AI-powered search engines have clawed a foothold in the critical search market that controls distribution on the open web. Media management consuling firm Activate estimates 15 million people are using these answer engines rather than Google, which is adding AI summarization to its results. By 2028, Activate expects that to rise to 36 million. The open question is whether publishers can stem this tide.

Michael Wolf, the CEO of Activate, sees a fundamental shift in the search market, as generative AI can currently handle about 40% of searches as an open web discovery tool. He expects the rest of searches will follow suit over the next five years as the fundamental nature of the open web changes. This will lead to search becoming the front end to what Wolf calls "gated web discovery" and eventually "discovery-led transactions."

Welcome to The Rebooting Show.

I'm Brian Morrissey.

I'm very excited to be joined by Michael Wolf the ceo of Activate Management Consulting firm That is very prominent in I guess what it would be called the TMT space, but technology, media, telecom we see is today, but basically what, you know, we were talking beforehand about what I consider, you know, the information space and the content space, because, it is no longer just about media companies, media companies that are smaller part of this space.

If you will, Michael, welcome.

Yeah.

it's interesting because the core media companies, in some cases they're thriving in some cases they're not.

But what's interesting is you see so many people who are somewhere else in tech or retail or other places that want to be in the media business.

Let's not forget that the great majority of the internet and is funded by advertising.

You see, retailers.

Now our media companies and so we, we calculate that this year the major retailers are going to sell about, about 50 billion worth of advertising.

And, and we see that going up to about a hundred billion in the, in the next years.

And so, and they're like Walmart, Amazon, Target.

So many of them are now selling ads on their sites.

And what's really fascinating

And they have closed loop attribution.

They've got buying data and, and it's pure margin for them.

It ain't their business.

Yeah.

You know, what's fascinating.

If you step back, the, the paradox of privacy with the big, big companies is that they're saying in the name of privacy, they're eliminating things like cookies and other and letting people opt out, but that brings more power to them.

Less privacy.

It puts, puts all people's data in their hands.

But coming back to this issue about media.

So we, we do have the retailers, the retailers are now buying their way into connected television, CTV.

You already have Amazon doing so with fire stick.

You have Walmart, which bought Vizio.

Most people thought the reason why they're buying Vizio is because they're vertically integrating because they sell so many, so many screens.

But in reality, part of it is, is being able to track what their customers are doing and having combined that with the data that they have.

And you see other companies, you see companies outside the U.

S., Rakuten, Mercado, and we're gonna, we're gonna see this continue.

yeah.

So my, my core question I want to, is media still a good business?

New York magazine just had this, this, this big like package.

And it, it was mostly focused on what I consider the sort of traditional media space, right.

Of, of publishers and broadcast companies.

And it's you get them in a room and it's woe is me.

It'll make you like really depressed.

Right.

But the, you know, I go through your report and this is a thriving, growing space.

It's just different now than like five years ago.

Yeah.

I mean, these, all of these people, they, it's not as if they just woke up and find that the world is different.

They have, they've had lots of time and some of the companies have done a great job of starting to move into, into some of the other businesses that the, the most obvious one that of course is streaming, but broader licensing, all sorts of, of other areas.

And like the, the traditional digital publishers that were text and editorial are now in video.

So, so we're seeing that, but I mean, the industry, then to a large extent, there are parts of the industry that are, that are thriving.

There are parts that are not the parts that the, the number of the cable programmers and cable television is enormously profitable business, but all of those cable programmers are going to have to manage down to a world.

Where they have 50 million subscribers in the U S today.

We, we show that they're roughly 70 million cable households.

The it's going to go down to 50 million and we're going to have about 60 million people in the U S which we call with a little smile on our face, battleground households.

Because those are the people they have broadband, but no pay TV.

And that's who everyone's going to be fighting for.

Yeah, I saw that.

I mean, just a quick note because I wanted to get to that, but like, when, to talk about the, the differences, when you talk about it going, you know, to 50 million, that's also virtual pay TV.

Right?

Like, because YouTube is the new, is the new cable, provider, because you, you see that it, by, I think it's 2028, it's going to be basically the majority of virtual TV, right?

Yes.

It, it, it, virtual TV is still not picking up.

So the, the virtual providers, it's, it's not just YouTube TV.

it's of course, Hulu and, and, and there are a couple of others sling, but.

those are not, they're really not offsetting the declines in cable.

