（预告）美国如何失去稀土、Netflix与Spotify及Bill Simmons合作，以及机器人出租车大战将走向何方

Hello, and welcome to a free preview of Sharp Tech. But I think there is still that capacity. So I’m optimistic that the US will be able to respond, but we’ll have to wait and see. At this point, it’s all speculative.

I love your optimism. We are also 48 minutes in, and I think we got one email, so we are failing at our task right now.

That’s right. It’s time to move. Jeremy says:

Will Sharp Tech answer emails before Ben filibusters the entire episode? Another competition worth keeping track of.

Jeremy says, “Why would Spotify and The Ringer do that deal with Netflix for the podcasts? Is the answer that this is the beginning of an anti-YouTube alliance?” So I’m going to read from The New York Times.

When did Jeremy send this email? I do have to wonder, because that was my take: the anti-YouTube alliance. I want to either compliment him on “great minds think alike” or gripe about him.

He did get it in. He got it in before your Thursday update on this news.

Okay, good job, Jeremy.

So congrats to Jeremy.

We’re on the same page. Yes.

1. Netflix Joins The YouTube Fight

The news from The New York Times, for everybody who hasn’t seen it: After months of speculation, Netflix is taking its first step into the world of video podcasting. The streaming giant announced a partnership with the audio company Spotify on Tuesday that would bring numerous video podcasts on sports, culture, entertainment, and true crime to Netflix early next year.

The deal prevents those shows from airing in their entirety on YouTube, Netflix’s biggest competitor. The 16 shows in the deal are produced by Spotify Studios and The Ringer, the website and podcasting network that Bill Simmons started and that Spotify acquired in 2020. The shows include two popular true-crime podcasts, Conspiracy Theories and Serial Killers, The Bill Simmons Podcast, and The Rewatchables, which features Mr. Simmons and a roundtable of movie lovers discussing their favorite films.

I am a big Rewatchables fan, probably my favorite podcast out there, other than all the podcasts that I myself host. Ben, what do you think of what’s happening here? There’s a chance we may eventually get to watch you on Netflix if the Simmons show is going to be on Netflix every week.

That is true. Well, first off, I think the overarching point of all this is that YouTube is a threat to everyone.

Mm-hmm.

They’re the biggest problem for Netflix, and they’re the biggest problem for Spotify. There’s an aspect here where these are natural allies, sort of in the way the e-commerce ecosystem was natural allies in taking on Amazon, right? Jeremy is spot-on: anti-YouTube alliance, for sure.

I think the specific dynamics of this deal are really interesting and problematic, I would say, for Netflix. I put myself in the position of, let’s say tomorrow Netflix comes to us and says, “We would like to put Sharp Tech on Netflix, and the requirement is you can’t be on YouTube.”

Fine. No problem.

I would be like, “Sign me up. No problem.”

Yeah.

Why? Because I have a completely diversified business. We don’t make any of our revenue from YouTube, even though we have segments on there. My whole business is separate from YouTube, so from my perspective, YouTube would be nice—

Mm-hmm.

—but if Netflix wants to give me guaranteed money, absolutely. I’ll take it. I’ll put it on there. So if you’re listening, Netflix or Spotify, there you go.

Yeah.

Put Sharp Tech on your network. Invest in a lot of nice cameras and equipment. You see this background I have. Sign me up.

I’ve got a lush basement ready for Netflix. Absolutely. Let’s do it.

Right.

Now, why do we have some clips on YouTube? Well, because, at least in theory, YouTube is a way to grow. If you get in the algorithm, people are introduced to you, and so on. It’s hard to grow podcasts. It’s something we want to experiment with. We’ve talked about doing more video. I think the immersive podcast is probably a bad idea, but there’s something there that could be done. It’s not critical to our business.

Mm-hmm.

We are a podcast. We’re audio-first, and that’s just the way it is. We see video as a route to growth, but we don’t see video as a baseline requirement.

That’s the case for Bill Simmons.

We’re reliant on subscriptions as opposed to the ad market, so growing in the YouTube area is less of an existential urgency.

That’s right.

We see YouTube as a top-of-the-funnel way to get people in and potentially subscribe.

Yeah.

We don’t need YouTube ad money. That’s the case with Bill Simmons. Bill’s one of the earliest podcasters, first with ESPN, then with his own podcast. He has a huge built-in audience. He sells lots of ads to that audience and makes millions of dollars a year doing it.

