☕️ Good Thursday morning from L.A. ... 26 days until midterms.
- Both parties' final pitches play on fear, the WashPost points out.
1 big thing: The battle for the future of TV
The race to own the future of TV is intensifying, with mobile and streaming video companies looking to build or expand video services that will launch by next year, Axios' Sara Fischer reports.
- Why it matters: Billions of dollars are at stake for whichever company can win the attention of younger generations, who are abandoning traditional TV in droves.
- The scramble is so urgent that five new initiatives were announced yesterday within hours of each other:
By the numbers: Over 60% of young adults in the U.S. say the primary way they watch television now is via streaming services on the internet, according to a Pew Research Center survey.
- Only 31% say they mostly watch via a cable or satellite subscription.
Be smart: Traditional TV is not being replaced by one medium, but by a combination of video services across the internet, most of which can be separated into two buckets: mobile video and subscription video on demand (SVOD).
- Mobile video is typically shot vertically and tends to be shorter in length (usually between two to 10 minutes), and engages viewers actively, though methods like tap or swipe scene navigation.
- Subscription video is filmed horizontally and is meant to be consumed passively on bigger screen sizes (like TVs or tablets). It's typically longer than just a few minutes, usually somewhere around 25 minutes per episode.
Quibi (short for "quick bites") was revealed yesterday at Vanity Fair's New Establishment Summit as the name of the highly-anticipated mobile video startup by Jeffrey Katzenberg and Meg Whitman.
- AT&T announced yesterday that it will launch a new direct-to-consumer streaming service in late 2019, based around HBO programming.
The takeaway: None of these companies that are looking to own the future of television are TV networks, and only a few are telecom companies. Technology companies are mostly the ones looking to upend the traditional TV landscape.
2. 🌊 Game change: Dems thrive in money chase
"Democrats have extended lessons learned from Bernie Sanders’ presidential campaign, ... harnessing hundreds of thousands of energized small donors nationwide and innovations in digital fundraising to shatter fund-raising records," the L.A. Times' Evan Halper reports:
- Why it matters: "Republican strategists worry the cash could put even some supposedly safe seats into play."
- A GOP consultant: "Democrats are raising money hand over fist ... You don’t see that in polls on which voters are showing interest in the campaign, but you’ll feel it down the stretch. It enables the Democrats to expand the playing field."
The big picture: "American politics hasn’t previously seen this level of fundraising engagement from small donors."
- "The amount of money pouring into the midterm election far exceeds what small donors invested in the 2016 presidential race."
The twist: "The money is going to candidates whom donors often know little about. But they trust the progressive groups raising the funds."
- "The internet has allowed those groups to connect donors with candidates in a more efficient, less expensive manner than previous small-dollar fundraising that centered on direct-mail or email campaigns."
- Sarah Bryner, research director at the Center for Responsive Politics said liberal donors "look at a Congress that is so gerrymandered and hard to make change in, and they want someone to tell them how to use their pocketbook in a targeted way."
3. How employers are changing the future of student debt
With student debt stopping a huge swath of Americans from buying starter homes, some big employers are starting assistance programs that experts say could become as ubiquitous as 401(k)s or health care, Axios' Erica Pandey reports.
Right now only about 4% of companies offer student debt assistance. But in today's tight labor market, they're finding that the perk attracts young talent.
- Fidelity Investments was one of the first companies to help pay down employees’ student debt when it started its plan in 2015. The company offers employees $10,000 over five years, paid out monthly.
- Hewlett-Packard Enterprises is one of 25 companies that has contracted Fidelity to help implement its program. Fidelity works as a record-keeper for HP employees who are taking company money to pay down debt.
- Aetna, which launched its assistance program in January 2017, also offers employees $10,000 over five years. The company gives $5,000 over five years to its part-timers.
4. Michael charges into Southeast
"The most powerful hurricane on record to hit Florida’s Panhandle left wide destruction and at least two people dead and wasn’t nearly finished ... as it crossed Georgia, now as a tropical storm, toward the Carolinas, ... still reeling from epic flooding by Hurricane Florence," AP reports.
Axios science editor Andrew Freedman tells me:
- This was the third-most intense hurricane on record in the continental U.S., based on atmospheric pressure — stronger than Andrew and Katrina.
- This was the first Cat 3 to hit Georgia in 120 years, and it went through another state first!
- Multiple experienced storm chasers are unable to articulate the scale of the damage in and around Panama City, Fla., near where the core of Michael came ashore.
- One described it as akin to a nuclear bomb, and he survived Super Typhoon Haiyan in the Philippines, which was bad.
- We may find that at daybreak it becomes clear that we have another Homestead situation on our hands (I’m dating myself here, but that community was decimated by Andrew in 1992).
