Today, we’re publishing the first episode of Decoder with Nilay Patel, a new weekly podcast where I’ll be interviewing executives, policymakers, academics, and some other assorted troublemakers about what it takes to build the businesses of the future. After over a decade covering tech, it’s become very clear to me that every business is a tech business — and tech businesses have some very familiar problems, while creating very new kinds of opportunities.
To kick off the show, I couldn’t think of anyone better than Dallas Mavericks owner and tech investor Mark Cuban. Mark and I have known each other for a little while, and one of the reasons I was excited to have him as my first guest is because we disagree on some things — and we enjoy disagreeing with each other. One of my goals with this show is to have my own beliefs challenged, and Mark is pretty good at challenging your beliefs.
We recorded this conversation just after it had become clear that Joe Biden would win the presidential election, and we talked about what it’s going to take to build a new future. Pay close attention to how interwoven business, technology, and policy are in this conversation. It didn’t matter if we were talking about 5G, the NBA bubble, AI, or Mark’s investments into health care — if you want to understand the landscape of the future, you have to understand tech, you have to understand business, and you have to understand policy. That’s what I hope Decoder helps people do.
There’s also a pretty good story about meeting Donald Trump.
The following transcript has been lightly edited for clarity.
You’ve been obviously very vocal about the Trump presidency and what he has stood for. How are you feeling about a potential Biden presidency?
It depends on what happens with the Senate. Right? A big part of me thinks it will be better to have a Republican Senate, believe it or not, because I think the retribution that would come from Schumer to be Mitch McConnell’s twin would be a negative for the country.
I saw a couple of notes from banks. I’ve seen the markets today. I saw one note from a bank that was saying a Republican Senate would be great for business. We would have regulatory stagnation.
We’ve lost our form of government. We don’t pick the best candidates. I don’t think anybody’s here to say that Joe Biden and Donald Trump were the best and brightest that this country has to offer, or even out of the primaries from either party. We are now seeing the downside of having a political duopoly. And when a party gets power, they put power first and they get in their head that they’re able to take control and use that power. And that’s a problem for the country.
One of the things in the Trump era that I always thought was like the elephant in the room, is that Donald Trump was not an effective bureaucrat. He didn’t know how his own machine worked.
And so it was just chaos all the time. I would go on CNBC once a week, and they’d be like, “Trump said he’s going to ban TikTok.” And I’d be like, “No, he’s not. He doesn’t know what he’s talking about.”
He doesn’t. He never does, but it doesn’t matter.
But you don’t think that, I mean, on one timeline, Joe Biden is a creature of the government. He might be more effective at doing stuff. On the other timeline, you might get someone really Trump-y who knows what to do.
So, to your point, right? So, if the Republicans get the Senate, then Joe Biden has to be Joe Biden, and has to bring things together. And that’s a positive, right? But think about what happens when one party has both sides. It doesn’t matter what Joe Biden and Kamala Harris think, right? It wasn’t like Mitch McConnell was taking guidance from Donald Trump on any legislative issue, on any policy whatsoever. And it’s not like Nancy Pelosi was talking to Joe Biden and saying, “What do you think?” Or Chuck Schumer was saying, “What do you think? I really want to know what Joe Biden has to say,” before anything came out. Look at stimulus. We need stimulus. This economy needs stimulus. People are dying. People are starving. And they’re arguing about money for charities in Washington, DC. It’s just ridiculous, the things that they’re arguing about.
Listen to Decoder, a show hosted by The Verge’s Nilay Patel about big ideas — and other problems. Subscribe here!
There’s a pandemic. The NBA came through the bubble very successfully. The NFL seems to be a little less successful at it. There is stimulus that’s needed in the economy. Then there’s a massive set of accelerating trends, things people saw coming for a long time that are just real now. And then, there’s actual real change that would have never happened on any timeline — the one I always think of is 2.2 million women have left the workplace over the past year.
Of all of that, let’s start with the NBA, because obviously, you own the Mavs. You got through it. There was a lot of social activism with the NBA. The bubble was just a remarkable success, that it happened and you were able to pull it off.
There’s always been a blending of entertainment and sports, of culture and sports. Now, there’s a real blend of politics. There’s a lot of criticism that the league got more political, that your ratings are down. Do you think that swings back into balance, or is that here to stay?
Two things. One, sports and politics have always mixed. Jesse Owens, Muhammad Ali. I mean, my God, when he became Muhammad Ali, he wasn’t allowed to fight for two years, because he wouldn’t go to Vietnam, because the Viet Cong had done nothing to him, as he said, right? The 1980 Olympics, John Carlos, holding their arms up in protest. And going forward, it’s always happened. So, it’s not like sports and culture and politics weren’t intertwined. It’s not like Richard Nixon didn’t want to call a play for the Washington Redskins.
Yeah, but you’re talking about stars, right? In the finals, every NBA player had a social message on the back of their jersey. That’s different. I don’t think the median athlete in any pro league felt comfortable before —
In 1980, athletes did not go to the Olympics.
But I get your point, right? But part two to that is, Joe Biden won the election. And I think there’s a real feeling of accomplishment that, who knows how big an influence or how small an influence, but there was influence. And I think that is going to be rewarding to a lot of people within the NBA.
So you think it’s here to stay?
Yeah. I think it depends on the circumstances, right? When you have a broken political system, with candidates that people are either not in love with or hate, you’re going to get activism. If you have problems, and again, let me take one step back. Activism to end racism is not being political.
