risk on it? And so I think that's what's going on. But I wouldn't step into that. We really feel like this has probably two

or three quarters to go, maybe a little longer. Well, explain that timeline. What's going to happen in these two to three quarters. Are you waiting for the Federals or to take their foot off the gas a little bit? Well, Katie, they could, but I think people if they look at history, it always goes to show the market keeps on going down. But here's why. For us, we think that earnings, if you look at deceleration, they're up, but it's been really

decelerating now for four quarters in a row. We think that's going to continue into negative territory over the next three quarters. And as that happens, I think people have to readjust the level of what they're willing to pay for stocks. You know they talk about multiples, Well, the multiple is going gonna go up because your earnings are gonna need to go down, and I think they forget to factor that in here. All right, Ted, you're from Texas.

Texas Tech was your underground. I'm just gonna profile you, Ted and assume that you have a call on oil, on energy, I got w TR crew to oil about eighty eight dollars a barrel. Here. What's your calling oil? And what's what are your I know you're good friends when you're sitting around chatting down in Texas, you're talking oil. What's the call there? Well, you know oil companies can make money at eight and they can make money at eight, so you know, we own uh energy one production companies

on pipelines that sort of thing too. But what's happening is, you know, the large companies really have cut so far back on capex so that it's changed the industry industry, and it has helped the independence quite a bit. I think to do more. But for us, if you just look out over the next two years, we think it moves higher over time. Um, you know, we're we're getting to a point where it's supply to man is is

fairly equal. So uh and I understand it. And by the way, I'm all for taking care of that, you know, the environment of green I really am. I just think the timeline is all a bit so that's that's where I think. So I think it it does go higher. The only thing would would thwart it in the short run, which we think could happen, by the way, is if your economy is slow enough all over the world, there will be a short period in there three to six months where oil can can foll back. Something we'll see.

And if we think about the energy sector for so long it was winning by so much. When you translate that oil call into the stock market, has the energy trade run its course? You know, Kedy probably has to a degree. I think you're you're onto something there. I think a lot of people really focused on it, and they were too they had too much oil and their portfolios,

particularly on the professional side. And what's happening if you look at the companies, they've sort of been trading those highs now for you know, they had a high, they fell off, came back, but they haven't made significant new highs here. And so I think you, I think you you could be very right on that. It ted You've You've had a heck of a career here founding Oxbow Advisors. Uh,

you've written nine books. You're also the chairman emeritus and founder of Foster Angels of South Texas, the largest foster child foundation in South Texas. Talk to us about that, how's it, how's the environment down there as it relates to foster care and things like that, because there's always so much discussion. We hear in York, we hear about

the border and all those types of things. What's it really like feeds boots on the ground in South Texas well, we have to the two foundations are both the same side. There two separate foundations, but we also did Foster Angels of Central Texas, which is out of Austin. So between the two we cover about sixty five counties in Texas. And but you know, having done that, have really helped

foster children for twenty five years. Our problem is is that since their wards of the state, foster children are unfortunately out of sight and so you you can't get people to understand really apply to a foster child and what we do at Foster Angeles and we try to give them things very quickly within forty eight hours that will help their staff to esteem if they want something. But the problem in the state, to answer your question, is we have a lot of people who don't understand

the system. They don't pay the people in the system, the CPS any money they have about at turnover rate if you can imagine, and so uh, everything compounds on itself, and so you have the problem with foster families. We don't have near enough and part of the ones we do have are actually not that good. Who have a lot of great ones, don't get me wrong, but a lot of them just do it for the money. And then you have a lot of CPS workers that it's a tough job and that's just a turnover. We have

those two things going on. Then they've had a lawsuit from UM that I don't agree with it necessarily, but what's happened is it's really put a lot of pressure on the system because they am to respond to lawsuit instead of helping instead of helping children. So it sounds like a lot of red tape like we have here and you have in Texas and every state. And I am very familiar with the New York's floor is all the big state, right California. We all have the same problem.

You have the same problem here too. All right, well, we appreciate you doing all anything you can do to help there. That that's great stuff. Ted Oakley, Founder and managing partner Oxbow Advisers. I want to get to rate the our next guest because she is in studio. So that's two guests in a row in studio. These are folks that we've talked to before, but we have them in the studio. Solday, it's a Friday. There's no Bloomberg employees here today, but other folks are coming in. Allison.

