Synergy’s Must-Watch Final Episode

0:08Hello and welcome to Slate Money, your guide to the business and finance news of the week. I'm Felix Salmon of Bloomberg. I'm here with Elizabeth Spiers of New York Times. Hello. With Emily Peck of Axios. Hello, hello. And oh my God, people, guess who's back, guess who's back, guess who's back. It's Edmund Lee of Reuters. How you doing? Ed, we haven't actually had you on this show since you've been back at Reuters. That is true. Well, I only just started some weeks ago, so you caught me early. You need no introduction because you are the best guest on this here podcast. But for those of us who may be tuning in for the first time, who are you?

0:51I am the newly appointed media editor here at Reuters. But I have been covering this beat for a long time, longer than I care to admit. I'm also, in addition to that, a very regular Felix Salmon debater and caller-outer of incorrect assumptions. We'll thumb wrestle after this. The reason we have asked you on this show this week in particular is because there is a big piece of M &A news in the media industry, which only Ed Lee has the nous and the insight to be able to unpack. so we're going to have you do that. We are going to talk about the World Cup and the ratings thereof. We are going to talk about the billions, that is not an exaggeration, literally billions of dollars that Donald Trump seems to have made in a single year.

1:39We have a must-listen Slate Plus episode, if I do say so myself, on anchovies and croissants. Great pairing. A great pairing. lots of juicy, delicious, tasty stuff coming right up on Slate Money.

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4:10So Ed, welcome back to the show. I have to start off by saying that back in 2016, you came on this show with me and Kathy O 'Neill, and we were talking about AT &T buying Time Warner. And I went back and listened to it, and I was so wrong. You more or got everything right. You didn't get everything right, but I got literally everything wrong. Felix never says this either, Ed, so this is a big deal. Can we just sort of forever? This is the intro for every slate money. The intro for everything. I thought, in the dim distant mists of my memory, I thought I was a little bit skeptical about I don't entirely understand why these cable companies were buying these content producers.

5:01Turns out that you were the one making that very sensible point. And I was the one saying, well, maybe there is some kind of global distribution and you get money from other cable companies and it could make some kind of strategic sense. Money would just magically sort of appear in this combination. Synergies. Synergies. So would it be fair to say that at this point we have reached the end of the synergy line? The era of cable companies and telephone companies deciding what they really need to do is own content is more or less over. Yes, absolutely over, but I thought it was over a long time ago.

5:43It's just that AT &T never got that memo, right? You know, Time Warner eventually got that memo when it divested Time Warner Cable, which was an early iteration of all that. And, you know, it's finally Comcast is getting that memo, though I think they got the memo. They read it and just ignored it for 15 years. You were writing that memo like Rico.com for many years and they were just sticking their fingers in their ears and saying that we can't hear you. Right. And everyone just sort of ran the party line for a while. And I'm not saying that's what you were doing, Felix. I think you were actually looking for actual magic in this combination.

6:23What I was doing is being a good sort of mildly contrarian, efficient markets guy. I was like, if the market says that this should be a thing, then there should be some reason for it. But now that we're all safely in the rearview mirror, and we can talk a little bit about the news in a minute, but I think in order to understand what's happening now, we need to go back to that period of 15 years ago. So why was it that Comcast, to take the company of the moment, why was it that Comcast woke up one morning and thought to themselves, what we really need is NBC? You know what? It's actually a really good question.

7:07And it's worth tackling, right? Because a few things. Just really basic, Comcast, a cable operator. The way the cable industry works is you have what is effectively a regional monopoly. In other words, there is a certain physical footprint of the United States where you are allowed to operate. You have essentially a monopoly for that region. And yes, you could conceivably buy other cable operators in other regions, and they have all started to do that. But Comcast was getting limited. They're like, OK, there's only so much we can do here. And so, you know, they added more services and cable costs keep increasing and everyone's complained about that.

7:44And so there was a legitimate concern. It's like, how do we continue to grow? And so they're like, well, hell, we are basically selling content, licensed content to our customers. Why don't we just own the content as well? Right. So it's part of our ecosystem. And so this has come back to the classic debate that, you know, I used to have more or less every week with Anna Shemansky back in the day, which was like, why do public companies need to grow? And what, you know, why do CEOs constantly look for growth? Yeah. I mean, now we're just getting something really much more fundamental. Right. which is just the nature of American capitalism.

8:19Yes, there is a scenario, there is a monetary theory in which growth is not the goal, especially if you think about the way inflation works. So like, yeah, but we just don't live in that universe. That is an alternate timeline. No, but like, we do because this is exactly what NBC is, what like Comcast is now doing. First of all, they spun off Versant and we can talk about what the hell Versant is. and then they decided they were going to spin off NBCUniversal. And so what's left is going to be back to the old days of just having a regional cable monopoly and they are shrinking back down to their core value proposition.

9:00Well, because just really simply, I mean, if you just look at stock valuation, Comcast versus, say, the S &P 500, over that period of time, Comcast has slowly gone down. S &P 500 has slowly gone up. But that's just because NVIDIA has done crazy. Like, you know, NVIDIA's XMAG7, I think Comcast has done slightly. So you can XMAG7 S &P 500 and like, yeah, it's going to be a more steady curve. But like as a Comcast investor, you're not necessarily realizing the full investment. That said, I will give Comcast credit for having managed NBCUniversal, I think, in a really professional and maximalist way.

9:40They did absolutely everything they could to make NBCUniversal a valuable portion of the Comcast empire. But that doesn't necessarily mean that by Comcast owning NBCUniversal, you unlocked higher value for either side of the entity. There were no synergies. No synergies. They're better off separate than together.

