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Was the best kept secret about that game, charlie. Rose we continue this evening with ken auletta of the new yorker magazine talking about the future of television. It is the same thing going to happen to television as happened to music, newspapers, print . And that is one of the questions i began with and i thought i would use netflix as a vehicle to look at that story and you come back with two answers, yes and no. In many ways, television is being disrupted in a dramatic way and net 36 is a perfect example of that. People can watch it without watching ads, they watch it any time they want and watch as much as they want. Rose right. And they can watch it on any device they want. Rose we conclude this evening with abbey klaasen of advertising age magazine, and some of the commercials that you will see during the super bowl. One of the hallmarks of the super bowl is when everyone has their a game, you know, they are producing ads, they are very expensively produced ads, generally, they are the ads that marketers spend a lot of time thinking about, how are these going to be entertaining, now the flip side of that is, they are supposed to sell and i think times they spend too much times thinking about how do we entertain with this ad and forsake the actual whole point of this expensive buy which is we have a product. Rose joe namath, ken auletta and abbey klaasen when we continue funding for charlie rose is provided by the following. I have been around long enough to recognize the people who are out there owning it, the ones getting involved, staying engaged, they are not afraid to question the path they are on, because the one question they never want to ask is, how did i end up here . I started with those people, people who want to take ownership of their investments like they do in every other aspect of their lives. Additional funding provided by and by bloomberg, a provider of multimedia news and Information Services worldwide. From our studios in new york city, this is charlie rose. Greatness isnt patient and it wont be compromised. Joe namath was great, and he knew it. Rose Broadway Joe Namath is here, 45 years ago he guaranteed the new york jets would be the, beat the baltimore colts in super bowl 3 at the orange bowl in miami, florida, three days later they did what many consider the greatest upset in nfl history, he was, he was the games mvp and returned home to a heros welcome that never really ended for new yorkers he was in new york for sundays super bowl between the Denver Broncos and Seattle Seahawks and pleased to have him here at this table, thank you. Than thank you, as the thrill being here with you, buddy. Rose so tell me how you see the game. Oh, man, how much time do we have, you know . These are two very good teams, of course. Either one of them can beat one another. You can almost go back to my old college days when my college coach, coach brian, paul bryant saidly keep you all from beating yourselves, maybe the team that beats themselves that night with penalties, with mistakes, turnovers loses the game. You know, i think denver has more capability of scoring points than the other side, but the other side can create some turnovers, so if i knew who was going to win i would call home and tell my brothers to start with. Rose but i mean, just some football wisdom, does generally a good defense beat the good offense . Yes. Generally, at least when you go back through the years, but i tell you about this particular game and these people, Peyton Manning is a different animal, the game is a little bit different, you have the 30 second clock there to get the ball snapped and put in play, you heard the of the old chess game between offensive coordinator and defensive coordinator, here is a guy that is controlling the offense from the field better than anybody else ever has, and also utilizing that clock at the same time. Recognizing where those defensive people are and getting down to the last ten seconds, eight seconds of settling in and calling the play and getting it snapped. So i think to the advantage certainly goes to the offense of denver when it comes to that matchup of what plays best to, plays best to run against a defense you are anticipating, denver has that advantage. Rose i asked Archie Manning, suppose you at your best moment and eli and peytons best moment who would throw it further down the field and he said eli, i think eli would of the three of us but he said being a Great Quarterback involves so much more. I have often said, Archie Manning is the best quarterback i have ever seen, not in the pro football hall of fame, and thats because he played for the new orleans aints all those years, it is a team game, charlie, thats right, it is a team game, and if archie ever had a team with him the rest of the pieces, he would have won a championship, all of us, we quarterbacks, peyton, sunday night, right . Russell wilson, how those guys up front perform, thats what is going to give peyton a chance to throw the ball, to get it done. The game is still decided, start up front, the offensive line and the defensive line, now one, if that defensive line of seattle can whip those guys up front it is going to be a long night for denver. In other words they will get to peyton. Thats right and you wont be able to get the ball to those good receivers. Rose wont be able to look and find them either too. You need the horses up front on both sides of the ball, offensively and defensively, the guys in the pits. Rose okay. So if peyton comes to the line of scrimmage and is prepared to take the snap, what is he looking for . He already knows where he has come from, he already knows where he is going, what down and distance, what that team does, what they have done on the upcoming down and the distance that you have confronted, say he is coming after second down, now it is third down and sticks, he already knows what to anticipate or what to expect from the seattle