00:00Let's talk travel. The worst of the TSA chaos may be easing, but wait times remain uneven, especially at major
00:07hubs like Newark and JFK.
00:09The question now is whether that surge in demand for services like Clear can last.
00:15For more, we're joined by Karen Seidman-Becker, chairman and CEO of Clear.
00:20And I say services like Clear, but is there anything else like Clear? I don't think, other than TSA PreCheck.
00:26Broadly speaking, I don't think so. I think we're one of a kind.
00:29So you must have gotten a big boost from your initial agreement with American Express.
00:34At least everybody in this office started to use Clear when that came through.
00:38And I know you've renewed that. How much have you gained from the TSA issues that we've had during this
00:45government, partial government shutdown?
00:47I think what you saw in this government shutdown is that travel is hard and getting harder and that travelers
00:52want solutions.
00:54And so we introduced a lot of new products right ahead of this, I would say coincidentally, that got a
01:00lot of awareness from this shutdown, whether it be our relaunched mobile app and the home-to-gate capabilities, whether
01:05it be our beloved e-gates, which we're still rolling out and are in 40 airports today and are totally
01:09magical,
01:10or whether it be our concierge and pre-check products, we have a significant percentage of the pre-check enrollment
01:16market.
01:17And I think what's important, travelers want predictable, frictionless experiences. This was anything but.
01:23So did you get a lot of big boosts to subscriptions over this period then?
01:26I think people's love of Clear grew significantly during this time period.
01:31Surely you see the numbers. Don't you see the numbers?
01:33Don't they bring them to your desk every day?
01:35I do see the numbers. I do see the numbers. And I think we reported a very strong fourth quarter
01:41before this happened.
01:43And I think the strength that we saw, and broadly speaking, the need to have a secure identity platform, both
01:50for travel, but also we're seeing growth, significant growth.
01:53We called it escape velocity in the last quarter in our enterprise business.
01:57So workforce security and keeping North Koreans out of critical infrastructure, health care and fighting fraud, waste and abuse and
02:04Medicare and other areas.
02:05This is a really massively important time to be a secure identity platform and to be a trusted brand.
02:11And trust is massively important.
02:13And you're knocking down, it seems like, barriers left and right.
02:17I just heard that some people from other countries who previously couldn't use Clear because they don't have a U
02:24.S. ID or passport can now use Clear.
02:28That is true. So 42 visa waiver countries can now enroll in Clear.
02:32So we're seeing a lot of Canadians, U.K., South Koreans, Japanese.
02:36And this is all ahead of the World Cup.
02:38And they can do it all on their mobile phone with their passport.
02:41And so this is a really transformational time in travel.
02:45And I also think that this administration has been really focused on having the U.S. lead in travel and
02:52innovation because today we don't.
02:54Singapore, London, Tokyo, they all have better travel experiences than we do in the U.S.
02:59And being that we are a leader in innovation, we should lead in travel experiences and security.
03:04What do you think about privatizing the TSA?
03:07Because in my experience, and it's obviously only anecdotal, Clear brings me straight through to the X-ray machine.
03:15And then I'm stuck waiting forever in a lot of instances, right?
03:21If we privatize the TSA, does that part of the equation get even better?
03:26So certainly in the budget that was released last week, the Trump administration talked about privatization.
03:30It is something that we advocate very strongly for.
03:34The power of public-private partnership is really important.
03:37These e-gates, we were able to roll out, or we are rolling out, at no cost to taxpayers.
03:42So we've got to drive innovation.
03:43And we've got to let the private sector do what they do well, which is innovation and procurement and speed
03:51and customer experience,
03:52whereas the government really is great at intelligence and analysis.
03:55And so I think the two together and adding more capital, to your point, to the physical screening piece, to
04:02the home-to-gate experience is really important.
04:05And I think there's so much more that we can be doing there.
04:08And I think privatization and public—it's not just privatization, because you see Kansas City and San Francisco,
04:15places where you do have stronger public-private partnerships, and they functioned much better during the shutdown.
04:21You can't let U.S. Travelers be a political football.
04:23So I do think—I'd call it public-private partnership.
04:26What are conversations with airports like when you want to get clear-added?
04:30What do they need to see?
04:31What does it take to convince them?
04:33Is it money?
04:34Is it spending?
04:34What is it to get it rolled out in more places?
04:37So innovation's about bringing people what they did not know they wanted,
04:40and for a long time people didn't know they wanted biometrics.
04:43Today we cover about 75 percent of the U.S. network,
04:46so we're trying really hard to get those last airports on board.
04:49You know, I think that they need to see the customer experience in other markets.
04:54I think they need to see the revenue share in other markets,
04:57because clear this year we'll pay over $130 million to our airport partners
05:01that they can use for infrastructure, which is badly needed, or other investments that they want.
05:05And so each airport is different, and we are working real hard on each one,
05:10because customers want it, security is enhanced, efficiency is enhanced.
05:14You just saw that.
05:15It's a no-brainer at this point.
05:17By the way, I went for recently, I can't remember what it was,
05:19like a blood test or something at a hospital here in New York,
05:22and I was surprised to hear them ask me if I had clear,
05:25and then I was just whisked straight through to the doctor's office,
05:30rather than, you know, going through all the rigmarole at the security checkpoint at the front desk.
05:35How much are you expanding beyond airports?
05:38How much of your business is that?
05:39We think health care is an enormous opportunity.
05:42You look at compliance, privacy, security, and customer experience,
05:45they have their own challenges and interoperability.
05:49So killing the clipboard and being able to enroll once and use it everywhere for check-in,
05:53for your electronic health record, those are your records.
05:56You should be able to share them with anybody instantly, just like you can wire money.
06:00And then also payment.
06:02And so health care is a huge opportunity.
06:05We are partnered at the hospital level.
06:07We're partnered at the EPIC and the EHR level.
06:10We're partnered at the government level.
06:12Rural health transformation.
06:13It's a huge opportunity.
06:15How are you thinking about pricing?
06:17Clear plus, $209 a year.
06:20Can you move that up?
06:21Are people willing to pay it?
06:22How do you think about different tiers?
06:25How is pricing existing in America when such a big conversation is happening right now
06:29that the consumer is stretched?
06:30So our average revenue per user is less than $209 because there's lots of different ways that people can enroll.
06:38And so the way we think about driving ARPU or pricing is really through new services.
06:43And so we have taken pricing over the past few years because the service has massively improved.
06:49I believe that pricing is about bringing consumers and partners value.
06:52And as we've continued to drive the value, you can continue to drive the pricing.
06:56So things like concierge and other partnerships really bring value to our customers and then drive our pricing as well.
07:04I have a viewer writing in and says, when can we get clear of the JetBlue JFK terminal?
07:09And by the way, I wonder if naming and shaming works, right?
07:12Because there's supposed to be a cutting-edge airline, right?
07:15And they've got this whole new terminal.
07:17So we agree.
07:18We love Terminal 5.
07:20And I remain very hopeful.
07:22Indefatigable is one of our core values, persistent and tireless.
07:25And so we love New York.
07:27JetBlue is a New York company.
07:28And I agree.
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