You're listening to DraftKings Network. This is the Dan Levatore Show with the Stugats podcast.

David Samson has just declared to John Skipper that they're no longer going to shake your hands anymore.

I'm not sure that we have ever, even when we completed a deal with Metalark, but you have these-We just hug.

We just hug. We're huggers. I'm a hugger.

I do find it strange that John likes telling stories before we start doing shows about his cleanliness. It's my favorite part.That's what I'm lacking.

Actually, you were correct. It was not true because my hands were wet when I came back.I.

Didn't want to call you out.

It just was a story.

Yes. I worry that's 70% of you.

These are the minds that lead us into the biggest topics in sports business. It's a genre that is never Never wanted for drama and massive evolution. We arrived this week on the Sporting Class with John Skipper and David Samson with Netflix, Marrying Goliath. The NFL and Netflix getting together. Netflix entering the live sports business officially now. A three-year deal, John. How do you see this deal? The idea that now they're going to carry NFL games on Christmas Day?

I think it's a very smart deal on the part of the NFL and Netflix. I've been consistent in thinking that Netflix will continue to poke their way into sports. I believe this is the first professional league or Sohan Schroeder, who probably did the deal or papered the deal, says the first professional league, smart of them to do it. They've been more cautious than Amazon, more cautious than Apple at diving in, but they're coming. They had a big live roast as well.

Yes, they did. It used to be they were going to be event-driven with the roast and with the Mike Tyson, Jake Paul fight. Now they're beginning to say, All right, let's try a rights deal, but we'll only make it the Christmas special because it's our favorite biggest day of the year when everyone watches Kevin Hart movies or whatever the case may be. But guess what? The next step is, and you know what? We're really cool on New Year's Day. That's a big day for Netflix. Then it's going to be a random Wednesday in March. This is how you get to doing full rights deals. Netflix is a player, and the leads and the owners are really, really happy today. The luck is that Christmas is on a Wednesday. That is the great news for the NFL.

Explain that.

Because there are no Wednesday games. They're not taking away a package from anybody. They're taking away regional games, you could argue, from CBS and Fox, but they're not in any way violating the contract of CBS and Fox. They created new inventory, which is the dream of any seller, which is to find new inventory with no incremental cost. That's what a Wednesday game is.

Yeah, I think it's just the natural evolution. Reid Hastings said long ago that he was interested in making money. He's making money now. He was letting his shareholders know that they were going to not dive into sports while they were losing money because sports are expensive. Now that they're making money, now that they're emerging as the big winner, which they are, they understand that they will need to keep moving into sports. It is a matter of time.

The games for this coming Christmas, it's a pair of them, Chiefs, Steelers, Ravens, Texans. Those are the two games. Both pretty good games.

Does it matter? But that's the question. That is where my head. They wanted to do this first Christmas. They wanted to just eliminate the NBA. Move on from that. Don't even have them as competition.

Who's they? I think I know, but- The NFL.

The NFL, for me, they're going after Christmas. This is new. It used to be they would only do Christmas Day games if Christmas happened to be on a Saturday or a Sunday or a Monday night, maybe, or a Thursday night. Now, it doesn't matter what day Christmas is, a day that used to be NBA-based is now going to be won by the NFL. The Netflix ratings will be higher than any of the NBA ratings, even though it's a streamer, Netflix only. And the NBA, in theory, will have its Christmas games on regular networks. I still think it'll beat it. And then it'll just start to... Netflix will continue to spend more money in this arena. And so my question, as I was thinking about it, is, are they now out of the event business? All these tennis matches they do and the golf matches.

Event versus games.

Event versus games. A one-off versus a series of deals that they're going to do. If I were to wager, I would say that they will get away from the one-off events which are harder to make work financially, and they will go into the larger deals like this.

Yeah, you did condition it on, they'll go away from the ones that don't make money. I don't think it's either or. I think they will continue to look for one-off events, and they proved quite successful in that, and things other than sports as well, comedy, and they'll keep doing that. There's no reason not to. I mean, Netflix is now interested in share. They're going to continue to try to grow share, and they know this will help them do that and retain their subscribers and grow their subscribers worldwide. It all seems very smart, very logical to me.

The fact that they got worldwide rights, it's not being Just enough, I feel. That means that wherever you have, if you're traveling and you turn on Netflix, you know you get different options of what you can watch. Not all movies are available, whatever country you're in. The NFL deal, I believe, is going to say that wherever you are, if you've got the red N, then you are going to get the NFL on Christmas Day in whatever time it is in your particular country. That turns out to be big for Netflix, of course, but really good for the NFL who spends a lot of time time, energy, and money trying to expand internationally.

Yeah. Were the NBA games international as well on Christmas, they would win the ratings.

But they're not.

I know. I'm just pushing back to you. I also don't think it does. The NFL, wherever it appears, affects ratings of the other outlets at the time. The NBA will still do fine. They have five games on Christmas. You said correctly, they own Christmas. This does provide some incursion into that, but they'll do fine. I don't think they'll move them to the 24th or the 26th.

