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

A year ago, all of the talk was about how the big AI companies were wildly overvalued. Everyone was calling it a bubble. Fast forward to now, and a dominant idea in the markets is that AI is so powerful that all kinds of legacy businesses — particularly software — could go to zero. So where does the truth lie? And what now for AI valuations? On this episode, recorded live at the On Air podcast festival in Brooklyn on February 25, we catch up again with Henry Blodget, the former Wall Street analyst turned Business Insider CEO, who is now the founder of Regenerator. In a wide-ranging conversation, Henry argues against the software doom scenario, and sees problems for OpenAI as it faces massive spending costs with stiff competition. Subscribe to the Odd Lots NewsletterJoin the conversation: discord.gg/oddlotsSee omnystudio.com/listener for privacy information.

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Tracy Alloway?

  There are some market stories where you want every detail. Joe and I have made quite a few podcasts on that basis. But sometimes you've only got 10 minutes and just want to know what's moving markets fast. That's the Barclays Brief Podcast. Every week, experts from Barclays Markets and Research get you up to speed on what's happening and what to watch next. Concise, focused, and brief. Search Barclays Brief wherever you get your podcasts.

• 0:26Speaker 01

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• 0:57Speaker 02

  Bloomberg Audio Studios, podcasts, radio, news.

• 1:03Tracy Alloway?

  Hello, hello, hello. Welcome to On Air Fest 2026. Thank you so much. I'm Kristin Meinzler. 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 this 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 Blodget.

• 1:48Tracy Alloway?

  Thank you so much. Welcome to the stage.

• 1:58Joe Weisenthal?

  Thank you so much. And hello and welcome to a live episode of the Odd Lots Podcast. I'm Joe Weisenthal.

• 2:04Tracy Alloway?

  And I'm Tracy Alloway.

• 2:05Joe Weisenthal?

  Tracy, we're definitely not going to do this, but it definitely feels like almost every episode could be about AI these days, right? Like, it's just touching. So all the things we talk about are sort of getting subsumed into this topic that we're not going to do it, but we probably could.

• 2:20Tracy Alloway?

  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. And I have to think if they did it today, they would be even better.

• 2:37Joe Weisenthal?

  It would definitely be better. Anyway, not better than us, but they would be better than they were a year ago.

• 2:42Tracy Alloway?

  I'm not so sure.

• 2:43Joe Weisenthal?

  They'd be better than they 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 very excited to say, we do have the perfect guest. We're going to be speaking here with Henry Blodget, the CEO of Regenerator. He used to be my boss when I was at Business Insider, someone 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.

• 3:12Tracy Alloway?

  Truly the perfect guest.

• 3:13Joe Weisenthal?

  All right, Henry, thank you so much for coming back on Odd Lots.

• 3:16Speaker 04

  Thank you for having me.

• 3:17Joe Weisenthal?

  So, the last time we talked to you 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 payments provider, et cetera, has been like plunging really since the start of the year. How have you like updated your views? Where are you now versus where you were in, say, May?

• 3:49Speaker 04

  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's going to crater. Other days, hey, it's just a fancy word processor. No worries. OpenAI is way overvalued. I will say that since we talked last, I believe that we were aghast at the OpenAI $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.

• 4:31Speaker 04

  So if one does think that AI is going to take over the world and OpenAI 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.

• 4:48Tracy Alloway?

  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 Gielan, 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

• 5:30Tracy Alloway?

  to what you just said, which is when we're in this really uncertain time, you can go from sort of euphoria to doomerism very, very quickly.

• 5:38Speaker 04

  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%. 90% employment. Most of us still have a job. And yes, there are changes in industries, but most of us are still working.

• 6:21Speaker 04

  So I was surprised after hearing about it just predicts catastrophe. That I picked it up. It's like, well, no, it predicts a big technology change that sometimes takes the economy a while to digest, but not Armageddon.

• 6:35Joe Weisenthal?

  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? Yeah. What does it say about the market environment that people? Because it's all year, right? The software, the software stocks have been getting clobbered all year. And our AI agents, and maybe we'll get into that, can 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 slash media environment? That a Substack piece like this could just go absolutely mega viral like that and move the market?

• 7:13Speaker 04

  Everybody is twitchy. Valuations were high to begin with. We're all reevaluating 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 the 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.

