TRB Live in Cannes: Publishers' Google problem

Speaker A: The rebooting show is presented by Beehive. Here's something that Beehive showed me that I think a lot of publishers in this audience need to hear. The Center Square is a nonprofit newsroom with a small internal team. After migrating to Beehive, a platform built for publishers who want to own and scale their audience, they now run 12 state and national newsletters entirely in house. No outside agency, no added headcount. Their open rates went from 52% to 72% over nine months. Click through rates increased 42.4%. RSS automation alone saved more than 15 hours a week. And the Beehive ad network added a newsletter revenue stream that previously didn't exist. One that runs without a dedicated sales team to manage it. Imagine if you are running multiple newsletters and want to see how that kind of operation actually works, go to beehive.com trb that is be e h I-I v.com trb book time with their team of newsletter and growth experts today. Thank you to Beehive. Welcome to the rebooting show.

Speaker B: I am Brian Marci.

Speaker A: I'm in Zurich airport on my way back from a week in Cannes and Euromaxing. I have to say Cannes has morphed in my 20 plus years of going there from a festival of creativity to what I like to call a carnival of capitalism. I wrote last week about why I find crying over this kind of beside the point, even if it is a little bit true. What used to be a Costa world of media has completely fragmented. It is now shards of glass. As one executive put put it to me, creatives are their own shard. Media buyers are another shard. Tech intermediaries, of course, are their shard on their yachts in the harbor. Retail media is a new shard. Of course. The giant tech platforms have taken up, uh, real estate along the beaches. There's celebrities, there's athletes, there are a lot of creators who were there last week, you name it. I know a lot of are sick of hearing about Cannes, but I did a lot of conversations during the week and so I'm going to bring some of them to you over the next few weeks because I think that you know a lot. The best case for Cannes is that it is a place where you do have a lot of these face to face conversations that are still absolutely critical. I mean, one of the things that is always stands out to me is that, you know, publishers have far smaller presences and can't. And this, this is a bit of a strange situation because you would Think publishers are absolutely critical for reaching an aud. But obviously the media industry has changed quite a bit. Most publishers are confined to little, uh, apartments they aspirationally call houses. People Inc. Is an exception. They have a lovely villa. For the third year in a row, they hosted the rebooting at their swanky villa. Sarah Fisher of Axios joined me and People Inc. CEO, uh, Neil Vogel for a little bit of a state of the industry discussion that we had to hold indoors because of the Syrian heat wave that has plagued much of Europe the past week. Neil emerged as a, uh, voice of reason in publishing over the last several years. He's always consistently said that Google owes publishers nothing while quickly diversifying people's dependence on Google. What stood out to me in this conversation I've had many with Neil over the years is just how much publishing now requires customized playbooks. You cannot apply industrial logic to media anymore. Each brand is different. What works for one will not work for another. This makes it both more interesting and also less efficient. Let's be real. The multiple playbooks Neil is running now are a far cry from the origins of the company when it was about.com as a monolith brand with a bunch of expert guides. So now Neil's betting on the enduring power of brands like People, Food and Wine, Travel and Leisure, or very well. And I think the outstanding question is, do those brands meet as much going forward to audiences that are becoming habituated to individuals and creators? And how does a company like People, Inc. Bridge that gap? We go over all of this in this conversation. As always, I welcome your feedback. I would love to hear more about the type of guests you find the most valuable. As I said, I'll have more of these conversations from Ken in the coming weeks, and I hope you enjoy them. My email is Brian the rebooting dot com. Now here's my conversation with Neil and Sarah.

Speaker B: All right, welcome to a live recording, the Rebooting Show. I'm Brian Marcy. Thank you so much for coming. Sarah has an entire bottle of rose that she's gonna drink progressively throughout this. It's really this podcast.

Speaker C: Incredible.

Speaker B: Just for context, I like that.

Speaker C: 125.

Speaker B: 125. Sarah's entering her Elvis face.

Speaker D: That's correct and awesome.

Speaker C: Sarah was here last night doing something very similar at like, 1:25.

Speaker D: Uh, yeah, yeah, yeah. Rally people.