Well, Christmas is Christmas. No one can move Christmas. But it used to be that the league respected each other, I feel a little more, when I first got into sports. We always felt we were in competition with the NFL, and Bud Seelig was always wondering what Tagliabou was doing. But now it just feels like all-out war where Roger Goodell is, and I may have said on this show or nothing personal, he truly yourd of the turtle. He wants to rule everything that he sees, and he doesn't care about the other sports the way I feel they used to.

Look, it's just good competition. I do think there was a courtesy before. It doesn't surprise me in a world that's becoming less courteous. As rights fees go up, they have to figure out more and more ways to drive more money for the owners. It's going to happen. I remember at ESPN, when there were people who thought our being on Thursday night with college football was a bad idea. We stayed off Friday night because of high school. But at some point, it was like, no, we're going to put college games on Friday night, and then we're going to put them on Tuesday night and Wednesday night. So it speaks also just to the insatiable appetite that sports fans have. They want an opportunity to watch sports all the time.

It's fascinating, Pablo. I don't know if you saw this the other day or whatever day it is today. There was a discussion from Bob Iger, our old friend Bob Iger, who was saying, We're not going to put as much money into our linear programming. We are going to really focus on streaming. We're going to focus on getting that content and that production value up. I was thinking from a business standpoint, what has changed and how quickly it has changed. That we talked about on this show maybe a year ago that Netflix was not in this business. And not only are they in the business now, they're owning the business now. And we didn't imagine what could happen with NBA and its rights fees, which we may get into today. The The world that we thought was changing quickly, it turns out we were wrong. It's changing even faster than that.

So the coursening of relations between the league, which was a gentleman's detente, it sounds like, John, before. What accounts for why that is different? Now, Is it because, look at the media economy and the icebergs that are melting and the ones that are seemingly bobbing up to the surface, is that why all of this now feels more all out?

I think it's because of the price of entry. I'm sorry to interrupt you, John. I think that when owners had bought a team George Starbent or bought the Yankees for $10 million, it's okay to be a little cordial. When your entry price is $6 billion and that's your basis, then you have a need for a higher return and for increased revenue because you are servicing more debt. In the early days, the acquisition debt for teams was minimal. Now, the acquisition debt can be in the billions.

John, before we get to you, explain what that means, though, servicing debt, acquisition debt in layman's terms.

When you buy a house, you borrow money to buy your house. If you buy a bigger house for more money, but your down payment stays the same, that means you're borrowing more money, which means you're paying more money per month to the bank who gave you the money. When you buy a team, it's the same darn thing. You put an amount down, and then you borrow the rest from a bank which you have to pay back. If you're borrowing billions of dollars, it can change how you operate. We see this with companies like Warner Brothers. When the debt, like Paramount, when the debt becomes so overwhelming, you can go bankrupt or you can adjust and cut your expenses, but you have to do something.

I think that's accurate. I think it's also accurate that there's rights fees go up. They've got to find new places. Sports is by far the most predictable and consistent driver of audiences, the only driver, other than a few events, Academy Awards, Tom braided Roast, that you can predict and get you a concurrent large audience. So they're just looking for more windows. And now it's harder to be a gentleman or a gentlewoman when you are trying to find more windows and you're going, I'm not really going to honor that anymore, that we're not going to play college football games on Friday night. We're going to play them.

Right. Peacock, let's recall. We've covered the story, too. Peacock setting that record. 23 million viewers for that Dolphins Chiefs game, a streaming playoff game, the first ever exclusive to a streamer. Really, it seems being the proof of concept. Is that the way you guys see it? For Netflix to say, now it's time for us to make sure that we gobble up some of this.

Can they do it after one? Is that proof of concept to you? If someone brought you one success.

Well, Thursday night football is a proof of concept as well. People thought you could never aggregate the NFL audience. I would suggest that Pablo is right about the wild card game because that's a postseason. That would have been sacrosanct territory that the broadcast networks would have expected to hold. They're not going to. There is one other interesting fact about these, though, which is these long-term deals.

Which are?

The NFL deal was 10 years. But you have the recollection of that, right?

Are you talking about... Did you mean the Netflix deal?

No, the Netflix deal is three years, which is interesting. But I am suggesting that as Netflix begins to come in, they're already locked out of a bunch of stuff. If they don't get an NBA deal right now, they might likely to-Because John locked a bunch of them up. No, my locking up is gone. No, but your strategy, though, was, in fact, to look so deep into the future that you had these assets for a long-ass time. It was. I do think the other interesting thing you have is the rights holders should always have wanted to do short-term deals because the more often you get a chance to come up, you do it. Now the rights holders are going for longer term deals because I think they're worried about the disruption of their traditional partners. I think you'll see now that they're moved to something like what the NFL did, which is get an option to get out if they need another crack at it. Before, it would have been the buyers who would have wanted an option out. If the buyers were to lock in, if I was ESPN, I would want to get as many years on the NBA as possible.

That means nobody will get a crack at it. We did a nine-year deal because we didn't want anybody to get a crack at it. We also knew that every deal that's expensive at the beginning is really cheap at the end.