defense, with the personnel they have out there on the field, or with if personnel he sees coming in there. Now that team is so quick the mental part of the game is very important. If these linemen couldnt grasp the change of the play calling at that line of scrimmage or the snap counts, they couldnt be efficient, so you have got to have some pretty smart guys up front there in the line of scrimmage too, but pay gone is already thinking ahead, knows that, every quarterback should be, but some do it better because of the repetitiveness of the experience they have, peyton is thinking about the personnel and who is coming on the field and analyzing all of these things and already knowing who he has on the field, he is already putting them in a formation. They may not even go to the huddle, they dont a lot of the times and thats where this play call comes into play also, he can wait to the last ten seconds and get a good idea of what he is going to be confronted with over there defensively and call the play and get it snapped now the defensive people have gotten smarter too over the years and they give peyton some phony looks and false looks but i think denver has the advantage because of Peyton Mannings ability to anticipate, to read the presnap defenses, bear bryant says you were a great athlete, you played, think about the kind of quarterback you were, if you were coming up today, would you be a different kind of quarterback, because the game has changed i would be a better quarterback, number one, these guys are blessed to know that the coaching is beautiful these days, the coaching is so much better. They have, they have had a history of great coaches in the sport to study, they have learned from the coach bryants and the woody hayes, the coaches, don shula, halls, paul brown and studied these coaches and they are so dedicated the job, you have to have the passion because the hours, they spend their lives coaching. The last several years with the electronics, with the taping of games, the ability to study every little detail, have them broken down through the Computer Systems and all, they know what they are doing better today than ever. And plus you know the animal. We get better guidance the last 30 years, better ways of training, better food, you know, smarter. Rose right. So, yeah, i would love to have had the opportunity to play today with the guys that are leaders and the coaches, but you know what . I dont need any do overs, i am certainly happy with the run. Rose you had a good run when you look back at the San Francisco kaepernick, what do you think of the game he play. I like it, you know, again. Rose he is a tough guy. Going back to the street, going back home, going to college, high school, the best plays to me as a quarterback where where were where you have more than one choice, the run pass option, the options more than one choice, kaepernick got there in San Francisco, russell with seattle, he gives seattle offense, sure, russell gives the seattle offense an edge too, different than what denver has seen recently, tom brady stayed right in the pocket, he got out one time by the goal line but wilson can buy time with his feet and get around and throw. Which puts a heavy burden on the defense, being able to keep up with those receivers, so i love fran dark on the. He was out of his mind. Plan dark on the was beautiful he was wonderful, a Great Quarterback and drove defensive people nuts and he was very fortunate. He played 15, 16, 17 years and never missed a game, i dont think. He was blessed until the end he hurt his knee, you know, but the run passability, being able to move around puts a bigger burden on the defense, no doubt. What impact did bear bryant have on you . You made your way from pennsylvania to alabama. To be coached by what many believe is the greatest coach, College Coaches to be in College Football what did he teach or give you . A work ethics, a truthful ess or an honesty, respect for others, a fear of failure, not liking, i didnt like losing in the first place, but he made it tougher on us when we didnt know enough even in practice, man, i mean you learned to do it the right way, his way anything worth doing is worth doing right, that kind of stuff, coach bryant was a humble man, he was very respectful, and you wonder, you want to win for him, you wanted to win for him. He didnt pet people, hard workers, he loved guys that had more ability than others. He was harder on those guys, it seemed. Rose i talked to paul allen today and he said to me the thing they most loved about pete carroll was that he could communicate with his players. He had the ability to communicate with his players in a remarkable way. You know. Thats right. Well, that is good, that is remarkable. You know what . When you are winning, everybody is happy. The communication is pretty good. But i promise you i know of coaches that have won championships and the players that were playing under them disliked their leadership very much. There were winning coaches that werent particularly loved by their players. Rose let me take you back to super poll 3, super bowl three. Did you. What caused you to guarantee the victory . Being told we were going to get whipped. Rose by whipped. That we were going to get whipped, i mean for ten days, if you paid my attention to the weed, we didnt, to the media we didnt have a chance, thats right, it was everywhere, radio, television, you couldnt duck it as a ballplayer you try not to read about yourself, at least some do. You know, because it can get you teed off or it can get you a big head, you know. It is either too good or it is wrong. So you try to avoid getting caught up in that, well after winning the championship game against the raiders yeah we felt good because we beat a team that was tough, boy, those raiders were really good and we dealt with kansas city along the way, sso we played some good teams ad we won and we looked at our films, our last six games of the season we didnt beat