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EARNINGS SEASON: AMAZON, ROBLOX, & MORE · The Media Odyssey

• Marion Ranchet: [00:00:00] Hey man. Evan Shapiro: Hey, how are you? Marion Ranchet: I'm good. I'm good. You are back from London, right? Evan Shapiro: Just off a plane from London actually into what is still being renovated apartment here. Marion Ranchet: Yeah. I have to say, my background is neat. Yours is not so neat. It is just this week, right? Evan Shapiro: we'll see how long it lasts. There are people. Constructing and electricians in the other room. So you might hear a bang or two, but I will say I slept in my own bed, in my own apartment for the first time in seven months last night, and it was wonderful. Marion Ranchet: That must feel good. Awesome. Okay, cool. So new week, new episodes. Guys, we're loving this thing. More and more earning season is, in full force. There's a few more coming. We're gonna be doing one next week as well Evan? Let's advertise that, you know quickly, which is exactly same time, same place next Thursday, 5:00 PM CET Evan Shapiro: Yeah. And wherever you're watching this. On LinkedIn, on Substack, on YouTube. We'll be in the same place. Hopefully my place will be more done by [00:01:00] then. And I will say for those of you who are uninitiated, if you're coming through either of our Substacks or our LinkedIns, this is the Media Odyssey Podcast. We're doing it live. That's Marian Ranchet. I am Evan Shapiro, and we are coming to you live for, I think, the fourth time now, or third or fourth time. And we're doing this during earning season to do as live ish as we possibly can, reporting on earnings over the course of every given week. And this week we have a big hassle of earnings to report on with some really big companies in. Particular sectors. Do you wanna jump in? Marion Ranchet: Yeah, absolutely. We're gonna start with the later A and go with Amazon, a small, a tiny American company with a tiny global footprint. So I have to say, I was again, quite excited to have some at last, some numbers about Amazon Prime. So they hadn't given us a number for what, two years now? Evan Shapiro: Yeah. Marion Ranchet: We were at what, 200 million and [00:02:00] they're claiming 315 million. So that was my thing. There's not much else that we know. We still know very little, but at least we know that. And I think that says a lot about how their business is transforming. What was your initial takeaway from the numbers? Evan Shapiro: Let me ask you was there a breakdown of those subscribers with regards to, 'cause they, those are sliced and diced in very many ways. There are people who are just subscribers to video. People who are subscribers to, most subscribers in the US are subscribers to the Prime package, which includes free home delivery and video and some other stuff. But did they break it down any further than just prime subscribers? Marion Ranchet: They used the word viewer. Evan Shapiro: Viewer. Marion Ranchet: yeah. So that's what I read in the earnings call. A few thing. To me, that's anyone who's popped up using Amazon they have a lot of. Evan Shapiro: Yeah. Marion Ranchet: And, but the reason why they're pushing that number, right? And it's interesting that shift to, they've never been super open about subscriber counts. Whether we're talking prime standalone or prime video, the shift to viewers is very [00:03:00] much linked to, the advertising play. And we'll speak to that, right? So it's a way of saying, look at the big scale that we're having. This is not a perfect number. We don't know what is a viewer, what is an active viewer, but it's still good news to see. A bit of an, in an insight into, the scale of Amazon Prime. Evan Shapiro: Yeah I looked I looked I'll admittedly you looked right at the video portion of the report. I was taking the larger enterprise view and specifically at the AI investment in context. Because Meta had announced these huge increases in investment in AI. Microsoft had done the same. Google had done the same, and they had all been treated in different ways based on the context of their overall earnings. In this case, Amazon, their stock is down generally, but not necessarily bigger than the market. But the result their stock and their market capitalization isn't up either. Despite the fact that AWS went up 24%, that the advertising business is really just cooking, [00:04:00] continuing at 20 plus percent growth. You're right that they did talk about Prime a lot and their subscriber growth was absolutely pretty impressive given how expensive their subscription stuff is. And their total revenue was up pretty well. Even their e-commerce, which has been one of the weaker parts of their