An hour. Welcome to the midpoint of intx 2016. We have had a great couple of days so far. We met arianna huffington, we talked with michael powell, we had a conversation with brian roberts. Quite a display he put on about the upcoming olympics and the technology. We have had conversations with john king and jorge ramos. We have celebrated terrific events and programs with cable tv pioneers. Fameable center hall of last night, outstanding. Women in cable, a great lunch. Many other groups. On the marketplace floor, we have discovered the joys and wonders of virtual reality. Of tv everywhere. And the everexpanding content display technology. We have also been immersed in news and information about the internet. And television. And imagine part. Through dozens of Panel Sessions and discussions. It is fitting that all of those developments have led to this afternoons great general session, probably the most disruptive of intx 2016. We are going to get to hear from the people who have disrupted our world with Game Changing technology and services. Fresh from the acquisition of directv, we are going to get a chance to meet at ts john stinky. We will gain insights into the world of the internet with the founder of mashable, pete cashmore. It will be an interesting conversation. And peter cap got is going to introduce us to nigel eccles of faneuil and periscope founder avon by court. Exciting lineup. You will not want to move before we moved to the chairmans reception for an adult beverage or two. To get things rolling, it is my pleasure, indeed, to welcome a. Rue friend of cable and intx the senior media and entertainment correspondence for cnbc and a shining light in news and business and an absolutely stellar journalist. Welcome Julia Roberts than. Hoboorstin. Julia i would like to welcome ano the stage john, ceo of abc entertainment. You have wanted to talk about today. [applause] yesterday, you announced acquisition of quick play. What is this company and how does it fit into entered the at T Entertainment strategy . Not a headline by straightforward. We want to deliver premium content to customers on any device wherever they are. If you get underneath the Details Behind it, 12 years ago, when we started to work into the paytv business, we have decisions to make on platforms and how we did that. A really painful decision to make to walk in and not own your stack of technology to accelerate your entrance into the business. After 12 years, what this represents is we finally have a culmination where we own the entire Technology Stack to deliver services to our endusers. That is really important. Everybody in this room understands it. We have this dynamic now where i think most people that play in this industry will play in a full stack approach. They will be all the way down at the content side working up to the Technology Stack and the Customer Experience and feel really good about the move that this completes for us in making that happen. Described to us how you see at ts approach. You have a unique position. At t has directv. What is the big picture strategy . I was chuckling backstage as they were introducing in the segment, i got put here in the middle of the disruptor discussion. Feel like it is being done to me, and not the other way around. Certainly, our approach to this is we believe that mobility is an important ingredient moving forward. We think the customers will want to do more things on the go. We think that technology is going in a place where mobility will allow them to do many more things on the go. Our desire is to take the premium Entertainment Experience and the great aspects of what people have that emotional connection with, and bring that into our mobility experience. The combination of you have great content mixed in with device specific addressability allows for new business bottles, Better Business models. Lower ad lows, better yields for folks, allow people to take content wherever they want to go. Star to do things like build scalable infrastructure that ensures people arent worried about whether they are exhausting data buckets to do the consumption that they want to do. Also, start to play into the new more fragmented digital forms of entertainment that you see the entire new jens he and millennials adopting that are definitely mobile centric. I think everybody is about Building Audience these days. We want to be in a situation where they find a way to build on to do all the things i just mentioned. To push on advertising. There are different ways to build audience. Our point of your Building Audience is it probably needs to start from a position of strength with premium content that people have a repetitive and emotional tie to and then grow from there. Our belief is when you look at the advertising business, it can be built around that, especially on addressable basis. That is a better place to be in the near term. We are to, this problem is highly different way. More from the scaled, premium content position, have a great cost, a position to be able to work with people who know how to do that and play into that from a position of strength rather than try to come from that from the bottom up. It doesnt mean the bottom up doesnt make sense and it wont be relevant over time. We already have a billiondollar plus advertising business. We will grow it into double digits by starting to apply some of the technology and capabilities that our ip capabilities allow us to bring forward. We like coming out of from that Vantage Point ember working away down. Us a bit about what honor media is. Between at t and some of these assets that they have my crunchy roll or massive. Many people dont realize how huge and powerful they are. We built a great audience and it is coming from the bottom up. These are the newer digital forms of advertising or were able to take a tremendous amount of impressions in the digital environment and started working on ties that. I think both are necessary. You have to work on the down top down with premium. We think that a scale relevant and ready to gate today. We want to have our foot in the bottom up and understand and nine about that. There are segments of the population will be better suited to that. Why we did it with honor media is straightforward. We believe there are certain things, the core of at t does well which is meet the needs of millions of customers on some scratch and Business Models and repeat things over and over again at scale. What we dont do as well is innovate and do small things that sometime the care and feeding and nurturing without putting too much bureaucracy or process on them. It allows us to do that outside of the mothership area it allows that creativity to take root. It allows us to try different Business Models and learn