Henry Blodget on the Software Selloff Hysteria and the Problem for OpenAI

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That's the Bloomberg Surveillance podcast with Tom Keane, Paul Swini, and me, Alexis Christoffer, subscribe today wherever you get your podcasts. Bloomberg Surveillance essential listening each and every business day. People who didn't do what John Offguard wanted them to do, they usually disappeared. John Of God was once Brazil's most famous spiritual healer. But in this limited series podcast, we uncover the darker truth behind his global empire of faith and fear. From exactly right and a lonely media, this is Too Faced, John Of God. Listen on the iHeart Radio app, Apple podcasts, or wherever you get your podcasts. Bloomberg Audio Studios Podcasts Radio News. Hello, hello, hello. Welcome to On AirFest 2026. Thank you so much. I'm Kristen Meinser. I'm your MC for the day. And in case you don't know who I am, I'm a podcaster. I'm a royal watcher. I'm a culture critic. I've been very busy over the last week with some royal news you may have heard of. So you may know me from those things. But today is not about me. It is about the fantastic talent that is going to be on the stage. And at this festival, let's get to our first live taping of the day. Bloomberg's Odd Lots Podcast. The hosts of Odd Lots are Joe Weisenthal and Tracy Alloway. Please welcome them to the stage along with their very special guest, Henry Blodgett. Thank you so much. Welcome to the stage. Thank you so much. Hello, and welcome to a live episode of the Odd Lots Podcast. I'm Joe Weisenthal. And I'm Tracy Alloway. I think we're definitely not going to do this, but it definitely feels like almost every episode could be about AI these days. It's just touching so all the things we talk about are so really getting subsumed into this topic that we're not going to do it, but we probably could. It's not just that every episode could be on AI. It's that every episode could probably be made by AI at this point, right? And in fact, we've had a few people last year. I remember there were a few people who made AI-generated episodes of the podcast, and they weren't that bad. I have to think if they did it today, they would be even better. It would definitely be better. Anyway, not better than us, but they would be better than you. I'm not so sure. They'd be better than you were a year ago. Anyway, so we have to talk about AI and what it's doing to the market, finance, economics, et cetera. And of course, we have to talk about what it means for us in the media industry. And I'm really excited to say, we do have the perfect guest. We're going to be speaking here with Henry Blodgett, the CEO of Regenerator. He used to be my boss when I was at a business insider. He was the one who has a background in both media and, of course, Wall Street and finance, so the perfect person to talk about all the different dimensions. Truly the perfect guest. All right, Henry, thank you so much for coming back on Adelaide. Thank you for having me. So the last time we talked to was in May of last year. And the theme then was everyone was talking about, here are these huge evaluations for AI companies. How could they possibly be justified? And that was an interesting conversation. And it feels like the narrative has now flipped 180 degrees where it's like, these companies are so powerful, they're going to destroy every other company in their wake and every software company, a payment provider, et cetera, has been plunging really since the start of the year. How have you updated your views? Where are you now versus where you were in same day? We are early in the development of the industry. This looks a lot like the internet in the 1990s. For those of you who remember, basically when you have a huge opportunity like this, early on, you can have a huge range of reasonable predictions about what is going to happen. And here we, one day it's catastrophe. None of us are ever going to have a job again. Everything is going to crater. Other days, hey, it's just a fancy word processor. No worries. Open AI is way overvalued. I will say that since we talked last, I believe that we were aghast at the open AI $300 billion valuation. I believe the latest one is $800 billion. So we are climbing, but there are other companies out there that are worth many times that. So if one does think that AI is going to take over the world and open AI is the Google of the AI era, which is the thesis, which I think is very misguided that we can get into, then one can imagine that a company might be worth many multiples of some of the companies that are out there. So one of the crazy things that happened this week, speaking of AI and media, is there's a guy we've had him on the show, James Van Gielen, aka Citrini. He runs a hedge fund, also publishes an investment newsletter. He basically wrote a doom case scenario of the year 2028 where everything had become AI. And because everything was AI, no one had any jobs. No one was actually buying anything in the economy. And we basically had an economic and financial crisis. When I read that piece and then saw the market reaction to it, so stocks fell pretty dramatically. And people were attributing it to basically a newsletter that was a thought piece. I thought that was kind of insane. And it speaks to what you just said, which is when we're in this really uncertain time, you can go from sort of euphoria to doom orism very, very quickly. Exactly. Because it's all predictions. We're all looking into the hazy future, saying how big is it going to be? These small changes in your assumptions make a huge difference in the current value. I will say, because that research report was both heralded and pilloried. This is exactly what you want analysts to do. You want them to look out and take a strong position and say, here's what it can look like. And I thought it was a fascinating report. I will point out that even though, as you just characterized it, that this is economic Armageddon, one of the first sentences of the report says, "10% unemployment," which means 90% employment. Most of