How Legacy Media is Killing Itself

- Everybody, welcome to Next Up with me,

Mark Alperth. Thank you for being here.

“I'm the editor and chief of the live interactive video.”

Platform two way, the host here of guide to you. Next up, everything that's next up. Thanks for tuning in. Thank you'll be pleased that you did. A great show today with a super interesting guest,

Rich Hintonello, is the founder and former CEO of Complex, Executive Chairman of Uprachs, and founder and chairman of Fort Nash, all great media properties. And this is a guy who's got his fingertips feel

for what's successful in media today. What in new media works, what it's the best of old media, really looking forward to talking to Rich. All right, so a quick break in when we come back,

the great Rich Hintonello will be here to talk media.

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- All right, ladies and gentlemen, next up in joining me now, Rich Antonella, founder and former CEO of Complex, executive chairman, Uprox Hand, now the founder and chairman of Fort Nash. All great media properties from which there's a ton to learn.

This is a gentleman who has started media companies and succeeded, which in this day and age seems easy, but it ain't, and Rich is next up joins us now. Thank you for being here. - Thank you very much, sir.

- How did you get in the media business? Did you grow up as a son of a newspaper publisher? - How did you do it? - Hardly. My dad was a UPS guy, so I didn't quite have exposure

to professional. I got into media accidentally to be honest with you. I went to school thinking I was gonna go be a traitor

“because where I grew up, the only way out was to make money”

and the only thing that I had seen were traders and stock guys and so on and so forth. So I went to school and I had some professors who seemed to find some light in me and screaming at me not to be a finance guy, not to be an accountant

and to use my right-brain left-brain creativity and push me into marketing. Got a job at Sochi and Sochi, the largest advertising company in the world at the time. Worked for Proctor, it worked on Proctor and Gamble.

Got exposed to branding, media and understanding had a change hearts and minds, and I absolutely fell in love with it and instead of being the evaluator of that, I figured I'd rather be the builder. - Yeah, in my career, some of the smartest and best builders

of media organizations had been people who came from advertising. Talk a little bit more about. Sochi and Sochi really, again, some people will know that name, others sadly won't, 'cause they're culturally illiteracy.

Really one of the great, not just had institutions in the American history, one of the great institutions in American history, in terms of the level of creativity, the power, the international, national reach. What did you learn in the advertising business

“that taught you about building great media companies?”

- So it's really understanding where people place value, like an understanding brands, how much money they were spending, how they would make money by converting, but even more so, and especially like a brand like Proctor,

and I worked on their flagship tide. I was very lucky, being very young, but to understand how important still branding, positioning, and the packaging of the narrative of the brand was in addition to all of the numbers.

So you have the bottom of the funnel, which is the math,

where you're setting a tone of what this brand means to you,

“why it's important, and then why it should drive down”

the funnel to purchase. - And ladies, no, sorry, and just, I know, it sounds like very complicated and I'm over-simplifying it. To be honest, that's the beautiful part about advertising and marketing in general.

It's not as complicated as everybody likes to make it out to be. - Ladies and gentlemen, if you didn't listen closely or reaches last answer, I'd urge you to hit pause and go back, because that was more valuable than most business school degrees,

the notion of explaining, the connection between successful advertising, successful content creation. Brilliant, I'm tempted to stop now, but let's keep going, 'cause I know you'll build on it. - I'm not that smart, I just make no.

That was a good answer as I've heard. One of the things I see in all of your media properties, including the current one, four dash, is it seems to me, I'm pretty sure you'll say yes, but I won't get you to explain it.

You understand the power of two things in building a successful media property. One is you gotta have a DNA, that the audience not just loves, but they see it. They see it in every piece of content.

- Not seeing it, feels it. - Billion, it feels it. - Sense is it immediately. There's something about the DNA that you establish and it's something that the market wants

and it's something that's the through line for everything. And then the other thing is, and this is one of my criticisms of the ad business, sometimes, is character driven. You're properties understand,

people want to connect to humans more than two ideas. And what fuses it is, when you have the DNA of the ideas of the brand with recognizable personalities, whether they're your employees and your creators, or their celebrities.