5. U.S. intel points to Saudis
U.S. intelligence intercepts show that the crown prince of Saudi Arabia, Mohammed bin Salman, ordered an operation to lure Washington Post columnist Jamal Khashoggi back to Saudi Arabia from his home in Virginia and then detain him," reports The Post's Shane Harris.
- "The intelligence, described by U.S. officials familiar with it, is another piece of evidence implicating the Saudi regime in Khashoggi’s disappearance last week after he entered the Saudi Consulate in Istanbul."
N.Y. Times: "A Turkish newspaper close to the government has published a list of 15 men it says formed a hit squad of Saudi government agents the Turks suspect of killing and dismembering [Khashoggi] inside the Saudi Consulate in Istanbul."
- "Turkish officials have cited confidential intelligence to support their contention that Mr. Khashoggi is dead, but have declined to disclose that evidence."
6. California now world's fifth biggest economy
"California is ... now the fifth largest economy in the world after surpassing the United Kingdom in total output this year," the N.Y. Times' Adam Nagourney, Natalie Kitroeff and Tim Arango write from L.A.:
- "It has the highest concentration of billionaires in the country."
- But "California’s poverty rate, at 19 percent, is the highest of any state."
The Golden State "may be facing a financial reckoning at the very moment that Jerry Brown is stepping down as governor: a possible recession coinciding with deepening concerns about its fiscal stability."
- "[B]y nearly every account, a national recession is overdue. Another economic downturn could be especially devastating to this state, with a tax system heavily reliant on high-income wage earners."
- "The revamp of the tax code enacted by Congress could prove damaging to California if wealthy people start fleeing to lower-tax states."
Why it matters: "California is now on the verge of putting one of the world’s largest economies in the hands of a relatively untested governor."
- Brown's "potential successors — Gavin Newsom, the Democratic lieutenant governor, and John Cox, a Republican business executive — have significantly less experience."
N.Y. Times Quote of the Day ... John Cox, California's Republican candidate for governor:
- "The economy has grown. And it has obviously helped people at the top. And everyone is working, the unemployment rate is pretty low. But people can’t make it here."
7. Utility stocks suddenly in fashion
The Dow industrials lost 832 points (3%), the third-worst point decline in history.
- All 30 Dow stocks were in the red, but the selling was led by tech.
- The decline "raises fresh concern about the health of the nine-year-old bull market," per The Wall Street Journal.
Be smart: "Investors turned to shares deemed likely to do better in tougher economic times, such as utilities companies. That rotation out of tech and other growth stocks has been sparked in part by the recent jump in government bond yields and the Federal Reserve’s interest rate increases."
- When asked about the decline, President Trump said: "I think the Fed is making a mistake. They are so tight. I think the Fed has gone crazy."
8. Treat yourself
The best-read story in the West Wing yesterday, by far, was Olivia Nuzzi's instant classic for New York Magazine, "My Private Oval Office Press Conference With Donald Trump, Mike Pence, John Kelly, and Mike Pompeo":
- Jonathan Swan points out that it’s a perfect encapsulation of what it’s like to work for Trump. Olivia lets the scene roll, with no interjections. It captures his diversions, the constant stream of people into the room, the clamoring to laugh at his jokes.
- The final scene — Trump chief of staff John Kelly and Pence chief of staff Nick Ayers hugging — is almost too perfect, given that everyone knows Trump met with Ayers in the White House residence and discussed the chief job with him.
9. What we're listening to
N.Y. Times Op-Ed columnist David Leonhardt tells me about "The Argument," a new weekly opinion podcast that debuts today, featuring a trio of Times columnists: David, Ross Douthat and Michelle Goldberg.
- "Ross, Michelle and I ... have fundamental political disagreements. ... Ross is a religious conservative — pro-life, worried about immigration and sympathetic to today’s populist movements. Michelle is a proud progressive — despairing about Trump’s America and yet hopeful because of the strongly left leanings of young people. I’m left of center, but right of many liberals."
- "I hear one message above all from readers: They don’t want to live in a political bubble, and they’re worried they are indeed doing so. They want to hear opposing views. They want to understand them and grapple with them and take them on. That’s the mission of The Argument."
10. 1 fun thing: Kanye vs. Taylor
Kanye West, who is to have lunch with President Trump and see Jared Kushner today, and Taylor Swift have pulled opposing political 180s, seemingly swapping factions of their fanbases, USA Today writes.
- "Call it an unforeseen effect of the Donald Trump era that Swift and West have become representatives of America’s political divide."
- "From associating with alt-right figures to sharing his questionable takes on slavery, West’s political turnaround has thrilled conservatives ... while rendering him unrecognizable to fans that connected with his raps from a decade ago."
As the L.A. Times puts it: An urban rapper talks up Trump, "while a country-rooted pop star advises Middle America to vote blue."