But what the league do, and you've seen it with the NFL and even with these new deals, the league still has inventory. We would sit in meetings and talk about what are we holding back? If worse comes to worse, we'll put it on MLB Network or we'll put it on NFL Network. But we're going to keep games back because we need to have more to sell. What a dream when you can play football games on every day of the week because then you can spread it out. And now there will be platforms that suffer. And coca before the show mentioned, what exactly did YouTube pay for when they got the new zone from direct TV if all of a sudden, games are in national windows every day of the week? And so there's going to be some change in terms of value, but overall, it'll be increased because I assume the NFL is going to go to seven days a week.

Before we get to fan perspectives on what they now need to do to watch these games. I do want to go back to Ted Sarandos, who's the co-CEO of Netflix. We've been talking about the macro of this, and Ted Sarandos said this in July 2023, We really think that we can have a really strong offering for sports fans on Netflix without having to be part of the difficulty of the economic model of live sports licensing. That was a second quarter earnings call in July of 2023. Is that now looking Yeah. What does that say to you now?

Every earnings call is different. And earnings calls are like when managers meet the media, you're only responsible for what you say that particular day, and it can change the next day, and you can keep your job. And Netflix clearly has a different view, much like when we talk about Tur in the NBA, if they try to bid over two and a half billion, then David changed his view. So I'm okay with that being different a year up.

Yeah, that was third quarter '23, did you say?

Second quarter '23.

Second quarter. They had a third quarter, a fourth quarter, and a first quarter. I'm not positive of this fact, but I suspect their earnings went up every quarter, and consequently, they're in a different position, and you adapt in a different position. Totally normal. As David says, he was telling you their position in the second quarter '23, it's clearly changing.

How do you guys see Netflix as an entity compared to Amazon, compared to Apple, when it comes to their potential to just outright be the winner of, now, let's call it the evolving economic model of live sports licensing?

I don't see those three, any of those either going away or merging themselves away. So I've always thought of it as a three-legged stool with Apple and Amazon and Netflix. I've always been concerned and thought about the other streaming networks and how they'll all consolidate and where they will end up being owned. We've started to see some of that. But what is interesting is that Netflix and Amazon, what is happening differently, they all have different risk tolerance over what they want to do. I would argue that what Netflix is doing with the NFL, there is no risk involved. What Amazon did with the Yankees, there is greater risk. What Amazon did with Thursday Night Football, doing it every week, there was greater risk. Netflix is still, I view them as the most conservative, but I don't view them as a candidate They got it to have a problem.

Well, I agree with that, but I'd look at one thing that's different as well. Netflix is a pure play. Netflix is an entertainment company. Amazon and Apple are not, at their core, entertainment companies. Their other business provides them with one advantage. They have a whole lot more cash than Netflix does. On the other hand, Netflix has to win at the core business, and Apple and Amazon don't necessarily have to win at the core business.

They have to win at their core business. Yes. Amazon's core business. Netflix started sending people CDs.Dvds.Dvds, excuse me. You had to return one to get another. I think Netflix has clearly evolved into a media content company. Would we be shocked if Netflix continued to evolve and maybe started having different offerings to its subscribers?

I assume they could, but it still feels to me like it's a pure play and they want to win. They know Amazon and Apple have the amount of cash and market value. If they wanted to, they could outbid them for anything. I think you'll see by some calculations, and I'll cite Lucas Shaw in his Sunday night newsletter. At Bloomberg. Yeah, at Bloomberg, did calculate that on hours watched, Netflix has more than half of the total hours. So they are winning big. I think this is a story worth our talking about sometime, too. They are winning by a huge margin right now in terms of people's entertainment time. I think 75%.

Well, that's why I call them Goliath at the top is because in all of the streaming wars, when it comes to just actual tonnage of viewership, Netflix is clearly the winner. I want to point out that they're using that tonnage to then pay about $150 million for those two games for this year. Look, what we're looking at now, now speaks to a larger concept we've been talking about on this show for forever, which is what the consumer had been promised when it came to how this was going to go for you as a football fan, because I'm looking through the list. Okay, if I want to watch NFL games, I need to have an Amazon subscription, I need to have a Netflix subscription, a Peacock subscription, ESPN Plus, Sunday Ticket, perhaps via YouTube, and then, of course, access to the big broadcasters.

I'm so tired of this narrative. It bore me. I'm sorry to all the people who have to get all these subscriptions, but I remember when I couldn't watch a movie because I had HBO, but not Cinemax. Cinemax, but not Showtime. It was just life. There is no God given right to watch every NFL game. All the people complaining, Oh, woe is me? I need these many streaming channels. Give me a small break.

I do note, Pablo, you said they were promised. Who promised?

By who?

They weren't promised by ESPN. We were-Or Roger. Busy raising our hand going, You're going to regret breaking the bundle up. I don't know, promised by whom? Rich Greenfield. I promised them that they would get, that it would be cheaper when they got choice.

The promise of disruption, the promise of now you pay for what you want and here it is, and suddenly it's going to cost. I mean, David, as much as you are right in saying that, of course, it has never It has never been, I guess it's always been weird in terms of what you can and cannot access based on your assumptions as a consumer. Now it's just that much more decentralized is the point. Literally going to different apps and devices.

But I believe that people have been trained their whole lives, that there were certain things they have access to and certain things they don't. We can take this all the way to who flies first class and who flies coach. Who gets the suite in the hotel when you're a traveling team? There's just things that are. To complain about it, be a better player. Negotiate it in your deal.