If anything, they're, they're just making it easier for people to get to their signal.

And, and here's one thing that's fascinating about it.

There are a lot of people, and we've seen this in our research every year.

There are a lot of people who continue to scrap, to subscribe to cable television.

And at the same time, Are subscribing to virtual cable?

I think they're just confused.

No, no, I don't.

I don't think so.

I think that part of what it is is, and we've, we've gone out and done the research.

Part of it is, is they, they believe that there are things that they can get on virtual cable.

They also want to be able to access it elsewhere.

And the, this, the individual networks have done a bad job of creating their, their, what is called TVE, services that they've been around

The TV everywhere.

Oh my god, they've been talking about that for 15 years.

I keep getting older, they keep talking about the same thing.

Doesn't

but there are people who, and there are people who want other, they want Fubo, they want other things that are other types of services and programming that they can't get so easily on, on cable TV.

but also if you just look at like the channel guide, think about like how long these companies have had to fix this.

Right.

And the reality is, to me, like a lot of media is just downstream of the tech because tech controls the interface.

They're really good at it.

Okay.

They're really and they're going to control distribution.

And that is the commanding heights.

So, Thank you.

You know, too bad.

So sad for a lot of the traditional media companies that are downstream of that.

But isn't that inevitable that they would be disadvantaged?

I think that, part of, part of the challenge for them is these are companies that, that are publicly traded, they, they enjoyed very high multiples before.

And even though they saw in, in different places, of course, the decline of cable television, which drove the valuations of all of these companies, they did see it near insight, but, but in some ways they've been, they've had to balance the need to, to really grow for their future.

And at the same time, deliver cashflow.

And in some cases, Deliver cash flow that can pay off huge amounts of debt that they've taken on.

Yeah.

one of the things that I noticed, from the big picture takeaways was, I started to wonder if we're at the upper bands of where we can time spent with media, right?

I think you had it like a 13 hours.

Right.

And, but it's it's only growing nine minutes.

Right.

And then like, look, it's, it's a massive market.

Right.

So you know, when you back out nine minutes extra every year, yeah, that's 10 billion or something.

So it's, it's not like, you know, peanuts, but at the same time, we only have so much time, people have only so much time.

until the A.

I.

Does everything for us.

we're gonna have to, like, not be consuming media at all times.

So are we reaching, peak media?

I don't think so.

I think that what happened in the pandemic, one of the things that we show is that during the pandemic, that we, before the pandemic and the way we've measured them, we've been doing this for a decade.

We, on average, calculated the average American was spending 12 hours and 24 minutes consuming technology and media.

That's That it jumped up to 13 hours and 11 minutes, and it's largely been sustained.

And we're forecasting that there's going to be, there's going to be more growth ahead, but we're also at the same time, we're, there's an average, there are people who might spend 30, 40 hours a week in video games, or the average amount of time that people are watching video average is five hours.

But we know that there are people who come home and on a weekend and plop themselves down on the front of the TV set and they're watching every game.

So these are averages and there are people who, who are super consumers.

They're, they're spending 18 hours a day watching

me.

I saw the super consumers, you call them super consumers, I was like,

is this the extremely online people super users?

it's basically almost every waking hour and they're not sleeping that much on this

So, yeah, so, they're spending every waking hour.

They're, they're spending time with everything.

They're going to more events, they're playing games, they're listening to podcasts, it's, it's overall, these we're seeing, this is, this is.

This is a consistent theme and it's been going on for the longest time that we've been creating our technology and media report each year.

And our work is based on huge amount of consumer analysis and it's triangular and it just shows this is what people are doing.

So I want to drill down on a few specific areas, but before that, just give me, give, give me like, give me three winners in the current, you know, when you're going up to 2028, like what are like three areas that, are poised for strong growth?

between now and 2020.

so a couple things.

I think that we, we have the largest streaming services are at scale.

And, and so we of course are going to see growth there.

The.

And that's going to continue and people are going to continue to subscribe to more services.

We still forecast that people are going to either watch or subscribe to six services, six streaming services a year.

Now they're going to churn through them.

So that's one winner.

Fascinating.

Free is also winning.

So we see Roku, I'm sorry, we see Tubi, the Roku channel.

Tubi, I, I can't believe I would have never bet on Tubi.

Like I, maybe that's me.

