Welcome, Welcome, Welcome back to the Bob left Sets Podcast. My guest today is business expert extraordinaire, the one and only Seth Godin. Seth, good to have you on the podcast.
It's a treat I never thought it would happen, and I never asked. And I've just been sitting here thinking Lefsets, who has so generously chronicled the oral histories of so many people who changed my life, my childhood, my young adulthood. What I have impostered syndrome. I'm not sure why I am here.
I'm not sure how to respond to that, So I'm gonna jump right into the questioning. Okay, we just had a presidential election. What did we learn about marketing in this election? Let me just sort of set the landscape. Traditionally it was a ground game, it was network TV. There's a campaign where we saw the power of podcast. What's your insight in terms of the selling of the candidates.
I think most people don't understand what marketing is. It's not advertising or hype or hustle. It's not a logo. It's this ephemeral, ephemeral story that doesn't easily have words on it that we consume, and then we attach a narrative to it. So I don't chime in about the horse race of politics because it's a distraction and.
It's designed to divide us.
But I think we can learn a lot about which stories resonate and why they resonate. And lots of people in the music business understand intuitively that they're storytellers, but they can't find words for it and figure out how to put the words on it so that we can tell a better story. Time to get back to what people really want, which is affiliation, status, belonging, freedom from fear,
and believing that they were right all along. When those things kick in, the story sticks and the words are secondary.
Okay, how important is the marketing relative to the quality of the product itself.
The marketing is the product itself, So let's dissect that. Quality has nothing to do with luxury or goodness or whether you like it or not. Quality is whether it meets speck. And so art has problems with quality because there is no speck for a perfect Joni Mitchell song. There is no speck for how do we create this resonant story, because the second time we do it is not art anymore. The second time we do it, we're
just a little bit more in tune. But back to your original point, marketing that story that resonates with people, we will make up all sorts of facts about its quality to justify the fact that the story resonated with us. So simple example, Saint poly Girl beer Beck's Light, Which one do you like better?
Bob Well, I no longer drink, but when I did drink, I liked Becks better.
But okay, it's exactly the same beer, made on exactly the same assembly line, put into slightly different bottles. And that's because the story of Saint Pauly Girls fraternity brothers and the story of Beck's Light is yuppies, and they told different stories, and people would argue about this, just like in a double blind study you can't tell the difference blindfolded between a Ford and a Chevy truck. But they're Ford people and they're Chevy people. Because the story
is about identity. There is identity in being a Stones fan instead a Beatles fan, and vice versa. And it's this need that we have to live a life before we die, to be part of something, to not be alone. That's identity. And then identity can express itself through music, and if you hear the song over and over and over and over and over again, growing up becomes part of your identity. It's not because it's quality, it's because of who you are.
Okay, just to stay on that same theme, something has longevity, because.
So what did I buy when I bought a one hit wonder top forty song that I was totally into for a week? What I bought was it was going to be replaced next week by a new one. That's what teeny boppers do. What did I buy when I became a Bruce Springsteen fan for life and pay six hundred bucks to go see him? I bought the tribe. I bought the circle of people that I identified with. They're different products, and there have been people in the music industry have been churning out the first one forever
and the second one we sort of back into. But every once in a while a musician works hard to build that arc to say, you know, I'm not sure when the Warlocks decided that The Grateful Dead was going to become a lifestyle, but it's pretty clear after a couple of records that that's what they were committing to, that they were making music for the family, not eagerly trying to find new listeners.
Okay, if you started in the late sixties and the sixties when the Warlocks turned to the Grateful Dead, everything happened much more slowly. We hit the MTV era, where, you know, in aligned with their logo of the rocket ship, you could literally go from zero to hero overnight. But it's well established that the faster you went up, the faster you came down. So what can we say about that ascension?
That's interesting. I was listening to your Dire Straits podcasts a couple of weeks ago, and I'm not sure that the evidence backs that up. I think that one of the breakthroughs that happened for Dire Straits was MTV, and yet today they're still part of the fabric of a whole generation of people. One of the things that happens when you get programmed because you buy your way or luck your way into the top forty is by its nature,
most of the top forty is disposable. But then that's part of the reason Billboard had to invent a new chart. Because those other people who were selling and selling and selling and selling and selling, they were important in the music industry, but they weren't the hit of the day. I don't know if that makes any sense.
You know way more about this thing.
No it does. I mean the case is the dire straits. I don't want to get into the weeds, and that most of their success was prior to the MTV era, and then they blew up in the MTV era. I don't want to, you know, split hairs here. But the question is can I'll put it a different way. A member of another band they said, we're afraid of having a hit. This is in the modern era, it will destroy our career. Yep, we're as it is so hard
to be recognized at all. And he was taking advice from older acts who'd already had hits.
Yeah.
So you know, when you have this level of success, you can't really plan it a lot of times anyway. But I think today, to have some level of ubiquity can only be a good thing.
No, no, it cannot only be a good thing. The system wants to chew you up and spit you out. I think it's worth asking the musician, what's this for? This journey you're on? Why are you here? What are you doing it for? If you're doing it to make as much money as possible. You didn't pick a great industry to do that. Because someone's going to win the lottery, it's probably not going to be you. If you did it to have this craft, you know. I'm a huge
fan of Patricia Barber. I was lucky enough to sort of produce at an executive level one of her records.
But I've known her for a while.
Patricia Barber plays beautiful jazz piano, and first it was at the Green Mill. Now it's at a different club in Chicago. They basically turned the clobe over to her once a week. The rest of the time, if she wants to, she can sell out a pretty big jazz club in New York if she wants to go on
the road. But once a week she shows up. That's her living room and I'm talking to her and I said, you've got that one song that gets everyone out of their seats, that sits in the in the beautiful overlap between jazz and pop. But most of the songs you're playing are calmer than that, more melodic than that. Need more insight than that.
What are you doing?
What's the goal here? And she said, my goal isn't to sell records, right. My goal isn't to be famous. My goal is to create the conditions for this music, for this music to reach people. And if there's only two hundred people in the room and she can do it again next week, that's fine. So the trick that social media and media before that has pushed on creators is this, you know, it doesn't matter what you say as long as you're famous and they spell your name right.
I think that's ridiculous. I think that makes the executives at the record label happy, but I don't think that's how you build the career you want to have.
So what comes first? You're in your bedroom, there's a belief in yourself or is it the ta years of music lessons? Or is it the people? You know? What's the germination of this career?
So Dave Grohl wrote a book in which he argued that it's what your mother did when you were eleven, and he interviewed all these rock and roll moms, and you know, we're all living in a high school for the rest of our lives. High school does something to us. And for pop music, it's from the stories I'm hearing. It's often what happened in high school? How did that help you find an identity? And then by hook er
by crook, who did you become? And so if we think about someone like David Bowie, or we think about other musicians who we think we know what they sound like, and then you listen to their early music, they didn't sound like that, right that.
What happened was.
They became whatever they needed to become to do their music for the people they wanted to do their music for. And that experimentation and exploration is driven by an unsatiable desire, an empty hole that a certain kind of musician is trying to fill. Sometimes they get fortunate and it happens right when they needed to happen. Sometimes it happened sooner than they needed to happen. I think Ricky Lee Jones,
it happened sooner than she was ready for it. But when you watch what Ricky Lee Jones has done since she blew up with a couple of records, is she doesn't care how big the venue is. She wants to play her music her way for the people she's playing it for, to share the noise in her head with other people. So I'm mixing together a bunch of ideas about creativity here. But I don't think these people.
Were talking about are born that way? Really confident that they are made, not born.
Okay, you're not born that way. What is the biggest influence the mailstream of high school or your parents or luck of the draw?
Yeah, it's all three, It's all three. What radio station was playing every night when you went to sleep? You know, you think that you were born to sing and perform a certain way? Well, what a coincidence. No one's doing that with this sitar because they weren't born in Bangalore, right, And so the noise in your head combined with the encouragement or discouragement you get, combined with your identity, combined with did you get a call when you were at
Risdy to join Tina and David? Or didn't you because if you didn't, we've never heard you play.
The bass or the or the drums.
Okay, breaking it down on a granular level, success, what percentage is luck?
Well again, I keep playing with words with you, Bob. I'm sorry, I'm not sure what you mean by success, and I'm not sure what you mean.
Oh okay, okay, let's use conventional wisdom, which is not internal success, but the measurable success of the external world. It can be dollars, it can be chart positions, et cetera. We live in a world where you have these billionaires write books saying how I did it, but people don't understand is that's how they did it. You can't replicate those steps. If you know those people, they are unique individuals. Okay, Then there are people who say, I'm sick of hearing
the rich people tell me how they did it. They were just lucky. Whatever. Let let's let's go to Bill Gates. Bill Gates was approached by IBM. They said they need an operate system for their new computer system.
He didn't say I don't have that. He said, well, hold on a second, I could do that for you. I mean when bought some other operating system and sold them. So the question is, no matter what he did, would Bill Gates have been successful?
Okay? Or you know, are there people who are really good but they just don't hit the right situation.
I have no doubt in my mind that every billionaire that I've ever met is lucky. And Bill Gates was lucky long before he got that call from IBM that the books in which someone tells you here's how I did it, are a selective recall of some lucky moments
interspersed with a small amount of grit and determination. It is very clear that lots and lots and lots of people are born with enough privileged to show up in Silicon Valley and then fail, or that something goes well and then they double down on it and they fail. But sometimes they double down on it and it goes well. So the mythology that this sort of external success is completely earned is just mythology.
And you know so a.
Simple example, Yahoo was built on the Stanford computer system, and as it grew, two students at Stanford were making the thing work. Stanford calls them up and says, look, you guys are using way too much bandwidth. We're kicking you off. And they know my friend Lisa, and my friend Lisa knows the people at Netscape. Now, the people at Netscape at the time, we're getting more trafficked to their website than almost any other website.
This is nineteen ninety five or six or something.