Be richer is what David is yelling at the American public.

I think that it speaks again to how passionate- That's going to come out.

That's just terrible. Can you cut that out?

I think it, again, speaks to how passionate people are about sports. To be fair to them on the NFL, wait a minute. To be fair to them on the NFL, Roger Goodell, not more, I don't think, than three years ago said his intention was to continue to put all of his games on national broadcast networks, which are available for free.

We just said things change.

They did. I didn't say it was wrong. I just said, if you're a sports fan, you just heard three years ago that you're going to get them all for free. But again, Roger didn't the American public, and that will happen forever.

I own a share of stock of a company that is doing well in the third quarter of '23, and all of a sudden, it does not do as well in '24. Do I get to call the CEO? I could do a proxy fight. I could try to get them removed. But let me tell you, there's no guaranteed past performance is not indicative of future results.

Okay, so David Everde, the litigant, you're right that there is no lawsuit, no class action suit on the basis of this alleged promise, a term of art, a figure of speech that I used for the expectations that sports fans have had forever, that this thing was going to be a thing that they could enjoy in ways that didn't feel exploitative. I now just wonder if it's going to get to a point, John, where it feels like I just want to watch the games without being charged by every single tech company in the world.

I don't think it's going to go back to that. I don't think people are going to quit watching, and I don't think people will stop complaining. I think that's a It's a constant factor, too.

You are seeing bundling. What you're seeing are companies trying to say, All right, I know that you're going to have to get Netflix, but let me tell you, not only are you getting Christmas games, but you get every Kevin Hart movie ever made. You're going to get Happy Gilmore 2, to T-W-O, T-O-O, and you are getting all this benefit for Netflix. Amazon, you're going to get a game, but guess what else? You're going to get toilet paper, and it's going to get to you tomorrow, and it's going to be cheaper. I think that what we're seeing is companies trying to explain to consumers why it's okay to do business, which is why, John, I believe that Netflix is not going to be so pure going forward. I think they're going to look for different revenue streams to get more money out of their subscribers.

The movement here, the evolution, is actually in the direction of everything old being new again. Because, by the way, guess what's coming back, too? Commercials, advertising. I want to just explain for everybody what it means when these tech companies are experimenting with live sports, with live events, which means, by the way, advertising. John, explain what's happening here in terms of the great return to advertising, broadly speaking, I guess.

Well, I'm not positive it's a great return to advertising. An extraordinary amount of ad revenue is now going to a few technology platforms. I'm not sure I understand yet, but assuming they have more data, which they do than anybody else, they will actually be able to charge more money per ad than anybody else. All this means is that more and more money is going to move over to the big tech platforms. I'm counting Netflix there as a tech platform.

I think what's coming is not ad buys that are general ad buys. They're going to be so targeted. That's the evolution that we've seen. If anyone has social media and you look at your feed, there's a reason I have 17 carry-on suitcases and 49 toiletry kits because I buy them and then they keep bringing me the best one. Here's This is the best one. That targeting advertising, I would think that the least- Wait, 49 times you decided to upgrade your toiletry kit? What's going on? Because of the way they hang and the different Zipper components and it doesn't drip and you don't have any leakage.

This will separate me and David, once again.

Because you don't use a toileter.

Loving friends. I use one of those plastic bags. Do you really? It's so disgusting. To put my two-face to your- It's so disgusting. In one of those plastic bags.

I can't tell if you're joking or not, but that's gross.

No, that's what I actually do. I thought you were supposed to do that, David, in the airport. You got to have one of those clear bags.

I never take my bags out. You have a toileter kid? Yes, I do not. But in any case, the point is, thank you for, again, illuminating how gross you are.

It's not gross. It's transparency. It's true. It's literal transparency.

Yes, it's literal transparency. Thank you.

I'm excited for what I have been calling the minority report age to happen, which is when you walk into a store, they read your eye and say, You have not bought jeans with your size 29 in six months. Walk to the left, we've got pair of jeans for you and your size.

I think we are-Assuming you didn't lose weight or game weight.

Well, they're looking at you, and yes.

Yeah, leakage accounted for. But hold on. I want to give a quote here from the ad chief at Netflix who says, Bringing our ad tech in-house will allow us to power the ads plan with the same level of excellence that's made Netflix's leader in streaming technology today, which is to say that the company is building an in-house advertising technology platform, giving marketers new ways to buy and measure and monetize the American mind.

I'd like to say I saw that quote before I talked, and I had not, but that's what I was trying to say, but much less eloquently.

That'll be great. We see what other businesses they can run. They run the newspaper publishing business out of business, the magazine business out of business. I don't know what's next. Radio, maybe.

I mean- But did you complain about typewriters being out of business? This is just progress. No.

Well, we don't want to get into here, but you do reach a point where the Justice Department at some point is going to have to decide if two or three companies owning I'm 75% of the ad market is a good idea.

Correct.

I personally am not looking forward to having my eyes read when I walk into a store and being told what to do.

But we're no longer catering to people of your demographic. Well,that the world is not.

So it's not about- That was always accurate. It's always been about 18 to 34-year-olds.