10:00Felix Salmon: It's like a conscious uncoupling. Sometimes it's just better. Conscious uncoupling. You just plant the seeds in different pots and watch them grow. Emily, as someone who used to be owned by Verizon. I used to be owned by Verizon, personally. Weren't we all at one point owned by Verizon? No, Emily was at HuffPo when HuffPo was owned by Verizon. HuffPost. Sorry, HuffPost, when HuffPost was owned by Verizon. And did that make any sense to you at the time? It never made any sense to me at all at the time. And now I'm just grateful that it happened because it was wonderful to have a big cash rich corporate parent, as I'm sure that I remember talking to people at NBC who are like that cable money.

10:43Felix Salmon: It's right there for you. It's so great. And, you know, it was good while it lasted, but it never really did make very much sense. Like when I think about companies making money from content, I understand that. I understand Netflix makes money from content. I understand the idea that Ed was laying out that TNT was like, we pipe the content. Maybe we should own it and make more money. Like that kind of does make sense. But like internet content, I think as we've all learned and we knew, we knew when the Verizon deal happened. We knew it just wasn't, it wasn't where the money was. Elizabeth, as a media person, do you see the difference between now and 15 years ago?

11:22What is your theory for what changed? Why did the Masters of the Corporate Universe, after being super acquisitive 15 years ago, why are they all breaking things up today? Well, I think two things. One is that they sort of assumed that there would be some added value if we just smashed all these things together and that it would happen largely organically. And then it just didn't happen for a variety of reasons, including the economics of media changing. And then the second thing, and I think this is the case with Comcast and NBCU, they sort of realized that in certain ways, having the companies kind of smashed together actually prohibits them from certain things that they might do to acquire growth, particularly M &A activity, because parts of the business are subject to different regulatory concerns.

12:10And I think that is part of the logic here in separating the two. So I wouldn't rule out that this is necessarily indicative of the company not chasing growth anymore. I think it's just a different way of going about it. I think it's definitely indicative of the company not chasing growth anymore. And, Ed, you can tell me that I'm completely wrong about this. And I will be wrong if you do.

12:32Felix Salmon: Come on, Ed. You've learned anything over the decade. If you look at the stock market reaction, like when this announcement was made that Comcast was breaking up, the stock of charter communications goes up 20 % within like four minutes. And that's obviously nothing about this breakup is affecting charter communications. But it seems to me and it seems to the market pretty obvious that what is happening here is it's creating two different companies, both of which are small enough to get eaten at a premium and create lots of mergers with someone else. And literally zero people would be surprised where Charter and Comcast to merge at this point.

13:14Yeah, I'd say that. The one thing I really want to emphasize here, because there's a lot of reporting around this announcement that is not quite correct or misreads something. And that's this. And everyone's sort of jumping on the fact that like, hey, you know, when it was announced, investors asked Brian Roberts, CEO of Comcast, hey, is this a prelude to more M &A? Is that the whole point of this? Right. And his response is, quote, absolutely not. Right. And did anyone believe him? Well, so there you go. That was the response. That was the media columnist's response to that exchange. Here's the thing, though.

13:51There is a really specific reason why he said that, and it's very tactical and specific and purposeful. And that's this. The transaction is announced is a tax-free spinoff, right? So there's no tax incurred on the part of Comcast or NBC once this is spun off. It's also important for him to publicly make clear this is not in any way prelude to M &A because to stay tax efficient, which means to avoid taxes, if an M &A deal were to happen with either party after the spinoff, it can only happen and preserve the tax efficiency if and only if the parties involved had never discussed any kind of merger prior to the spin.

14:34And then they have to wait two years, right? You don't have to wait two years, in other words, right? In other words, him being really vocal and specific and succinct about that is a way to, in a sense, accelerate the clock on any potential M &A once the spin out is done so that they can still preserve tax efficiency. So there is a really specific reason for it. And it is a specific reason why we should not take what he's saying at face value at all. That as well. But again, it's like taking it at face value is what allows potential parties involved to engage in M &A. In this current period, however, before the spin.

15:11If I'm Netflix or Charter or any of the other companies that people are talking about being acquisitive right now, Amazon, I have to just hold my horses for the time being. I wait for this spinoff to get done and then I start calling my bankers. And or if you're Jeff Bezos or you're Ted Sarandos, you can call up Edmund Lee at Reuters and say, hey, that's really interesting what happened over there, Comcast, NBCUniversal. I didn't know that was going to happen, but that's super interesting. You know what? I think NBCUniversal could be worth as much as$39 billion. What do you think, Ed, on background?

15:52And I'd sort of say, yeah, that sounds really interesting. And then I could type it away, print it out. And then Comcast, Brian Roberts would understand, oh, I'm only being valued at $39 billion for my NBC Universal asset. I think I could do better. And then Jeff Bezos could call me separately and say, hey, I saw that$39 billion. I actually think it's worth$45 billion. And we type that up. And then Brian Roberts would read that in Reuters.com and be like, oh, that's a better price. I like this Ed Lee valuation strategy. That's, you know. This is definitely, you know, not dissimilar to the way that, you know, Fed chairs, you know, use the press to communicate to people that they can't communicate directly to.

16:35It is a legitimate kind of journalism that serves a very useful function. And if you are the kind of journalist who gets calls from Ted Sarandos and Jeff Bezos, then you should 100 % do that kind of journalism. And I am going to go off on a little bit of a tangent before we come back to what the fuck is a person. But when you find yourself in that position and you know exactly why they're calling you and what they're doing and what your job is and all of the rest of it, do you ever think to yourself, I should probably signal this somehow to my readers so they understand what the hell they're reading?