You've nonetheless fused the DNA with the personalities, explain that. Assuming you agree.

- But so first of all, I not only couldn't agree more,

but I love the angle and the entry point, which you're coming at this. And let me really kind of peel back a couple of layers of the onions. - Yes, please.

- So there's time to disagree with about you said. There's a lot of detail and nuance within that that makes all the difference in the world, however. So the big problem that I have with most media properties is there actually reporters or journalists.

And don't get me wrong. Reporters and journalists are very important from a news perspective. But if you're building a real media brand to your go to your point about DNA,

“you have to be able to start a conversation,”

not just cover and participate in an already existing one. The difference between a brand that has the ability to define a marketplace and define and start the conversations and then continue to own them is where the magic happens in media brands.

And most people don't understand that. And what's ironic is that actually ties in very succinctly with your second point where if you have the right people that have the ability to understand the categories you're in, the past references, they have a very good,

strong viewpoint on where the world is going, you have the ability to start that. So it's all tied together, right? In being very deliberate about understanding going, why does someone care about this?

How are we uniquely different? And how do I continue to add value to them? Both from a short, mid and long-form basis consistently across the board because you can't dip in and out of media anymore.

Even large-scale players need an always-on basis, right?

I mean, look at the way the Marvel universe is marketing the new Marvel movies coming out. That like, even them, that is gonna open regardless. But this isn't two weeks of commercials beforehand. It's eight months of conversations of leaked footage,

discussions about the plot, all of these things.

“At the end of the day, you have to be able to be powerful”

and pull people in to have a very deep conversation, not just push media and messaging at them. - Right, let me set this up for folks and then we're gonna dive right back into where you just left off. If you're a media professional,

if you're in the business of creating content, sports, entertainment, news, whatever it is, this is a fascinating conversation, at least reaches part of it. If you're just a normal citizen, why do you care? This is the way we all get entertained informed.

News you can use, this is the stuff of our life now. And which brand survive and which don't will tell the tale of what you have access to. There may be great brands that you love from your childhood or from your young adulthood that don't long or exist.

And so you gotta understand, who will survive, who will thrive? Two brands, one time magazine where I worked,

And then your new company, Fort Nash, okay?

I went on the Fort Nash website after you were booked. I looked at the website for 25 seconds and I know everything about Fort Nash. I know who you're trying to appeal to. I know what the sensibility is.

I know the kinds of stories I'll get there. When I worked at time and they were trying to transition from the ultimate legacy brand, the weekly print magazine. That was the business. There was no website, there was no social media.

That was the business. When I got there, social was started, but really,

“not just on magazine, one of the most important global in the history of the world.”

The cover of Time magazine with Donald Trump is obsessed with. Everybody was obsessed with. It was news, who was on the cover every week. And then of course, the signature issues like personal of the year, et cetera, even a bigger deal.

When I was a time and they were trying to transition to a digital age and survive, I would go to these meetings and they would propose, "Well, let's do a cooking show or hire this person to host." And I would say, "What is the DNA of Time magazine?" We're not just going to win in the competitive digital world

by doing interesting things or things people in Manhattan. Think or interesting. We will win or lose if there is a throughline, a DNA. What is Time stand for? When it was a weekly magazine, we knew what it stood for.

Can you take whatever those principles were, whatever that DNA was, and transfer it to digital? And they could not. They could not. And today, I don't know the last time you went to Time.com,

probably not that much, I would guess. Unfortunately, I explain. Honestly, it would be years and years and years. Yeah. And if you're walking through O'Hare Airport,

and there's a time magazine on the new stand, you're not buying that. You're looking at that as a relic. So why is everybody talking about weight loss injections? It's because the results can be so dramatic.

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How did you conceive of the need in the market and then how did you execute it? So let me actually back up one second, because you brought up a very interesting point. And I have a phrase that I've been throwing out for 15 years.

It just continues to become more and more true every year.

Is we have never seen the last two generations,

especially millennials and gen Z's. We've never seen a generation that is more brand conscious, yet less brand loyal at the same time. Say it again, you got to say it again. It's an ultimate.

If you're trying to understand the future of media and the marketplace, please say it again. So we have never seen a generation that is more brand conscious yet less brand loyal at the same time. And what that means actually it just explains what you just said.