Speaker B: Also joined by Neil Vogel, CEO of People, Inc. You're like a spokesperson now for the entire digital publishing ecosystem.

Speaker D: Neil.

Speaker C: I'm a spokesperson for air conditioning, which

Speaker B: is why we're doing this inside? Yeah, that's why we're doing this inside. So we've done this for the last, like, couple years. Sarah said it was her favorite event at cam, but I think she. I think she says that to everyone. So, Sarah, you've been ensconced at the Axios house a lot of the week. What are your sort of three storylines of the week? With the knowledge that can is a complete carnival of capitalism.

Speaker D: It's a boondoggle, but it's a, uh, very effective one for sure. Okay, big takeaways. One, the frustration with Google is real. I think that we're going to talk a little bit about that.

Speaker B: Nails Prime.

Speaker C: I don't know what you're talking about. I've never heard anything about that.

Speaker D: Two is that there's so much uncertainty. Last year there's a lot of uncertainty on the buy side. Like there's Omnicom and IPG coming together. And so a lot of the publishers were trying to navigate that. And this year there's a lot of uncertainty on the sell side. You know, Paramount and Warner Brothers are still pending. We got a deal pending with Fox and Roku. So I say that was theme number two and then theme number three. Everyone is talking about AI. Obviously, that's the hot thing, but the theme is humanity. Like humans need to be at the center of storytelling. They need to be at the center of creative. AI is an optimization, optimization tool. So those are my, my big takeaways.

Speaker B: Okay, Neil, you've had a lot of meetings this week.

Speaker C: I'll do more like trends and takeaways. I think this is. We're definitely in a post ad, uh, tech, post open web can, where everything is about.

Speaker B: Have you been to this?

Speaker C: Like, no, I have, but I'm not saying it's not bananas, but it's materially less bananas than it's been in past years. And I think that's true. And I think, uh, a lot of it is. There's a real focus, sort of. Again, everything goes in circles on content. And I define content broadly. Like, there is a ton of stuff here about sports. There's a ton of stuff here about influencers. There's a ton of. There's. There's some noise like us around brands and old school things. There is, definitely. And we see our actual business too. There's definitely a desire to invest and be around things that are real in a world where you're not sure what's real and what's not. And I don't know if that's just like self Filling because of who's here. But it's definitely something tangible and like kind of measurable for us too.

Speaker B: Yeah. So let's get, let's get into the AI stuff.

Speaker D: Right.

Speaker B: So over the years, Neil, I've, I've, I've been talking to you about Google all the time. If you can remember. You told me, I was like, you know, you're dependent on an algorithm and you said, oh, it's the most stable algorithm. Do you remember that?

Speaker C: Yes.

Speaker B: Okay. It became a lot less stable. And I've tracked like, you know, you're sort of on this sort of Kubler Ross like journey of sorts, like, you know, of grieving and there's no grief. And now you seemingly have arrived at the anger, at the anger phase. So welcome.

Speaker C: I'm not in the anger phase. So here's what I would say, and we've said this a million times. Google is under no obligation to send us a single visitor ever. Nor has it ever been. But they can't take our content to compete with us and then not send us visitors. Right. The old deal was they use our content to create their business and then the deal is we get some traffic that we can do whatever we want with, make money from. That's fine, the deal's long over. But the thing I'd like to point out is there was a time when you rightfully, and a lot of people were like, well, I don't like your business because you're 75% of your audience is from Google. And uh, their question would always be like, well, how much of the open web goes through Google? And the answer, well, 85 or 90%. And my answer like, well then we're not good enough at it. That was the right approach then. And then because of that, we were the first, some of the first people to see Google really change in 20, 18, 19 20, heading into AI and we started to do other things. And if you look at, just zoom out four years ago, these numbers are rough. 75%. 70% of our audience was from Google to websites. Now it is less than 25%. We've got 10 straight quarters of growth and a significantly larger overall audience than we've ever had. And like the two words that are my favorite words, user thriving and elite. Because my 12 year old boy always says things are thriving and things are elite, but we're thriving and our performance is elite. We're doing great. And it has nothing to do with Google. We've worked around Google, our business is way better now post Google, it has Everything to do with we have great brands and we have amazing humans that make great content and we have audiences that love our content. And that trust has been built up over in some cases like a hundred years. Better Homes and Gardens is 100 years old. I think the difference between us and a lot of other people is we have never cared what has happened in the middle. If Google is the best way to get audience, we're going to be all over Google because that's the audience telling you where they want your content. But now it's TikTok, Instagram, Apple News, YouTube, inside of Walmart ad events. We're doing all of these things that are different brands and we're doing great. Now our business is way more complicated. It used to be, yeah, get traffic, put ads on page, sell ads done. Now every one of our brands has an entirely different model and like an entirely different future that's way, way, way more complicated but more insulated, but way more diversified in way. It's a big, better, stronger business. So you know I've also railed on this like this death of media like navel gazing narrative that is the laziest effing thing that just gets written over and over and over and over and over is infuriating to me. That's not it. People just confuse businesses that are unwilling to change and use these incredible assets they have with a bad industry. It is not a bad. There's more money spent on marketing now than ever. Ever, ever, ever, ever.

