The state of tech media (fact check not included)

0:05Casey Newton:This week on Great Chat, we are talking about the state of the tech media landscape with a very special guest, Casey Newton of Hard Fork and Platformer. I'm Ashley, and this week we are joined by Helen and Sally. This podcast is brought to you by Mercury, the fintech used by over 200 ,000 companies to simplify their finances. We are huge Mercury fans of Great Chat, and we use it to run this podcast. A few of us are also current customers for our funds and startups, not to mention the dozens of founders we've backed as VCs, angels, and scouts that run their businesses on Mercury. If you're launching a startup or fund, visit mercury.com to apply online in 10 minutes or less.

0:43Casey Newton:The onboarding couldn't be more intuitive or delightful. Quick note, Mercury is a financial technology company, not a bank. For details, check our show notes. Hey, guys. Hi. Hi. Hello. Oh my gosh, I'm so excited for this episode because we have our first guest of the season. And when we wanted to talk about state of the tech media landscape, there was like one person we all knew would be amazing. And that is Casey Newton, the co-host of Hard Fork and the founder of Platformer, a tech media company. And so he will be joining us. But first, let's get into some headlines and then we'll get all meta and talk about the industry that covers the headlines.

1:28I love it. I want to talk about the the anthropic settlement because I feel like that's something that we had. We had a little bit of a debate. Yeah. Want a TSI, Helen? Yeah. The summary is that, you know, the headlines were that the judges, you know, they they ordered or anthropic agreed to pay, I think, one point five billion for to settle this. Just a one point five billion. Yeah. And it was class action, technically. Right. It was it was all of these writers. So we talked about like the whether or not this is good, bad, you know, like what is the perception of this and what are the implications, I think, broadly for like other industries?

2:08Because I think one thing I started to think about is like, OK, these are books. Like, how do you what about music? What about movies? What about all? You know, so I think that that's also very interesting as well. I mean, like, this is what we focused on in my last company is, is training fair use is the big question. And that's the thing that, like, Sam Altman and Elon Musk have both been pushing very hard in D.C. And it was a significant case because the headline might say that Anthropic is paying$1.5 billion or they're setting aside for the authors. But the actual, like, the big news is the fact that Judge a few months ago or a few weeks ago had said that training is fair use.

2:44that the books that were legally acquired or legally purchased online and you trained with those books is okay. Because, however, the 1.5 billion that is set aside is because they had illegally downloaded it, meaning they scraped it on the internet and rather than paying whatever it was, how much it was to pay, and then they trained it and then I think they try to cover their tracks by purchasing it post. And so that's the significant sum of it. I think there's also some debate now on if 1.5, they're going to do side deals, and I think the judge is upset about that. But yeah, it's a huge implication on if you can start scraping things or purchase.

3:27Okay, let's say you start purchasing a Netflix clip online legally and downloading and training. Is that going to be fair use because you've legally downloaded? Those are, I think, questions that are going to come up. And then the wider thing around, can you just start scraping, you know, various friends' newsletters and blogs and train it on that?

3:48Casey Newton:Right, because, like, what, it costs maybe, like, to actually buy a book, maybe it costs, like,$10 or something. But you're training on that. Like, they only get that once. The author only gets that once. And so, like, Sally, I feel like your perspective was this was such a legal win for Anthropic and the other LLMs. LLMs. And then the other piece that was interesting is like the PR implications of this headline, like Anthropic agrees to$1.5 billion settlement with like book authors. And Helen, I feel like your take was like, it was a positive PR moment. I was like very much on the other side of that.

4:22Casey Newton:I always thought it was positive. My analogy was like, it felt like they didn't fight it. They were like, okay, you're right. We'll pay this. And my analogy was like, you got a speeding ticket and you didn't contest it. You were like, you're right. My bad. You know, I'll pay the fine. Which I think is also 10 % of the latest, latest raise, right? Yeah. And, and you know, the, the, the, before the current, they've been in this lawsuit, you know, before this current raise. So it's like their, their investors. It was priced in. And so no surprises, you know? Um, and so yeah, my, my take was that they're consistent.

4:57This is consistent with like the anthropic. We are the good guys sort of brand. but Ashley you had a different take or your mom had a different take.

5:05Casey Newton:I just think that's like too nuanced right if you see like the headlines are Anthropic has to pay out 1.5 billion dollars like even if the the the nuance there is they're agreeing to do it versus fighting it seems like an admission of guilt and a penalty for doing something wrong. That's a lot of money you must have done something yeah right yeah and so I I just I just like don't I just think that maybe within tech right and and to be fair a lot of anthropics early customers are tech right because it's like cloud code that's their biggest product and so maybe maybe within tech circles and they're like audience today that matters most people who are and then we're more pre like predisposed to be following something like this and maybe understand the nuance of it and like already have the like oh anthropics the good guy and they decided to do the right thing here after like maybe doing something a little wrong but I think to the like the average person who is seeing this number and seeing this headline.