The legacy brands have never been more challenged and will never continue to be more challenged. The challenger brands have never had a better landscape and a context than a background to break through and be meaningful.

“Now the difference is you have to the audiences”

and that loyalty are just much more. The fandoms are much more bifurcated and fragmented and segmented. And you just have to embrace the fragmentation and segmentation. So is there ever going to be another time magazine?

The answer is no, by the way.

Like nothing could be this one big unifier of let's call it the intelligency, the intelligency of conversation around news, which is the way I used to think what time really was, right? That's the way I felt about it.

What about I know you're in the middle of a point but I'm going to stop you practically. What about word all? Does word all reach that love looking like that? Well, so a game and gamification can be unbelievably relevant?

Yeah. But is it owned by a brand really at the end of the day? Like I know it's part of the times, the New York Times, right? And it's a very important driver for them.

Like I know a lot of people can argue.

It's like the new version.

“It's like the Gen Z version of what the crossword used to mean to the New York Times, right?”

Right. But to me, like that's more of a service than it is. A binder sign, I was mostly kidding. But it is, it is a demonstration that people can create something new. That can produce, I didn't have a monopoly.

Everybody's trying to rip it off. But it's something distinctive. And I know you want to get, I want to get to the new stuff.

But when we had these, these three newsweeklies, three broadcast networks, and all this

market share, that was a product of the technological limits in the barriers to entry, to the only distribution. People clearly, though, there's a societal benefit to that. And there's an individual desire for that, right? That's why we see the NFL.

Live sports do well. People want to be part of something larger than themselves. It's a national experience. So even though the technology now created, it's hard to have the same market share, because I don't have the monopoly on distribution.

They're still a hunger for this, right? They're still a human desire. So you make very good points.

“But again, let's make a delineation between sports, news, and actual content development, right?”

There's those are different, right? Like sports is such an anomaly.

And the bottom line is, is live sports does more like live sports in music or the only two things

that can organize massive groups of people, right? That on an unbelievably captive basis versus everything else, where everyone is distracted, reading and looking at things. Then you have news, which comes in and out of relevance, and we could argue about factuality, and opinion within news these days, and the problem that that occurs.

But then we go to the most challenging part, content development, to make something that is not just interest point-based, but the publisher or the creator of that content needs to have an ability to build the entry point, and the raison d'etra for the audience to want to consume that content. Because now the discoverability is so different. You're not turning on channel 7 and being like, "Oh, I just watched lost,

and I'll watch whatever is on afterwards." Now it's like whether it's your phone, your computer, the 75 screens you have going on,

“you have to break through with that content.”

And for me, I need to not only see who it's talking about, but what is unique about that, that makes me want to actually click on it and consume it. Right, so let's go back to Fortnite and talk about how that fits into your theory. Bingo. So that's exactly where I was going on a segue basis. Is there or the irony is country music? It's very similar to complex in a lot of ways.

Like, complex started in 2002 when hip hop was disproportionately influencing youth culture, but not getting credit for it, right? It was looked at as this peripheral player. And what we did is shine a light on all of hip hop culture, whether it was sneakers, style, the music, the lyrics, the culture in general. Country music is gigantic in this country from an influence, perspective, and so is Southern lifestyle.

And there's a lot of new school Americana that is also having what I would call a resurgence. And my viewpoint is it's a huge category, but the media assets are completely not being invested in. You have a large-scale television channel against it, which is country music television, and they're nice, but there's not a lot of very dynamic programming that is super interesting. The format innovation is almost zero, and their audience is very small.