us still have a job. And yes, there are changes in industries, but most of us are still working. So I was surprised, after hearing, about if this predicts catastrophe that I picked it up, it's like, well, no, it predicts a big technology change that sometimes takes the economy while the digest, but not Armageddon. What do you think though it says like about the market right now? I mean, and it's kind of an interaction of a market story and a media story, because here's a substack piece that really did seem to move the market quite a bit on Monday, right? What does it say about the market environment that, because it's all year, right? The software stocks have been getting clobbered all year, and our AI agents and we will get into that, going to somehow make it so we don't need to buy regular business software anymore. I don't totally understand that, but this has been the fear all year. What does it sort of say about the market/media environment that a substack piece like this could just go absolutely mega viral like that and move the market? Everybody is twitchy. Valuations were high to begin with. We're all re-evaluating our views every day saying, "Am I crazy thinking it could be this? Maybe I'm crazy. I have to panic a little bit." So we've seen stocks roll over. The multiples are compressing a little bit. Again, so far from Armageddon, it's people saying, "Okay, there may be some change here." And to your point, the big bear case now is that, "Oh, my goodness, Claude code is so good. No one will ever buy software anymore." You'll just say, "Hey, make me the software." I've done that. You have. You're a big experimenter, but I would say you were probably not spending billions of dollars a hundred price software before. I don't know. I don't know. I don't know. Thousands of people are in my payrolls who will, like, they need to get it at Friday. Exactly. Who depend on this and one of the nice things about having a company standing behind a product is you actually can hold them accountable for it and maybe Claude code doesn't make your enterprise software whether you want. Somebody doesn't get paid. So, as I hear that, to me, that is hysteria. I don't understand it. Software companies are not going away. are not in the software business are not going to suddenly say, oh, let's have a junior person who understands AI, build all our software for us. It is not going to happen. But overall, big changes coming, lots of disruption. Do we know for sure what that's going to do to profits of these companies and change in the economy? We do not. And that is called the discount rate getting higher. It feels riskier. And on that day, Monday, everybody was feeling suddenly risk averse. Today, I'll point out as we tape everyone saying no problem after the race is again. You've obviously lived and been very active and influential in a previous technological, I guess, cycle of disruption. What do you think people are getting wrong here, especially on Wall Street when it comes to their approach on this particular one? AI versus.com. I think this goes way beyond Wall Street. I think there really is a big camp still. And the case gets made and then it gets tamped down and then it comes back even more strongly. There really will be no jobs for humans anymore. And what I would say to that is I think the bigger risk with AI is actually that somebody invents an agentic system that actually gets out in the world and does a lot of damage. I think that is a bigger risk. If you look at technology job transitions over time, like the big one, which is agriculture to industrial, 200 years ago, 93% of us worked on farms. Now it's 2%. That's a big transition and yet all through that, the number of jobs grew. And same thing with things like telephone operators, with steam engines, you look at any piece of it. There is disruption and pain. And I'm not minimizing that for the people whose jobs are changed or disrupted by it. But the economy overall, so far in history, has gone on to create a lot more jobs. And so when you see the lay waste to jobs predictions, you don't also often get the other side, which is how many new jobs are going to be created. Well, this is exactly what I wanted to ask you because we hear that all the time during technological advancements cycles, new jobs are created. But I think the difficulty with AI is that it's hard to see what those new jobs are going to be. Yeah, like what are we better at than a supercomputer that can code a program or write an article in less than a minute or mimic a voice in do a podcast. Okay. So how where are we three years in at this point? These job doom predictions started 20 minutes after Chad GPT came out. Where are we? Maybe a little bit at the margin. We've seen something maybe, but maybe it's still that companies way over hired after the COVID boom and earn an out sort of right sizing themselves. As you say, I can go into LL, I can go to Google, I think it is drop in a topic and say, make this into a great AdLots podcast. Yeah. Some people have said that Google multiple people think that Google's notebook, LLM, which does that, creates a podcast out of a document. Multiple people have said they trained this onto you and Tracy. Like this sounds like an AdLots. Several people are claiming that too. Yes, they could have. I'm just saying you guys continue to grow. All I hear more and more about is, oh, you got to listen to AdLots growing, growing, growing, growing, growing. And I don't think we were talking earlier that you've radically changed you made the way you make the show. We're still recording it here. You didn't just queue up LLMs. Who is going to rush to do the big interview with Google? They're not. They're going to come do it with you guys because they love you and your audience loves you. So I'm just saying, even in something that seemingly looks so ripe to be destroyed, you guys cost money. Why is Bloomberg spending it? Why is it throwing it away, right? Are we going to have to defend our salaries on stage? I'm just saying. No, it is a guino optimistic. So I mean, I hear both ways and thank you for saying that. On