Latest / What the Flux / Labor backflips on tax reform | ARN buys peace with Kyle Sandilands | Snap’s big AR glasses gamble

Transcript

Labor backflips on tax reform | ARN buys peace with Kyle Sandilands | Snap’s big AR glasses gamble · What the Flux

• 0:05
  Speaker 1: This is what the flucks.
• 0:06
  Speaker 2: I'm Justin and I'm Larissa, and it's Friday, the nineteenth
• 0:09
  Speaker 2: of June.
• 0:10
  Speaker 1: Welcome Larisa. Thankxham Brussa has been on the Flux scene
• 0:12
  Speaker 1: behind the scenes, building podcast stories and newsletters, so it's
• 0:16
  Speaker 1: finally great to get you in front of the mic.
• 0:18
  Speaker 2: Thank you for having me take it away, Larisa UDEs,
• 0:20
  Speaker 2: Australia's energy watchdog, wants to make paying for your power
• 0:23
  Speaker 2: bill as easy as paying for milk. The Australian Energy
• 0:26
  Speaker 2: Market Commission thinks that energy bills are too hard to
• 0:29
  Speaker 2: understand right now, and they compared this future state of
• 0:32
  Speaker 2: power bills to buying milk. They said, you don't get
• 0:35
  Speaker 2: separate bills for the cow, the carton and the transport.
• 0:38
  Speaker 2: You get one simple shelf.
• 0:39
  Speaker 1: Price seems a little bit different, but I like where
• 0:42
  Speaker 1: their heads at now Foxham, it's Friday, which means we
• 0:45
  Speaker 1: are playing quick Sticks. If you want to win fifty
• 0:47
  Speaker 1: bucks today to start your weekend up on a high,
• 0:49
  Speaker 1: make sure you download the Flux app, turn on your notifications,
• 0:51
  Speaker 1: and make sure you're the first person to answer three
• 0:53
  Speaker 1: business or finance questions correctly. Now, Larusa, we have three
• 0:57
  Speaker 1: very exciting stories today, let's do it our First, the
• 1:01
  Speaker 1: Labor government has done a major backflip on its capital
• 1:04
  Speaker 1: gains tax changes while also dumping its stealth debt tax.
• 1:08
  Speaker 2: Nothing like a backflip from panicked politicians. Does what's going
• 1:11
  Speaker 2: on here?
• 1:12
  Speaker 1: Okay? So, as you know, the federal government handed down
• 1:14
  Speaker 1: its budget just five weeks.
• 1:16
  Speaker 2: Ago, and in this budget, the government promised to make
• 1:18
  Speaker 2: changes that would deliver into generational equity.
• 1:21
  Speaker 1: That included the biggest changes to capital gains tax and
• 1:24
  Speaker 1: negative gearing in over two decades. And under the original
• 1:27
  Speaker 1: budget plan, the fifty percent capital gains tax discount would
• 1:30
  Speaker 1: be replaced by inflation indexation for all asset sales.
• 1:34
  Speaker 2: And we're not just talking about property and vistas.
• 1:37
  Speaker 1: It also included individual share and crypto investors, business owners,
• 1:40
  Speaker 1: and anyone selling through a trust.
• 1:42
  Speaker 2: But now the government has done some pretty major backflips.
• 1:45
  Speaker 1: First, the small business capital gains Tax active asset reduction threshold. Wow,
• 1:49
  Speaker 1: that's a mouthful. That has been expanded from two million
• 1:52
  Speaker 1: dollars to ten million dollars in turnover.
• 1:54
  Speaker 2: Meaning many small businesses can still claim the fifty percent
• 1:58
  Speaker 2: capital gains tax reduction.
• 2:00
  Speaker 1: I've also announced a new tax concession for equity in
• 2:02
  Speaker 1: private startups.
• 2:03
  Speaker 2: And backflip number two. Trusts used for genuine inheritance purposes
• 2:07
  Speaker 2: will now be exempt from the proposed thirty percent minimum
• 2:11
  Speaker 2: tax Larisa.
• 2:12
  Speaker 1: The CGT discount will still be scrapped for share market investors.
