Featured Session: Enough with the Bullsh*T: BuzzFeed Founder Shares His Plan to Make the Internet Fun Again

Please welcome to the stage, Jonah Peretti and Bill Sholtis. Hello everyone, good to see you today. So, um, is that a clicker? Clicker would be good. Oh look it's saying a clicker would be good. That's the uh right there. Um so um we can advance the next slide if there's. I think they're more stressed than I am about this shift. So, the media industry has a problem, and I wanted to talk a little bit about what that problem is, how we got here, And then talk a little bit about some of the steps that we can take to move forward. So, let's go to the next slide. So, the internet has made content distribution almost free. Now making content distribution almost free is, sounds like a good thing in many ways. It's a good thing. Um, early on, We really took advantage of the free distribution of the internet, and we spread stuff all across the internet. Um, But there is a challenge because media companies you can go to the next slide, make money from distribution. I really need this clicker though. I don't if I say it see there we go okay There's like ninety slides. So I won't set that ninety uh ninety times um so the internet has been kind of. distribution almost free, and media companies historically have made money from um from um sorry, I'm like totally uh totally discombobulated here. All right, let me just uh let me just uh start fresh. So, what happens when it's easy to? Uh it's super easy to distribute and make content? Is this is there something that's like off. So historically, media companies have made money from content distribution. And that meant things like satellite dishes, printing presses, buying a bunch of trucks to drive the newspapers around. It meant owning movie theaters. It was really hard to distribute content. It was really hard to distribute media. But because it was hard, it meant that media companies could make make money from it. Um, If you tried to compete with a newspaper, but you didn't have printing presses and you didn't have trucks, you couldn't do it. And. So that was a big source of friction, but also a big source of revenue for media companies. Um, and when the internet started to make content distribution free, it made it harder for media companies to charge for distribution. Um, and so um media companies could distribute. Um, could distribute media um and get paid for distribution, but when that started to break down, they had to turn to other things. And so um distribution has moved to streaming; it's moved to mobile. Um. And it has um really made the uh distribution of media a much more challenging um way to make money. And so after that, um so the slides are kind of in a weird order, so I am kind of just associating. None of the slides are in the right order. So, I might just kind of do a more improvisational talk. So, the. Right now it's like most. (Applause) Appreciate that. Appreciate the support. It's actually more. It's a lot more fun this way. So. Most distribution now, if you look at like maybe ninety percent, ninety-five percent of the time people are spending consuming media, it's on things like streaming and mobile. And that's something that has completely sidestepped the entire apparatus of the media industry. And. So that means that media companies maybe have to look in a different place. If you can't make money on distribution, maybe you can make money on production. And so the production of media is something something that media companies have historically been very good at doing, and it's another thing that is hard to do. Think about Marvel movies. You have IP, you have talent, you have huge production budgets, And that has enabled companies like a Disney to make huge amounts of money by moving up market and making things that people in their bedroom can't create. So maybe you're a person who's just. in your basement, you can distribute content anywhere. But unless you are a big studio, There's no way for you to um there's no way for you to make a Marvel movie or make something that's super. But what's happening now is that media companies um oh cool, here they are. I think the confusing thing is that well whatever. I see different things here but they're not showing up here. These are so these are some examples. These are some examples of production being a skill of media companies. You know, Matrix bullet cameras. This from Game of Thrones. Like, if you look at the um if you look at the um level production value, This distribution might be free, but making this hard, and media companies can make a lot of money from making things, from uh contracting big stars and all that. And. So that became a lot of the focus of the media industry as production as just. distribution became less and less lucrative. They started to focus on production. But now we're seeing AI starting to erode and make it easier to produce content, including content that looks very professional. And I'm going to show an example of it. But, what we're seeing is that creators and now AI are making content at a fraction of the cost while eroding IP rights. And so. I don't really know how to show the media. Someone can help with that. Not. I can hear them from the back, though. Maybe I'll act this out. So this uh um. This uh, Have people seen the clips of these um Chinese AI models that can make like Hollywood stuff? Some movies, um. What's it called? Like C. Uh what's it called? C-Dance. C-Dance, yes. So, I'm going to right now act out a C - D ance movie because the video clip isn't showing. But C - D ance is making these clips where Tom Cruise and Brad Pitt are in the movie, where special effects are happening, planes are crashing. These are the exact things that Hollywood studios have moved up market to make to avoid competition from the internet. And so if you can distribute little content and cheap easy things on the internet, the super-produced Hollywood film is something that. The internet couldn't disrupt, and now you're seeing AI start to make those kinds of content, make that kind of content. Um, and you're also starting to see. uh. reporting what's being called a geomagnetic storm. I need you to hide. Get on the ground. So that's uh that's one example. All of that was um AI created. Um, this is another example of still where they're putting, you know, without the permission of these of the