6:00Casey Newton:It's like, oh, like the big, bad AI company, like really messed up and hurt like these little authors and now has to pay out. And I think, Helen, you brought up a great point, which is just like, we are so in a bubble. And it is so interesting to contemplate how people outside of tech, like even think about what's happening in AI and these headlines are so big, these dollar amounts are so big. Like it's definitely filtering out even to people who aren't yet playing with chat GPT or perplexity or cloud. Yes. Yes. Because 1.5 billion is a lot of money. And then like it was the same week as open AI saying, oh, we're probably going to be $80 billion over our projected costs or something.

6:43I might be getting that wrong.

6:44Casey Newton:But their losses are going to be 80 billion higher than like what they had originally projected. And I think to somebody who is not in tech without all of this context, they're like, what is this? Right. Like all of my public funding for just, you know, our livelihoods are in jeopardy. And it feels like everything is just getting taken away. And the cost of it. I have a pure speculation, but I do think the anthropic$1.5 billion deals, the story is not done. And I again, this is pure speculation, but I would not be surprised if they're doing some behind the scenes deal with big publishers that give them a lot more than what they're going to get.

7:25So I think it's like three thousand dollars per book that that the authors can claim. But I bet you they might be doing something that is going to trump the PR motive around it. They also, the day after that announcement, I don't know if you guys saw, but Anthropic announced that they are supporting SB35, which is the, it's all about the like AI model safety, which is going against like every other AI company that's against this bill. So they're clearly stacking up their PR narrative. And I wouldn't be surprised if they like did a deal with Simon Schuster or like all the people that are, you know, within that ecosystem.

8:04because it's hard to, if you're in the business rooms, when these deals are being done, the thing that is making them hard to do these deals is how do you actually price the quality of the book? Is Shakespeare more valuable than this like new author that just came out, right? But this judgment is saying that every book is worth X amount of dollars. If you're doing the same deal with the publishers, you know, the New York Times might say their content is more valuable than political or, you know, a blog, right? So if you're doing these direct deals, you actually can get better value for higher quality.

8:37So I don't know. I like that, Sally.

8:40Casey Newton:Okay, so we're going to put a pin in it and we'll come back. And for what it's worth, I'm really glad there's an anthropic in the world, like an LLM that wants to be the good guy. And so I hope that they can figure out a way to sort of chart a course forward. Yay. Hi, Casey. Hi, Casey. Hi. Hi. How are we today? Oh my goodness. We are so happy to have you here. You're like our first, well, your first guest of the season, but like our first celebrity guest. Oh, well, I don't know about that, but I am so happy to be here. I am a fan of the show. I listen to every episode. Although, of course, I do spend every episode saying, what is it going to take to get some male perspective on Great Chat?

9:22I'm glad that I can be the person to do that today.

9:25Casey Newton:Wow. Yeah, you are our first male guest. Amazing. It's a huge honor. Yeah, well you have like the weight of all male perspective on your shoulders. So I hope you can deliver. I've always thought that I speak for all males. No pressure. Oh my goodness. Okay, well let's jump in. And you truly are a celebrity generally, but also relative to the topic that we want to tackle today. So one of the things that we like to talk about a lot is the changing media landscape. And usually from the perspective of like, what does that mean for founders and startups who are like trying to build their brands, trying to tell their stories.

10:02Casey Newton:But we thought it could be really fun to pull back and talk more broadly about how the media landscape has changed, what it's like today. Even in just like the past few weeks, there have been, you know, big headlines that are really emblematic of the spectrum of like what is happening in this ecosystem. So on the one hand, Financial Times is shutting down the next web, which used to be like a very sort of high output tech publication. A lot of great writers came out of that. And at the other end, the Free Press was just acquired for$200 million, which is pretty phenomenal. And they've been around for how long?

10:38Casey Newton:They've been around for three years, two years, Free Press? Yeah, I mean, I think it was like a pandemic Barry Weiss departure from New York Times. So yeah, it can't be more than like three, four years max. And that deal three years ago would have been like unimaginable. Has that actually been announced? I saw that it was like sort of on the precipice of closing, but I didn't see that it actually happened. Oh, well, this is what happens when you bring a journalist into the group chat. Casey, we don't know. We're not fact-checking. Real-time fact-checking is good. All right. Well, we'll put that in the show notes.