And if you went to Netscape, the homepage for the browser, so when you turned on the best browser on the internet, it took you to Netscape's homepage. There was a search box, and they had a problem, which is people were typing stuff into the search box and sometimes they would overload whichever search engine you went to. So Netscape said, sure, we'll put Yahoo on our servers so that way it won't crash when we send people to them. If that
hadn't happened, you never would have heard of Yahoo. That had nothing to do with David or Jerry. That had to do with proximity, the luck of the draw, the network effect, the multiplication of small advantages getting to be bigger advantages. And the same thing's true for Howard Schultz. He takes over a coffee shop that has two outlets
that doesn't sell coffee. Well, Howard had a really insightful idea about what Starbucks could become, but it could just as easily have been Pietz or somebody else that ended upping the United States. I think we can set ourselves up to increase the chances we get lucky, or to multiply it once we do get lucky. But I don't think people should bet their life on getting lucky.
Let me give a personal example. When I was living as a ski bum in Utah. I was living with these guys. They would meet people out on the hill and they would invite them to stay with us. Okay, and this I would never do anything like that. I guess my upbringer, who are these people? Where are they coming from? Taking to my house? Whatever? So is that mindset ultimately working against my having lucky situations? Or is it about finding your own situation where your personality works.
Okay, So now we're talking about strategy, and I love talking about strategy. That's what my new books about. Strategy is a philosophy of becoming. It's about seeing the system them. So the strategy of the first person who funded my internet company was if anybody had a pulse and an internet company, he would write them a check for one hundred thousand dollars because he had enough money to do that eighty times, and he just believed that this thing
was going to go in a certain direction. If you think about the strategy that someone like Barry Gordy brought to building his record label, it wasn't are you a guaranteed hit? It's do I think that this small amount of money is going to take to record a track from you is going to get me to the next level, just be promiscuous about it. So perhaps these guys had a strategy that said, more surface area, more exposure to the kind of people who come here, will make our
lives more interesting. And if the strategy we bring to whatever change we're making is working, fantastic, that's great. But in the music business, particularly since it's changed in the last twenty years, many of the strategies that we were indoctrinated as music people to believe don't work anymore, and it's boiling down for some of those people to I hope I get lucky. That's not a strategy, that's just
a wish. And so when you see somebody who says, oh, there's a new social media platform, my strategy is every time there's a new social media platform, go in early and make a splash, because I will have outsize influence there and it's more likely I'll grow to the next step. That's a strategy. It's not a strategy to say I'm going to sound just like this person and I hope I get more spins on Spotify.
Tell us more about your new book.
So a lot of people people like you will ask me questions that they think are marketing questions, but they're really strategy questions. And I don't do any coaching or consulting, but I like chiming in with interesting problems. And I found that people didn't see what I was seeing about strategy. Strategy is games and empathy and systems and.
Time.
Games, empathy, systems and time, and if you can see them, you can make a different path forward. Games are simply I made this move, it didn't work. I'm not a bad person. I just made the wrong move. I made this move. They made that move.
In return.
Systems are what you've been writing about so eloquently for all these years, right with personalities involved. But you see the system, you see which forces push things in which direction. Empathy is I don't know what you know. I don't believe what you believe. I don't even want what you want. But I'm going to bring you something that matches what
you believe you want. So if I'm a musician playing my hit for the four thousandth time, no one in that room has heard me play it four thousand times, I am bringing it to them because they need to hear it, not because I want to play it. So it's a gift and time. Time is the key to the whole thing in the music business. Not four or four time or five to four of your Dave Brubeck, but time says, the first day my record, my song is out there, only one hundred people are going to
listen to it. What do I have to do to make that one hundred go to two hundred, five hundred, one thousand and a million. Over time, these things unfold. And so when we think about the legends that are still in our lives, like you know, Joni, part of the reason is because she's been at this for a very long time. And there are other people who did a thing in nineteen sixty nine and then stopped fertilizing and stopped planting, and so time ran out for them.
So what we're doing is planting seeds to create the conditions for tomorrow.
You know, this is interesting. There are a couple of classic examples in the music business of people who achieved great success and then intentionally went in a different direction, alienating their audience. So you have people like Neil Young, he doesn't want to be pigeonholed. You have someone like Bob Doing, who happens to be eighty three. He is on the road singing material that most people cannot recognize, even when it's well known material. Are we just saying
he's saying to himself, I am this old. I can do it however I want to. Or do you think he has a conscious strategy?
So this is where the art comes in. And this is why I have so much respect for people like Herbie Hancock and Miles Davis and what Dylan decided to do several times in his career, the willingness to get booed offstage because the musicians say, I got into this business because I want freedom. I got into this business because I want to let the muse out. I got into this business because I want to be a musician,
not a cover band. And yet almost all the people who have been at this for a long time are cover bands of their former selves, and they gave up the dream in order to be popular. So when Miles played with his back to the audience, or when Dylan, according to his fictional autobiography, intentionally went back to the same city three years in a row, and what it says is the first year, what I'll do is I'll offend the fans who came to hear the old me.
The second year, the people I didn't offend will bring their friends, and then the third year I'll have my audience. Right, there was this act of independence. So I don't know Bob. I have no idea what noise he's got in his head. And lots of strategies are intuitive. But as a creator me, I regularly don't do sequels. I am trying very hard not to be a cover band of me because I got into this because I want to make art, not because I want to be popular.
Okay, I just want to don and I from earlier in on conversation, you're talking about the motivation of musicians in high school and you talk about filling a hole inside. Can you amplify that for us?
Okay?
So this the insatiable needs. That is how you become a billionaire. That is how you build something for the ages. Everyone has a need for lunch every day, but it's not insatiable. We don't eat lunch four times a day. One lunch is enough for most people. But we have an insatiable need to be loved often, or to be respected,
or to achieve something. And what often happens when someone becomes successful is they try to top what happened to them last time, which is why it's so difficult to win a gold medal in the Olympics, because you might not be able top that again. And so if that was your need to show the naysayas they were wrong and to always get a better personal best, you better find a new way to make a living because you're
not going to find it running to decathlon again. And so what happens often for the driven musician is, yeah, I'm in another city twenty three out of twenty four days in a row, in another grimy bar. But here is that chance to fill that hole again. And I know it's not going to be filled forever, but filling it tonight is the most important thing in the world
to me. So someone like Springsteen, who's worth more than half a billion dollars, how much would you have to pay him to go do a performance he doesn't feel like you couldn't. What he feels like is filling the hole at least for now.
Okay. I have a theory. People always ask how come these people have hits and then they dry up. Most of the people from the classic era today the landscape's different. Classic era. These were alienated people, didn't interact that well to use the vernacular, couldn't get laid. So they work with this incredible effort. They get wealth, they get sex, and they realize it still doesn't fill the hole, and then they just don't have the motivation anymore. They just can't do it anymore.
I think as part of it, I think.
A very big part of it is a fear of being seen as a front odd fear of failing from the perch that they're on. And so if you don't push outside of the new comfort zone, then you can't get in trouble. If you stay in the new comfort zone, you're back to being a cover band, and cover bands don't get booed off stage. And so it takes a much deeper hole to have to decide, Okay, I'm going to do a completely different thing and I'm going to fail at it. And you know, Billy Joel and Paul
McCartney and Sting make classical music albums. Well, they knew intellectually that the classical music world wasn't going to embrace them, but they needed the feeling that would come from going way outside that comfort zone, even if it meant that it wasn't going to work.
Okay, So once again, how much of this is conscious and how much is just intuitive? And does it depend what walk of life you're in.
So I was talking to a friend of mutual friend of ours who has made many gold and platinum records, and I said to him, so, what's the secret of a hit record? He said, Oh, it's the song, There's no question about it. You got to find a great song. I said, well, how do you know if it's a great song? He said, because it's a hit record, And he had no words to describe the intuition. So there
are many industries where intuition drives the whole thing. And then there are other industries, like I would say heart surgery, where being a scholar of it definitely helps you do better because the words help you improve quality as you go. So if you look at the way they used to make cars, the crafts people on the Rolls Royce assembly line could feel whether the piece of metal was going to be stressed or not. They could feel how it should fit together. You can't build a Toyota by doing that.
You build a Toyota by using words and measurement for everything.
So I think we have failed every.
Time we've tried to come up with words and algorithms for making hit music that lasts for the ages. But I think it's very clear that words help record executives do much better because now if they can articulate to people what they're trying to do, they can get other people to do it with them.
Okay, staying with the music business and staying with the traditional executives, the traditional pillars of success, print, radio, physical distribution have all been decimated such that a lot of things start independently, whether the especially online. To what degree must you change your philosophy with the external and what are they not seeing about the future?
Okay, so you've taught me so much about this, but let me try to use a different story to help people understand the system. There were two key things that most people would not name that led to pop music as we know it. The first one is the law of physics that affects spectrum of the radio. There can only be a few radio stations in a city, and when you're add FM, it goes up by double but that's it. There can only be a few. And number two the headphone jack. When Sony came out with the
transistor radio. The breakthrough was it had a headphone jack, and so for the first time in recorded history, teenagers did not have to listen to the music their parents were listening to. It made it so that teenagers, it invented teenagers could find what their peers were doing instead of having to sit in the living room.
With their parents.
Those two things created a forty year cycle that brought us all this classic music. And what happened, well, we got rid of radio and we don't need the headphone jack anymore. The end result is there is no scarcity of spectrum. There is no desire for the shorthad. The long tail is real. People connecting with small circles of people is real, and the music industry is gone. We
have music, more music than ever before. But the industry cannot be called the industry the way it was because it's not a few assembly lines turning out stuff that are hits. It is instead this permeable long tail. The
same thing has happened in my industry of books. The number of books published every year has gone up by a factor of twenty five, and the laydown of a new book, meaning how many of the stores take in the first week is down by a factor of twenty and so yeah, that's what decimated means ninety percent gone. And we're going to need a new model if we want musicians to make a living, and we need definitely need a new model if the people who help musicians and get paid.