• 2:16
  Speaker 2: So while business owners have some carve outs, critics say
• 2:19
  Speaker 2: that the government is still taxing the very investments that
• 2:22
  Speaker 2: help drive economic growth.
• 2:23
  Speaker 1: So what is the key learning here?
• 2:25
  Speaker 2: When economists talk about capital, they generally split it into
• 2:28
  Speaker 2: two bucket passive assets and productive capital.
• 2:31
  Speaker 1: Passive assets are things like land or established property.
• 2:35
  Speaker 2: They appreciate over time but don't inherently create something.
• 2:38
  Speaker 1: New, whereas productive capital is money that's invested into businesses,
• 2:42
  Speaker 1: into startups and other productive ventures.
• 2:44
  Speaker 2: These are the kind of investments that create jobs, built industries,
• 2:48
  Speaker 2: grow the economy.
• 2:49
  Speaker 1: And Larissa. The difference in the asset use is exactly
• 2:52
  Speaker 1: why governments around the world have historically offered CGT concessions.
• 2:56
  Speaker 2: To compensate investors for taking on genuine risk.
• 3:00
  Speaker 1: Despite these carveouts for businesses, it's clear that these major
• 3:03
  Speaker 1: changes have made almost all capital investments less attractive. For
• 3:07
  Speaker 1: our second story, AARN media are forking out twelve million
• 3:10
  Speaker 1: dollars get Kyl Sandalans off their airwaves, but they'll pocket
• 3:14
  Speaker 1: some of his future earnings in the process.
• 3:16
  Speaker 2: Nothing shocks me anymore when it comes to Australia's biggest
• 3:19
  Speaker 2: shock jock. What's going on here?
• 3:21
  Speaker 1: Okay? So AARN Media is the media company that owns
• 3:24
  Speaker 1: Kiss and Gold and home to fifty eight radio stations
• 3:27
  Speaker 1: across Australia.
• 3:28
  Speaker 2: Let me remind youzz Back in twenty twenty three, Kyle
• 3:31
  Speaker 2: and Jackio signed a two hundred million dollar contract extending
• 3:35
  Speaker 2: their show into twenty thirty four.
• 3:36
  Speaker 1: Then in February this year, and on air fight between
• 3:39
  Speaker 1: Kyle and JACKIEO led to Jackio walking out and AARN
• 3:42
  Speaker 1: sacking them both.
• 3:43
  Speaker 2: So does. Two lawsuits landed on Aaron's disc and each
• 3:47
  Speaker 2: one was worth more than eighty million.
• 3:49
  Speaker 1: Which together is bigger than Aaron's entire market cap of
• 3:52
  Speaker 1: one hundred and twenty three million dollars.
• 3:54
  Speaker 2: So now aar Instead, They've resolved the lawsuit with Kyle
• 3:57
  Speaker 2: Sandalans by paying him around twelve million in cash to
• 4:01
  Speaker 2: settle his lawsuit. But here's the thing. As part of
• 4:04
  Speaker 2: the deal, they'll also take around twenty percent of his
• 4:06
  Speaker 2: podcast revenue for the next three years. So what's the
• 4:10
  Speaker 2: key learning here?
• 4:10
  Speaker 1: A revenue sharing agreement is basically a deal where instead
• 4:13
  Speaker 1: of paying someone once, you give them a cut of
• 4:15
  Speaker 1: your ongoing earnings.
• 4:16
  Speaker 2: An Arn's case, that nineteen point nine percent of everything
• 4:20
  Speaker 2: Kyle sand Lands makes from his new media venture.
• 4:23
  Speaker 1: So they're paying him twelve million dollars to leave and
• 4:25
  Speaker 1: then taking a slice of what he lands next.
• 4:27
  Speaker 2: And it's actually pretty common in the media and entertainment industry.
• 4:31
  Speaker 1: Hey go on.
• 4:31
  Speaker 2: Spotify doesn't pay artists a salary, they take a cut
• 4:35
  Speaker 2: of every stream.