Speaker B: Well, I mean look at Ken, I mean can. That's all.

Speaker D: No, but like statistically, statistically it's true. Like it's growing. I mean we just did this story. The advertising expenditure is the highest percent of nominal GDP right now than it probably ever has been. That is astonishing. Like this industry, the advertising supported industry is the biggest part of the economy that it's ever been. Now granted our uh, publishers reaping all that benefit, not all of publishers are but the ones that are seeing that growth and adapting to it are doing just fine.

Speaker B: Right. I think the thing is it's like information uh, and media has never been more I think valuable. I mean the President of the United States is a media creature. There's a lot of different ways to use media to create leverage. You know getting people to web pages to put ads in front of them is one way but there are a lot of different, different ways.

Speaker D: Right.

Speaker B: But also I think when you go around Cannes you start to recognize like how where that money is, is, is going and it's often not Obviously to publish because obviously you've got the giant tech platforms, you know, all along the beach and whatnot. Now you've got these, I don't know if you've noticed it like all the, like supermarkets and whatnot are set up also along the quaset. They're, they're in the ad game too. Of course Amazon's got a marina.

Speaker D: Yes, retail media networks and e commerce supported media is growing. And yes, the biggest marketplaces are taking a disproportionate share over everybody else. But it's barbell economics. On one side you have performance marketing and those that specialize in it growing faster than they ever have before big tech. And on the other side is premium publishers giving premium environments to brands who could not do that type of messaging in performance. You're not going to put a brand ad at A$3 CPM on Facebook. Like you want a brand ad to be here at the People Inc. Villa where actual humans are experiencing it. It's 100% viewable. And so if you're a publisher that can lean into that side of the barbell, you'll do great. If you're a publisher that refuses to lean into that side and you want to stick in the middle, display banner ads at like a $8 CPM, that is a problematic business. That business is done. And so I think the publishers that are the ones that are panicked are the ones that cannot figure out the premium unlock to further that.

Speaker C: So our business, and we've, we've known each other a long time, our business, we built our business early on, programmatic stuff because we had a lot of scale.

Speaker B: I was going to say that's what

Speaker C: we had a lot of scale brands. Now we have, now we have all these brands. Now the like the majority to the vast majority of our economics is premium because if you look at the world there's always, if you have good brands, there's always an advantage. You could find it. Here's the thing. Instagram not premium. It's a platform. TikTok not premium. It's a platform. YouTube not premium. It's a platform. You know what's premium? Food and wine and travel and leisure. And there are very, there are significantly fewer competitors in the space of what is premium media than there used to be. So combine that with the fact that when you see our brands, you know that things were made by a person. You know that someone has taste and someone has real curation that you trust. You combine all that together and you're like, we got all the ingredients For a cake. We just got to make a cake. Which means uh, we also need like the data and the intelligence and all and, but we're good at that too. And then we can have a business and, and we do like the. Just because you have a brand that people love for a hundred years, you have no divine right to exist. You, you create your place and like InStyle is our fastest growing property. It's a incredible business and its business looks absolutely nothing like InStyle 10 years ago. Literally. It's an entirely different business where people is a huge business for us and a very successful business and looks very similar to what it looked like five or 10 years ago. Adding on some, some new things. Better Homes and Gardens. One of our successful business, its number one business is licensing things in Walmart Food and wine. We're a huge events business with the classics and best new chefs. And we just bought a new property called Hot Luck which is a barbecue thing. Like you just have to like take your advantages and then fish where the fish are and you can, your brands can live in ways that people love, in ways they want them now, not like they wanted them 10 years ago. And then it can be set up for what they want in the future, which I have no idea what they're