For it are going to make a living.
Let's stay with books for a second, your area of true expertise. What's the future for books?
So five hundred years, a book is a physical object, and in order to get a book into a bookstore, another book has to leave the bookstore because the bookstores can't get any bigger. And this physical object that we had to spend years of our lives writing and bringing to you that effort is received by the reader. It means this is important. It's not a blog post someone about in fifteen minutes. Someone invested in this. So there's a lot to be said for the Pristian value of
I am holding this artifact. But it has been ripped to shreds, not with mal intent, but for sure by Amazon and Audible because it's very hard to tell a page of a kindle book from a blog post, from a series of tweets. And when we atomized ideas we rip the heart out of the industry. Add to that, the death of the independent bookstore and book publishing is on fumes, and it only survives because of the backlist.
It only survives, as you've talked about, because of the royalties you're making from the stuff you published ten or twenty years ago. This is a crazy time to start a new publishing company, which I just started working with. But books matter still, particularly to people of our general because they're a symbol and a totem. And I don't think we're ever going to see books be more important than they are today. And books are way less important than they were twenty years ago.
Okay, you have a new book, so what's the strategy.
So my strategy, which because I'm a writer I've said out loud, is this. I stopped looking for new readers twenty years ago because I found chasing new readers would force me to be a writer. I didn't want to be writing about stuff I didn't want to write about.
Could you just be a little deeper? What would you not want to be? What would you not want to write about?
So if what happened to the media of in my space anyway? Starting about twenty years ago is you should be quote authentic and vulnerable, and you should have meltdowns, and you should pick fights, and you should tell really simple things and this amazing secret will reveal everything, and you should dumb it down. And if you're lucky, when you do that, you could sell a whole bunch of clicks or books or whatever it is you want to sell.
But it doesn't last. And instead I said, I'm here to write for the people who give me the benefit of the doubt. I'm here to write for people who trust me to tell them something that they need to hear, and then maybe they'll tell their friends. So if those people go out and share an idea, that's when I succeed. I'm giving ideas to people who benefit from telling the others. So my strategy for the Strategy book is how do I create the conditions for people to talk about it?
So in addition to the book, I made the five point two million combination card deck, and I made the collectible chocolate bar with trading cards in it, and mostly I went on one hundred podcasts and I talked about it in a way that would help other people talk about it. Because I'm not trying to sell a paper
piece of paper. I'm not even trying to sell a book, trying to sell a conversation, because if the people who are listening to us today sit down with their colleagues and talk about their strategy, I will have accomplished something.
Let's say you're on a podcast and your goal is to get someone to start a conversation. You just say I am who I am, and that's going to be natural. Or do you say there are certain things I want to say and how I want to say them.
So what we're trying to do, whenever we make a change happen is to create tension. And the tension for a teenager with music is, oh, I haven't heard that new song. I need to hear it because I'll be left behind. The tension for somebody who in their dreams was going to go see Taylor Swift is the concert's going to sell out. I got to figure out a way to get a ticket before they're all gone. Tension is very common in things where there's scarcity and time
is involved. But there's other sorts of tension that come even just from the simple dana because the person who hears it needs to say Dana or else they're unsettled. So what I am doing with my work is opening the door for people to see where I'm going. But I don't steal the revelation. If I tell them every punchline,
there's no growth, there's no learning. So instead I can lay out this groundwork and they can come to the conclusion on their own in their industry that there's something they can do next and it makes sense to them.
Okay, so you have a new book. How far in advance of publication did you have the eye be to do the book?
Okay, so.
Some people, including me, in the old days, if you're in the book business, you need a book where you don't get paid. So I would wake up in the morning and think of book ideas. When I was a book packager, I sold one hundred and twenty books a book a month for ten years, and in order to do that, I had to think of a new book
every two or three days. That's what I did, and I stopped doing that about ten years ago because making a book is exhausting and I can get my ideas into the world much more efficiently and to more people with a blog post. So I only write a book when I have no choice, and I have no choice because the book made me do it. So what happened
here is I write every day, no matter what. And I started writing about a year ago, but not to write a book, just to write down a bunch of blog posts that I thought would rhyme with each other. And after I had written twenty of them, which took about three days, I realized there were all these pieces in between that we're missing. So then I had forty of them, and I thought, uh, oh, I have a problem now because I have a book. And I was not in any mood to publish a book because it's,
as I said, a slog. But it wouldn't let me go. So there was a book starting in November. I wrote it in not a lot of time, and then I rewrote it two or three times. Then the work of publishing the book that takes six more months of design and discussion and layout, and I do all the typesetting and coverge design myself, etc. Recording the audiobook cost me my voice for over a month, going to DNT and getting scoped. But the book won't let you go.
Okay, there was an element there I want to drive too, which is promotion. You know, the music business, we've been through a lot of stuff. In the last twenty five years. There was all the issues of leaks. Albums were coming out prior to the official release date. Someone in the manufacturing plant stole a copy whatever, and everybody was freaked out. Now we've actually gone two things have changed. One, it's
hard to gain notice at all at some level. Would be great if you were leaked, okay, And then a lot of major artists don't do any advance publicity at all. They just put the album out and then things go. So what's the status of advanced publicity today?
All right?
So Tim O'Reilly famously said your problem is in piracy, your problem is obscurity, And speaking just for me, if I thought five million people would read my book tomorrow, if I just uploaded the PDF, I would do it in the heartbeat. The hard part now for music but always for books, has been getting people to pay attention, right, And attention is scarce. You don't get any more of it. It gets rebuilt every day, but you don't get any
more of it. So what's the point of advance publicity? Well, if there's retail, if there's strawberries and Tower and three other record stores that are going to kick you out of the shelves if you don't sell in the first four weeks. You need to prime the pump. So the first couple of days are really hot, but Spotify doesn't kick people out, so there's no upside from a streaming
point of view. To advance publicity, what you need to do is become popular enough that the people who want to only listen to things that are popular are going
to listen to you because you're popular. And that happens when you concentrate the promotion geographically and over time, because that burst of focus causes people to say, you got to go do this, and you know, we see this with you know, about half of the time you review something that's on streaming TV in your letter, it's because it's sort of new and you're noticing it because other people are noticing it. And sometimes you find a gem that we missed a year ago. That's a whole different story.
But the story of launch and promotion is the author's job is to sell the first ten thousand copies of the book, and then after that, it's the book's job to sell the rest.
Okay, So in your particular case, the six months of getting it all together to publication date. You have these external products you're using as hype. How do you feel you're going to sell the first ten thousand copies?
So I recorded eighty guest podcasts over the course of two and a half months, and my deal with each person who is super great to work with was you got to hold it in Simbargo to October twenty second. So on one day I was on eighty podcasts, which means that you know, through the math, let's say eight million people give or take two million people somewhere in there heard me talking about this idea, and that was
my biggest lift to make it happen. And then the second part is I'm very lucky a million people read my blog in one form or another who give me the benefit of the doubt. And I said to them, with no advance hustle, today's the day. What I did a month before that was I said to the true fans, the people who are the super fans. I've got one thousand, seven packs, seven copies of the book, a chocolate bar, the strategy deck, and my online course together worth eight
hundred bucks. I'm selling it for one hundred and twenty five dollars. And so the people who for whom that's an instant yes, said great. And that means that we sold out in thirty six hours, and that's a little bit like what Ryano can pull off with a grateful Dead record. And so I sold seven thousand books before the book came out, So getting to ten thousand wasn't that much of a lift.
So how long do you expect the life of the book to be well?
I was at a conference on Friday and someone walked up to me and said, Purple Cow changed my life. And I wrote that book twenty three years twenty five years ago. So that's my goal. My goal is to write a book that twenty five years from now isn't some weird dated artifact, but is in fact worth looking at even then.
So you have all this great insight you did go to Stanford Business School, were you taught or is this all insight you gained individually?
I taught none of this at Stanford Business School. Stanford Business School when I went was an interesting cultural experience that was largely devoid of actual content that you could that would take more than six hours to read in a book. If someone had just like condensed everything they taught us. It would only take six hours to read.
But the cultural experience of being in a group of people who were expected to go into the world and do a certain sort of thing really made a difference when it came to feeling like an imposter, made a difference of changing the perspective you would have. And then the rest of it was being fortunate enough to be in the room where I didn't get thrown out when I said stupid things, and I could figure out what
a stupid thing was and not do it again. And that cycle doing it as fast as possible is the best life advice I have when young people ask me what they should do. If you want to learn marketing, do marketing. If you want to build a career, find the fastest growing company you can because in a fast growing company there's always.
A new job to do.
You're not taking away responsibility from someone else, it's just sitting there. Someone needs to grab it.
So, to my knowledge, which is not extensive, Stanford Business School is a little bit different from the others in that it focuses on small groups. A to what degree is it different from other environments and was it really the hothouse of being at Stanford because you hear a lot about Harvard Business School and it's people say it's primarily about the relationships they make more than what's in the school. So what was your experience.
Well, the best man of my wedding in my old business partner went to Harvard when I went to Stanford, so I had sort of a close view of this. The indoctrination at Harvard. Again, we're telling you a long time ago, but the indoctrination at Harvard is very intentional, and it's not just the relationships with your section. So here's one way to think about it. The first day of the first class at Harvard, you elect your alumni representative.
That's profound. I love that because they're sending this message that says you're going to sit through this for two years. But the reason we're here is because you're going to be alumni. But it doesn't change so much from year to year, so it doesn't matter if you're Harvard eighty six or Harvard ninety four. Harvard people are Harvard people. We know they're going to behave in meetings, we know they're going to you know, brutalize their way through when
it needs an unlimited amount of time or whatever. So they hire each other and they respect each other, and there's a status thing going on. Stanford when I was there, felt like it was much more focused on helping people see themselves as independent, thoughtful, consulting type professionals who could you know, like Samurai, who would walk into a place and be the smartest person in the room, even though
we weren't the smartest people in the room. It was just this understanding that being smart was sufficient, And I think that's wrong. And my gut is that they have changed it a lot since then, because what most business is about, especially the music businesses, in that meeting, in that interaction, are you engaging with someone else to create the conditions for something new to happen. This isn't about
using spreadsheets to squeak out an extra nickel. It's about finding a window that's worth opening and a door that's worth walking through. And that is a practice, just like writing a book is a practice and writing a song is a practice. But we don't do a very good job of teaching it to people.