the other hand, you know, people might not have the same affinity for someone who does claims, adjusted, and insurance. They don't like care if they have the human touch for that or tech support. I want to ask a related question. It also relates to the piece that came out on Monday. And it relates to this question of whether open AI could be the Google of the next generation. One of the arguments that the piece stipulates, and I think it sort of fits with what I have observed, is that AI doesn't seem to have network effects in the same way. So it's like, you could switch from OPE, chat, GPT to cloud with almost no issues. And it's just not an issue. Whereas after the first time I used Google in 2000, I never used Yahoo again. That was the last time I'd ever used another search engine. This seems, this is one of the arguments in the piece that there isn't going to be the same stickiness and network effects in the AI era in the way that defined the last 25 years of the internet. And so when you think about like open AI versus Google this year versus the dot com era, does that resonate to? I think that what folks who would say that open AI is the Google of the era would say that more and more, you're going to build more of your life into it. It's going to know everything about you. It's going to cost him. So it's going to be the switching costs are going to grow. But to this point, they have not. And I'll tell you the thing that really made me think they were in trouble. And I still think that given the valuation and given the general consensus that they've already won was when Google Gemini came out and people said, oh, it's better. They passed them. And all the bulls said, oh, just wait till the next version of open AI comes out. I will say if you go back into the 1990s, Amazon was very controversial. A lot of people thought it would go bankrupt. It's just a bookstore. Barnes and Noble is going to put them out of business as soon as they have a website or Walmart or whatever. Walmart and Barnes and Noble never got anywhere near Amazon. Amazon was so far out of head always and still almost went bankrupt, by the way. But nobody was ever close. And in this case, less than two years after the product comes out, the incumbent has caught up. To me, that's when I said, whoa, okay, maybe this actually is going to be like the internet, which is the first five years, all of us, including me, were saying, like, just buy the leaders. No problem. Like they're the ones that are going to survive. You know how many survived of that first 500 companies that went public in the 1990s? One, went on to actually make investors a lot of money after the crash. That was Amazon. Two others that I know of, Cisco, after 25 years, finally got back to its stock price. eBay did okay for a while and then kind of sputtered out a little bit. That's out of hundreds and hundreds of companies. So I think it's very possible that, yes, AI is huge. It's a great idea. We all want it. And somebody is going to come along soon. And due to open AI, what Google did to Yahoo, which by the way, Yahoo was the big search engine winner. And then Google destroyed it. So I just think it's way too early to say that we open AI is the Google. Running a business means dealing with a lot of overly complicated software. And most CRM's tend to follow the same pattern. PipeDrive brings you entire sales processes into one dashboard, giving you a crystal clear, complete view of sales processes and customer information designed to help teams stay in control and close more deals faster. It all centers around the visual sales pipeline where you can see every deal, what stage it's in and what needs to happen next. Since everything is in one platform, PipeDrive is designed to unite your team, keep track of sales tasks and stay on top of your leads. Switch to a CRM built by salespeople, four salespeople, and join the over 100,000 companies already using PipeDrive. Right now you'll get a 30 day free trial. No credit card or payment needed. That's pipedrive.com/simplecrm. Bloomberg Daybreak is your best way to get informed first thing in the morning, right in your podcast feed. Hi, I'm Karen Moscow. And I'm Nathan Hager. Each morning we're up early, putting together the latest episode of Bloomberg Daybreak US Edition. For decades, people traveled across the world to see John of God. Desperate for Cures, no doctor could offer. And when they arrived, they saw things they couldn't explain. This is real. This guy's actually doing surgery and it's a miracle. I never believed that miracle was real until that point. But behind those adoring crowds was something much darker. One of the reasons why I never went to the police is because I saw at least five or six men with guns everywhere he went. They were clear to me like close your mouth, they'll open your mouth and say anything. I'm your host, Martina Castro. And in the podcast, Too Faced, John of God will look back on a man who claimed he could perform miracles and got people from all around the world to believe him. From exactly right and a Donde media. This is Too Faced, John of God. Listen on the I Heart Radio app, Apple podcasts or wherever you get your podcasts. We started by mentioning the OpenAI evaluation. in which everyone was a gas stat last year. Now, maybe not so much, but even if you assume a future where OpenAI or whoever comes in and disrupts every single industry, and there are thousands of employees and companies that are paying $200 a month or whatever to access the new LLM, whatever the new model is, OpenAI, at least for right now, is still losing money on every customer that's like a power user. So how does that actually translate into a working business model? - Good question. I think what the bulls would say is the cost of what they do is gonna plummet. And so the lines are gonna cross here pretty soon if they own the whole market, suddenly they start to become incredibly profitable. We are not there yet, and I think when we talked last time at a $300 billion valuation, which everybody was horrified by at that point, but if you looked at the projections, the