And the problem is we age out of that, but there's always 18 to 34. And so what you're saying you don't appreciate is companies, and I think you'd agree with this, They're okay with that. Yeah, I read it.

Actually, I think maybe Scott Galloway said this, which is people just think they want choice. They actually want to be told what to do. They want to know. They want the computer to tell them what song to listen to next, what movie to watch next. I deliberately, if I get any toy bag kit upgrades, I do not buy it. Because I'm not going to be subject to that. I thought you were going to say- I'll be the last holdout.

Can you imagine him when they ask for recommendations when you watch something, you're supposed to give a thumbs up or thumbs down as a way to help the algorithm send content your way or ask your way? I never do that. Dude, you lie?

Who are you fooling? That's a good idea. Why? No, I just ignore it.

He's a conscientious objector.

What I'm amazed at is every time I make a damn telephone call, it says, rate this call. I mean, rate it based on what? I just had an argument with somebody. That's a bad call. The sound quality, the what?

I hit not now. I hit not now when I'm given that.

Well, only because you have to.

You have to hit not. I am You're suddenly very concerned that both of you are regularly being hacked.

You don't ever get those? Wait, am I the only one with you gets the alerts after a call? No, I get these all the time, yeah. With the app and I write not now, you're fully.

He may know actually how to block that, right?

Yeah, I'm not necessarily encountering your problems of technology or leakage at this rate.

Wait, I think that's inappropriate to discuss David's leakage.

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Dan Levatard.

Go Peefee. Stugatz. Go Peefee. This is the Dan Levatard show with the Stugatz.

Speaking of what is being leaked, The great rebundling proceeds apace. You have all these corporations now signaling, guess what? We're teaming up. And so we've had, okay, let's start with the Remembrance of the Sports Bundle. And that was ESPN and Fox and Warner Brothers Discovery saying, Hey, you want sports? We're going to give you access to the channels insofar as they have sports on them. That was what we talked about before. Now we have a Disney Plus and Hulu and Max combination, a Triumvirate. Then now also we have Comcast doing a Peacock, Netflix, Apple TV thing. What do these things resemble to you guys?

Well, to be clear, and we've talked about this before, the first bundle is nothing but a smaller cable bundle. It's streaming, but it is linear channels. Let's not call it a bundle.

I agree with you.

It's a sports bundle of networks.

I guess we don't agree.

Well, we didn't agree on not calling it a bundle. We agreed, but no. So the second one is really just the Walt Disney Company, which you can already buy a Disney plus Hulu bundle, also giving the chance to get max for another discount. Peacock, I mean, Comcast, this is actually the competition for the pure entertainment companies that want to flee the distributors. They want to be direct to consumer and go straight. And Comcast is protecting their business. But you need a Comcast service at some point in order to get that bundle. You're still staying within Comcast.

You have to be within Comcast. You have to be a customer. So the last bundle you described that everyone is all excited about, it's only available if you do business with Comcast prior to doing this bundle.

You and I are running into different people. If you're running into people who are excited about that.

We definitely travel in different circles. My circle is hugely excited.

My day has been made because I'm a Comcast subscriber, and I can now add, what can I add? Netflix and Apple TV.

There's nothing that David Seltz's network loves more than an upgraded carry-on suitcase and the It's a streamer saver bundle that Comcast has to bounce. Oh my gosh.

Streamer saver. I'm going to go into business to help name things because- You don't like any names. Streamer saver sounds like a lightweight RV. I'm in the streamer saver. What does that mean? Are you saving streams? I think it means you're saving money by streaming.

Yes. Brian Roberts says this, The goal is to, add value to consumers, and another quote here, take dollars out of other companies' streaming businesses.

Yeah, so That's the competition between... They are a streamer, but they're also a distributor, and that's where they make most of their money.

So Comcast as not... We talked about pure media plays. Comcast is not that, right?Comcast sells you internet. Everything. And sells you cable. And so what does that make Comcast when we think about all of these castles in this now map of sports rights?

Well, I think they're a pillar. They have content as well. I mean, if you ask me to name the pillars we said before, Amazon, Apple, Apple and Netflix, I think there's another group of behemoths that you would call Comcast. You'd have to call Fox in that genre, and you'd have to look at Spectrum in that genre. But Fox is one of your companies.

I'm not sure. That's interesting, David. Fox is interesting, and we should talk about them. I thought you were going to go to, They're the three behemoths, and then which of the traditional companies are going to make it? To me, because of the brands and the content they have, Walt Disney is a pillar. To me, because Comcast, two-thirds of their revenue and cash flow come from their non-entertainment businesses, they have the cash flow, lack of debt that means they will survive. You get to Fox, See WBS, WB, Warner Bros Discovery. I'm not sure they are pillars. I'm not sure they can survive, including Fox, which has no streaming plan. Fox remains a pure play linear business. I think all they're going to do is, once again, they're the best people in the world at making money in some ways. They sold a lot of assets that were in declining value. I think at some point, Fox will be sold because they're not built to last into the digital streaming age.