Speaker D: going to want on the divine place. Just because we have been doing Pulitzer Prize winning journalism, which is incredible and needed for society, I.e. 10,000 word pieces, doesn't mean that every 10,000 word piece has a right to people's attention and to brand dollars. If that's not what people need in terms of their consumption patterns and consumption diets, then you are doing them a disservice. And uh, I see this on the journalism side. People are very precious about the old formats and the old way of doing things and if it's not serving the audience then you don't have a right to commercialize it.

Speaker B: Yeah. So Sarah, in your reporting, where are we with these, these AI deals? Because I want to just go back to that Neil had mentioned, you know there is a, I think a broad frustration with Google that really is centered around its refusal to separate out its crawler. So um, those don't know. I'm sure you all do know, but they have one crawler for both the AI overviews and for their search index. And they say hey, you're welcome to cut us off from the AI overviews but you're also going to get no search traffic. And even if search traffic is lower, nobody makes that deal. Now interestingly, I'm not going to say which one? Because, um, I'm going to write about it. But a publishing CEO from a large publisher told me they're going to cut off Google entirely. They're going to say, okay, no more.

Speaker D: Well, first of all, I live in Washington. I cover these issues from a regulatory perspective. Regulators understand this as an antitrust issue. The UK's Competition Markets Authority earlier this month said, google, you cannot do that. You are, we are going to force you to separate them because it's an antitrust issue in the us. I think our regulators are just a little bit far behind on understanding some of this. But we do actually have a pretty powerful news and publishing lobby and I'm sure that this is something that they're going to tackle. You asked me about the state of AI deals. Here's the linear timeline. Around 2023, 2024, publishers were still struggling from a deflated ad, uh, market post Covid. And so they saw an opportunity to strike lucrative multi year deals where they were compensated upfront to have LLMs license their content for training data. And critics said this is not smart because they will take your data and they never need to renew with you. We have since evolved, I think the LLMs have recognized as usage has increased, that users need real time answers to things that only premium publishers can provide. That includes things like real time breaking news, it includes things like local weather, it includes things like updated product catalogs. So it's not just news and information but it, you know, journalism is information. It's all kinds of premium information. And so what they started to do is strike these deals called rag deals, where it's basically we're going to pay you to get your information in real time to supply it to user queries in real time. And those are not training data deals. Some of them are coupled together but they're very fundamentally different. And I think today, uh, most publishers recognize that rag deals are the way to go. We're now entering actually a third phase, Brian, because rag deals are still mostly upfront payments. The third deals look a little bit more like a real content marketplace where we will try to figure out a way to put publishers on one side of the marketplace, AI platforms on another side of the marketplace, and in real time market demand will dictate what you get compensated for when people contact your journalism or your content through an LLM. The problem with the marketplace idea, I know Microsoft, uh, is aggressively pursuing this. I think Amazon is dabbling this, this is that in the search era, Google was the primary dominant marketplace for search in the AI era. Without Google's participation in a marketplace, it's very hard to build one that is going to actually serve most publishers and the Internet. So we need Google's participation. And with Google having one crawler for both AI and search, it's kind of their indication that they're, they're not really there yet. So we don't have a two sided marketplace right now. We're all talking about it. There are smaller platforms like Parallel that are trying to build it, but we're not there yet. And until we get some of this figured out with Google, whether it be by market pressure or regulatory pressure, we're going to be in this limbo for a long time.