from it. But not do it in a way where it has to be governed by the larger business of at t. I think we have been pretty successful in finding a balance. Julia what is your business when you look like two or three years from now . The marketplace is changing so much and you have your hands in these different businesses in a way, experiencing experiencing with these different products. How do you see at integrating it into the rest of what at t is offering . We would like to find places in the Digital World where we see momentum and attraction. We also want to take opportunities of what we have in the premium world and bring it together was some of that new and emerging stuff and fuse them in a way that is better. I think or you will start to see us do is find the things we are getting traction on with jens he and gen x and the millennials down here and start to bring some premium with it and create new categories where the two are blended together, and use our scale with mobility distribution to try to turbocharge those. I think if we are successful and demonstrate we can do that, there is an opportunity to start pulling those folks who havent moved into Subscription Services into that subscription echo system if we really get that traction. That is what the grand experience experiment is. Julia it sounds like a new type of digital bundle targeting millennials. I dont know if any of us know precisely what that is going to be. The beauty of having Software Distribution platforms and the flexibility of using mobility for distribution allows you to try a lot of Different Things and then moved back from that. There are so many players in this space right now. What about at ts approach is unique . What we understand, customers are being real clear, they love using the products and services, but they dont like the overheads. It needs to be a much simpler, more transparent experience to get the complement of things that they want. Conductivity anywhere, whether they are at home or on the go. The entertainment they can take with them. Yet, what they believe is a good value out of that. One of the things we need to focus on is a great Customer Experience. One that is very transparent so that they know what they are buying. There arent hidden fees, no ups, downs, no extras, and they know the deal is. There is low overhead in getting that done. When you leg of these new softwarebased product, the beauty is they take a lot of overhead out of the provisioning process and the Customer Support process and they play right into that nice, frictionless mobile experience. That is one of the things we need to do well in play into that. Over time, as you have the opportunity to deal with a stack of technology, you can manage ad loads. You can invest in more exclusive and premium content, you can monetize a different ways. Both the subscription and with advertising and play on a different scale than you did before. That is what we have to do better. What are you seeing in terms of big picture trends in industry right now . This afternoon, i talked about i interviewed brian robert and they talked about the need to adapt to consumers. Offer different types of packages. Perhaps more flexible, smaller. What are you seeing . I agree with that. The consumer today, if you think it what theyre looking at, it is not that they are not engaging with the content, the product we are offering, they are just engaging in a different way. They want to do it on their terms instead of sitting down and watching it at an hour a time. They want to watch an entire season over the course of a friday and saturday night. A one latitude to do it in the house and outside the house. Some are looking for different price points. There is no question that the industry fit in self into the premiums side of the price point at the high end and we have left this gap of people who need a starter set to move in. I think of flexibility is a key issue in the way that you can come up with different Business Models and different distributional platforms that start to take costs out of how you deliver these products, that take costs out of the support lifecycle for customers, they are less less cpu intensive. They all play within the Customer Choice and possibility they need. Do you think the starter packages are a gateway drug for getting people to sign up for a full directv package, or you think there is a new generation of consumers who is never going to want to pay for a full cable bundle or satellite tv bundle . I dont the guy want to characterize it as a gateway drug, but we believe there is they need to have a set of training wheels. O have a starter set i believe there will be some never come into the echo system. Today, we have over 20 Million People who arent part of the echo system. Some and not because they dont want to be apart, they cant clear credit checks to get in overhead every cp centric models that require you to have inservice lifes of 14 months before you get payback. I think we will start to see some of this where different sized bundles and different sized offerings allow you to adjust parts of the market that havent brought into todays industrialstrength market. Theyre going to be some who say i do want to be a part of it. I want to be my own curator. I am ok with this fragmented environment. That is going to be ok. If you build the right kind of architecture and platforms, you can be adaptable and fax will. That will be ok because you will reach the different types of packages . To her types of packages or in our case, our goal is to provide connectivity and move tonnage. That is a mainstay of our business. If any connectivity to consume other content and move tonnage, then we can ultimately and back returns on investment of that infrastructure. Who is your biggest competitor for at T Entertainment . I wish i could narrow it down to one. We certainly have the traditional set. We look at what comcast has done with their business and admire what they have done. They have done a great job of building a set of entertainment assets and in distribution platform, but have to look at some of the nontraditional providers like netflix. Y do great things to clearly customers are voting and saying they like that. We have a variety of people coming at us from different angles. That is the beauty of it, it is an intensely competitive industry. Asis kind of a mystery to me to why somebody says there needs to be more accurate active involvement from a Regulatory Institution when there is so much action going on. The fccre criticizing for unlocking the top box proposal . Im just asking why we are needing any additional regulation whether it is on or unlocking the box. Regulatoryre environment. Just a final note. We will be hearing from the ceo of