Comcast Splits, OpenAI Weighs IPO Delay, and Buttigieg Targeted

Pivot - New York Magazine

Pivot discusses Comcast's spin-off of NBC Universal, OpenAI's potential IPO delay, and political commentary on Buttigieg and Scott Wiener. The hosts blend media trends with sharp cultural critique and humor.

Key takeaways

• Comcast split boosts stock via focused growth businesses

Transcript preview

Can I just tell you I love the word vulgar I love the word vulgarities you are vulgar sir? Hi everyone this is pivot from New York magazine in the Vox media podcast network I'm Kara Swisher and I'm Scott Galloway Scott they just did a profile me the AP did and who did they call you and Gavin Newsom two men white men I annoy all the time and also Tom Tillis all white guys well it's funny when people meet us they another, me and Gather, me and Governor Newsom. Yeah, yeah, except for the hair part. Yeah, except for the handsome tall part. Handsome, dreamy. Yeah, none of that. The dreamy. Let me read the description of our relationship. I did not, I did not put him up to this. She and Galloway have developed a strong, if unlikely chemistry in which his pension full vulgaries can make her seem almost high brow. it's vulgarity. Oh and so you're Coco Chanel. I am coquish, no I'm not a Nazi. Can I just tell you I love the word the relating Nazis. Sorry I had to do that. I love the word vulgarities. You know what I find you know what's most shocking? You know what's most shocking about the vulgarity is that I think women like it more than the men. I get a lot of. You know what's most shocking? You know what's most shocking. You're most talking about the vulgarity is that that. I think that. I think that. I think that. I think that. I think that. I think that. I think that. I think that. I think that. I think that. I think that. I think that. I think that. I think that. I think that. I think that. I think that. I think that. I think that. I think that. I think that. I think that. I think that. I think that. I think that. I think that I that was I mean I don't call it a puff piece because AP doesn't really do puff but it was pretty complimentary yeah it was I'm a power broker oh my oh that's right they made it sound like you're the new kingmaker you're gonna decide by the way who's gonna be the next president because according to AP you get to decide the nanobler like a memorial because it can fix the algae yeah I don't know I don't know who shall I don't know who shall I select among the many fine people of the country I would like that because I'd get to go to the Lincoln bedroom largely I don't think business people should be president oh you're right maybe he wouldn't be good who would we pick pick a celebrity well I mean a magic wand anybody yeah yeah I don't think you can get through the Democratic primary but in terms of pure intellect served as country I would pick Mayor Pete I'm doing an event with him soon oh we're gonna talk about him lately I love I know I know I just I love high-I love high-key people I think at some point at some point has to make a comeback in the Oval Office. He would be a good. There's a lot of good. There's a lot of people I'd like to be president. I'd love Governor Newsom, Governor Shapiro, Governor Pritzker. Is there any Republican you like? I think Ambassador Haley is quite talented. If she would stop sucking up, if she would just be here already. Come on, there's no way to survive that orbit. Any Republicans. I think there's a move for someone who does resist. I agree. someone who's going to be able to be is I thought when he finally got his balls Tom Tills was really smart and like very good business person really sharp he was actually very supportive of gay rights oddly enough yeah I agree if I had you know picked that person and someone I didn't just I disagree with a lot but Mike Gallagher I was always impressed with although we totally disagree he had some really gross gay issue with stuff but but like smart people smart people smart people smart is smart is what we're talking about smart I mean have you ever wanted Romney to be president more? Yeah. I don't know I think there's a lot of I think there's some talented Republicans they've been benched and kind of shoved off to the side and also just on an objective level and I realize I'm not objective but there's some objectivity here I think the Democrats have an outst-offs of is giving great Camelot energy right now I think Mark Kelly doesn't have kind of the ris of a president but he'd be an outstanding president There's a ton of... Secretary of Defense that's what they should do for him if they don't... Oh, 100%. He'll be in the cabinet. He'll be in the cabinet. He'll be in the cabinet. He'll be in the cabinet. He'll be in the cabinet. He'll be in the cabinet. As long as the governor gets to a point, the next, anyway. I don't know. I vote for the vulgar Scott Callaway. There you know. A chicken in the Lincoln bedroom just