Right now, our CEO of Seventh Generation joins us in our Bloomberg Interactive Broker studio. Allison, thanks so much for joining us. Tell us just give us the overview what seventh generation is? What are you guys up to? Yeah, first, thank you so much for having me. It's great to see you all. Yeah, and a little bit about seven generations. So we are a household cleaning company that focuses on our mission of transforming the world into a healthy, sustainable,

and equitable place for the next seven generations. So yeah, like, no small goals for us. So I give us a sense of kind of like some of your products, who you do business with, how you get your products at here in the marketplace. Yeah, great, So I think you will likely see us walking down any grocery store aisle, Target aisle on Amazon dot Com, Walmart aisle in the categories of laundry, detergent, household cleaners, and dish products and so. Um.

We really have distribution in you know, most everyday stores. Um, and so we're we're really part of everyone's households. This is Bloomberg Radio. So I have to ask you about the supply chain it's always been talking about for two years. Tell us how the past two years have been for you in terms of managing that. Oh, my goodness, it's been a wild ride. So UM we are we do

operate in the categories of cleaning and paper products. So you know, over the course of we saw record growth behind those products and record inability to meet the demand

of both our retailers and our consumers. And so that was a pretty wild ride for us to just really make sure that we could deliver on what consumers and retailers were asking us for UM And then on the other side of it, I think it has been a combination of both figuring out how consumers are going to be cleaning UM in today's world, and then also making sure that we have a supply chain that is future fit for this type of volatility, because I will tell

you that even today, while the demand is not as high as it was, I think we're still working on back tracking a lot of the supply chain decisions and retrofitting our supply chain to make sure that we can can meet the day to day demands. So how did your business and how did demand for your products kind of evolved during the pandemic, Because it seemed like for a while there we were cleaning everything, including the groceries we brought home from the supermarket and then leave them outside.

God what we didn't know. Amazing, But anyway, here we are. How did that impact your business? Yeah? Sure, so I think, like like our our peers in the category, I think we just saw unprecedented demand for anything that cleans, and so we do operate in the disinfecting cleaning category, So we do create a line of products that are UM that killed of germs, and so we really saw that range of products UM flying off the shelves as soon

as literally as soon as they were set UM. So you know, it was really it was really challenging for us to track how high is high and bring us to now and bring us into the future. You know, you mentioned how people clean have has changed. How are you adapting to that and what trends have you noticed? Yeah, so there's there's kind of two big things that are

emerging in our business right now. So one, I think UM consumers first of all, are still sitting on quite a bit of product that they bought, and so I think, UM, we're still working through the tail end of product on hand. UM. They're also thinking about cleaning differently. I think the role of efficacy in what is clean has become much more prevalent. Given our conversations around germs and safety even past COVID, Right, So, I think there's a lot of things happening in the

news now from a health perspective. Um this on top of the fact that we are a sustainable business, right, so we really focus on the environmental aspect of the products that we make. And the challenging thing right now is that there's some very real concerns for the U. S consumer between financial insecurity, UM inflation, or health and safety. And so we are seeing the environment slip a little bit from what's the top of mind for consumers in

their day to day and so we've really had to pivot, right. So, I think one of the things that we're working on as a team is how do we make sure our communication is super sharp from an efficacy perspective, so we work as well as our conventional counterparts, So how do we make that point really clear? And then also how do we dial up the urgency around the environmental concerns like the earth is burning, we must do something about it, and so how can we just make sure that stays

top of mind. You mentioned inflation. Uh, it seems like we just we're getting through a big earning cycle here we're hearing from a lot of companies report earnings in their inflation is right there. How has it impacted your business? Yeah, so, I think we certainly have not been immune to a lot of the challenges that most companies are facing in terms of rising costs for materials, and so we, like

the categories, have had to adjust our pricing. But the one thing that I'm super proud to talk about is the fact that you know where we make our biggest investment is in our product So we use a hunt as much as plant based materials as we can, up to a hundred percent, and most of our products we also focus on using as much better plastic as we can, so we use a hundred percent post consumer recycled plastic in our packaging. UM and so those are expensive right there,

are expensive before the pandemic. Right. It's the quality that we're investment that we're making, and so the thing that we've had to really work for is how do we make sure that we maintain committed to that quality of ingredient, to that equality of environmental standard and make adjustments around that. UM. So I think we really focus as a team to say we have to keep the quality of the product intact during this time, to what degree have you passed

on those higher costs? How much have you raised prices? Yeah, so it really does vary by category, right, So I think, um, it depends on the sub segment that you're looking at. But I think we do our absolute best to minimize the amount that we pass on. But at the end of the day, I need to make sure that this financial model continues to make a sense. So UM as a company, we have certainly made it our priority to ensure that sustainable products maintain as much accessibility from a

