00:00I am here with Derek Chang. He is the CEO of Liberty Media, also sitting on the board of the
00:05oversight, Liberty Media's subsidiary that oversees Live Nation. Derek, thank you so much
00:11for being here. Really appreciate it. Lisa, thanks for having me. So I want to start with the idea
00:14that everyone here is talking about scale, getting enough scale, merging up, particularly in the
00:19media space. You moved in the opposite direction last year, breaking up into a host of different
00:24entities. Can you talk about why you decided to do that? Well, I think if you look at Liberty Media
00:29over its history, it's had a history of sort of expansion, contraction. You know, we kind of go
00:36with the flow a little bit, depending on what the circumstances are and what the market is, you
00:41know, asking for and what we think that we should be doing for our shareholders. So I don't think in
00:45this particular moment it was a specific strategy of we're ultimately going on a trail of just sort
00:52of getting smaller. It was clarifying and simplifying the structures. And so delivering to shareholders
00:58sort of what assets they want in what places at this particular moment. But, you know, over time,
01:04we have had tracking stocks. We have spun out companies. And now we're sort of back to a more
01:09simplified structure. And it's really to provide that clarity for shareholders. So you oversee your
01:15two main properties at Liberty Media are Formula One and MotoGP, which is relatively new in the U.S.,
01:21very big in Europe and Southeast Asia. I'm just wondering how you're thinking about a media strategy.
01:27You just signed this five-year deal with Apple in terms of streaming rights. Is it the same between
01:33streaming and legacy cable networks? Is it sort of all the same at this point when it comes to
01:39sports licensing? Well, I think it still depends on market, on what markets you're actually in. And so
01:45in a lot of markets like the U.S. at this point, the streamers have a, you know, you just
01:50spoke
01:50about scale, a lot of scale. And I think that historically people have said, oh, you got to be
01:55on a broadcast network. Otherwise, you're not going to have the reach. I don't think that's true
01:59anymore. And I think the deal that we did with Apple basically has shown that that is, you know,
02:05for us, Apple has, we've seen no real drop off in terms of viewership. And in fact, engagement overall
02:11is higher than it was before in the early sort of going here, the first three or four races that
02:17we've had this year. And I think what that speaks to is, is streaming platforms certainly in U.S.
02:22have reached a level of maturity and even beyond, you'd say. And you see it right now with sort of
02:28what's gone on at the NFL, their recent deals that they're doing. So clearly it's part of sort of
02:33mainstream viewing habits. And this whole concept, I think that people would, the knock on streaming
02:37was also, you don't, you lose sort of the sampling effect. And I think what you see with our deal
02:42with Apple is, is that people sample in different ways. They go into an Apple store, or you watch
02:48other content that's on Apple TV, or Apple Music, or what they do with Apple Maps, which they did in
02:54the
02:54Miami race, where they sort of created an app, you know, integrated into Apple Maps with stuff around
03:01the Miami race, and they had special content for that race. So you've got platforms now that because of
03:06the technology they have, because of their sort of, in Apple's case, singular focus on Formula One,
03:12the ability to actually expand your audiences in different ways than you ever have.
03:16Do you think that you're going to move to a Netflix type of model that you did with F1 when
03:22it comes
03:22to MotoGP in the U.S., where you have a TV series about it, and you sort of broadcast it
03:27to popular
03:28consumption in a way to democratize exactly what it is?
03:31Well, I think what you're going to see with MotoGP is a lot of what we did with Formula One,
03:37there will be similar applications of that. So the biggest thing for us with MotoGP is how do you
03:42take the sport, which at its core is a very pure sport and a huge, you know, passionate fan base,
03:49and how do you expand that? How do you get more people engaged, whether it's in the U.S. or
03:55worldwide?
03:55And I think you do that by telling the story. And we haven't told, MotoGP has never really told that
04:01story. And you do that through riders, you do that through the action on the track, and you do that
04:07sort of in multiple ways through content, through fan activation at races, through the licensing
04:14partners and the sponsorship partners that you have. But I do think the content piece of this is a very
04:18important part. Whether you do a show just like Drive to Survive, I don't know if that's necessarily
04:24going to happen, because it's a different sport. And you want to remain authentic to your fan base
04:30and to the fans that you're trying to attract. So we will figure out things that we can do in
04:35and
04:35around MotoGP that sort of creates the same impact and making it available and making it accessible to
04:41as broad a fan base as possible. You also help to oversee Live Nation, the Live Nation investment
04:46through the Liberty Board. And I'm curious from your perspective, ticket prices are really expensive.
04:52Everyone talks about it. Everyone complains about it. But the inflation in ticket prices to go see
04:56events is incredibly high. And then they still go. How do you understand the inflation and ticket
05:02prices, whether it's World Cup and what's going on there, or whether it's basketball at Madison Square
05:09Garden, and understand what's the right pricing? How do you do that strategy?
05:14Well, the reality is, it is simple supply and demand, right? And so I think what you're seeing
05:20is there's huge demand for live entertainment, live events. And, you know, I see this through
05:26the Formula One lens, where our paddock club is for the most part sold out through the rest of the
05:32year
05:32here already. The high-end club. That's the high-end, you know, tickets and hospitality that we offer.
05:38And I think there's just so much demand for these sorts of experiences that the reality is you could
05:46probably, you know, create multiples of availability and it's still going to sell. I don't know about,
05:53you know, the specific has been specific ticket pricing strategy for those. But I think ultimately
05:59what you're speaking to is there's just this demand, this pent-up demand for live entertainment
06:05that, you know, you continue to see, despite the fact that there are a lot of different things
06:12that people can go to. But I think that's the allure of that and the appeal. And for different
06:17people, it's different reasons, right? Some people go specifically for the racing. Some people go for
06:22the racing and for the food. Some people go for the racing and for the celebrities. Whatever it is,
06:27there's this just attraction to it. And I think we're bringing that to the fans.
06:31»
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