periscope. We have seen facebook make a big push for its Live Streaming video. What does that all mean for you . To have people streaming video on their mobile devices or is a competition . I think it is a great thing the fact that people want to continue to engage and use data and find ways to be more connected, connect more devices at the end of the day is always good for our business. From the dawn of time what we have made our money on is moving a bed around it that around. Our job is to continue to invest in our infrastructure and lower the cost of how people can lower those bids so they can have more applications and opportunities to use applications like periscope and feel good using them. E think that is a good thing our approach to that is just constantly invest to drive cost down. If you look at what is starting to happen now, we are starting to see the dawn of the upstream of consumption. Sended to be all push and and now we have more individual creation, more information being sent up to the cloud. That is great for a Network Business like ours. We do entertainment because it network, notn a necessarily because we think we are great at a net aT Entertainment. Do you think you will continue to see a rise in traffic . I think we will continue to see an increase in traffic and growths growth rates of upstream traffic are outpacing downstream traffic. I think we are just starting to see the front and of the innovation of the upstream dynamic. Unfortunately we are out of time but thank you for joining us. Ceo of at T Entertainment, really appreciate it. [applause] ceo of we have the mashable. Pete, you come from a very different type of business. You build a Digital Content business and about a year ago you started investing heavily in video. And a couple of months ago you announced a Big Partnership with turner. Tell us about this partnership with turner and what brings you here to a room of television and cable executives. Pete mashable is a startup and it is a decade old. The first wave was newspapers and magazines coming online. We were able to build one of the biggest new Media Companies with the biggest distribution and build the future of newspapers and magazines online. I think now it is quite clear there is another revolution happening, how are people going to consume video in the future . Smart Companies Like turner are looking at this and saying that we are aiming at ott. , we think there is some overthetop solution that will work as well. We have a Data Platform called mashable velocity which is about producing content more efficiently and targeting better. Really it is about marrying those trends together. Julia tell us a little bit about velocity. It has been something that is very effective in your Digital Content production throughout the ecosystem from the creation to the distribution. How does it work . Velocitycame up with as a patented algorithm years ago because our readers want to know what is new and next in media and across the web. We saw editors on social media trying to figure out what is going on. At the same time, our readers were saying they do not know just want to know what the most viral thing was, they want to know what is upcoming. Velocity is a predictive algorithm, a learning algorithm. It is looking at things like what a story on mashable will look like versus a competitor. Thehes the hold web whole web and says, this is what you should focus on because there is a lot of life left in the story, and this is what you should not focus on. Itself,create content we obviously use that in distribution as well. Once we put an article out there we can say this is going strong on facebook, lets upgrade it to the main page, or this is something we have to push harder on youtube. Brand content. Ke ideas liken put in what resonated among female millennials looking to buy a car. Ability to look for everything that has worked and we target those people again once you have made the series is powerful, and we found it to be a big advantage in video. Julia how do you expect to apply this to your partnership with turner . The advantages as we have online distribution, snapchat discover, youtube, facebook. We have 30 million plus followers online because we started at the start of the social revolution. We have the most influential followers and facebook fans, and there is a few parts working with the ecosystem of tv. Of the showsbution and another is developing shows together using the Data Platform. When you can have ideas coming our side,v side or analyze the data and targeted to an audience it makes it much safer. On turner, the other piece we are doing is branded content. We Just Announced our new brand in new york on friday and we are looking to bring our branded offerings to linear and the future. That will be a unique opportunity for advertisers in the future. Julia you clearly have been having a lot of conversations with television companies. What do you see about their needs and how they are evolving in this landscape . Pete i think it has been really interesting. It is a completely different world when you look at it. I have really been learning a lot about how when you produce for tv, there is a group of people who come together for a and we and Digital Media have always been about people learn from the data and interaction and raters. It is kind of just a different personnel function but the real needs are digital distribution and as always, and this is kind of surprising, how do you have a hit show, target the right people, and what is a hit show . With velocity we can target the right people with the right show so what was a niche that was not big enough for television is sustainable. Julia you are shifting toward not just digital video but traditional, oldfashioned television. Does that mean there is less opportunity in traditional Online Advertising than you initially thought . Pete we are aiming at online. When we talk about tv people start to think about the screen at my house and it must come through here. What we are really talk about is talking about is in some cases you will still have a bundle but it will come to your house in a different way. It is technically online, coming to you probably from your internet connection, and everyone is aiming at that. It is more datadriven and competitive so you need to fight for your audience. It is still online. The dollars are still technically online dollars if we go to fcc. It is a different way of getting your media. Julia what is the biggest challenge for you as you shift gears for mashable . Spent, as youwe said, kind of the last i think if you want to understand Digital Media there are two transitions. One is going from being a singular platform to being a multimedia Platform Company on multiple platforms. We