Like a few years ago, I'm like, Tubi, really?

What did Tubi do right?

yeah, I mean, well, part of it is, is part of what happened is, what happened is Fox bought it.

And so Fox could put the weight of their entire company, their ad sales force, their ability, not just to put their programming in, but to promote it, to run ads.

it was a very, very smart deal.

So free, if you wanted to be somewhere, it's going to be, in terms of the free services, it's going to be those three I just mentioned.

Yeah, and, and it should say like ads, ads have, I mean, ads never count ads out, they are the cockroaches, they will always find a way, because like, when streaming started, I remember it was like, oh, well, only poor people will see ads, nobody's gonna, I pay to get rid of the ads, and guess what?

Guess where, guess where the strongest growth is?

In ad supported services.

but, but see, but you're so right.

And there's even more here, which is that all of the streaming services are going to lower priced ad supported tiers.

And people look at it and say, okay, they're, they're raising their prices and for their best subscribers, and they're lowering their prices, they get more subscribers.

Here's what's fascinating.

When those lower price tiers with advertising, they're much more profitable on a specific subscriber basis.

So to your point, don't count out ads.

They were all in, they're all denied.

I mean, Netflix for, for years denied it was going to get into advertising.

But for Netflix, for Disney, for any of those services, the ad supported piece of it is advertising.

is very, very important.

And we already see Amazon.

and you can make more money too.

I mean, like incentives drive a lot of the market, right?

I mean, so, I mean, having a lot of these services found that a, that their ad supported tiers, can actually be better than, than their paid tiers.

Yeah.

I mean, what I meant just now is that they're making more money on an average subscriber who's ad supported versus one that's just paying.

And by the way, the other thing that's happening is they keep those subscribers longer because One of the challenges for all of these streaming services, really, probably Netflix is not included, is customer acquisition, customer retention.

So, there are, Apple is taking the 30 percent keyboard tax or, or, or phone tax for you to, you to subscribe to one of those services.

Amazon, which sells more of these services than anybody else, is taking as much as 40 percent in the first year.

I mean, this is like you open a pizza parlor, and some guy shows up and says, I'm not gonna pay for the pizza, the sauce, the staff, or the cheese, but you're gonna give me 30 percent of all your revenue for a year.

So, that's been a challenge, and those

Sounds like a great business to be honest with you.

well, it's, it's, look, it's, people, people always ask me who's winning and in this, and I always say Apple and Amazon.

They said, what do you mean?

And said like they're, they're, they're able to get the money, but other people are selling.

Let's not, let's be clear.

Verizon is selling streaming services.

There are lots of others who are going to sell as well as direct.

right.

But I get the sense from, from the support that, that consolidation is absolutely coming, in this, in this area.

They don't, so there's two things that they don't have a choice about.

They say, we're spending less on programming, but all you have to do is look at the number of hours of any of these services have versus Amazon Prime.

And so in a lot of cases, people are indifferent to the library programming that they're watching.

They just want to have it available.

They want more of a, a passive experience.

And, and, and I think that, that, that in addition to that, you've, you've got a moment where there are many of these streaming services that need to be larger, need more distribution, because they're not going to pay their way into it.

So if you ask me to guess who's, who's going to merge with who, I'm not sure that the, the sort of accepted wisdom is correct.

People talk about, the, a merger of paramount plus with.

Whether it's max or with, with peacock, I'm just not sure who ends up because it's not clear that we got, somebody has to figure out what's the benefits.

I mean, this is one of the things that people come to us about, which is looking at if we put two businesses together, what's the benefit, how much synergies are really,

Yeah.

But I mean, Netflix is as escape velocity in this, in this category, right?

it is, but, but there's lots of room for others.

And especially in a, in a, in a moment where people can produce, great original programming.

and I guess somewhat unsurprising, but it's it's good to put figures against the traditional TV will continue to erode.

I think you added to like time spent going from two hours, 39 minutes in 2022 to one hour and 41 minute in 2028.

and pay TV households eroding 6%.

yeah, I, but also what that doesn't capture, Is the fact that people are watching television in different ways.

They're watching on a time shifted basis.

a lot of the move to digital includes, the, the long form shows that they're watching on, on YouTube.

and we're, we're, by the way, the media companies make money.