• 4:36
  Speaker 1: YouTube doesn't pay creator as a flat fee. They share
• 4:38
  Speaker 1: a percentage of whatever their ads make.
• 4:40
  Speaker 2: The more views, the more streams, the more subscriptions, the
• 4:43
  Speaker 2: bigger everyone's check.
• 4:45
  Speaker 1: But revenue sharing cuts both ways. Yeap.
• 4:47
  Speaker 2: If Kyle's podcast venture flops, so does Arn's cut. And
• 4:51
  Speaker 2: Arn's share price lipped thirty one percent after the news
• 4:54
  Speaker 2: of the settlement, so it might just pay off.
• 4:57
  Speaker 1: For our third and final story, Snapchat stock plunged around
• 5:00
  Speaker 1: nine percent after releasing a pricey pair of augmented reality
• 5:04
  Speaker 1: glasses called specs Snaps.
• 5:06
  Speaker 2: Users not so keen to snap up this fix. It's
• 5:09
  Speaker 2: a tongue twister, tell me more.
• 5:11
  Speaker 1: Okay, So Snap is the parent company of Snapchat, the
• 5:13
  Speaker 1: social media app founded in twenty eleven.
• 5:15
  Speaker 2: Which became popular for its famous dog filter and the
• 5:19
  Speaker 2: disappearing image messages.
• 5:20
  Speaker 1: And it's now got just under one billion monthly users,
• 5:23
  Speaker 1: mostly age between eighteen and twenty four.
• 5:26
  Speaker 2: But Snap isn't just a social media company. It actually
• 5:29
  Speaker 2: unveiled a pair of smart glasses called Spectacles back in
• 5:32
  Speaker 2: twenty sixteen.
• 5:34
  Speaker 1: I remember they flopped hard.
• 5:36
  Speaker 2: The glasses lost Snap forty million USD during the year
• 5:39
  Speaker 2: they were launched.
• 5:40
  Speaker 1: And now Snap's trying again a decade later, introducing new
• 5:44
  Speaker 1: augmented reality glasses called specs.
• 5:46
  Speaker 2: And what will these do well?
• 5:48
  Speaker 1: Essentially, the digital information gets laid over what you're actually
• 5:51
  Speaker 1: seeing in the real world.
• 5:52
  Speaker 2: So the idea is you can do most things you
• 5:54
  Speaker 2: would do on your phone without even looking at your phone.
• 5:57
  Speaker 1: Okay, let's cut to the chase. How much were we
• 5:58
  Speaker 1: talking for these glasses? Cheap?
• 6:00
  Speaker 2: The glasses cost around two two hundred USD, which is
• 6:04
  Speaker 2: more than a return.
• 6:04
  Speaker 1: Flight to Europe.
• 6:05
  Speaker 2: But beating on AAR hasn't historically been the smartest.
• 6:08
  Speaker 1: Business man I know, So what is the key learning here.
• 6:11
  Speaker 2: AR glasses have been the nixt big thing for over
• 6:13
  Speaker 2: a decade, but they still haven't really taken off.
• 6:16
  Speaker 1: Google tried in twenty thirteen with Google Glass, Microsoft tried
• 6:19
  Speaker 1: in twenty sixteen, and Meter and Snap have been dabbling
• 6:21
  Speaker 1: in AR for over a decade.
• 6:23
  Speaker 2: But with more subtle AR glasses and more capability. We've
• 6:26
  Speaker 2: seen the AR glasses market hit one point six billion
• 6:29
  Speaker 2: and twenty twenty five and.
• 6:30
  Speaker 1: Has forecast hit four billion by twenty thirty, but.
• 6:33
  Speaker 2: There isn't really any company that has cracked the smart
• 6:36
  Speaker 2: glasses market yet, and if AAR eventually does go as
• 6:39
  Speaker 2: mainstream as the smartphone, being the go to smart glasses
• 6:43
  Speaker 2: brand could make you a very valuable tip company.
• 6:46
  Speaker 1: Chris, great to have you on the pod. We're going
• 6:47
  Speaker 1: to have to bring you back many more times, I hope,
• 6:49
  Speaker 1: So thanks for listening and we'll see you on Monday.