price point as possible. So one of our biggest priorities is dispelling the myth that natural products have to be more expensive. Um. So, as a business, we always work to make sure that we keep our pricing as accessible as we can. But I think that you know that's really been tested during these times. Are you based? We are, and every company that we talked to for the last boy two and a half years site labor as a challenge. What's it like in Burlington, Vermont and the other places

maybe where you operate? Yeah, great, so I think, um, you know, actually, one of the biggest changes that we've made from a working perspective UM as well. Our headquarters is based in Burlington, Vermont. We're really opening up a wide net of remote working for our company. So we're casting a wide net to make sure that we get you know, the most amazing talent into our company, no longer letting our headquarter location dictate that. And so it's actually been a great way for us to really rethink

talent strategy. We've got I've got a hundred um. But remember we are owned by Unilever, so I think there's a much larger ecosystem that supports us. So UM, I like to think that there's millions of people out there working for us. Alison, thank you so much for joining us. Allison written now our CEO of seventh Generation joining us live in our Bloomberg Interactive Broker studio, which we appreciate making a trip down from Burlington and Yorth, home of

the University of Vermont cat amounts. How about that? My knowledge is my knowledge is just all over the past, worthless trivia. I've got it. It's a big oil companies reporting um some numbers, and boy, when those guys make money, they make a lot. Yeah. So I mean, you know, when we talk big energy. When we talk big oil. We talked to Fernando Valet. He's a senior oil and gas analyst at Bloomberg intellig just another guest of ours in the Bloomberg Interactive Broker Studio. I don't know what's

going on to it. I think we're being punked. Are we giving something out at the door or something to get we haven't gotten waiting for. Fernando's talked to us about Chevron, talked us about Exxon. I mean, I gotta assume at eighty eight bucks a barrel, they're making some money here. Yeah, and they actually made some money because

there's a catch up. Usually contracts for lerg loqual Financial Gas lag anywhere between three or six months, so they're really getting into that peak of the oil price from the second quarter on the l n G side, and that's probably going to last until the fourth quarter. And this is a reminder, cutter gas. It's Excellent's best asset by far at points it contributes as much income, so they're very exposed to that, and it explains the record

profits in third the third quarter. Okay, so the superlatives here are pretty amazing. Excen highest profit and it's a hundred and fifty two year history. Yeah, I'm reading a Bloomberg News story right in front of me. Chevron almost almost second past quarterly result. Ever, I'm gonna be pessimistic. When when does the boom time's ends? This can't last forever, Well, it can't, but it can get worse actually before it gets better. I think in the short term, you're correct.

There might be some weakness we saw obviously towards the end of the third quarter and start now the fourth quarter, weakness in oil prices. But then refining margins have taken off again, especially led by diesel. We have an article out talking about how diesel shortages are going to be crippling to the East coast and UH and that will benefit a lot of the refiners UM and and their margins are going to continue to creep higher in the

fourth quarter, and we're thinking to the first quarter. But even if we go to a little bit lower and we are about down from the highs and the second quarter for Brent UH, we still think they generate a significant excess cash flow. And the cash balance for Excell now's the thirty billion dollars, and we think even if it's a little bit lower, they still have to find a home for those uh dollars because their net debt is almost to net cash. So I mean, I'm just

looking at Chevron Chevron US equity. Then I go f a function financial analysis. I mean, twelve billion of cash, twenty six billion of debt. You know, the next couple of years, thirty five billion in free cash flow each year. Why aren't these guys doing two things? Drilling more holes in the ground for more supply, building more refineries so we don't have those diesel shortages in the Northeast. Not that I drive a diesel vehicle, that's Matt Miller's game.

But are they investing back into their businesses? Well, but you do eat food that takes that diesel, and you buy from Amazon, who uses that diesel as well, so it's important for you as well. Uh, They're well, refineries are just impossible to build in the US in the current environmental climate and regulatory climate. Payback is very long and you need to have some assurances that you're actually going to be able to continue producing for fifteen to

thirty years, and we're just not there today. Uh So we don't expect those to be built. Um in the Middle Eastern Asia really where we're seeing a confinery capacity on the on the upstream side, we agree, and we think will mark yet another increase in spending from these guys. Uh, we haven't seen a lot of exploration. We think exploration will come back strong from three on deep water. Exxon made more discoveries out in Guiana, which is a burgeoning

oil province there for them. Have you ever been down on an oil rigging? Uh? Yeah, I've been to a couple in Brazil back in because you're out in the middle of nowhere on this rig offshore. And I've been in the I've been in the middle of the Amazon as well, on an onshore rig in the middle of the Amazon. Rang. I don't think I would love that. Maybe in the Amazon, I don't. I would climbing the stairs on the side of a boat in the water. It's pretty interesting. You have to climb with your hands.