If you look at the news category on YouTube, you see the largest news organization that is really on YouTube is, is not CNN, it's, it's, it's NBC News, and it's followed by Fox News, because there are a lot of people who get their news there, but there are a lot of people who get other stuff, there are people, there, there's a much younger audience, you would say they're not watching TV, but they're going on YouTube and they're stringing together the Jimmy Fallon's monologue.

Because they want to watch it, but they just don't want to watch it on TV.

is TikTok a competitor here?

Is that a replacement?

I mean, how do you think of these categories?

Cause they've completely, they've completely blurred.

I mean, you have, you have a great part in here about, about multitasking.

And, I think it's hard to like truly understand, whereas there used to be these, I think it's the story of media.

There used to be lines between these, these areas and those lines are all blurry or completely erased.

Yeah, there, there are a number of activities that, that we call ambient and probably the one that's the most important is, is audio.

So whether it's, it's podcasts, it's, it's recorded books or it's, or it's music.

And so people, 22 percent of all time is spent now with.

mainly music, but with the other forms of audio also.

So you can do a lot of other things.

You can drive a car, you can, you can run whatever you want to do.

You're that audio is, is definitely a multitask behavior.

but the, the activity, there are activities that are not easily multitask.

And so PC and console video games, people have to be focused.

when you look at, at TikTok and mobile games, they're definitely, they're like little stolen moments during the day.

So TikTok on average is 51 minutes a day.

the average user of attention.

So that means somebody somewhere is, is getting little bites and they're not doing it all in one session.

They may be walking around, they may be at the office or wherever they are and they're waiting for something and, and they go through tick tock.

Yeah.

I've talked with a couple of people about this, but a big increase in media availability is autonomous driving.

We're going to have to have something to do and it's going to be media and it's not just going to be ambient, we're going to be able to, you know, there's screens everywhere and that they need to

I, you, It's, it's, uh, when people, people are, but we already see when somebody is riding around in an Uber, Uber.

they're looking when they're in a subway, they're looking.

So, they're watching something.

It's, it's not just listening, it's watching, it's playing.

And that is going to be competitive for ad dollars.

And like Uber is in the ad game.

Everyone just like competition is everywhere.

I like called it like omni competition.

and that's why it's a growing business, but a really difficult business.

But I want to talk about some of the difficult stuff and that's around the open web.

Right.

I mean, I believe in the report, it said digital publishers face existential risk.

I think that was from, from Gen AI.

but how much, how much of the, of the existential risk really falls to those who are reliant on text?

I think in a position you don't want to be right now is you don't want to be, you know, You don't want to have your portfolio too exposed to text, particularly text that isn't behind a paywall that people can put down like ideally a corporate credit card for access to.

Well, we're going to see the publishing and what I mean, publishing, I really mean, on digital publishing there.

They're they've learned the lessons.

They learned the lessons of what happened.

with Google.

They've learned those lessons, and so they're moving much more aggressively.

As you saw, News Corp is now suing perplexity.

You're you're going to see more of this because they don't want They don't, they want to be able to be in a position where somebody it's the AI is, is taking from a human being.

The AI didn't write the article.

The AI didn't do the investigation or the point of view.

And so they're right.

I, but, but at the same time, they're like, there's other businesses.

I mean, certainly the music business with all of the music clones is, is also a So there are going to be parts of these businesses that are going to be challenged, but I think there they have enough time to get ahead of it.

Yes, we've got very large, we, we've got very, very large audiences or users for each of the dedicated search platforms.

I'll tell you where it's also may not be an existential threat, but it's definitely a threat is with.

Web search.

So if you think web search, this is if you want to know where the web search is a 300 billion business.

But if you want to know where it's going to, where the web goes, it's so much of it's driven by web search.

It's what you see, what you buy.

It's really the, the, the critical piece of it.

So what we're, we're seeing is there are already 15 million people in the U S who are using a dedicated AI platform to start their web search and we're forecasting

GBT or perplexity.

Exactly.

Anthropic, whatever it might be, but that's where they're, they're starting and it's, it's not, it's hard, it's not hard to understand because they, there's very deep penetration of these, these services and people have seen the answers may be more useful.

It's a different, the answer, and of course, both Bing and, and Google are building in the AI into your answers, but, but people are now establishing a new habit.

Yeah, it's funny because you, this is how fast this world works.

Like you, you, you talk about legacy search services, which I love.

It's guess what?

Like the newcomers always become legacy.

