Peter Chernin on ‘Backrooms,’ Sequel Fatigue, and Hollywood Mergers

21:12Kara Swisher:So when you think about yourself, like, as you said, you did this in your 40s. How do you then stay connected in some way where you're clocking the stuff? because you could easily make, you know, the basic movie. You could do this in your sleep, right? Presumably a lot of the movies since you've done so many. How do you continue to change, especially when these studios are run by people who are quite, you know, it's the same thing with media. You know I've always sort of been agitating that. I'm like, you're not understanding, especially when I was younger, what was happening here. But how do you stay cognizant of what's happening, especially with this movie?

21:48Kara Swisher:Is there a moment when you would have missed backrooms? There's plenty of moments, yeah. Yeah. Any number of moments where I'll miss any number of things. You know, it's not like I'm so wonderful or I'm somehow better or different than everybody else. I think that, you know, what I used to say when I was running Fox, and I think it's still true, is that ultimately those jobs as an executive and or producer is your job is to have some weird affinity for the zeitgeist of the world's public. two years in advance. That's your job. You're supposed to guess what they're going to be interested in two years in advance from now.

22:26And I say, if you were to design a job to isolate someone from the world's public, you would design the job of a studio head. You work behind gates. You generally live behind gates. You fly privately. The lunch is delicious. You're so isolated from people. And I think you need to do two things, which is you need to just force yourself, both force yourself and I guess instinctively be relentlessly curious. Just, you know, you've got to be looking at TikTok, not as a study project, but just because you're interested. What's going on? What's this about? You've got to be looking at YouTube. You just have to be curious and you've got to be relentlessly curious.

23:09And then you have to surround yourself with as many young people as you can. And let me be really clear, Backrooms was not found by me at the company. It was found by a young executive named Corey Adelson, a gentleman who brought it to me. And I said yes to it, but she deserves the credit for it.

23:26Kara Swisher:What did she say that convinced you? She said, it's really cool to read this. And, you know, she has real credibility with me, and I'm interested in those opinions. And, you know, I think the key is to both have young people trust them and be interested in what they have to say. I think it's the job of young people to force you to pay attention. You know, I used to say, again, I've always said to the people who work for me, if I pass on something that's good, that's your fault, not mine. And it's your fault for not convincing me. And you need to do whatever it takes to force me to pay attention, to convince me.

24:04And I used to say, you know, go burn down my car in the parking lot if that's what it takes. But you have to do whatever it takes to convince me that this is right because I'm by definition obtuse, out of touch, all those things. And, you know, you want to create that environment where you have aggressive, opinionated, passionate young people, and somehow you don't put up enough stupid barriers so that you're not capable of listening to them.

24:29Kara Swisher:We'll be back in a minute.

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25:48Kara Swisher:That's joindeleteme.com slash Kara code Kara. Support for this show comes from Odoo. Running a business is hard enough, so why make it harder with a dozen different apps that don't talk to each other? Introducing Odoo. It's the only business software you'll ever need. It's an all-in-one, fully integrated platform that makes your work easier. CRM, accounting, inventory, e-commerce, and more. And the best part? Odoo replaces multiple expensive platforms for a fraction of the cost. That's why over thousands of businesses have made the switch. So why not you? Try Odoo for free at odoo.com. That's O-D-O-O dot com.

26:35Kara Swisher:Support for this show comes from Teleport. In the AI era, one of the biggest questions is how to contain agent behavior in your production infrastructure. In Teleport's survey of more than 200 infrastructure leaders, the company found that those confident in their AI deployments have more than twice the incident rate of those that aren't, 72 % versus 33%. Let's talk security basics. The most frequent causes of data breaches are human error and compromised credentials. But in the AI era, the challenge is that agents with broad privileges can find these credentials and gain access to sensitive data.

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27:35Kara Swisher:Let's talk about the state of Hollywood broadly then, because as you and I know, since covering this, the slowness of the penny dropping about digital has been glacial, you know, and everything else. So every episode, we get an expert question from an outsider. Here's yours. Hey, Peter Chernin. I'm Ari Shapiro. I'm one of the hosts of the CNN podcast Engagement Party. And here's my question for you. I know Hollywood is going to try to do everything it can to replicate the success of Obsession and Backrooms, these two horror movies that have brought people back into the theaters, blown expectations out of the water, and just dominated the moviegoing experience so far this summer.

