Playing our Part - Mark Cuban at Zeitgeist Americas 2011

Uploaded by zeitgeistminds on 27.09.2011

[ Applause ] >>John Battelle: So I was doing really deep
research on you. >>Mark Cuban: Where? Back at the bar?
>>John Battelle: Yeah. No, I was just reading Wikipedia.
[ Laughter ] >>John Battelle: And the one thing really
jumped out at me, so I wanted to start with the beginning, one of the first things you
ever did. Apparently you made $1,000 as a kid on a chain letter.
>>Mark Cuban: Yep. That was in college. >>John Battelle: You are that guy --
>>Mark Cuban: I'm that guy. >>John Battelle: -- who actually made money
with one of those things. >>Mark Cuban: It was my junior year in college,
and I had to figure out a way to pay for school. So they had one of these chain letters going
around. And so I just said, Okay. Somebody is making money.
I would go around and it was a deal where you gave me $50 and send $50 to the person
at the top of the list, took him off and then put your name at the bottom.
What did was I helped everybody, all my friends, sell their version so they got all their money
back. And then the power of networking, right, back then, it just took off. And I spent the
next few weeks just going to my mailbox every morning and collecting 50-dollar checks and
cashing them and I paid for my junior year of college.
>>John Battelle: That's quite a story. Seems like that's been happening to you ever since.
[ Laughter ] >>John Battelle: But I think there is more
work involved more recently. You're well-known for having opinions.
>>Mark Cuban: Yep. >>John Battelle: And so I'm hoping to elicit
a number of them from you. As a matter of fact, you have so many hot-button issues I
wasn't really sure which one to start with. But we may as well start with -- given, I
think, it has been in the air the past two days, which is the economy.
>>Mark Cuban: Mm-hmm. >>John Battelle: You've written on your site
-- you have posted a number of opinions about the economy, about bankers in particular and
about modest proposals for how to fix it. So what do you think is wrong? And how do
we correct it? >>Mark Cuban: Just a simple question like
that, right? >>John Battelle: Solve it for us, Mark.
>>Mark Cuban: Solve it for us. I think the primary problem that we are facing, I think
-- and everybody is recognizing this -- is bipartisanship.
Everybody is so partisan in their feelings, right? Everybody is so philosophically driven
that no one is addressing issues. And so I think we have to get out of politics and actually
have action items. You know, we fail to recognize that at some
point things change and you have to let go of old dogmas and old philosophies and just
deal what's in front of you like in business. It is just little simple things that we all
know is obvious. We get a budget from the -- our government
leaders. That's a ten-year budget. Who does ten-year budgets? You know, how are you going
to fix something in ten years? Even the communist countries have five-year budgets and five-year
plans. And then there's action items. One of the things I wrote was we have to fix
the housing situation. We had a bubble. It burst. We have significant problems. The values
have gone down. And to me the action item is all these homes that have been foreclosed
on that Fannie Mae, et cetera, own, you bulldoze them. You tear them down. You reduce the supply.
That increases the value of what's there. You create work for people who are most difficult
to employ. All they got to do is knock things down. That's an action item.
There is just so many things that you can come up and do. But we have to recognize that
someone has got to come in and propose actions. And then I think there's -- I've talked -- People
have asked me about taxes. And, you know, the headline going out was "Cuban's willing
to pay as much as he needs to in taxes," et cetera. I hate taxes. I hate taxes as much
as the next guy. >>John Battelle: You said paying taxes is
the most patriotic thing you can do. >>Mark Cuban: But when you look at the economy
the way it is, right, you can't just, again, go back to philosophies or dogma. You have
to recognize the circumstances and contribute. And I've earned quite a bit from not just
Yahoo! but, you know, the fact that you can be entrepreneurial in this country. There
is infrastructure. There is people who have given their lives to create that opportunity
for me. And for me, in the current state of things,
you have to be able to give back. And for any entrepreneur in here, going out there,
busting your butt, being rewarded economically, the most patriotic thing you can do is pay
taxes because, you know, ask not what your country can do for you but what you can do
for your country. I think you can just go down a long list of
action items. But until we start taking action instead of talking about things in general
broad brushes, we are going to have problems. >>John Battelle: Would you say you are in
the Buffet camp, so to speak, in terms of you're not paying enough taxes?