That’s an American ideal. If you’re not trying to support the end of racism or do things to end racism, that’s un-American. It’s not about being an activist, that should be part of our daily lives. If we see it, say something, or do something, or be anything but. And so, I do think that we will see when there’s challenges, there’ll be increased confidence to try to have an impact.
So, as you think about the NBA coming out of this, obviously there’s some discussion on when the season will start again, there’s some discussion about how to, obviously, reset that business. What do you think that you’ve learned from the bubble and operating in the pandemic, that will persist into the next version of the NBA?
When we shot season 12 of Shark Tank, Friday nights on ABC —
Good plug, Mark.
Yeah, you know that. But we did it, we shot in the bubble in the Venetian in Vegas. And one of the things that was underlined at all, was there are hundreds of people who work on the set and work on the production, whose livelihoods depended on this.
And the same thing applied with the NBA. We realized, the players realized what was at stake and how important it was to so many people. And that made it important to them. And that encouraged them to follow the rules. Not that they wouldn’t otherwise, but it really made everybody very specific in everything that they did, and very considerate.
So, I think what we learned from that was, you give people a reason to do the right thing, they will. Right? If you communicate honestly with people to do the right thing, they will. When you let people know what’s at stake, they’ll do the right thing, but it takes leadership and it takes communication. We had leadership with Adam Silver. We had leadership with the National Basketball Players Association, the NBPA. And you had leadership, LeBron James, Chris Paul, Dwight Powell, et cetera, Kyle Lowry, Andre Iguodala, people who stepped up and communicated to their membership. And you need that leadership in order to get the results that we got.
Why do you think it’s going less well with the NFL? I mean, I’m a Packers fan. They were just out of running backs, yesterday.
Yeah. I mean, two reasons. One, there’s just a lot more people.
We had a 17-person roster, 37 people in a traveling party. There’s 53 people on an NFL roster, plus the traveling party. And they’re traveling. We weren’t. So the challenges are just going to be unreal. They sleep in their own beds at night. We didn’t. Just getting that all executed on is very, very difficult, and they deserve credit for it having gone as well as it has.
Do you think when you come back to the NBA regular season, you’ll be able to pull it off once you have to travel?
Yeah, we’re going to try. I think so. Again, but it’s easier for us because we have fewer people that we have to deal with.
Coming out of that, I talked about things we saw accelerating. Work-from-home is one of those things. Ecommerce is one of those things. What are the trends that you’re surprised by?
I mean, from the technology perspective, none really, but from a libertarian perspective, that it’s been as dramatic as it has been. The “I refuse to wear a mask” group, that surprised me more than anything. I thought people would not politicize it nearly as much, that it was an opportunity for us to come together. You saw some of that at the beginning and, yeah, we can blame it on Donald Trump, but still. It’s just, people just not wearing masks at the expense of their own families to try to prove a point. I just didn’t see that coming.
I know you’re very critical of Facebook and the other social networks. Do you think that they’re responding to that appropriately now? They obviously amplified a lot of that message.
Yeah, particularly Facebook. Facebook’s a disaster.
But I mean, during this interminable election week, we’ve seen the major social networks, to varying degrees, get more aggressive. Do you think that’s going to hold?
Right, the problem, they’re trying to, again, deal with symptoms, not the problem that they created. It’s almost like, TikTok creates dance and music virility. Facebook lives for political virility, and that’s a problem. And you can argue that Mark Zuckerberg doesn’t have that responsibility, that you want to know who the idiots are and they’re front and center, right? But on balance when you look at what’s best for the American people, it’s been horrific. It’s been a disaster.
We talked about, maybe Congress will do things in a Biden administration, maybe we won’t get legislation. Up until now, there has been sort of bipartisan criticism of Facebook, all the way to, “We should break it up.” Do you think that that kind of remedy actually solves the problem? Or is this a leadership problem—
Breaking it up doesn’t solve it because it’s all about — algorithmic amplification is the problem, right? So effectively, with Facebook, you’re putting someone in a room and putting speakers all around the room and reeducating them. It’s like Facebook camp, where whatever bubble you’re in, that bubble is being thrown at you continuously in a reeducation process that you may or may not have asked for. Now you may choose to stay there because you always do have the right to leave, and that was always my perspective originally. You don’t have to be on Facebook, right? You’re not getting something you’re not asking for. But they become reeducation camps, and that’s a problem.
No, I hear from a lot of people who say, “We actually can’t leave Facebook.” Right? I mean, I think with Twitter, Twitter’s small. 22 percent of the American public interacts with Twitter. And then by the numbers, it’s actually only 1 in 10 Americans —
Right, and 8 percent of the people create 92 percent of the tweets.
I just feel like the answer for Twitter is like, “yeah, we’re censoring everybody. We’re putting labels all over everything. Quit if you don’t like it.”
Because people come onto Twitter to yell, right? Most of them have crazy profile pictures and don’t use their real name, and so you don’t have to take them seriously. On Facebook they’re your friends or your family, they’re people you know 90 percent of the time, and so that just has a different impact on you. When my kids’ parents [are] going on there saying the election’s being stolen, or Joe Biden has dementia, or the Democrats are leading to communism and we’ll be Venezuela within four years, and then three of their friends come in and say, “You’re right. You’re right. You’re right,” that’s a different conversation than PatriotAct462 ... that’s been on since July of 2020 saying, “Cuban, you’re a communist.”