28:10My question is, what do you think are the wrong lessons that Hollywood will reach? What do you think are the mistakes that Hollywood will make as it tries to chase the tail of these two movies that have been such runaway hits? Thanks. Thank you, Ari. Look, the lesson is what I just said, which is go find the next YouTuber. Go buy something off of YouTube. It's, you know, it has no relevance. Your job every day is to find something great, exciting, new, innovative, et cetera. You know, look, I would say, and you can understand this, Cara, managing innovation is an extraordinarily complicated thing, equally complicated for people in the tech world.

28:54Yeah. You know, everybody, you know, it's very easy to come up and say, Hollywood is old-fashioned, I don't touch the tech world. I don't know, you know, how many tech companies can you point to that have innovated repeatedly over a 20, 25-year period? They are most of them built off of one extraordinary innovation. And then they go on and, you know, it's no accident that there are very few companies in the world that stay among the top 10 companies in the world for more than 20 years. You know, managing innovation is extraordinarily difficult. And it's difficult in Hollywood. And you lose, you know, you reach the long lessons.

29:30I would also say that, you know, one of the challenges for tech is that, you know, on the one hand, data is an extraordinary gift and an extraordinary tool. It doesn't necessarily lead to innovation. It leads to extraordinary knowledge about how your audience, how your users are currently behaving. But if you just say this is the way they're currently behaving, this is the way they're going to behave forever, you'll fail. Somebody else who does something brand new out of the blue will come up with something new and better. And, you know, innovation is a very, very challenging thing to manage. And, you know, managing content is essentially managing a form of innovation.

30:13They have, you know, very different kinds of elements involved in them, but it is managing innovation. And innovation and creativity are largely the same thing. There are some very different buttons and levers to push on both of them, but ultimately you are trying to get something new and exciting and fresh and original.

30:31Kara Swisher:So one of the things, let me just click on something you said earlier about even though a lot of these original films are doing really well, most of the movies are franchises, right, in which you've been relying on existing IP. I'll say it that way. How do you get studios to be innovative and swing for the fences on a risky pitch when they can at least bank on some success with a safe, known quantity? You have management that thinks long-term. Because by definition, these franchises, certainly over the last 10 or 15 years, have been much safer. However, by definition, you're going to run out of them.

31:07You know, and to the degree you are running one of these places, you should be thinking long term, which is I should be both maximizing my ability to monetize the existing IP that I own, and I ought to be creating new IP that's vital and vibrant, that will have the same kind of economic success over long term. And that, you know, you can't do it to the degree all you're doing is just making sequels. Mm-hmm.

31:33Kara Swisher:And you noted to CNBC that risk is ultimately the lifeblood of success. So how do you get Hollywood to take more risk given, we'll talk a little bit about the sort of economic situation, these mergers, which will, you know, to me, the more mergery they get, the less risk-taking they get given all the huge debt, et cetera, and worries about taking risks. What needs to change? Because Hollywood has gone through periods where they're very safe and then they're very risky, right? I think the 70s was more risky. How do you get them to think if it's the lifeblood of success, as you know? I think it's a couple of things.

32:07First of all, you know, I think the danger thing is to equate risk with recklessness. And there are a lot of people who think risk is reckless. Risk isn't reckless. You know, the wrong risk is certainly reckless, but your job is to figure out, your job is to ultimately make a series of bets all day long. And clearly, you know, you want to revitalize. You know, these things are nothing if not repositories of valuable libraries. There are two things. There are repositories of valuable libraries and lots of IP, and there are manufacturing systems that are allowing you to make creative choices 15, 20 times a year.

32:51you can certainly take risk inside of that portfolio without being reckless. A, the first thing to think about is a portfolio, which is I ought to be doing X number of these things that feel big and safe. I ought to be doing X number of things in the middle that are less risky.