• 7:45Joe Weisenthal?

  Yeah, I've done that.

• 7:47Speaker 04

  You have. You're a big experimenter.

• 7:49Joe Weisenthal?

  Yeah.

• 7:49Speaker 04

  But I would say you were probably not spending billions of dollars on enterprise software before.

• 7:54Joe Weisenthal?

  I don't know, like, I don't know, like, thousands of people on my payroll who are like, they'd need to get it at Friday, you know?

• 7:59Speaker 04

  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 the way 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. Companies that 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.

• 8:44Speaker 04

  And on that day, Monday, everybody was feeling suddenly risk averse. Today, I'll point out as we tape, everyone's saying, no problem. Off to the races again.

• 8:55Tracy Alloway?

  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 dot com?

• 9:11Speaker 04

  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. That 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 grow, grew.

• 9:55Speaker 04

  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, 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?

• 10:22Tracy Alloway?

  Well, this is exactly what I want to ask you because we hear that all the time during technological advancement 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?

• 10:43Joe Weisenthal?

  Or mimic a voice and do a podcast.

• 10:44Speaker 04

  Okay, so. How, where are we? Three years in at this point? These job doom predictions started 20 minutes after ChatGPT came out? Where are we? Maybe a little bit at the margin, we're seeing something maybe, but maybe it's still that companies way over hired after the COVID boom and are now sort of rightsizing themselves. As you say, I can go into LLL, I can go to Google, I think it is, drop in a topic and say, make this into a great Odd Lots podcast. Yeah.

• 11:16Joe Weisenthal?

  Some people have said that Google, that multiple people think that Google's Notebook LM, which does that, creates a podcast out of a document. Multiple people have said, they trained this on Joe and Tracy. Like this sounds, this sounds like an odd lot.

• 11:28Speaker 04

  Other people are claiming that too. Yeah. Yeah, but yes, they could have. I'm just saying, you guys continue to grow. All I hear more and more about is, oh, you gotta listen to Odd Lots, 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 LLLMs. Who is gonna rush to do the big interview with Google? They're not. They're gonna 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, it's throwing it away, right? Are we gonna have to defend our salaries on stage?

• 12:11Speaker 04

  You're, I'm just saying, be more optimistic.

• 12:14Joe Weisenthal?

  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 at insurance. They don't really 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 OpenAI is, 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 ChatGPT to Claude 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.

• 12:57Joe Weisenthal?

  That was the, 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, OpenAI versus Google this era versus the dot com era. Does that resonate to you?

• 13:18Speaker 04

  I think that what folks who would say that OpenAI 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 customize. 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.

• 13:46Joe Weisenthal?

  Yeah.

• 13:46Speaker 04

  They passed them. And everyone, all the bulls said, oh, just wait till the next version of OpenAI 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 ahead 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 like, whoa, okay, maybe this actually is going to be like the

• 14:28Speaker 04

  internet, which is the first five years, all of us, including me, were saying like, oh, 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?

• 14:46Speaker 04

  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 do to OpenAI 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 OpenAI is the Google.

• 15:44Tracy Alloway?

  There are some market stories where you want every detail. Joe and I have made quite a few podcasts on that basis. But sometimes you've only got 10 minutes and just want to know what's moving markets fast. That's the Barclays Brief podcast. Every week, experts from Barclays Markets and Research get you up to speed on what's happening and what to watch next. Concise, focused, and brief. Search Barclays Brief wherever you get your podcasts.

• 16:10Speaker 01

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• 16:39Tracy Alloway?

  We started by mentioning the OpenAI valuation, which everyone was aghast at 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?

• 17:12Speaker 04

  It's a good question. I think what the bulls would say is the cost of what they do is going to plummet. And so the lines are going to 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 $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, 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

• 17:55Speaker 04

  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.

• 18:04Joe Weisenthal?

  They seem brutal and there's another element too. So obviously, unlike during the the web 2.0 era where there was like 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 at a few of these labs, like the people who founded them are true believers, like they think they're like, they think they're on a mission to build AGI is going to change everything.

• 18:32Tracy Alloway?

  Build God.

• 18:33Joe Weisenthal?

  Build God, right? Build the digital God. And it's like, they're not going to stop at anything. They're not going to 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, I don't, or at least I don't get that.