Sometimes I think I have bad mentions, but before I came on, I went and looked at your Twitter feed. I’m like, “Oh, this is a different scale of a problem.” But Facebook is really... It’s wound itself into people’s lives. Your friends are there. They have multiple interlocking products that you might be interested in.
Seems a lot older, right? ... And those people are more susceptible. It’s like Fox News does its damage, and Facebook does even worse damage because it gets reinforced by people you actually know that are in your physical, your life bubble, in addition to just being on some wide social media net that you really don’t know the people and they’re abstract. Facebook’s not abstract, and that’s the huge difference.
What I’m getting to, here, is solving that problem. You don’t think breaking them up and making them compete would work?
No. If there’s Facebook one and Facebook two —
They’re both going to be the same, you think?
They’re the same thing, right? And it doesn’t make it any easier to control them because they’re a smaller company. As a matter of fact, you might ignore them more and it gets worse.
So the other option, which I think of as sort of the Josh Hawley option, is we’ll make Facebook a regulated monopoly.
And do what?
You’ll carve away Section 230, the law that says platforms aren’t liable for what users publish, you’ll do algorithmic transparency, you’ll make them audit every content moderation decision they make.
Yeah, that’s tough, right? But I do agree with what Roger McNamee said, and I’d take it even further. He said, dismiss 230 for anything that is negative algorithmic amplification. I think you get rid of 230 for any content that is seeing any algorithmic amplification. Once you’re amplifying it, you’re making editorial decisions, right? It doesn’t matter if it’s automated, right? Because someone had to build the automation and incorporate and build those weights and balances. And so once you start amplifying it, regardless of how you got there, now you’re a publisher. You’re making choices on what content to present to people. You’re making choices that — this person leans right, and so I’m going to keep on giving him more, and his friends lean right, so they’re all in this bubble and this particular type of content. Again, it’s no different than TikTok.
What TikTok’s brilliant about is if I watch basketball videos, they know I’m watching basketball videos. It doesn’t matter who I follow, right? They just know. And so they keep on funneling them at you. Facebook does the exact same thing, and it incorporates politics into that as well because that’s the nature of Facebook. You’re going to get that political commentary and news and videos and all that. So if you’re amplifying any content, I don’t care if it’s Dallas Mavericks content because it’s all Dallas Mavericks fans, no 230 protections.
I see what you’re saying. 230 is designed to help people moderate, to incentivize the platforms to pull things down. You’re proposing, and I’ve heard this from Roger in the past as well, you’re proposing if you amplify it, you make it bigger than it could have been on its own. But where do you measure that?
You don’t have to measure it. Either you do it or you don’t. So either you get content in chronological order, or you get it even in algorithmic defined order from people you follow. Period, end story.
[A] social network is supposed to be social. So if you and I have a conspiracy theory discussion and the people that follow us see it or are in a group we’re in, so be it, right? But if you amplify it so the conversation [of] my wife’s friend finds its way to you because the algorithms know that you’re interested in this type of content, but you have no idea who this other person is, the parent of my kid’s friend, that’s a choice to deliver and you deserve no 230 protections at all. And if that doesn’t work, then you look at going back to, okay, we’re not going to make you moderate everything other than the way we moderate now, but we’re going to make you go back to the old-school social network where [what] you get [is] based off of your followers.
A thing that strikes me about that, and I think this is why I’m particularly interested in talking to you about it — that is a pretty heavy-handed regulatory scheme. And maybe the government’s too broken to ever figure it out and pass it. But you’re now getting in there and you’re designing the architecture of the platform —
I don’t think it’s heavy-handed because the heavy-handed was with 230, right? Because prior to 230 —
So let me finish that.
Prior to 230, like when we were doing Broadcast.com and AudioNet, any piece of content that I have put on there, I had to have a license for it. Period. End of story.
So you’re saying because of 230, they’ve been able to create moderation decisions that they’re not liable for, right? They get to make whatever kinds of moderation —
They’re marketing decisions, right? They’re marketing decisions. You can’t put something on CNN, let’s just say this is user-based content, every day at 3PM, we randomly pick something from the internet and we ask you if you want to put it on CNN. They have to get a license before they put that on CNN, right? They’re not going to have 230 protection, that I’m aware of. Maybe I’m wrong, right, because that protection doesn’t hold to broadcast linear television. Bits are bits. Why should they be treated differently?
I think there is a very narrow, boring answer or argument to be had about that and what the broadcasters are able to do with user content from other platforms. But here, it seems like the challenge is, we’re going to change the incentives for how Facebook runs its moderation system, right? And so we’re going to take away 230 protection if you amplify it. You’re hoping that that one incentive change actually changes how they operate.
We’re simplifying them. Because a lot of their moderation comes from the negative impact of their amplification, right? So when you put everybody in the education camps and they all get Stockholm syndrome and all start agreeing on everything, right, now you potentially have a problem that needs to be moderated. So you saw that — what was the group they just shut down?
Stop the Steal.
Stop the Steal, yeah. So now you have all these people coming together and now they have a moderation issue, right? Now how do all those people come to commonality in the first place? It’s not like they all follow each other.
So this is what groups you’re recommending, what videos you’re recommending, beyond just what your friends are retweeting.