33:06Kara Swisher:Some bonds, some stocks, some cash. Yeah, I ought to be also taking some risk. That's number one. Number two is budgets. By definition, there's an inverse relationship between the size of a budget and risk-taking. and the creative community ought to understand that. To the degree the creative community wants to take risks, make things at lower budgets. And by the way, I think in my opinion, that's the really interesting question around AI. And then I think it's, look, it's also the job of leadership. The job of leadership is to have really talented people that you support taking risks. You know, I believe the best thing you can do is find really talented young people, figure out the good ones, and support them during failure.

33:59Because it's a really weird thing because you are basically trying to run a manufacturing process that is managing creativity. And creativity is very closely associated with failure. Very, very closely. You know, you think about it in lots of ways. One is, it's the scariest thing on earth. Think about what it is to be an actor. You know, to put yourself out there and get judged by people and saying, I don't like her nose or she's, you know, he's getting fat or, you know, those are real. Or look, he looks like an idiot with that choice. That's terrifying. Being a writer, you've been locked in a room for nine months.

34:37You bring your script down and say, well, that sucks. Yeah. And you want to create an environment that makes people feel safe being creative. And you want to do the same thing with the people picking those things. You want to have bold people who both understand enough about the business, who learn the lessons from when they failed, but who also take risks.

35:01Kara Swisher:Safety is also starting to move a little risky. We keep seeing these big movies underperform. The big one now is Star Wars, The Mandalorian, and Grogu, which is interesting. Back to the point you asked earlier. The second thing that will bring back risk is big failures. You know, you mentioned the 70s. The reason the 70s Hollywood innovated so much is all these big bloated spectacles that were playing it safe. Big musicals, probably the biggest of them was Hodel Adali, which virtually bankrupted 20th Century Fox at the time. All those movies started failing. All the things that they were doing, Hollywood spectacle musicals, big westerns, started failing.

35:35And they were forced to take risk.

35:37Kara Swisher:Right. That's a really good point. Although now Hodel Adali's seen all the time. Like later, they have different lives, which is interesting. One of the things, of course, is the center of Los Angeles being that there's been a big decline, as you know, in the number of projects being shot there. A lot of productions have moved out of state and overseas. As content becomes more global, is Los Angeles still the capital of the entertainment industry? Yeah, I would say two things. So jobs in Hollywood have declined by about 35%, 40%. Some of that is tax credit related. Some of that is global production related.

36:13Some of that, in my opinion, is about vertical integration. And by the way, I'm far more concerned with vertical integration than I am with mergers. And that's, let's think, you know, in essence, Hollywood has always been the center of global production. It has always been the center of looking for filmmakers in France and Italy and Korea and bringing them here. And it's just been a nexus for ultimately the financial underpinnings of that. You know, movies have always been made all over the world, in Canada and England, you know, and other places. And so probably, I don't think Hollywood has become less central.

36:55I do think that the world has become more global. And, you know, one of the things, you know, I mentioned earlier that I had sold my production company, which I have sold to a French company called MediaWand. And one of the reasons I did that was that I believe that if you look at the platforms, Netflix, Amazon, Disney, Apple, have all become global. They are a global platform serving a global community. The production companies have not. The production companies have never been global. You know, the big European companies were never successful in the U.S. The U.S. companies never cared about the rest of the world.

37:28They were just like, we'll sell our stuff there. We won't make it. And I think there's a big opportunity for a global production company that is beginning to unite the highest quality talent all over the world.

37:40Kara Swisher:We'll be back in a minute.

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39:23Kara Swisher:Support for this show comes from Odoo. Running a business is hard enough, so why make it harder with a dozen different apps that don't talk to each other? Introducing Odoo. It's the only business software you'll ever need. It's an all-in-one, fully integrated platform that makes your work easier. CRM, accounting, inventory, e-commerce, and more. And the best part? Odoo replaces multiple expensive platforms for a fraction of the cost. that's why over thousands of businesses have made the switch so why not you try odoo for free at odoo.com that's o-d-o-o dot com when you finally find your thing you want the whole world to know about that thing so you use a thing called canva to make it an even bigger and better thing whether you want to create flyers for that thing make presentations for that thing or design merch for that thing You can do anything.