Then you have no middle, and then you have a long tail of let's call it PR-oriented social channels on TikTok and Instagram that are covering, oh, here's the new Morgan Wallen song, and it's completely undifferentiated. Our viewpoint is let's put country and Southern culture in the middle of this, and music is a component. But when we discuss music, we're talking about the references. We're going deeper. We're giving people the real story behind the artists,

the lyrics, and the depth, and we're spending money and investing. It's a very old school concept, but investing in real discussion and conversation creation versus just hopping on what's already occurring. And that's a big delineation. Like you said, you went to Fort Nash, and you felt the

of shining a light onto Southern culture and music, and getting these tremendously talented artists

to credit they actually deserve, not just some stream lessons on Spotify. So again, here's the DNA. The DNA is Southern culture and country music are cool and interesting and a great prism through which to appreciate life and to understand America. Do I have that? I don't know what you're hired. And I could tell that after two minutes on the site,

“that that's what it is because it is having a moment when you see Beyonce making a country album,”

when you see that post-malone, when you see the number of halftime shows and singers of the National Anthem, who are from country. And when you see the rise of the South now as again, in terms of food, in terms of personalities, in terms of style, in terms of architecture, it's right in the moment, and obviously the audience for it is vast. That's right. You can go there. There's no, but there's no media leader. And there is the performer. There is now. So you say, okay, so then, and again,

ladies and gentlemen, if you're not in the media business, this should still be of interest to you, because this is a great business story. But it's also a great story about what will survive. If you're interested in this topic, and you love Fort Nash, will it survive? Well, it's survivor not, depends on revenue. So how do you approach the great idea, knowing that the advertising

business is dead? You're never going to make a living selling ads. How does Fort Nash become a

business that backs a great idea for sustainability? So first of all, respectfully, the advertising business is hardly dead. I, well, traditional traditional transactional advertising bought on CPMs and other things like that. It is unbelievably overcome,

“out of ties than undifferentiated. I think at the end of the day, look, if you are an advertising”

and a marketing person, you've heard of a name, David Obelvie. David Obelvie, to me, defined advertising and marketing better than anybody. It is the ability to change the hearts and minds of a consumer. And by the way, not only has that never been more important for brands,

but it has never been more challenging for brands. So who better to go to for a brand to help change

the hearts and minds of the consumer than somebody who is defining the conversations of the content that they're consuming? So my viewpoint is, this is not about placing an ad adjacent to on a website or on a mobile platform or a branded buy sponsored buy. It's actually working with brands to develop co-owned the IP and develop IP that is long-term conversational with them. So when we're talking about building out a food show with the grill dads about redoing, you know, having country

artists talk about their grandma's favorite recipe and doing a new school biscuit recipe with honey jalapeno sauce, well, the opportunity to work with craft to develop that show and get back to what

“I believe is real integration in a very deep basis and also change the economics from a marketing”

and a vendor relationship to a partnership basis where we could share in the upside together. To me, that's the level of innovation to push forward and differentiate that needs to be had. So the same level of uniqueness that we have about our content on our editorial, we need to be as innovative if not more on the monetization side of our business. Yeah, let me talk to you about a central issue in the creation of new media properties that

continues to confound me as someone who's been in the video business my old career. All these new companies that start and have the same video experiences. They don't hire for video, except in a minor way. Every month the bills come in for the video and then the revenue from the video comes in and the bills are much higher and the video team says we can make you more money on video if you invest more in our operation. But until you do, we can't produce high quality enough

video with video distribution to make your money back and most places just struggle along. The New York Times has been trying to be good at video for over a quarter century now and they just announced the latest event of a series of announcements. We want to be dominant in the video business. They're legacy. They have lots of resources. Whether they're year the New York Times or Fort Nash, what is the key? What are the keys to being successful producers of original video

that consumers want? So what is the definition of what is quality has changed tremendously just then even the last 10 years. Quality video, even on YouTube when people were trying to go into video 10, 15 years ago and many of these platforms that it very unsuccessfully. But the reason they

the high end editing and other things like that and what they ignored which really is the value

“that you're giving to the consumers invest in the quality of the conversation. Now I hate to say this”

but like news and journalists don't make good video. Sorry. And I mean that like not specifically like I say with respect to you. Right exactly. So no, but here's my point is I don't look at you as a journalist. Number one, I look at you as a conversationalist, right? You're not trying to cover something in uncover facts and tell a defined narrative. That could be entertaining but that's also more like fixed content. You have the magic of video, especially like let's call it like

at the end of the day YouTube dominates. People don't understand how big YouTube is and how important it is because that is where video lives and dots. That's going to define what the you are going to be successful or not. Because if you can build a subscriber based on YouTube, you can be successful everywhere. Then you can go and sell and upstream things to Netflix and Amazon and everything else. But if you can't get it foundationally there on a free and open platform then you are then

“you're not making a difference to the end consumer. And I think that's where a lot of people went wrong.”

