Meta’s Prediction Market App, Europe vs. Big Tech, and Hollywood’s Comeback

Pivot

This episode of Pivot explores emerging tech trends, including Meta's entry into prediction markets, Europe's push for digital sovereignty, and the evolving media landscape. Scott Galloway and Kara Swisher discuss AI, creator economy dynamics, and regulatory challenges.

Key takeaways

• Meta's Arena prediction market signals renewed interest in decentralized forecasting.
• Europe is accelerating efforts to reduce dependency on U.S. tech through new sovereignty policies.
• AI is shifting from hype to practical integration, with creativity now seen as a key differentiator.

Transcript preview

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Try Odo for free at Odo. That's O-D-O-O-com. You love me. I do. Sadly, sadly, it's the worst relationship of my life and my finest. Hi everyone, this is Pivot from New York magazine in the Vox Media Podcast Network. I'm Kara Swisher. And I'm Scott Galloway. here at the Ad Week House at Can Lyons International Festival of Creativity, is that what it's called? All right, fine, we're doing that. Welcome, everybody. So let's just start, Scott, we haven't seen each other at all, correct? Not even slightly. Yeah, no, it's a great can't. I mean, we love this year. It's great can for both of us, so we don't have to see each other. I brought my children. We've having a lovely time. They were just in the Mediterranean this morning. with them except for the heat but how is your condo can sorry Jesus I love it here but I don't know if you saw that crazy drone show yeah that was cargo yeah it's actually the word is and I can validate this it's an alien craft it's an alien species of women who are no joke are abducting guys with enormous dicks so you're safe Oh yeah. Hello France. That took like five seconds to get to a penis joke and a highly complimentary one to yourself which is inaccurate but nonetheless don't ask me my nickname in the fraternity just don't just don't. Trey pod yeah. Tripod. Anyway. Sorry. It's twa. It's twa pod. It's twa pod. It's like you should you should take intentions or gestures with the intentions that they're made or that they're intended or going You know what I'm saying yeah okay no I don't not mean slightly All right let me just like How is your candy gone? How is it gone? It's great. It's the first time I've left my hotel Okay. All right. He's staying at the hotel when I was there age I used to have to work here and like you know me with Martin Sir? Yeah, I love, I absolutely love it here. What do you think are the big takeaways so far? So, hands down the biggest trend is the crater economy. There's 500 here, this year, there were 400 last year. It used to be, it's sort of ironic that this is meant to be a gathering. It's 13,000 people from 90 countries, it's meant to be a gathering to celebrate the industry, but the industry hasn't yet recognized they're no longer the protagonist. And that the industry, if you think of it, if you think of it, the means of it, the means of it, the production, the production, the production, the production, the production, the production, the 10 or 15 percent of the total revenue because in between there were these means of production or motes and ad agency distribution a studio makeup unions a cable going into people's homes and now people with these few platforms that commanded disproportionate margin they do really well but you have thousands it's no longer Madison Avenue it's a bunch of studios and the celebrities here are no longer when I used to come here Maurice Levy Martin Sorrell the closet. Now it's some creator who's talking about food, you know, so it's it really has there's a distribution from institutions to individuals. AI last year was what do we do with AI now it's how do we organize a company around AI and how do we get an ROI there? I think there's been people have come to the conclusion that AI is all chip in no salsa and the creativity has never been more important. AI takes everyone to the middle and it's very moderated and so creativity's never been more important. Remember AI was going to produce commercials. There's more designers now at IBM as a percentage of their employment and creatives than there was last year. So creativity appears to many come back. I have noticed the sort of fall off in the AI dementia that was here last year. I mean it's really, that's everywhere actually when everyone's sort of coming into conclusion that they're not really clear what efficacy this stuff has instead of. I mean, the drone AI and it was it was not AI it was it wasn't artificial intelligence it was something else they had another word what it was art and intelligence instead of artificial intelligence yeah yeah I think the other any other big trend is sports yeah there wasn't a sport beach here sport it really is the cultural religion now and it's it's one of the I mean the biggest I think the two biggest stories taking place right now one's positive and what's negative and the things we'll be talking about I like to predict what will be the biggest business stories that are happening. The biggest cultural story would be the coming together that basically the World Cup is doing what the UN was supposed to do. And these wonderful creators and this content that makes us feel better about the world when we really needed it. We needed to feel better about America and Waffle House and how wonderful Norwegians and the Scottish Shard. Go team Scotland against Brazil, it could happen tomorrow night. That is the best cultural story unfolding right now. The biggest story that's taking right now you're going to see that the predictions markets have a scary fucking amount of betting on the World Cup right now mostly from young men whose prefrontal court disease is very immature and are prone to addiction. I think that's the biggest story playing out right now. You're going to see that one third two thirds of young men in the United States bet on the World Cup and you're going to see Polymarket and Calshi basically show the kind of numbers that get Goldman and JPMorgan saying we're ready to go public. That's the biggest story playing out right now you did. Zuckerberg waiting into it. He's going to start a predictions market. He is, which is called Arena, which I mean did he ever have an idea he thought of himself that he didn't the thief? Yeah, but that's the key to shareholder value. Yeah. The innovator, the first iPod, the first computer, the first social media network, who's on Myspace? I mean it's the second mouse that gets the cheese. Apples, you imagine, because he tried it in a number of ways. They tried to do a dating service. Do you remember the Facebook dating