>>Mark Cuban: Yes. Now, do I -- would I like writing a bigger check? No. I think a big
percentage is going to go to waste. I think there is a big difference between investing
and spending. Right now we don't have somebody who is a chief investment officer.
Look at Google. Google invests in things left and right, but it is an investment. Not all
of them are going to work, but they create opportunity. And that's -- we don't have anybody
in government who is looking at that. We can borrow money at essentially negative interest
rates. We should be spending them in investments as opposed to spending them on expenses. There
is a big difference. I don't think anybody in our government structure right now understands
the difference. >>John Battelle: You have said, to sort of
switch to another part of one of your rants, has to do with the way that our current regulations
are set up for patent law -- >>Mark Cuban: Right.
>>John Battelle: -- for example. Your approach to patent law is similar to your approach
-- >>Mark Cuban: Get rid of them.
>>John Battelle: -- to houses on the market, which is to bulldoze it. Can you elaborate
a bit? >>Mark Cuban: Look, it's crazy. I will give
you an example, one of my companies. You talk about things that inhibit job growth, inhibit
corporate growth, inhibit entrepreneurship. I have a company Magnolia Home Video. We distribute
DVDs. We got sued because someone has a patent for
detecting scene changes in video that they were awarded in mid 2000s, 2004 or -5, right?
We were doing scene detection of video back in the late 1990s. But back then, we just
didn't create patents for everything. And you've got all these patents that are
being awarded that are just out there just to try to siphon money from people. To me,
that's killing commerce, that's hurting. I read something from the former CTO of Apple
who said that when he left in 1989, Apple owned the grand sum of one patent. Boy, they've
changed their ways now, haven't they? So, to me, I recognize that people say, You
know what? Small guy has a great idea or small woman has a great idea and wants to protect
their idea, they need a patent. But for that one anecdotal scenario where you protect that
one person, there are 99% other scenarios where you're holding back to the economy,
you are holding back big companies. So Google has to go out and buy Motorola for
a patent trove. And it becomes a game of, you know, thermonuclear war. Who can create
the greatest deterrent to keep someone from dropping the bomb? And that is not good for
the economy. That is not good for entrepreneurship. That's not good for the United States.
>>John Battelle: You brought up Google, so I want to ask you a question because you have
written about the company quite a bit. >>Mark Cuban: Not that much.
>>John Battelle: So I get to ask a question that our host has agreed I'm allowed to ask,
or at least they said "Okay, John, you can." [ Laughter ]
>>John Battelle: What's your view of YouTube? >>Mark Cuban: What a horrible acquisition.
[ Laughter ] >>John Battelle: Care to unpack that?
[ Laughter ] >>Mark Cuban: Yeah. Everybody get it out.
You talk about horrible acquisitions. Okay, yeah. Okay, that's out of the way.
[ Laughter ] >>Mark Cuban: But in reality what has YouTube
evolved to? It is a utility that, in essence, subsidized the bandwidth for video of the
world. >>John Battelle: How can that can be a bad
thing? >>Mark Cuban: It is not bad for us, right?
But in reality from a business perspective, what have they -- you can do that any time.
They didn't have to go out and buy YouTube. They had Google Video. All they had to do
is say, Whatever video you have, you just post it and we will pay for all the upload,
the bandwidth, everything, the servers, the storage.
They didn't need to buy a company to do that. So they took all their baggage. They are still
fighting legally all their baggage. I think if you said right now are they in the best
possible position they could be in the video world relative to everybody else? Well, they've
had a great social impact. Their content ID system is phenomenal. We wouldn't have that
if they didn't have all the lawyers to fight. So they have had a lot of great developments.