ourselves, our offensive linemen didnt make mistakes, and our defense was the best kept secret about that game, charlie, the baltimore colt defense was touted as the best that ever played in the nfl, well here are our guys over here on the jets, we are best the best in the afl and nobody is talking about them and after about ten days leading up to the game being told we are 17 and 19point underdogs a guy at a dinner, hey, namath we are going to kick you guys butt and i said i have news for you we are going to win the game i guarantee you, it was simple, i mean, i felt that way, our teammates, and when coach you bank got on me about making that statement. Rose it was the restroom, wasnt at a restaurant. It was the Miami Springs villa, miami touchdown club, they were honoring. And had it in the paper and comes over to where you are and said what are you doing . They are going to use this against us and you said . Yeah, they are going to put these upton Bulletin Board and get fired up, they were over confident, i said, well, coach, if they need that, they are in trouble. And besides, i said, coach, it is your fault, i mean you are the one giving us this confidence, you are the one that told us we are going win, chucks, coach, if you didnt believe in us like you are making us feel i wouldnt have said that, and i look at him and he said get out of here, get out of here, joe. And it was a lot of fun, my offensive linemen certainly busted my chops because the ones that had to get in that pit and go the fighting, you see, but, no, they knew where i was coming from our team was confident but we knew we were facing a monster, we just out played them that day. We out played them. Rose and you come back to new york and you are the hero of heroes how was that . How was that . It is still good, it is still good, because all of us here still think of you as a new yorker. You know, charlie, yeah, yeah and it is a home of mine. This is home, i was told early on by one of the owners of the jets, mr. David a sonny, that new york . The greatest city in the world with the greatest people and he wanted me to get out there to know them, my rookie season he is saying you get throughout and you go ahead and you get to know this city. Thats right. And that was joyful. Yes, sir. Sure did. And i still do. Rose were you just being yourself or building and image . I was a kid, i was learning, no, i wasnt building an image, never, that was mr. Werblum brought to, he brought that to the American Football League and nbc and helping fill the league, mr. Werblum believed in the star system he was creating the star system in football which at the time, he treated everybody the same, the coaches, everybody was the same, we didnt have stars, per se, and didnt push the star system, mr. Werblan he did that with the new york jets. Rose broadway joe. Yeah. I am sure thankful. Rose but did a whole lot for the merger too, it promoted the merger like crazy. Oh, it did. Rose not only that, they would have had no inclination to merge. Well, you know, coach lombardis packers in the first two championship games they played well, and our, and the chiefs and the raiders lost but it got to be our turn and being in the afl you know when you lose two championship games and playing the third one, yeah, you know, it might have intensified the responsibility, but not the weight, i mean, that is on your shoulders, you want to win and then of course, lenny dossan the quarterback from the kansas city chiefs, he is happy to say at any time, the last game i ever played between afl and nfl, the chiefs beat the vikings in super bowl 4, so 3 and 4 we got level, yes. Rose and the coach on the sidelines, whose idea was that . Well, it was a few peoples idea, and my acceptance, certainly, they are beautiful coats and they did a beautiful job, every time i see a picture ilike that i think, all right, was the knee in a cast . Was it the torn ligaments in the shoulder . Was it the fractured rib . Because i wouldnt be dressing like that on a side lines if something wasnt broken or something wasnt wrong. So i get a kick out of seeing those pictures, but i do wonder, i say okay that was the leg that time, huh . Or that was the wrist that time, you know, it was something. Rose what do you remember best about your new york years . The people. Surviving, loneliness, getting here and not knowing, bumping into things that i didnt recognize. Being somewhere that i knew nothing about,ing with being in a bigger city than i ever could imagine. I used this to this day, i do believe that i am a gemini and there are a couple of sides to me, i do like my quiet time, i like my privacy but i dont like loneliness, before we won the super bowl it wasnt all fun and games here away from practice. I was a Football Player first. I needed to fulfill that engagement and fulfill that responsibility and that came not from coach bryant to start with but from home, from my High School Coaches and guys, i knew what i had to do to own up to my teammates. Rose it is great to have you. Thank you, sir, it is great to be here i appreciate you having me. Rose the great joe namath, back in a moment, stay with us. But you have an obligation as a journalist as well to tell truth and, in fact, to do your job, you have to earn the trust of the that reporter because someone like david crane kept me away from making mistakes of following false leads because i trusted they wouldnt lie to me. He wrote column for the new yorker magazine since 1993, he had a new piece in this weeks magazine i it is called outside the box, netflix and the future of television, it examines what ken called the revolution in television and the implications of streaming for Network Television. I am pleased, very pleased to have ken auletta back at this table, welcome, sir. Thank you, charlie. So television is undergoing because of the digital revolution, a revolution of its own . One of the things that interests me is the question, it is the, is the same thing