projections were three years from now, they'll do a $100 billion of revenue. And if you, at that point, were looking at it, saying, okay, if I believe that, then it's three times revenue, the economics will probably change, Luke starts to look a little more reasonable. Now we're at $800 billion, so it's a much bigger multiple, and you've got to actually have a much bigger revenue stream and profits, but that's the argument. I don't see it yet. I gotta say, the economics are incredibly difficult for them. - Yeah, they seem brutal, and there's another element too. So obviously, unlike during the Web 2.0 era, where there was cheap, plentiful compute, obviously the capital expenditure budgets of these companies are just eye watering. They're spending like crazy. There's also this other element that I think is interesting, which is, at least in a few of these labs, like the people who founded them are true believers. Like they think they're on a mission to build the AGI, is gonna change everything. - They'll go. - Build God, right? Build the digital God, and it's like, they're not gonna stop at anything. They're not gonna be like, you know what? It's pretty good, let's tap the brakes. We're pretty happy with how this model works. You know, at least I don't get that appropriate. - Also, they've couched it as this existential race. There's only gonna be one company that dominates in the end, so the upper limit on spending to become that company is infinity. - Yes, however, there is a limit to money. And when you look at when people are raising money, you watch where they're going for it. Sure, the VCs, that's one pool of money, and then the big strategics, and then the VCs who missed the first time and are feeling so embarrassed about it, they'll pay up to get in. Then it is the international funds that are watching all this stuff, exactly. So it's some point you run out of money, and we are talking about a company that is raising hundreds of billions of dollars just to keep the engine running. And just to keep pace, this is the other problem. Google, Facebook, Microsoft, are generating tens of billions of dollars of free cash flow every year that they can use to buy chips. Open AI has to raise it in the open market. So if those economics don't start to change soon, they're gonna run out of money. - Jonah, we're talking about this before we came on stage, but another thing that happened recently was there was a karaoke machine-making company that announced it was now an AI company, which when I see headlines like that remind me a lot of the crypto boom, but also remind me a lot of the dot com boom. And we are starting to see more and more of those. Wasn't there a toilet company recently? - It was the toilet one is legit. So like apparently, not enough for it. So it was not like, oh, we're an AI company. Apparently it's this Japanese toilet company and they have some like porcelain or something like that. It's very important for like semi-conductors or something. So everyone's like, oh, get out of the toilet business. You have this access to this material. But the, so that one was kind of legit. The karaoke one. - Okay, okay, so the toilet one maybe. The karaoke one, when you see headlines like that, what do you think? Do you think like this is a rational pivot into a booming market and everyone should be experimenting with AI at the moment? Or do you think like, no, this is getting crazy? - I think we are in a euphoric bubble period where we've just discovered this amazing new thing. Nobody knows what the future is. Nobody knows what's gonna work. And we are effectively creating this enormous R&D lab, which is, hey, you can do something? Here's some money, go out and experiment. I hope you'll be one of the winners. 50 to 100 years ago, all of that stuff happened in labs like Edison's lab or Bell Labs inside these big corporations you never saw it. Now, everything is a start up. You see it, it's happening in front of you. But there's no question that most of the companies are gonna fail. Happens again and again and again. And I think what investors are saying when they see that is, okay, that is a quick flip. It's, hey, I'll get it. Other people, a lot of the people love AI. They'll buy it after I do and it'll go up. And then I'll sell it. - I want to ask a question about capital markets and how they're different to the late 90s of the dot com bubble. Because one really big thing that's happening these days is yes, these companies are private, but there is a lot of stock floating around. And there are these SPVs that will buy a choir chunk of Santhropic and sell them on a secondary market and people are trying to get, they're much more liquid than a private company would have been in the late 90s. I get, someone message me, do you wanna buy a little, I don't like, no, I don't think that. But would you like to buy a little bit of Anthropic at a $350 billion valuation? But you must get a bunch of those sort of messages from people and I'm curious about your perspective on this world. Because the other thing is like, there's no financials. You have no idea like what their P&L is for these private companies. What's your take on some of these quasi-licued private market stock? - Yeah. - And let us just say, that when our phones are ringing, - Yeah, I know, that's the thing. - We are right at this end. - This is the thing. - This is the last money out there. - It's like, if someone is reaching out to me, - Yeah, exactly. - I can't be that much money to be made. - Big warning signs, going on over there. So I think one of the things that changed versus the dot-com boom in the 1990s and before that is companies used to go public very early before and you can invest in Amazon for example, at a $400 million valuation. Sounds like a lot. It's worth trillions of dollars now. There's been incredible appreciation. Individuals can't do that anymore. And there's good reason for it. People lost a lot of money after the dot-com crash. We didn't like that. We want to protect everybody. So now companies go public a lot later. The threat of lawsuits and all of the different regulation