But they could have started back then and going out and doing the things they are doing
today and be ten times further ahead. I don't think they accomplished anything by buying
YouTube at all. >>John Battelle: Well, thank you for that
opinion. [ Laughter ]
>>John Battelle: Moving on, what do you think of Facebook?
>>Mark Cuban: I like Facebook. I look Google+. I like Twitter. And they are all serving their
own roles. Facebook, I think, is how you communicate with some of your closest friends. But -- and
Twitter is a broadcast medium. And Google+ is trying to figure out where it fits relative
to all of that. I think what's has changed with Facebook is
that it has gone from just a way to communicate about things that are personal to you to your
friends to a personal branding medium, even among a close group of friends. I'm not talking
about someone who has 4,000 friends. I'm talking about my wife and our family members
and the way they use it to their friends. You know, you have to make sure you have the
right picture of your kids and they are wearing the right clothes because you want to be perceived
as being a good mom. And, you know, they are in front of the picture of the good school
with the good stuff. And so we've -- we've turned Facebook into
a personal branding medium even within the smallest groups.
Now you have Google+ coming in and saying, Okay, I recognize that. What is it that we
can do to kind of complement that or be different than that? And I think where Google+ has done
a lot of good things is it is not trying to be so personal to this point.x. It is not
trying to get down to the very -- you know, my wife and her friends, et cetera. It is
a better discovery mechanism. And so I like Google+ because I think there
are smarter people on there generically having smarter discussions, and there is a better
way to interact and still personally brand. And so I have a circle of friends I call my
"tech superstars," with John or somebody. So if I want to have a conversation or elicit
some response related to tech, I can do that. If it is my buddies from Indiana I played
Rugby with -- which got me in trouble with Deadspin, I will post pictures there. I learned
to keep them private from now on. But I can have a different type of conversation,
different type of interaction there. And I think because there are so many fewer limits
on Google+, there is a better interaction. I think Twitter is the one that's suffering
right now because it is almost impossible to interact on Twitter. And the majority of
what's posted on Twitter is not even seen. It is great to say you have 600, 700, a million,
5 million, 10 million followers. But what is that in terms of consumption? We really
don't even know. So I think we're walking into a great Darwinian
battle here between all three. So Facebook has added their publish feature, which is
pretty cool, but there is no filters. There is no way to control it.
Google+ has something similar because there is no limits and there's circles as one minimal
way to control it. But I think we are going to have to get smarter. And how both of them
compete to make that publishing or broadcasting mechanism work is what's going to be fascinating.
And I think we'll see -- you know, I think in terms of popular figures, celebrity brands
and everything, Facebook doesn't have it won yet. If Google+ comes up with the right things,
they can have a very significant impact. >>John Battelle: Yep. You mentioned earlier
that one of your pictures got you in trouble. You get in trouble a lot. How come?
>>Mark Cuban: Because I just don't give a shit, right?
[ Laughter ] [ Applause ]
>>Mark Cuban: Look, somebody had to be the luckiest guy in the world. Like Mr. Chopra
was saying, all the endorphins and everything, mine are flashing all the time, boy. I don't
have to be looking at someone to be in love. I'm having fun.
And so I have gotten to a position now I think where I don't need anything from y'all, right?
So let's just say what's on my mind, as long as I do the work. You can disagree with me,
and I like when people disagree with me. I like when it gets public and it becomes a
public argument because people have to bring their A game to disagree.
And to me that's fun, right? I like challenging things. I like being able to look at -- My
strength is not being -- out-teching somebody else. I'm not going to understand all the
personalized medicine elements even though I think personalized medicine is the future.