business, given how large a part of their business it is had a really good quarter, yet their stock is meh. And the whole overall response to Amazon was meh because their not doubling, but raising their AI investment, their infrastructure investment to $200 billion next year. And then you put that in context of net income of only 6% growth. That gives me some concern around this company. I look at Google and their set of metrics across the same thing and their investment in AI, and I say, oh, that all makes sense here. I understand the benefits to a of AI to AWS, but So far, it's not showing up necessarily in the same way for this company. Marion Ranchet: So that's a [00:05:00] record number, right? We've been covering earnings these last few weeks, and this number of the AI investment has kept, growing and growing. So we had the tiny Apple at 15 billion, and then we had what Microsoft over a hundred. Meta was like close to 140. I can't remember exactly. This is 200. This is huge. Think the one thing I will say Evan Shapiro: Growth. It's not the biggest growth, but this is a bit of an AI dick swinging contest. You're absolutely right. And I think there, these companies are being punished in different ways in the market. Some are and some aren't. I don't think necessarily Amazon is handling this investment. I'm not seeing it in the bottom line the way that I might in a Google and even in a Meta at this point. Marion Ranchet: So if you look at their cloud business if you look at this what I understand is that it is actually AWS is almost favored versus Microsoft Azure when it comes to cloud. And so all of that investment, to me, it's paying back on that [00:06:00] side of the equation, perhaps less so than a Google where it transpires across every single vertical. I have to say though, that, potentially AI and e-commerce, as in they were saying that within five to 10 years they will decrease the workforce. Decrease the workforce with the advertising, they're pushing the agenda of AI will make, targeting better buying better, et cetera, et cetera. I'm not sure if I agree with you. One thing that I will say is that you've set at the top of the year that, we were in a bubble. And, but that bubble would burst this year. And I'm gonna say it again. I don't think it's gonna happen this year. I think the market is gonna wait for 2026 and then at the end of 2026, we'll see what happens next year. But it's not gonna happen right away. If you see the amount of money people are spending, I don't think that's the direction of travel. Evan Shapiro: Heard. The market seems to be leaning towards my point of view, which is there's a lot of fear around software and [00:07:00] around AI. In particular, hyperbole. If you looked at the prime number or the viewership numbers in the earnings report, I looked at one specific aspect, which was AI and in this case, there's a big deal with Anthropic at the center of their AI strategy, which is a round trip. The reason why AWS is growing at the rate that it is that it's contractually bound to, based on investments that Amazon is making in the large language platforms model platforms themselves. So they're contractually obligated to get that investment coming back in or that those revenues coming back in through purchases of their cloud and infrastructure business. That's not a sound business model necessarily. And that's why at the center of this, I don't, I look at Google who is buying and selling to themselves, and I don't think Amazon is as good a place, but I will say this, we need to move on, or we're gonna run out of time, so let's go to the next company. Which is> Marion Ranchet: Well, so do we wanna keep doing Oh, alphabetical order then that's taking us to, we got [00:08:00] Roblox, we got Spotify, we got Sony. Which one do you wanna do? Evan Shapiro: Let's do Sony and Roblox at the same time. Is that okay? Marion Ranchet: Yeah, that works. Evan Shapiro: Okay. So in that case we've got this slide which is the state of gaming today, at least from my perspective. So over the last week or two we've had reportings from Microsoft, Roblox, and Sony. Nintendo, sorry. And in each case they have major, these are the four of the largest, if not three of the largest comp, the three largest gaming companies on the face of the earth, right? And in Sony's and Microsoft's case, their gaming divisions in particular had really bad fourth quarters. That's a bad sign for a gaming company. Meanwhile, Roblox, which doesn't sell devices or things like that, had a massive year and a massive fourth quarter. That said, they still lost a shit ton of money. And Nintendo is still riding the high of switch two. The fastest, perhaps the fastest growing console in