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40:34Kara Swisher:So one of the obvious biggest trends, and it's impossible not to talk about, is AI in Hollywood. You've also said you have an obligation to be relentlessly interested in new technology. And it's something I've liked about you because there were like three executives who weren't terrified of tech. You, Barry Diller, and Bob Iger, I would say, not terrified of tech, essentially, or dismissive, one or the other. Obviously, AI is the latest, and there's been many over the many years. And your production company was one of the lead investors in an AI studio, Promise. Their goal was to actually make shows and movies using AI.

41:06Kara Swisher:Of course, it scares a lot of people in the industry. You know, is there a real loss of jobs? I think there is in certain areas and certain areas not. but talk about the worries that go on, given you've got to be thinking of costs, too. Yeah. Let me be clear. I said two minutes ago that jobs in Hollywood are down 35%, 40%. Right. I don't think there's a single job in Hollywood that's lost to AI yet. Not one. So, what's going on in Hollywood right now, which is devastating, and I'm deeply, deeply concerned about, I'd be happy to talk more about, has nothing to do with AI. So, this, and by the way, it's typical, which is people are afraid of the wrong thing, right?

41:43Which is, they're already in big trouble and has nothing to do with AI. Can I guarantee, by the way, you know, there's widespread terror about job loss everywhere because of AI. And certainly if you look at the economy today, inflation's a problem, jobs aren't. So we've yet to see that. It's good, it's always good to be paranoid. It's always good to be worried, but we haven't seen that. Look, what I would say, my instinct is the following, which is nobody knows. We should all be super interested in what it is. You know, there's certainly an easy analog in the transition from hand-drawn cell animation to computer animation.

42:25That's an absolutely analog, which is it replaced humans with machines. Artistically, it was fantastic. And by the way, it was fantastic for jobs. There There are more jobs in computer animation than there ever were in cell animation. So, and that's a pretty close analogy is that it was, if the guilds and people like that said, you got to protect human beings at all costs, we never would have had Toy Story and, you know, all of those wonderful CG animated movies. And so, by the way, the same thing is true with special effects. Special effects all used to be analog. Every single one of them is digital right now.

43:02And there are more jobs in special effects than there have ever been. And there are higher quality special effects than there have ever been. So this sort of knee-jerk paranoia about technology is bad, it's going to kill humans, it's going to kill jobs, etc., I think is not smart.

43:19Kara Swisher:Right. Well, I think people are worried about the valuations these companies are getting, you know, that these all, like, for instance, you know, Anthropoc, OpenAI. But that's not a question about Hollywood. That's a completely different question about AI. Right, right. Right. But you think that they're worried about, I want to ask what you're most worried about in a second, but you are seeing some jobs from real actors, for example. Business Insider wrote, for example, about so-called micro dramas and verticals that are using them, short form series designed to be watched on the phone. Viewers are mixed on the results.

43:52Kara Swisher:Is it a sign to come or not? I've always found them to be not good yet. But whenever I see something in the internet that's not good, I just recall seeing early Yahoo. It wasn't very good. And I kept thinking it's going to get better, right? And the New York Times just did an interview with AI actor Tilly Norwood, which was strange, I thought. It was very strange. At one point, the importer asked Tilly what's to stop her from taking other people's jobs or alienating humanity. One of the responses she gave was, quote, whether the people building me are willing to say no to profitable but corrosive uses.

44:23Kara Swisher:So you think it's just overhyped, this idea of that this will be what kills these companies or hurts them? I think it's completely overhyped. By the way, you know, if you look at what most technology has done is extended the power of storytelling. And so to the degree of microdramas, and I tend to agree with you that most of them aren't very good now. We'll see if they become good. but they're not killing Netflix or YouTube or anything else or movies. They are a new form. And to the degree they are a valuable new form, you'll start seeing more actors in them. The reason they have AI actors in them is they are done incredibly cheaply and it doesn't matter that they're not high quality.

45:11To the degree that they become all of a sudden super valuable, people start casting actors in them. Yeah. You know, my simplistic view of AI is use it as a tool. Now, that tool, it may be just a tool. It may be a way to streamline the cost of pre-production. It may be a way to... Costuming, you could see. Yeah, it may be a way to... Obviously, it has huge implications for special effects.