It was sufficient for Spotify to buy the whole thing for $270 million or whatever it was. Maybe a time-and-place sort of thing, but good for Bill. I’m happy for him. It’s great. He’s set. If Netflix adds more and wants to pay him for the stuff he’s already doing—although hopefully with better camera equipment, because it drives me up the wall how bad Bill’s camera is—

The camera has improved. I believe the camera has improved. I’m not a regular on the Bill Simmons YouTube channel.

Yeah, Netflix, I’m sure, made sure that was the case.

Yeah.

It makes total sense for him to do that. Unfortunately, all the new podcasts—meaning not just the big podcasts today, but basically every podcast from here until the indefinite future—

Mm-hmm.

—are YouTube-first. They start with video. They start on there. That’s where they get their audience. YouTube is the aggregator. They have the audience, they deliver it via the algorithm, people click and subscribe, and hit the notification bell or whatever it’s called.

Mm-hmm.

Then they make money from YouTube via YouTube ads. Suddenly they’re like, “Why would I go anywhere else?” I’ll lose my listeners, who I don’t have as tight a hold on because YouTube doesn’t let me have a direct connection with listeners, so it’s harder to take them with me. And also, I make money on YouTube, so pulling viewers away from YouTube is difficult.

I don’t see why Netflix is going to have to pay so much to get a YouTube podcaster off of YouTube. And for that podcaster, it’s probably going to be a bad idea. There’s a reason Joe Rogan got pulled off YouTube and then was back on as part of his most recent deal. It just cost him too much in terms of PR, relevancy, and probably money and all sorts of things.

Customer acquisition, yeah.

That’s right.

So on one hand, this deal makes sense for Netflix: let’s try to get in the space.

Mm-hmm.

But they’re actually in a pretty bad position because they have a very limited pool of people they can use to do this. They are network TV in this case, sort of stuck in their lane, hoping to ride on established names and established stars. Let’s do Law & Order version 57 for the five-gazillionth time because it’s a brand people know.

Sorry, Bill Simmons, you’re Law & Order number 57, right? People know you, so that might help to get this off the ground, but they have a long path to go to actually develop the sort of business where they’re going to get the podcasters of the future. YouTube owns the future, and that’s a big problem for both Netflix and Spotify.

Yeah, it’s interesting. I understand why Netflix would go this direction. It’s a worthwhile experiment, maybe, but you look at the bifurcated entertainment landscape that we talk about all the time. You’ve got premium products on one end, and then you’ve got the long tail on the other.

This seems like Netflix, which is a premium product, trying to compete with the long tail, and it just strikes me as an idea that won’t get very far, in part because YouTube has 10 times as many podcasters and people are used to watching podcasts on YouTube.

Yeah. People go to YouTube for podcasts, right?

Right.

Nobody’s going to Netflix to—

Yeah.

—watch podcasts.

Yeah.

And I understand trying to create new user habits, but you’re trying to create new user habits with 1% of the content. It’s just hard for me to imagine this idea getting very far.

It is kind of an interesting window into Netflix’s psychology.

It’s a window into how threatened both companies are by YouTube.

Exactly. They see YouTube as a long-term threat, and they’re exploring different ways to counter what people are going to YouTube for on a regular basis.

Netflix was the scruffy upstart with a random selection of movies, and you would watch stuff on there just because it was on Netflix, versus the much more structured, constrained network TV alternative.

What we're seeing is Netflix now being the old, stuffy structure. You go to Netflix for Netflix-type shows. If you want the random stuff of the world, that's on YouTube, and it's hard to go downmarket. You see this in tech companies, right? Enterprise companies end up going for the big companies because it's easier sales and more predictable.

Yeah.

But as you go upmarket, you can't go back downmarket. It's a one-way road.

Exactly.

And Netflix is on that one-way road. From a Spotify perspective, I think they're pushing video. No one thinks about Spotify for video. Spotify is an audio product.

Mm-hmm.

There's a lot about this that makes sense for these companies to band together generally, but it is a banding together under assault.

To lose together.

That's right, yeah.

Yeah. Good luck to all of them. I'll check out a Rewatchables episode on Netflix because I'm washed. I'm the type of person who will actually check this out, but I'm in the minority because most people—

Oh, speaking of washed—

—consume podcasts on YouTube, okay?