talent, they're putting um actors into the movies and having fight scenes with the movies. Um and then even um social optimized, uh um video is starting to take over social feeds. So anyone who spends time on TikTok or Instagram will have seen stuff like this. And that's so cute, right? You have the little mama dog, bringing her pup up and sleep with the two twin babies. There is another one that keeps going viral in different forms, where people where there is an adoption agency for dogs, where the dog picks the person, and you have a person sitting there, and the dog comes up. And then some starts weeping. And, they it's getting shared. And you look at the comments and essentially almost all the comments are people saying, oh my god, I am crying. This is so um you know, heart wrenching or whatever. And then there is like you know one in twenty comments like this. This is AI, even the AI detective, you know. But it's starting to not matter, And people are already seeing so much fake news in their feeds that they scroll through. And they're just seeing flop anyway that it mixes right in. And it's all just like doesn't really matter if it's real anymore. And, so both Hollywood film and social media is being disrupted by AI production, making it cheap and easy to create content. And this kind of AI will only get better from here. There was a. The New York Times published a quiz or a survey where you could see passages, one was AI and one was human. Um, And you could you could read them both and select which one you like better. And what they found was that there was a slight preference for AI writing. Now if you tell people it's AI, then they don't like it as much. But if you don't know, If you're not sure which one is is and you just ask which one's better, that it was slightly greater than fifty percent of people preferred the AI writing. So we're seeing it in text, we're seeing it with social media video, we're seeing it with Hollywood style film. All of content creation is going to get cheaper and cheaper. And. So just like the internet made distribution really cheap and that destroyed tons of value, Now we're going to see content creation get really cheap, and that is also going to destroy tons and tons of value. Um, and so media job losses are already underway. Big tech is gaining trillions of value. Um, and the internet and AI shift is just starting. So um if you see. The distribution trend with the internet, that's taken twenty years. The AI is only a few years in, and we're going to see both distribution and content become much cheaper. And so the tech companies have really benefited. And if you look at the market cap of the tech companies, you can really see as they sort of took over distribution, free distribution on the internet, they gained a lot of value. And. Now a lot of it is anticipated future value that they're getting a huge amount of value from the ability to. automate the creation of content and make content fully commodified. And so these algorithmic feeds print money, they can find free internet distribution and cheap content, and big tech is really taking all the value from media, but they haven't really fulfilled the same social and cultural responsibilities as media. So whatever you want to say about media, people like to hate the media company, I mean media companies and the media in general. People who work at media companies. care about content, they care about accuracy, they care about trying to have a cultural impact. If you can talk to the leaders and CEOs of the biggest tech companies, they really don't care about content very much. They see it as data. They just they see it as a way of generating revenue and a way of generating growth for their shareholder. But they don't really have a taste or feel for the content. And so, they're not really fulfilling the social responsibilities that media industry used to fulfill In fact, most people surveyed in a recent survey wish that social media didn't exist. This study by the National Bureau of Economic Research found that the majority of respondents would prefer to live in a world where TikTok and Instagram did not exist. And in fact, Many of the respondents said they would pay money if they could make TikTok or Instagram disappear. But, they would need it to disappear for everyone because they don't want to be the only one, not on the app. They're like, "If we could all pay fifteen dollars and have it." Here, I would totally totally do that. Economists call this negative value. It's a negative value product. If you are willing to pay to not have the product, It means it's a negative value product that you wish you didn't have in your life. And cigarettes is the closest analogy of products like that, where people would pay money to not use the product. So we need a solution. So so what is uh what is the solution? Um those those if distribution and content production are two ways, media companies historically made money. are no longer valuable. Value will move to what is scarce and to what is hard. So, um, what is it that big tech can't automate? And what is it that where where value will flow? And the big areas are taste, culture, and community. I think you may have heard in various writings about taste, about taste being really important. Um, but I am going to go through sort of each of these. So taste: What is taste? Um. So, apps and services with quirky, imperfect user experiences with great vibes. So, I picked some examples. Mid Journey did a great job with this. A lot of the Mid Journey usage is because of the taste of that product. New York Times games has a very distinctive taste. I don't know if you ever play Monument V alley ; you have like a six or seven year old kid playing Monument Valley with them. ; it's incredible ;. It's like a great game with. Incredible case, Red Dead Redemption is another game that has that. Culture is another huge, important thing that is hard, is scarce and special. So apps and services that create shared experiences, that break personalization bubbles, um, that are the same thing that everyone is looking at. So niche fandoms, Mega events like the Super Bowl will continue to be really relevant sites and apps with strong. Strong values and strong POV, where people feel like they're having a shared cultural experience because they're all looking at it together. And then community is kind of the third thing that I think you