history. We'll [00:09:00] see. But so far, yes it is. And so I think this is an interesting statement on the state of gaming. When you look at the earnings of these four companies. Marion Ranchet: Yeah. Minus four I thought that was revenue. So it's on sales. The thing is that if you look at PlayStation, they haven't released a device in how long, when was PS 5 launched the last time? Tell us in the comments. If you look at Microsoft, same thing, right? So switch to fantastic code blocks. I think it shows the future, although it's already here because it's platform first, right? It is device agnostic. One thing that I will say with Roblox is that the limitation I see with this company is the fact that it is very web based first, right? Everything is mostly happening on the web. I haven't seen how it works on the web and on mobile. At a moment in time where there's so much focus on TVs, and having that TV experience, I think this company, what they're missing right now that YouTube [00:10:00] has managed to bridge is to make that transformation of being a web and mobile first platform. To be a hundred percent device agnostic. What do you think? Evan Shapiro: Yeah, I think I agree. Yes and everything you just said there, I think the major takeaway here is live gaming is super important. Most of the most profitable gaming is either mobile or live gaming. And in an era where mobile has to be a part of your gaming strategy, has to, it doesn't have to be all of your gaming strategy, but it has to be a good part of it, and it'll probably be more than half of your revenue. Both Roblox and Nintendo are mobile products. Nintendo in a very different way, but we can talk about that in a second. Microsoft and Sony are anchored to products that are anchored to the home. Marion Ranchet: Yeah. Evan Shapiro: And that is proving problematic at this moment in time, that the anchor to the old business, which Sony has done enormously successful and Microsoft has failed at. The Xbox, is a failure. It's a [00:11:00] failure compared to Marion Ranchet: I dunno about that, but yeah. Evan Shapiro: And you, Marion Ranchet: I trust you on that one. Evan Shapiro: Look, when you look at the numbers long term compared to the Nintendo consoles and the Sony consoles, it's not even close. Xbox doesn't come anywhere close. Comparatively speaking, it's always been third place at best, by the way. And then on the second hand, it's now a drag on that business because the Activision acquisition that Microsoft did for, what was it, $70 billion is 75% live gaming. And that's not really a console business. That's a cloud business. That's a subscription business. Sony and Microsoft need to lean into their gaming subscriptions if they're going to transform. Marion Ranchet: Yeah, for sure. Evan Shapiro: For this moment, I think. Marion Ranchet: I completely agree. And on the back of that, 'cause we focus on devices and platform, but last week, Ubisoft, which is a French company but very much a global company announced a billion dollar of losses. They're gonna [00:12:00] be cutting staff, they're closing studios. They've decided to actually cut some existing games, some new projects, some of the existing IP, talking about Prince of Persia, et cetera. And it's a mismatch, right? Because these guys have been investing so much money, but the cycle is so long. And in the meantime, you have platforms like Roblox where people are, creating their own games or, you have traditional players creating games within a matter of weeks and months. And so clearly there's a two, two speeds ecosystem right now. But, so I will say holo needs to be not just mobile first, et cetera, but TV two somehow. I don't know how that can work out given that you are very much in the making of things. It's much more lean forward than most of the gaming experiences with others. But I agree that Sony, Microsoft, and even Nintendo to some point, I have a switch. I'm still not buying games online. I'm not using the subscription. I'm not being [00:13:00] pushed, and I'm not being pushed in the ecosystem. Evan Shapiro: Yeah. Marion Ranchet: It's very old school in the way the business is doing it. And it was fine for a long time 'cause this was a cash cow. But as, as you were saying, the market struggling now. Evan Shapiro: They have a very differentiated model. First of all, they have an incredible library of IP, which makes money in the movies as well as on their consoles. This is Nintendo. Marion Ranchet: Yeah. Evan Shapiro: So they, but they have a very old school model. When they release a console, their year is great. When they don't, their year sucks. Next year, this time we'll be having a very different conversation about Nintendo. I've been