17:15So M &A reporting is not for the faint of heart. It's not for amateurs. Absolutely not for amateurs for this very reason, which is I just identified two potential parties as sources, which would be great. Those are absolutely great sources. It almost never happens that way. The way it happens is that Ted Sarandas will tell one of his deputies who will tell his general counsel who will tell the banker at or J.P. Morgan or wherever say, hey, we would like to price. We want to get a price understanding of this asset. Right. That banker will then get one of his lieutenants to then like call a reporter or an editor and say, hey, what do you think about understanding that a weaker reporter will just sort of spit it out there just to see what the reaction would be.

18:01Now, that's not to say that's not legitimate in some form, but a good 60 % of that's bullshit anyway, right? So you as the reporter, the onus is on you to say, that's not enough, right? I need more before I put that out into the public. And a lot of reporters don't understand that. As a reader, we need some kind of meta understanding of where am I reading this? Who is writing it? How professional are they? Why did this particular leak wind up with this particular reporter? and that kind of high-level sophisticated ability to read the press is not particularly common. It's lacking. There's low literacy.

18:37But what should there be? Because no one's explained it to the reader, even the sophisticated reader. And even for the sophisticated reader, they have to evaluate, is this outlet, is this reporter worth it, right? Are they a good reporter? Do they know what they're doing? And a lot of new names on the field and not always clear. If it's Charlie Gasparino, then you can ignore it. I'm not going to comment on that.

18:58Felix Salmon: The markets understand this, right? Like they find the information, like they understand it. I'm going to get even more meta. The markets will trade on the markets understanding the value of that information. They don't trade on the intrinsic value of that information, meaning it's not about this transaction potentially happening. It's about other people in the marketplace recognizing that other market makers will trade on this phantom possibility. And so, therefore, they will trade on it as well. It's the Keynesian beauty contest. Yes, exactly. And so when you see the market jump, people, media reporters, be like, oh, look, the market likes it.

19:38No, they like that people think that they will like it.

19:42Felix Salmon: But someone likes it. Maybe. If they're thinking that someone likes it, someone might like it. Maybe everyone just thinks that everyone else likes it and no one actually likes it. Yeah, yeah. That's like why people, yeah. Well, I think you're right, Emily. But the way to understand that is you won't know that till the 13F filing later when the institutional investor buys into it. because they need to hold things longer. And so they're evaluating the more likelihood. And they probably will buy into it, but maybe not as much as you think. Not as much as the market spiked on the day. Okay. I have to just mention one other thing.

20:13Since you mentioned Brian Roberts, we might not come back to him for a minute. Brian Roberts now has the best job in the world. He is splitting his company into company A has a CEO. Company B has a CEO. The man in charge is still Brian Roberts, but he has no CEO title at all. He just gets to sit around in his kimono and smoke a cigar and be like, I am bringing the ear of both CEOs. And they kind of understand that they should listen to me. And that is my job. And I'm going to be paid astonishingly well for having no actual executive responsibility at all, if that can work out. I think you've nailed it.

20:50You're right. See, you got it right there, Felix. That is absolutely correct. You'll forever be correct on that part. Hashtag squad goals.

20:59Felix Salmon: Can we also tell the listeners what you told us in the planning call, which is that you scoffed at the idea of Netflix being worth, what did he say? $55 billion. $55 billion. You're like, that's ridiculous. It's a relative value trade. I was saying that the market was saying that HBO was worth less than Netflix. And I'm like, that's ridiculous. Obviously, HBO is worth more than Netflix. Ed, how much is Netflix worth now? I think it's like$330 something billion. And that's a fall from like what it was a year ago, right? Where it's like, you know, Comcast is treading at 80-something billion, Disney something, you know, like whatever it is.

21:39I was trying to make the case that it made sense for AT &T to buy Time Warner rather than Netflix because it could have bought Netflix instead. And I was like, oh, no, that wouldn't.

21:49Felix Salmon: That would have been smart. They couldn't pay their dividend. They needed to pay their dividend. And they couldn't afford to pay their dividend if they bought Netflix because Netflix wasn't making money at the time. There's one more thing I wanted to say that's sort of like, for me, a lesson that I've sort of thought in my head to take away from what we're talking about here with these like old line cable companies trying to get hip and buy these internet companies. Well, not really. Comcast wasn't trying to be hip by buying NBC. Two very boring companies merging with each other. But the idea that like an old line technology, like a cable company can transform itself into a new era, like the internet era, and can't do it, like doesn't actually make sense.

22:31Felix Salmon: I feel like it's something to think about right now because we have Mag7, not all of them. We have our Meta. We have our Google. We have our Amazon thriving big tech companies that have owned this era that are worth so much more than these other companies that mattered long ago. And they're trying to now transition to the AI era. And we're all calling them hyperscalers. And like, we're all excited about their growth and their potential to be the biggest players in the next iteration of tech. And I'm thinking like, yeah, maybe, but maybe not. So I think you bring up something really astute there.

23:07I do think, so when AT &T bought Time Warner, there was that sense of that. There is, however, I think right now for Comcast in particular, the opportunity to really capitalize on the hyperscaler moment. And that specifically has the fact that they could, you know, create data centers for AI, right? They themselves, because they're already in the server business as it is, right? They already have warehouses. They have data centers all around. They have CDNs. And so they're actually well positioned. So having this separation allows them to pursue that much more specifically and more efficiently, right?

23:46Without having to deal with, right? And I think that's where for Comcast the opportunity was. It's not just like the electric utilities, the power companies who are making bank off the Hyperscales. It's in the chip makers. It's also like there are random, you just mentioned CDNs, which I have to admit I hadn't thought about CDNs in like a decade. But like, yeah, suddenly like RAM is up in value. Everything is going up and like CDNs are something everyone wants now.

