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tv   The Communicators Scott Galloway  CSPAN  November 26, 2018 8:01pm-8:32pm EST

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>> host: professor t five the old oft quoted adage what is good for them because good for the country is that fitting? we mac there is definitely a rhetoric or add narrative that is good for technology and innovators is good for america
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i think that is aft analogy. >> host: you write in your book "the four" you write these companies are not benevolent but we invite them into the most intimate areas of our lives. >> yes. if you think about who really knows you? your wife? kids? therapist or your kids i would say the real entity is google. they know if you are about to get engaged, contemplating divorce, what ailments you have or expose yourself to. google if there is a modern man god who sees everything google seizure intentions and how those are likely translated into actions these are organizations know who you are and connected with with our feelings and intentions
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with the brightest and darkest corners of our lives sumac help us figure out when these four companies that make the world a better place but yet you still refer to them as the four horsemen referring to the apocalypse's be mac we are net gainers from fossil fuels and net gainers but that doesn't mean we don't have an open conversation but some of that downside of what should be done we decided to regulate companies there should be emission standards and we have decided as a society we know whether worship at the altar and then but that key
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component of a capitalism but with that same scrutiny and regulation applied to others we would not have tolerated a lot of the behavior taken place so the four horsemen is cautionary but that doesn't mean we shouldn't have an open and honest conversation on the dat - - on the downside. >> host: at the same time you call for them? we mac yes. i don't think they are bad people or the people of the railroads or the 20th century. but there is a natural .1 or a group of companies become so powerful that they start inhibit competition that they could go prematurely euthanize
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those big companies we are at that point with these companies with one company controlling 50 cents on the dollar, two companies with google and facebook control marketing absolutely we should break up the company. >> host: give us a snapshot how many employees? what is the gdp? we mac combining 700,000 employees half of those work for amazon order fulfillment for warehouse that would loosely be described as low or median wage but facebook at 24000 employees has a market cap $600 billion.
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so with this many people with wealth concentration with the market capitalization is the equivalent of the gdp of france there is only four countries in the world have a greater gdp than the combined market cap of these four firms japan china us and germany. so the wealth is staggering with this staggering amount of wealth spread across increasingly viewed number of people. >> host: back to your book "the four" you write disturbingly few leave the economic benefits mac it's great if you own real estate in san francisco but what we see is that to teach a class
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of 160 kids every night. with the technology startup. and what do i mean by that? into work hard and play by the rules. and to aggregate a million dollars of wealth. and it has never been greater it is more difficult to come by so we live in the lottery economy we like to think we will be that one person of the pedigree to understand technology to make the jump to lightspeed but the majority of the people are statistically average and it's harder and
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harder with a smaller and smaller number of companies representing a greater amount of economic growth. amazon was responsible for 25 percent of all retail growth and digital marketing and the most exciting parts of our economy there are increasingly few companies that dominate those sectors. >> host: of those ten biggest retailers in 1990 only to remain on the list in 2016 amazon did not even come online until 1984. >> it has been extraordinary and you are right you will see more bankruptcies and retail band the previous five years so loosely described as doing
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well walmart holding on and everybody else in with those third largest employer in america there are more cashiers than teachers and one third of them lost their jobs but the store with artificial intelligence. >> let's walk through each of the companies that apple is considered the most innovative company in the world? >> they are largely credited but over the last century that some people would argue elon musk is bigger than steve jobs or thomas edison but it appeals to our need to communicate sexual strength to
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figure out a way to make them feel wealthier to signal their worth and to likely live in the city you make a good living you can spend some items that cost $300 to build that is the easiest way to signal your worthiness if you have the high-margin product. that is why with this irrational margin what we have with the margins of the luxury item of scarcity. with the production value of a toyota this quarter apple will do twice the profits in the last 90 days that amazon has registered in its entire company it is more profitable than one third of the s&p 500
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combined we've never seen a profit machine as apple with a trillion dollar market cap. >> host: were you surprised apple was over amazon? we mac yes. often i have said amazon would be the first. where i was preaching that amazon would be the first trillion dollar company so maybe an honorable mention over two or $300 billion. >> host: but you write amazon is the most reputable company? we mac it is the most trusted because they are not in the business they do a great job