for... Hello later. I'd open a dispensary. Oh, I'd open a dispensary. Oh, You want to see a UFC fight? I'm opening a dispensary on the East Lawn on the West. And I would like, I would have the nano bubbler business everywhere. I'd be bubbling nanos everything. I don't know what that is. Let me just tell you, nano bubbler for president. Anyway, we got, we got so much to get to today. What else is going on, Scott? Where are you, London. I'm in London where it's down to 72. When it's 78 here, it feels like Africa. Yeah. You. You didn't. You didn't. You didn't. You didn't. You didn't. You didn't. You didn't. You didn't. You didn't. You didn't. You didn't. You didn't. You didn't. You didn't. You didn't. You didn't. You didn't. You didn't. You didn't. You didn't. You didn't. That was hot as fuck-at-ee-fuck in France. And the metaphor for the UK is the following. I have air conditioning except when you need it. It doesn't work. If it's 65 degrees, I can cool my house to 55. But once it gets above 80, it just doesn't work. Oh, wow. They're not good with the air conditioning there. They got to get good with it, because every summer, it seems worse and worse. I mean, they're ovens, those apartments. They really. It's because the dog was wearing shorts. You were by the ocean, but in Paris it was very hot. I am headed to Vermont where it's going to be really hot here, it's going to be hot there, it's going to be hot all across the East Coast this week. This heat stuff is really something. I gotta say, it's become, we got to really think hard about it doing. And by the way, data centers. Now, anyway, we've got a lot to get to today, so much news, so much news. Scott even participated in the group chat, Actually, his selections were correct. But because the first one is something, I think I was a little, was I surprised? Comcast is spinning off NBC Universal and Skye into a separate publicly traded company. The new NBC Universal will include NBC, the Universal Film Studio, theme parks and Skye, this is the satellite service they have in Europe. Comcast keeps Xfinity internet and wireless, so it's back to square one, I guess. The market liked it. Comcast shares jumped 21% in pre-market trading Monday morning. a totally clean break. Comcast will hold a roughly 20% stake in the new NBC Universe. I think they still have a big stake in MS now too. And the deals expect to close in about a year. There's a catch though. Analysts say well the spinoff gives NBC Universal more freedom to do deals that leaves Comcast's broadband business more exposed at a time when cable is already under pressure. So talk about this. The people they're putting in place are very good executives. But does NBC now re-merge with MS now? what and the I don't know you need to explain this to me I really didn't quite understand why they're doing it now what the troubles they're seeking I know they had looked at buying Warner at one point so could Netflix by NBC Universal there's a lot there there's a lot at those studios so thoughts so this is why companies conglomerate can conglomerate the board who decides the CEO's compensation hires a firm called Towers Perrin because compensation is the that a board does. And because boards don't want to do any work, they pay this firm Towers Parent 2 or 300,000 dollars and they come in with a survey. And the survey says on a scale of 0 to 100, 50 being the average compensation and they look at the industry and the size of the business. And so if you're running a bank that does a $80 billion in business or whatever, then the average compensation is $20 million. So the incentives, also the testosterone and the penis in the midlife crisis all lead incentives to the CEO to get bigger and bigger and bigger and bigger and sometimes there are real synergies around different businesses but almost always not typically what happens is you end up with a Frankenstein and so the market gets to a point where you have these Frankenstein's of businesses that had no synergy and what the market can I change the matter what's a turduckin that. And what the market has a tendency to do is it looks at the shittiest business because it says there's no synergy here and it says okay New York Times you own 17% of the Boston Red Sox and the 7th tallest building in America this this is how much the Boston Red Sox are worth but instead we're gonna look at your shittiest business your regional newspapers which traded four to five times Ebita and we're gonna sign that multiple to the entire business because they don't give you don't give you don't give you for the stuff that's working really well. So the disposition of assets becomes a creative to shareholders. And in this case, you have a media business that's strong and growing, while the connectivity business is shrinking. And what they do is shareholders assign the multiple on the connectivity business to the strong and growing business. Last quarter, the media division, get this, reported a 40% increase in revenue to nearly 12 billion for the quarter. Theme parks grew 24%. Media grew 61. 