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Being a media company used to be cool. Now everyone wants out.

A broken TV

Good morning! This Tuesday, why big telecoms can't wait to get out of the media business, what Parler looks like now that it's back on the App Store, why California is investigating Tesla, and the next tech companies in line to go public.

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The Big Story

Revenge of the dumb pipes

A few years ago, the only thing to do if you ran a massive communications company was to try and get into the media game. Verizon bought AOL and Yahoo, imagining a web-delivered future of entertainment. T-Mobile bought Layer3, and announced "plans to Un-carrier your TV," whatever that meant. Sprint spent years trying to make Sprint TV a thing. And of course, nobody went harder at the entertainment business than AT&T, which bought DirecTV and Time Warner for well over $100 billion in total.

  • Even then, the moves didn't make much sense. "A big customer pain point is paying for content once but not being able to access it on any device, anywhere," AT&T's then-CEO Randall Stephenson said in 2016. But solving that pain point doesn't require owning a media company. It requires … the internet.
  • Jeff Bewkes, the former Time Warner CEO, pretty much nailed it at the time: "Narrowing either the distribution for your content or narrowing the source of content for your distribution platform is a fairly suspect premise."
  • The big plan was always to bundle: fewer bills for consumers, fewer sucks on their data caps, more reasons to stick with an ISP. But all that bundling really did was seemingly slow down innovation within the media orgs, and let Netflix and Disney get further ahead.

What ISPs really wanted was to avoid being "dumb pipes," interchangeable infrastructure with no reason for customers to stick around as it got easier to switch carriers. But then two things happened: It didn't really get easier (or more popular) to switch carriers, and the business of being a dumb pipe started to explode thanks to 5G.

  • Verizon, AT&T and T-Mobile spent a combined $77 billion on 5G spectrum earlier this year, and all are betting that new network tech will bring cars, cities and practically every inanimate object on the planet onto the internet. Suddenly the "dumb pipes" would become the world's most important infrastructure.
  • The next few years will also represent the biggest customer land-grab since the advent of the cell phone, with a huge influx of new customers looking for service. There's a clear sense within the industry that the gold rush is happening right now, and it won't last long.
  • And for AT&T to continue to compete, it needs to pay down some of its more than $150 billion in debt. The $43 billion it's getting from the Discovery deal pales next to the $85 billion it spent on Time Warner in the first place, but it'll make a dent in the bottom line.

For now, 5G is everything. The opportunity is so big that the ISPs will spend the next few years focused on it. But this industry goes in waves, and you'd better believe we're only a few years away from AT&T's splashy acquisition of some AR entertainment startup for way too much money.

Speaking of focus: Now that WarnerMedia is out of AT&T and merging with Discovery, the new corporate mashup might have a real chance to thrive in the streaming wars, Protocol's Janko Roettgers writes. Discovery still has those pesky cable channels to care about, but fundamentally this is now a giant focused on content and streaming, not dabbling in dial-up.

  • Meanwhile, Jason Kilar is reportedly negotiating his exit from the new company. Presumably that won't surprise or bother the new leadership: The New York Times reported Kilar was "kept in the dark about the deal until recent days," which isn't what you'd do if you expected or hoped to keep him around.
  • And you know who else can't resist a media play? Big Tech. Amazon is in talks to buy MGM, The Information reported, as it, too, looks to go all-in on winning some Oscars. Who needs AWS when you can have James Bond?

— David Pierce (email | twitter)


The most recent elections made it clear: Voters in both political parties support higher wages. The federal minimum wage hasn't changed in 12 years, despite significant cost-of-living increases. Amazon saw the need to do more for their employees and communities and in 2018 raised their starting wage to at least $15 an hour.

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People Are Talking

NASA administrator Bill Nelson said he's hoping more companies challenge SpaceX going forward:

  • "But Congress has got to do its part. And that is to prepare, plan for, and provide the money so we can have a vigorous competition and have more than one awardee."

Peter Thiel is spending big on Republican Senate candidates, and former Arizona House speaker Kirk Adams said it's being noticed:

  • "A lot of people didn't know if they should take Blake [Masters] seriously as a candidate before the money came in, and when the money was announced Blake became a serious prospective candidate … Ten million dollars is a pretty damn good metric."

Making Moves

Hugo Barra is leaving Facebook after four years on its Reality Labs team. His next move will be in health care tech, he said, because "society is still poorly equipped with the tools people need to really understand our health and gain control over our health outcomes."

George Farmer is the new CEO of Parler, taking over from interim chief Mark Meckler as the app makes its return to the App Store.

Peeyush Nahar is leaving Uber to run Marcus, Goldman Sachs's consumer-facing bank. Nahar also did a long stint at Amazon before running a lot of Uber's financial services teams. is going public, and filed its F-1 yesterday. Here's everything you need to know about the IPO.

Redbox is also going public, through a SPAC. It's valued at $693 million, and while yes, it's getting into streaming, it also believes DVDs ain't dead yet.

In Other News

  • Google I/O kicks off today. Two things we're looking out for: a renewed commitment to wearables and an update on Google's privacy stance. Will Google finally stand up a real Apple Watch competitor? And can it match Apple's stance on data collection? (So far, it seems, probably not.)
  • Don't miss this story on Apple's work in Chinaand the complicated questions it brings up, from The New York Times. Can the company make bold claims about privacy and human rights … and continue to operate in China?
  • Apple spends $50 million on WWDC every year, Phil Schiller testified yesterday. That number is part of Apple's case that the 30% commission developers pay actually goes toward making their experience better.
  • Amazon announced a new "WorkingWell" program, with a handful of new initiatives meant to make life better and safer for workers. The company is also creating a new series of "mindfulness practices in individual interactive kiosks" called "AmaZen," which … sure.
  • Tesla's autonomous driving is under investigation. California's DMV is looking into whether Tesla is misleading customers about what "Full Self-Driving" really means.
  • Today in "the stock market is weird": Ethan Allen's share price is spiking, because its ticker symbol is ETH and a lot of people think that stands for Ethereum. We're not quite at GameStop levels yet, but we're nearing full crazy.
  • On Protocol:Did Elon Musk really want to send you Bitcoin? The FTC found that scammers posing as Musk have tricked consumers into paying them $2 million in phony cryptocurrency schemes since October.
  • About one in 100 Bay Area marriages is between two software developers, the San Francisco Chronicle found, which is somehow both a lot and fewer than we would have expected.
  • Amazon's poop-emoji HQ2 design is too tall. The Washington Metropolitan Airport Authority said that it is 13 feet above the maximum allowable height, meaning the helix is going to have to wind its way down a bit.

One More Thing

'Rick and Morty' and NFTs

A brief throwback to "NFT of the Day" to bring you this: A new Fox series, called "Krapopolis," will apparently be "the first-ever animated series curated entirely on the Blockchain." Do you know what that means? No, seriously, we're asking.

Best we can tell, "Krapopolis" — from Dan Harmon, the creator of shows like "Community" and "Rick and Morty" — will just be a regular TV show. But it will also have a store that sells NFTs and other digital collectibles. Because this is 2021, and that's just what we do now.


"This is the first time in my life that I have dental insurance, vision insurance, [and] life insurance." Making more than $15 an hour and comprehensive benefits gives Leonardo and Amazon employees like him peace of mind and the freedom to do more — like go back to school.

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Today's Source Code was written by David Pierce, with help from Anna Kramer and Shakeel Hashim. Thoughts, questions, tips? Send them to, or our tips line, Enjoy your day; see you tomorrow.

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