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managing the brand the most trusted brand in the world. >> host: what you mean by weapon eyes? we mac if those breaching the laws imagine the trojan horse that paid for in the object of the affection. there was an apple potter amazon eco. weapon i using the object of our affection. and then to use our own - - assets we had not only built
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but the object of our affection. they absolutely have been recognized in what has become clear with these externalities they will never connect the dots to ensure the safety they will not be weapon eyes again. there will always be bad actors to say it will happen again. >> host: facebook is thought to be the best firm to work for? >> yes. there are different surveys but the average wage at amazon is 50000 because of that disproportionate amount of employees in the warehouse is but one out of three in arizona is on some sort of food stamps. the average wage on facebook is greater than $200,000. when you have 24000 people
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with a lot of investors putting in $100 billion you have extraordinary wealth creation and it's a great place to work they have a lot of resources. it is very agile. i would argue crisis management has been pretty poor with their recent actions but by all accounts i'm sure it's a great place to work but the key is when we have this conversation is it good for the country or good for the planet? >> host: you also write facebook may be the most successful thing in the history of mankind. >> sure. if it is a man-made thing that we invented and would not be produced organically i would argue facebook newsfeed is the most thing in history has been adopted by two.2 billion
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people that is more than capitalism, communism than coca-cola, it's difficult to find maybe with the exception of google any other man-made thing that has had that sort of usage or adoption. even the number of people who started the church of facebook it is greater than christianity. maybe soccer has 3 billion fans but i would say that facebook consumers are more actively engaged than soccer but i would say he was the most successful thing in the history of mankind. >> host: scott galloway you make a lot of references throughout your book why is that? >> as a species we have a need of our brain we are in the body prematurely and the brain is large enough to ask
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questions but not large enough to answer them so we ask the unanswerable and to fill that void we have manufactured those that compete to be the all knowing to give us comfort around the unanswerable. so google is a god that has stepped into a query of praying somebody praise will make it be all right so now the google dialogue box you trust google more than sending a query into the air than divine intervention that has other activity - - activity then gives back the most credible answer to your prayers in a modern economy dependent upon church or religion declined as the
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country becomes more educated and affluent we still have those needs and then it becomes somewhat of a church of the religion of innovation and steve jobs was taken from us early and referred to almost in a godlike term despite the fact the individuals here on earth as a mortal man in my view he was a pretty poor human so it is dangerous if we look at these companies to be superhuman and the reality is usually in delaware overseas for tax purposes it is not conditioned on the arm or soul but they are for profit and once we regulate them they will do anything just like tobacco did or auto manufacturers putting mercury into the river if we let them to make them more
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profitable. we need to hold them to the same scrutiny we hold every other company. >> host: is there a tobacco like addiction to these companies? >> absolutely they are very skilled at figuring out random or boards, i'm addicted to social media. i go on. i was just on msnbc to see what twitter following, youtube videos how many likes i get. i'm not addicted to social media per se but the feedback there is a dopamine bag in my pocket called my iphone i am absolutely addicted to it but at least i am aware of it so i can modulate it but the fear is some of these companies that they actively foment to put their product or service quality or function to promote that addiction but they key is
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is a bad for younger people who cannot modulate? the number of teenagers who see their friends every day are cut in half there's less drunk driving there is less teen pregnancy but the reason why they are not having sex is because we see a pretty large spike of teen depression and teen suicide we need to have that conversation of social media on the whole is good for people under the age of 18 for them to see what they are not included in or an opportunity to not be civil despite the campaign of connecting the world with this vaseline across social media to connect the world that the species can be very tribal and when you talk about young people that cannot modulate you will see
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very negative outcomes what these platforms are doing in terms of teen depression. >> host: let's talk about the issues we are debating right now that includes social media and privacy and censorship do these companies have the right to censor what is on their feeds? mac i think they have an obligation in just the way c-span does not want to give license or legitimacy to holocaust deniers but social media says they just abdicate all responsibility and let content and advertisers run free. but the reality is it gives them legitimacy one of the unfortunate things about
