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The War Between Netflix & YouTube: How Podcasting & Content is Being Reshaped with Ian Schwartzman · Earn Your Leisure

• 0:01
  Speaker 1: This episode is brought to you by P and C Bank.
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• 0:42
  Speaker 2: Let's talk about Netflix. Let's get into this conversation. So
• 0:45
  Speaker 2: Netflix shaking up the industry. They just signed Ihearts, some
• 0:51
  Speaker 2: of the iHeart podcasts.
• 0:53
  Speaker 3: Yes, Breakfast Club joined Jada like nineteen shows.
• 0:56
  Speaker 2: So I spoke to Charlamagne yesterday actually about this, Yeah,
• 0:59
  Speaker 2: and he had an interested in take on it.
• 1:02
  Speaker 3: What was his take?
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  Speaker 4: His take was that it's beneficial.
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  Speaker 2: You don't really know exactly how it's going to play out,
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  Speaker 2: but it's beneficial from the standpoint that YouTube has been
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  Speaker 2: taking advantage of creators for a long time and that
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  Speaker 2: there's no alternative to YouTube. Netflix obviously a higher level
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  Speaker 2: of production. So it's is it Traditionally Netflix showed like
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  Speaker 2: you have to even if you're filming a documentary on Netflix,
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  Speaker 2: to my understanding, it has to be done with a
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  Speaker 2: certain level of camera. They're not going to even four K.
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  Speaker 2: So YouTube, you could do anything. You can put anything on.
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  Speaker 3: YouTube, yes, but but okay, so keep going.
• 1:39
  Speaker 2: So so he was just saying that he felt that,
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  Speaker 2: like you said, it wasn't one hundred percent show of
• 1:44
  Speaker 2: like the total outcome, but he just feels like, Okay,
• 1:46
  Speaker 2: you know, Netflix is a it's a situation that could
• 1:51
  Speaker 2: potentially shake up the industry.
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  Speaker 3: And add I agree with add.
• 1:56
  Speaker 2: More options better than having like a monopoly in a
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  Speaker 2: sense as far as just YouTube control and all of
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  Speaker 2: the content. And then I look at it from a
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  Speaker 2: standpoint of like, obviously that's going to come with a
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  Speaker 2: certain level of guarantees as far as money.
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  Speaker 4: Going back to this situation, it also.
• 2:12
  Speaker 2: Some creators might be a little scared and nervous because
• 2:15
  Speaker 2: it's like me personally, I'm gonna be watching a lot
• 2:17
  Speaker 2: less breakfast club content, not because I don't like the
• 2:20
  Speaker 2: breakfast club but I'm not on Netflix that like I'm
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  Speaker 2: on YouTube all day on my phone.
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  Speaker 4: Right, Netflix is something I.
• 2:27
  Speaker 2: Have to actually take time, sit down on my couch
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  Speaker 2: eleven o'clock at night, like the television, and I make
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  Speaker 2: a conscious decision. I've never really watched Netflix on my
• 2:35
  Speaker 2: phone other if I download a documentary on a plane. Right,
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  Speaker 2: But if I'm watching just a random interview, I'm in
• 2:41
  Speaker 2: the spur of the moment.
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  Speaker 4: I just want to listen to it on my car.
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  Speaker 5: You want to hit YouTube, get in, get out.
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  Speaker 2: But Netflix also, I mean, you know, they have shows
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  Speaker 2: that have billion Diddy documentary I was like billions of
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  Speaker 2: streams already in a couple of weeks. So they've pushed
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  Speaker 2: it to their audience too, so they things can go
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  Speaker 2: viral on Netflix as well.
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  Speaker 3: Things do.
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  Speaker 2: Okay, Netflix coming into podcast industry you talked about it
• 3:04
  Speaker 2: is kind of reminiscent of something that happened a couple
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  Speaker 2: of years ago.
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  Speaker 4: So let's have this conversation.
• 3:09
  Speaker 5: Sure, I think Netflix and YouTube were at war. Podcasting
• 3:16
  Speaker 5: changed the habits of listenership and viewership. Netflix and YouTube
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  Speaker 5: we are at war with cable television viewers and podcast
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  Speaker 5: listenership across all DSPs. Vodcasts, which are the video side
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  Speaker 5: of the podcasts, are becoming so relevant and so imperative
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  Speaker 5: to premium platforms that without it, all you have are
• 3:52
  Speaker 5: ten to twelve episode programmatic shows like Ozark, and those
• 3:57
  Speaker 5: take six months two years to make, and then after
• 4:01
  Speaker 5: three days of being out, what are people watching? What
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  Speaker 5: they've realized is what we've been saying for a long time.