Speaker C: I would add to give a little color to that. So we've done all the deals outlined. We have done some form of those with somebody and so far so good on most of them. The, the one thing I would add is the, the pay per use deals seem to be, they're a little bit more B2B they're a little bit more like industrial use cases where if you're a Fortune 500 company and you're building some sort of like LLM feature for you, you need like rights cleared content that you know is accurate that you build upon the Microsoft models which, which in that case won't require Google I think are going to head more in that direction and thousand percent correct. We, we don't, I don't care like OpenAI and Meta have paid us in sort of like the all you can eat way. We're very deeply involved with Microsoft. On the pay as you go away we have lots of little small deals out there that are not really material to us that we've done just to play around with them. We'll, we'll see where the market has evolved. But the important thing to all of this is none of this would have happened if last July we didn't block all crawlers with Crowdflare.

Speaker B: Yeah, I mean last, last year when we were outside you talked about you need to get leverage first.

Speaker C: And, and before we did it we had no leverage with all these guys being like oh well we'll be care we're. And half of them would whisper like we don't need your stuff, we're good without you. And then the other half would be like oh, we're going to be these benevolent people and do deals with you. And we were like absolutely not. We're gonna take our. If you don't, you can pay for our stuff. So we blocked and we, our current default Setting is we block every single bot unless we permission it, obviously. Except. Except Google. The minute we blocked everybody, like literally to the minute the phone started to ring, like within 30 days, everyone starts to call. Because the second thing point you made is all of the static information on the Internet is already in all the foundation models. It's gone, it's sucked up. There's nothing. So the only value is in new content. We happen to make more new content than just about anybody because we've got 40 brands and 10 of them are major. And our stuff might be like avocados are trending, like all these recipes with avocados, but that's actually what people are searching for on these LLMs. So our stuff's crazy valuable. So the, so the value of content went from back in the day super high to low and now it's getting super high again. And if you look at what, what LLMs need to survive, they need power. That is now a scarce, expensive thing. They need to build a model. The engineers are now a scarce, expensive thing and they need fresh content to make them good. We need to make that a scarce, expensive thing. And that's the future. And how that happens, I'm not totally sure. But, um, we can. I think it's going to happen. The key is we got to do something with Google to take that sort of like leverage suck out of the market. But there's an opportunity that this could be a very good day for people that make valuable, valuable content.

Speaker B: So why won't Google make a deal? This sounds free.

Speaker C: Because they don't have to. Why would they. They have no economic incentive to do anything.

Speaker D: None. They think about. They need that search ad revenue right now. They, they need that business.

Speaker C: They get mad when I jump up and down and scream and yell about it. But I'm not the only one jumping up and down and screaming and yelling and. But they don't.

Speaker D: But what.

Speaker C: It seems insane to me that all of these other foundational model guys can figure out a way to partner with us and economically pay with us and work with us, but it's just far too complicated for Google to figure out. So I. That's.

Speaker B: You're going to get a lot of grief. But why does Anthropic not get any grief? They don't seem to be because.

Speaker D: Because Google has the dominant market share in traditional search. So Anthropic does not have to worry about splitting a crawler between the traditional search, you know, ecosystem and AI. Google does. That is they're in a unique category of their Own position.

Speaker C: Yeah, we block anthropic.

Speaker B: Okay, so you would block on anthropic.

Speaker C: Here's what I say about anthropic is

Speaker D: leverage over dot dash on traditional search.

Speaker C: Well, they don't, they're, they're, again they're, they're much more focused on the B2B part of their business. Right. I think they have a consumer product that people really like. I would bet if their consumer product evolves. Well, I'm, I'm, I would bet, bet just from some body language something constructive will happen with them potentially. But that's not really been their focus and that's not the point because like yes, they can take our content but they're also not preventing us from blocking them. Now there's a million other like sneaky things people could do to get our content but that like we're blocking them.

Speaker B: Yeah. So with these deals, like obviously they're only going to go to a small number. This is not scalable. And so the question why, why is it not scalable?