24:10Felix Salmon: Wait, what's a CDN? I didn't catch that. Content delivery network. Basically, how you get the Internet is all these through distributed sort of, you know, servers everywhere. where, and so there's a lot of computing power, right? And that's exactly what AI needs now. There's this lack of computing power, period. And so everyone's hungry for it. We're trying to build out more data centers to do it. Comcast, I think, is well-positioned. I mean, if all birds can pivot from wool and rubber to data centers and, like, be worth whatever the hell that happens, like, certainly Comcast can do it, right?

24:43Fire with that. So, okay. So we've talked a bit about the strategy, and I just want to talk about the sort of tactics a bit here. Comcast, first of all, spun off this thing called Versant, and now it's spinning off this thing called NBCUniversal. Did they know they were going to do the second thing when they did the first thing? That is a great question. I don't have any reporting on that. However, if I were wargaming it out, yes. Part one and part two, I think they planned that well before. Okay, so let's assume that Brian Roberts was not just making this up as he goes along, and he had some kind of grand plan here.

25:20Explain, with the benefit of hindsight, why he would have done this. And also, while you're at it, can you please tell us, what is a versant? Is it a bit like a tronk or an oath?

25:33Felix Salmon: RIP. Remember that era when there were all these companies trying to come up with new names for, you know, I think the Verizon HuffPost period had that sort of, there was some of that as well. Yeah, they were oaths. That's oath. Well, you have to get the top-level domain on the internet, and so you have to just start making upwards. Right. I can't tell you what a versant, you know, quote-unquote, is, but basically it's the stuff that no one wanted in the company, right? I was, like, listening so hard. This is not me saying this. This is just what investors were saying. Right? I'm not anyway trying to take a reverse, and I think, you know, it's a really interesting company, and they've got a lot of opportunities.

26:15But basically, it's the cable networks, right? And so they were like, why do I, you know, no one wants cable networks right now. It's the part of the business that's declining, right? Cable operators don't want it. Are there any, does Versant have any cable networks that, like, our Slate Money listeners will have heard of? CNBC. CNBC.

26:32Felix Salmon: MSNail. So, like. That was the MSNBC spinoff. Okay, I'm caught up. So, but interestingly, those two are news channels. And right now in particular, for political reasons, is a particular time when no one wants to own a news channel. Because the cable fiend in chief hates people being rude about him on the news. And whenever there's news, people are rude about him. And so, like, no one wants to be the messenger right now into the White House. And so, like, no one wants a cable channel. No one wants a cable channel. No one wants a news cable channel in particular. Yeah, no one wants a news cable channel.

27:10If you have like TNT or something, then that's fine. Right. Which if you've got sports, that's great. But the news part, which is why when Disney bought Fox, it did not include Fox News. Right. For one. I mean, there would have been some man-a-dressed around that anyway. But like with Paramount buying Warner Brothers, that's a really interesting thing because of CNN now being part of that fold. Which it looks like for current moment, like David Ellison is fine, wants to have as part of this thing. He already has CBS, right? Like how much worse can it be? For him. If you're already taking the pain for it, might as well double down, right?

27:44Felix Salmon: Does that make sense? Are we going to listen in 10 years and be like, well, that didn't make sense? Well, if you think about it, like it's a, and this is just me speculating, right, potential leverage point for David Ellison, right, given just, you know, Trump's penchant for cable news, period. And so you now have a direct, almost a direct line, right, to the White House through these outlets. So I think, you know, in that sense, maybe it's astute. I don't know that that's his calculation. I don't know what the calculation is. I would like to know, certainly. David Allison, if you're listening, give Ed a ring.

28:16Paul Ed. Paul Ed, let him know what you're thinking. But, okay, so first of all, Brian Roberts is like, literally no one wants these cable channels. So I'm going to spin them off into a thing called Versant, and then that'll trade on the stock market, and maybe some random billionaire will wake up one morning and decide they want to own it, But for the time being, it can just pootle along happily, offending no one or offending everyone and no one cares. And then the big thing happens, which is I split off all of this stuff, all of the media stuff from the cable companies. So you've taken for, you know, what would have been essentially here's the cable operation.

29:00Here is the media operation. The media operation had NBC, MSNBC, CNBC, all the cable networks as well. So he thought, let's move the cable networks as its own thing. It's just a much harder business, frankly, and maybe would be just better as a separate thing. NBC is a TV business, but it has NFL rights. It has all this great Olympics. It's still on. It's one of the most distributed networks still, period, out there. That's really great. I didn't realize it was like, I thought they all had pretty much the same distribution. Well, arguably, broadcast is always slightly higher distribution than cable, right?

29:35Because not every... Sure, but I just assumed that NBC and ABC and CBS and Fox and Telemundo were all like... Yes, they all have the same distribution. But again, it's like relative to cable networks, the broadcaster is always going to be more valuable for that reason. And so therefore, that's why that remained within NBCUniversal. So you've got that, Universal Studios, and the theme parks. And maybe not NBC so much, but the Universal Studios and the theme parks relate to each other the way that it does at Disney. And that is truly the hugely valuable part of that business. So basically it's Royco.

30:09It's Royco. It's absolutely Royco, right? And, you know, the NBC part is interesting because, you know, you mentioned Netflix, right? And everyone's pegging Netflix as a potential acquirer of NBC Universal. Maybe. But if I were Netflix, I don't know that I want NBC, right? I don't want the headache of managing a broadcast company. You would prefer that that had been spun off into versions as well. Also because NBC includes, am I wrong about this, NBC News, which is the whole thing we were just talking about. It includes a fucking news channel and no one wants to own a news channel. So that's its own kind of liability that I'm sure Ted Surroundis is like, I don't want that.

