Acquired
03:30:25 · David Rosenthal, Ben Gilbert
[03:30:25] S1: Yeah. I think we should talk about it [03:30:27] S0: from the cap table's perspective. And it's what lets Seinfeld the asset of the show, even when it was being produced and today, be more valuable than anything that competes with it? Other shows? [03:30:41] S1: Yep. Yep. Okay. I think counter positioning today might be the biggest one, because it's the last of these huge retention tools left that is not captively owned by a streamer. So it can come to market in a way that Friends in the Office can't. [03:30:57] S0: And you think that's counter positioning? [03:31:00] S1: Well, if you were to say Friends in the Office are its competitors, they are structurally hamstrung Right. By their ownership situations now. [03:31:09] S0: If they did compete with Seinfeld to go to the free market and be able to go anywhere, it would hamstring their their parent company. [03:31:15] S1: Their parent companies would be making value destructive decisions to do that? [03:31:19] S0: Yep. At least based on their chosen current strategy of needing to have owned and operated streaming services. Yep. Scale economies all all over the place. I mean, the fact that the world has an installed base of a 100,000,000 plus Seinfeld fans. [03:31:35] S1: Oh, I agree, but I I would say this is network economies, not scale economies. [03:31:39] S0: Oh, that we're all [03:31:40] S1: The fact that you know all the memes from Seinfeld is extremely valuable to me.
03:31:40 · David Rosenthal, Ben Gilbert
[03:31:40] S1: The fact that you know all the memes from Seinfeld is extremely valuable to me. [03:31:45] S0: You're right. I don't think there's scale economies, because the definition of scale economy is when I can do something that is more profitable to me for the same input than one of my competitors can do because I have more scale. But this asset doesn't actually make any decisions or or or do anything. [03:32:07] S1: Yeah. I mean, like, the only activity [03:32:08] S0: is economies. When Netflix decides to pay $500,000,000, it can make better use of the Seinfeld content and be more profitable on that acquisition than smaller streaming services. Yep. But... Yeah. Branding? [03:32:22] S1: Maybe? Depends what you consider branding. [03:32:26] S0: Right. Is the whole tenor of the show branding? Is it just the logo? Is the... Like, I'd much rather watch Seinfeld than Big Bang Theory, but that's not because it's called Seinfeld, and I trust Seinfeld more. It's because I think the intrinsic quality of the show is higher. [03:32:38] S1: Yep. Yep. I don't think there's any switching costs here. No. Can't even think of what that would be in this case. Cornered resource, obviously, they have the rights to Seinfeld. [03:32:50] S0: And may... Maybe that is the power. That might... It might just all be cornered resource. [03:32:53] S1: Cornered resource. [03:32:54] S0: We have a thing that we can sell that other people can't sell and make a lot of money on it. [03:32:57] S1: Yep. And then the last one, process power.
03:32:57 · David Rosenthal, Ben Gilbert
[03:32:57] S1: Yep. And then the last one, process power. [03:33:00] S0: Not today, but there was... If you change this exercise to what did Seinfeld have when it was being produced that other shows didn't have. It's absolutely process power in the way they were making it. It's absolutely cornered resource in Jerry and Larry and some of the other writers that they had too. I think [03:33:20] S1: there was process power clearly just to the act of making the show. I don't think Jerry or Larry individually, or if they were to come together again now, could repeat it. It was a magic moment. And and in fact, the evidence is right there in in Curb. Right? Like, Larry had to run Curb differently than Seinfeld. He he couldn't do again what he did at Seinfeld. Curb was improv. Larry couldn't create the the scripts and and all of the intense effort and alchemy and magic that went into every week of Seinfeld in the same way. You just couldn't do it. [03:34:00] S0: Alright. Should we bring this baby home and do quintessence? [03:34:03] S1: Let's do it. I know where you're headed.