Well, it also could be a function of Murdoch dying and the kids wanting to- Are you suggesting he's dying? So are you. Act accordingly. So are I do. Everybody listening is, too, but we can talk about that later. I guess I would like to make the point about these companies, Paramount as an example, and caveat, I do work for CBS Part as well, but they're struggling. A lot of debt. Skydance, that deal fell apart. Sony, that deal could be falling apart. The question is, what will happen to Paramount? Will all of these mergers that have happened in that business, now they're being broken up. In the streaming world, we're only at the merger point. After the merger point comes the breaking up point when you find out who can make it and who can't. To John's point, we're only in the beginning of seeing who wins, and we can't declare Netflix the winner yet. But it's going to be fascinating what will happen and how quickly it will happen. I got a prediction when we do predictions later.

Well, David Zaslov says, It does feel like this is a moment in terms of what the next year, two years will bring. Referring to this restructuring, the business looking a lot different in 2-3 years. He says, It'll be a lot better for consumers. Another non-promise that sounds like a promise, but I digress. When it comes to what alliances are being forged, is it surprising that these are the alliances? Okay, Disney, Hulu, and Max, of course, Disney and Hulu are part of the same thing, but Disney and Warner Brothers Discovery, is that surprising to you guys? Is the fact that on the other side of things, it's Netflix and Apple TV and Peacock getting together? I'm just curious about the tribal, to borrow survivor language.

I was just going to use the I was going to talk about alliances.

As the first person voted off his season of survivor, David. Thank you. What did you learn about these alliances?

In the old days, there's something called the old era, new era. In the old days, you formed an alliance and you stuck to that alliance. That was your group, and you rode them through thick or thin. In the You make a new era of survivor, you make an alliance, and then it changes every day. You have a new group who you're loyal to, and then you make a move, and then you get a new group. I think that that's what media companies are doing. They form alliances, they announced them, and then they're already moving on. Because right now, Turner is a great example. They are fighting cats and dogs. Can you fight cats and dogs? With NBC over the NBA deal?Cats.

And dogs rain, and it rains cats and dogs.Yeah, that's raining.Cats and dogs.

To fight, I can't remember the expression. I'm not a futurist.It's.

Raining cats and dogs.

Tooth and nail is the expression, coca. Thank you. They're fighting tooth and nail over MBA rights.

Your brain is such a fascinating place.

In fact, they could end up, Can you see a world where David partners with NBC in another issue?

You could. I think is, the alliances you're seeing right now, Comcast benefits if the TV bundle stays together as long as possible. So I don't think they're going to make an alliance with their streaming service that hurts their underlying business, which is actually more valuable than their media business. I think you're seeing the traditional media companies that don't have cash flow from other things getting together just because they need to.

They get big enough to win. Netflix doesn't have cash flow from other things.

All Netflix has agreed is that if you're a Comcast subscriber, you can buy Netflix through Comcast and maybe save a buck or two. That's all it means.

It means that you're doing a lot of different deals.

My guess is Netflix would do that deal with these other bundles. They just want as ubiquitous a distribution as possible. They, in fact, are the new linear network in a way, in that they just want to be in 100 million homes.

What's interesting is that if that's Netflix's goal, they're going to get there through acquiring content, which they're starting to do with the NFL by producing content, by being a studio of content, and then by buying other people's content. It used to be they thought they could just do other people's DVDs. Then they started doing other people's movies, and they said, Wait a minute, we got to do our own movies. Then they started that, and now they're up to the sports part where it's, Hey, we'll make up a sport. That's the golf and all that ridiculous tennis and all the stuff. Now they realize, All right, we can't I do that. Let's go now to the brick and mortar. The brick and mortar is actual rights deals.

Yeah, I think that's true. I actually think Netflix has a chance to remain a pure play. It's always the case that if you have subscribers, you're going to try to figure out other revenue streams. But I think they have benefited from a real focus on a long-term goal that some of these other companies have not had.

In the way Fox benefited from not doing streaming and now could end up being sold because they're so far behind and screwed up.

They get sold for so much money. They sold off some parts for $71 billion, right? They are continuing to earn a lot of cash. They're really a family-controlled business. I think they'll-So it's paramount. I think they will be enough money to go around, even if they have to for many, many generations, even if they have to sell.

That's not the question. Again, you're putting your slant on this conversation based on your thoughts on distribution of wealth. It's not a question of how rich the Murdoch will get. It's a question of what is the value of a company and what keeps the value growing. What you heard Zaslow say is, Oh, it's going to be great for consumers in the next 2-3 years. He's totally full of it. Nothing he does with the consumer in mind It's all for the shareholder.

That's actually, and I've learned this from you, that's his job.

That is his job to worry about the consumers. I agree, but I don't want to be fooled. I don't want the audience to be fooled, precisely. That everything's going to be better in 2-3 years. Just you because I don't agree with that.

No, it's going to be if expensive is worse, and for most people it is, it's going to be worse.

What is expensive?

Isn't it?

Expensive is only better if the value outstrips the increase in the expenditure.

And if you can afford it.

That's less than relevant.

This feels like a riddle that only rich guys can solve, by the way. When is it better to pay more for something? It's like, well.

There are people who go to the grocery store and decide between different brands that are both both lesser brands, but one may be more expensive. And they're making the decision, is it worth it to buy the Jolly Green giant pees or the whatever other kind? So I think that everybody does this, Pablo, but thank you for another only rich people joke.