Speaker D: Well, the, the marketplace is scalable. Upfront deal. An upfront deal is not scalable. You're correct in part. Not just financially. I mean OpenAI spends money like we drink water. The upfront deals are not scalable because they're not good for the publishers. So it's not going to work in perpetuity. I do think we eventually need to come to a place where there is a two way marketplace for information and the market capitalism, the market will determine what's going to rise suit of the crop again. If the majority of the Internet right now though is dependent on Google and they're not part of a two way marketplace then we are so far away from that.

Speaker C: In every creator of content or maker of content and broadly define that.

Speaker A: Right.

Speaker C: It could be uh, but any supermarket that sells stuff online could be anybody blocked all of the crawlers and was able to block Google's crawler. There would be a solution for this in 35 seconds because they wouldn't have the raw materials they need. But they can't because that's not what, that's not how this has happened yet. They can't because everything were unavailable and this was scarce. Like power. We're like engineers. We'd have a very different conversation.

Speaker D: They can't because they still need search, traditional search. Like people are still coming to their websites to traditional search. Publishers are still monetizing traditional search. So they can't, they don't have the leverage to block the crawlers. That's why the UK has stepped in from an antitrust regulatory perspective to do something about it. I just, I cannot see our regulators doing anything about this. Especially not, you know, the Trump era antitrust mentality is so wacky and so crazy right now. There's no way, maybe if, you know, if a Lena Khan mentality were to come back, perhaps, and I'm not saying I endorse it, but in the next few years, no way.

Speaker C: You've talked about this for a long time. M2 words that matter. Leverage and incentives. And right now they have all the leverage and none of the incentives, other than I'm annoying and Sarah, um, who lays this out in a way that people understand.

Speaker B: So when this moves from talking all about LLMs to agents. Right. I mean, it's still a very niche thing with agents, but there's, there's, there's like millions of these running around. Right. Like, I mean, won't you end up having like a parallel Internet for like humans and for agents? I mean, Cloudflare says that already the majority of traffic are bots and.

Speaker C: True. For a long time.

Speaker B: Yeah. But like, I'm, I'm just wondering like when, when people are using agents and again, it's, it's pretty niche now, but to go out and retrieve information and to, uh, bring them back like the information that they need in a little package and not using like a generic LLM that's, you know, fully personalized, it would seem like there needs to be, you need to go beyond licensing into an entirely different economic arrangement.

Speaker D: But that's why I'm saying the marketplace model is that because if you think about Amazon, I used to go to Target and physically browse the aisles for different toothpastes. Now I go to Amazon. They, through their marketplace have things that are sponsored that rise to the top, but they also are curating various toothpastes right there on the page. They are my marketplace that I am exchanging quality content for as a human. The exact same thing will happen in the AI era, except I will be deploying my personal bot to be doing that shopping or getting that information that the trust question is a real one. Am I going to trust that my bot is actually going to get me the best deal? And that's where creating premium content, content marketplaces is going to really, really matter. And having a premium brand will really matter, but it's not going to actually fundamentally be that different from what exists today. I think that there's this idea that we're entering this whole new world. It's actually the same thing over and over, over just different tools.

Speaker C: This is boring when people agree. But I uh, I agree with that. The. Although I have no idea what's gonna happen with bots or with anything. But the, the, the thing that like people don't understand is there's a huge disconnect between what AI people want to build and what humans want to use and how they behave. Like take shopping for instance. Like agentic shopping. If you need to do the vocabulary change and just call it like agentic checkout, that's what it is. Like you're not having some agent go find the sweater, do put in your cart, bite for you, and then get set. That's not how it works. Like shopping is a human behavior that is, that involves like taste and curation. All this. And we're not technology denialists. But there are things that can expediate that process and make it easier and

Speaker D: make it less thousand percent.

Speaker C: But you still have to pick the effing toothpaste. And um, maybe not toothpaste but like lovely shirt that you're wearing. Like you're not. Some agent's not going to go out and find that and buy it for

Speaker D: you and do like present the options.

Speaker C: Maybe present options, that's fine.

Speaker D: At various price points around the Internet for me to make the decision. And maybe they'll get to know how I do decision making so well that one day I'll have the ability to toggle and say you can buy it on my behal. Because I trust you. Because we've been working together, AgentBot for so long that you now know what kind of toothpaste I want.