30:47At the same time, the only sort of thing, the caveat to that caveat is Netflix is now selling advertising. and they do well in the evenings during primetime hours, but they don't do well during the daytime, during the day part hours. They don't have programming that appeals to people for during the day. And NBC still has that, right? And so arguably, bundling that ad inventory in with the regular Netflix inventory maybe helps to boost their ad business. So Ted does have this issue of like, now I sell advertising, I have to think broadly about how content works. And so maybe he does want NBC in that sense, right?

31:23So that, again, but if I were him, those are the calculations I'd be making. As you say, the cable companies are all like U.S. monopolies, but they're still just regional within one part of one country in a way that something like Netflix or Disney is genuinely global. And that's, I think, where for Comcast, right, and NBCUniversal to some degree, like that's always been sort of part of their, the challenge that they've had. And same with Warner Brothers Paramount. Like Warner Brothers is a bit more international, but like it's barely, right? And so that's where Netflix is worth so much more is that they went international much more quickly, much faster than everyone else did.

32:01And so that's really where you're going to get the upside that the traditional media players haven't really done enough to invest in, right? So I think this, again, the separation gives potentially them that opportunity. If Netflix were to buy them, they could even supercharge that, et cetera. You know who was bad at going global? It was Jack Monaghy, who was in charge of— From 30 Rock? From 30 Rock, who was in charge of microwaves as well, remember? Jack Donahy. Donahy. Sorry, Donahy. Well, I mean, what's great about that whole series is the cable town. I mean, we know what cable town is right in that scenario.

32:33So they're making fun of their own owners. And I just—I think Tina Fey was great for doing that.

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36:00like David Beckham, Terry Henry, and Ronaldinho, Christian Pulisic, Lamine Yamal, and Alphonso Davies. Right now, get one of nine legendary cups when you order the FIFA World Cup meal only at McDonald's. At participating McDonald's, only for a limited time, while supplies last, all rights reserved, copyright 2026, McDonald's at the FIFA World Cup 2026.

36:26We're just going to stick with the media for one more segment. The World Cup, the biggest sporting event on the planet by far, it happens every four years. And every four years, some American writes a column like comparing it to the size of the Super Bowl. Because in American minds, the biggest thing you can possibly get is the Super Bowl.

36:47Felix Salmon: I mean, it's really big. I don't like your tone, sir. There's only one Super Bowl in this country. Okay. And it is undoubtedly true that, you know, the Super Bowl is a popular sporting event in the United States. For those of us who are like parochially American and forget that the rest of the world exists. But, Ed, the World Cup is just, it's not even close, right? It dwarfs the Super Bowl. Because there are so many more games just for starters. Globally, yeah. There are way many more people watching it. But you have to understand this is what's unfortunate. Like with the Olympics, right? The rights, the media rights to global events always command higher dollars in the U.S.

37:24than any other region because of the way our media market works. So, yes, globally speaking, World Cup is big, but where do most of the dollars come from still? Except that Fox apparently got a billion dollar discount on the media rights to the World Cup because of a whole meshugas about the rescheduling of the Qatar World Cup four years ago. There was this wonderful story in the Times about how at some point folks at FIFA realized, and I hope you're sitting down for this because you might not realize it and it might come as a shock to you, and an emirate in the Gulf, like Qatar, that was hosting the World Cup, gets hot in the summer.

38:02I mean, this is a shock to all of us, I know, but it gets hot in the summer. And so then if you're going to have a summer sporting competition there, that was going to be really hard because it would be like 140 degrees in the stadium and no one could play. and that would be a bad thing. So they moved it to November, December, which made sense in terms of allowing people to play football. It did not make sense in terms of the Fox economics because November, December, there's a whole bunch of other sports ball going on in America. Real football. God's favorite football. There's like a summer lull when they can squeeze in the World Cup and like everyone watches the World Cup, but they reckon they were going to make less money from a December World Cup than they would have done from a June World Cup.

38:44And so they started bearing their loyally teeth at FIFA. And FIFA was like, listen, to make it up for you, we'll just quietly extend your rights through 2026. And so they got the 2026 rights like$450 million or something, which is a complete bargain. And it's probably about a billion dollars less than it would have gone for if it had gone for market rate. So they got that, but they also got the hydration breaks. And they got the hydration breaks. I mean, they just... No, that's massive, I think. The hydration breaks are not a small thing. How did they get the hydration breaks? That's insane.

39:14Felix Salmon: Can you explain? Because I don't follow this. So the cliche is, if you watch English soccer, the TV cliche that everyone thinks is hilarious, but I don't know why everyone thinks it's hilarious, is to call it a game of two halves. It's a game of two halves, Brian. And now what they have done is they've split each half into halves. So that makes it a game of four quarters. And guess what they've done in between each half of each half? They've put ads and they're calling the ads hydration breaks. So there weren't ads before? Not in the middle of a half, no. So the other thing. So un-American. So un-American.

39:52Because here's the thing about American sports is that they're – especially American football is practically designed around breaks, right? Like American football, like a play is like five seconds long. And then it's like another five minutes of setting up the next play. Totally. So the amount of commercial breaks you can fit in there is just endless. whereas soccer or world football or association football as they call it like there's no stopping right they're just they're just running around for 45 minutes crazy okay well this makes more sense to me an american so what happened on tuesday night there was a mexico ecuador game in mexico which was delayed by an hour because of weather and when the delay kept on delaying They announced, well, in order to make up for the fact that this is delayed, we're going to get rid of the hydration breaks, partly because this game was happening at like nine o 'clock at night at that point.

40:46And they didn't need the hydration breaks and partly because it was already delayed and yada, yada. Guess what happened? They had the hydration breaks.