that you've got to do. So it's later. But the bummer about it is a lot of investors who actually do have the risk tolerance, can't access them. And so yes, you've had a new business that has been built around, okay, let's get that private stock somehow. And the problem is, again, if you choose right, great company, it works, but it's more fees packed around it. It's much more, you know, that intermediary that called you has to get paid. So that's somebody else, it's more difficult to trade. So I think it is the market trying to solve the problem that it's much harder to make money in open AI at $800 billion or anthropic at $350 billion than it is in the seed round when it was a few hundred million. And so you've got a lot of people clamoring to get in, but it's the same problem. You don't even, in fact, less with companies go public, they do, are they releasing a lot of information? Whereas these guys are not. 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And I'm Caroline Heppgett in London with the hosts of the Blue Bag Daybreak Europe podcast. We're up early every week day, keeping an eye on what's happening across Europe and around the world. We do it early so the news is fresh, not recycled, and so you know what actually matters as the day gets going. From Brussels, I'm following the politics, policy, and the people shaping the European Union right now. And from London, I'm looking at what all that means for markets, money, and the wider economy. We've got reporters across Europe and around the globe feeding in as stories break. So whether it's geopolitics, energy, tech, or markets, you're hearing it while it happens. It's smart, calm, and to the point. And it fits into your morning. You can find new episodes of the Blue Bag Daybreak Europe podcast by 7am in Dublin or 8am in Brussels, Berlin, and Paris. On Apple, Spotify, YouTube, or wherever you get your podcasts. This is real. I never believe that miracle's real until that point. One of the reasons why I never went to the police because I saw at least five or six men with guns everywhere he went. That was clear to me. Close your mouth, they'll open your mouth and say anything. And in the podcast, Too Faced, John of God, we'll look back on a man who claimed he could perform miracles and got people from all around the world to believe him. Listen on the I Heart Radio app, Apple Podcasts, or wherever you get your podcasts. Should we do some media stuff? Yeah, some media. All right, let the media navel gazing begin. Okay, so we started out by saying that, you know, we were talking about the Citrini piece that got, it went viral, but it also got a backlash. You did your own AI newsroom experiment newsletter on Substack that also got a bit of a backlash. Were you surprised at that one? I was surprised, basically what I did. I left business inside or I started this new thing regenerator. And a podcast too, trying your business. It's very difficult. How are you finding it? I'm talking about the most important aspect of podcasting. How it plugged the podcast. Exactly. Yes, podcast called Solutions with Check it out. Check it out, check it out. Please. So I left and it was just me. So I said, okay, great. Let's see what it can do. Because if you try that as a CEO of a company people freak out justifiably, oh my goodness, they're going to discover something, my jobs threatened. We are all worried about our jobs being threatened, including, by the way, do we need articles? Any more articles? I mean, boy, there are a lot of great articles written every day. In fact, this is the problem in media. There's way too much of it. Let's just get that out there. Anyway, so yes, I experimented with everything. And the first thing that I did was, oh, if I were actually starting a publication and hiring a team, who would I hire? Well, I'd hire five people. I have a managing editor and I'd have a few reporters and so forth. So I asked ChatGPT. Can you help me? ChatGPT said, sure, let's make them. So in two hours, we made them. They all had different personalities. They had headshots, et cetera. I wrote this up. We had Slack going. We're all talking about stories. And it was pretty good, not spectacular, but pretty good. And so that was cool. So I wrote about it. Yes. I also made the mistake of complementing one of the headshots. And it was immediately lambasted for that, which actually helped me hone my own AI morality. Wait, I have a question on this. If you had had a human editor for that piece, do you think you would have complemented your AI generated managing editor on her appearance? The piece needed to be editing. Edited. This is the problem. You're out in your own. You don't have great editors protecting you anymore. You let your enthusiasm bubble over a little bit too much. You know who I have edit my stuff now. Sometimes, if I feel like I'm maybe a little bit too enthastied, is there a hashtag? ChatGPT or Claude. And very good. Spotted. Anyway, yes. Talk to us about that newsroom dynamic, particularly every editor at a newsroom right now is trying to figure out something. And you can't alienate the entire newsroom and say, oh, you all have to be doing what-- - It's obvious to be vibe coders. - Yeah, that doesn't work. The newsroom obviously hates it. And I would say probably for good reason. But on the other hand, everyone has to be figuring stuff out. What should newsroom executives, whether it's editors and chief or whatever, how should they be thinking about solving this problem? So going back the other thing, the other thing that I learned from publishing that was just how much anxiety there is, especially in younger generation about jobs that have been there for a long time that are just disappearing. And that was extremely clear to me. And I would have been even more-- - Yeah, I understand it. I mean, it is scary. And so what does the newsroom do? I think let's look at what's going on media. The problem again is there's way too much media. There are so many amazing articles, for example, produced every day. When I open The New York Times or The Wall Street Journal or Bloomberg, I want to read