45:34Kara Swisher:I think it was Scorsese with the storyboarding, right? Yeah. Correct. He was in that Ovitz company. By the way, it may also give you tools to actually create new art forms with. We'll see. And it's interesting to embrace all those things. So the degree you're interested in telling stories to human beings, you should be interested in. The other side of it is rather than trying to restrict Hollywood from using it, because to the degree it's meaningful, you know, all you're going to do is make Hollywood smaller and smaller and smaller as these other things coming. Hollywood has generally been a place that is really good at, as I said earlier, the manufacturing process of storytelling.

46:13It should be extended to new art forms. Absolutely be really stupid not to do that. So it should be. The same time, I think it's important to say you should be relentlessly focused on copyright. You should be focused on you can't steal. You can't steal from these works to train large language models. You can't steal actors' likenesses. You can't do those things. Those are very valid, in my point, in my view. Copyright is copyright, and it should be sacrosanct. And I do believe that, by the way, I think Hollywood should be more aggressive about copyright. I agree. Right? Much more aggressive about copyright.

46:45Right? And I think it's going to be real. The copyright questions around AI are going to be fascinating over the next five to ten years. Yeah. But restricting AI, I don't get it. I don't think it makes any sense. And I think that to the degree, look, it may not be meaningful. It may be partially meaningful or it may be meaningful. But in any of those answers, Hollywood should be playing a part in it.

47:06Kara Swisher:What's the most interesting thing you've seen and something you've seen? Oh, come on. No. With AI? Yeah, with AI. The most interesting thing is, and I won't name them because it hasn't come out yet, there is a cable network that has started experimenting with some large-scale documentaries, 100 % AI. Pulling from archives? Archival? Just making stuff. Just saying, you know, do a caveman drama or do The Fall of Rome, right? Using AI. And I've seen 10 or 15 minute segments that they've done 100 % AI that are fascinating and really impressive. There's little experiments like that online in little short form.

47:58Kara Swisher:Like, you know, it's usually around hardware or making something, but go ahead. But that's, to me, the most impressive stuff. You know, look, we are the company that we invested in, Promise Studios, which is doing a wide range of stuff, all of it interesting to me. And we invested mostly because we believed in the leadership and because we were really interested in learning. I would say, if you asked me to judge today, television animation, good enough to make television animation today. Good enough to make commercials today. Good enough to make some reality show level quality stuff today. Good enough to make special effects.

48:38Getting closer on feature film quality animation. And still pretty far away of making true narrative storytelling with actors, right?

48:47Kara Swisher:Yeah, documentary is actually a great way to do that. because there's so much stuff. Like, why do you need someone, person, to do the fall of Rome when there's just history? Nobody can say that's not what it looks like because we weren't there. But I want to go back to what I said earlier, which is what I think Hollywood, and particularly young people, should be excited about is to the degree that it's a valid tool to make things. It should play a meaningful role in driving down costs. And if you can drive down costs, you can innovate more. And I think in some ways, the thing I would be most excited about is the match of 22-year-old genuine storytellers and AI.

49:29Because there are going to be some young people with great imaginations who are going to get better at the technology than anybody else who are going to make$500 ,000 movies that are great. And there should be 100 of them being able to be made. That's great for the art form. That's not a bad thing. That's a great thing for the art form. And anybody who's interested in the art form should be interested in any innovation that has the opportunity to drive down costs. Because the single most challenging thing to the art form right now is how expensive it is to make things. You know, when the average studio movie is, whatever it is today,$80 million, plus has another$50 million of marketing behind it, it's a challenge to innovate at$130 million hour bet.

50:12Kara Swisher:It is. And that's how the internet got started. Those are all small companies riding off of everyone else's free stuff. Take some chances. You did say one thing that worries more than mergers. I did want to end talking about mergers in Hollywood. And as you noted earlier, you sold your content studio in North Road to the French entertainment giant, MediaOne. As you said earlier, you felt like it was time for content companies to get bigger and become global as entertainment and tech platforms consolidate. When you think about, you said mergers aren't the problem, It's something else. Vertical integration.