You know, like I think about legacy digital publishers and they're like, wait a second.

Weren't we the disruptors?

Like it seems like yesterday.

Yeah, it, it, it, it's, I, I

But won't, won't, won't Google just adopt that?

I mean, they've got Jenna AI overviews in a portion.

That's going to grow next year.

They have so many advantages, these, Google can make so many mistakes.

They can make so many and it, it, it doesn't dent them.

do you see this as a real threat to the dominance that Google holds over basically all of the internet?

I, I don't see it as a threat to the overall dominance.

What I do see is lots of new players who are nipping at their heels.

The, the need for Google to continue to grow, to maintain its stock price, the, the need for Google to literally take, take away margins from, from businesses.

It's not such some, it's not just the big retailers, it's not just Nordstrom.

Or, or, or target.

It's also the, the guy who has a restaurant who, or a car dealership in town and needs to pay for Google and Google continues to get more expensive.

So it's, it's different than the, the battle between being in Google being from Microsoft, of course, because.

because my Google controls the business, but you only have to have a percentage point of search move to another place and it, and it, it is a challenge for them.

Yeah, I mean, people talk about Bing as some kind of like embarrassing failure, like Bing is like a big business compared to like most particularly publishing businesses.

You can lose at search and you still win.

I mean, that's how great the search market is.

I've never seen a media business, which is more profitable, than, than search engines.

And especially as you get to a point where these two, these are dominant services, but It's hard for anybody.

It's been hard for anybody to compete with him, but, but let's not forget.

All of these things go in cycles.

So the people were the innovators later become the, the legacy with it.

There was a point Yahoo in public at a hundred billion dollars originally.

And before that, let's not forget, it was called Dave and Jerry's.

Guide to the, to the world wide web.

And so there's nothing technology does not stop when somebody gets rich.

Yeah,

got to expect that somewhere along the way.

There's nobody expected.

Tick tock.

It's it's really driven.

look at what's happened.

Instagram.

Instagram is now a video service, YouTube shorts.

Definitely.

So, but tick tock keeps growing tick tock.

We're forecasting that tick tock is going to have a lot of advertising in the next couple of years.

But you, you also, it seems like you think that social video is not going to, so you have social video hitting a bit of a wall.

Well, it's slowing down.

Yeah, It's

Absolutely.

It's slowing down in the U.

S.

Because and what I mean slowing down, it's just the amount of time that that people are spending with it.

But it's still at very high levels.

On average, tick tock at 51 minutes on average YouTube at 51 minutes.

you start going through this Instagram at 30.

You start seeing that these businesses are are really saturated.

so with tick tock, are they hitting?

Is there a risk of them hitting a ceiling?

Because, you know, the short form video, at least the figures that you have, you know, there's, there's less, you forecast, a slowdown in the growth of consumption.

that, that is very likely the, well, where tick tock is likely to go is longer videos already.

They, they have ways of keeping people on the site.

One of them is, is going part one, part two, part three, part four on some of the most engaging video.

And they're going to just give people the ability to do longer video.

And we should expect to see that.

we, I would suspect that they're already testing it.

And, and, and this game is all about engagement and engagement will come from somebody else.

As the market goes down, you're going to see that, that they're going to move share.

Everybody's going to try to do so.

So one, something that stood out to me and it's just stood up like in general is the resilience of live events and if not just resilience, just like growth of them.

And it's interesting cause I, I almost feel like there's these two counter narratives are just realities, right?

Of, you know, people are spending more time like immersed in their own sort of personal media bubbles.

Cause you can now.

, right?

But then at the same time, there is like a very vibrant live events, you know, sector, that, that you highlight in the report.

are how are, how do you square those two things?

The people, a couple of things have happened in the last years.

One is people were cooped up at home during the pandemic and they were hungry to go out and do things out of their homes.

Second of all, they're going out not just because they want to see an artist perform or they want to go to a theme park, but they also want to, it's a, it's a social environment.

Even if they're people they don't know, it, it does become social because they are going to an event, most of the time, not by themselves and going with either with a partner or a small group.

And And then finally, it's, it's being able to experience something together and feeling like you're, you're going to a concert, you're with all these other people.

It's there's people don't just go because they want to Taylor Swift because they want to hear her music.

They, they want to be in her orbit and they want to be around other people that are Swifties.