have to tell stories across multiple platforms. Develop Something Like 35 hours a month with facebook live. Going from singular platform everything happens on mashable to multiplatform multi is something we have done. There is something we launched. Ast year last summer another thing that is changing that is very excited for us theting for us, fastestgrowing part of our business is branding content. To do we work with brands make theories and integrate their messaging, whether it is working with wells fargo on a series called mashable explains finance. We want millennials to be interested in finance and we wanted to be fun and entertaining, and still get across the message. Those of the two big changes in media across the years and we think in the mashable studios, we have nailed both of those which is why we focus all of our video resources under the mashable studios banner. Julia as you look back at the history of television there were sponsored game shows. Pete bringing it back. Julia are there going to be challenges to that . If theyre going to be resistance for madison avenue and viewers . I think disclosure is very important. What we have found in video is disclosure is a lot easier and you can get across much more information. Great contentis and disclosure is clear, i think viewers want great content. I like shows like comedians in cars getting coffee. I know that it is sponsored and viewers are aware that that is how their media is paid for, what i think if they disclosure is clear they are perfectly happy for that. Julia we were just talking with at T Entertainment. There are all these new bundles, amazon prime video, verizon go 90. Hulu is working on a live video bundle. What are the future of these bundles and where does mashable fit in . Dealswe did have some with go 90 and amazon prime video. Nobody really knows who will win in the bundle play but it is a great time to be a content creator because more and more people want content in their morees, and more and people are paying to get your content into the bundle and competing for great premium content. If you are creating something people want, you are very well positioned. I think there will be a few that consumers decide, this is the bundle i am going to go for, and people focus on those bundles. Right now there is a lot of opportunity and it is just which bundle do we want to be part of, and let them compete for our content. Julia it is a is it a bit of a content bubble right now . Pete no, i think it is really if huge opportunity you look at the size of this opportunity if this is the future of how you get your large thed how ecosystem is, it is up for grabs and well worth people trying to figure out if they can be a bundle provider. Mashable is not trying to provide a bundle for 10 a month. We would like to be a content provider, but i think ultimately that will figure itself out and it is great to be a content creator. Julia in terms of your own business, you can video is a lot more expensive than using print articles. How you manage the higher cost . Pete it is a highermargin. We had 69 growth in branded content over the past year. It is the fastestgrowing part of our business. We spent a couple years investing figuring out video, realizing it is more expensive to produce but there is higher margin on the brand itself. What is really difficult about the way mashable approaches it and the way that networks are coming to us, we use data a lot more. The great thing about being online is that for instance with our series camelot that we just featured, we had something show up in the mashable velocity dashboard. Covered the text article and it went viral. We said, we will make a pilot. A pilot is one video. We get all the data back, so is watching it and when . We say, this is big, it got 500,000 views and we did not market it, and we will make a second series. And then many millions of years when we look at that and say, how can we do this again and repeat the process with longerterm with data coming across the three years velocity, it is a more affordable way to make video and exactly the same as the previous era, we do not have this huge legacy business that is expensive to maintain. Can, with something, see if the data supports it and make it with a lot of speed. Julia do you find the data you get from your velocity algorithms is different than it is in print . We evolvedain thing his velocity was definitely designed for a quick turn. What we have done is evolved video so velocity can tell you andout 83. 3 accuracy it can give you a topical view and say your the topics you should be focused on. This particular story about trump is fading off. You can look at anything on the web and see how much life it has left in it. With videos we do longer terms. With video it is about looking at the historical database. Julia because it takes longer to make a video then write an article. Pete it is more than it takes longer if we are working together with the brand to figure out together, is this something you want to do . We do not necessarily call them up and five months later five minutes later when we do the video, get approval. Turnople wanted quick video, and we are doing that in text with a couple of brands this year where we take over their whole content strategy and do a really quick turn including text and video, so we are doing that and hope to do more. Thank you so much for joining us. Conversation,t please welcome Senior Editor of adia at recode, peter coffee and his guest nigel eccles. We did when of these in february. We did. You are a good person to talk to every couple months because your business keeps changing. This crowd probably first heard about you last summer, last fall. It looked like your entire industry and company would be shut down but you are still here. Why dont you give the update of where you are at legally . Fan tool is still operating but not everywhere in the u. S. . You touched on last october, the industry had a crisis point and previously, Fantasy Sports has operated 50 years and suddenly people are beginning to question the legality. What happened was in a number of states, the state attorney generals question the legality. Is this gambling are not . Our position is that Fantasy Sports are a game of skill. Games of skill are legal. Some people have different opinions on that and in a number of states, texas, hawaii, york, we stopped operating. Hand,as reading before they sickly a quarter of the country can no longer participate. 