Let's stay you mentioned consulting, not in other way. I'm going to bring it up. There's a huge backlash against McKinsey and other consultants. What's your view of consulting.
I have.
I don't think we've heaped nearly enough. Shame on the people who said I'm just doing my job but also busy figure out how to get more people to smoke a jewel or figure out how to get some monopoly to extract more money from people who don't have money. You're responsible if you're doing the work, your fingerprints are on it. You should own what you do. And consulting in general is magical when someone from the outside can see a problem that you can't see because you're too
close to it. But that's not what most consultants get to do because the hardest part of consulting is getting clients. And getting and keeping clients requires an enormous amount of understanding the status quo and making sure your right answer is acceptable. And it's not really about the right answer, because we're not doing engineering here, we're doing people.
I know someone who's CFO of a large company worked for one of these name brand consulting firms, McKenzie. I say, why'd you leave? Because I didn't believe in the model, Because they're taking fresh graduates. We're going out there. We don't know what we're talking about, right.
So you know, when you look at a place like McKinzie or Arthur Anderson that has so many people there, clearly half of them are below average no matter what scale you want to look at. But mostly the problems
aren't that hard. Mostly the problems simply require verbalization. When you hire McKenzie, you're often hiring them so you can go to the board of directors and say, I'm doing this because McKenzie said we should, and that's what you paid for, not that they came up with some sort of brilliant insight that you couldn't come up with on your own. It's very cool when you see the rare
moment when a consultant comes up with a brilliant insight. So, for example, in the eighties, seventies and eighties, digital watches started to show up. And there's something in the production of semiconductors called experience curve, which is the ten thousandth chip you make is way way, way, way way cheaper than the first one, and all these people who were making digital watches were pricing them fairly at three hundred dollars because it was costing them three hundred and two
hundred dollars to make them. And this consultant figured out and explained to Texas Instruments, if they made a lot of watches, they could make them for four dollars each. So Texas Instrument lowered the price of digital watches to way below what it costs to make, so that they would sell a lot of them, and thus their costs would go down and no one would be able to catch up for years and years. And that's exactly what happened.
That's that's a consultant bit of brilliancy. But that's not usually what consultants are busy doing.
It's interesting you speak of watches because in the watch world, especially with Rolex, which is a major brand, they're constricting availability. Yep. And you believe that's a strategy just about image or what do you think the thinking behind that is.
I love this topic, Bob, It's so much fun to talk to you. Okay, so we should talk about luxury goods. Luxury goods aren't better except at one thing, right, Like a Rolex watch does not tell more accurate time then.
It tells, it tells less accurate times I happened to have one.
Exactly than a digital watch. So what exactly do you buy? When you buy a burken bag or something from Louis Vuittont or go out for dinner for four hundred dollars, You are not buying the quality by most definitions of what you purchased. What you're buying is something where the motto is I paid a lot and I didn't get what I paid for. That the intentional waste of a verbulin of a what's his name verbulin good? Is the
price is the quality. The price is the point. The scarcity is the point that if they made as many Rolexes as they could, it wouldn't be a luxury good anymore. That what makes it something that's worth owning is that you can afford to have paid more than you should have for the thing that does what's on your wrist.
And luxury goods, as we see more and more income inequality, have become ever more profitable because the makers of luxury goods have figured out that every time they raised the price and lower the availability, profits go up, and so does demand.
Okay, let's go a little bit deeper, because this is happening right now, some of these luxury goods. Burbery, which is not a super top, they started appealing to the more casual customer. I won't say things are cheap, but they're not out of reach yep. And they have now been. The brand is on a downhill slide. Okay, So what would your strategy be for a luxury good I'll give
you one more exact Mercedes Benz. Mercedes Benz decided to decrease overall production and then move it to more expensive cars. So what do you think about the varying philosophies on each side of that.
Okay, So, once you're a public company, the stock market, which is an idiot, wants you to make as much money as you can right now. So if we think about outlet malls, Burberry, but particularly Ralph Lauren, discovered that they could make different products in a different factory. Call them outlet mall direct to consumer seconds or whatever. But
they're not seconds. It's not like they went and they got the seven thousand dollars cashmere thing and they found a little error in it and they're selling it for seventy bucks. It's a totally different sweater made in a totally different factory. The last time I checked, half of Ralph Lauren's profits came from outlet malls, from stores they owned in an outlet mall.
So it's a one way road.
You start down that road, you make a lot of money for a while, but it's almost impossible to reclaim the super exclusivity thing. So Burberry's has been dancing back and forth with this, trying to have it both ways.
Very very hard to do. So when you think about the car business, car business gets even more complicated because, unlike a handbag which you can leave in your closet, cars you're gonna drive around and cars you're gonna drive around for a while, and the narrative of the person who's buying the car if it's not the Maybach, if it's not the most expensive one, is much more complicated. So Mercedes is one of the biggest car companies in the world. It's really hard for them to make that
an exclusive luxury brand. It's also really hard for them to compete with Toyota. So there's somewhere in between, and there's always going to be this painful churn for people in that industry because they can't change the way Diane von Furstenberg Kay, Diane, you come out with a new line in six weeks for a small group of people. It takes six years for Mercedes to do that.
Okay, switching back a gear. You're from a similar vintage. I'm a little older than you. But when I went to public high school, there were uh, there were the art kids. Everybody was middle class. If you were rich, you drove a Cadillac. No one knew what a billionaire was, and no one ever wanted their kid to be an artist. But some people that's you know, the path they went down. So today life is much harder financially, just period. I just remember this comes up with by physical therapist all
the time. You know, you could live I'm seventy five or one hundred dollars a week, even if you adjust for inflation. You can't do that today. The scions of the middle and upper middle class. What people don't realize is people of that vintage young teenagers. They know the score better than anybody, and they don't want to grow up and be poor. They don't want to take the risk. So a lot of these more risky endeavors, certainly artistically,
it is the lower classes that enter these fields. Let me let me go a little sideways to make the point even further. When Survivor blew up, the people whod Survivor believed that they were now stars. That did not turn out to be the case, but they believed it. When we hit Jersey Shore, people say I'm doing this as a lark, that I'm going back to Poughkeepsie. There is no future here. So when you have the lower
classes involved, there's a different ethos. I'll do whatever you tell me to because this is just a lark, as opposed to the Jefferson airplane or the middle class artists of the sixties seven said, I don't want to do that. That doesn't feel good. So to what degreed does income, inequality, wealth disparity sit over all these creative arts and other elements of our society.
Wow, there are lots of ways into this, and I don't think there's a definitive answer. I think we can begin with the fact that for a very very long time, the only people who were professional artists were people of wealth, and they either had a relative who was wealthy or they were wealthy themselves. And you know, you got the Jane Austen, that whole thing. You're not finding someone who is in a small village making music with any expectation that there's going to be an industry.
That's going to propel them forward.
We get to this zone, the zone when the phrase writer's block was invented. Writer's block is a made up malady, and it started shortly before Ernest Hemingway was named by Percy Shelley, Mary Shelley's partner brother husband.
One or the other, you're out of my league, all right?
Anyway, Writer's block is an affliction of middle class kind of creatives who don't want to fail on their way up. So, yes, you're touching on something important here. Now we get to the current day, but I think what you're leaving out of it is this golden age of artistic riches that came from the scarcity from the gatekeeper. It's going away that you can win TikTok, you can win YouTube and get a check. But it's not an industry the way
it was when John Hammond would pick you. It's on an industry the way it was when you know, we listened to who was going to be the next hit.
So with that said, I don't think we're going to end up with a lot of people who are fifteen years old today growing up saying I'm going to be the next Van Morrison, because I think they are smart enough to know that there might not be that path that they shouldn't, you know, get on a bus, go to LA and hope to get discovered at a drug store because that's not you know, starmaking machinery isn't there anymore,
and I don't know what happens after that. We're not gonna runt of music, We're not going to run out of video slash movies, but it feels to me like the path is not particularly well lit either.
There's been consolidation in the record industry. There are three major labels who are putting out fewer records in few were genres in error before Because we've referenced earlier, they can live off their previous product, which is generating capital and essentially no investment. But for a mature business like that in a changing environment, what might they do.
Right?
So this is a key strategy question, which is the feeling of entitlement that we get about how do we keep this going? But you don't get tomorrow over again? So what should they invest in to be able to have the careers that they want to have because the shareholders are going to ring every penny they can out
of the assets that are already there. And what I've argued is we need to take a deep breath and think about what are the assets you own, and what are the skills you have, and what is the change you seek to make. So Simon and Schuster and Random, how if I had stopped by their offices, as I often did in nineteen ninety and said ask them those questions? They would say things like we organized the world's information.
And if I said, no, what you do is you cut down trees and then hold them hostage, selling them to independent bookstores, they would look at me like I was clueless. But they could have started Google. It only took two people to start Google organizing the world's information. Right, Why didn't the book publishers start the search engines? Why didn't the book publishers take this great corpus of stuff they have and own a big piece of chat GPT
Because they don't think that way. They're looking backwards, not forwards. So these three record labels have a particular competence in understanding what youth culture needs. Finding unknown creators and helping nurture those unknown creators to bring that idea in some form, to use culture to define in the generation. But instead of thinking that way, they're just looking for the next
Taylor Swift, and I think that's a mistake. I don't think the middlemen are going to be rewarded the way they used to, because creators are discovering that they should go to the middlemen after they've become a hit, and then they're going to get to keep way more of what they have.
