Smash Notes
Larry Ellison’s Media Ambitions & Kevin Roose on AI’s Biggest Gamble
Larry Ellison bought his son a media empire. What does he want from it? Vanity Fair’s Tom Dotan joins me to talk about the billionaire behind Paramount and Warner Bros., his connection to TikTok, and his politics. Tom’s reporting suggests there may be less of a master plan than you’d think. We also discuss why even Ellison’s enormous fortune has limits—and…
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Notes
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Peter Kafka opens the episode by calling Larry Ellison an 82-year-old billionaire and one of the 10 richest men in the world. Larry Ellison bought his son, David Ellison, a media empire. The companies were once called Paramount and Warner Brothers. Peter Kafka says they are now called Skydance.
Peter Kafka also calls Larry Ellison the eighth richest man in the world, tight with Donald Trump and Elon Musk, and connected to both TikTok and a traditional media conglomerate. He says the public does not know that much about Larry Ellison.
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A grand plan would be easier to understand. People like the Murdochs buy with the intent to control vast media empires, and Elon Musk bought Twitter in part to use it politically. Larry is close to Elon, and Oracle holds a 15% stake in TikTok, so the purchases can look like one project. The reporting found interests and politics, and the guest says he does not see a project spanning administrations or generations.
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David Ellison wanted to combine traditional media companies and scale them to compete with Netflix, Amazon, or YouTube. David Ellison had the money to try because of his father. Redbird is involved and the deal uses a huge amount of debt, but the money is Larry's.
The piece suggests Larry Ellison did not spend much time raising his first two children and tried to make up for it by bankrolling them in Hollywood. Annapurna Studios made well-respected movies and was a financial disaster. Larry Ellison is now doing the same bankrolling for David Ellison. Larry Ellison is not a media person, and Larry Ellison has conflicted feelings about how involved he was with his children.
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The first speaker says Oracle sells technology to other technology companies, which is a way for Oracle to be involved with TikTok. The guest then says Oracle's cloud computing business hosts TikTok's algorithm and is responsible for the security of the algorithm, and calls that a good business to have a piece of. When TikTok in the US came up during the first Trump administration, Microsoft wanted a piece of TikTok. For a time, Walmart and Oracle were going to own TikTok together. The guest says there are legitimate business reasons to want a piece of TikTok.
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Oracle owns 15% of TikTok. The stake is no larger than the stake held by Silverlake or by Andreessen Horowitz. ByteDance keeps a huge stake. Oracle is extremely defensive about any suggestion that Oracle influences the algorithm. The guest says it would be pretty difficult to move the algorithm so that it directly surfaces pro-Israel content.
Larry is close to Netanyahu. The day after the deal was signed, Netanyahu told influencers that social media is the number one tool and that TikTok is the most important thing to pay attention to. Larry is close to people who believe TikTok is a valuable weapon in propaganda wars Israel is focused on.
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Oracle's value shot up last fall during an AI boomlet and made Larry Ellison briefly the richest man in the world. The fortune has been cut in half, so he is now eighth. Larry Ellison still put tens of billions of dollars into the Paramount and Warner Brothers deal, now called Skydance.
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Ten years ago, when the book starts, there was no such thing as real AI. In 2016 the leading chatbots were very bad, and the voice assistants of that time did almost nothing valuable. Systems now solve century-old problems in math and science, build entire software programs, and pass graduate-level courses. The people who believed in AGI, a system that can do everything the human mind can, were fringe weirdos in San Francisco. Peers in academia and industry had mostly ostracized them. The progress was not a surprise to the people building the technology.
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The new podcast with NPR is called Machine Gods. It begins the week of October 19th and will cover the week's news plus interviews with people in the industry. NPR reaches people who would not choose a tech podcast.
Hard Fork was owned by the New York Times. The people who built Hard Fork wanted to build something for themselves. They have started a company, made hires, and are going to spin up a little media company.
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Kevin usually puts the probability that it all goes super bad at about ten percent. In most of the world that sounds crazy. In the city he is describing, the same ten percent makes him an optimist, because he knows people at fifty, sixty, and seventy percent, and someone at ninety-nine point nine percent. He says people still have agency, are not in the recursive self-improvement loop yet, and still could slow things down, pass some regulations, and coordinate to pace the frontier.