tracking them for a long time. Yeah. The other thing to know about roadblocks, two things. One, you're right. That is a creator economy model and as are a lot of the larger live playing. Fortnite is to a certain extent as well, and I'll talk about them in a second, but in particular, Roblox paid out a billion dollars or more to creators in 2025. That said they've never been profitable. They've [00:14:00] never been profitable and I don't know if they ever will be profitable. Lastly, one thing here I have these friends who just did a survey they're called GIQ or not a survey. They do, they had their data company and they focus on gaming, and they gave me a study that showed that 65% of all in-game advertising is generated by Roblox. Marion Ranchet: Wow. Evan Shapiro: It's not that huge market. But in the marketplace of in-game advertising, Roblox is the only one hyper-focused on it right now. And that to me is a, an enormous upside that I don't think anybody other than them is really as focused on. Fortnite is the other largest player. But I think Roblox is one last thing, their audience has also aged up by, as the audience, original audience has aged, they've aged up to a much more 18 to 45-year-old audience than they were. And that's what I think part of that is the advertising business. Marion Ranchet: So that's interesting. 'cause they release data right on. So they are doing something that I like, but as a parent [00:15:00] and I think, let's see if they're not getting punished but, very proper age verification and during those earnings, they actually gave the actual numbers of how, that audience of, we're talking about 144 million daily active users. This is a number that I love. We only get monthly on the streaming side. So I love that they're sharing daily that shows the Abbot, right? So 144 million. And you are looking at, 35% are under 13, then 13 to 17, 38% over 18, 27%. This is still a company that's not Evan Shapiro: That's a huge shift from a couple of years ago. Marion Ranchet: Yeah. Yeah. They yeah, absolutely. So that's one thing they will need to figure out to be sustainable, long-term. Evan Shapiro: Which is? Marion Ranchet: Well in China, I don't think you can play Roblox anymore 'cause they saw that they were spending, too much to set out. So below 13, that is still a lot of, those players. And it could be that actually those are those who are playing the most, maybe under 17, I [00:16:00] would say. Evan Shapiro: So there are a number of problems that this business faced a couple of years ago. Most notably predators on the platform. And a lot of bad things. And then if not predators, inappropriate content, reaching minors all over the world. And it became a major issue for them. Simultaneously, they were freaking out over the fact that their demographic was aging. It seems to me that within the last year, they've decided to lean into the aging of their audience and turn it much more as they should more and they and turn it into a much different, by the way, older people spend more. Marion Ranchet: Yep. Evan Shapiro: And it's good ad business. It's a really good ad. The kids ad business sucks, so they're gonna create two different experiences. One for kids and one for adults. And the kids, one will be, kids stuff. The monetization will be probably pay as you go to a certain extent at some point. But that's, again, we're talking about a different, an evolving ecosphere here that I think Microsoft and Sony aren't necessarily a hundred percent on board yet. I, we will see if Nintendo is a year from now. I also think Nintendo should buy Roblox. [00:17:00] This chart to me says, Hey, Nintendo, go buy Roblox. You belong together. You can't play Roblox on Nintendo Switch right now. That's a mistake. That is an error in both companies judgments. Marion Ranchet: I dunno how you can make a, I mean it's a platform nested in another platform, so it's very much Evan Shapiro: Oh, it's IP machine. Yeah. Roblox is an IP machine. It's a universe builder. Marion Ranchet: Yeah. So a subset of Roblox should be turning, should be minted as IP and be taken on, third party platforms and devices and Evan Shapiro: I think we'll start to see that happen. Anyway, let's go on to our, I think our last company, although we may go on. Marion Ranchet: I have, I have one thing I wanna talk about Sony. Regarding Sony. Evan Shapiro: Okay. Marion Ranchet: And just take a two seconds to look at, 'cause overall it's not a great quarter for these guys. Evan Shapiro: No. Marion Ranchet: And looking at, I wanna ask a question. I wanna ask you a question. What I'm seeing that the movie side of their business is minus 11%. They're saying it's weaker, theatrical, et cetera. I wanna [00:18:00] re-ask the question that you know, these last few years, what we've heard is Sony made the right choice. They decided to stay a content studio and not do D2C like the others. Do we think that this premise still stands? Evan Shapiro: That's a great question, especially in context of all what's happening in the industry right now. I think there were a lot of us, myself included who said that wound up being a great choice. I think it was a little bit more by accident than people give them credit for, but I think this is demonstrating how hit driven the business can be and as one of the only true independents left out there, the Shrunken Market of Independence has created less demand from that sector. And so their business is suffering. Overall wide orders for for television series went down 15% in 2025. Yeah. The only sector that grew in television orders, film and television orders. So both of their [00:19:00] sectors was low to medium high production value, which is not what Sony does. Sony only does big high-end productions, both in reality, nonfiction and in fiction and television film. They are no, a notable studio. They'll probably bounce back from this there. And, their music business on the other hand, which is a much less driven business now, they're actually being driven almost entirely by library at this point. Their music business went up almost 13%. Marion Ranchet: Yep. Evan Shapiro: In 2025. Driven by, I think the next company we can talk about really quickly, Spotify. They the pictures and the television business, they don't really have that great a library business. They have a very hit driven business, especially in the television. Marion Ranchet: Love it. Okay, so let's move on. Evan Shapiro: Last company that we're gonna talk about is Spotify. A company that I used to love to hate. Now I hate to love mostly 'cause I think their CEO's not a very nice person. I'll go on the record and say that or not CEO [00:20:00] anymore, he's now the chairman. But I think the big takeaway on Spotify first of all streaming is now the music business streaming and live performance. Marion Ranchet: Yeah, I was about to say exactly. Evan Shapiro: And for a performer though, pretty much just live 'cause you're not getting paid a lot of money unless you're Taylor Swift from Spotify or Apple or the rest. And the music streaming business has been a very difficult business, a very expensive business to be in. Spotify spent a lot of money on podcasts. I don't know if that really ever paid off. Their music costs go up every single year, and I don't think a lot of people understand that 2024 was the first time they were ever profitable. Marion Ranchet: People know that. People know that. And one of, yeah, one of the reasons why they were not right is 'cause I started my career in the music business. And on every single stream, there's not a lot left, right? There's a lot left. It's not a high margin business. Considering how the deals are structured with the major studios. Evan Shapiro: Yeah. And, but this, they have found a way to lower [00:21:00] costs. Mostly through bloodletting of staff. And they have continued to grow their user base on the paid end especially. And they're getting, they've been raising prices. They didn't see any increase in churn from a, from an increase in price at all. Basically zero drop off of subscribers. And crucially, I think they have the greatest example of what I call the affinity economy. I think they have the greatest piece of social media marketing in history called Wrapped. And this year they amped it up with ages and things and other things like that, and it became the greatest social media. You and I both posted our, I think our wrapped, we emulated it on our feeds. So they, they are crushing it right now on all aspects. The only thing they're not doing well is advertising sales. Marion Ranchet: Yeah. Speaking of Wrapped, do you know that this was the idea of a trainee of an intern. Evan Shapiro: You have told me that before. Yes. Marion Ranchet: Yeah. Who did not get credit for this. Which is quite fascinating. How old were you? I was 21. [00:22:00] This year on my wraps, Evan Shapiro: My, I think it was 71 was my wrapped, which is basically my age. So that's, Marion Ranchet: Yeah I don't understand how they went about this, but 21, given that I'm 46, yes. I'm saying it out loud, it's fine. So one thing I will say about the advertising piece, I do not get it. I don't understand how Evan Shapiro: terrible at it. Yeah, Marion Ranchet: how hard. My question is it because audio advertising is tricky. And it's why they're investing so much in podcasts. And they're saying that in terms of concept, it's been plus 90% on the video podcast. Is