You cause the problem through the way you define your algorithms. And look, the whole nature of neural networks is they’re going to start not thinking for themselves, but when you... Neural networks are a black box at their base, right? You can’t just go back in and reverse engineer and just tweak one thing for a lot of applications, right? And so it’s not as simple as saying, “Okay, we’re going to moderate your algorithm so A, B, or C doesn’t happen.” That’s heavy-handed because you have to anticipate the outcome and then track it back to where you think it initiated, right? Versus just saying, “Look, be a social network. Keep out terrorism.” Keep out all the things, no titties, right, and you’ve done your job.
What I was getting at is — yep, that’s one way to do it. Isn’t the other way to do it to somehow make the market more competitive? That’s what I worry about. It’s strange that you and I are on different ends of that, right? Because what you and I often argue about is net neutrality, where I’m like, the market’s not competitive, regulate the hell out of them, and here we’ve flipped.
No, here’s the problem, right? The problem is with AI. There’s AI haves and AI have-nots.
TikTok is amazing because their AI is better than anybody. That’s what accelerated it. And it took them being part of ByteDance and spending billions of dollars to get there, right? Parler tried to compete with Twitter, right? Many people have tried to compete with Facebook over the years, right? But it’s going to be very, very difficult to give the quality of result back in terms of your interaction with any platform because it’s hard and expensive and time-consuming to do AI right. So when you look at the stock market and you look at the companies who are just crushing it at the top, they’re all the companies that are the greatest in the world at AI. No exceptions. Any $500 billion, $1 trillion or more market cap company, all of them do AI incredibly well and have spent at least hundreds, if not billions of dollars. Hundreds of millions, if not billions. That’s where the game is today.
In terms of AI, there’s just a limited scope of companies that can truly compete because this whole conversation we’re having — the foundation of Facebook’s success — is artificial intelligence, right?
Agree with that?
I mean, to an extent. I think there’s a big network effect. I think there’s a high switching cost.
Well, yeah, there’s the high switching cost, but the network effect... Early days, that was network effect. Now there’s that amplification we’re talking about because if the amplification wasn’t impactful, we wouldn’t be having that part of the conversation.
Well, so let me ask you this question another way. This is something I’m thinking about a lot and I’m curious for your read on it. I look at Google Search, which we know is a good business. It prints money for Google. And no one has built a good competitor to it. I think Microsoft just keeps Bing around because they don’t want to admit that all their users are going to switch to Google, right? But why hasn’t Apple built a competitor to Google Search?
For the same reason I just told you.
Because they don’t have the AI chops to do it?
Right. Microsoft doesn’t just keep Bing around because they don’t want to be embarrassed. Because they need to enhance their AI. If Microsoft made a quantum leap in AI, they could make a quantum leap above and beyond Google for their search.
I feel like it’s the same with YouTube. YouTube is a much simpler kind of product, right?
You don’t think so?
No. I mean, again, what are you feeding people? The underpinning of every conversation we just have had in terms of success and failure and competition is artificial intelligence. And the biggest challenge we have, and I say this all the time, is we have companies that are AI haves and AI have-nots. And what Google’s doing with search is not antitrust. They’re just better at AI than most companies. That’s all.
So look, Shark Tank season 12, you just filmed it. You’re an investor. Someone comes up to you and says, “Hey, everybody in the YouTube ecosystem is always mad. The inflection point for every YouTube creator is a video explaining why they’re mad at YouTube. That’s the end of their timeline. We’re going to build a better product for them.” Are you going to say, “Well, what’s your AI?” Is that your first response?
Two, three years ago, I looked at companies. I invested in one that just didn’t work, right? But today, yes, absolutely. And I get all these people come and say, “Oh, we’ve got great AI. I got this guy from MIT. This guy from Harvard. He’s the leading this, leading PhD.” So what?
As you step back and look at that investing landscape, what’s your decision-making framework? Is the first cut, “Tell me about your AI and let me validate it,” or is that three steps down the line?
Lately, if you’re trying to sell me on AI, I’m probably telling you you’re not really doing AI ... and you should do what you think you want to do.
Because it’s expensive. So they get $100,000 in AWS credits, or Azure credits, or Google Cloud, and they blow through that. And now all of a sudden, they don’t realize how much money they’re going to have to spend. Because running all these models and trying to make it all work together is not only expensive, it’s time-consuming and it’s hard. And then you’ve got to get the results. Just because you do it in an AI doesn’t mean the results are going to be impactful the way you want them to be.
You could spend a billion dollars on an AI search engine project, and it’s not going to be near as good. Unless you just get these rocket science people, that are just beyond the best of what Google and Microsoft and Amazon and Facebook have, and Apple and Twitter have, you’re going to need to find ... those people that are outliers, these outliers that are just beyond the intelligence of what these major companies have, then maybe you have a chance.
Do you think the kill zone is real? I hear from small companies all the time, “Look, there’s a kill zone. We can make something better than what Google has today, but they will see it as a feature and they will eat us, so we’ll never get funded”
That’s not a kill zone. Forever and a day, I’ve always asked the question, “Are you a product or a feature?” Right, so that’s always been an issue, and you’re always competing, 50, 60 years ago they were competing with IBM, then Microsoft you’re always competing with. Now with Google, then Facebook is just... That’s just the nature of the beast. But there’s not really a kill zone from a product perspective because most people don’t try to go head to head for their primary products, there’s just no good reason to. Any more than going head to head with Tesla has been hard. Why do you think Tesla has been so dominant in EV? Because Elon Musk is smart as fuck, and his technology, he always comes out with things what make you think, why didn’t I think of that?