going to happen to television as happened to music, newspapers, print . And that was one of the questions i began with and i thought i would use netflix as a vehicle to look at that story. And you come back with two answers. Yes and no. In many ways, television is being disrupted in a dramatic way and net 36 is a perfect example of that. People can watch it without watching ads, they watch it any time they want, they can watch as much as they want and they can watch it on any device they want. Rose right. So the set, tv set is not there. On the other hand. Rose or it might be. Or it might be, but i mean for instance 40 percent of the people who watch youtube, the Largest Tv Network in the world do it on mobile devices. Rose right. Which is extraordinary, and on the other hand, television, unlike when i wrote a book called three blind mice in 1991 and i said Network Television was in danger because it relied on a Single Source of revenue, what has happened to television subsequent to that is they figured out other revenue streams, net 36, for instance provides cbs with 250 million a year, fox, 250 idea a year, discovery 100 million a year, warner brothers, 350 million a year, that is totally a new platform so itunes and amazon and vios and all of those platforms are providing new revenue streams. The cable box owners are providing something called retransmission consent, 4 billion this year, that didnt exist in 91, so Network Television has figured out other ways of getting Additional Resources other than advertise intloog so when you say Network Television is dying, he said . It is not, it is vibrant, and in his world, it is vibrant, and i mean, ms. Les moonves, they have been number 110 of the last 11 years, on the other hand if you geese les moonves a truth serum and are you worried about the digital revolution and the fact television increasingly is being watched over the internet and platforms like netflix and children who are not watching ads and the fact that half of the people who have a cable box and a tv, dvr skip and watch, and taperecord shows, half of those people are not watching ads, they are skipping the ads, and you worry what is going to happen to your advertising model in the future. I think if you are honest he would tell you yes. Rose so what is going to happen to the advertising model . I think it will decline, i think advertising has happened in the Digital World where newspapers, the advertising dollars have fled newspapers and the advertising dollars have fled, you know, magazines, not as severely as newspapers, i think that will happen to the, they will go to the you tube and other places where they feel they can get peoples attention. Young people are not watching television the way their parents did. And they are used to skipping ads and not watching ads and used to watching on mobile devices whatever they want, and iif you are a Network Programmer and say at 10 00 oclock tonight we have this show, well, most people announce, particularly young people say i am not waiting. I am going to i a in power. Rose i will watch it on the tablet whenever i want to. Right. Rose so what happens to a netflix . Here is a company, that you point out, blockbuster could have bought half of it for 50 million. I think they might have been able to buy all of it. But. Rose but at the same time, reid will tell you or tell me that there is a reason they called it netflix and not dvd by mail. Thats right. I mean, he is an engineer, you start with that Silicon Valley, made a small fortune as an engineer, creating a software company. Reid hastings knew that the information was the future. Rose right. And he knew that the idea of going into a store and buying a vcr or a tape and seeing that all the tape, the shelves are all gone off the top ten of 20 movies that month and, therefore, at some point they are going to go to online and they are going to go to dvds and not tapes and after dvds they are going to go online. He knew that, which is why as you point out, he called it netflix. Rose he let the technology to catch up. He had to wait for technology to catch up, and the technology, think about streaming that data or the video over a broadband pipe, broadband pipe had to be broader, and then there is ariel, what is ariel. Aerio, that is this year, barry diller put some money in, the former broadcast executive barry diller, this engineer had come up with something called aerial which said i will create little antennas and i will capture the signals from cbs and nbc and all the broadcast networks and for ten to 12 a month i will store them on a server and i will stream them to your devices and you can watch Network Television for that little amount of money, you can skip your cable bill, you dont have to pay an average of 75 a month for cable, you can pay ten to 12. Rose but only what is over the air. Only what is over the air but most people do watch broadcast, not exclusively you cant get espn and cnn. Rose those are cable products. Those are cable products but get the major broadcast products and you can reduce your costs and if you want to have some additional things you can do aerial for ten or 12 and netflix or 8 and hbo you can do that for 15 but nevertheless you are going to spend half of what you are going to spend of your cable bill is the argument. He has won in three courts so far, they say it is no different if you have an antenna on your roof, which you are legally allowed to do and capture broadcast signals is what he is doing and it is before the supreme court. Rose a big decision. A huge decision. Rose so what are the applications for it other than for people the specifics of they are involved in the lawsuit . What are the implications this. Well, if aerial is not what he calls less moonves is, which is theft, who have joined in fighting it new Orleans Saints not just broadcast but cable have joined in fighting it they call it theft but in fact it is free over the air and it is legal then you say, well, cable