• 18:44Tracy Alloway?

  Also, they've couched it as this like existential race, like there's only going to be one company that dominates in the end. So the upper limit on spending to become that company is infinity.

• 18:56Speaker 04

  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 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. Yeah, exactly. So at 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.

• 19:39Speaker 04

  OpenAI 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.

• 19:47Tracy Alloway?

  Joe and I were talking about this before we came on stage, but another thing that happened recently was there is 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?

• 20:07Joe Weisenthal?

  Yeah, but the toilet one is legit. So like apparently, no, no, for real. 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 is very important for like semiconductors 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.

• 20:29Tracy Alloway?

  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?

• 20:43Speaker 04

  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 going to work. And we are effectively creating this enormous R and 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. Fifty 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 startup. You see it, it's happening in front of you, but there's no question that most of the companies are going to fail. Happens again and again and again. And I think what investors are saying when they see that is, okay, you know, that is a quick flip.

• 21:28Speaker 04

  It's, hey, I'll get it. Other people, a lot of other people love AI. They'll buy it after I do and it'll go up and then I'll sell it.

• 21:34Joe Weisenthal?

  I want to ask a question about capital markets and how they're different to the late nineties 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, acquire a chunk of Santropic and sell them on a secondary market. And people are trying to get, they're much more. Or liquid than a private company would have been in the late 90s. I get someone, someone messaged me, they're like, do you want to buy a little? I don't like, no, I don't do that. But they're like, 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. Cause the other thing is like, there's no financials. You have no idea like what their P and L is for these private companies.

• 22:17Joe Weisenthal?

  What's your take on some of this quasi liquid private market stock? Yeah.

• 22:21Speaker 04

  And let us just say, and when our phones are ringing.

• 22:24Joe Weisenthal?

  Yeah, I know.

• 22:24Speaker 04

  We are right at the end. It's the last money out there.

• 22:28Joe Weisenthal?

  It's like, if someone is reaching out to me, it's like, there can't be that much money.

• 22:33Speaker 04

  Big, 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 could 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.

• 23:17Speaker 04

  And so, yes, you've had a new business that has been built around, okay, let's get that private stock somehow. And I think, 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, 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 OpenAI 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, when companies go public, they do, or they are releasing a lot of information.

• 24:02Speaker 04

  Whereas these guys are not.

• 24:20Speaker 01

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• 24:50Tracy Alloway?

  Should we do some media stuff?

• 24:51Speaker 04

  Yeah.

• 24:52Tracy Alloway?

  All right, let the media navel gazing begin. Okay, so we started out by saying that, you know, we were talking about the Citroni 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?

• 25:13Speaker 04

  Yes, I was surprised. Basically, what I did, I left Business Insider, I started this new thing, Regenerator, and a podcast, too. Trying Your Business. It's very difficult, but fun. It's good.

• 25:22Tracy Alloway?

  This is the most important aspect of podcasting is plug the podcast.

• 25:26Speaker 04

  Yes, podcast called Solutions with Henry Blatchett. Yes, 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 job's 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?

• 26:11Speaker 04

  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 like Slack going. Where 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 complimenting one of the headshots. And it was immediately lambasted for that, which actually helped me hone my own AI morality.

• 26:41Tracy Alloway?

  Wait, I have a question on this. If you had had a human editor for that piece, do you think you would have complimented your AI-generated managing editor on her appearance?

• 26:51Speaker 04

  The piece needed to be edited. Edited. This is the problem. You're out on 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 enthusiastic. ChatGPT or Claude and very good. Spots it. Anyway, yes.

• 27:11Joe Weisenthal?

  Talk to us about that newsroom dynamic, particularly, you know, every editor at a newsroom, every, every newsroom right now is like trying to figure out something, right? And you can't like alienate the entire newsroom and say like, oh, you all have to be doing what?

• 27:25Tracy Alloway?

  You all have to be vibe coders.

• 27:27Joe Weisenthal?

  Yeah, like 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 like figuring stuff out. What should newsroom executives, whether it's editors in chief or whatever? How should they be thinking about solving this problem?

• 27:43Speaker 04

  So, I mean, so going back to the other thing, the other thing that I learned from publishing that was just how much anxiety there is, especially in the younger generation about the 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 a newsroom do? I think let's look at what's going on in 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.