And then not only does he make you think that, then he executes on it. So he went from competing with every major car manufacturer — and everybody who invested in him probably said, “Okay, I’m taking a risk, but you’re probably out of your mind. There’s no chance” — and he changed the game, right? . So it’s not like it’s not capable of happening, but you need five Elon Musks together that have... Elon Musk says he’s going to do the [tunnel-boring] machine, and he does it. He says he’s going to do a space rocket that lands again, and he does it, a recyclable space rocket.
You need that type of person in order to beat people at their own game when they’ve been doing it for 20 years. Google is not a startup, Facebook’s not a startup, Netflix is not a startup, Apple is not a startup, Microsoft’s not a startup. These guys have been doing it for a generation, and so you got to come with your A game, and that’s not to say there aren’t some people out there that are just fucking unbelievable and can blow everybody away. There are, but they know it, and they’re working on a vaccine, right?
Working on creating things that aren’t about search. Because if you’re trying to change the world and you are the best of the best of the best in AI? The last motherfucking thing you’re working on is search.
Yeah, because it looks like a solved problem with no entry.
And not even that there’s no entry. Let’s say you do it better than Google. Yeah, you can make money, but you... Particularly Gen Z, that’s not the goal. Making money is a by-product. Changing the world for the better? That’s the goal. And that’s the beauty of Gen Z, and that’s why I’m really hopeful about this country. Because that’s their mission, they all have a social construct of what they’re trying to accomplish. You know, sSo breaking up Facebook, you’re just going to have two companies doing the same thing, or three.
I mean, if you think Facebook is too big, you and I have talked to each other for years about telecom companies, and I’ve always thought those are too consolidated, and we’re kind of seeing it now.
5G is launched. It’s here. There’s a PCMag story, it came out today: the United States has the slowest 5G in the world. Hopefully it’ll inch up better. We have seen the AT&T consolidation. They own Warner. It seems like they’re making big changes. Jason Kilar is the new CEO at Warner Media, sweeping through it. Bunch of HBO people are gone. We’ll see what happens to CNN after the election rumors there. You think their eyes are still on the prize? You think the big telecoms are distracted? Because it feels like they’re all over the place.
Yeah, they are, because they hoped for linear television to last longer than it did, and it didn’t. But where they’re making their money is selling broadband, and where they’ll make more money is selling 5G.
But you also have to realize, and I’m not the expert here in terms of the technology for 5G, but Huawei was the leading provider, and the lowest-cost provider, and now all of a sudden it was gone. Then there were different decisions made on millimeter wave and what was the best approach. And, you know, iIt’s happening. It’s not happening as quickly as people would like, or the quality is not necessarily there the way people would like, but I don’t think there’s any question now, and I think I told you this when we talked, that 5G will replace wired broadband, and then 6G will replace whatever comes along there.
I think by the time this will come out, I can say this out loud, but here’s the [iPhone] 12 Pro Max. Right now I’m in rural America. I have two bars of 5G. It is not fast enough to replace my wired broadband here. I think the curve for that is going to take a long time.
But you’re a year in, right? It might not happen to you immediately, but the minute I can put a 5G MiFi in my house, because I have a decent 5G signal, done. Done. Places I travel where I know that there’s 5G instead of using wired Wi-Fi from a hotel? Done. I’m doing it.
They don’t have a choice but to compete, and that was always my thing to you, right? Because it was always localized or territorial at some level with telecom, and that territorial perspective is being decimated right now.
It’s being decimated, but there’s still only three national carriers. Are you hoping to see more regional 5G competition?
Even with three, because of spectrum, that’s going to be hard. But even with three, that’s two more than what you were talking about when we had our conversation.
That’s fair. You were talking about linear TV going away. Obviously, that’s a big deal for sports. It’s the last thing holding linear TV together in many ways. You are seeing, especially with AT&T, the bundle of content and access. T-Mobile just launched a TV service. That is, in some ways to me, like that’s the net neutrality moment. AT&T is going to zero-rate HBO Max, T-Mobile’s cable-ish thing, TVision, is going to be prioritized on that network. If the only thing holding all that together is sports, where do you come in and play?
It’s hard to say. I don’t have a good answer for you. I really don’t. It’s something I’m still learning and still trying to figure out. I don’t have a good answer.
What have your conversations been like?
Trying to find that equilibrium. How do we disrupt ourselves? How do we sustain our partners and do the right thing for our customers? You can’t just always maximize revenue. It’s not just short-term. You have to look long-term. Trying to figure out what our options are, that’s part of the challenge.
Have you thought [the NBA] about [the NBA] going direct?
Of course, but it’s going to be expensive. We also have partners. The Players Association isn’t just all of a sudden going to say, let’s reduce our revenue by X. That’s already happened with the pandemic, right? That’s your problem five years from now, but the life cycle of a player is 4.5 years.
You don’t like the idea of “Netflix for NBA,” where anybody who wants to watch the NBA pays the fee, and you’ve got the app, and it all lives inside of there? You don’t think that’s workable? I don’t think it’s workable, but I hear people ask about it all the time.
Everybody asks about it all the time. It’s trying to find that equilibrium, because you have to deal with all the stakeholders, including the players. We split our revenue 50-50 with the players, so it’s not a unilateral decision and it’s not just a technical decision. Technically, it’s easy. That’s not a problem at all. It’s more, what do our customers want? When do they want it? How do they want it? Where do they want it?