networks, which are now paying 4 billion a year, which is the right to reair the broadcast they wont air that money, why should i pay you 4 billion when aerio is taking it for free, netflix will say why am i paying you a license fee of x dollars when they have the same programs and not paying for it so i want to reduce my license fee from cbs a, nbc, abc, fox, i dont want to be paying you 4 billion, the 4 billion. So it has this it throws everything up in the air potentially. Rose and most people believe that aerio will win because simply they have won at every court so far . I dont know if you believe in copyright and you think about the implications of this, cbs has a show i happen to think a wonderful show called the good wife,. Rose . It is on sunday nights and one of the things they smartly did was they gave it to netflix so it built up an audience like breaking bad and built up an audience for breaking bad, so they pay roughly four to 5 million an hour for that show. How is cbs going to be able to afford four to 5 million of Quality Television if, in fact, if they are right that aerio is pirating their programming and stealing their programming . So that would affect the consumer, of course you wouldnt be able to afford that kind of production value. Rose at the same time, john malone, having done it in europe, is now trying to put together, you know, the largest cable conglomerate in the world. Because in his own words it is not Cable Television, it is broadband. Well, there are two arguments, two questions there, charlie, one is that malone like a lot of you have these giant, giants battling and yet embracing at the same time, so the broadcast guys want to get more from the cable system, more retransmission consent dollars from them, cable guys want to pay them less. Then you have the cable networks, you know, espn, which want to receive more money from cable, cable wants to pay them less. And then you have netflix which wants knob there and they are on, you know, the broadband wire and very reliant on them and helped build that wire but all competing so john malone comes in and he is a power player and he said cable is too weak today, so we have to do a couple of things. We have to consolidate so let us own a piece of Charlie Communications one of the seventh largest Cable Company, why dont we buy time warner and now time warner is in play and others are circling, cox is circling, comcast is circling as well as charter. He is saying if cable con some dates instead of being able to or nine Cable Systems around the country combined we would have a lot more leverage over the broadcasters and over the espn in order to hold down some of the costs, the second thing. Rose to pipe into the home. Then that is the second question, the second question becomes, if we increasingly have small margins and own a cable box and have margins are shrinking because we are beige so much to air these programs, why dont we get out of the Program Business . What if we just concentrate on broadband, the Internet Connection in the house . And if we do that, our proper margin is 80, 90 percent on that, and maybe we can start charging like electricity like power exeant companies do in media usage so netflix says oh, my god if they put a meter on me, that is going to, since a third of all the traffic at night is netflix, then that is going to jack up their price, they cant charge 8 a month anymore, this he have to raise their prices or what if instead of charging netflix they charge the consumer using at the time flicks that the causes turmoil what it does is give more power to cable which is what john malones end game is. Rose so where is jeff bezos and apple . Jeff bezos and apple and microsoft and netflix are together in opposition to that. They want to as sure something called Net Neutrality continues, and that everyone is treated the same and the same price, if they get if they use the internet. And that you dont have what you have with the cellphone which is data charges. And so far, the court has ruled that the fcc imposition of Net Neutrality was wrong, and that is also going to be fought in the court. Rose you say now the golden age of television is upon us. Right. Rose they talk about breaking bad as an example of that. Is it . I think so. And i think you know, think about it. Kevin spacey said this in a speech at the ed borrow edinborough in august but several people i quoted in the piece i wrote in the new yorker say it as well, which is that if you where a writer and if you write, say, the good wife, each hour of drama on broadcast television or Cable Television is essentially 40 minutes of programming and 20 minutes of ads and promotion. So your script is really a 40 minute script if you write for an hour of in netflix or hbo you have written 60 minutes, the entire, so it is much more attractive, a, b, you are writing, if you are writing house of cards for netflix, you are writing a 13 hour ed hastings wrote to me a book,. Rose suppose you are cocacola what are you going to do . How are you going to promote your product. You have to sell your product. You have several things. One, a challenge for advertisers is to do ads that are intiesing to watch which is, enticing which is why the super bowl is a good model. The ads on the super bowl people watch because generally speaking they are good, they are good, and so sports ads tend to be better. So advertisers have to up their game a little bit and do better ads, a, b, you have to think about different forms of advertising. And, c, some of them are talking about figuring out ways that we can create programming ourselves and be identified with programs. Rose which it used to be. Playhouse. Rose reagan did ge theatre, whatever it was. And there was some wonderful. That was golden age of television as well. Then the question becomes, how do you do it, it is one of the problems that cellphones have, how do you create ads that dont feel like an interruption and if the ad is good it may