No Mercy No Malice
Roblox Is Betting Big on the Kid Attention Economy
America’s kids are tuning into the gaming platform over 2.5 hours per day
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This is the second in a series of posts about one of the most accretive paradigm shifts in our economy since globalization and digitization: dispersion.
The market added half a trillion in value in the past two weeks: AT&T busted a baller move to a rundle, the FTC filed suit against Facebook, and an overhyped DoorDash and underhyped Airbnb went public.
AT&T’s announcement that it will release movies simultaneously on HBO Max and in theaters predictably pissed off Hollywood players, who make millions from the current system. But Christopher Nolan calling HBO Max “the worst streaming service” is similar to JCPenney calling Amazon circa 1999 a terrible experience. Doctors, talent agents, and film directors should host a pity party at Jeffrey Katzenberg’s crib, catered by Planet Hollywood and with performances from Robin Thicke and Billy Squier. (Note: You know the moment when the edible kicks in? It happened in the middle of the last sentence.)
Anyway.
AT&T CEO John Stankey realized the market favors recurring revenues and narrative over transactional revenues and EBITDA. Last week, the narrative was AT&T had been on the wrong side of a trade with the smartest man in media (Jeff Bewkes) and overpaid for Time Warner. Ironic that two of the five worst acquisitions in history have the same two words: Time Warner — which 18 years previous merged with AOL. An infirmed stock price is a terrible thing to waste, and AT&T’s underperformance inoculated it against the innovator’s dilemma. (Ma Bell has less to lose.) So it went gangster on theaters, opting for the consumer. AT&T is poised to recognize an increase of $100 billion or more in market cap in 2021 on its transition from a conglomerate that makes no sense to the world’s largest recurring-revenue firm.
Next up, the FTC and 48 states filed an antitrust lawsuit against Facebook. This formed the second of two dots, the first being the DOJ’s case against Google. Two dots make a line, and that line points toward the end of Big Tech as we know it. But while it’s tempting to think of these breakups…