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species is their lives and falsehoods travel much faster than the truth and in india we have had some terrible incidents of people literally being pulled out of their cars and lynched because of false rumors spread virally on the app that facebook owns in their response to the newspaper ad to limit the number of messages i would argue if that c-span resulted in death because of false information spreading you would absolutely take that information down and mark zuckerberg in his most interview said they cannot impugn what the holocaust survivors were planning on and i would argue they are pretty content on bad activity and we have an obligation to take that content down so
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censorship in my view is a responsible media company there is nothing else like google or twitter but they have the margins of celebrity in the influence but they cannot be allergic to responsibility they absolutely take an active role to take down objectionable content resulting in violence. >> host: is it our responsibility to protect her own privacy as users? mimic i do think uber - - consumers do have a responsibility to ensure they are participating in platforms and behaving rationally but the sad truth is consumers talk a big game about privacy but don't clear their cookies and take a self he letting everybody know where they are uber knows where you are going consumers talk about supply-chain ethics they are
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horrified but a factory in bangladesh collapse but they want a little black dress for $9.99 we hope and expect to think long term for us so it's hard to regulate these companies this revolution against tobacco is not consumer related to begin taxing and regulating against manufacturing and pollution these companies in my mind they are doing their job they are for-profit entities connecting the dots and then to weapon eyes again and then continue to be compromised and what is happening on these platforms that is pretty easy to weapon eyes. so yes consumers don't always
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seem to follow through but i would argue the most effective way to foment changes to live up to the obligation of citizens and voters and election - - elected officials to hold them accountable to ensure they are subject to the same scrutiny we hold other industries. >> host: for example, with google what would you like to see done? >> i would like to see them broken up i would like to see google broken up into possibly two or three companies may be google cloud and youtube and google we want to maintain their hiring and they do create and their viscosity they have innovation with tremendous wealth they do create jobs they are the largest employer out of my class at nyu is amazon they are economic stars it is important we have billionaires
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and young people have something to aspire to they are fantastic in terms of innovation but we would shut the party down early we would keep it going by breaking up the company when we broke up ma bell in the eighties we unleashed 30 years of's shareholder growth of fiber and optics and cell phones likely that would not have happened because these technologies were lying dormant in bell labs so imagine the current system and another ecosystem apple itunes, amazon, aws amazon fulfillment messenger google youtube that echoes more hiring more job creation or a broader tax base, which ecosystem has a company to raise his hand to say as a buying proposition to stand
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out we ensure there will not be objectionable content we will make those investments to make sure no foreign government weapon eyes is a platform competition is key. markets would become noncompetitive now you have the effective of a monopoly so we need to embrace full-body capitalism and break the companies up. >> host: but aren't these monopolies a natural progression just like we are down to the big three car companies? >> sure but you have a lot of choice. i just bought a car and there's a lot of great cars out there. if you are an advertiser you want us to go to your website you will only have google and facebook if you are a consumer ultimately amazon is futile
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that i can reinvest 100 cents on the dollar into the consumer with unparalleled fulfillment and selection and movies through amazon prime video as a result nobody can possibly compete in fact, they can just look at a company with a jedi mind trick to go into pharmaceuticals of tens of millions of dollars in shareholder value even before amazon has gone into the sector you could begin killing companies even before that if it has become too powerful. so in my view nothing wrong or bad but they are what they are but just like the marketplace. just like republican teddy roosevelt. >> host: what is the key algorithm?
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>> it is illuminating to break down the assets of the culture of the competencies of the company that have a shot to get at $1 trillion and then i have the chapter on the algorithm what other components that our consistent across all these incredible companies that using that as a means to start your own business or what company you want to work for they are all great storytellers they have a result of access to cheap capital to so much extraordinary cheap capital they are usually within a bike ride but there are not that many unicorns in lubbock texas you could be near a world class university which is an outstanding school system you
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need to be seen as a good citizen typically you have to be vertical to control the consumer experience from beginning to end to control your branding with an incredible facility with data artificial intelligence, or general analytics but there is a series of attributes you could apply common across all these companies then use that as a means to identify other great companies that could someday be 1 trillion-dollar companies for example, taking the t algorithm i found two companies that i thought could potentially be trillion dollar companies identified netflix in my fifth horseman that fits that is spot if i. >> host: "the four" scott
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galloway is the author.
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