• 28:21Joe Weisenthal?

  Yeah.

• 28:21Speaker 04

  And distribution has changed radically. Five years ago, Facebook, Google, were 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 Business Insider. You remember this, like in the 1990s, media was very mature. It was

• 29:00Joe Weisenthal?

  Don't say it's 20 years ago, by the way. That's like

• 29:02Speaker 04

  Thirty years.

• 29:03Joe Weisenthal?

  I don't like to think about that.

• 29:04Speaker 04

  Yeah, you, me. 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 and 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're a 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.

• 29:48Speaker 04

  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 then the other thing that happened, and I'll finish up very quickly, is the internet blew up the protective moat around all of the 1990s era media.

• 30:27Speaker 04

  Print and TV used to be completely separate. Now they're the same. You used to not have a television company 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.

• 30:55Tracy Alloway?

  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, you know, 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.

• 31:38Tracy Alloway?

  Where do you stand on that sort of, you know, it's a very binary outcome to me. Which way do you think we're going?

• 31:44Speaker 04

  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 a 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 do work on it.

• 32:28Speaker 04

  Maybe we'll sometime 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, wow, yes, but everybody out there, you know, 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 gonna be a fight. It's never gonna be an easy industry.

• 33:10Joe Weisenthal?

  Talk to us more about this question, though, of like, okay, you know, New York Times, like anyone else, they have to figure this out, right? They have to figure out, like, what, can they leverage it? I'm doing scare quotes, because I hate that word, you know? But that's like the word that everyone uses. Could it be leveraged in some way in the context of the traditional newsroom?

• 33:27Speaker 04

  AI.

• 33:28Joe Weisenthal?

  Yeah.

• 33:29Speaker 04

  And so going back to your question, which I realize I didn't even get to before. So what should newsrooms be doing?

• 33:34Joe Weisenthal?

  And how do they handle that? Like, does everyone hear, oh, you have to like, run your text through this chatbot, or train the AI that's gonna replace whatever? Or they feel, you know, very reasonable fear. How do you, how can anyone overcome that?

• 33:47Speaker 04

  So I think there is the opportunity for there to be a lot of productivity enhancements in what we have today. We were talking earlier, you both use ChatGPT for 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 ChatGPT. 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.

• 34:23Joe Weisenthal?

  Yeah.

• 34:23Speaker 04

  And 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

• 35:08Speaker 04

  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, here are 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 conflated 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, perplexity is pretty good at writing a well-informed, well-sourced story in six seconds. And maybe that actually accelerates what you're doing.

• 35:53Speaker 04

  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.

• 35:58Tracy Alloway?

  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 gonna need, you're gonna need to produce scoops, right? You're gonna 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.

• 36:26Speaker 04

  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, the Wall Street 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 gonna care, and they're gonna have that terminal. And ChatGPT 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,

• 37:09Speaker 04

  there's a lot less value than there used to be in, somebody 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 described. But those companies, if they want to compete with each other, and they do, ChatGPT and Claude right now, they are going to have to pay for that information. And that's where Bloomberg is in great position. And say 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, those are going to survive. And I'll say one more thing, which is Jeff Bezos was an investor and Business Insider was incredibly helpful to talk to him, very smart.

• 37:54Speaker 04

  I realize now he's become kind of not applauded in the journalism industry, but one of the things that he liked 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 want to, we're 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.

• 38:30Joe Weisenthal?

  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 in the fields and then they would call the rewrite desk and then they would like translate it into like tabloid speak is a, that's a cool, that'd be a cool.

• 38:45Tracy Alloway?

  I remember sending notes on a BlackBerry in like the early 2000s and then someone in the newsroom would translate it into readable words.

• 38:53Joe Weisenthal?

  With our few minutes left, I want to talk about, you mentioned Jeff Bezos. I want to talk about the business environment right now. When President Trump won, there was a lot of headlines about, you know, these CEOs, they'd be like, well, now we, free speech and 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. They've never been more timid and they like are obsequious 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 that? Because he, he's not even that popular anymore. He's actually like arguably like one of the least popular presidents ever.

• 39:35Joe Weisenthal?

  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.

• 39:44Speaker 04

  Yes, the whole free speech thing was always, I want more speech that I believe in. So I can say whatever I want. You can't say what you want. So it was kind of ludicrous. I think that in general, the big companies and CEOs, especially because President Trump won the last election, clearly, 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.