But do you think having three... Let’s say 5G works, and the Time Warner cable monopoly in New York City is finally decimated, and everyone’s getting wireless access and they have a bunch of choice. Now you’ve got three providers who might say, “Well, unless you pay us an access fee to our network—”
No, Wi-Fi is not going away, and we can still go wired. There’s still a variety of options. That’s the last thing I’m worried about because the one thing that would really... Again, particularly with the younger generation, with that social construct that we talked about earlier. That brand that does that? Say goodbye to every customer you have ever had or ever will have.
You just can’t get away with that anymore. It’s not 20 years ago, where you can have any color you want as long as it’s black. Those days are gone. Every individual, every Gen Z, every millennial for the most part, is a brand. If you happen to be that fuck-you telecom provider, no one’s going to want to be on that telecom provider. Your brand is going to be toast.
I’m watching these sort of new-look reverse carriage disputes play out in tangential ways. HBO Max isn’t on Roku, stuff like that. It is happening. Roku’s basically saying, “If you want to be on this platform, we’re the biggest. Just pay up.”
I mean, realistically it’s always your value.
It’s not driving people to switch away from Rokus yet.
Yeah. But Roku is not “it’s us or nothing.” You don’t have to use Roku. A lot of people don’t, and a lot of people don’t even know what Roku is. There’s no territorial limitations. “Oh, you live in Dallas? You have to use Roku or, you don’t use Roku.” It’s, “Hey, we’re marketing. We’re getting out there. We’re marketing nationally, globally, and we’re convincing these customers. If you want to get to those customers, pay me.”
It’s not, “We have this bandwidth. We’re one of three 5G providers, and pay us to be on here.”
Let me take a step back. The original conversation that we had was based off of websites, because that’s the whole net neutrality thing. Websites aren’t going to be able to get access, which has all turned out to be fantasy and nonsense. There’s never been five examples, maybe, over the past 20 years. That’s 12 years, maybe 15 now, of companies that have been tamped down, and those weren’t even company-specific type things. This is not a website issue anymore, and most of what you’re talking about in terms of streaming and access is website- or app-driven.
I don’t see anybody limiting apps. “Nope, you’re on Google.” Now, Google and Apple, that’s a different conversation, the limit they have. But I don’t think from a telecom perspective, I haven’t seen anything to even suggest that that’s a possibility.
To me, it’s the consolidation, to come back to that theme over and over again. It’s, AT&T, one day, will zero-rate CNN and charge Fox News for access. You might think that’s a great thing ... but I see that as like a particular kind of power.
I get it, but remember how Fox News got started? They paid for everything. They paid for subs, 10 bucks a sub per month. Because when bandwidth was limited, you had to pay to get access. I just don’t see it happening that way because the competition comes from another direction. The bandwidth isn’t necessarily going to be — bandwidth right now, the cost is becoming negligible. There’s so many different ways to deliver bits, whether they’re video or anything else for that matter. It’s just not going to happen. There’s so many different ways, and someone could put up a private 5G network where someone will just sell off spectrum and just do it within a small area. We’re seeing 5G networks within manufacturing environments.
One of the themes that you’re going to hear about on Decoder a lot is decision-making. I am very curious how people make decisions and the frameworks they use to make lots of decisions at once. We’ve all seen Mark’s decision-making happen on Shark Tank, that’s one part of it, but I wanted to know what his larger approach is.
So, Shark Tank’s a TV show. So I have an infrastructure and my time where I can help a lot of these companies just become bigger and better, and I’m helping entrepreneurs and I’m teaching people to be entrepreneurs. And these people that come on the show and present to us are setting the example that the American dream is alive and well. Those are all wins that aren’t directly related to how much money can I make. Where I’m making investments to change the game is... One of my companies is called The Mark Cuban Cost Plus Drug Company. Literally the name, because I wanted there to be no question about what we’re doing.
There’s a drug called albendazole that’s generic now, and it’s for hookworm. And there’s still hookworm epidemics in Alabama and Texas and other places. It’s $200 a course, this is a generic drug. So we created a company that went and ... right now, we’re doing two things. One, we sent somebody overseas to the manufacturer that makes it for another country. They made it for all these other countries, but no one would import it here because they wouldn’t take the time. And we sent someone over there to make sure the manufacturing was perfect. And now we bring it over here, we gave away thousands and thousands of doses to Baylor to test it all. And we were ready to give away more and start selling it to Alabama, but the COVID blow-up, that’s using up all their resources. But long story short, we’re selling it for our cost, eight bucks plus 15 percent, so we’re effectively selling it for what’s going to be our cost. It’s going to be $10.50 instead of $200.
So those are the types of things that I’m focusing my time [on]. We’re trying to do the same thing with insulin, and I’m building what’s called an API in one of my buildings in Dallas. It’s an advanced pharmacy something-or-other, I forget what the “I” stands for. And we’re just going to be making generic drugs and selling them at cost plus 15 percent. Period, end of story. We’re going to post it all on our website so you know exactly what our costs are, and we’re going to fuck the pharmacy industry.
Now, the challenge for us is, they’re so entrenched with how they do pricing and how they do pharmacy benefit management... we’re going to have a battle. And there’s no antitrust there. And you talk about kill switches, that’s typically what they do to drug companies, they’ll just buy it. Or they’ll try to preempt them. But we’re going... All those drugs that we can make, and some I’m not going to go into now because I don’t want those pharmaceutical companies to come after us. They’ve already tried to buy us through the back door, and it’s just not going to happen. Those are the types of challenges I’m really looking at right now.