1% and studios grew 21% and over the same period the connectivity division shrunk revenues 3%. So what you have is it... So it's connectivity that's not... That's right. Residential connectivity shrunk about 4% while business connectivity grew 6%. So what happens is if you split these things apart you have one company the connectivity business which is a mature business that's in structural decline but still spends off a ton of cash. And then you have a growth business. When it becomes a pure play growth business gets a much higher multiple and the result is a stock that was up 25% based on these two companies that have more focus So what happens to each of them is they're like look you have MS they they split off MS now And now it's trying to create its own little new division and doing well for what it is right? It actually has seen some growth under those executives and then you have the media business that has by the way there's some fine executives at the media Donalangley, I think Mike, anyway, it's a very smart group of people whenever I meet them I'm always so impressed. But they weren't able to participate in the Warner thing for example and I know it was frustrating because they were actually the natural owner for that. Agreed. You know, I was like, of all the things I was like Paramount there are a bunch of incompetence. Netflix is gonna is too big and gonna get in trouble. Comcast was the perfect buyer for that you know in terms of quality people and the theme, and the everything else. So what happens here and the other thing just as a side like the other two things could Netflix come in and do something here I think it's too much Disney CFO has signaled they intend to keep the linear and streaming businesses together for now they know they don't own a cable division and not split it off so they're keeping those together the studios and the streaming and everything else so it is the strategy it seems like it's the same strategy if they're gonna hold on to see Universal Film Studio, Theaparks, and Sky. Right? So that's a little connectivity, I guess. But thoughts on that? What happens to each of these parts? What happens to the cable parts? What happens to the cable parts? I mean, could like Elon come in and buy the cable parts for Starlink? Or there were rumors of him buying one of the phone service businesses. Thoughts? Well, I mean, it's scary, but with a $2 trillion market cap, there's very little we couldn't buy right now. So Versant, their stock is down 21% since the spin-off. I don't know what happens. Okay, first off, Disney, for the time being, is holding on to its cable assets, that means they have no one's off for the price they want. It will make sense for them to shed that business. Because the parks, the IRS, the parks, the IRS is an unbelievable business. So this is all a long way of saying, I'm not sure what they're going to do, but they have simplified and created pure place. Because here's the bottom line, if you're the bottom line, if you put if you put They don't need the Roberts family to diversify for them. CEOs love diversification. Why? Okay, my connectivity business is down, but my parks were up 24%. In other words, they sleep better at night because they can grow six, eight, ten percent a year and not worry that, oh fuck, I got a problem at MS NBC. Whereas this is a thing though, investors, I don't need you to diversify for me. I can buy Vassan stock if I think it's really cheap. I can buy the parks business stock if I think it's a grower and I want growth. But CEOs incentive and compensation and quite frankly wanting to sleep at night and be bigger and batter leads to an agglomeration or a conglomeration that eventually the stock market throws up on and that's what's happened here and you know what the next really? There's a stock right now that if it broke up it would triple you know what that company is? What's that? What's that? What is? last Sunday night. I don't know. What is it? Maybe you've mentioned it before. Now they give you another hint. VR but only subscale. Oh, Snapchat. If Snap spun their Spectacles group, the stock would triple or quadruple. Oh, interesting. That is the most, that is the greatest unlock waiting. He loves them spectacles though. Well, that's the problem. It's a single, it's a dual-class shareholder and the evident controls the company. Yeah, they're. Yeah. Yeah, they love some spectacles. Do. Do you. Do you know. that I think Meta gets about $400 in market cap per user, Snap gets 17. Wow. Yeah, you're right. He should get rid of the spectacles. If they spun and did a deal with chamee or something, if they spun the spectacles group and it was just a pure play social media platform, rocket ship. Interesting. Ooh, I like that idea. Get this, do you know how much the stock is off the last five years? A lot. A lot. Yeah.