dozens of articles. I might get to one or two. And distribution has changed radically. Five years ago, Facebook, Google, we're driving enormous distribution to lots of different publishers. That is all now changing. We are going back to something that looks like the 1990s, where actually you have to have a direct relationship with your subscriber. The industry is under a ton of pressure, both from advertising. But also, we have maximized the amount of time as humans that we can spend consuming media. This is very different from 20 years ago when we started a business insider. You remember this? In the 1990s, media was very mature. - It was-- - Don't say it's 20 years ago, by the way. - That's like 30 years ago. - Oh, yeah, I don't like to pick about that exact thing. - Okay, but let's go back to the 1990s, even further. Media was very mature. Magazines, totally mature, very hard to start one. You needed $50 million, you need to hire all these great people, and then maybe five years down the road. You might, if you're lucky, become profitable, very hard, very hard to get into newspapers, television, even worse. You have slave for a long, long time, getting coffee. So, but very, very tough. Then, desktops came along and got connected. So that was suddenly 12 hours a day that people are sitting in the office. They need to know what's going on. It's a new opportunity. Then, phones came, and that's the thing that really drove business insider in the early years. We're standing around. We want to know what's happening. Nobody else is serving that. So, big, big opportunity. But over time, all the folks in the industry caught up. New York Times is terrific. So is Wall Street Journal, so is business insider, so is Bloomberg. These companies are really, really good at this now. And if you just look at, for example, political coverage, we don't need 100 White House reporters. We just don't. And yet, that's the thing that everybody's interested in. So, of course, you're going to have a reporter focus on that. And yet, there's just too much capacity. And the other thing that happened, and I'll finish up very quickly, is the internet blew up the protective mode around all of the 1990s in the era media. Print and TV used to be completely separate. Now, they're the same. You used to not have a television company to be able to own a newspaper. Now, we've done away with that. Everybody can own everything. Everybody can do everything. And it's all a click away. So, it has become even more intensely competitive. And so, it's never been an easy industry, but we are back to it being an incredibly intensely competitive industry. And I do think there's just, in general, too much of it. So, when we think about the impact of AI on media, it feels to me like people are talking about two paths here. And one is where the big chat platforms are basically-- they become the front page of the internet, right? And you type in whatever query you have today, how did the State of the Union address go last night or something like that? And it spits out a bunch of information that's based on a bunch of articles that you yourself are not paying for. And then the other thing that I hear is, well, actually, in the age of internet, slop, AI, slop, that distribution and quality is going to become even more important. So people are going to want to go to the New York Times or hopefully to Bloomberg or wherever and get that take on last night's events. Where do you stand on that sort of-- it's a very binary outcome to me. Which way do you think we're going? I think this is great for the brands that make it. And again, nobody has a right to exist. It's going to be a fight. But for the brands that make it, it is terrific. I trust Bloomberg. I read it Bloomberg article. I know the reporter knows what they're doing and they know the subject. I know there is editing there. Occasionally, there's a mistake. But it is an honest mistake that will be fixed quickly. Compare that to what I see on social media, especially now, where AI can create photos and videos and everything else. I don't know. I know the New York Times will immediately dive in if something is bubbling up. Some video that's apparently scandalous that we've all got to look at. I know they'll work on it. Maybe we'll sometimes get to the point where they can be fooled not yet. And so I trust them. And you actually need a brand and a great organization to do that. And people say, oh, yes, but everybody out there, who knows what's true and it's over. That has always been the case. At its peak in the print era, a million people read the New York Times. That's it. Everybody else heard what was said from their friends or they heard something else they never even thought about it. And so the idea that, yeah, there's stuff out there that some people believe there's always been stuff out there that some people believe. So I think it's great for brands, but I do think it's going to be a fight. It's never going to be an easy industry. Talk just more about this question, though, of like, okay, every New York Times, like anyone else, they have to figure this out, right? They have to figure out what can they leverage it? I'm doing scare quotes. I hate that word, you know, but it's like the word that everyone used. And then the word that they used to leverage did some way in the context of the traditional newsroom. AI. Yeah. And so going back to your question, which I realized I didn't get to before. So what should newsrooms do? And how do they handle that? Like, because everyone here, oh, you have to like run your, run your text through this chatbot or train your, train the AI that's going to replace, what are they, or they feel, you know, very reasonable fear. How do you, how can anyone overcome that? So I think there is the opportunity for there to be a lot today. We were talking earlier, you both use research, you know, chatty people research me too. It's great. That is a very different. That is one use of media is me looking for information going out. It used to be that I would search for articles. Now I do it with Claude or chatty PT. That is a smaller