it, is this why they're moving and putting so many efforts on video because they just don't know how to monetize audio? But it's not just them, it's more the market itself? Evan Shapiro: I think whoever came up with their video strategy, I'm gonna give them a lot of credit for thinking this way, but the deal with Netflix makes their entire video strategy pay off immediately, right? Yeah. Not many people realize this, but the number one podcasting platform on earth is YouTube. Billion people watch YouTube [00:23:00] on TV for podcasts every month. That's just on TV. So it's about a third between Spotify, Apple, and YouTube. But YouTube leads and then the other two are mostly audio. And the video component has been growing. Spotify got into that business, I think to exactly all your points, but they now have a deal with Netflix, which makes it I think probably break even day one, if not, in the black day one based on, the com. Hopefully Netflix is selling those, that inventory for them. Although Netflix is also not great at selling ads, let's be honest. Marion Ranchet: So not as bad as as Spotify. If you look at the numbers because we're looking at what plus 4% of revenue growth and subscription revenue grew 14%. Evan Shapiro: No, I think Marion Ranchet: anyway, Evan Shapiro: I think Spotify's ad sales was down 4%. Year on, year, quarter. Marion Ranchet: To me it was maybe I looked at the quarter, so could be that year on year. It is, Evan Shapiro: yeah. Fourth quarter on fourth quarter on fourth quarter. Fourth quarter is the best ad sales quarter of [00:24:00] the year. Yeah. Their ad sales was Marion Ranchet: plus 4%. Evan Shapiro: Down 4%. That is a bad story. That said, they're crushing it. They have the least churnable subscription in all media, and that's a major accomplishment. Two things. One, does anybody have any questions? Put them in the chat right now and we'll answer them. We do wanna try to be mindful of everybody's time. And two, as you're putting your questions, for anything we just said, or why my apartment looks like it's just been moved into in the chat. I wanna remind you that Marion and I are both gonna be at Stream TV Europe in Lisbon in April. Lisbon in April is probably the greatest phrase in the history of words, you're gonna wanna be there. The contents gonna be amazing. Marion has a whole day of programming that she's doing. We've got ITV doing a case study on Love Island. We've got ZDF doing their case study on how they went digital. We've got Banijay doing a case study on how they're going to direct to consumer. We've got a case study on Eurovision, the world's first song [00:25:00] contest. There's an early bird. Go ahead Marion. Marion Ranchet: I have one. I am releasing in partnership with RTL Ad Alliance the biggest survey on video behaviors across Europe and it's 18 markets plus we're comparing with the US, China, and Saudi Arabia. This report is coming out pretty much at the same time as Stream TV, and you'll get to have me and someone from RTL Ad Alliance speaking to that because there's the narrative and then there's the numbers. But yeah let's go back to the early birds. Evan Shapiro: First of all, Christine Carr. PS5 was released 2020 November 12th, 2020. There's an early bird special for Stream TV, which ends tomorrow at midnight, and there's a code that gets you an additional 10% SME 10, which is on screen if you're watching and if you're listening to this later, SME 10 Stream TV Europe go sign up now. Thank you for that. Christine. Jo Redfern, Roblox is, said that Roblox is actually mobile first. Which as not a [00:26:00] Roblox player, I don't know that I would've known that. And that's why I think, Marion Ranchet: Web and mobile, but which one is bigger? Mobile, I guess then I'll trust Jo on that. She's a specialist. Evan Shapiro: So Jo's gonna have to give us our answer there. Christine Carr also asked, Marion Ranchet: say 10%. Evan Shapiro: What are your thoughts on the Amazon AWS layoffs coming this year, including this January? I think honestly, that's how Amazon is using AI most right now to reduce staff. They have been doing it ever since they started introducing AI to the to the enterprise. They saved thousands of years of human staff time in recoding their platforms using their own large language model internally there. So I think, that's where they're most applying it, not necessarily as a business product. Marion Ranchet: I love it. We're starting to get people giving us recommendation for Lisbon. Fraser says booking caffeine Lisbon has the best coffee. Okay, we'll go check it out, but you should come. Fraser. I don't know where you are based, you should come spend time with us in Lisbon. Evan Shapiro: And