service that didn't this, the Facebook that. Is this a good area? You're just, it's an important area right now, but they're also under enormous scrutiny. By, even in the, by US standards, they're under enormous scrutiny in the US, all these markets. They're getting push back all across the world from a regulatory point of view. And then Mark, whose reputation is just even this week got even more tarnish, we talked about it on the last episode, because Trump essentially called him a sucker. did essentially and was accurate. And do you think it's a great time to wade into this area for a company like Facebook or do you think these are inevitable companies that these that are happening? Yeah I think so if I were the head of corporate development at Meta I would take a 2 to 3 percent dilution and take 40 to 60 billion dollar flyer on either Cal sheet or poly market as opposed to trying to compete with them and go from letter A to F but we use the term innovation really promiscuously. shareholder value, it's not the innovator. The innovator and the pioneers get mud on their face and arrows in their back. It's the number two. Apple has never invented anything. What they do is they come in and they commercialize it and they do a better job of it. If I were meta and I'm not and I would be rushing to get things done before a Democrat takes the White House and actually starts trying to break up companies, which is what we need to bring affordability down as the rents being charged on advertisers and consumers and parents gets higher and hires as we let these companies. But I would be looking at everything and if I wanted to get into that market I would pick up one of those two players for 20 to 60 billion which at this point would be a minor delusion. Isn't a particularly good thing for their corporate image to go into an area that's under it's clearly going to be under attack in the next two years? I don't think they're worried about their image. Yeah, I know. Yeah, I mean there's, as we sit here there's a bunch of 14 year old girls self-cutting because of Cheryl Sandburg's business business model. too much. Yeah. So I don't I don't I think they're I think they're very willing to endure hits to their image I don't think that's their first priority. So they will go this is an area they should go into their image the only thing that fucking matters is Mark Zuckerberg keeps delivering unbelievable shareholder returns that's the only image that matters in a capitalist America with no regulation and we can sit here and talk about purity test no one gives it fuck all right well in Europe let me just they're trying to break up US big tech here in France the budget of American systems, sort of on trend with the Europeans feeling the American century is over, which I think is very clear. They've stepped up in a Ukraine, they've sort of pulled away from the US. You have Georgia Maloney every day insulting Trump, which is really enjoyable. And the EU just rolled out a new sovereignty package to boost homegrown tech, a very difficult thing to do. Google, Microsoft and Amazon control 70% of Europe's cloud market and 80% of European software spend goes to US companies. It also has to deal with these climate goals that they have in data center. Lobbyists say Europeans power grid isn't ready to fuel advanced AI infrastructure will need to lean on new gas plants to stay competitive, which is a big issue in the United States and actually gaining enormous amount of traction with voters 100% Europe's biggest techsaint shaping EU policy. A new group called the European tech creators is pushing the EU to cut red tape, loosen merger rules the way the US and China cut back theirs. Is that something you see happening? This is not the direction Europe had gone in and has had much less success obviously. All these US companies, whether it's open AI or or entropic or all US, the latest basket of them, whether they're going to make it or not, are US companies. Yeah, so America used to be the uncle who showed up who was obnoxious. You showed up to the European picnic. Obnoxious but nice, paid for your kids tuition, generally hard was in the right place. now the uncle is showing up, he's on meth and he's doing his karate moves and he's hitting on underage girls at the par. I mean, we have become so unreliable and quite frankly just gross that the EU has finally come to the realization we can't count on this guy any longer. And it can go one or two ways. The good way is that they figure out a way. Germany or I think 30, 40 percent debt to GDP, Netherlands, they need to probably go into some deficit spending, ramp up, ramp up their technology, and in their own military, support their own companies, Mistral, vertical aerospace, Daniel Ek is a big investor in a European defense company, I think that would be good. If they use this as yet another excuse to slow down their thoroughbreds with over-regulation, which is what Europe does, yield great, be righteous, worried about the environment and will kick your ass from a shareholder standpoint. And that's the story of Europe, thoughtful regulation that gets in the way of every company killing it. And America makes them. And America makes them the of under-regulating, Europe makes a mistake of over-regulating, and you'd rather be the former, because then you have the capital in the strength, the fund a Navy, when you do get a good leader in place. Economic growth, I mean, it's kind of everything. You have to have, the UK has, it's hard on the right place, super smart, and they can't do any of the ship because the economy's not growing. So there's a medium, if they use it as an excuse to support, force companies to purchase their own support European-born native internet e-commerce AI companies defense companies great if they use it as yet another excuse to increase regulation were talented entrepreneurs and capital to shrug their arms and leave is it even possible at this point because these companies are sort of barreling to IPOs despite the fact that for example SpaceX is really taken yet another fall we talked on Monday about this but it took a decent fall again it's still up from the IP oh it's trading at 120 times revenues kill for their problems. Yeah, I get that, but do you see it, is there a way to catch up in any way for other parts of the world to do so? Or are these the companies that will? Well, Europe has some great companies, and I'm actually in my prediction I'm going to talk about. I think the hottest IPO of the digital, of this month is actually going to be a European company and I'll talk about that on predictions. Look, they have some great companies. I do think there's going to be a lot The team of the best players wins and I