Now. At this particular point in time, three major labels are either individually public companies Warner and Universal or Sony that's part of a much larger operation. No one there has skin in the game, which a you have a developing industry over decades, all these independent labels before this ultimate growth and consolidation to what degreed does having skin in the game affect employees and success.
I have no idea what share Walter Yetnikov had in the game. I don't think that's what he thought of on any given day. I don't think that the people who I've met and have known in the music business were thinking about it strategically. I think they had a job. They loved, and I think they had interactions, sometimes bullying people, sometimes stealing from people, sometimes taking credit for other people's work, that every day was more fun than the next while
they were doing it. Some of them got really wealthy, but I don't think that's what drove them. So what's missing for me when you bring in the nbas and you say, here are the spreadsheets and here's the balance sheet, go make us some more money, is if that's what you're if that's what the prize is, that's what they're
going to go get. And this industry and the stories that people share with you on this podcast make it very clear this industry at some level was built by people who love the game, not by people who want to make as much money as possible.
Switching gears a little bit, we talked about Bill Gates, We talked about your experience at Stanford. Right now, there's a huge discussion about whether people need to go to college or not. If you had a family friend, you know, and they had a teenage son, not a schlepper, as we put it, someone who could go to a good school, but says I have a business idea, I have to do this. What would your advice be actually.
Give advice like this all the time to family friends. First of all, you got tricked too by the college industrial complex. You said good school. There's a good school and a famous school. Famous schools either have football teams or endowments, right, And it's very clear, and there's plenty of data to show this that people who get into Harvard and don't go have just as much happiness and wealth in their life as people who get into Harvard
and do go. That the hard part is having the privilege and background and experience to get in, not what they did to you in class. Add to that the fact that you can take any class you want in the world for free online, maybe not at that institution, but somewhere. So what these institutions are selling are two things. One the badge accreditation proof that you got your ticket stamp, because that way you don't have to teach somebody everything you know. You can just show them this one piece
of paper and they make assumptions. And the second thing is group cohesion, a group brainwashing to say, people like us do things like this, this is the way we see the world. And so for a long time, Saturday Night Live was written by people who worked on the Harvard Lampoon, and you know that's where a lot of talk show people have come, etc. Because the indoctrination of being a student at the Harvard Lampoon for all those
years was actually your college experience. So now we've got this grand reshuffling, and the question is what would make you good at the future. And I don't think it's I need to start a business and make a lot of money and I can't wait four years because there's always going to be a problem worth solving. I think it's what experiences are you collecting and where are you learning these lessons? And how are you learning them? Do
you have the discipline to roll that yourself? Are you willing to read a book a week every week for the next four years instead of going to college? Because if you need high school discipline to get smarter, then doing it on your own is probably going to be a mistake because you're gonna get stuck in that rut. And so what I challenge people to do is two things. One,
I think almost everyone should take a gap year. They should take a year to do a hard project with some supervision, to grow up and to discover what it's like in the real world to understand that college isn't like high school, but with more binge drinking, it can be something different than that. And then the second thing is to go to the cheapest, good enough school and use the money to create experiences and a curriculum for yourself so that you learn way more, way faster than
your peers. And most of those things require discipline, and unfortunately that's hard to find. But if you can do that, I think you come out ahead.
Tell me about the hard project that you might do in a gap year.
So a friend of the family came to me years ago and said I'd never met him. He said, my dad knows you. He said you could tell me how to get into Yale, And so I gave him ten projects you could do, and one of them was fly to India and figure out how to make enough money to get home. Now, the problem with that project is it doesn't take a year, and it's not particularly generous.
But if you.
Find a nonprofit that is working deep in a community to help transform that community for the better, and you commit to spending a year with them, you don't need the Peace Corps to send you somewhere. You can do that tomorrow. If you decide to start a record label, which I did years ago, you can start a record label tomorrow, run it for a year fully online, see
what happens right that. If you're doing that and you know that you don't have to make money doing it, you have to make a difference doing it, you will learn an enormous amount compared to going tow NYU and taking a class in music production.
You know you're talking about. Let you know, let's say I take the path where I'm not going to go to college. I read a week, I do this. I have found amongst the people I know, other than the very successful people I know who I know, no one has this level of discipline.
Yeah, so where's the discipline come from? How long do you need external discipline before you'll understand internal discipline? And how can you practice it the same way you practice the trumpet? Because I think you can practice discipline for a week at a time. And so if you're asking what I would say to a sixteen year old family friend, the woman down the street who I worked with, she put on a massive climate conference for high school students
in our county and over one hundred people came. She had guest speakers. She got a grant on her own from the Bloomberg Philanthropies, and she put this thing on. If I look at what she did compared to all the other students in her high school class, there's no comparison how she spent the last six weeks. She's going to remember this forever. She discovered she's not a fraud, and she's discovered all the things that don't work and
some things that do. So no, don't skip college and commit to a four year thing out of the blue.
But show me a one.
Week project, and then a three week project, and then a five week project, and then go to a gap year.
And if you have no.
Self control whatsoever, yes, please go to the most famous college you can pay for. Get on the track of getting one of those scarce jobs where someone tells you.
What to do.
But for almost everybody else, it's this combination of generous persistence, self discipline and solving an interesting problem, because if you get good at solving interesting problems, you're never going to need to go get a job.
Now. Ultra successful people, let's not talk about someone who worked their way up at Procter and Gamble and is now on their private jet people who have a more entrepreneurial path. Are they all inherently using the vernacular fucked up trying to fill some hole? Is that what drives? Are there any well adjusted? I mean, look at someone like Elon Musk, certainly a lot of success, but he's evidence seeing the issues in his personality right out in public. Does that go with the territory?
I would like to leave out of the discussion the few handfuls of people who are in the media because a lack of boundaries and media attention are a very challenging problem for everybody else. And I know a lot of people who have succeeded on their own with projects as entrepreneurs. Most of them are well adjusted. There's a game being played here and they don't take it too seriously, and they see the game.
And when I.
Started, I took it all personally. And when you take it personally, it doesn't feel like a game. When you take it personally, you get rejected. I get eight hundred rejections in a row from New York publishers. It feels like they are rejecting you, and it takes a while to realize they don't know me. They're just rejecting what
I sent them. What we have now is this weird media structure where you're supposed to be vulnerable and you're supposed to be authentic, which I think is nonsense if you're trying to strangers and then when it doesn't work, you end up in a ball on the floor instead of saying this was the move. I brought this to the world. That happened. How do I do it differently next time? And I believe that's what great musicians do,
particularly jazz musicians. You watch a jazz musician and they know when they're launching into the next lick that in this setting, in this room, it's going to work. And the reason they know that is because they've done it before and they see the difference in the room between one that's going to work and one that doesn't. And that's the opportunity amidst all the chaos and mailstroam that
we're in of solving interesting problems. Is you can practice without a medical degree, without a legal degree, without a business degree. You can practice human interaction and get better at it.
Switching gears. Once again, there are different This is streaming television Netflick releases all episodes of the series at Once Prime used to do that sort of at this point, but the other competitors, Disney, Paramount, Apple do not. What's your insight there?
Yeah, I read.
You were ranting about this the other day. You and I disagree, which happens from time to time. I was talking to Ted Sarandos at Netflix. I said, Ted, I only want to ask you one question. I completely understand why you started with binging, and the reason is this. What Ted and Reid figured out how to do was use stock market money to send a signal to Hollywood
and to viewers that you couldn't live without Netflix. And the way they differentiated themselves from every other way you could watch television is they weren't gonna hold TV hostage. You can have all you wanted. The only way you can do that is if you have an enormous amount of money, because you blow through one hundred million dollars TV series in a day. Right, So it was brilliant, but now they won, and once they won, it's not in their interest to keep allowing people to do this.
And the reason is what they gave up was the water cooler conversation. Because if you've seen seven episodes of Lydia poet, and I've seen one. If you talk to me about it, you're going to ruin it for me. So you don't talk about it the way you would if it was on every Monday. And so I said, ted, why do you keep doing this? And it was fascinating because I thought he would have a detailed, nuanced database research answer. And he said, because that's what we do.
It's been built into the culture. But I can show you the economics of it. They should stop, and I think they will because they can't keep burning shareholder money the way they were and the game theory of it doesn't make sense.
Tell me more about the game theory and game theory in general in business.
Okay, So game theory has nothing to do with monopoly and everything to do with understanding what people do when they each seek to maximize their benefit. So everyone understands tic tac toe, and we understand you shouldn't go in one of the side pieces, you should go in the center because that forces the other person to go certain ways.
So Netflix looks at the world a lot of entrenched players, people with lots of backlists and lots of libraries, and say, we can't possibly make enough really really good shows in a very short period of time that will get people to join us for money when they could watch these other things on television for free. So what we're going to do is play a game they can't play. And this is the key to strategy, playing a game your
competitors can't or won't play. And the game they could play is they could sell more stock anytime they wanted. They could lose as much money as they wanted as long as they were getting new subscribers. And by saying to NBC or HBO, we're going to break your cardinal rule. We're gonna take our best show and just blow it all in one day, the opposition couldn't respond because they didn't have enough money or inventory to catch up to that game. So they redefine the game the same way.
When you look at Hotmail, which revolutionized viral marketing, everybody else was charging for email accounts. Hotmail built a company that was structured so they could give it away for free. By making that move, they undid the game that everyone else had no choice but to play. So what we you know? And when Rick Rubin leaned into hip hop, he was making the bet that the big guys weren't willing to go where he was going to go, and
he was right. It took them a very long time for the people who were running those labels to get comfortable bringing out the music he was bringing out because of their upbringing compared to his moment in time. So again, what we're seeking to do with game theory is understand the rules of the game and then make moves that either box out the other people or moves that they are unwilling to make.
Okay, staying on streaming television, Apple uses the old model of an episode a week, right, financial disaster. Okay, Now they're leaving intentionally certain low hanging exploitative fruit on the ground. It's like they won't just do something with titillation, nudity. Whatever they do these high cost productions, there is no catalog, no backlist like Netflix licenses or now actually owns. Sir, what would you tell Apple?