11:10Casey Newton:And then, Casey, the platform you started out on, platformer, Substack, is now a unicorn. AI, meanwhile, is like gutting web traffic from search. So these are truly wild times. And, Casey, one of the reasons we're so excited to have you is like your career in tech journalism feels like a microcosm for this shift and for this change. You and I first met when you first moved to San Francisco way back when to cover tech for the San Francisco Chronicle. You were at The Verge for a long stretch. You started your first newsletter there when newsletters were like just starting to take off. and then of course you launched Platformer, your media company in fall of 2020 which now feels like a long time ago and we are huge fans of Platformer we regularly cite you as you've probably heard in our conversations and then you also have a wildly popular podcast with Kevin Roos of the New York Times called Hard Fork so maybe that's the perfect place to start because it feels like newsletters and podcasts are maybe like the only media format that's like really working right now.

12:18Casey Newton:And I'm, I don't know, I'm so curious, like, why, why do you think that is? I think at the risk of using an overused word, there is something that feels very authentic about a great podcast or a great newsletter. I think that most of the mainstream media products out there, although they're great at a lot of things can come across as not having that same sense of humanity. A lot of news stories are very brief. They don't try to make sense of events for you. Sometimes it just kind of feels like a set of facts. And I think given how overwhelmed we are all day long by information, we crave something that's going to come along and tell us, how should I think about this?

13:00How should I feel about this? I want to spend time with somebody who I like, who kind of guides me through it. And I think Newsletters and podcasts are just amazing at that. Casey, I feel like, I think you and I met when you were living with Kara Swisher, and I went over to her house. And when you were starting Platformer, were you, like, how did you position that newsletter? And has that changed over the years to today? Yeah, I mean, I positioned it as a newsletter at the intersection of tech and democracy. I think it has always been really interested in how do social networks and platforms change the world around them.

13:39The sort of initial seed for me writing a newsletter at all was the backlash against Facebook. As you guys know, that eventually grew into a backlash against the entire tech industry. But it has changed. You know, Platformer is about to turn five in a couple of weeks. and in this moment I think of it as being a newsletter that still covers tech and democracy and social networks but it's really about frontiers in governance we have all these new amazing technologies that are filtering down into seemingly every surface of our lives how are we going to govern those how are we going to regulate those how are we going to make sure that those are safer people and create the world that we want to exist so so yeah it's definitely involved something you just said about personality, it was really interesting because I feel like, you know, we just met, but I've been following you for a long time.

14:25And I feel like you do a really great job of actually before, you know, there were these, you know, sub stack or podcast personalities that you actually did a very good job of like connecting with your reader. How does that work today, you know, inside the newsroom? Because I feel like you were a little different. And that's kind of how you stood out. Now I feel like there's immense pressure within newsrooms in these more traditional, you know, sort of institutions for everyone to brand themselves. And that's actually a recurring theme on this podcast on like, how do you brand your, you know, corporation or entity and balance that with like, you know, your own personal brand.

14:58So how do you think about that today in this context? Yeah, I mean, I tend to think about it less in terms of brand than I do expertise. I think that all of the value in this moment is in having discrete expertise, hopefully on a niche but important subject. So for me, that niche was kind of social networks and democracy. And just by covering that every single day, it was a signal to the world, hey, if you're interested in those subjects, there's a guy that writes a newsletter about that, right? And that was sort of what enabled me to get that initial growth. But when I talk to other journalists or people in all sorts of other professions, I'm always encouraging them to develop that expertise.

15:35Because to me, that's like a necessary prerequisite for having a brand. People want to start with the brand. People want to start with a hundred thousand followers, but if you want the followers, like you have to do the work first. And to me, the work is trying to develop that expertise.

15:47Casey Newton:I don't know, Casey, I think the fact that you're so funny helps too. Uh, people enjoy, enjoy following you, but I love that. It does feel like a shortcut to like, look at me. And we, one of the things we were sharing in the group chat was the wall street journal is hiring a talent coach to work with their journalists to help them like build their personalities and brands on, on yeah, which, really just felt like a sign of the times. Like you used to just be able to be like heads down, reporting out. And now you actually, I feel like it's very similar to what's happened even in venture where like the personal, whether we call it the personal brand or something else, actually maybe supersedes like the firm brand, unless you work at a Sequoia and like people want to, they trust individuals.

16:33Casey Newton:They don't trust institutions anymore. And so even if you're at the Wall Street Journal, the New York Times, your like individual reporter brand probably means more to your readers than like that, that like masthead. But remember, like a few years ago, you weren't allowed to, if you were a reporter at the New York Times or CNBC, you weren't allowed to tweet on behalf of the network. So that's also shifted over the years. So, you know, the newsroom is grappling with this even today. So, yeah. Everyone's grappling with this. Yeah. I think across all industries. Yeah. Um, I mean, this is why I'm so glad that I don't work for a big newsroom full time.