Also, this, this, I happen and I'm not trying to bash those video people that were telling you we need more money. But a lot of those people came from television backgrounds and their definition of quality is something that looks good, not something that makes a difference and starts a conversation. Honestly, I hate to say, look at what we're on right now from a zoom perspective. The quality of this conversation has nothing to do with the fact that it doesn't look as good

as what was on ABC 10 years ago. And you know, the consumer 100% agree, consumer does not give a shit either by the way. 100% agree. And COVID played a big role in accelerating that because people just want quality of quality of content. Also, filming on this little device is absolutely absurd and easy. And by the way, more than the bare minimum. That's the expectation. You have, you have 462 subscribers to your YouTube channel. 462,000.

Doesn't, sorry, 462. I've, I've, I've never said that. I use, I use, I use that as a short

and 462K subscribers. How old's the company? Nine months, ten months. That's super impressive. How'd you do that? So, number one, look, again, it goes back to, are you, can you create conversations and content? Like, there's a lot of people who can get a lot of views on TikTok and Instagram reels and even YouTube shorts. But if you can't get someone to click the subscribe button, they are short term fans of what they just watched. They are not brand loyalists. When people

choose to follow you, especially on YouTube, not just like, again, a follower on Instagram and TikTok or nowhere near is valuable. It's a subscriber on YouTube. And do you understand why? On that, like, most people don't understand. Like, I do, because it's my, oh, life now. Right. Go ahead. No, go ahead. For the audience, this is important. Like, TikTok and Instagram mitigate. Like,

if you have 15 million followers and you put up a piece of content, all 15 million of your followers,

do not get that content on TikTok and Instagram. Maybe three, four percent of those maybe, maybe on the high side. Yes. Every single person who is a subscriber to you on YouTube gets pushed your new content that you publish. So, the value of a subscriber on YouTube is probably 30 to 40 to 100 to one, a follower on Instagram or TikTok. Yeah. And again, just for the

“layperson here, if you want to be in business and you want to have a relationship with an authentic”

community, you're better off having 200,000 YouTube subscribers than a million Instagram followers. Not even close. Not even close. Not even close. And the value of your business from an enterprise basis is also off the charts. What someone would pay you for that, it would be is is incomparable,

because there's millions, pardon the pawn, millions of million follower people on TikTok and

Instagram. There are very few people who ever get the 500,000 subscribers on YouTube. Correct. But you're closing in. We are. But we are. I mean, but look at the end of the day, we've put out serialized franchise content that is 7 to 11 minutes long. How many people can tell those quality

completion rate of our videos. So, if you have a video that's 7 to 11 minutes long,

we have 87% of our lives. Denominal, watching Denominal. Denominal, Denominal. Ladies and gentlemen, I could spend the rest of the week with Rachel and I guarantee you, he and I will be talking, because we're going to trade some business tips, because I have some ideas for him, and I want ideas from him. Again, if you haven't checked out for a national, I recommend it to you. If even if you're not interested in country and southern life,

“you should be, because it's so important to Americans. But even if you're not, if you're interested”

in quality content and you're interested in understanding how how successful new media businesses are built from a man who's done it before and is doing it again, I recommend it to Fortnite, you can see him anywhere. But I recommend the website and the YouTube channel for starters. Rich, really grateful to you and look forward to talking more. And I'm, I'm, I'm, I'm envious of your, your clear vision. And I wish I, I wish early in my career I'd spent a couple

“years at an legendary ad agency, so I'm sure it'd be better now than I am. Thank you so very much, sir,”

and you're doing really well yourself. Really appreciate. Ladies and gentlemen, again, go check out Fortnite. All right, next up. More next up is next up right after this. Let's talk about life insurance. We all know we need it, but many keep putting it off because it feels complicated, expensive and like something that can wait. Well, stop waiting. Take care of it today with select quote. In just 15 minutes, high quality coverage can be secure to fit any life and any budget.

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