Okay, So let's be clear. Apple TV does not exist to make a profit, and if you are looking at it through the lens of making a profit, it would it seems like a mystery. Apple TV exists to be a branded arm of a luxury goods company. Apple is the most successful luxury goods company of all time. You can buy a phone that does almost everything an iPhone does for a lot less money. The one thing it doesn't do is give you the blue bubble and the Apple logo, and so that is supported by the halo
of something like Apple TV. So what Apple needs to keep doing is create this reality distortion field around the value of what they make and sell people identity.
Staying with Apple for a second, Steve Jobs famously did no market research. What's your view on market research? Well, Steve did a lot of market research. What he didn't do was pay consultants for traditional market research. What Steve did was he had an intuitive understanding of the needs, desires, and identity of the people who would propel his thing forward, and he played it like a violin. He totally understood status roles and how to turn this thing that was
for geeks into a luxury good. Most market research, most focus groups exist to make the committee happy. They don't exist to lead to hard decisions, and corporations are organizations that stick around for a while, and there's a lot of soft tissue in between the various people and market research can be used as a tool a lever to help people empower stay in power, but it is not often used to help them make better decisions. Okay, on the same point here with making decisions. Ultimately, let me
put it down. A mature business, Okay, skiing. Skiing in the sixties, it was a middle class sport. Everybody did it. Okay. Starting in the late eighties they put in these high speed lists, which costs a lot of money, improve the experience. Okay. Now there's been consolidation. There's two major companies which actually
are spreading from the United States to internationally. Now a there's a perception problem because skiing is never been cheaper to actually do, never mind the number of lodging and food, et cetera. But it's a mature business. Where does a mature business go from here? They're not Sierra Club. You can't build more ski areas, concert promotion. We have Live Nation in aeg Okay, used to be the land of renegades. When you have a mature business, what happens next?
So, uh, your rant on this with Zach Cune was brilliant. I loved listening to it.
Zach.
I don't know if he told you it was my next door neighbor, so I watched him grow up. He doesn't live in New York anymore, but skiing is, and I did it for a very long time until I directed both my shoulders. Skiing is clearly a mature industry, but it's also a luxury good. It's a luxury good because it costs way more for the actual athletic moments
of it then it's worth. What you're paying for is the way it feels to go, the way it feels to talk about it, the way it feels to put on the equipment, the way it feels to be in the lodge. That is what is actually for sale. The data I saw a few years ago is that the typical visitor to Veil was on the slopes for less than forty five minutes a day. Because that's just a tiny part of what is for sale the nation skiing
I went. I grew up skiing at Kissing Bridge in Buffalo, which is basically a big hill, and you could do thirteen runs in an hour. And so the people who went there to ski, they were skiing, they weren't partaking in the luxury lifestyle of skiing. So what to be done, well, what's always done with an end of cycle. Stable businesses is you raise the price for the people who are
committed to going. It is really, really difficult to capture the next generation because you don't have the network effect, the viral connection that causes the next generation to come in the numbers. You need them to come to keep the business going on in the way you wanted it to go, the same way if you had you know, whether it's Georgia or Armani or Heart Shaftner and Marx hart Schafter in Marx doesn't have a prayer of capturing people who are twenty years old. People are twenty years
old are never gonna wear three piece suits. It's not coming back. And so what I think it's worth embracing is Schumpeter's creative destruction. There's nothing that says this particular corporation is entitled to last. And the half life of American corporations keeps getting shorter because people stick around, but brands and corporate entities they're designed to be disposable.
Well, staying on that same point, antitrust, I have a friend who is a liberal who does not believe in the antitrust enforcement, believing that the marketplace will always ultimately come into competition.
He is.
Example would be I'm gonna ask your take.
That's why having trouble with keeping my take to myself. But go ahead, yes, no, no, I want to hear your take.
Okay. He we know Google's search has now been challenged by Amazon by TikTok have by the same token. Google is being sued because they have monopoly on advertising. What is your belief in the anti trust and monopoly?
Okay?
So we begin with Adam Smith, who I think everyone can agree is the known father of capitalism. He has many lines that say the biggest defect in capitalism is monopoly. Monopoly is broken capitalism. And the reason is simple because once a company gets to a certain scale, the single most profitable thing they can do is create the conditions to have no competition, to lock people in. And if they do that again, the math is super easy to show.
The consumers do not benefit that it harms everyone involved. And so what we need is what Coreydoctor calls adversarial interoperability. Adversarial interoperability says, go ahead, get as big as you want, but you must build doorways so that competitors can play in a way that gives customers a choice, because the market, when it works, is about giving customers a choice. Now, what ended up happening here when antitrust began to get
corrupted in the seventies and the eighties is simple. Milton Friedman plus others started trying to persuade us that the purpose of our culture is to enable capitalism. They got it backwards. The purpose of capitalism is to enable our culture. And as long as the market is actually free, where people can make a choice, that is more likely to happen.
But when monopolists are unfettered and can lock people in their choices, go away, and nobody benefits except the monopolist, and in the long run, the monopolist doesn't do as well either. If Microsoft had agreed to be broken up all those years ago, or IBM, both those companies would be doing better today than if they had fought as hard as they did to stay.
Together, giving IBM just staying with Microsoft. What would Microsoft look like today if you've been broken out?
So Microsoft got in trouble and I was a victim of one of their hijinks years and years ago, because they owned the operating system, they owned the web browser, they owned the software stack, and they kept feeding them one into the other into the other. So for example, you click on a link in word and you had no choice but to have Internet Explorer to be able to look at what it had. So you can seeeople would suffer because there's no incentive to make a better
web browser if the it doesn't hook up right. And if the shareholders end up with each one of the platforms, then the amount of value that's produced for consumers goes up. And when the amount of value that's produced goes up, each one of those companies, even if they're not going to have one hundred percent share, will end up being more resilient and do better over time. And so when they broke up at and T and built the baby Bells, I think, I mean, we didn't have mobile phones. Fax
machines were pain in the neck. Think about the explosion in what we could do with telecommunications once different companies
could play in a different way. And so instead of spending all that time and money having an existential fight about breaking up, if they said, all right, we're going to build the breast browser in the world, and now it's going to work with every word processor, and we're going to build the best software stack in the world, but now it's going to work with every operating system and on and on and on. They would have ended
up way ahead of the game. And that's that's largely what they're trying to do.
Now, let's be very specific with Google, which has almost all the market share and conventional search. Yeah, what would be the best solution there for everybody?
Okay, So I built a company to raise money for charity called squid Doo before social media really caught on. We were the fortieth biggest website in the entire country. I had eight employees. There were three hundred thousand people building websites. Most of the money they were value they were creating was going to charity, and again we were fortieth.
One day, Google did the math and realized that we were sending a lot of traffic to Amazon, and Amazon if they were getting traffic from us, wouldn't have to pay Google as their largest advertiser for promotion. So our traffic in one day went from being the fortieth biggest website in the world to forty millionth They turned.
Us off just like that, flip the switch.
So even though it hurt me, in three hundred thousand other people. That's not my point. My point is when you have one person who has the switch, they can't help it as a public company, but to keep flipping it, to keep pushing. So you may remember the old days of Google, the homepage would have maybe one ad on it, maybe a few on the side, and now there's almost no links whatsoever because they said to the people in the ad business, make as much money as you can
by any means necessary. So this doesn't help consumers. It also doesn't really help advertisers, and it doesn't help the ecosystem that's being built. So there are lots of suggestions as to how a company like this could work. But
imagine the following. You've got Google, the search core, which likes this is itself to anybody who wants to start an ad network, and you've got all these different ad networks that work together with different search engines and different interfaces to create different experiences for different kinds of users. The end result would be the market would decide which kind of interface and experience they wanted when they were searching, and the ones that weren't serving their consumers well would
fade away. Advertisers would want to pay extra to go to places that work better for them and the consumers, etc. It wouldn't be one organization saying how do we make this quarter's numbers? It would instead be an ecosystem of solutions. And I was at Yahoo when Yahoo tried to be the monopoly that Google is today, and it's really toxic in the end because you have to make compromises that you're not proud of.
Okay, just taking me with the ads, The user experience on Amazon is terrible. Now you can't find what you're looking for. Is their room for a competitor? What advice would you give to Amazon itself? Right?
So Amazon only makes a little bit of their money by selling things like books, and they make billions of dollars selling the ads. So how does this work?
Well?
For many products, the only way that you're going to get any clicks at all is by buying ads because that's what people see. So how do you pay for the ads? Well, Amazon has a policy that you have to offer the lowest price you offer anywhere on Amazon. So instead these companies raise their price on other sites to make enough money to have their ads run on Amazon, which means that Amazon becomes more attractive to consumers because
the price of the thing everywhere else is higher. So this is a death spiral that doesn't help anybody except Amazon. And their thesis would be, well, if it's legal, we can do it. And community action is the spirit of saying yeah, but we're the community and we are coming together saying you can't do that anymore. And Amazon is filled with some very smart people who can solve problems when you give them constraints. And so there are plenty
of constraints. I can imagine where you can say there are different ways that the algorithm can be used, different sorts that could be available, different kinds of experiences you can have. And there's a warehouse company that knows how to ship stuff, and there's a website company that knows how to run things on the web.
But having it.
All in one place with a tiny group deciding what will make them the most money this week, I don't see any data that says that's good for all of us. It's not. It's not good for any of us except the people who need to make the stock price go up.
Okay, so at one point, if one forgetting the changes in government we have Leni Khan now won't enter in the new administration. At what point do you say you're a monopoly and we should take action? What is the trigger?
Okay, so I need to reiterate I am not an expert in any of this. I know people who are, but people who are conservative should and many of them are opposed to monopoly power because it's the opposite of this idea of small markets and people taking responsibility for what they do. And Robert Work and others worked very hard to change the definition of what made something a monopoly.
