Eugene Wei tells us why the video opportunity remains as big as ever and how Silicon Valley will complete its takeover of Hollywood.
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Eugene Wei is one of my favourite writers (blog here, Substack here).
He’s an amazing thinker on business and technology (worked at Amazon, Flipboard, Hulu, Oculus) with a background in media and filmmaking (studied at UCLA’s Film School).
Not many people can pen these two articles: Invisible Asymptotes and The John Wick Universe Is Cancel Culture.
I recently revisited Eugene’s appearance on Patrick O’Shaughnessy’s Invest Like the Best podcast.
It’s so good.
This blog is a short summary of notes I took from that episode.
Patrick notes from the jump that — among his podcast guests — Eugene has “one of the most interesting backgrounds.” While the conversation clearly reflects Eugene’s breadth of knowledge, my favourite parts are his takes on video and film.
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The Video Opportunity Remains Huge
Eugene is a big believer in video as a medium of communication and feels that “video has a lot of room to penetrate a lot of markets that ….currently still rely heavily on text.”
According to him, many ideas and stories previously transmitted by books will be done so via video in the future. The Dr. Dre / Jimmy Iovine documentary Defiant Ones is one example of video doing a job that — in the past — may have been reserved for a biographical book.
Further, the primacy of video is supported by a number of tailwinds.
- Gen-Z communicates primarily through video (think Instagram Stories, Snapchat, Tik Tok)
- Video-first platforms are part of the “increased surface area” of status seeking and garners mass participation because the financial cost to the play the game is minimal (to be sure, there are still opportunity costs)
- People spend a LOT of time watching video (~6hrs a day)
- Humans seem to comprehend visual communication better than text
- Cameras to create videos (and related video editing software) are ubiquitous thanks to smartphones
Video and the learning opportunity is still in its infancy. Children are taught reading and writing in school, but not the art of visual communication.
Initial iterations of massive-online-open-courses (MOOC) under-utilized the video format. Early MOOCs were films of professors reading off slides (basically porting over the “old way” of doing things onto a new medium).
As more information is unlocked from text, it will be done so in a way that is native to the medium and appealing to the a younger audience
Per Eugene: “…the next generation of educational content will be much more appealing visually – it’ll have cinematic language and production values and will open up education to the masses in a way that we’ve never seen before from text.”
How might that look?
In his blog post about the Netflix show The Crown, Eugene talks about how Queen Elizabeth II modernized the British monarchy by televising her coronation and writes: “I can’t help but think of AOC live streaming on Instagram Stories from Washington DC, explaining arcane Congressional procedures in the newest of mediums.”
Perhaps the most up-to-date example of more “visually appealing” educational content is the rise of history videos on Tik Tok.
Silicon Valley’s Takeover of Hollywood
Eugene’s background makes him uniquely placed to understand the tension between Hollywood and the technology industry.
Four points on the topic that stood out to me:
- Modern Hollywood Studios Are Limited In Scope
Outside of Disney and Warner, Hollywood studios have transitioned from vertically-integrated operations (creating films from A through Z) to a thin horizontal slice of the industry (providing finance and marketing services to independent creative talent). - Video Is Table Stakes
With attention as the new scarce resource, every vertical of society has largely become about entertainment. No matter what industry you’re in, you’re competing with every other industry for people’s time and attention. That’s why politics is kayfabe and finance is sport. This means that having entertaining content (eg. video) is table stakes for everyone, including tech companies. - Wave 1 of Silicon Valley’s Hollywood Takeover = Spend Money
With creative talent largely independent and no longer yolked to Hollywood studios, Silicon Valley realized it could throw its excess cash to bring creatives into the fold and capture people’s attention. Tech companies currently treat Hollywood like an API, whereby “you put in $100m and get a video that you can plug into your existing business model.” - Wave 2 of Silicon Valley’s Hollywood Takeover = Integrate Tech
The next wave of Silicon Valley’s takeover will involve the integration of technology into the creative process. Increasing (and better) use of video to “unlock” text-based knowledge is one example. Other examples include all the different ways AI can be used in the production process.
Learn Filmmaking Techniques To Better Enjoy Films
When asked for his film recommendations, Eugene gives “insider baseball” advice and recommends that the listener study up on filmmaking techniques.
In the same way that playing a sport make watching the same sport more enjoyable, Eugene believes that understanding how films “work” improves the experience.
Here cites one scene from Jaws and one scene from Heat to make his point (I’ve cut Eugene’s explanatory audio with the film clips below).
- Zolly Shot: “A dolly zoom [zolly] is an in-camera effect where you dolly towards or away from a subject while zooming in the opposite direction.” (Studio Binder)
- 180-degree Rule: “The 180 degree rule is a filmmaking guideline for spatial relations between two characters on screen. The 180 rule sets an imaginary axis, or eye line, between two characters or between a character and an object. By keeping the camera on one side of this imaginary axis, the characters maintain the same left/right relationship to each other, keeping the space of the scene orderly and easy to follow.” (Studio Binder)
This has got to be the greatest film lesson in an investing podcast ever.
Parallels Between Product Design & Filmmaking
To finish off, my favourite quote from the podcast reflects Eugene’s diverse background; in the excerpt, he compares product development to the filmmaking process:
“At a meta level, product thinking is always evolving…I’ve worked on a lot of products. Some have succeeded the way I wanted. Some haven’t. You’re always learning a little bit. And the way I’ve come to think of it…[building software products] is a form of indirect communication. The software interface is a form of language, just like film is a form of language. You’re making a film on set, doing things with the actors, the camera, the lighting and the script and all the things like that. You know at some later date, you won’t be able to guide the viewer through the experience. The work just has to speak for itself. Products that have software interfaces are like that. Once I’ve built the product and someone is using it in the world…on their phone…their browser…I’m not going to be there to explain it. There’s always a level of communication and legibility in the product that has to be built in. A lot of product development is figuring out how much legibility should be built into the product while retaining some elegance.”