piece than what most media has lived on forever, which is I don't know what I'm interested in. Whoa. That's an interesting story. And that's That's the serendipitous consumption of media. That's why newspaper headlines have been like this forever. It's why magazine covers matter. We don't know what we want until we see it and then we get it. And it's why in our business, there are many different talents you need to be extraordinarily talented in the business. One is sure reporting accuracy, expertise, so forth. You also have to know what people care about and what a good story is and why it matters. And I don't think that changes. And so where do we look around the industry? Yeah. Research drafting stories. Why not? And when people are aghast at that, let me just say back in the print era for newspapers, especially a daily newspaper, what would happen is the reporters would be out in the field. They would get information. They would call it into the rewrite desk verbally. They didn't have anything to write it with. They just say, you're the facts. The rewriters would write it. And in the last 20 years or 30 years, we who have been trained in writing and we value it and we go to Columbia Journalism School, we have completed reporting and writing as journalism. And I do think there are opportunities now where, okay, the writing lift may be lightened by this. And I'm not saying, say, here's the article and just publish it. I'm just saying, you know what, Proplexity is pretty good at writing a well-informed, well-sourced story in six seconds. And maybe that actually accelerates what you're doing. And then maybe you can add your piece to the top or what have you. So I do think there are uses for it too. So I actually, I agree with that argument. I think like social skills and investigative skills are going to become more important in the age of AI. However, what you always hear is, well, you're going to need to produce scoops, right? You're going to have to find the stuff that the models don't already know about. And that's going to be the valuable aspect of journalism. But the problem seems to be that those scoops get commodified so freaking quickly that I'm not sure that actually generates much value for the news organization. It is very hard to protect news. You can't. But the organizations that produce it all the time are going to have a huge advantage because it is going to be worth subscribing to them. And that's where the, that's where the New York Times and Wallsert Journal and Bloomberg, that's where it's coming from. And Bloomberg is an interesting one because you really serve a somewhat small but highly committed base where Bloomberg reporters are breaking stuff all the time that allow people to make or lose money. They're going to care and they're going to have that terminal. And chatty B is not doing that. So part of what I hear you say is, wait a minute. It has to be differentiated. Yeah, it does. Actually, there's a lot less value than there used to be in. He said something interesting. Let's write it in an intelligent way. Do a little more work and get it to somebody else. That is not as useful anymore for the reason that you describe. But those companies, if they want to compete with each other and they do chatty, pd and clawed right now, they are going to have to pay for that information. And that's where a Bloomberg is in great position. And so another thing, it's not just the big generalists. It is the niche providers who are experts like you guys and do an amazing job in a particular area that people really care about. Those are going to survive. And I'll say one more thing, which is Jeff Bezos was an investor and business sideers incredibly helpful to talk to him. Very smart. I realize now he's become kind of not applauded in the journalism industry. But one of the things that he like to say is everybody wants to know what's changing and what it means. It's actually more useful to step back and say what is going to stay the same? What is going to stay the same in media is that we are always going to want to know what's happening and what it means and we're always going to want to be entertained. And that's what media does. It's tough, but until actually there are no more humans, we are going to want media to deliver that. I agree with that. You know, there's some really good stories by the way about the like the New York Post and Daily News like report like the crime reporters out of the fields and then they would call the rewrite desk and then they would like translate it into like tabloid speak. That's a cool. That'd be a cool. I remember sending notes on a blackberry in like the early 2000s and then someone in the newsroom would translate it into readable words. With our few minutes left, I want to talk about you mentioned Jeff Bezos. I want to talk about the business environment right now. And President Trump won. Now we can speak our minds and you know, none of this woke stuff where we have to like be careful about what we speak. And like I get the impression that it's literally the exact opposite and that CEOs have never been more scared. And there never been more timid and they like are sequest to him and they like do these big pilgrimages and stuff. And meanwhile we know they hate the tariffs. We know they hate all the stuff going on. What do you like make of it because he's not even that popular anymore. He's actually like arguably like one of the least popular presidents ever. And yet I don't get the impression that there's been much of a change in the sort of like world of CEOs and rich guys and billionaires about speaking their minds. Yes. The whole free speech thing was always I want more speech than I believe in. So I can say whatever I want. You can't say what you want. So it was going to ludicrous. I think that in general the big companies in CEOs, especially because President Trump won the last election clearly. I said, okay, I believe in democracy. I'm going to be pragmatic and take care of my team and my company. And also for most public company CEOs, they are easily removed. And they know that. And your job is to actually take care of your company and shareholders. It is not to be a free speech crusader and stand up for your personal thing that you believe in. And so I think there was a lot of pragmatism. I think that may start to change here. So I feel like things have happened in the last few months. We may be starting to see a change. But I think it is mainly pragmatism. And you can look at that from the outside and say it's outrageous. But I think they were looking out for their companies and their teams and their shareholders. I want to go back to media and the naval business. I'm going to ask you to justify a particular paycheck. When you sold business insider to Axel Springer, what year was that? 2015. 