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  Speaker 5: We're putting out two episodes a week, three hours each.
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  Speaker 5: We're giving this is just publicly, so the Joe Budden
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  Speaker 5: podcast gives you six hours of free public and then
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  Speaker 5: another six to eight hours paywalled, so we're talking about
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  Speaker 5: between twelve and twenty hours a week.
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  Speaker 3: We own the market share.
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  Speaker 5: Netflix looks now and goes what Spotify did back in
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  Speaker 5: twenty eighteen. Holy shit, we're paying the labels all this
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  Speaker 5: money for the music licenses we have. But what if
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  Speaker 5: we enter the podcast market space and don't have to
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  Speaker 5: pay the labels their share because we're doing original audio
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  Speaker 5: with podcasts.
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  Speaker 4: That means.
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  Speaker 5: We don't have to pay the labels. We can collect
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  Speaker 5: profits every quarter, which means our stockholders will invest more
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  Speaker 5: money because they'll get a bigger differ.
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  Speaker 3: Then I think.
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  Speaker 5: The war is starting not only between YouTube and and Netflix,
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  Speaker 5: but it's YouTube and Netflix trying to figure out how
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  Speaker 5: to take over the most listened to and watch content
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  Speaker 5: in the world, which is podcasting. This goes back to
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  Speaker 5: my vision for what my daughter is going to do
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  Speaker 5: for her first job. They're betting ten years down the
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  Speaker 5: line right now. They don't give a fuck what show.
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  Speaker 5: This is Netflix. They don't care what works and what doesn't.
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  Speaker 5: That's why they're not negotiating with individual shows right now.
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  Speaker 4: Now.
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  Speaker 5: I don't know what your conversation with Charloe Man was,
• 5:41
  Speaker 5: but he didn't negotiate that deal with Netflix, right.
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  Speaker 4: iHeart, it was I Heart.
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  Speaker 6: It was saying iHeart the beneficiary. It was the sweet
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  Speaker 6: of iHeart podcast keyword, it's a sweet. iHeart was approached
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  Speaker 6: by Netflix. And now I'm I'm speculating.
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  Speaker 5: I don't really know if this is how it works,
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  Speaker 5: but I'm using my better judgment. iHeart was approached by Netflix.
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  Speaker 5: Netflix came up with a really beneficial situation for iHeart
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  Speaker 5: to take their vodcasts and put them on a platform
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  Speaker 5: like Netflix, not one at a time, a suite of them,
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  Speaker 5: and we just saw this recently happen with a competitor, Spotify,
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  Speaker 5: Bill Simmons and The Ringer. They announced fourteen of I'm
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  Speaker 5: paraphrasing fourteen of his shows. We're going to be the
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  Speaker 5: first offerings from Spotify to Netflix for their partnership with Netflix.
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  Speaker 5: And my first thought was, didn't they buy The Ringer
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  Speaker 5: from Bill Simmons? So that means Bill Simmons didn't negotiate
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  Speaker 5: with Netflix. I'm sure he's pretty angry right now. I'm
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  Speaker 5: sure Spotify gets all the upside of the Netflix deal.
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  Speaker 5: I'm sure iHeart gets all the upside of the iHeart
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  Speaker 5: situation with all their shows and so what they're doing.
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  Speaker 2: But iHeart doesn't own We talked about this downstairs. Breakfast
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  Speaker 2: club is different because that's the iHeart entity. The individual
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  Speaker 2: shows I don't notice for certain, but I know it.
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  Speaker 3: What shows are you referencing?
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  Speaker 5: Just give me a couple, Joe and Jada, they own
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  Speaker 5: their own show.
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  Speaker 3: They don't, I'm asking. Yeah, So it's it's interesting.
