Welcome back to This Week in Stratechery!
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On that note, here were a few of our favorites this week.
- Netflix Questions. Netflix reached all-time highs last summer, as the saturation narrative of a few years ago was shattered by continued subscriber growth. Six years on, and Wall Street is getting nervous: do all of those subscribers actually watch Netflix enough, such that Netflix can show them ever more ads and/or charge them ever more money? Those worries were only exacerbated by the intended acquisition of Warner Bros.: is the Netflix growth story nearing its conclusion? I asked co-CEO Greg Peters all of these questions, including how and why Netflix is always learning and willing to change, and why the scarcity of compelling storytellers means that professional storytelling will endure in the face of user-generated content and AI slop. — Ben Thompson
- What TSMC Means to AI. For all the ink spilled on OpenAI, Google and Nvidia as the main characters driving investments and fascination in the middle of the AI boom — this Stratechery Article, for example — it can be easy to forget that all of them are dependent on the same company to fab the chips that make any of this acceleration possible. Wednesday’s Daily Update explored that dynamic through the lens of TSMC’s capacity constraints, including questions about restrained capital expenditures over the past few years, and the tension implied by the news of the company’s planned investments from here. We went deeper on an excellent episode of Sharp Tech, with an extended discussion of TSMC’s past struggles to wield its pricing power, and why AI companies of the future should be answering TSMC’s restrained spending by working to build up competitors. — Andrew Sharp
- And Now, Some Basketball. A useful heuristic for modern life is to keep in mind that anytime the Internet appears to be in unanimous agreement, the truth is more complicated than what’s being presented on Twitter. Such is the case for the Luka Doncic trade, which shocked the world almost exactly one year ago, and was greeted last year with near universal certainty that it would be remembered for generations as an inexplicable disaster. In this week’s Sharp Text article I wrote about why I disagree, and why a trade that was indisputably a short term mess for Dallas may yet look more explicable as the years pass. Meanwhile, on a nearly two hour episode of Greatest of All Talk on Thursday, Ben Golliver and I had a bad time discussing a brutal Jimmy Butler injury, and then a great time making our All-Star picks, marveling at a Lakers ownership mess, and fielding listener reports on what the NBA looked like in London last weekend. — AS
Stratechery Articles and Updates
- Ads in ChatGPT, Why OpenAI Needs Ads, The Long Road to Instagram — OpenAI finally announced that ads are coming to ChatGPT. It’s an important step, but one with far more risk given the delay — and the delay means the ads aren’t yet the right ones.
- TSMC Earnings, The TSMC Brake Revisited, Why AI Needs Foundry Competition — TSMC admitted that it has invested too little in the face of overwhelming demand for AI; that’s why the industry needs to facilitate competition for the foundry leader.
- An Interview with Netflix co-CEO Greg Peters About Engagement and Warner Bros. — An interview with Netflix co-CEO Greg Peters about engagement, competition, and the Warner Bros. acquisition.
Sharp Text by Andrew Sharp
- Was Nico Harrison Wrong? — Looking back at the volcanic backlash to the Luka trade, and looking ahead to the future for Doncic in L.A.
Dithering with Ben Thompson and Daring Fireball’s John Gruber
Asianometry with Jon Yu
Sharp China with Andrew Sharp and Sinocism’s Bill Bishop
Greatest of All Talk with Andrew Sharp and WaPo’s Ben Golliver
- The All-Star Format and Starters, KD Passes Dirk, The Most Depressing Trade Deadline Ever?
- Jimmy Butler Out for the Year, All-Star Reserves in Both Conferences, Trouble in Paradise for the Buss Family?
Sharp Tech with Andrew Sharp and Ben Thompson
This week’s Stratechery video is on Apple: You (Still) Don’t Understand the Vision Pro.