20 to 20 25 . And a year ago you did not anticipate that . No, we did not. The laws that apply to Fantasy Sports where fine when this was a small grassroots activity, but 50 Million People play it. It was not a big business. We knew as it started becoming very big business, it was not going to become a multibilliondollar unregulated industry so we knew we had to get from here to there. We did not think it would happen as quickly as this. In some states like texas we have exited those states, but what we have been doing is legislators saying, Fantasy Sports is enormously popular, we are very supportive of Consumer Protection regulations, so lets clarify the laws, and we have been very successful. Introduced inills almost 30 states in the last six months, really quite phenomenal. We have seen bills pass and become law. So you have to go statebystate and lobby each legislature . That is correct. Where peoplelevel are looking at this going, maybe the law is not as clear as you would like, but we also want to put in Consumer Protection. In virginia, the first state to pass the law, we clarified Fantasy Sports as a game of skill as legal in virginia, but we want you to register and make sure you are protecting players. You do it statebystate, and have to expend time and money. You did not anticipate you are going to spend your money ongoing state to state lobbying . No. Are there things you thought you were going to use that money for or expansions have had to put on hold . I would certainly say we definitely dialed back on marketing and increased in regulatory and legal. I would say the core investment of the product stands as much and greater than last year. We as a company view that we are transforming the way people consume sports and it is a multiyear effort. We have expanded the size of our product engineering teams over the last few because we want the product to keep Getting Better and deliver on that mission of transforming sports entertainment. And you are able to hire engineers and not worry that youre going to go out of business . Know, we have been very strong. Recently, we have been bringing people on as we are building on a platform. At the beginning of this conversation, when we were talking about where fan tool and draft kings were last fall, he spent hours of week on advertising you spent hours a week on advertising. Is that a good idea . Wedefinitely wanted to definitely made a mistake. We wanted to generate awareness and our Biggest Issue was that most people were not aware of it. We thought we knew what people liked about the product. We think that the level of advertising and we probably did not sell all the benefits of the product and we overexposed it. Over time we were getting there. There is two possible negative side effects of blanketing. One is turning people off of the product and number two, it seems like you raised your profile enough that people like the attorney general of new york said, im going to look into this company. Do you think that is part of the legal backlash . I think whatever we put it out there people were going to ask the question, so i think the issues we are going through were going to happen anyway, i just do not think they would happen as quickly. You have spent hundreds of millions collectively last fall on football related ads. Football is what drives your business . Largely, but basketball has been the lord fastestgrowing one. If you look over the past 15 years, one of the biggest drivers of the consumption of nfl is Fantasy Sports, and basketball has not seen that growth. The nfl is probably number one importance, but we have seen an increase in consumption of nba. Nearterm, this fall, as you make a push to recruit people, what is going to be different this year . Last year was about awareness. We had tons of awareness and that is not an issue. The issue is more about introducing new aspects of products. I think that is something we made a mistake on master wise, it became very serious. An emphasis on how much money you could make. Focus, but wee want to get back to fantasy because people say that is fun. Advertising really missed that. Not doing it as a vocation . We wanted to have fun as well. It is part of the sports experience. Advertising is not fun and it is bad for us. The tone of the ad will change. You want to be more fun . Yes. I was watching football last year and i had to see ads for both of you guys at every commercial break. Are you going to pour money into tv . Still very important. I do not think there is any medium as good as telling a story or building a brand but we have seen a shift of the last years of more and more digital, particularly social, the opportunity to target and track are so much stronger. I would say thirdly, the opportunity to cut and change or as we see our span in the future, i see it shift more to those channels away from tv. Does the overall spend increase . That will be down from last year. Are there people you feel you could reach . It seems like you have the one product you should be advertising on tv because you have got to watch the nfl on tv. It seems like if anything, you guys should be pushing tv. Butt is a core part of it, the great thing for us as we know exactly where our fans are. They are on Sports Television so we can target them very closely. There is still a shift away to Digital Mobile. Their pockets of Digital Mobile that you think are underutilized as a marketer . There are probably smaller ones like i would say on digital , facebook for us is very effective. It gives us great targeting ability. They are very innovative and looking at what we can do with facebook this year is much more impressive than what we could do last year. What are some examples . Intimate ways of targeting people. Like on payments, instead of a cpm their product has changed . Because they are shifting their product and it is becoming more advertiser friendly. Benefit thatlso a you are not going to have the same sort of public profile to rile up more attorney generals . I think as we shift our messaging more about it being fun and kind of introduce people to the part of the product we did not really talk much about that is much better for the brand. Part of your pitch is you work with investors and your competitor you work with individual teams. Have any of them peeled off over the last year . Not at all. The nba is an investor now. We have partnered with 16 teams and a number of nfl teams. They are a core part of our brand story. It is about sports. How better can we do it then partner with your Favorite Sports Team . Fanan pick a cleveland take them to a cavaliers game and put them in the front you. I understand why you would want to partner with them. Theyve been incredibly supportive. , particularly in the nba, this is such a driver of sports consumption, that they have been very supportive of what we have been going over the last six months. We were talking backstage about, assuming that you get to a point where you are no longer fighting battles, what you can do one set opens up for you one of the things you want to do is become more of a media many of thepitches, networks are investors. Nbc. Fox is invested in draft things. Draft kings. In my surprise them to learn that you want to become a media platform. Absolutely. We have several million engaged millennials. 