In the old days, the definition was, by definition, if you control a big chunk of something limiting people's choice, you're a monopoly. The new definition eventually became, if prices are going up, consumers aren't benefiting, now we're going to take action. That's not the reason it's not valid is prices for some people might go down, but you still have all of the hard to measure effects that come
from a lack of choice. So it is harder today, for example, to somebody, for somebody to build a business online unless they're going to get an unreasonable amount of traffic from Google, so people don't even try, right, It is hard today for someone to build an alternative to YouTube because they know that it's so deeply ingrained in the Google infrastructure that they're never going to get the
traffic that they need, so they don't try. And what we're looking for in a civilized, industrialized world is the churn that comes from these innovations. Patents aren't the answer, Monopoly power isn't the answer. The answer is people solving other people's problems and getting paid for it. And you know, we saw what would happen when someone tried to corner the market in music. They try every few years. It doesn't help anybody except for the person who's trying to corner the market.
Well, staying in music, we have the government suing for a breakup in Live Nation and ticket Master. Now, if you use the definition of pricing, it will not affect price whatsoever. The government's position in the modern era would be, well, if you divide them up, it will stimulate innovation. What is your thought there?
Yeah, So the scalping thing is this fascinating understanding of supply and demand. And back to this idea of monopoly that when only one person is allowed to sell the tickets, you have this interesting dilemma that they have. So I talked to Bill Graham when he came to Stanford in nineteen eighty three, and I was like this young whipper snapper, and I raised my hand and he says, what do you got? And I said, but you got Springsteen coming
to San Francisco. You're only charging eighteen dollars a ticket. Why are you leaving so much money on the table. You could get a hundred, and he said, because I book all the concerts in San Francisco. And yeah, I could get a hundred for Bruce, but then my customers would be out of money by the time we got to March. So I'm taking this long view, and I've remembered that for a long time, because you're right, when you write about the scalpers, someone is gonna charge extra.
It's this whole lottery mindset doesn't make any sense. But that's I don't think at the heart of why you want to think about monopoly power with someone like Live Nation and Ticketmaster. You're correct, it's not how to get rid of the problem of scalpers, even though it makes good sense politically to go after it. When you've got young people who are obsessed, who are insensed because they
have to pay so much. I think what we're talking about here is what kind of choices and innovations will come from those choices when people who are behind the scenes here have a choice when they play folks against each other. Would Ticketmaster have to lean harder into its technology stack to come up with innovative ways to deal with scalping if there was someone breathing down their neck?
And I think history would say yes they would. And when you've locked up all the useful venues and contractually people can't compete with you, I don't see how that comes out in favor of the artists or the fans.
Staying on the same subject of the touring, one of the reasons we have this gap and all this problem is the acts believe that if they charge what the ticket is worth, they will be perceived in a negative way by the fan. What would you tell the act?
Okay?
So the principle of permission marketing is delivering anticipated, personal and relevant messages that people who want to get them.
Is the future.
A lot of what people are interpreting when it comes to this ticketing thing is that the artist has no understanding of who the fan is. That I gave a talk at Columbia Records a few years ago and I held up a Dylan album from sixty five and at the back it said you could write to Bob at this address. They threw all the letters in the trash. Of course they did, what were they going to do with them? But now artists can directly connect to fans.
If you can imagine a scenario where fans that are connected to the artists for the long haul and demonstrate it, get tickets at a price that makes sense for them, you have differentiated the audience. If some of them want to turn around and scalp it, well they got a prize for being a fan for a long time. But most of them won't, and so you will end up with the right people in the room who know that the ticket was worth a lot because someone offered them
a bunch of money on their way in. That builds your fan base for the long haul. But what I'm trying to highlight here is there's a technology thing that's new that's missing from the old way of thinking about it, which is, instead of finding fans for my music, let me find music for my fans. And if a fan can demonstrate that they're really a fan and I can take them on that journey that benefits all of us.
And so I don't know practically how I would do it, particularly for up and coming groups, but I would imagine it would be something like, there's a talking heads to our coming dire straits is going to open for them. As a result, they get to piggyback along on that attention and that trust, and so the artists become more of a kingmaker because their taste extends and their circles grow again. We've taken out the selfish middleman and flattened it a little bit. But I'm making all this up.
I don't know, Okay, going something more in your air of expertise. Clayton Christensen, who's no longer with us, wrote the book Innovator's Dilemma, which was about disrupting yourself before you are disrupted. Now, just staying this a little inside baseball, there was professor at Harvard said, there's no such thing really as disruption. So what's your take on all of this?
He said, there's no such thing as disruption?
She went. He said, yes, I believe that's the woman, But I don't want to saying that. If you look back at history, all these companies that they said were disrupted ultimately one in the end. Let's leave that aside. Okay, let's talk about Clayton Christensen. Do you believe his philosophy was correct?
Western Union had the chance to buy AT and T and they didn't. They made better telegrams instead. And I was at Yahoo when they had the chance to buy Google for ten million dollars and they didn't. The reason there's this challenge is that innovations at first always suck, and compared to the polished, perfect and profitable thing you've already got, it's very hard to say, oh, no, no,
we're going to do that. It's very hard for GM to say we're going to make the first generation of electric cars because it doesn't match their culture, it doesn't match their strategy, and so you end up going to all these meetings where you have to justify it. It gets dumbed down, averaged out, and someone else with less to lose goes ahead and does it instead of you. And this challenge happens over and over and over again, and being willing to start with it in a way
that makes the powerful people uncomfortable is very tricky. So another Netflix story, so Ted and Reid decide after they've beaten Blockbuster that the only threat that Netflix has for the near future is streaming because Netflix is making all those DVDs in the red envelopes they want, but someone they believe is going to come up with a streaming solution and wipe them out. So they decide they're going
to do it. And this is a classic innovator's dilemma problem because remember DVDs, they're perfect, the video is really high quality, the technology has all worked out. They know exactly what to do. They're buying them from the studios and they're making a fortune. So Ted and Reid start this project. And the first rule is this. No one in the DVD division at Netflix, which accounts for one hundred percent of their profit, no one is allowed from that division to come to the meetings.
Think about that.
That's when Netflix became Netflix. That was an act of brilliance because they knew that the DVD people were in the room. They'd have to average it out, dumb it down, keep it small, and they yeah, it doesn't look as good as a DVD, and we're not gonna make as much money as a DVD. But they didn't have to have those meetings because they weren't involved.
Well, staying on that same point point is one would remember the transition. They announced that they were streaming company. They were ahead of the consumer. The consumer revolted, then they blinked, then they went back to streaming. If you are a company, you know, I look at streaming music. Streaming Music when it launched in America was way ahead forgetting Rhapsody before, but Spotify, which really changed the game. It was ahead of what the public wanted. So to
what degree do you consider the public? To what degree do you plan to get the public in your hand? What are your thoughts on that?
Which public? Which public? Is the key to all of these things. So I got online in nineteen seventy six. I was Prodigy's first contractor in the nineteen eighties, and I showed Prodigy to people and they said, that's stupid, that'll never work. And if Prodigy hadn't shan changed, that's correct,
it never would have worked. But which people? There were some people who said this is for me, and I'm going to tell other people, particularly as it grows, because what you're not trying to solve is what's the expression of the solution. You're trying to identify what's the insatiable whole the project, the problem that I can begin to solve for customers. If I can begin to solve it, I get traction, and customer traction is the key. If you're an A and R person, what you want to
know is the fans of this band. How often do they come back? Not how many fans do they have, how often do they come back, and who do they bring with them? Because if the answer is they don't come back and they don't bring anyone with them, it's a stiff. But even if they only have a thousand fans, but they can't stop showing up and talking about it, Now you have something that's in an innovation.
Okay, when did you decide that you were going to blog every day?
So I started blogging on a platform before this one and before that one in the nineteen nineties or just around two thousand and It was just a way of telling the skeptical people I was related to that I wasn't doing nothing all day. It was just like an update as to what was going on.
Wait, let's slow down, my Literally, the skeptical people you were related to, meaning you were family, were they down on you because it was a dip in your career, or they couldn't understand the whole world of the internet. What was going on?
Yeah, I mean it began as an email newsletter in the nineties. It was I had no no, no, what was going on in your family? No, I'm getting driven right, Okay, okay. I hadn't sold my company. It was struggle. I didn't have a job with a name, and there were plenty of people who were.
Like, what do you do?
So I could write these letters. These not that different than I left this letter to people saying is this I tried this, this didn't work, blah blah blah. And then sometimes I was Once I had this new platform, I was doing it two or three times a day, and I discovered that there was a voice that sounded like my blog voice. The first one hundred posts, I
probably only had two that sounded like me. If you go back and you look at the one on my visit to the Apple Store, that's the one where I thought, oh, I sound like this now on my blog. And what I didn't want to do was regularly decide if a blog post was good enough to post. So I made the decision once that there's gonna be a blog post tomorrow now because it's my best but because it's tomorrow.
And once I made that decision once, oh, it was so great because then all day you're imagining what are you going to do for tomorrow's post because there's going to be a post, and having that hole to fill transform my writing, and it transformed the ability I had to have a conversation in front of people.
But that can be a burden. You can wake up and you can say, well, I got to have something for tomorrow. If I knock it off at ten am, I'm free for the rest of the day. If it's eight pm and I haven't written anything yet, what am I going to do?
Yeah?
And so that burden is called work, and that's what I wanted was to sign up for it. I needed a hack once I got to a thousand, because when they got to a thousand and I went, oh, I have a streak here. Now I'm up to almost ten thousand. I have a streak here. I don't want to get the flu and blow my streak. So I figure out how to queum up. So now I can take a day or two. Often there's still going to be a post tomorrow. But what I do is every night before
I go to bed, I read tomorrow's post. At about one out of five times, I delete it and just write a whole new thing.
Okay, how do you feel about repeating concepts and ideas?
If I'm not doing that, I'm making a mistake. I gotta be repeating ideas and concepts.