Speaker C: I don't know.

Speaker B: I mean they're solving like the hardest math problems ever.

Speaker A: This seems like it's possible.

Speaker C: Maybe it's totally possible. But also I um, don't.

Speaker D: Can I just say I am part of a delivery program and they have to anticipate usage. It's a diaper delivery program, so they have to anticipate how many diapers I'm going to go through. I trust 100% their technology to know when to deliver new diapers of the right size to my doorstep. Do they incrementally get it wrong? Sometimes. Sometimes the size is a little off. But I have not physically bought diapers since I had a kid. They just show up on my doorstep. And one could argue that on the margins, maybe you're being, you're overspending because of the marginally incorrect errors they make when they drop off the wrong size for two weeks. But ultimately the idea, the fact that I've never had to buy diapers. That is an added value to me that I think is worth the margin error. I think that's where we're going.

Speaker B: So Neil, I've noticed that ah, People Inc. I'm not allowed to talk about Neil's pivot to being a pit boss with mgm. But I've noticed that ah, it's a different podcast. Yeah, I've noticed that you started to report like non session based revenue. I found that very interesting and telling.

Speaker C: We were trying to explain to people and be super transparent about our business and for if anyone actually like reads or follows our court, we're public. So we, we each.

Speaker B: I love the grid.

Speaker D: Probably me and Brian are the only

Speaker C: two but on my slides and, and, and what we talk about is 60% of our business is the old stuff. It's basically like selling ads on websites to over, over oversimplify it. And that audience is shrinking but the rates we get for that audience are going up. So that business is about flat. That's about 40% of business and shrinking. The other part of the business, the, the 40% which we call non session based revenue is everything we do that is not websites. It is everything from TikTok, Instagram, YouTube, Apple News, the portion of our commerce revenue which is a very big part of what we do. AI licensing, all the other stuff.

Speaker D: Events.

Speaker C: Events. That is 40% of our business and growing at 25 year over year. So what our business is like if you, if you really boil it down to it is a race. It is how quickly can we take our brands that people love and do new things before this business fades? Before the, the 60% fades. Now I'm gonna get these numbers slightly wrong because it's been a very long week here in Cannes. But, but uh, the first quarter of last year the breakdown was like whatever 3842 and now it's like, like it's flipped. It's like it's the. You can do the math. The, the 40% is growing significantly faster and the mix is changing for us rapidly. That's the focus of our business. That's the power of where our brands live. And I think what we've done a very good job of is managing that transition for the session stuff where if you told me five years ago we would lose 2/3 of our Google traffic over the next three or four years and then we would grow for 11 straight quarters and we'd have a P and L. That looks like our P and L. I would be like, well something else must have happened. And what happened is like 50 different things that we've done at different brands to combat this. I think we talk about this a lot. We are, we're like, we are ruthlessly unsentimental with the things we do.

Speaker D: I love that.

Speaker C: It's not up to us. It is. Our audiences want to be in different places and want us in different places. They may still want us when they Google something, but we're not there anymore. So we got to find them in another place that they want us.

Speaker D: The, uh, the ruthlessly unsentimental part that goes back to what I was saying about the Pulitzer example is as journalists, we also have to be ruthlessly unsentimental about how people want to get our content, and we can't be precious about it. And it doesn't mean that there isn't a place, to your point, being on Google or for me, writing a beautifully well investigated report for ProPublica, like, there's definitely a place for that. But if you cannot find the sustainable business model for it, then, uh, you need to adapt. And this is why, I mean, we're not here to talk about this, but this is why I feel very strongly that for journalism, new business models also include things like philanthropy, because that might be how we have to start funding some of these deep investigative things. But the ruthlessly unsentimental part, I feel that in my core, if my boss were to come to me tomorrow and say, Sarah, we see so much business opportunity in you hosting a podcast, I'd say, yep, tell me when.

Speaker B: Don't do this.

Speaker D: If he says to me, if he said to me, we to sunset the newsletter that you've been doing for 10 years. Because that's what we think is good for the business. And I believe that I'd say, yep, if that's what's good for the business, I'll find other ways to get my audience smart journalistically.