not feel like an interruption. If the ad is information it wont feel like information. Which is one of the things that google has been brilliant about. People who do a search on google, those ads are informational, or what google is doing with true value, you know, if you watch youtube, you literally can click if you dont want to watch the ad you dont have to watch it, you click the value button and watch it but often that is informational to you so it works but i dont see netflix for instance doing the playhouse brought to you. But i do see them raising prices at some point. It is said that in the digital revolution advertisers know now where the people are that are likely to buy their products so they find a different way to go at them. Absolutely. So, you know, then you are going to get, you are going to bump into other issues like privacy and how much information of the advertising is going to have allowed to have access to. One of the advantages that netflix has, for instance, and hbo doesnt have, hbo has many advantages over netflix but one of the disadvantages, they dont have access to your credit card and personal information. The Cable Company that you subscribe to, hbo through has that. Netflix has direct access, apple has direct access. To your credit card, amazon has direct access, that personal information becomes very valuable. Particularly valuable to an advertiser one day and he will want to sell it. Can they give it . Can they give it . And that is a question that is going to be there. But if you have addressable advertising and you are watching lets say on your ipad, you know, and you are watching manager and you click and you buy manager and you now are in touch with that advertising, that advertiser has a direct link to you and at one point that advertiser is going to know that you are an owner of a mercedes or a chevy or whatever kind of car you are and they will be able to target their ads to you. Rose or a ford pickup. With el that is you. Rose it didnt do well. For the graduate so what is this going to do for people who do what i do . They provide content . I mean is this all good for me . Yes and no. Rose or should i you are going to be okay, you will live long enough to see the end of it. But it is jump ball here, we dont know the answer to that. There is a classic argument that goes on for decades who is king is it content, . Is it distribution . Is it technology is it the consumer . Increasingly you would say the consumer is the king, because Technology Empowers them to make the choices. Rose right. What talent they want to watch, whether they want to pay for something if they dont pay then the talent is going to take it to the next on the other hand, every time i start to think, well, Reid Hastings said this to me, i is a did consumer is king, if the consumer is really the king, ken, why is it we cant watch a movie on television the same day it appears in the movie theatre . Rose good point. Which is what we would like but we cant. Rose but we might be able to . Well, at that point then you have disrupted the movie but it is the same argument in terms of i think football has and sports have you talk to football owners what they worry most about is people can see it in such an extraordinary way now on Big Screen Television at home, you know, how do you get them to the stadium . Wait until you say 4 k, the 4 k pictures are extraordinary, i mean, they are so crystal clear, the colors are so vivid, it is just extraordinary and i actually was Adobe Systems in silicon centrally when doing the netflix reporting and i looked at 3d without glasses on television. Rose how was it . I thought it was pretty good, some people say when you turn your head, you cant see it but i thought it was pretty vivid, i mean, that and the 4 k was pretty vivid so the technology is change background 4 k television is power, 56,000, who is going to buy it . I remember years ago saying ever is going to have a flat screen, and everyone is going to have a flat screen and fill up their wall and i was thinking, what house has he been in . What apartment house has he been in . Who is this guy . Rose so two things i wanted to talk to you about before i close, what is the next big idea in the rest of the world you are covering in terms of Silicon Valley . I mean, what is what is coming beyond video . Well, charlie, i mean. Rose data, the whole here is the talk. I mean the talk is obviously mobile, mobile, mobile and the fact that, you know, facebook, i mean, facebook today what do you think of the facebook earnings . Well, they are figuring out how to do advertising on mobile, the world is moving to mobile. Rose right. The problem becomes, how do you do advertising on mobile in it doesnt work. You know, we interrupt your phone call or your email to bring you this message. No way. So they have to figure out how to do advertising that is effective and not interrupt if the. Facebook is doing a much better job of that, and they relate to the game of mobile game, google is not, google was early. Rose well, they just sold note row la by the way. But have three quarters share of a great operating system, android is unbelievable and i was just on bloomberg and one of the wall street analysts said well you know, they missed by a tenth of a percent or so our projection of how they would grow and i said what a ridiculous statement that, is i mean, you know who cares what the analyst says about a quarter performance if you look at the platforms they are on, the mobile world, to pick up our your theme the world is moving on that and the question is can advertising figure out a way to advertise so you can make the kind of money you made with Television Revenue ads. And if they can, that is a big deal. Big data was a big thing. People were talking about over the last several years and now they are talking about the internet of things and rose exactly. And who knows, i mean some of this is, you know i mean having covered this world for a long time