2. AI Video Goes Mainstream

I thought you were going to make some sort of comment about AI-generated video. I'm the one who's washed, totally missing the boat on it. But the best AI Sora user I know is, as I mentioned last time, this retired guy in my cigar group chat.

Mm-hmm.

He has a new workflow that he shared. He goes to Vibes, watches videos, and finds one that he's interested in. Then he copies the prompt and puts himself into it. Vibes is the inspiration for the video, and then he can add himself into the video. He dropped some bangers. It was amazing. It was such a good idea.

How old is this person who's doing this?

Like 65 or something, just running circles around us. It's embarrassing.

What I've found with AI video is that the people in my life who love AI video are either 65-plus or six years old and under. It's really big with toddlers and senior citizens. We'll see whether the middle of that graph ever catches on.

3. YouTube Creates The Value

But for now, one other question on video. Craig says, “In a recent episode, Ben mentioned that YouTube gives around 50% of ad revenue to creators. That got me thinking about how often the Apple 30% fee is framed as problematic, yet I don't often hear it discussed how YouTube takes 45%. Both of those look very similar to me. It's the creators or developers that are making YouTube and iPhone respectively valuable platforms that keep people coming back, yet YouTube takes a much bigger cut. What am I missing? Why does the Apple 30% fee get talked about so much but not the YouTube 45%?”

Ben, can I hazard a guess at the answer to this question?

You can. I have a very clear answer, so you're going to have to be spot-on, but we'll see how you do.

Okay, all right. You can grade the answer. YouTube is the company that's actually selling the ads and creating that additional value, so giving 50% of that money to creators is actually a pretty good deal for those creators. Whereas in Apple's case, the apps are doing all the work to generate sales independent of Apple, and then Apple comes in after the fact and takes 30%, basically as a toll for those businesses existing on iOS and having access to Apple users.

That's the difference. That's why there's more outrage at Apple than there is at YouTube. Grade me. What do you think?

A solid A. Not an A-plus, but a solid A.

Oh, boy.

Very well done.

I'll take it.

No, you're exactly right. YouTube is creating and enabling this entire thing.

Yeah.

Maybe an A-minus. Actually, I'm going to reduce this to A-minus. I'd say you missed 2 things. It's not just that they're selling the ads; they're delivering the audience. They're actually bringing people to you in a way that—

Mm-hmm.

—Meta is the one delivering the audience to app makers, not Apple. To the extent Apple makes money on ads, it's skimming off search, making you buy your own name so you show up at the top of the list. It's just a tax up and down.

Mm-hmm.

You can trivially—this is the other bit. You had 2 small misses that had me lower it.

Okay.

The other one is that it's not possible to recreate what YouTube did for any individual. An advertising mechanism like that has to be done at scale. The biggest YouTube creators actually make more money off of YouTube. They have sponsorship deals within their own episodes, and YouTube doesn't take anything from that.

They can do independent product-placement deals, right?

That's right.

Yeah.

Your MKBHD, for example, makes way more money from that than he does from YouTube ads.

Mm-hmm.

If you're big enough, you can do that. And, by the way, Apple would probably try to take a cut of that if they were in charge, right?

Yeah.

YouTube's not touching that, number 1. And number 2, what they provide with AdSense and the entire advertising operation, you can't build that. No individual can build that. That has to be done at scale. You don't need Apple to collect payments for your app.

Mm-hmm.

You can use Stripe. You can use lots of other things. Apple's involvement is unnecessary. You touched on this—

Yeah.

—but I would've emphasized the necessity of YouTube's infrastructure. I think the YouTube deal is actually amazing.

Right.

The fact that they share as much with creators as they do is remarkable, because this entire ecosystem would not exist without YouTube. Its maintenance would not be possible without YouTube. This revenue is all because of them. They deliver the audience, they build this entire ad ecosystem, and they share a large amount.

4. Google's Generosity Wins

It speaks to the overall thesis I've developed about Google recently: their generosity is one of their biggest competitive strengths.

Mm-hmm.

We talk about it in the case of Apple and the search deal. They're giving Apple $20 billion of profits a year, and it seems dumb. People's minds explode: How can you say they have aggregation advantages if they're paying for this? It's like, no, this is what we want from all these companies. Make these big expenditures in the current day to build resilience and a dominant position over time.

And it's not a theoretical thing.

No.

5 minutes ago, we were talking about how YouTube podcasters won't want to go to Netflix because they're making a ton of money on YouTube, and Netflix would have to meet that price.