• 7:26
  Speaker 1: Well, you know, I don't know, only because I was
• 7:30
  Speaker 1: on the phone with iHeart yesterday. I was literally tell me,
• 7:33
  Speaker 1: I'm because I'm just expect for so a lot of
• 7:36
  Speaker 1: what's changed is that what you're talking about is a one
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  Speaker 1: hundred percent correct. When podcasting started, it was just the
• 7:41
  Speaker 1: audio experience, and then a lot of shows we had
• 7:45
  Speaker 1: we started with it became a video experience. In the
• 7:48
  Speaker 1: original contracts, there is nothing for the video, right, those
• 7:51
  Speaker 1: are old, old school contracts. So now they've actually started
• 7:54
  Speaker 1: putting language language. This guy's good YouTube rights inside of
• 7:59
  Speaker 1: the lange which of their contract or video rights or
• 8:01
  Speaker 1: video rights. So now if you signed a deal.
• 8:05
  Speaker 5: Like if I'm Joe and Jada in twenty twenty four,
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  Speaker 5: i start my podcast, do you think I don't.
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  Speaker 3: Know who they have a deal with, but they have it, right,
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  Speaker 3: I don't know. Yeah, let's just say they have a
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  Speaker 3: deal with some network.
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  Speaker 5: Do you think that their deal didn't include video rights
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  Speaker 5: in twenty twenty four?
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  Speaker 1: And I'm sure it did, because the language has changed,
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  Speaker 1: even in negotiating contracts, and even with us, like in
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  Speaker 1: our contracts, it was like, what's the matter, No, it's.
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  Speaker 3: Real, these are real conversations.
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  Speaker 1: It was like, look, not something that we're interested in, right,
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  Speaker 1: because we built this independently, right of course, and so
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  Speaker 1: most people don't have a video component of their pocket
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  Speaker 1: today's they do labels know that, labels.
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  Speaker 3: Being the powers of the corporations.
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  Speaker 1: And so now it's in the contract, yes, right, so
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  Speaker 1: they'll throw a little bit more money in it.
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  Speaker 2: And when you say stand it, oh, let's not just yeah,
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  Speaker 2: because we can't do that.
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  Speaker 3: What's the matter You afraid of offending somebody? What can't
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  Speaker 3: we do? What is going on here?
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  Speaker 1: Anyone's contract saying that iHeart and the Spotify's of the
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  Speaker 1: world offering.
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  Speaker 2: Now I'm saying for us, we've never given up any
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  Speaker 2: level of a video at all. So I just said,
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  Speaker 2: but I know that there's other people eighty five South
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  Speaker 2: they never gave up their video.
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  Speaker 1: But so now think about when did they start. They
• 9:19
  Speaker 1: started along a long time exactly. I'm talking about the
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  Speaker 1: new work.
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  Speaker 2: Content people that's coming into the game right now in
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  Speaker 2: the past three or four that they're signing deals off
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  Speaker 2: the rip.
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  Speaker 3: Yes, yes, that's giving up No.
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  Speaker 5: No, no, stop, don't ask the questions. So now we're
• 9:31
  Speaker 5: now we're gonna now we're gonna sound crazy. You're not
• 9:34
  Speaker 5: gonna do this with me. Yes, they are giving up
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  Speaker 5: their video rights.
• 9:38
  Speaker 4: Off the off the risk.
• 9:39
  Speaker 3: Yes, they don't have any yet. No, because they want
• 9:41
  Speaker 3: a bigger check.
• 9:42
  Speaker 1: That's that part too, And they haven't even experienced what
• 9:45
  Speaker 1: it is to be.
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  Speaker 2: But they know that they're gonna. It's not like YouTube
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  Speaker 2: is a secret at this point. They know that video
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  Speaker 2: is a major part. Probably more people might even watch
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  Speaker 2: the video than they listen to the audio.
• 9:55
  Speaker 3: That is a fact. Well who knows it better?
• 9:58
  Speaker 1: They know, like you said, they're looking at it's the
• 10:00
  Speaker 1: same thing that you said earlier. If they offer you
• 10:02
  Speaker 1: one point two and master Pizzo is just thirty years ago,
• 10:05
  Speaker 1: if they offered me one, I must be worth a hundred.
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  Speaker 3: There you go.
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  Speaker 1: They know if they offer you two million or ten
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  Speaker 1: million for your video rights and your audio rights, they
• 10:12
  Speaker 1: know they're gonna make thirty off of it, right.
• 10:14
  Speaker 5: Because no one's investing to get their money back.
• 10:16
  Speaker 3: Right, They're investing to make the profit. There's a margin, earners.
• 10:19
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