now, i am always amazed at how people get caught up and enthusiastic about things and then whatever happens. Rose we dont know what happened with the consumer electronic show. The internet is the thing. Rose what does that mean . It means. Rose what does that mean . You watch a little band the google glasses. Rose . Rose brought the first one on television right here. It was really ugly. Rose yes, i know it is. Which is now why they are talking about designer eyeglasses because nobody is going to wear them. Rose exactly right. Here is a little thing i saw this week in the paper, the Washington Post is hiring, hiring, what does that mean, if anything . Well, you know, i hope it means something good. But it might mean Something Else or what does it mean. It means jeff bezos is saying, has given martin barohn, who sent out a post to the staff, i believe that if we invest and we put more meat in the stew that more people will read the Washington Post. And so they are hiring reporters. Rose do you believe that . Well, the register did this years ago and they announce adlai yaw of many of those people, patch which is owned by aol, a local news just sold and laying off people. They are the largest hirer of journalist twos years ago. So how do the Huffington Post and daily beast doing . Well, the daily beast. Two different answers . Yes two different answers, daily beast is not doing as well, tina brown left that and not making money there. It is a good Digital Product but. Rose it is part of aol. The Huffington Post is expanding. Rose internationally. Internationally, and they have a lot of traffic, but then they are challenged by new ups like buzz feed. And. Whether these are sustainable journalistic models is a big question. I hope they are. And i hope that the Washington Post will succeed in expanding and the New York Times will succeed with its Digital Edition and be able to generate real income, but if you look at what has happened to newspapers and if you look what has happened to digital newspapers, although there are a proliferation of them, there is not a lot of evidence that they are making a lot of money and so, therefore, you look at other models, you look at what, 250 million. Rose it is going to be an investigative thing, primarily, isnt it . No. I have read where also talking about sports in the theatre and other things. Rose ben law is working for him. Yes, yes this is a guy that. With snowden. Rose before the manchester but the assumption is that that is a nonprofit, the way to the republic is a nonprofit, and that is another model maybe that we have to look at in the future. I mean the guardian is a nonprofit newspaper. Rose i know, yes. And a damned good one. And a damned good one. Rose ken auletta, annals of communication, the new yorker magazine. Back in a moment, stay with us. You got something on your, on you right here. Oops. I did it again. Oh. Oh pick up your pants, sweet boy, take those pants off that is going to stain. Greek yogurt, fuel your pleasure. Rose when millions tune in to watch the super bowl half will do it just for the commercials the expense of commercial ad time during the event is staggering this year 30 second spots cost 4 million, some advertisers are releasing their ads ahead of the game through social media to generate buzz and to reach more viewers, joining me now is abbey klaasen, the associate publisher of advertising age magazine and very happy to have her here. Thank you, charlie. Give me the sense of how it is building up this year. Thats right. In terms of the excitement from the Advertising Community about the super bowl. Well, every career when you dont think it can get bigger it gets bigger and it is funny because i think it has everything to do with what mr. Auletta was talking about, you know, the trends that are happening in television, you know, fewer pitch watching live, fewer people watching any one particular channel at any given time you have all of this fragmentation so the super bowl is the one place you can reach about 110 Million People at the same time watching the same thing, watching it live and what is more watching it as much for the commercial dishals as the actual main event. Rose do advertisers therefore all of a sudden because it is so costly because so many people are watching they are willing to spend more dollars and extend more iq and more kraft 50 and everything. Absolutely, absolutely, you talked about sort of the leadup to the super bowl and so we have seen this the last several years. Right. Rose where they will release their spots early, they will try to build up buzz before the game and, you know, i guess advertise that 4 idea event meant 30 seconds of airtime. Rose we are all sucker because we are talking about it right now. We are, so it is interesting further to the idea of how will advertisers succeed in the future . One of the solutions is, frankly, to produce better ads, right . And the super bowl. Rose . Thats exactly right and one of the hallmarks of the super bowl is when everyone has their a game, you know, they are producing ads, they are very expensively produced ads, generally, you know, they are the ads that marketers spend a lot of time thinking about, how will these be entertaining the flip side of that, they are supposed to sell and i think sometimes they spend too much time thinking about how do we entertain with this ad and fore sake the actual, you know, whole point of this expensive buy is we have a product. And they are selling products but is the effort during the super bowl to sell Something Else to make you feel good. Yes, absolutely. Rose what is the point of advertising . I know it is to sell products. Thats right. Rose . Rose but how have they decided the best way to sell products is . Well, it depends on what your goal is,. Right so we have seen some advertisers come into the super bowl with, say, a new product or i would point you to soda stream this year, soda stream, you know, is at home, soda makers, you know, most