40:54Felix Salmon: Because the ads, they needed to run the ads. Yeah, because the advertisers were like, you can't get rid of this. We have bought that fucking hydration break. They're ad breaks. Yeah. They're basically ad breaks. How many minutes are there? So it's three minutes. They're shoehorning an extra six commercials worth, right? And then stoppage time in each half is a minimum of three minutes. You know that when it reaches— You have to add that three minutes back and then however long. When it reaches like 90 minutes and you're like, the whistle's going to blow. Well, it's not going to blow until at least 93 minutes because there was a three-minute hydration break.

41:24Felix Salmon: I'll pretend to understand what stoppage is. I mean, basically, there's more chances for money, right? That's really what it comes down to. I will say this. I actually think the World Cup's been great this year so far. It's just like the plays are amazing. You've got like these really great players that are all performing fairly well, like up to what you expect them to be doing. And, you know, it's in the it's on East Coast, West Coast, New York, basically U.S. time. Right. So there's no excuse for an American to not watch these games. They're happening at eight o 'clock at night or in the afternoon where you can during your lunch break.

41:54So everyone can really watch. So here's the thing. Like, yes, ratings wise, it's done well. But like there are 16, 17, 18, 19 million views. Right. For for some of these games, especially when the U.S. plays, which is nice. But that's like a weak Thursday night football rating. Right. Like a weak Thursday night football is 16, 17 million viewers. And that's decent. That's fine. But like, that's, you know.

42:19Felix Salmon: But maybe the comp, I mean, despite all the articles that get written every four years that Felix talked about, maybe let's be honest, like that's not the right comp. The comp is not the Super Bowl. The comp is like the Oscars maybe or the Emmys or something or just any given TV show because those numbers are better than those, right? We are better than almost every other. But also we are only at the beginning of like the round of 32 at this point. Like as this thing, you know, goes through to the quarterfinals and the semifinals and then the final. Like I think we're going to see some much bigger numbers.

42:51I will say though to agree with Ed on this one, I was in the gym on Monday evening for the Spain match. And the Spain match, because they have this long rank of TVs in the gym, and they're all showing different channels, and one of them was showing the Spain match. I'm like, that's great, for the first half. And then they just changed the channel for the second half. And it wasn't even like one of the most 15 interesting TV programs that people wanted to work.

43:26Felix Salmon: No one complained. On Monday evening. It's like, come on, people. That's terrible. You know, I will say this. You know, what media has been successful with the World Cup is TikTok or this, the internet. All like the European or non-American fans flooding America and Mexico and like marveling at, you know, this hemisphere's food and our ranch dressing. And the stadiums. Because if you're used to any stadiums anywhere else in the world, that American stadiums are something to behold. England just played Congo, or Democratic Republic of the Congo, I should say, in an air-conditioned stadium in Atlanta.

44:03You're like, holy fuck. I don't even need to worry about the heat wave. They are air-conditioning the stadiums here.

44:09Felix Salmon: I just learned about a football stadium, I think, I hope this is right, in Arizona that is real grass. It's domed and has real grass. So they have this machine, the grass stays outside, and then they bring the grass back inside for the games. Like, what? That's amazing. Only in America, kids. Only in America will we do that. Ranch dressing, air conditioning. We got it all. Portable grass. Let's not be so down on America, you guys.

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46:50You know what America is good at? Rounds dressing, air conditioning, and crypto. I see what you did there. Elizabeth, what did I do there? We are moving into the next segment, which is about how much money Donald Trump has made during this year of his presidency. 2025, he made$2.2 billion, which is, I am just going to come out and say, a lot of money to make in one year. Like, we are in the world of billionaires, and like, we've almost normalized billionaires. But a billionaire is like, that's a stock, not a flow. That's like how much you are worth, not how much you are paid. to earn 2.2 billion dollars in one year is like who the fuck has ever done that and more than half

47:39Felix Salmon: of that was crypto because of course it was yeah and it's so it's what 1.4 billion in 2025 from cryptocurrency and most of that not from being an astute trader of bitcoin or something if that is even a thing but like in his selling his own coin yeah it came from like celebre coins or something where they were just like, we'll pay you$685 million to, you know, issue a Trump coin. And no one else made money from his coins, pretty much. No, it was a classic. What do they call it? A rug pull. Rug pull. I didn't say that. Pump and dump or in some form. I mean, the thing about the way he made money off of crypto is sort of in keeping with his whole kind of business empire for years and years, which is basically selling his name, right?

48:26He's absolutely great at putting the Trump moniker on a building somewhere and getting paid for that, essentially. That and or like stakes or ties or whatever it might be that he just slaps his name on. Crypto is essentially, his coin is essentially that. It's just his name on it. And just crypto in general. He got$7 million from licensing his name to Trump watches, which is a story I love because there was that one couple who saved up and bought a Trump watch. and then it was so shoddily made that when it arrived, it was missing the T. It was a rump watch? It was a rump watch. For so long, though, you know, Trump was making money solely by licensing his name because banks were refusing to lend to him, and now he's sort of back on top.

49:10It's crazy.

49:11Felix Salmon: Well, one of the things I learned in reading about this was that he has, like, a line of credit now with, I believe, Charles Schwab, where he has... Oh, so he can day trade. This is the classic thing where what you do is all of this income is structured in such a way that it's an unrealized capital gain. And then if you want liquidity, if you want to, you know, disappear off to the Maldives on holiday or buy a Rolex or something, then you just borrow from your Charles Schwab account. And then the end, I think it's the Bloomberg piece. The last sentence is just like, oh, and Vice President Vance also disclosed assets worth more than$7 million.