I am not going to be able to write code even though I used to. That's not me. I am able
to look at a business, drill down to it very, very quickly, and understand what's going
on and challenge it. I like to challenge it. It is like day-and-date movies. The head of
the MPA said I was the devil because we wanted to release movies day and date with DVD and
theatrical. So when he said it was horrible to do it the
same day, I said, I will kick your ass even better. So we are going to release our movies
on to transactional VOD, on cable and satellite, et cetera, systems a month before they are
in theaters. Now, our business -- our Magnolia Home Distribution makes money on every movie.
That's unheard of in the movie industry. Where you can look at things and say "this
is the way they have always been done," I like to look at it and say, "If everybody
is doing it this way, that's not where the future is. You have to look somewhere else."
If that pisses people off, that's their problem. >>John Battelle: Let me ask you a quick question
about the Mavericks. Are they going to be playing this year.
>>Mark Cuban: I didn't say I like to pay fines just for the fun of it. I like to cause hell
for the fun of it. I can't even answer that question, so...That
will be an expensive one. [ Laughter ]
>>John Battelle: All right. Let me ask you another question. Do you like baseball well
enough to buy the Dodgers? >>Mark Cuban: No. No.
>>John Battelle: That was a quick answer. I'm from L.A.
>>Mark Cuban: Yeah, I kind of figured. >>John Battelle: I was sort of hoping the
answer would be yes. >>Mark Cuban: Next question.
[ Laughter ] >>John Battelle: All right. Let's pull back
to the theme of this session which is innovations and the impact particularly of technology
on our future. >>Mark Cuban: Yep.
>>John Battelle: What do you think the most important technologies and/or trends are right
now that are going to affect the near term, one to three years, of our --
>>Mark Cuban: I mean, look. You can go in a million different areas there. I don't think
there is any one. I mean, long-term, big picture, personalized medicine is it.
I mean, think about it. The fact that you walk into a drugstore, you buy a bottle of
aspirin and you don't really read the fine print but it says, "You just may be the unlucky
MF that dies from this aspirin." [ Laughter ]
It is crazy, right? That's going to change everything. There is no question about that.
Shorter term, you know, I think, again, if everybody is looking in the one place, then
to me it is the wrong place. And we've been doing -- since we started with YouTube, we've
been doing video online. We started doing in 1996. 15 years now, right?
It hasn't changed all that much. And, you know, you go to YouTube to pick on
them some more. And, believe it or not, 15 years into it, you watch YouTube and there
is a little overlay with a X to click it off and there is a preroll. That's what we've
come to? That's advancements? And I think part of the reason is the Internet
isn't designed to be the future of reruns of Gilligan's Island, right? There are networks
that are already designed to provide video. And I think that's what a lot of Internet
video bigots are missing, right? The future of television is television. And
I think what's really changing going forward, particularly in communication, is that we
are evolving to realtime communications. People want things live. They want things realtime.
And when something big happens, you may get it from Twitter. You may get it from a Google+
stream. You may get it from a Facebook status update. But then when you want more, it is
hard to get a lot of people to go to one spot except on television.
I think what a lot of people misunderstand is that television is digital. This isn't
1985 anymore. So 300 channels and nothing on. But, for the
most part, those 300 channels are digital. But they run on a network designed to 69 video
distribution, so it's not going to buffer it. You know it's always going to work. They
have access to the same VOD hard drives that YouTube uses to serve up, you know, on-demand
stuff. It's just a better designed network. But now we're starting to get the opportunities
to leverage that network. Like at HDNet, it's all about interactivity, the high def and
the net. You're going to see more things develop on the television side of things than on the
Internet video side. I just think Internet video, even though it's scaling, it's growing,
is broken. >>John Battelle: I want to ask you to do something
that I do sometimes with folks like you, which is, I'm going say one word and you're going
to say the first thing that comes to your mind. Ready?
>>Mark Cuban: Yep. >>John Battelle: The NBA.
>>Mark Cuban: Next. [ Laughter ]
>>John Battelle: You can't say that every time.
>>Mark Cuban: We are the champions. >>John Battelle: The Tea Party.