50:43Vertical integration.

50:44Kara Swisher:Explain that for people, what that means. Vertical integration just means that one company is controlling the entire process. They are making things, owning things, and distributing things. So if you look at the big platforms, they produce, own the production, own all rights in perpetuity, and distribute it only on their platforms. Netflix. Right. Netflix, by the way, Netflix is no worse than Apple, Amazon, right? Disney. All of these people want to control everything. There are a couple of big negatives to that. If you go back to the 70s, which you refer to as the 70s and 80s were really when Hollywood exploded, and you had two things that separated that.

51:32You had a consent decree, which said the studios weren't allowed to own movie theaters. And so it separated movie production from movie distribution. And you had the financial interest syndication rule in the television business, which said the networks could not own the shows they made. They could only license them, right? It led to the explosion of the movie business.

51:53Kara Swisher:Production companies created. It led to every single one of those studios, which were dying in 1970, became the dominant television producers. Disney, Fox, Universal, Paramount, Warners, all became the biggest television producers. And it's really what led to their growth in that 25-year period. What you have right now, so I believe it would make the ecosystem far more vibrant. That's number one. Secondly is this idea that things don't go from one platform to another because all rights are held in perpetuity. It's just bad for things circulating. Right. So it stays in Netflix, stays in Apple. Yeah, and by the way, it becomes just an old piece of content on Netflix versus you look at the number of things that became hits on the second platform they were on when they got marketed again.

52:44You know, look at Seinfeld, which was, by the way, a big success on NBC, not in the first year, but was a big success later, has become ubiquitous in syndication. The Simpsons, ubiquitous in syndication, et cetera, et cetera. So that's a bad thing. The third thing is I believe it's bad for creativity because you have every single creative decision funneling through one hierarchy. And creativity thrives where it's messy, where there are people arguing about things, where, you know, if one person doesn't get it, somebody else is going to get it somewhere else and will innovate somewhere else. And so I believe it's very valuable to have creativity thriving.

53:24And then the fourth thing I would say is that what's happened in this process is there's no economic hits for talent. There's also much less economic failure for talent. There's unemployment for talent, and unemployment is meaningful. But once you make something, there's no failure. You're getting paid the same whether something succeeds or it fails. That's a terrible thing.

53:48Kara Swisher:So there's no incentive. There's both no incentive and there's no terror. and being terrified as a creative is a great thing. That's a really good point. Right? Yeah, you get paid. You get paid less, but you get paid, so it's safer. You get paid. And you're also not incentivized to kill yourself to make it great. They're not incentivized to promote things as they used to be, etc. And so I think vertical integration is really bad for the system. I think to the degree I'm scared, you mentioned what else I'm, what I'm terrified of is the impact of vertical integration on the Hollywood storytelling community.

54:22because the stronger those vertically integrated companies get, they will look to squeeze talent because it's just a cost. It's a widget. It's the cost of a widget. If you're in the widget business, drive down the cost of widgets.

54:35Kara Swisher:So should there be regulation or maybe antitrust enforcement to force them to move away? I believe that that would be more valuable from a regulatory point of view than regulating consolidation. I don't think consolidation is wonderful, But I think that if you were to be able to regulate one thing, I think regulating vertical integration would be far more valuable. I hadn't thought about this. Yeah. Now, you said you're supporting the pending merger of Paramount and Warner Brothers because you want to see another strong competitor. Yeah. Right now, the antitrust grounds are pretty weak. They're still 20 % of the market in certain areas.

55:10And I think that, you know, I worry about, look, I think in the current situation, what would be the single best thing to happen is another strong competitor. And whether or not it becomes that, I can't tell you. It'll be a function of how smart and talented and strategic they are. But if they became another strong competitor, it would be good for the industry.

55:33Kara Swisher:It doesn't just make them a taller like Oompa Loompa. Like, you know, they're not big enough for these because a lot of these are tech fueled, right? And I would not call, Paramount is tech-fueled now, but not exactly the same way. It's not tech-fueled. It's not. It's not. Trust me, I know. I get that. It may be down the road, and that's what they're doing, but it's not yet. No. No, look, I think that it is certainly a big, big challenge for Hollywood, and someone who understands something about both worlds like you should be thinking about this more, is that these are small companies. They are.