There’s a project I’m working on that’s just in its infancy called Sickbank. There’s an economic model that says if at your company you get one week or two weeks [of] sick days? Well, if everybody contributed one sick day from their own personal sick bank of days available into a centralized sick bank, and the companies paid some amount of money for that day, let’s say it’s $268 on average? Then we can have a centralized sick bank, where if you get sick or I get sick, or Kara gets sick, and 14 days is not enough? You just borrow, up to another 14 days and then we’ll pay you based off of your salary because your company’s already put the money in. But just the economics work like a bank, a little bit like an insurance company. Different ways to approach the health care.
Those are the types of things that I get excited about, because I’m not... Even in tech, it’s all tech-driven. There’s all the tech underpinning, there’s AI applied in a lot of different things. But it tries to solve... Who knows if we’ll be successful, but we’re going to try to solve these social problems that need to be solved.
And is that related to... We started this conversation with government gridlock, the government’s not effective, our politics are broken. Is that just a direct reflection of your feeling that way?
Sure. Yeah, of course.
A lot of people would say... I think about the amount of people who look at GoFundMes for health care, and say, “Aren’t you — you just made taxes, that’s all you just did.”
Yeah, it’s ridiculous. Our health care system is broken. It’s a lot simpler than people are making it out to be, and the answer is not Medicare for All. One of the studies that I’m funding and one of the companies I’m working with right now — I just asked a very simple question. In Toronto, Canada, the province of Ontario, a hospital there has pretty much the exact same expenses as a New York City hospital. Real estate’s the same, doctors cost the same. Everything’s the same for the most part, except a couple of little things.
And before I go into those, No. 1, I looked at what does Medicare pay for the top 35 procedures, and what does the province of Ontario pay a Toronto hospital for those same 35 procedures? Thirty of them, they pay significantly less in Canada than even Medicare, and our hospitals say that they lose money. But the hospitals in Canada are for-profit. Not big profit, but they’re making a little bit of money. Now, what are the things that make the difference? The new beds being built in this country are single bed rooms. In Canada, they’re all multi-bed. I had kidney stones in Canada, so I can tell you. They’re multi-bed rooms—
I like the idea of being your roommate in the hospital in Canada, it’s a real picture.
Have you ever had kidney stones?
Painful, painful, painful. Literally sitting in a waiting room in Canada, in Toronto, Toronto Hospital, Toronto General Hospital. And I’m dying. I’m puking, I’m dying, and people are coming up asking me for autographs. And so they put me on a gurney into a section in a hallway just to keep me away from people.
But No. 1, just imagine the change in the cost structure for hospitals, if instead of being allowed to build one-bed rooms in a hospital, a newly built hospital or update, you had to do two? Just think what happens to the cost structure? Immediately lower.
Another thing in Canada, they cover 70 percent of the capex [capital expenditures], including property. One of the challenges in hospitals here is, they want to get bigger and bigger and bigger, because the bigger the hospital, the more things, the more money the CEO and management makes, the bigger shit you look like you are. And a lot of times, they’ll go into new lines of business, cardiac, orthopedic, whatever, that don’t always work but are expensive. And so you see paintings, you see pianos, you see all the shit you see in the hospital. And they’ll raise money, whatever. They don’t do any cost accounting on that, and so they don’t know. Literally, a lot of hospitals don’t know how to account.
So they use this thing called activity-based accounting, which allows them to kind of lie on these reports and make it seem like they’re losing money. Well, if we just changed it, so that for any capex the government will cover 70 percent of it. You figure out the 30 [percent], so you don’t just rip off the government all the time, and we’ll make it work. So those are two big things, and then, there’s some other little various things, that we don’t have to go [to] Medicare for All. The foundation of what makes it work in Canada is, [the] government isn’t all that volatile. They don’t have the Donald Trumps of the world, at least not yet. Because if we tried Medicare for All like I mentioned a little bit earlier, and then you get another Donald Trump type in and he just tears it apart? Now we have no health system. So you need to have competition, but you’ve got to pick the right way. So that’s another project that I’m working — actually, multiple projects that I’m working on.
It’s interesting, because the ones that you’ve talked about? They’re in industries where there is rampant consolidation, right?
Yeah. My parents are doctors, their hospital system... Where I grew up, there used to be eight hospitals, and now they just slowly all merged. And my joke was always they worked at competing hospitals, and we could always pick. And it’s just... Inevitably now, they work at effectively the same one.
So part of the problem is competition. So if one of those hospitals has single-bed rooms, and they’re part of the network from your company? Then the other hospital better have single-bed rooms. And if you’re not part of that network, then you’re going to have to compete to get access to it. And look, the insurance companies have no incentive to pay less. So they’re paying the biggest hospital, the most marketable and best brand, more money than they should. Because after their medical loss ratios, they’re making 15 percent of a bigger number, which makes them more money. And the hospital’s getting paid more, so they can put up more buildings and build more shit that may or may not be needed. And then the hospital who doesn’t win those battles, or hospitals? See ya. They’re gone.
But isn’t that root, that consolidation, that drive to get bigger and bigger and bigger? Isn’t that the heart of many of the problems?
Not even a tiny bit, nope. The heart of the problem is, there’s no transparency on cost. ... You know, the Trump CMS [Centers for Medicare and Medicaid Services] did this, where they’re making you publish your prices coming up. And so you’ll be able to have actual prices and see that, and you’ll be able to do some shopping where you can. But the reality is... Look, I’ve turned into such a health care geek. There’s this thing where they do all the Medicare pricing analysis and everything. And I’ve read their transcripts, they’re the most boring shit ever. And a lot of the foundation of the problem is hospitals saying all the time, “We can’t make money at Medicare or Medicaid rates.”