Yeah, for sure.

and finally I have to, any podcast has to talk about podcasting, right?

So, you have that, podcast advertising will grow.

From 2.

3 billion, this year to about 3.

1 billion in 2028.

I mean, podcasting is one of those things that, man, it just keeps going.

It never, it never took off.

It was never a rocket ship.

but it keeps, it keeps going and going and going.

And I don't know, I don't, What do you, how do you like assess like the, the podcast market?

I mean, it never became this like massive media form, but then when you look at what's going on in the presidential election, like we're in the like last couple of weeks and it's like dueling podcast appearances.

There's podcasting has grown very quickly, but we are at 130 plus million users or audience listeners.

And it comes back to what I said earlier about audio.

It's definitely an ambient, it's a, an activity you can do with everything else.

I mean, the challenge has been not the interest in engagement.

It's been the money.

It's not, it's not that great because it's really only the top podcasts.

It's the top 30 that really are able to make money because they can attract advertising and they can consistently get large groups of listeners, but there's

you said like half, half the listening goes to the top 25 shows out of 4.

2 million.

I mean, that's a power law.

Yeah, and by the way, it doesn't have to be the same.

There are people who come into this, but, but it comes down to this is, you could argue it's the long tail, but of, of programming, I don't like the word content.

I think it makes everything seem sort of vanilla, but it's people have deep interests.

They're going to listen to you, they're going to listen to, think about some of the other podcasts, they're going to listen to somebody who's got a very fine point of view on something, and they want that insight, and they, or want to hear stories, they want to hear information in a way, and narratives that they're not going to get some other way

. Brian: Yeah.

I think podcasting, I've been trying to work it out, but like they, podcasting in some ways is benefits from being downstream because it's downstream of you know, news.

Right.

But like it is, it, so the costs can be like, can be lower, but because it's very like human.

driven, like it's a very personality driven medium.

Like you either the, you know, you either like the, the, the, the viewpoint of, of Joe Rogan or whatever the host is, or you like the dynamic between, between the hosts.

and I also think that podcasting because it has had such a discoverability issue, like it, it hasn't been able to be growth hacked as easy as other forms of digital media.

That's my working theory.

and I think people kind of like gravitate to that.

It's just a little, it's got a little,

I think there's another, I totally agree with you that there's another reason why the only the top podcasts are making money and are getting the revenue and, and, and the, part of it is as advertisers don't know what to make of it.

And so you see the that's the most effective are people that are direct to consumer brands and those are the people that, that really find it useful

. And they're just, so it may be small amounts of money going around it's a habit that is to stay.

it's spending almost two and a half hours a day, listening to audio, it's not just then are going to be a big part of their daily diet.

Yeah.

I don't know.

I don't want to tell the advertisers how to do their business, but I just think that the obsession with performance marketing and being able to put everything on a spreadsheet and like closed loop attribution, everything, sometimes you miss things like The branding from, from, podcasts like has to be tremendous because people are immersed.

I know it's like an ambient media, but like they have a connection to it.

And I just know just when you talk, if you have a podcast and you talk to someone who listens to your podcast, like it's qualitatively different than other media formats.

There is something about the human voice and I don't know if this is just a measurement issue or whether, you know, it's probably a combination of things, but I think the fact that it's like a DR medium kind of is weird because you can't click on anything.

It's a pain in the ass to like actually take an action.

You're like, what, like running and then you're going to pull over get your phone out and do something, buy

well, I mean, I totally agree with you.

It's a very personal . is also, let's not forget, a lot of the ads, these are not like radio ads, a lot of them are really spoken or explained by a host, which it adds a lot more credibility to the advertising and in some, and, it's no different than what we're seeing across YouTube, which is there are a lot of people who have large audiences and they're sponsored in the case of podcasts.

The extent to which you've got a personal connection with the host and the host is a person who is, who is talking to you about the product, but that's more upper funnel and it's more brand.

A lot of perform marketers as they get to the where performance marketing, it gets, it's very expensive for them.

Then podcasts, a great place for them to be.

Yeah.

And the final thing is on the podcasting front is, I mean, you expect more media companies to move to subscription models.

I know you cited like the Economist and, and the Times is, is gone.

I don't know about the time, how the Times

But they're just they're just raising their paywalls even higher.

yeah.

is that because the ad market is not as robust here, or is this just the direction of travel for most, digital publishers?