56:09You know, Larry Ellison personally is bigger than Disney, is bigger than Comcast, is bigger than, you know, is bigger than, and so particularly when you look at YouTube, YouTube's part of a, what,$3 trillion company? You know, the biggest media company right now, I would call Netflix a tech company. In that case, the biggest media company is Disney, which is a$200 billion company, you know.

56:29Kara Swisher:Yeah, I was arguing at one point a couple of years ago that when they were challenging the AT &T-Warner mother, which didn't turn out to be a good merger, but that had to do with dumbasses running it. But I was more like, I was arguing with one of the antitrust people. I go, they're too small compared to the tech people. You don't understand. I hate to say it, but consolidation is the only way they're going to survive. That is the only way they're going to survive right now. But I was like, I don't like it, but you've now got these tech companies in these pole positions where they control every bit of distribution.

57:01I think one of the giant questions, to the degree they end up controlling these things outright, is can they get good at managing creativity? And there are huge differences, which I'm not sure they've thought about, between managing technological innovation and managing creative innovation.

57:20Kara Swisher:So when you have something like a Paramount one, Paramount, Warner one, David Ellison has promised to make 30 theatrical films a year if the deal goes through. Others, we'll see it is all likelihood going through. But I'm looking at the math of$80 billion in debt and everything else, and I watched, you know, what happened to Warner before that. And it seems to me they're still small, even if they seem irritating in the news area, which they are. And they're somewhat boneheaded in the news area, more than boneheaded. You can comment if you want. But I don't see that they're big enough. And I see the number, no matter how rich Larry Ellison is,$80 billion in debt is kind of a big thing to drag behind you.

58:04Look, I think I said this before. I'm not inside their books. It's very challenging. You know, it's challenging to make 30 movies. It's challenging to continue to build the streaming service. And it's doubly challenging while your core business, which is linear channels, is in decline. So they've got a – they're the ones making the bet, not me. They've got a really hard task ahead of them. And God bless them. I hope they succeed because it would be good for the business.

58:33Kara Swisher:Would Netflix have been a bigger owner or would that have been more disastrous? Because I think Netflix is going to come in and buy it all up at the end when they fail. That's my feeling. I think that, well, it depends on success. If Paramount could succeed, that's better because what the world badly needs is a competitor to Netflix primarily right now. So in that sense, Netflix certainly wouldn't have been a better owner in the short term. But if it goes out of business, I guess it would be a better owner. Yeah. That's the sense in which I said I was rooting for it to be successful. Which gets us back.

59:10Kara Swisher:You said Netflix is the one to meet, but YouTube is the one. YouTube is absolutely the one to meet. But to say, you know, I don't buy, you know, which is the Netflix argument or was the Netflix argument when they're in. I don't believe that YouTube and Netflix are direct competitors right now. Right? I think everything is competitive for people's times. Everything. But that's like saying, you know, Netflix is competing with video games or Netflix is competing with sports. You know, there's enormous competition for people's times. Netflix is a streaming, long-form video service. YouTube right now is, I guess, largely a short-form video service with a little bit of a essentially virtual cable channel.

59:54You know, virtual MSO thrown in there. though that's a small part of their business on a relative basis. So, you know, individual people who work in the business are not waking up saying, should I go with YouTube or should I go with Netflix? There's zero competition. So this idea that they're competing with each other, they're competing with each other the same way that you're competing with Netflix or that you're competing with the New York Times or you're competing with, you know, video games. You're competing for people's times.

1:00:21Kara Swisher:Yeah, yeah, that's true. That is absolutely true. So do you think this Warner thing has a change? I mean, you don't know yet, but I think it's not going to work out well. I just have watched so far. I think it's challenging. Yeah. You're nice. You're nice. They can't do it. I just don't think. I don't know. I'm not a fan of inherited wealth, so that's fine. But great movie. Top Gun, Maverick, I love it. So you've just turned 75 years old. You've been in the business a long time. Have you thought about retiring? How do you look at what you want to do next and your legacy amid these monumental changes?