of my friend in new york know what this is, i am not sure if all of my friend in other parts of the country necessarily know what it is, but this is a way for them to introduce this product which is still relatively new and sort of a new concept to the rest of america, so there is that. You might have an existing marketer who wants to come and introduce or the new program, i think back to 2009 when hyundai, you remember, hyundai which always has been sort of a lower tier auto manufacturer, sort of a Bad Reputation until recent years, and they came out in the 2009 super bowl and introduced the assurance program, which was a ten year warranty, changed their business. Rose wow. And with that super bowl buy, suddenly, everybodie in the country knew what this thing was, so, you know, for a certain marketers it has a very distinct kind of selling purpose, for other marketers budweiser, you look at budweiser who doesnt know what budweiser is, they are not generating awareness. Instead what they are trying to do is really get you to feel something, get you to feel sort of an affinity for the brand, i mean it is really, really soft metrics. Rose and how about cocacola and pepsicola and all of those . It is one of those things where it is the same thing, they dont have an awareness problem what they are trying to do with the advertising is convey sort of an emotional response get get people to feel something, an affinity for the brand, i do think there is it is something at play which is if you are not there and your competitor is, there you know, i think they get nervous, you know there is one year pepsi pulled out of the super bowl entirely, i he that was 2010, and, you know, they had actually a pretty bad year, they pulled back on tv advertising. So you know they gave up some really prime real estate in the game, too you have anheuser busch, which is always one of the games larger advertisers, and has been traditionally, and they are the exclusive beer advertiser for that rose lets take a look. The first one we will see, let me get my cards here to set this up this is the budweiser commercial you know because of puppies and horses i love. Thats right, it is so cute. And this is sort of a friendship story. Right. Between a golden retriever puppy and collide dale, it is essentially the sequel to the brotherhood ad that aired last year which because story of friend ship between a no horse trainer and the this time he was next door to a puppy breeder and one of the little golden retriever puppies develops in Kinetic Concepts ship with these horses and i actually was gone set for this particular ad, which we did a behind the scenes special, budweiser was on the set and let us check it out and they used eight different golden retriever pun piss so they could swap them out when they got tired, there were only ten weeks old and trained them in 16 days to do all the stuff they wanted them to do, it was really incredible. Rose all right. Roll the tape. Only know you love it when you let her go. Only know when he is feeling low. Only hit the row when you are missing home. Only know you love her when you let her go. And you let her go. Let her go. Will you let her go. Eat your heart out. That is so cute. That sat 60second spot, we are seeing more of those. It is double the typical, entertaining time, 8 million right there. Rose thats right. That you just saw. You saw it and yes. But, you know, it tells a story. Rose okay. The next one is a cheer owes, cheerios commercial, here it is. Hey, gracie. You know how our family has daddy and mommy. And me thats right. Pretty soon we are going to have a baby brother. And . A puppy. Deal. For cheerios i think this is an example of a marketer who really is seizing the opportunity of the super bowl to take advantage of, this family started in a cheerios ad this past year, and when they posted it on youtube, it actually prompted some racist comments, i think it was a very small number of folks who were doing that, but it created some, you know, buzz because of that. General mills instead of sort of kowtowing to that decided we are going to continue to air this ad, we are going stand behind is, we think it is a beautiful depiction of a modern family. Rose right. And they decided to put it in the super bowl and i think it will do really well because the majority of folks who saw the first ad loved it. Rose the next one is the volkswagen commercial, here it is. 100,000 miles. It is a big deal. What if i told you every time a volkswagen hits 100,000 miles a german engineer gets his wings . I hate these wingy thingies. Volkswagen has the most vehicles on the rode with over 100,000 miles. That is the power of german engineering. That is probably the most overt sell you will see during the super bowl. Rose right at it. Right at it, exactly. Rose 100,000 we do the most. We do the most. Exactly. Rose if you look at the total amount of money spent on ads in this super bowl, what would it total . Lets see 30 seconds for 4 million, is about 608, 30 second spots in the game, i cant do math that fast, charlie. It is an awful lot of money, exactly, exactly. Rose and probably need every dollar of it to pay the nfl. Thats right, exactly. It is not cheap and 4 million is just the cost of airtime. If you are going to rose make a good one. Make a good one and you are going to promote it before the game and after the game you are probably talking closer to six, 8 million all in. Rose thank you, abbey. Thank you. Rose good to see you. Thank you for joining us. See you next time. Captioning sponsored by Rose Communications captioned by Media Access Group at wgbh access. Wgbh. Org. This is nightly business report. Brought to you in part, the street. Com, founded by jim cramer, an independent source for stokt analysis. Home to his multimillion dollar portfolio. Street. Com street. Com npr. Google and amazon, the number one online retair had the busiest day of the season. 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