• 40:28Speaker 04

  And so I think there was a lot of pragmatism. I think that may start to change here. You think so? I feel like things have happened in the last few months. We may be starting to see a change, but I think it was mainly pragmatism. And you can look at that from the outside and say, that's outrageous. But I think they were looking out for their companies and their teams and their shareholders.

• 40:48Tracy Alloway?

  I want to go back to media naval basin because I've got more questions. And I actually hesitate to ask this one because I fear that your response is going to get back to asking Joe and I to justify our own salaries.

• 40:59Speaker 04

  I'm not. I'm telling you why you're not going to be replaced by Notebook LM.

• 41:03Tracy Alloway?

  Okay, I'm going to ask you to justify a particular paycheck, kind of. Okay, when you sold Business Insider to Axel Springer, what year was that?

• 41:12Speaker 04

  2015.

• 41:13Tracy Alloway?

  2015. Okay. If you were selling Business Insider to Axel Springer now, how different would your pitch to them be in 2026 versus 2015?

• 41:25Speaker 04

  I would say that I think one of Business Insider's 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. So we were experimenters and innovators. And for every idea that worked, we had 25 ideas that were dumb and didn't work. I take responsibility for all of them. That was the only way to figure out what worked. And 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.

• 42:10Speaker 04

  And I think that was the, 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. So what would be? What can we do? And again, one of the things that's changed as Google and Facebook and social have dry, has 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. So 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. And so that's what media companies need to do.

• 42:49Speaker 04

  So 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.

• 42:58Joe Weisenthal?

  So you're now in very subscriber oriented media. You have a newsletter, you have a podcast, et cetera. Other than realizing like, actually, you know, 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?

• 43:18Speaker 04

  Well, so I'll give you a little thing. So 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. And 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'll be pretty good. And I don't, I believe it, and it'll 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.

• 43:57Joe Weisenthal?

  What's the story? Tell us about your.

• 43:59Speaker 04

  One's coming out next. One'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 nonfiction, but it'll be out. It's going to be out in beta. It's a new form of books.

• 44:11Joe Weisenthal?

  Really?

• 44:11Speaker 04

  It's like a screen test. Yes. It's been in alpha for a while. A lot of people have read it.

• 44:14Joe Weisenthal?

  It's a different kind of book?

• 44:16Speaker 04

  No, it's a book, book, but there's going to be a period where I invite you to read it. Thank you. If you would, send me what you think. And then when I publish it for real, it may, will benefit it 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.

• 44:38Joe Weisenthal?

  Yeah.

• 44:38Speaker 04

  And I've learned so much. And this is what I don't understand about how research is going to be conducted. One of the things I'm doing with AI was, hey, write me a research report about X. Six months later, it comes back. It was better than a research report that I would have written as a, as a young analyst when I didn't know anything and it took six minutes. So I said, okay, I'm not going to 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'd be reading the report. Like 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.

• 45:19Speaker 04

  But what I would say is on this whole thing, for what are humans going to do? You're a chess player. It has been 40 years since our phones could clobber us in chess. Chess is bigger than it has ever been.

• 45:34Joe Weisenthal?

  This is true.

• 45:34Speaker 04

  In person. So my hope is we have AI research and write stuff that we don't really want to do. And we save our writing and orating and everything else for the stuff that we are really passionate about.

• 45:48Joe Weisenthal?

  Henry Blodgett, thank you so much. And thanks for joining us here at the On Air Fest. It was a lot of fun.

• 46:09Tracy Alloway?

  This has been another episode of the Odd Lots Podcast. I'm Tracy Alocke. You can follow me at Tracy Alocke.

• 46:15Joe Weisenthal?

  And I'm Joe Weisenthal. You can follow me at TheStalwart. Follow our producers, Carmen Rodriguez at Carmen Armin, Dashil Bennett at Dashbot, and Cale Brooks at CaleBrooks. And for more Odd Lots content, go to Bloomberg.com/oddlots, where we have a daily newsletter and all of our episodes. And you can chat about all of these things 24/7 in our Discord, discord.gg/oddlots.

• 46:35Tracy Alloway?

  And if you enjoy Odd Lots, 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 ad-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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