Vanessa Sawyer she [00:27:00] says, Wrapped is so clever. It's taken off with other brands and other platforms. Ripple Effect has been huge. That's true. Vanessa, what was your age? Tell us if you dare. Frazier brief rundown please on Spotify, Netflix deal unless already covered? Marion Ranchet: Yeah we covered it, but what can we say about that deal? You said it, I think Spotify spent a butt load of money and on its own, knowing that it's an audio platform first and foremost, despite the fact that they wanna be more hybrid being on the biggest platform in the world video wise makes the most sense. Evan Shapiro: Yeah, absolutely. I would say I think the heartbeat of that deal was with The Ringer and Bill Simmons his podcast launched already. Your big bet for the year Marion was that podcasts on Netflix would fail if memory served. Yep. True. Marion Ranchet: Absolutely. And I said that again recently, yeah, with people with Netflix people in the room. Evan Shapiro: You did say that. Marion Ranchet: I stand by this. I stand by this. We'll, see. I no, it's a gut feel in the sense that I don't think it works too. Two things. Number one, I [00:28:00] think the type of deal they're making is very 2016, if not 1996, because it's this exclusivity thing where, you know, because they're on Netflix, they can't be on YouTube. So I think this is a lose, lose deal long term. I don't like that. I think it's very shortsighted. So that's one. So I think that's gonna hurt those those podcasts. Number two let's see how the product evolves. But right now the Netflix product is really nuts. Built for appointment TV and regular reviewing like this. And we tend to binge watch stuff. And I, I watch and listen to podcasts and it's that's not how I do it. But again, it's just me. Let's see. Know your time because you, I'm okay being wrong. Evan Shapiro: I'm okay being wrong. Just not in front of other people. Marion Ranchet: Yeah, exactly. Evan Shapiro: But I will say Howard Stern I think proves your model incorrect to a certain extent. He just renewed for what his 25th deal with SiriusXM, and I think both of them would argue that it's been very successful for them over time. A bunch of others have done similar type deals that have been very [00:29:00] lucrative for them, and they've been very happy about it, whether or not from an audience standpoint, it, it accrues to them over time. We'll see. But I will be interested to see, to me it's obvious Netflix has to have more daily touch points. They have to have more weekly touch points, and then you look out the deal that they made in your Motherland France with TF1. That's all about that. No? Marion Ranchet: Yeah, absolutely. It's one of the, one of the draws that TF1 brings its, broadcast TV channel. So you'll have linear feeds within Netflix, France, and they have a very deep library of content. We're talking 30k assets. Assets, and it's a mix. It's not just French content people, don't you worry. But there's a lot of, great stuff in there. And it's a way of, I, I'm not sure what's the deal in the background, but it's a great way to have local content. Evan Shapiro: But with TF1 Marion Ranchet: With limited investments. Evan Shapiro: TF1, you get talk shows. Tremendous amount of news programming as well, Marion Ranchet: Soaps. Evan Shapiro: And in this case, I [00:30:00] think that what you have to realize that for a lot of the world watching a podcast on television has replaced the talk show has replaced daytime television. New York Times did a great piece about three weeks ago about how YouTube has replaced daytime TV, and that's what Netflix is. Netflix is chasing YouTube so badly it's little embarrassing, but they're hiring Ms. Rachel, Sidemen, all the podcast, all the YouTubers that they get. The Spotify deal is about that for them trying to steal the podcasting crown from YouTube, and so the definition of premium television, especially when it comes to things like talk shows or news. In part because of COVID, the bar of production quality has lowered and Bill Simmons in the United States, he's not as notable in your territory as he is here. He's a notable personality here and for a certain consumer. I don't think it's about subscription. I don't even think it's about retention. I think it's about ad impressions for both companies. Marion Ranchet: But I think in [00:31:00] any case, the product needs to change you mentioned our Stern and Sirius. Sirius is a, it's an audio platform, turning video the other way around, making sure that you have the right product, the right platform, where people tend to come in and watch two, three episode at once or a movie in one go, having them build that habit of turning it on, just like daytime, they