The thing you have to grapple with—

Yeah.

—is that you and your antitrust friends want to be upset—

Oh, God.

—about it. And meanwhile—

One day, I'm going to take off my wired EarPods and just quit the fucking podcast at some point. Oh, boy. But Google does it right, man. YouTube does it right.

If Google were in mining, we would be in a better position than we are because they wouldn't have optimized every single dollar.

Yep.

Google's lack of optimization and generosity is one of their biggest long-term competitive advantages.

Yeah. Well, and I don't know if the 50% number is exactly what YouTube shares with creators. I don't want to misquote Craig's—

No, I believe it's 55%. I think 55% goes to creators and YouTube keeps 45%.

Okay.

It's a crazy large number.

When I saw that, I was shocked. In any event, we'll keep it moving and shift from—

You know how much most creators would make from ads if YouTube didn't have this deal?

Zero.

Zero.

Yeah.

If you're one of the very largest, you could do a sponsorship—

Or if you're a creator—

Yeah.

—I mean, it's a substantial burden to go out and interface with advertisers and take on that responsibility. YouTube is doing all that.

Right, and this is what YouTube would say, because YouTube is trying to get into the product-placement and sponsorship business, where all these big creators make money.

Their argument is, “No, we're not stepping into your space. We just want to make this more broadly available to creators generally. So if you're not big enough to do brand deals, we will do brand deals on behalf of YouTube creators.”

I can understand why the biggest YouTube creators are a little wary of this, because you could see that maybe they had a deal with Samsung, and then Samsung says, “No, we're just doing it with YouTube, so just sign up for that program, and that's how you…” Then YouTube is taking a cut, right? So there is a bit here where I can see them being wary of this.

Yeah.

Because if you're big, you have privileges, like being able to interface with Samsung, that most people don't. But there is a real payoff in the number of creators that could potentially do brand deals because YouTube is operating as the interface. This is the key to being an aggregator that people love: you do stuff with scale that people can't do on their own.

Mm-hmm.

And, by the way, the number one thing that you can do at scale that people can't do on their own is run an ad business. It's why ads are good. It's why we get entities like YouTube. Again, going to that YouTube event and seeing big creators doing the presentation on YouTube's behalf was kind of mind-blowing. They're up there shilling for this company because they love it. It's made their life; it's made their career. And it actually is possible to aspire to be a YouTube creator.

Ads have made their career. YouTube's ad engine has made their career. Let's be more specific. Advertising is good and makes all those careers possible.

Right, and that's why, if YouTube wants to take 45%, God bless them. You deserve it.

Yeah, yeah, I completely agree.

30% from Apple, which doesn't do crap for you. It's a payment processor—a very good payment processor. It's very convenient for customers. There are lots of benefits to it. But I think that Apple will retain a lot of usage even if they allowed competition, because the seamlessness of the user experience is so great.

Mm-hmm.

But they don't give you a choice, and you can roll an alternative.

Yeah.

All right. To keep it moving, we have Matthew. He says:

“Ben and Andrew, big fan of the show, but I think the robotaxi wars aren't getting enough attention. This should be Ben's sweet spot at the intersection of tech and strategy, hardware and software. Ben talked about his experience riding in a Waymo a few months ago. Waymo has since launched in several more cities, some with Uber and some without Uber, clearly experimenting with different business models. Tesla recently launched its own robotaxi service in Austin, Texas, and is preparing to launch in several more cities exclusively on its own robotaxi app. And Uber is partnering with every AV player possible to make sure they have a path to autonomy.

“How does Ben see the very different strategies and competitive positions between Waymo, Tesla, and Uber playing out over the next 5 to 10 years? Love to hear your thoughts.”

So, Ben, this question came in a while ago. We're now an hour into the podcast, and there's a lot of meat on this particular bone. I think we probably should have an extended conversation about the robotaxi wars at some point. I'll be honest, though: I was teeing it up for you today because I know you've been using Tesla Full Self-Driving recently, so I wanted to give you a platform to discuss that experience. All right, and that is the end of the free preview. If you'd like to hear more from Ben and I, there are links to subscribe in the show notes, or you can also go to sharptech.fm. Either option will get you access to a personalized feed that has all the shows we do every week, plus lots more great content from Stratechery and the Stratechery Plus bundle. Check it out, and if you've got feedback, please email us at email@sharptech.fm.