49:48Felix Salmon: And I'm like, but it's a sentence. Like, is there going to be an article? Like, there's so much information. I was wondering, like, why did President Trump even file this disclosure? It's like 100 ,000 pages. The disclosure is almost 1 ,000 pages. And someone would say, like, well, he's legally required to. And then you'd be like, yes, so? Like, why did he do it, though? I don't understand. It's not Trump saying, okay, I'm going to follow the rules for once. It's that he does have a lot of institutional money managers who don't want to run afoul of those regulations. you know, places like Schwab.

50:19I think it's really more about them insisting that this be done. But we should also talk about the fact that the UAE took a 49 % investment in world liberty financial. And that was a big chunk of Trump's. Yeah, that was like$480 million or something right there. And yeah, was the plane on there? I feel like somewhere the plane should have showed up. $400 million worth of plane. Also, by the way, the plane is now like ready to go. And it happens. They're on it. I don't, I mean, again, talk about Felix being wrong. I was like, what is... Let's do that. Let's get into it. What is the point? That's its own episode.

50:54That's its own episode. I don't know what kind of magic you're bringing into this show. Thank you so much. Anytime, anytime. Everyone kind of said, received opinion, which I genuinely believed at the time when he got given the plane, was like, obviously, it will take exactly the same amount of time to turn the Qatari plane into Air Force One, as it were just a brand new Boeing, because you have to strip it down and rebuild it all anyway and make sure there aren't any bugs. It's the same work on the same Boeing 747, so why would it make any difference whether you got it from here or whether you got it from there?

51:28Turns out that you actually can get the gifted Air Force One Boeing up in the air much more quickly. And I'm not quite sure how that works or why. Right to us. I think they, didn't they spend like a billion dollars on top of that? Oh, yeah, yeah. I mean, it did cost a billion dollars, But, like, everyone expected it to cost a billion dollars, whether you used a brand new Boeing or this old one. But, like, for some reason, they saved time, if not money. Well, then, is anyone still wondering about the relative security? Or maybe that plane still does have the bugs because they didn't strip out all of the gilded exteriors because the main thing he wanted was interior.

52:09I also love that part of the reason they were willing to part with it was because it was costing them so much to maintain. And offloading debt to Donald Trump is just on brand. This is the world of a property developer. Every asset is also a liability. I will say this, Emily, to your earlier question about why would he disclose this kind of stuff. Well, think about it. This shows you how much money you've made. Your taxes shows you how much money you've lost. Right. Right. If just on a pure ego basis, there is just a really simple reason why he was willing to disclose that relative to things he was not.

52:46And actually, if you look at the thesis of the Jonathan Swan, Maggie Haberman book, like this is basically what they're saying that in his second term, Trump's main thing is just I want to be the richest and most powerful person that has ever lived in the history of the planet. And so coming out and saying, I just made$2 billion in one year and no one else has ever made$2 billion in one year, whether or not that's true, is a great way for him to feel epocally important.

53:16Felix Salmon: I think the spokesperson for the White House said something like, the president always acts in the best interests of the people or something. Like, that was their statement. It's just quite brazen to be like, look at all the money I made while I was your president and just be like. The Trump coin was definitely in the best interest of the American people. I mean, who can doubt that? Well, I also loved her declaration that Trump has not ever and never will put himself in any situation where there's a conflict of interest. The gaslighting is just astonishing. Trump's interests are our interests.

53:46Felix Salmon: It's our interests here, right? By definition, it cannot be a conflict of interest because the interest of the state is the interest of Donald Trump.

54:05We should have a numbers round. Elizabeth, what's your number? My number is 200 million, and that's dollars. And that's how much Coca-Cola bought Topo Chico for in 2017. And I mention this because, according to Eater, there is now a Topo Chico shortage, which I find heartbreaking. Isn't that just water? It's like mineral water. It's water with bubbles inside of you. Oh. Oh, it's the bubbles. Maybe it's a bubble shortage. There's apparently a shortage because they needed to bring their manufacturing process up to code for some reason. And they had to take everything kind of offline for a bit. Oh, Perrier had that as well, didn't they?

54:45Like the French government cracked down on where they were bottling. Just inject carbon dioxide into flat water. Don't try and find natural bubbles. No good can come of that. I love tobo chico, by the way. I think it's one of the best. I really do. I don't know if I've ever had it. Oh, it's great. You got to have it. It's got more bite than a lot of the other seltzers. Okay, so my number is 53 million, which is the fine that three big egg companies had to pay. Dude, that was my number.

55:18Felix Salmon: It goes with music. What are you doing?

55:27Felix Salmon: egg watch

55:31Felix Salmon: that's right it's egg watch all right Felix has stolen it I came in and I stole Emily's eggs well now you gotta do it that was the music from egg watch our 2025 segment where every week we checked in on the astronomical price of eggs and Felix today you have an update I have an update which is three companies, Calmain, Hickman's, and Versova had to pay a fine for manipulating egg prices on the official egg exchange. But people, if you thought what I'm talking about is$53 million, you are wrong. You are so wrong. Because Emily, what was it actually? 53 million eggs. The three egg producers must donate 53 million eggs to various nonprofits and food banks in addition to paying— Wait, did I write this correctly in my notes, Felix?

56:26Felix Salmon: $3.3 million? Yeah. Is that it? Oy vey. So this is a complaint from the Trump DOJ. They filed it and settled it on the same day, which was earlier this week. And the settlement was in eggs. Eggs. They paid it in eggs. That's 4.4 million dozens. Did you just do that in his head? Did you just do that in your head? No, I did that in my iPhone calculator. Very nice. Okay, well, now someone else has to go because I have to find a new number. Or we can just share that one if you want. Okay, that's fine. All right, you guys share. There's a lot of eggs go around, I guess. So do you buy this? I was going to, when it was my number, my plan was to throw it to the group and say, like, do we think this was why egg prices were so high?