I think that they there's a general belief and in most cases, they're correct that they are not capturing the full benefit of their editorial and, and especially in digital publishing business where.

The advertising gets to be more difficult.

The open web has less advertising.

And so they know they can get money from scriber.

And when you've got a subscriber, they tend to be more loyal.

And the, publications or the digital publishers that are increasing or moving to, to different kinds of subscriber models, value the programming or the editorial and at the same time from an advertiser perspective, they are the people that advertisers are the most interested in.

Yeah, sadly, newsletters did not make the cut for this report, unless I missed them.

No, we can't, we can't cover everything.

one, one

Someday newsletters will get on the report.

there are a number of things that I'd like to cover This is a huge amount of work every year, and our team begins in January.

They choose the topics they, there's usually some skepticism, so everybody started off wondering about spatial computing and later on really dove in.

And, and agreed with that, the iPhone moment spatials iPhone moment is, is within sight that we're going to have it in the next couple of years.

And there are areas that, that we haven't covered this year that we'll cover in future years.

Messaging, and more so than practically anything else

I like the spatial computing part because I was like, first I was like, I'm not even sure if I know exactly what it is.

And I was like, Oh, this is like a broad category for all the VR I think VR needs to leave behind VR.

I think the branding of VR is just tough now at this point.

I mean, Apple, I think you're going to have to soon ask at an Apple store, they're going to keep the, like that vision pro behind the counter because I've noticed like it keeps shrinking in prominence in the store.

and they're like, Oh, let's just forget about

they just announced that they're going to stop production of the current model.

They have enough inventories.

So that really means they're not giving up.

And if anything, they're going to produce a low, it's been the Apple strategy, which is to go out with a high price product.

And you can see they did that with monitors So will they win?

Yeah.

I mean, we believe that the device that wins going back to what you were just saying is not a VR device and it's not even, but you can call a pass through device.

It's not like the, the vision pro or medical quest.

it's more about which, which have a camera in front.

It's more of the pass through

I explained pass through.

is see through devices like a regular set of glasses.

You can wear them all the time and Snap Speckles is getting there.

It hasn't been released to the general public, but developers are, are working with it now.

Okay, cool.

that was all on my list.

We didn't get into the video games, which will, it will depress my other podcast co host, Alex, because he's into video games.

any other sort of things that stood up to you that's different from, from previous years?

I'm just trying to think about what's, the difference.

I, I, I think it, well, you don't want to talk video games and, let me just think for a second.

I just feel like they're like a massive category that almost is, I don't want to say it's overlooked, but it almost has always operated parallel to the overall media industry, but

yeah, we could talk a little bit about sports and.

Oh yeah, sports.

But I mean, is sports, like sports has, has, has had such a moment because it is the last thing that's keeping up live TV.

At least that's my

Well, it's been the last thing, but it's now moving to stream.

So you look at the deals that the NBA has done.

a lot is going off of television into streaming.

Right.

But a shared experience.

You do not have shared.

Shared experiences have been atomized away.

And so everyone watching the same thing, I don't care if it's on a computer, on a watch, on a phone, on a streaming pay TV cable, whatever is kind of unique.

It's unique now.

I mean, there's no whatever, however many people watch the mash finale that are like, that's gone.

It's not coming back.

Yeah, but that's been declining.

That's been declining for years and years and years.

I mean, I, we look at this years ago, we'd see the same thing, which is the audiences.

It's, it's not, not everybody's converging on the same thing.

But sports is also, it's It has such a, a cultural resonance that is, is kind of, to me, it's it's one of the last bastions of truly mass media.

I mean, and it's not necessarily mass like it used to be, but this is something that cuts across like lots of demographics.

It is, you know, it has cultural resonance, compare it to like video games.

I always, I always say this to Alex, Yes, like video games have like complete, you know, cultural resonance in that.

However, it's a large niche to some degree where I don't think sports is the

mean, if you've got 3.

6 billion people globally who are, playing video games, 3.

6 billion global gamers.

then it's hard to ignore it.

And a lot of people just forget about it.

we believe that most tech companies will end up buying the major video game companies.

the amount, what it would take to buy out these companies is really one day's volatility for any of those huge companies.

I mean, that's why I like the order is technology and then media.

Exactly.

Exactly.

All right, Michael.

Thank

This has been such a pleasure.

Really a pleasure.

Thanks again.