And so that is the fundamental issue. And so if now you can’t make money, and everybody believes that’s the truth? Now they’re just getting paid more and more, that they’re just spending on all this other stuff. And then there’s two other things that I think, that I will bring in. In Canada, they pay for the malpractice insurance for the hospital. That’s the smart thing to do. In Canada also, and it would help the hospitals have smaller sizes, every procedure gets paid for, every single one of them. And so part of the health care thing I’m working on, every procedure gets paid for.
Because what happens is, you can walk into a hospital, and if you don’t have insurance, then there’s a whole process... You still have to get a certain amount of health care, then there’s a whole process that the hospital has to go through to get reimbursed. And that should be taken care of, and that reduces part of the risk as well, because that’s just basic health care rights. But we don’t do that here. We make it circuitous, we make it circular to try to get hospitals to get reimbursed.
So these are all common sense things that can make a huge difference, that we can learn from Canada and wouldn’t be all that difficult to apply here, without going to the extremes of Medicare for All, where you kill private industry health care. And if that happens and somebody who just hates the Medicare for All and guts it, like we’ve seen try to happen with the ACA? We’re not caught in that Catch-22. Because there’s no way to prevent some executive order from being written from a president in the future that says, “Okay, the mandate’s gone.” Just like Healthcare.gov has gone in Georgia, you can’t protect against those things from happening at all, and that’s the real underlying problem for Medicare for All.
Do you think this work that you’re describing happens in the market at the entrepreneurship level, which is kind of where you’re describing it? Or are your eyes on the prize? Are you thinking that you’re going to go be a policymaker? Because the conversation we’re having sounds a lot like a policymaker conversation.
Yeah, no. But you need support at some level, and being the policymaker doesn’t help it at all because there’s only so much you can do. But yeah, I’ve sat... I tried to explain this to Trump.
Give me a story about you talking to Trump.
I mean look, the genesis of all this with health care is once McCain gave the thumbs down to repeal the ACA, they still needed a repeal and replace at some level. I’m like, “Okay, if I was going to do a repeal and replace, what would I do?”
I started going through all this stuff that I just talked to you about, and I went to present to Jared Kushner and some of the other people, and Alex Azar. Their heart was in the right place, but the politics was in a worse place.
I just happened to be in there, and they’re like, “Well, the boss would like to see you.”
And I walked in, I’m like, “Okay, what the fuck is he going to say to me,” right?
I know we had our little disagreements on stuff. No big deal. I sit down, and I started talking about what we’re trying to do, like I just was talking to you.
He’s like, “Okay. So, what do you think about me selling... You know what? Did I tell you I did a deal with Boeing to sell planes for them?”
I’m like, “Okay...” He just... subject to subject to subject, which is fine. It was 20 minutes. Then I’m getting up to walk out, and I had one of my Shark Tank suits on. He goes, “Damn, Mark. You look good. Have you been working out?”
Well, at least you got the compliment. A tailored suit makes everybody look great.
That wasn’t tailored. It was off the— Well, it was tailored from off the shelf.
We only have a few minutes left, but what I’m realizing is that you and I have opposite view points, depending on where we are in the stack. Down here at infrastructure, I’m like, “You got to regulate it. The government should do stuff.” Up at the very consumer-facing, how does Facebook work, I’m like, “I think we should break them up and have more competition,” and you’re like, “We should tweak their algorithms.” That is a really strange spread.
I’m not dogmatic about anything. Nothing. I’ll look at every problem, and I’ll say, depending on what we’re discussing, how can it help the American people in one way or the other? Sometimes enabling business, that’s what you need to do. You want companies to grow and be successful. Sometimes it’s technology in [a] unique context. Sometimes it’s health care and it’s just a motherfucking right, and we can’t figure out how to do it right.
That’s part of the problem going forward on all the politics, because I’m terrified from either side. The Republicans are dogmatic about trickle-down and the Democrats are dogmatic about their version of trickle-down: “We’re going to give it to a government program, have people apply, and hope it trickles down to the people who need it.”
We learned from the stimulus and the fact that stimulus will help us now. Not more programs, but stimulus. We learned “trickle up” works better than anything. Hopefully we’ll learn that going forward and you won’t see Chuck Schumer or Mitch McConnell being dogmatic and doing this because this is the way it’s always been done.
It seems like whatever happens next in the Biden administration, the fundamental question will be, “Can they actually operate the government?” Because these questions are pretty massive, and no matter what we’ve talked about, they require some amount of actual policymaking to get done.
If they can get it passed. To me, the ultimate Biden skill set is, can he lead? Can he bring people together? Because that’s what we need more than anything, and if he’s able to do that, then the legislation will probably be fair as opposed to dogmatic.
My greatest fear, as I said earlier, is if the Democrats win the Senate and Chuck Schumer turns into the Democratic version of Mitch McConnell, and he just does everything that Mitch McConnell did, which was horrific, but to the benefit of the Democratic Party. We start talking about Chuck Schumer putting party over country, and that leads to more civil problems and challenges.
I guess what I’m saying is, I don’t trust the Democrats to do the right thing because power corrupts, and absolute power corrupts absolutely.
Decoder with Nilay Patel /
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