really need to focus on. So, apps and services that bring people together to connect memberships, real world events, running clubs, niche social apps, community ownership. And I think this last one, Community ownership is going to be increasingly important because so much of the apps we spend our time on are. value from us, and I think we don't get any of the value as users. And I think users owning apps is going to be a bigger thing. You know, you should own the platform you use, not just have the platform own you. And so those are the sort of three big areas. And earlier today, earlier this morning, I was like walking through Austin and I was thinking how a lot of these future trends are already happening. If you look at a company like the biggest media company, The Walt Disney Company. The parts of their business that are about community and shared experiences and culture at pace are doing much better. Think of the theme park business taking on a bigger percentage of their overall revenue. And the parts of the business that are about distribution and creation of content are doing worse, comparatively. And I don't think that is an accident. I think when the internet and AI start to will just accelerate these trends, The internet started them and AI is going to accelerate them where people are going to be looking for pace, community, And cultural relevance to be the thing that makes their products continue to be important. And so, what does that mean for you? You all work at various companies and startups and businesses. You should look in your industry; AI is coming for your industry, it's coming for every industry. You should think about how can you focus on community culture and taste in your product, in your company. Where are there places where if you are just making content or distributing content? That is not going to work nearly as well as things where you have culture, taste, and community. So here are some quick things that we're doing at Buzzfeed. So our news brand is HuffPost. And HuffPost has a very clear point of view, very strong values. You may have noticed a lot of news organizations have started to like change their coverage to not offend a certain administration. And HuffPost has just stayed very true to its values and, The people who read HuffPost really appreciate that. They feel like it's a place where they can feel sane in an insane world. The front page of HuffPost is a cultural experience that people go to every single day, and it's a shared reference point for the readers. And community has become a bigger part of the business. So, The White House replied to one of our reporters who was asking a legitimate question with " your mom." And so, as the reporter returned that into a campaign or membership campaign. And, we launched a membership campaign that resulted in a sixty six boost in membership sign ups. In response to that, And we literally received love letters from our members, people who appreciate reading our posts every day and are like, "Thank you, I am so glad this exists. This is something that you know I really value. " And that is partly why we've seen a seventy six percent increase year over year in growth in new members. and A hundred and seventeen percent increase in reader revenue as readers want to be part of and invest in and be part of a community of the things that they access online. It's not so much about just the content and the distribution of the content, it's about community connection, shared values, and taste. And at Buzzfeed. We've really been leaning into a similar set of things with community culture co creation, and identity being a bigger part of what we're doing. So what some might call. golden age of Buzzfeed in two thousand and fourteen. Um, We you can see we were at the very top of the rankings of Facebook publishers. That was when there was massive distribution of content on Facebook, something that doesn't really exist anymore. And. So much of our readership was people who just clicked on a Facebook link, read one funny article, maybe they shared it, then they went back to to Facebook or to the social app. It was lots of casual flyby traffic. It was viral traffic, And I would say a lot of people saw and knew about Buzzfeed because we had stuff going viral everywhere. If you look at Buzzfeed today, it's a totally different story. We are now number one in our set for total time spent, But almost everyone can see that blue part of the pie chart is coming direct. So the people who love Buzzfeed are coming directly to B uz zf eed ;, they're coming to our app. ; they're coming to our site. They're spending more time on the content, they're engaging with the content more. But the people who don't really know us or read us that much aren't seeing stuff flying around the internet. Love the way it used to. So, the internet has really changed, And you really need to build something for loyalty and closeness of connection with your audience. And. So that meant investing in the comments section with a twenty five percent increase in engagement of comments. And we don't want to be friendly. sections on the internet. And then co-creation with identity quizzes, making, taking quizzes, sharing quizzes with your friends. And, this has been such a big thing for us that we are developing a new app called Quiz Party, where you can take BuzzFeed quizzes with your friends, and you can all see what everyone gets, and you can share them and connect in a way that really enhances community. So here's a quick little preview of that app. You can find it. quiz or create a quiz on almost any kind of topic you can imagine. So, what kind of South by Southwest attendee are you? You answer the questions and then you see a result. So I got Media Mansplainer. And then, oh, there's Katie, one of the branch office co-founders got Just There for the Barbecue. Sarah, another one of our co-founders got Joan Curtis from One Kansas City Sarah. Appreciate that. And then Bill who you'll hear from, every AI panel also participating in them. And, then all of those can go into an app where you can comment and roast your friends and discuss the results you got. And. So it's really less about the content itself, and it's more about creating ways to build community and connection and have a shared sense of values, a shared sense of taste. So that's some examples of what we're doing, but the biggest thing. We're