I mean, look, we're Rich Guys Only fans. This is how we operate.

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Dan Levatard. We love you. We've got you. We've all got each other. Let's go right now. Stugatz. One, two, three, Brett. One, two, three, Brett.

This is the Dan Levatard show with the Stugats. I want to get your feet and your caps. I want to get to what David Zaslow is saying when it comes to the changing tune he's had around the NBA, as he once again shows up at Madison Square Garden with a Knicks cap that looks about 30 minutes old. And he's sitting there grinning, and they're saying at their upfronts, and this was another executive at Warner Brothers Discovery, saying that they look forward to another season of the NBA and coming to an agreement with the league that makes sense for all of the parties. And meanwhile, John, I need your understanding of what it is that they even have the power to do when it comes to this matching right, because Zazlov and WBD have made noises about how they can match, apparently. Comcast US bid or Amazon's bid, and you're the guy who happened to sign the existing deal.

What's going on? I did sign the existing deal, and I do not believe it had a right to match. We negotiated that deal at the same time that TNT did negotiate their deal, and they were close to exact other than the exact money or the exact games. So I am puzzled and don't understand how they could have a right to match. And I really have a hard time understanding how they could have a right to match Amazon because that is not even the same package. You get a right to- That's not the incumbent. Yeah, you get a right to renegotiate your own package, an exclusive negotiating window. I never had much luck getting a matching right because that dramatically decreases the rights holder's chances to get the most money. I'm puzzled. I do not believe we had that right. I do not believe TNT had that right, Which would mean that subsequently, somehow, when there was this consolidation of these assets into Warner Brothers Discovery, they got the NBA to agree to let them have a matching right.

I don't think we need to tell people in the booth what to clip because basically what he's now saying, just to make sure we're getting it everywhere, what John Skipper just said is that what Turner has been doing for the last two months is lying.

No, I didn't say that. I said, I'm puzzled because to my knowledge, that is a difference. There is a question- I'm simply telling you, based on my knowledge, I am not accusing anyone of lying.

Do you think Turner has a matching right, yes or no?

I'm not in a court of law.

I love when we get to the deposition phase of the show.

I'm trying to make a point here, John, and you're not letting us make it.

What John is saying is that intent-I'm an excellent witness. Exactly.

I heard that.

You've experienced in these matters. I am, too. It's not for me to accuse anybody of mendacity, but I'm puzzled by it.

Puzzled because you have signed a deal that is supposed to be quite similar to the deal that they are also working with- And doesn't have a matching right. And doesn't have the thing that they say that they have.

I can't be privy or read anybody's mind as what may have happened subsequent to those signatures.

You make me smile. You really do. I can barely deal with you, but you make me smile.

The question here, David, is The question that John cannot answer and will not answer under oath or otherwise is, why are they saying this? Because it does not seem to be true.

What's worse is if they're saying it, and A, they don't have it, or B, they can't match it, which is where it looks like this is going, that MBC is going to get this package. It just makes them look worse. That's my question. What's the strategy? I don't know their strategy here. Clearly, it's going to have to come out when the announcement's made. What you heard at the upfront, it's really not outstanding to say this during your upfront. Of course, they have one more year. That's how long the deal is. They've got one more year in their deal. That's not news that you would give at an upfront. That doesn't get anyone excited about anything. They had Barkley and Shaq not in studio last or whenever night it was because they were doing the upfronts for Turner. But to say what? That we have another year and we're excited about it? You could have delivered that.

They will do good ad business in the next year, and they're just reminding the advertisers in the audience not to change their budgets yet.

It's a great point about what the upfronts are. People-yes, let's explain that. I've never seen upfronts get this amount of attention as they're getting recently with... I think Jason Kelsey was doing an upfront, and Tom braided announced what the game was that he was going to start with Brown's Cowboys. Upfronts are when you are giving a sneak peek to advertisers, what's coming next and why you should be budgeting, because they're all doing their budgets for our stuff.

They're completely unnecessary now, by the way. They're mostly a factor of people still wanting to get four or five days in New York City.

It's amazing. It's a boom dog.

To come see a few shows and see the Knicks and Rangers play because it started with the networks who, of course, released a whole new season every fall. They would have half, a third, 40%, 60% of new programs. They would come in, show you clips of the new programs, and say, Here's where you need to put your money.

Introduce you to the stars who are going to be in the new programs.

It was a world in which there were the upfronts, and then the agencies would commit their money. They would sell, Oh, MBC, we're going to commit $86 million out of Doyald Dane and Bernbach to your programming. That's why you did the upfront. Now, the decisions are made every week, every day. I don't know if anybody is actually guaranteeing Turner anymore that they will spend X amount of money during the year. They probably are a little bit.

If it came across my desk to pay for any employees to go to upfront, I would deny the expenditure. It is a simple just ask for vacation days and take your vacation. I don't know what business is being done.

They're pretty anachronistic. I mean, there's not really much reason for them, although I am a lover of New York City, so anytime a whole bunch of people come, I can understand the appeal.

John would approve those expense reports. Yeah.