This is not.
A demonstration of how creative I am. This is me Teaching and pedagogy is about repetition, consistency, frequency, and helping people like My best blog posts are very simple. My best blog posts are I tell you something you already know in a way that makes it easy for you to tell your friends.
That's what I'm trying to do.
But every once in a while, I mean, I have still have bookmarked your original permission marketing post, and you wrote one a couple of weeks ago that I wrote about that really made a huge impact. What is it like when you do this is something I don't know. Maybe you'll agree with me, maybe you won't. When you do something that's in eleven, you know you've been doing it so long you're never gonna write something terrible. But every once in a while, you write something transcend, it's
the nature of doing it. Does it bother you that you sort of can only do it once. If you're a musician, if you write a hit song, you go on the road for forty years and play that song. Okay, do you ever feel I wrote it? It was great, and now tomorrow it's another thing?
You know, Bob, There's two answers to this. The first part is I will write an eleven and no one else will know.
That.
I have no clue which posts people.
Are gonna love.
None.
And the second one is when I do write something that resonates, I don't forget it. It shows up on podcasts, it shows up when I'm on stage, it shows up in a book, And so I'm you know, no, I don't get to play free Bird all the time. But I also don't have the problem of having to play free Bird all the time. But I have riffs that become the fabric of the foundational thing I'm talking about, And when I'm on stage and I know, I get to bring up the next one because I don't have
a script. When I bring it, I'm like, oh, this is great. And every once in a while it'll stop working and oh I love that one. It's gone now, So there's that. But I disagree. I don't know when I write an eleven, I.
Wrote, okay, to what degree does feedback affect you?
So there's no comments on my blog There used to be comments. What I found was within a week I was writing differently because I was anticipating the comments and writing to avoid that criticism. Whatever I thought would happen, and my writing went to shit. And so I said, I'm not gonna have true choices. I can either have a blog with comments and no blog posts or a blog with blog posts and no comments. And I went with blog posts. And I don't regret it one bit.
I don't know how you do what you do. It's a miracle. You and I are completely different in this respect. And then Amazon reviews, A one star review from an anonymous person who didn't get the joke would really unsettle me, because a one star review doesn't mean it I didn't do a good job. It means it wasn't for them, and I haven't learned anything from that. So I stopped reading my one star reviews. But if you didn't do that,
you have to stop reading your five star reviews. So I haven't read an Amazon review in seven or ten years unless someone emails it to me, which I don't want.
Them to do.
Okay, but you're not someone who lives in complete isolation. You're out doing gigs whatever. There are some greatest hits. I'm sure people come up to you and go, you know what you wrote about X. Yeah, I read Okay, Purple Cow, Yes, which you've been. But my point is just go because I'm interested. You don't know when you hit it way out of the park.
When it's just me in my underwear, no idea. So I don't talk about evolution on stage anymore, and I hardly blog about it. I wrote a book it took me nine hours a day for a year called Survival Is Not Enough. Charles Darwin wrote the forward. I am super proud of that book. And whenever I start talking about sexual selection and mutation and all the stuff that I know a lot about crickets, just the room, just
people's eyes glaze over. They do not want to go to the next level of understanding how ideas are like jeans and all that stuff. And I get talk about it all day and people don't want me to.
So I don't. It's done. But when I wrote it, I was like.
This is Nobel prize stuff, this is this is an eleven.
Nothing.
Okay, you know in my particular case, certainly when it comes to politics in the national vibe, I get that from the feedback. Having said that, I understand your concept completely. It is inhibiting getting the feedback and wrestling with that all of the time. So how do you put your finger on the pulse? How do you take the temperature? What is your input?
So I mean, I'm meeting hundreds of blog posts a day, and I'm in the world and I talk to people. But here's my thesis. Most people have been indoctrinated if they see something they don't understand to just walk on by. If there's something in the world that is illogical to me that is working, but I don't think it should work. That isn't working, but I think it should work. I can't let it go. I have to sit and look
and look and look until I have a thesis. And that exploration is the fuel for a lot of my work. Please explain to me how the culture ended up like.
This, and before we know, what's the status of your stereo?
So I built speakers and some two A three two bamps that I got that are handmade, and of course Paul McGowan built all the stack on the streaming side. But these speakers, which I painted in Evecline blue, combined with the three watt per channel amps. Just like I used to buy you speakers a new set every three to five months on audio Gone done with that, I haven't had a new set of speakers in three years. It's I was listening last night to O brother and what a genius t bone was is?
They sound great? It makes me very happy.
Okay, Well, in the chain the sound is affected definitively by the speaker. We can talk about everything that comes before that will colors, but every speaker inherently sounds different. Correct, Okay, So what is it about these speakers that, with all the experiences you've had, you finally decide this is the one? All right?
So the most I ever spent on a pair of speakers was sixty thousand dollars. And the cool thing about Audiogon is you can buy a used pair of speakers and sell them for what you pay for them. So I've actually broken even pretty much on all of my speaker adventures. These speakers are baffleous, which means there's no box. You've got the driver, which is a hole in a big sheet of butcher block, and this the front and
the back are both exposed to the outside world. And that means they're super fast because they're not pushing against the compressed air inside the box. And because they're so efficient ninety eight dB efficient, I only have to give them a little tiny bit of power. And the thing about amplification is two bamps of the fifties were better than almost any ant made today, but they couldn't get very loud because they only have a few watts per channel.
So when the transistor came along, the manufacturers loved it because they could give you one hundred two hundred, four hundred wats and it only cost them four bucks. So by going backwards with the tubes, I got the chance to get that sweetness. Maybe it's not completely realistic, but it sounds so nice. So it's the bafflus, it's the high efficiency, it's the quick speed, and it's the fact that I'm in the sweet spot of what the tube can do.
Okay, you built your own speakers, who designed them, who decided on the components, right, So there's only one driver, and there's no crossover, so the tweeter, the woofer, the midrange, they're all one thing. And it's two brothers in China who are audiophiles who decided to use Chinese ability to make things much cheaper than they should be, but to
spend a lot to make these drivers. So the drivers cost six hundred dollars a pair, and if they were made in the US, they would probably cost twenty thousand dollars a pair. So about the six hundred dollars pair of drivers and everything else is just me screwing things together. Okay, so they're full spectrum one driver fuir spectrum. Can I ask how many inches they are across?
Twelve inches?
And I'm looking on my web here to tell you the name of the company because it's been a little while. Aldo, Okay, it's called Lee Song l II, And what you're looking for is, oh, they're down to three hundred and ninety nine dollars. They're the Lie Song fifteen inch full range speaker driver.
And then you decided how large a piece of wood and how to installment or they get tell.
You, no, I built a whole enclosure and I tried different approaches and it's not that hard because there aren't that many choices.
And then what do you use for source?
So I used to have a huge collection of CDs, and then for a while I got into vinyl, but I found I kept coming back to streaming using Rune, which is a piece of software that everybody who loves music should have. Are n And what Rone does is it's the interface between title and cobas as your sources and the streaming box. And it's this beautiful interface that lets you see album art and all about the album.
It's really lovely. It makes listening to music more fun and it also suggests the next song I want to listen to, and it's very smart about that. It's not being used against me because I paid for it. There's no ADS, there's no nobody's getting payola. It just works. And so I've got that thing running next to a box from PS Audio, and the PS audio box is the thing that takes the Ethernet cable and turns it into an analog signal, and then that analog signal goes
to an amp. Now, the thing about the amps. The amps come from a website called hi Fi Shark, which I also strongly recommend everybody. High Fi Shark is where all the people who are into this trade use stuff back and forth with each other, and it collects all of these different sites that have stuff. So you can set a search inside Hi Fi Shark that will send you an email every time one of these things comes up for sale. And so I'm looking now and I
can see Bottlehead makes. There's one there, here's an audio note one that's super fancy, and I like to find the ones that are mostly hand built by hobbyists. But building at two a three am outside of my area of expertise is something that a really good hobbyist has no trouble doing.
And just because you mentioned about the ads, what do you believe about Netflix adding an advertising tier?
Okay, so what Netflix is trying to do now is pick up all the crumbs they might have missed first time around. And what they're going to have to do to make sure they do it in an intelligent way is cripple the ad experience enough that people can afford and want to pay for. Netflix will because they'll always make more money from that than they will from ads, and then get enough people to watch the ad part that they can get enough advertisers who will pay extra.
And this is critical because bottom fishing ads the kind you see on late night TV wreck the viewing experience, which means fewer people watch them, which means that they wreck it further down.
It's a race to the.
Bottom where you want to super Bowl ads, where advertisers pay extra to be in front of a lot of people. So I think Netflix's plan is to keep differentiating so that people like me and maybe you will pay their twenty or thirty bucks a month and then build a big enough audience that you won't see YouTube ads, you'll see super Bowl ads on the rest.
Well, if we you know, basically Netflix blinked after a bad quarter, if we we wound the tape, do you think adding an advertising tier was wise?
Again, I guess it comes down to what kind of company do you want to build? And you know, as we bring this around to this where we started, if you're going to be owned by short term thinkers in the stock market, you have really dumb people as your bosses. And Netflix enjoyed this really significant and rapid rise. They're much better at something like that than I would ever be. But if you want to build a company you're proud of. I don't think you want advertisers, and I don't think
you want short term owners. I think you want to be able to say we are beholden not to advertisers, but to our viewers who are paying us, and we want owners that are going to stick around so that we can build that Because the goal of a company shouldn't be to make as much money as possible for the people who own it today. It should be to do work you're proud of.
And I'm proud of the wisdom you've dropped on us today, Seth. I want to thank you so much for taking this time spending it with my audience.
Bob, you are such a mention. You are a national treasure. And to find someone who I like so much, who thinks so differently from me, what a treat. Thank you for having me. There's a bucket list item.
Well, now you're raising a lot of questions, but that'll be another time in terms of thinking differently in any event, until next time, this is Bob Luff sets