17:13Right. It's like, it's just like a set of problems that I don't want and I don't have. Um, I think newsrooms have been really slow to catch up to this phenomenon primarily, primarily because it's against their interests, right? Like once your reporters start thinking of themselves as talent, they get a lot more expensive and most newsrooms are really cheap. Right. So like, it's interesting to me that they're coming along now and saying, Hey, we're going to get you a talent coach. my guess is that the truly talented ones may still feel like they can make more money by

17:39Casey Newton:leaving the newsroom so we'll have to see that's fascinating yeah it's like literally the same thing that's happening in venture not to keep bringing it back to that ecosystem but like the bigger your brand gets in a platform the more obvious it is that you should go and leave and start your own thing and so it's also very similar in AI companies a lot of researchers are becoming talent on their own and they're tweeting about their research papers and then And all of a sudden that gets attention of the VCs. Mark swoops in with a nine-figure comp package. Again, we won't fact check that. I know that's been disputed.

18:12Casey Newton:Well, maybe like a fun example of like talent and media is TBPN. And the Technology Brothers Podcast Network. And Casey, I'm curious because I know you don't like actively participate in Twitter anymore. And it feels like it's such a like Twitter specific phenomenon. So I'm curious, like, are they on your radar? Like they seem to really leaned into like tech news as entertainment, like personality, maybe even over expertise. What are your thoughts? I think they're super interesting. They have a theatrical quality to them that I really appreciate. It's very tongue in cheek. My very favorite thing that they've done so far is creating the little like player cards and trade announcements when the AI researchers started to move between companies.

19:05It was so perfect because it acknowledged that for a lot of us, following tech news is a kind of sport and they're covering it like a sport. And I think that really resonates with a lot of folks in their audience. So, yeah, I think that's like really smart. It's not journalism in the way that I practice it, but I'm not surprised that it's been successful because I think that their instincts are really good.

19:29Casey Newton:It reminds me a little bit of how on the sort of startup side, for a while, every founder cared about their launch on Product Hunt. And now when I'm talking to founders about what's in their mix for day of launch stuff, everyone wants to be on TVPN. And it kind of happened overnight, which is fascinating. It's like a go-to platform. But Sally, I feel like you're familiar with, in some ways, this is replicating what CNBC or Bloomberg have done for years. And so how does this feel for you? Yeah, I feel like, well, the audience of TVPN, the value of that is that they're really concentrated and they're very deep and narrow.

20:12And so if you are, let's say, an advertiser, which is the business that they're in, the business that CNBC is in is if you're Brex or these companies that are selling into like entrepreneurs it's a really valuable place to advertise versus CNBC which is a much broader audience so they've captured that like very narrow audience really well versus I think people need to remember the audience of CNBC and Bloomberg are much more wider they're everyone from your mom-and-pops that are looking at their 401k hedge fund managers bankers you know people and ag. And I think that's the one confusion that people kind of always compare, like to compare between CNBC and TBPN, that this is the next TBPN, or this is the next CNBC, is that, yeah, it's been able to capture a small audience of that.

21:00I think a kind of a counter argument to where the like broader audience interest lies is if you look at both CNBC and Bloomberg, they've actually scaled back some of their like core tech coverage so like our our bureaus have um downsized that doesn't mean that like overall tech is not important it's just that tech is now across every platform and so rather than being it concentrated on like a very subset of the like venture community it's in dc it's in washington it's it's um it's in every like business so i think that's also an interesting trend in the more traditional media sense? I think it's easy for TBPN to feel so outsized, right?

21:42They are such a big part of the conversation when it comes to marketing and comms. We're spending all day with founders and startups, and it is the new product hunt, sort of like part of the de facto launch plan. I think the thing that I go back to, like I have a marketing background, is I don't know how to evaluate TBPN from an advertising perspective, because it's still CPMs. You're still, you know, you're buying into the sort of like same rate cards that you would compare being on TVPN and the exposure to your audience versus like a CNBC and Bloomberg. And it's like they're not even in the same ballpark.

22:17Right. And so for someone who sits and lives and breathes tech all day, like it's just hard to imagine that. But it's true. And like we've had conversations with with advertisers and sort of like learning this. But it's yeah, you're like in the bubble within the bubble. It's it's a it's a hard thing to realize. I also think like respectfully, it's just probably a lot easier for startups to get on TBPN than it is for them to get on Bloomberg and CNBC. It feels very accessible in the same way that like getting TechCrunch to write about your startup felt pretty accessible in the 2010s. So like that's not necessarily a bad thing, but that's one way that I think that they benefit is they'll kind of talk to anybody.

22:54Casey Newton:Well, and also they have such a positive orientation towards tech, right? And like maybe one of the biggest shifts is like, I don't know, when I was in my first startup job, Casey, maybe when you were at the Chronicle. And not that not the journalist didn't write critical stories, but overall, like startups were underdogs and like taking shots at the big guys. And it was generally like a pretty like friendly relationship with some exceptions between the tech press and startups. And now like as tech has become so much bigger as like tens of billions, hundreds of billions of dollars of capital are like poured in every every year.