He wouldn't even look at them.

Well, look, the hard problem now is, do you want to be the company that doesn't do it? So everybody's in town and they're going around to see.

That's what I was going to ask, in terms of all of this being a measuring contest, an ego measuring contest, it feels like you do it because everyone else is doing it.

It's the worst excuse. We Hi, I'm David Samson. All right, I'm good. One year, we did not send anyone to the Major League Winter meetings, and we got in trouble because it wasn't worth the money. We weren't doing any deals. Who cares? I'm not approving anybody to go to these meetings.

You were the only one?

Yes. That is perfect. Then we got in trouble. And unsurprising. We had to send people, so we made our GM drive. We wouldn't fly him. We were making a point to the league, which is enough of this. That's how I view the upfronts. If you are paying for people to go, I understand your love of New York, and I love it, too, but the world's changing. There was a reason for upfronts.

I think there were a couple of companies that tried to stop doing them at some point. At one point, people are also trying to cut back the expenses. The ABCs were always done at Lincoln Center. Jimmy Kimmel hosted. It's a big deal. It's hundreds of thousands, perhaps seven figures in some cases, too. But it still is an average-Of expenditure.of expenditure.

That's what you mean.

The shiniest toys are brought out for everybody to marvel at, the new stars and all of it.

Barkley didn't fly commercial to New York to do the upfronts for Turner.

By the way, we were in Bristol, Connecticut, so our folks did drive. In fact, we usually brought a bus. And Kenny Maine let our upfronts, and he was already on the payroll, so we were good.

So no incremental money?

Did you put him in hotels or did you fust them back right after? No, we had a Broadway stage, and we hired a company to put on the show. Right.

I remember being at one of these one year, and Kenny Maine was, I believe, flying through the air. He was suspended from the ceiling of a Broadway theater.

Like the Spider-Man set? Yes. You're lucky it didn't fall.

It's a very inside reference to a horrible, horrible injury.

It's not that inside. Do people not know that Spider-Man, the Broadway show, people kept falling from the roof and dying, and they canceled the show?

I don't know if they died.

I did not make space in my brain to remember that.

This is a weird thing for me to have to Google very quickly at the end of a show. Don't worry. But did the Spider-Man musical performer, Spider-Man, die?

I believe something very bad happened to a Spider-Man performer in the middle of a show, and that show closed, and I went to that show.

Near death.

Oh, it's near.Thank God.Thank God.

Your spidey sense was slightly wrong.

It was slightly off.

And yet it does tingle all of the time. Anything at the end here that you guys are thinking about on the way out? Because we have two minutes, I believe.

I'm thinking about the NFL, if we have a minute. I am just absolutely shocked and in awe of their strength and of the fact that they are clearly the top league in every way now, and they're not satisfied with being number one. And this Netflix deal is just another example. It's just the beginning. They don't want to own the professional sports landscape. They want to own the whole damn world. And the rest of the league, they better stop trying to play catch-up because it's not going to work. And to me, the fight is now for who can be second in terms of other league because the NFL, I believe they've lapped the field and there's no turning back.

A dire proclamation.

Yeah, you are talking, of course, about the United States of America, because there is another sport which arguably is the biggest sport in the world, and that's what everybody else calls football.

Where teams can't make money.

Where teams can't make money?

They're losing money hand over fist. We can do a whole show on that if you want.

No, that would be an interesting show. There are teams that make money.

Let's put a pin in that, that debate.

You did say everybody's fighting for second. If you're fighting on the international stage, there is a fight, right? And the NBA is in that fight. They are in the fight to be the second most important sport in the world. Not in the United States. The American tackle football is king. And you would argue that in the United States, you were talking professional. You said the word professional. I did. But if you were just talking sports, you make the argument college football is the second largest sport.

I'm happy to make the argument. I understand why you say that.

You can also make the argument that it's professional now.

It is professional. It's totally changed. I count college football as pro football.

It's football.

It's American football, North American football.

And so what you're saying is that if you were running a baseball team today, you would have made peace with the fact that you're a flying coach relatively speaking.

That is a sad but true truth. You asked me what I was I'm thinking about this week, and when the Netflix deal was announced, remember, that's in conjunction with MLB's Roku announcement. There were two announcements. Two different upfronts. Two different upfronts.

If you asked me what I was thinking about this week, it mostly wasn't sports. So it would be irrelevant to this show and probably about time to close it up.

I want to know what you were thinking about.

I can't remember.

That's it, Pavo.

No, no. Mostly, I've been thinking about the Knicks. Oh, there it is. And how damn great Jalen Brunson is to watch. Unbelievable. I think he'sThe smallest guy on the court last night, the most dominant guy on the court. I don't know how he gets those shots up.

I think he's the most popular athlete since Derek Jeter in New York City.Jalen.

Brunson?jalen.

Brunson?yes.oh, he's great.Yeah. He's going to own the city, though the Knicks may not have enough players to beat the Celtics, much as I love them.

He'll own the city, but what about the debt service?

He'll have a lot to repay. I'll tell you that.

David and John, please shake hands so we can end this show.

Oh, my God. David doesn't want to touch me.

You guys are ridiculous.

I'm a petri dish sitting over here.

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