would with daytime TV. I think there's a lot of work to be done on that and yes the content will be important, but then it's also a matter of discoverability and right now, so I haven't seen podcasts here, popping up in any shape or form. But as we have a content discovery problem. So it's great to add all of those new things, but if you are not adapting the product and the platform. Evan Shapiro: Yeah. Yeah. Marion Ranchet: What is it gonna do to your business? Not much. Netflix should do one thing that I'm sure YouTube is doing. Doing what if Netflix they should do this One thing that YouTube is doing. If you look at the Netflix interface, it is pretty much the same [00:32:00] across the entire deck. If you wanna look like TV, then you need to think in day parts. And so your platform should be showcasing different things at different moments of the day. I will share in the comments somehow. I've read a study from Roku and the show how the day is split and what people are interested in. It is FAST focus but I think this would apply for a number of things. And so that's what Netflix doesn't do. It is the same look and feel and content being pushed at any point in time during the day. Evan Shapiro: Yeah. I think your comment about the product is absolutely correct and I think you're gonna see a dramatic shift in product and all the major premium streaming products. I think you're gonna see a massive shift over the next 24 months. All of them are adding mobile or vertical product. Every single one of them is gonna add a vertical product that's gonna have to change the entire operational aspect. If you expect that you're gonna grow to 25% mobile usage, vertical usage, over the next five years, you have to dramatically shift your product. Both content [00:33:00] wise and then obviously technologically speaking. But then to turn this around for a second, I think everybody admits now that podcast, video podcasting is gonna be a major part of the living room experience. Video experience, both vertical and horizontal by the way. This is this deal between Spotify and Netflix says to me that, that they admit that they're not gonna do television, and they're gonna basically outsource that to Netflix for a fee for the IP license. And by the way, this is also Netflix admitting we can't do podcasts. We've tried and we don't want to do it. And it's a nice meeting in the middle. I think they should buy each other. That's a great, Marion Ranchet: You end up buying, Evan Shapiro: but Marion Ranchet: that's a, I thought you said Netflix, Disney should buy Spotify. No. Did you? Oh, no. No. It was, you didn't have something like this. Evan Shapiro: That was a while ago. Marion Ranchet: Yeah. Evan Shapiro: But if Netflix took its focus off of buying Disco Brothers for a second and focused on buying Spotify for about the same price, by the way, or ish, they would have a much more [00:34:00] complimentary product that extends the lifeblood of every subscriber and increases their ARPU day fucking one, it's a, it's an additive. It's a zero turn business almost overnight. Whereas adding HBO Max does, I don't think it gives you anything more than a lot of debt, a shit ton of debt, and a ton of headaches. Marion Ranchet: I don't see this Netflix and Spotify thing, and about Netflix. I haven't seen them doing podcasts. I think what I'm thinking is they're spending time doing licensing deals. They will learn and then they will do what they've done is that they're gonna be able to do it themselves. And I will buy the Netflix podcast venture when they actually build a flywheel around their IPs. I think I, I trust them more on, on doing that than on just, yeah. Anyway, we'll see. We'll see in a year's time, but that was awesome. Evan Shapiro: To your point, you, they definitely need to update that product. If they wanna become a daily touchpoint. If they wanna become TV, they're gonna really have to update that product. Marion Ranchet: They don't wanna be TV, but they have to be TV Evan Shapiro: And [00:35:00] mobile now too. Marion Ranchet: Yeah, Evan Shapiro: this was great. Thank you for doing this once again. Stream TV Europe, we're both gonna be there. We're gonna be doing one of these live on stage with some kick ass guests, which will go out afterwards. Stream tv, Europe, look it up online. SME 10. Is that it? Marion Ranchet: Yeah. Yeah. Evan Shapiro: Is the code. Marion Ranchet: That's my code. Streaming made easy 10. Evan Shapiro: And thank you all for watching on whatever platform you're on. We love you on Substack, LinkedIn, YouTube. We're gonna be back in this place again next week. 11 Eastern, 8:00 AM Pacific, 4:00 PM GMT uk. Yes. Thanks everybody. Cheers. Marion Ranchet: Cheers.