It's oh my god. I would probably panic. Is peak oil? Is that still a thing? I don't. We should talk about it two or three or four years ago. I think we need more oil, don't we. Well, that's our belief, and you know, contrary to a contrary to the international energy agencies forecast or we think we're still going to to to higher levels over the next several years. If you look at emerging markets, there are the main drivers of oil demand growth. Uh, and we haven't really found

a solution for or. They're grit issues for their consumption and in order for them to improve their quality of life, they need to consume more energy and right now that has to be fossil fuels. There are the alternatives. Aren't enough to sustain an improvement in life for five billion people? Can let me ask you a question. Can the world exist without Russian energy? Yes? But not without Russian energy

and without seeing growth from other regions. We have a lot of resources in Canada, we have a lot of resources in Venezuela. We have a lot of resources in the US, but they need to be developed. Can the world exists this winter without Russian energy? Yes, but cartailing a lot of industrial activities, So you're going to have to prioritize safety over the economy. And I think that's

what Europe has already done. That's how we got tomentary fill was by cartailing economic activity OPEC plus How powerful is it today relative to maybe the past? I think especially Saudi and the u A are extremely power powerful and they know uh, they know that, uh, and their comments around Saudi first are really uh indicative of that. Um. We have given them some of that power by moving

offshoring energy production and energy security. So I think it bhoos us to take some of that back and and really look at North America as a source of clean energy because it can be the cardboard, uh, the carboards, the carbonized and improved, and we have some of the more strict environmental rules compared to other energy producers out in there. All right, good stuff, as always went back. I could talk energy all day. It's just like it's

a global issue. It's a geopolitical issue. It's just our good friends down to Texas and Oklahoma issue lots of stuff there. So Fernando Valet he does that for us. Uh. He gets paid to do that for us, believe it or not, climbing up on ships and going out the oil rigs in the middle of the ocean. I mean, who knows, but he does that for Bloomberg Intelligence and we appreciate it. Again. W t I crude oil it's off a little bit today, a one point three, just

under eighty eight dollars in barrel it. This is a treat for me, folks. Felix Dolett is in our studio and Katie another in studio. Guests, something's in the water today. I don't know everybody's coming into the student they want to be in our presence. I guess it might be the last lunch here at Bloomberg ever. So Felix do that editor for Bloomberg News. Um. He's also the editor of the Bloomberg Entertainment vertical screen Time. You can find

that on Bloomberg dot com. But he's got a big take story and we love the big take stories, and this one's really right down my alley. So I turned to it right away on the train coming in, talking about HBO and Netflix, and it's really goes to the HBO story. Because Felix has got a new book out.

It's coming out in just days. It's called It's Not TV The Spectacular Rise, Revolution and Future of HBO, which I cannot read, wait to read because I was there kind of ground zero during all that stuff at time Warner really cool stuff. So I Feelix, thanks so much for coming in our studio here talk to us about kind of what you found in your deep reporting of the history of HBO. Yeah, I mean it's fifty years. Incredible impact that HBO has had on uh TV, revolutionized comedy,

drama documentaries. Um and uh this is this piece for the big take was you know, the first extra from the book. Uh. You know, HBO is the protagonist of our book, but we really kind of developed Netflix as the antagonist because I think there's such fascinating parallels and contrast between these two companies. Um and you know we

really dug into that also. UM and this is this exert focus is really on two thousand ten, two thousand and eleven, during the time when they went from being you know, copasetic business partners in the era too suddenly during the switch to streaming, all of a sudden, realizing we're going to be huge intense rivals. Who would you say is winning To ask a very simple question, I think Netflix has a huge head start, especially if you

look overseas. I mean, one interesting thing about HBO is for all the incredible branding that they've done with HBO over the years, where everything was about the HBO brand, premium cable. You know, you're paying Actra for this. Um all the shows feeding into that. Uh, you know, overseas they did kind of the opposite, so um, you know, overseas it was all about profit margins and licensing their

shows to other networks. So the HBO brand does not actually have a huge amount of resonance outside the United States. And now as the global you know, the streaming wars are going global, I think that's where you see Netflix having this incredible advantage. You know, I think about the early days of HBO, and it was just so revolutionary with Jeff Bucas did there because big budgets. Okay for theatrical film, I get it, and you get a certain quality of that. You don't get that on TV. He