Speaker B: Well, let me just ask you on that because I think you are like an example of like a new style journalist. And in that, ah, you do things beyond just reporting. I'm sure you've been, I haven't seen you all week. You've been out and about the Axios

Speaker D: boat doing tons of programming. I think we did like 19 events or something. I could get that number wrong. But you know what's funny? With events, I have a moral tear here because I felt this way a little bit. Sometimes with tv, there's an access component to booking, to getting someone on your stage, and you never, never, ever want to feel like you have to pull a punch to get someone to talk to you. I will never do that. Ever. The way I'm starting to see it now and think about it is you have to do quality journalism. If someone decides that they feel that they respect your journalism enough that they're going to be willing to go on your stage, then you have the most incredible opportunity to break even more news by doing a really thoughtful and notoriously difficult, challenging interview. And that there's so much value in that. You can move markets in that. I mean, I was sweating bullets on Tuesday and Monday because I had so many publicly traded company CEOs on my stage. And I. That's my audience obligation is to break the news. And so you say, I don't know, I cut you off. Sorry, Brian, I don't know what you were trying to say about traditional journalism, but the traditional journalistic principles 1000% still hold in the new mediums that I'm doing.

Speaker B: And you have principles. Yes. But what I'm saying is, like, for you as a journalist, you have to do more than just be a great reporter. Because I think, you know, when we talk about creators, and creators are a big theme here, you know, they've gotten, you know, the news creators have gotten a step on a lot of the institutional brands because they're not just writing 1500 word stories. They're out there. You're like curating rooms, et cetera. It doesn't mean that you're not like, have journalistic principles.

Speaker D: Those writers miss out on some of the opportunity that I have to deliver quality journalism in that, let's say I land a huge interview with somebody on stage. Let's take Evan Spiegel, for example. Evan rolled out specs last week. There were a lot of questions as to why he didn't do a live demo around that.

Speaker B: I can kind of see them.

Speaker D: We saw them. But I was gonna say I had an interview with him on Monday night. What an incredible opportunity in real time of him rolling these things out for me to question him on it. The person who's doing the 1500 word long form piece, which is gonna be valuable and incredible, they might not have that opportunity in that platform to ask him in real time. Which, by the way, his answer once I publish my article about it, might move the market. So even though I am doing things differently and I am, um, tasked with doing more types of things, I also have the opportunity to break news in ways that the traditional guys can't. And I play that to my advantage in trying to be the best editorial journalist that I can. And I think it's working.

Speaker C: Also, this is like. This is where also people get. And meteorites get confused. This is not an or as an end. Like, there have never been more influencers and people commentating about, like, celebrity, entertainment, whatever. People has never been bigger. InStyle hasn't been bigger in 10 years, and entertainment Weekly has never been bigger. And it has. It's just like a. Both of these things can be successful and thrive. And there's a. Probably a role for all of this now. And it's like, it's just part of what is an evolving ecosystem.

Speaker D: Quickly, I have to go, which makes me very, very sad. But I just wanted to say to you, Brian. Uh, one of the things I appreciate about this podcast and the work that you do is you are incredibly sober. Like you. And you understand. Yes. As I drink my. My champagne and Neil's incredibly sober, which is why I like talking to you guys, is that if you take a unemotional perspective, unsentimental, the word that Neil uses at all of this, what a fun intellectual challenge to be able to solve. And you will never, ever, ever feel like you can't do good journalism or you can't build great audience relationships and good products, as long as you view it from the lens of, we have a problem and we need to solve it. And we're not going to get emotional about the fact that somebody who used to be a great partner is no longer the right fit for us. And those who take that attitude and take that road are the ones that are winning.

Speaker C: I want to end on that.

Speaker D: That was awesome.

Speaker B: Yeah.

Speaker D: To go, but I love it.

Speaker B: No, no, let's wrap it up there, because I think that was great. Thank you both Sarah and Neil.

Speaker C: Thank you.

Speaker D: Thank you, Brian. Thanks, Neil.

Speaker A: And thank you all.

Speaker B: Thank you all for coming. Stay around.