1835 year old male sports fans. They are on the platform every day. So, for someone like bud light partnered with on a competition, that is an absolute demographically want. What we have done as we branded that competition bud light. We have the nba playoffs, we had tournaments every day. Them tos a way for reach their base, and it is also attractive to our base are they market you guys . It is more us marketing them . Are they paying you . You are generating advertising on your own . We think it over time that will become a significant revenue stream. Is anheuserbusch your first big one . For some time, we knew the level of engagement we were driving. We knew it was interesting to advertiser. Were really working out a way to package it for them. I assume most of the consumption is on your phone, on your app. 80 of our users are on the phone. Is it happening while the game is going on . Its interesting. There are really three parts to it. The first one is research. I want to research my lineup. The second one is constructing my team and the third is the live scoring experience. Historically a lot of the research has been on the web, the laptop. We are putting more of that in the app. In terms of pulling together a lineup, that is in the phone. More and more on the phone. Is nearly all on the phone. That is where people in the sports bar. It is much easier to check in my phone than a laptop. Are you able to say to the leaks, we can show a bump in engagement . Weve already done the analysis we can show an increase in consumption particularly in the nba. If we show people are going to watching for games a week to watching seven games a week whenever they became a fan player for nba. The interesting thing i think is we are trying to put it all in the app so the deal that i do for researching my team is at a app, drafting my team is in the app. The golden opportunity for us is the live scoring experience, watching the game in the app. Because already i am doing everything in my app. Why cant i go to the game and see how my players are doing . Watcha a clip. There is lebron scoring three points. I want to do that any app. You want me to be able to watch the game on my phone. Absolutely. Those rights are owned by the tv networks. Theres that challenge. We look at the leak. You look at how they are unbundling and they are going more overthetop. Are separate because for some of our audience they are not getting them through subscription. They are not getting them in a linear format, they just want clips. So think it is an added inceptive for this audience. You have two very similar companies. Xirius xm. That you would combine at some point. Are you receptive to that idea . Yes. Three months ago. No real update. We are very focused on our business really excited about are for gentiles our projectiles. Are the players loyal to one brand or app . The players seem to be loyal to one. It takes time to get to know both platforms. The more heavier players tend to play a crossborder. Across both. In addition to the legal bow you have come i think the other big issue would be marketing perceptionwise was series of stories. Look, you guys have position something that anyone can do. But it turns out almost all the winnings go to a handful of players they go to mit. Youll lose. How do you fight back against that perception . That is definitely a big challenge, narrative we need to take on. The first thing, it is a game of skill. This is a game of skill. The more you work at it the better you get. That being said, some tournaments are different than others. The 70 million, that is the hardest to get into and the hardest to win. At the same time we have new player leaks, beginner leagues. 5050s. Really, you will see of the season as we try to move people to those ones. As a new player, usury not be in the world series of poker you should not be in the world series of poker. That is something i think we were not clear enough. People went straight into the most challenging competition instead of spending time learning the product. But you can still have the computer jockeys . Those guys they could still be in the kiddie pool. On. No. Some of the regulations we are fitting in, we have to label the highly experienced players. We also have to carve off areas they cannot play. Only new players can play. You have to get that marketing out. This is a thing where you can put it in a dollar. You are playing with other people who just started the product. And you are playing. In a much more front environment the other one we want to push more is the social side, playing your friends. We have not developed that. You know how good they are. You probably think you are much better than them. Do you have games were it is me and my buddies . Coming this year . We are going to see that much more this year. We have not really pushed it before. Just advicedvice for a lot of folks not working at a startup but wish they could, a year ago, everyone started, seemed very excited, the unicorn. Now a lot of people are faltering. Youve faltered in a public way. What the biggest lesson you have taken from a rough yera . Year . Embrace uncertainty. I lived through this in 2000. We went through a lot of challenges. We became a very successful company. Startups are like, they dont grow in a linear fashion. You have to do what the bonds as they come. Like, we are as enthusiastic today about our longterm vision and how we are going together, but to get there, for we know it is not going to be easy. I do not think we ever thought that. You are not planning to lose 25 of your user base. Thats right. Throughout our journey, and we have been in 2008. We have moments early on where we were one week away from having to shut down because we could not raise money. Startups always have uncertainty. Like, the that is part of the thrill of being an entrepreneu. S if you do not have the stomach for uncertainty, dont do it. I appreciated. Thanks for coming out. Thank you. Thank you. [applause] creditally do give him because he has a business to run. I want to bring on kayvon fromr beykpour periscope. You did a great. Youre in the media business. Apparent. You did not start out there, right . This is your second company. Second start of. Weour first out of, started a company. We build mobile app applications for universities. I like we started out building things we wanted to use. At the time we were students, we wanted to build something we could use. This is no different with