57:08Felix Salmon: Or is it just like a little con? Oh, no, it definitely wasn't why egg prices were so high. It was this weird, like, dumb epiphenomenon. But, like, when there was an egg shortage, it was easier to manipulate the price of eggs. And so, obviously, that's what they did. So they were correlated, but it wasn't really the reason why there was an egg shortage. It was like a little bit of the increase was probably due to that. And then prices started coming down for other reasons. Plus, they stopped doing that. It's Trump admin PR, you know, because he keeps making argument that inflation is happening because of, you know, bad actors who are not Donald Trump.

57:43It turns out he was right. It was it was manipulation of the egg market.

57:47Felix Salmon: I mean, the Biden administration also was arguing that there was, if not price fixing, then monopoly pricing power involved in inflation. Everyone agrees. Well, because the administration has to try really hard to be like, it's not our fault. It's the company's fault. You know, it's never their fault. Well, no. It's called Cal Mainsville. All right. Edmund Lee. My number. Okay. Bring us home. This is going to sound a little bit random, but I think it's going to be interesting context and hopefully somewhere down the line it'll be good context. So my number is$1 ,117.44. Not a subject. That is the amount that the average American television watcher paid in 2016 to watch NFL football.

58:34What? That's 10 years ago. Yes. And that was like per year. So then you're wondering, what was it now?

58:41Felix Salmon: What is it now? So I'm working on that story. Oh, come on. Dude. Give me another month and I'll have you the more current number. Wait, has it gone up or has it not gone up? It's gone up a lot. What? I'm so, I'm spinning out. Also, in the sort of like safe cone of silence that is slate money, I've been talking at the Bloomberg offices about the English Premier League and the ticket prices in the English Premier League. And the way in which soccer in England has become American footballized in that it has become much more of a television watching sport than a physical spectator sport. and the price of going to a stadium and watching a football match is now not that far off the price of buying a massive tv and buying an annual subscription to the epl and so yeah i can i can kind of see how if this is the way that clubs make money now is by selling tv rights then those tv rights have to just get more expensive because otherwise how are these sports owners going to make their billions well and i'll just add one more number i mean the nfl generates 10 billion dollars a year just from media rights alone isn't that like 90 of their revenues right there yeah that's pretty much the bulk of it but like what's sort of nice for the nfl for all the different teams whether you're in a small market kansas city or a big market in new york you all get that equally right like a nice communist system that's divided equally so why Why are the big market teams worth more then?

1:00:19In a media, like the Yankees are worth more than Cleveland, you know, whatever. You know what I mean? It's like because it's just a bigger media market, right? There are more people watching and therefore you're getting more. Right. So you do get to keep the revenues from your own market. Or is it shared equally? All of the media rights are ultimately divided up equally amongst all of the franchises. But you also presumably have like merch and sponsorships and things like that. Your ticket sales in your stadium, of course, are your own. Like jersey sales, all that kind of licensing, those things are your own.

1:00:52But the bulk of the money that you make as a team owner comes from the media rights. And all the team owners share equally. I would be so annoyed if I was like the owner of the Dallas Cowboys or the Houston, what are they called? Oilers? Used to be called the Oilers, the Texans. Texans, the Houston Texans. i'd be like i have this massive media market and i have to i don't i get the same amount of money as the green bay packers yeah wow them's the brakes but like you're you're not trying trust me you're not it's positively communist i tell you it's definitely un-american also the way that also the way that they have this like oligopoly that you can never be demoted or promoted like no one can like play football well and then become an NFL team because they played so well.

1:01:39And no matter how badly you do, you can never be relegated out of the league.

1:01:44Felix Salmon: Oh, like how soccer is. Yeah, we don't do relegation here, Felix. It's just, you just don't. There's no meritocracy in this country.

1:01:54All right. I think that is it for us this week. It has been magnificent. It has been wonderful. Thank you everyone for listening. We love you. We love your emails when you send them to us, which you do by typing slatemoneyatslate.com into your device. We particularly like Jessamyn Marley because she can find egg watch music when she needs to. Many thanks, most thanks I should say, of course, are due to Edmund Lee of Reuters who is amazing. You're welcome back anytime. And we will be back next week with more Sleep Week.

1:02:56Felix Salmon: and take action across departments. Say you want to know which top performers are at risk of leaving. Just ask Rippling AI and get an instant report with supporting data such as comp ratios, recent performance reviews, tenure trends, and more. Then it can turn those insights into real action. It might recommend a 10 % spot bonus to retain a top performer based on the data. All you have to do is review the recommendation, top confirm, and the bonus is added to the next payroll run. Rippling AI understands your workforce, systems, and workflows, helping you make faster, more informed decisions across your business.

1:03:34Felix Salmon: Don't settle for AI that's all talk. Head to rippling.ai slash slate and get AI that turns insight into action. That's R-I-P-P-L-I-N-G dot A-I slash slate. Sign up for exclusive access today.

1:03:56Hey, Pablo Torre here. As a sports journalist, I've covered global sports for many years now. And there is one thing that I can promise you. Nothing compares to the World Cup. And this time, it is even better thanks to McDonald's. You have the chance to take home one of nine legendary cups when you order the FIFA World Cup meal. The cups feature some of the biggest legends in football, like David Beckham, Terry Henry, and Ronaldinho, Christian Pulisic, Lamine Yamal, and Alphonso Davies. Right now, get one of nine legendary cups when you order the FIFA World Cup meal only at McDonald's. At participating McDonald's, only for a limited time, while supplies last.

1:04:32All rights reserved. Copyright 2026. McDonald's at the FIFA World Cup 2026.