didn't get that on cable. But all of a sudden, they put serious money behind some of these um series and I just watch for the first time after twenty years, The Wire, and that was really the series that changed the entire ballgame what could be on the small screen. Yeah, I mean they made a big switch in the mid nineties where you know, the early HBO series were very

cheap looking. You know, if you go back and look at Tanner eighty eight or even Larry Sanders, which is an incredible show, but they didn't put a lot of money on the screen. Then it was you know, From the Earth to the Moon, which was a mini series Tom Hanks and Brian Grazer were doing. They said, you know, if you're going to do this mini series on HBO, it has to have real special effects. You guys cannot

cheap out. And so yeah, Jeff Buchaus at the time as CEO, said, you know what, we are going to put a huge amount of money in here. We're gonna move to a more theatrical model where we'll spend a lot of money up front and then we'll figure out ways to try and monetize on the back end. And as it happened, that was also the period of time where direct TV was coming in to play. They were getting an extra money from direct TV, and also DVDs

were also hitting. And it turns out that those series that they created in the late nineties and early two thousands, Sex in the City, The Sopranos, six Ft Under the Wire, incredible series, an incredible run they had, and not only that, pulling a lot of subscribers, they could also take those shows and they remember those box that's they used to make a DVD box that those things were like pure gold, you know, by like one season the Sopranos was like

a hundred dollars or something. It was absurd, but it was a great extra revenue stream that they could just continue to plow into making their shows look, you know, more like theatrical productions than anything else on TV. I gotta say, I haven't seen The Wire yet. I need to you do again. I just it was a twenty year anniversary and I said, boy, I've always said to myself, I need to watch that. So I started. You can now stream and binge it all the stuff that d

to do, and it was awesome. Yeah, yeah, I have seen the Sopranos, I will say that. But Felix, so the big take today. It's an excerpt from your book, which is coming out next week, I believe remember on November one, sorry, right after Halloween. So the I was going to say, headline the title of your book, it's not TV. It's a Spectacular Rise, Revolution and Future of HBO. Let's talk about the future. Does it look like it

looks pretty good right now? I think that, Um, you know, three years ago when we started the book and A T and T was taking Warner Media very slow, very classic magazine writer. You gotta yeah, it looked, you know, people were saying, oh, is this is this going to be the end of HBO. What's going to happen? Um. HBO has had an incredible strong two thousand one, two thousand,

twenty two. You think about you know, the White Lotus succession, Mayor of Easton um and just this year with the Game of Throne sequel House of the Dragon, which has probably been the biggest thing in TV uple months. They're doing great. You know, Discovery has come in a T and T spun spun off Warner Media. They have new owners with Discovery. I think David Zaslav is a big

supporter of the brand. UM. So, actually HBO is doing great and the method that they kind of perfected back in the eighties, you know, late eighties, nineties, two thousands, still very powerful, still a great way of doing television. But there's a lot of competition. Like I used to think, you know that the story was in Hollywood. If you really want to do something really high quality, you go to HBO. Now I've got Ted Surrandos and Netflix writing huge checks. I've got lots of other I got Amazon,

appleple So how do they adapt? I guess they've had to adjust because you're right, in the old days, they could outspend everybody if they wanted a project. They just you know, we have this thing in the book called the HBO shrug, which was like, you know, we were gonna pay eighty million dollars for Banded Brothers, Well, we'll spend a hundred million. That's fine, And they didn't have to worry about it, and that was a huge advantage.

I think they've adjusted in recent years because really, when Netflix came along and odd into programming in a big way over the past decade, they kind of stole that position in the marketplace from HBO because you know, the paradigm of tech investing, it's been all about growth, hasn't been about profits, and that positioned Netflix to really do the same thing to HBO that HBO used to do to everybody else, which was, like, you know, in the Expert in the Big Tape, we talk about Netflix swooping

in and buying House of Cards, which was like their first big bed on the original program, and they offered a hundred million dollars two seasons without seeing a pilot it's crazy stuff, it's fun stuff. This is gonna be a great book. Felix, do you let editor Bloomberg News. He's got a new book coming out next week, which I'm gonna buy. I'm not gonna take one of the ones they have around here. It's entitled It's Not TV The Spectacular Rise Revolution in Future of HBO. Thanks for

listening to the Bloomberg Markets podcast. You can subscribe and listen to interviews with Apple Podcasts or whatever podcast platform you prefer. I'm Matt Miller. I'm on Twitter at Matt Miller seventy three, and I'm fall Sweeney. I'm on Twitter at pt Sweeney. Before the podcast, you can always catch us worldwide at Bloomberg Radio