periscope. It just turned out that the first out of the graduated and no longer could be consumers of our own product. With periscope we get to use it every day. Rettyuve had a p interesting 18 months . You sold the company to twitter. Launched a year ago. D one of these conversations on stage year ago. Same chairs. Your ceo. A month later he left. So, you have been working for jack dorsey for the last year or so. How are things different with jack dorsey running the show . I think it is really special to work with someone who was the inventor of the product over a decade ago. As the inventor, you have a Spiritual Connection with a product that i think is rare. Joe and i certainly feel passionately about what we did with periscope. To be able to do what we do and work closely with jack and his context and his vision for what in worldwitters value is really special. Someone i have been mired someone i have admired. An interim last summer and came on fulltime last fall. He said, there are things i want you to do differently them before. Did he give you different marching orders . No. One of the great things about the biggest one of advocates for paris scope joining twitter. There was no moment where he said your mandate was he wanted twitter to buy you guys . Put a clock on. A few screens have gone dark. He didnt give you any different marching orders, keep doing what youre doing . His marching orders were continued to do what youre doing which was built out your product and let us know what we can do. Ago, you were Live Streaming and then there was a company that looked like competition. They went away. Now you have got facebook doing Live Streaming. Theyre real competition, they are paying celebrities to live stream, paying Media Companies, including fox media, to stream exclusively on facebook. Youtube is starting to look at this. What is it like to compete headtohead with facebook . I think the media likes to dramatic picture about competition. The reality is even when we enter this market we were never the first. We could name dozens of Live Streaming apps that came before us and many more that will come to the market. I think that is one of the things that drove us about periscope. We wanted to be best or different or something that was int first. Us focus on what we want to be which is a fantastic product people love to use. Its not thefirst time but it is facebook. But isnt is not the first time that companies have but it is not 00 b the first Time Companies have incentivized people peoplebook had 800,000 watching and exploding watermelon. They were going to have an interview with president obama. Didnt work. Theyre really pushing it at every opportunity. Mark zuckerberg thinks this is a very important to him. It is not just any other competitor. It is a competitor with 1. 6 billion people that are pushing you. Are you reacting to what they are doing . Ttered that would we have done is good enough that other people want to shamelessly jump into the space. Ense, other people investing in Live Streaming, especially Reputable Companies you think it is a reaction to you guys . What do you think . It could be a random coincidence. Either way, i dont think our reaction is to double down on what we are doing which is staying the course and building a product people want to use. I think other people, ultimately other people in the Live Streaming space is a good thing. When we first launched, people do not want to spend their time Live Streaming. A bunch of pessimistic views on whether this medium is interesting for people to use. So, i am excited that that conversation has evolved now a point where no one questions the legitimacy. Now there are other narratives like how can paris scope succeed versus such as such competitors, or any number of other narratives. You do not even want to mention facebook by name. I have a question about live boroadly. I love the internet and i love the internet for a bunch of reasons and i can do whatever i want to do when i want to do it. Demand notion has spread to get in car spirit i can watch game of thrones at 9 30. Why is live attractive to Internet Users who are used to being able to watch things when they want to watch but not when they are on . I think one of the things that is attractive about live is it works in the first place. Not in the consumption but on the creation standpoint. The fact that i can walk around the streets at the snap of my f ingers command an audience of hundreds of thousands of people. Something like superheroey about that that is novel. That is new. Standpoint,mption what makes it different, even though we are used to being able go, there is something about live in the way the periscope achieves that that brings value and purpose to the immediacy of the interaction which is as a veiwer i can affect the experience. When i watch a tv show live, the fact that it is live may matter to me spiritually but might be able to direct a comment. I cant ask wolf blitzer a question on cnn. But if im watching your broadcast, i can ask you a question. Two seconds later you can respond. There is Something Different about the feedback we that does not exist in other forms of live there is Something Different about that feedback loop. You said it is novel. How do you get people over the idea that this is a novelty and or how do people over the idea that that one less stream you saw wasnt good. Stick with it. People are going to get better at it. Are you encouraging people to professionalize . What may drive them to check this out. The actual interaction of the product is what will get them to stay. For broadcasters and viewers and we have to approach those challenges differently. What attracts a broadcaster to come back is very different than what attracts viewer. We focus on both of those tracks differently. In the context of broadcasters, we try and make the kind of tools in your toolbox as a broadcaster more interesting overtime. We launched over the last couple months ago pro integration and drone integration. You can be broadcasting from your phone and switching between your phones camera and your go pro and your drone. Creative lever that we get broadcasters. We have to continue evolving with what they can do with the medium to make this a utility they can use to interact with their audience. Does it make sense to have that functionality built into the hardware . You mean when you are using go pro . Sure. It is not an app. It is just a button. Yeah, i think there are pros and cons either way. Using the phone as the nexus has a lot of advantages. That makes a lot of sense in the context of go pro. You are strapping it onto your chest. You do not want to be touching the device. If you have an external camera you want to place and have that start