1:00:58Kara Swisher:You've worked through every aspect of this, including working for Murdoch and everything else. The idea that business people have a legacy seems beyond silliness. Stop not being narcissistic, Peter. And it's the ultimate hubris. There are four or five business people a century who have a legacy. So that's a ridiculous thing to think about. All right. So I have no legacy. I'll be dead. That'll be that. You greenlit, sir. You greenlit Titanic and Avatar. Then I can remember that. Look, I am interested in being interested in stimulating. I'm interested in spending more time with my family. You know, I have a charity that I've been involved with for a very long time, Malaria No More, that I'm deeply interested.

1:01:43I have a new charity that I just started called Billion Scale Health, where we're doing extraordinary things, trying to use technology to build health scale solutions for a billion, for potentially a billion people. So I'm engaged in that. I still want to do creative things. I have projects that I'm producing and that I'm interested in. I will help this French company, of which I think I'm the largest shareholder. So I'm interested in being stimulated and fulfilled, and I'm interested in helping, you know, the greatest satisfaction from a business perspective for me right now is helping talented young people.

1:02:17Absolutely. But I have no legacy.

1:02:19Kara Swisher:Yeah. All right. All right. Fine. Unfortunately, Cara, you may not either. I do. That's not true. I'm a media entrepreneur. No. All these people are chasing the stuff I invented. I am. I shall be remembered by my children, at least. Yeah. It's interesting. I haven't seen you at the White House groveling to Trump at all at once. I guess I haven't been there, no. Are you not going to the UFC fight? What? I'm not going to the UFC fight. By the way, I never really liked UFC, so. No, I will not be at the UFC fight. Oh, damn. Anyway. Right. Anyway, Peter, as usual, you're really smart. You do have a legacy.

1:02:54Kara Swisher:I don't care. I'm going to just say that. Yeah, we'll see. Yeah, yeah. We can ask each other that question in 20 years. You have enormous patience given some of the jackasses you've worked for over many years. I'll tell you that. Me too. Anyway, save that for you. Are you writing a memoir? Are you writing a memoir? I would never write a memoir. It's the least interesting thing on earth. It's so good. It's so uninteresting. I'll just continue to go out to lunch with you and hear the stories. That's how I'm going to go with it. That'll be my memoir. Anyway, Peter, thank you. And it really is, Backrooms is really interesting.

1:03:23Kara Swisher:And when I saw, I've always thought you made a lot of interesting choices and surprising choices. And I was very happy to see this work out for your company. Well, thank you. I enjoyed it. and congratulations on your new home. Oh, thank you so much. Yeah, right. Oh, I have another Murdoch. Yeah. What should I do? You're back. No, I own my own IP, Peter. I mean, come on. It's just, and it's also the best Murdoch. I have the best Murdoch now. It is a low bar, but he is the finest Murdoch of the Murdochs. No comment. No comment from Peter. No, to be fair, I had a very good run with Rupert. You did.

1:04:00Rupert treated me extraordinarily well. He is a legend. We had a huge amount of fun and we did great things together. Yeah, he did a lot of great things.

1:04:09Kara Swisher:He also did a lot of deleterious things. But nonetheless, it's a mixed bag. Anyway, thank you so much. I really appreciate it. My pleasure. I enjoyed it.

1:04:20Kara Swisher:Today's show was produced by Christian Castor-Russell, Michelle Eloy, Catherine Millsop, Madeline LaPlante-Duby, and Kaylin Lynch. Nishat Kerwa is Vox Media's executive producer of podcasts. Special thanks to Annika Robbins, Corinne Ruff, and Julia Sharpe-Levine. Our engineers are Fernando Arruda and Rick Kwan, and our theme music is by Trackademics. If you're already following the show, you help make a YouTube series a box office smash. If not, you're watching an endless loop of bad sequels. Go wherever you listen to podcasts, search for On with Kara Swisher, and hit follow. Thanks for listening to On with Kara Swisher from Podium Media, New York Magazine, the Vox Media Podcast Network, and us.

1:04:58Kara Swisher:We'll be back on Thursday with more.

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