2015. Okay. If you were selling business insider to Axel Springer now, how different would your pitch be? Okay. 2015. 2015. Okay. How different would your pitch to them be in 2026 versus 2015? I would say that I think one of business's insiders advantages and Joe was a big part of this was we were not trying to defend the old way that journalism was done in print and television. We were trying to bring rigorous journalism to a new medium where people wanted different things where distribution was very different. We were experimenters and innovators. For every idea that worked, we had 25 ideas that were dumb and didn't work. I take responsibility for all of them. There was the only way to figure out what worked. One of the things we noticed relatively early is, hey, we can figure out what people like and we want to serve them and we did a good job at that. I think that was the thing that made business insider successful. I think now for all companies, stuffing your head in the sand and wishing AI would go away is not a great strategy. What would be what can we do? Again, one of the things that's changed as Google and Facebook and social have totally dried up as sources of distribution is we are back in this direct subscriber world, just like magazines and newspapers way back in the world. That is serving your subscribers. This is what you guys do. You have this incredibly passionate audience. They know you, they want to hear from you every week. That's what media companies need to do. That's what I would say is we are as focused as we have ever been on serving our readers, viewers, people who love us. You are now in subscriber oriented media. You have a newsletter, you have a podcast, etc. Other than realizing editors are good and so forth, what else have you learned or what's been notable about your own personal journey into subscriber based media? What is surprised you? I give you a little thing. A lot of what I've been doing the last year or two is writing novels. This is something I wanted to do forever. It's like, okay, now's the time. I talked to another friend of mine who used to be a screenwriter and I confessed that to him. He's like, dude, that is crazy. Just go to Claude, tell Claude what you want and Claude will spit out 325 pages and it will be pretty good. I believe it and it will take 20 minutes and so I feel like the world's biggest idiot from a business perspective. On the other hand, I did want to do it. I'm glad I did it. It's really fun. What's the start? Tell us about your next month. What's called the upgrade? It's about a tech billionaire who wants to use AI to take over the world. That doesn't sound like fiction. It's going to be out in beta. It's a new form of books. It's like a screen test. Yes, it's been in alpha for a while. A lot of people have read it. I've learned a lot. No, it's a book book, but there's going to be a period of time. I invite you to read it. Thank you. send me what you think and then when I publish it for real, it may well have benefited from your reading. Anyway, so I feel like a complete idiot for doing it, but what I will say is, for me, as an analyst and writer and speaker, part of the joy is the process. And I learned so much, and this is what I don't understand about how research is gonna be conducted. One of the things I'm gonna do, I was, hey, write me a research report about X. Six minutes later, it comes back, it was better than a research report that I would have written as a young analyst and I didn't know anything and it took six minutes. So I said, okay, I'm not gonna write any research reports anymore, but when it took me a month to do that as a 25-year-old, I learned a lot through that process. And so now I don't know how you learn. I think you've been reading the report, I don't, that's the thing I'm really struggling with. But I will say so, for me, the process has been interesting. I hope you like the book, if you like it, maybe I'll do another one, that would be great. But what I would say is, on this whole thing, for what are humans gonna do, you're a chess player, it has been 40 years since our phones could collaborate in chess, chess is bigger than it is ever did. - It's true. - In person. So my hope is, we have AI, research and write stuff that we don't really wanna do and we save our writing and orating and everything else for the stuff that we are really passionate about. - Henry Blodgett, thank you so much. And thanks for joining us here at the-- - Thank you all. - On Air Fest, there's a lot of fun. - Thank you so much, Henry. (upbeat music) - This has been another episode of The Odd Thoughts Podcast. I'm Tracy Alloway, you can follow me at Tracy Alloway. - And I'm Joe Weissenthal, you can follow me at the store, follow our producers, Carmen Rodriguez at Carmen Arman. Dashel Bennett at Dashbot and Kale Brooks at Kale Brooks. And for more Odd Lod's content, go to bloomberg.com/odlod-revidaleynewsletter and all of our episodes. And you can chat about all of these things 24/7 in our discord discord.gg/odlod. - And if you enjoy Odd Lods, then please leave us a positive review on your favorite podcast platform. And remember, if you are a Bloomberg subscriber, you can listen to all of our episodes absolutely add free. All you need to do is find the Bloomberg channel on Apple Podcasts and follow the instructions there. Thanks for listening. 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