03:34:03 · David Rosenthal, Ben Gilbert
[03:34:03] S1: Let's do it. I know where you're headed. [03:34:05] S0: So, listeners, the way that we decided that we wanna do our quintessence this time is to answer the question, what made Seinfeld such a ludicrously good TV asset to own? Yep. What made it durable? What made it continue to get renewed for these really high rates three decades later? And, yes, there are comps in The Office, which actually is my preferred thing to watch all... Like, nightly. I grew up when it was on, and so it's, like, more for me. And it feels more modern and blah blah blah. Friends is arguably more valuable, but is held captive. So Seinfeld is like the one free agent in the top tier that actually can go and trade on the free market. [03:34:46] S1: Yep. And look, of course, there's a whole list of these, most of which we talked about earlier in analysis. But I think if you were to ask Jerry, at least, they went out on top. [03:34:58] S0: I think the driver is viewership begets viewership. So Seinfeld has been everywhere for the last three decades on a bunch of channels and streaming service. And because it has been omnipresent, there's so much demand today to watch it because we're so familiar. It is today's comfort food even though when it launched, it was very uncomfortable. [03:35:26] S1: Mhmm. [03:35:27] S0: I mean, during my childhood, teenage years, college, adulthood, it was everywhere, and I have all the jokes memorized. [03:35:32] S1: Mhmm. Always on every channel every night. Yep.
03:35:32 · David Rosenthal, Ben Gilbert
[03:35:32] S1: Mhmm. Always on every channel every night. Yep. [03:35:35] S0: It's passed from generation to generation that way. I talked to my dad about it. In fact, we were prepping for this episode, and my three year old son is sitting on the couch with me because we had the DVD on. We're watching... He loves putting the DVDs and the DVD player. And he goes... He points to the screen. He goes, is that Jerry Seinfeld? I was like, oh my god. [03:35:52] S1: That is awesome. [03:35:53] S0: Passed it to another generation. And then we're watching the DVD, like, interviews afterwards, and he points the screen. He goes, there. There's Larry David. And I was like, I am so proud of you right now. [03:36:04] S1: Wow. Good for him. [03:36:06] S0: I know. Right? But it's this thing. My parents liked it. I liked it. I like it. It's it's so in the water in our society. There's a crazy stat from Nielsen in 2021. 41% of Seinfeld's then current audience had either been toddlers or not born yet when the series ended in 1998. [03:36:27] S1: Amazing. [03:36:28] S0: So you kinda have to just keep tracing it back. Like, I I think you might be right that it's because it went out on top, but the reason, in my opinion, is because the 1995 and the 1998 syndication cycles were so successful and exploded out of the gate that it created this in the waterness to Seinfeld.
03:36:28 · Ben Gilbert, David Rosenthal
[03:36:28] S0: So you kinda have to just keep tracing it back. Like, I I think you might be right that it's because it went out on top, but the reason, in my opinion, is because the 1995 and the 1998 syndication cycles were so successful and exploded out of the gate that it created this in the waterness to Seinfeld. [03:36:54] S1: Yep. I I think... I mean, look, at the end of the day, it's a stew of all of these things. But I don't know. I just think if they'd milked it for a few more years and quality had gone downhill, this thing is so hypersensitive to the aggregate cultural assessment and impression of it that if at the end, it didn't have that, like, greatest show of all time vibe in the culture Yeah. The engine wouldn't have continued like this. [03:37:26] S0: Yeah. Totally agree. We're... And we're saying very similar things here. It's it's ultimately that coupled with quality. Like, the the situational jokes that they set up just don't feel dated. Even though a lot of these things could be solved with a cell phone, but the intrinsic quality of the situations they are in Yep. Still feels relevant today. [03:37:48] S1: Well, more than 20% of America agrees with you. [03:37:51] S0: 22%. [03:37:52] S1: There you go. [03:37:54] S0: Alright. [03:37:55] S1: Well, on this one, we've got some fun trivia that we should include here that didn't make the episode. Number one, the theme music. [03:38:05] S0: Yes. That was mine. The bass line. I wish I had, like, beep [03:38:14] S1: beep beep beep beep beep. Then tell everybody why the theme music is so distinctive.