>>Mark Cuban: Waste of time. >>John Battelle: Bankers.
>>Mark Cuban: Hackers. >>John Battelle: HP.
>>Mark Cuban: Digital equipment. [ Laughter ]
>>John Battelle: Did you mean digital equipment corporation?
>>Mark Cuban: Yep. >>John Battelle: Okay. Just checking. Google.
>>Mark Cuban: Great company with Microsoftian tendencies.
>>John Battelle: That wasn't one word, but we'll take it. Network television.
>>Mark Cuban: Network television, specifically challenged but with opportunity.
>>John Battelle: We have a couple minutes for audience questions. There's mics here,
so please go to them. And, while we wait, I wanted to ask you one of my last questions,
which is one of the themes throughout these last two days -- you've seen a lot of inspiring
for-profit, nonprofit, and other forms of organizations that -- whose intent is to make
change in the world or do good in the world. Another thing that Warren Buffett has said
is that he's going to give all his money away or almost all of it. Even a little percentage
left over, I'm sure, is enough to take care of his family. How do you do that? How do
you effect that kind of change in the world? >>Mark Cuban: Well, two answers there. One,
whenever I give and whatever I give, I do it anonymously. Because I want it to be for
the right reason. And I hate being pimped out by charities or whatever. I don' t want
my name on things. Two, I'm not ready to give half of what I
have for a lot of reasons, what Ray Kurzweil said and what Deepak has said, because I've
got three young kids. And there's nothing that scares the shit out of me more than thinking
who knows what can zig and zag in their chemistry that creates a problem. And I want every asset
that I could possibly have available to me available to me in case I need to assist something
specific to them. So I'm not ready to make that commitment, because I've got three beautiful
babies that get all my commitment. >>John Battelle: Question here.
>>> Since you said that you like to be challenged, I didn't want to let the patent comment go
by unchallenged. >>Mark Cuban: Sure. >>> You mentioned 100 to 1 ratio of good examples
where they're helpful versus the control type thing that you describe. I posit that it may
be the other way around. In some industries, like medical devices, clean technology, and
so forth, it is an essential item in order to raise capital. And, if you compare ourselves
to Europe, where the patent system doesn't really work for small companies --
>>Mark Cuban: Look, I'll qualify. What I'd written about is business method process and
software patents as opposed to all patents. And so, still, to raise capital, I understand
the difference. There are industries that I look at that I prefer to see a patent because
it's protection, not because I think it's needed. But the reality is, if you have a
good idea, if you're smart enough to execute on that idea and given specifically for a
vast majority of technologically elements, particularly the costs of creating those businesses
has dropped significantly, you don't need -- you can still be successful without the
patent. And there are other laws with software. There's copyright laws and other ways to protect.
And there's other laws with traditional business that don't require patents, because there
are trade secret laws and the like where you can protect yourself against someone coming
in and stealing. Yet, with patent laws, once you get an erroneously
issued patent, it's a shotgun in a crowded space. And I think that causes more problems
than it solves. >>John Battelle: We have time for just one
more quick question over here. I saw someone. >>> How do you fix the patent system?
>>Mark Cuban: Where are we at? >>John Battelle: How do you fix it? With a
bulldozer is what Mark is saying. >>Mark Cuban: Yeah. I'm saying for business
method and for software patents, you get rid of it. It's a lot more of a free for all for
sure. But, in our litigious society, people will find ways to sue to protect. But it doesn't
create -- with patents it creates the opportunity, as I said, for shotgun in a crowded room.
And I get sued for -- we all get sued for ridiculous reasons. And Google has to spend
$13 billion, or whatever it was, to get patents. Whereas, on the flip side, I'd rather see
it where, if I come in or you come in and steal one of my ideas, I litigate like anybody
else would litigate. >>John Battelle: We're running over. And it's
been an entertaining half an hour. Thank you very much. Please join me in thanking -- thank
you, Mark.