Happy Wednesday… unless you’re one of the people in NYC or Dublin who missed a chance to check out the large livestream portal installed to connect people in both cities. Thanks to some (expected) inappropriate behavior, the portal was temporarily closed… apparently to figure out a way to program a bit of moderation in what can be shared across countries. The portal is back up and running, but don’t expect that shutdown to be the last. This is why we can’t have nice things.

In other news… Netflix and Apple don’t love overpaying talent anymore, CAA builds a way for clients to control AI use, and Elon Musk realizes firing his Supercharger team was a bad idea.

We hope you enjoy this and all upcoming issues, but we have one request: please share your feedback. If you have any thoughts at all about our new look, format, and direction, please reply to this email. It’ll go straight to us. Do not hold back.

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• YouTube – Megalopolis

• X (Twitter) – Greta Gerwig

• Google – Alice Munro

• Reddit – Spider-Man: Noir

• TikTok – “Como Te Pago” - Lenier

• Spotify – “Claw Machine” - Sloppy Jane, Phoebe Bridgers

.ENTERTAINMENT.

Netflix and Apple rethink streaming talent compensation

The Future. Apple and Netflix have both started signaling that they’re going to change how writers, directors, actors, and producers get paid to make films and shows for their streamers, opting for one based on a title’s performance on the platform as opposed to just writing big checks to attract name talent. If the new models are implemented, creatives may gravitate to more cost-conscious, commercial projects that have a greater chance at becoming mainstream hits.

Performance pay
The new Hollywood will soon look a lot like the old Hollywood.

• Apple and Netflix are looking into transitioning from a “cost-plus” model (paying the talent’s typical fee plus a premium bonus) to a “performance-based” model (one where bonuses are paid when a movie or show hits a certain threshold).

• Apple told talent representatives that it’s considering three criteria for bonuses: the number of people who signed up for Apple TV+ to watch the title, how much time they spent viewing it, and the cost of the title relative to the size of its audience.

• New Netflix film head Dan Lin plans to introduce a similar model to reduce the budgets of its blockbusters — the Russo Bros.-directed The Electric State is costing the streamer about $300 million, when it would cost under $200 million at a typical studio.

Other than saving costs, streamers hope that the change will incentivize talent to put even more effort into making their projects great, knowing that the better they turn out, the more likely they’ll get paid extra. It’s exactly how box office bonuses and residuals work.

But for any of this to work, streamers will need to get a lot more transparent about viewership metrics.

69% of you voted No in yesterday’s poll: Are you a retail trader?

“I’m trying not to be because I do not make good choices.”

.A WORD FROM OUR FRIENDS AT SAGE.

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Media, Music, & Entertainment

• Paramount Global’s stock dropped more than 5% yesterday after CNBC reported that Sony may be backing out of its $26 billion bid with Apollo to acquire the conglomerate. [Read More]

• As Disney+ morphs into a general entertainment platform with the inclusion of Hulu and ESPN, its annual upfront took on a similar tone. [Read More]

• ALTR, an upcoming learning platform backed by major Black talent like Viola Davis and Charlamagne tha God, will feature short-form self-help and motivational audiobooks by Black cultural icons and authors. [Read More]

Fashion & E-Commerce

• Klarna is prepping an IPO in the US… which could turn out to be the biggest public offering this year. [Read More]

• Jo Malone London has tapped actor Tom Hardy as its newest ambassador as it prepares to make a larger push into the men’s market. [Read More]

• Forget the youth — the beauty industry’s new VIP customer may be Gen X. [Read More]

Tech, Web3, & AI

• Google announced a new open-source framework called “Firebase Genkit” that allows users to develop AI-powered apps. [Read More]

• Tesla is hiring back some of the Supercharger employees it had let go two weeks after gutting the moneymaking division. [Read More]

• Hinge is testing a new feature that forces users with more than eight unanswered messages to either reply to someone or officially end a conversation before they can match with someone new. [Read More]

Creator Economy

• MrBeast’s decision to fire his management company and build his own internal team has raised the hairs of the creator economy. [Read More]

• TikTok is testing AI-generated search results on its app, which is powered, of course, by ChatGPT. [Read More]

• YouTube CEO Neal Mohan makes the argument that creators on the platform should start being eligible for Emmys. [Read More]

.ARTIFICIAL INTELLIGENCE.

CAA partners with Veritone on a client-asset vault

The Future. CAA has struck a deal with Irvine, California-based AI firm Veritone to act as its technology partner for its “CAAVault” service — the Hollywood talent agency’s one-stop-shop solution for helping clients enter the age of AI. Don’t be surprised if some clients start to book a lot of work by exploiting the creative possibilities of CAAVault… forcing more agencies to build their own services to compete.

Generative goldmine
CAA is putting the digitally-captured talents of clients under lock and key.

• CAA has tapped AI firm Veritone to handle “ingesting, organizing, and storing the digital assets and all associated metadata” that the CAAVault captures.

• Wait, what’s the CAAVault? It’s the in-house service created last year at the Hollywood agency that digitally scans clients and records their voices so that it can store their inherent IP.

• The plan is to give clients full control over their “personal vault” to protect their likeness from AI manipulation or license it to specific projects as a new source of revenue.

Variety notes that CAA hopes to put the power of “consent, credit, and compensation related to AI usage” in the hands of talent — all major points of contention during the dual strikes in Hollywood last year.

.A WORD FROM OUR FRIENDS AT HIMS & HERS.

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• Watch: Google CEO Sundar Pichai speaks with Bloomberg about how the company is evolving its search business and doubling down on AI.

• Listen: WSJ investigates how FTX, which made money disappear under imprisoned former CEO Sam Bankman-Fried, now has enough money to repay customers.

• Read: NASA faces a dramatic challenge to bring back the Mars samples that its Perseverance rover has collected.

Does this mean we’ll finally find out why Sam Altman was fired last year?

LATEST PODCAST EPISODE

Today we get into how the h.Wood Group is getting into the media game, how MrBeast is leaving his management company, and how one company is disrupting the secondary trading market.