doing is we um are sharing today that we are um launching a brand new company called Branch Office. We're spinning it out of Buzzfeed. Um, We've been working on this secretly for um over a year, and we've um learned a lot from the Buzzfeed platform about what is coming with new kinds of AI formats and um AI formats that are not about, you know, well I'll I'll let I'll let Bill who's about to come up explain what it's about. But using AI is a way of connecting people, building community around these pillars of culture and taste and community. So with that, I will invite Bill to come to the stage. Thanks, Jonah. I read over my email and I thought you said reorder slides, but you actually said read over. So, it's alright. It's alright. That was my bad. It was I shouldn't have had my agent give you my email. All right, good luck. Hope it goes better for you. I mean, I see this is current and next to me is the other Sam's back, but so hey, I am Phil Shuldes and excited to tell you more about our incubator branch office and preview some of the products here coming out. So we're treating software as a. It seems we're kind of really iterating on software quickly and building kind of the taste culture and the community that's using the products. But he's been building AI as creative media for like the past ten years since two thousand eighteen. I guess twenty eighteen It's not quite ten years, anyway. But so with this, we've been doing a lot of content experiments after the AI boom with ChatGPT. So we made a bunch of products like a. Game where you could raise a nepo baby to be fiscally responsible with his trust fund. We also did some brand work. We made a Halloween costume try on for Petsmart. And we also had a focus group, uh, all tested a chatbot where you try to talk down a Karen at Starbucks. But the results were conclusive: everyone hated it and we never released it. But we did about fifty or sixty of these different formats and projects. We got a lot of insights. So, we wanted to take those insights so we could build something bigger. So, like a lot of AI companies, at first we thought, "What if we made a wearable?" So. We started prototyping some. Sarah made a smart septum ring. But it had a lot of issues during allergy season. So then I realized, let's move the ring to the ear, but this just caused a lot of neck pain. So. Then, we saw the competition. And how could we compete with such fashion forward? Tech billionaires. And, since we don't have the massive R and D budgets of big tech, or we're not building foundational models, we decided to take a different approach. Jonah early on mentioned that we should kind of follow Nintendo's product philosophy of " ludicrous thinking with withered technology," which. is really a weird way of saying, "just take the tech that's available and make it the most fun." So we've been thinking about that. Obviously, With AI wizard, technology is a little bit different than it was for Nintendo, because technology is wizard like every two weeks. But, this led us to really focus on making some apps that are really fun for the gamer generation first, even though AI video has been on the rise for a bit now. So as we're assessing the market, we saw some common patterns. A lot of companies want to replace humans. A lot of them want to create humans. But, oh, They also want to do good assessments over AI products like this AI psychosis here with machine. But, um we wanted to connect humans with one another with their friends. And because we found AI worked the best when people co-created together and made things for each other. So, just some of our principles is that we do believe human creativity should endure. We also believe that curation by humans in the loop is really important. So we don't drown in slop. Because, we know that AI can mimic human taste unless maybe like Gen. Alpha is cheating blue. Now for some kind of looks - maxing thing, but I am not going to get into the all mine, but I don't know. So, this is going to bring us to our first product, Island. Island is a platform for the group chat. It's basically a place where you can make something to cheer up your friend, celebrate a big moment in life, or to have a really passive aggressive argument with your partner. If you can't see that in the back, It's you know a pretty rude comment on a post. We know about Jerry Springer. And so Island basically it's chat, But there's always AI features where you can do straight text instead of chat and also live. But it's easier to just show you the demo. Um, And this demo is a totally real conversation that the team had this week when we saw the South by Southwest schedule. Not fabricated at all for this event. Make a promo video. So that was what we call riffing on Island, where you can go back and forth with your friends, changing your photos, editing them, just have a good time. But Island's also a place where there's a lot of curation. We have our editorial team following all the latest trends. And there's a whole library of inspiration on the app. So all types of things: memes, What's ever going on like chronically online to be inspired and have lots of fun things to constantly make. Also, we had different guardrails in some of the other platforms out there. So, ultimately, ION's like a very unserious app to just have friends and enjoy the internet. Have fun with your friends and enjoy the internet. Hopefully you have friends on there. Our next app though that we're releasing is very serious. So it's called Conjure, and Conjure answers. An existential question. We all had : " W here. What if real was set in the universe of the files?" Let's check it down on this. It'll help explain, But the setup is each day, an entity that you don't know is giving you a direction for photographing each day. Do you have it open? Is this what it asked for? Yeah, yeah, I think this is it. What is that? That's Conjure. It's going to be coming out soon. It's also similar to a dating app, and that just photos of the day every day. Also, I did lie earlier, when I said there was one human job. We want to get rid of, and it's the CEO. So Conjure does have an AI spirit for a CEO, and they will be taking questions shortly. So if you want to drop questions in the Slido. And conjure will be available on the app store soon. And we'll have a sign up you can be notified when it comes out. But I think Jonah's going to come out now.