broadcasting, you want to press a button. Does twitter need to be in the hardware business for this to work, or can you work it as a software thing . Bei dont think we need to in the hardware space. There may be advantages to having integrations or owning the whole stack there is a lot you can account was with software and software integration. And there is a lot you can do, was with building ati on top of that. One of the things that facebook is doing is saying we are going to broadcast live, but we do not have to make it live. You can guys take something you recorded and push it o ut. Really it is tv. Is that something you guys look to do . I think we want to get more types of live content. On our platform. So, what that means to us as it does not need to be captured from a mobile device, which is why you see is entering the space of go pro and drones. I think that also means a good come from a device that is not any of those. They can come from studio feeds cutting together and multiple camera angles. I think what is more important than the source is how we denote where it came from. We always said that periscope is a platform for truth and empathy. Right now on periscope when you see something and it says live, you know its being captured by someones device somewhere in the world. We show you the latitude and longitude. There is something powerful beyond that. When we enter a world where we phone andng non what we have to did note that worked where the viewer can make a decision i understand it is not being captured from a phone. At least the platform has served me that information. Celebrities will use periscope. Kevin hart. Are there people who have become celebrities on periscope who are native to that form, or just periscope stars . One of the Amazing Things as we observe how the platform has evolved. You have all these microcommunities of stars and stars is not the right term. The hairstyling community or the pottery community. And you have these potters who will spend hours on a attracting other folks into pottery who aspire to be potters. So, theyre many celebrities with other ecosystem. How do you make money if you are a mini celebrity . Right now, the platform is not making money but a lot of folks there is no monetization. There is no inherent monetization within the periscope real estate. There is a lot of things we get to experiment with as a result of being part of twitter. A civil example is we are starting to see some brand experiment with tweet with periscopes in them. Two readers use that during the super bowl. They promoted the tweet of the periscope on twitter. That during the super bowl. They have built up an audience on periscope. They can go to brand and sponsors. Either help bring their brand onto periscope by doing some sort of collaboration or some sort of activation im assuming at some point advertising comes the periscope. Is that logical . I think it is one of the ways we can monetize. We are interested in other ways as well. If we were to pursue advertising, what we would feel strongly about is not doing that traditional by buddys live, but before i get to watch them, i have to watch 15 seconds of preroll. It is one mechanism that we can use. That has worked pretty well for you too. And allow them to distribute the money to the creators and build up the ecosystem. It is not the worst thing in the world. No. Its a very effective way to monetize. Are there things you were not doing on paris go but year ago that you were able to do now technically on periscope . We are investing in infrastructure. That matters both in terms of the fundamental capabilities of how low the latency is and how fast the connection time is. We didnt necessarily own as much of that stacker year ago. Have rebuilt a lot of the infrastructure. How many people are working on periscope . 40 fullime employees. Small company. We have the benefit of collaborating with a lot of our friends at twitter. It is an unfair number to look at because we get to leverage parts, the relevant parts of twitter be it a video infrastructure folks or be it support or other Technical Resources that help us do what we do without having more fulltime people. At some point does periscope become a function of twitter . This week you said you are testing a go live button on twitter. We think there is a lot of value in having a separate app, having a separate brand. That does not mean you will not see over time more and more integration with twitter. Over the last three or four months we now have full consumer playback integration on ios android and web. If you stumble into twitter, you see are seeing live video place. Thego live button in twitter composed as well you will begin to see periscope invest in, if you have a all aboutpp that is seeing and creating live video, what does that look like. We think that deserves to be its own space. One thing is also different is there was a lot of discussion about you guys were going to enable piracy. There was the Manny Paquiao fight. Watch a baseball game to periscope. Has the conversation died down . I think the conversation started because it was probably the first time weve had a breakaway consumer li application. Vthere was a lot of hubbub about this idea of is periscope a boon to piracy in all this other stuff . Piracy and pornography are usually the things ngs people have asked us about ever since we started pitching investors. I think a couple things happen. Realize that her scope is not a very effective tool to use for piracy. If you want to get a bootleg copy of game of those there are 50 better ways to do that. Someone is going to try that. At the end of the day, i think we have done a good job very vocal, from a policy standpoint this is not something we want on our platform. And we now have a lot of procedures in place of the responsive. And i think over time the other thing that really helped this external perception is that a lot of these partners who were concerned about their content being redistributed on periscope, they became users of the product. You mentioned baseball. The dodgers and the mets are using periscope almost every game to streambed he practices to stream batting practices. Para scope is the place i go to to watch the dodgers on the mets 0 that has helped. Thats changed because it was ago cnbc was kicking people out of their studio because they were periscoping. I think it has changed quite a bit. Well come back in a year and see whats changed. Thanks very much. You can see more from the internet and Television Expo later today on the communicators. Fccl hear from four commissioners talking about competition in the cable industry, settop boxes and efforts to provide broadband in lower income homes. Todaythe communicators is 6 30 p. M. Eastern on cspan