Google And Meta Will Beat OpenAI And Anthropic

0:00This episode is brought to you by Google Chrome. You think you know a browser, but Gemini and Chrome? That's new. It can help you with practically anything on the web, like restoring a vintage motorcycle from a 50-page restoration block, or finally break down that long article you've had open for weeks. Gemini and Chrome is here for it. Ready to make anything online makes sense? There's no place like Chrome. Check responses set up require compatibility and availability varies 18 plus. College football is back. So, Hilton called to me the superstition concierge to make your fan rituals a reality. Need a room to match your lucky number? We got you. Want to make sure our team doesn't wash your lucky jersey? Oh, that smells lucky. Hilton's unmatched hospitality can keep up with any superstition. Even a marching bandwicker call at 555 and 55 seconds. Hit it! When you need a team that will do whatever it takes on game day, it matters where you stay. Hilton, for this day. If you ask the average investor what is the leading AI company, they'd probably say open

1:01AI with Chatchy B.T. or Anthropic with Claude. After all, Chatchy B.T. is the go-to AI chatbot. Then you have Claude which is winning an enterprise. Now, while both of these companies are the leading AI companies today, I believe that things will change over the next five years. And I'll be making the case of why I believe the two companies that are best positioned to win an AI are Google and Meta. Google's Gemini 4 was just announced yesterday by Sundar himself. And he also released benchmarks showing its relative performance with the other flagship AI's. We're going to be looking over it, but also more importantly, how these companies are structurally positioned and how they're going down very different paths with marketing their products. Now, we also have a lot of other news to get into. For example, Netflix has been on a big sell-off. The stock continues to go down. We have an interview here with Ted Cerandos, the co-CO of Netflix. He said that Netflix is not growing as fast as he would like. And that's the headline that Bloomberg is printing everywhere. But we're going to be looking at Netflix's growth and what Ted Cerandos really said. And then of course, we have the fail the week which in this case is FICO, which is the

2:03worst performing company in the S&P 500 this year. It's now down 60% year to date. This is DevCantissarius favorite company and it's getting destroyed. We'll be going over everything that's happening with FICO. So we have a ton to get to in this episode. Let's go ahead and jump in. If you haven't already, join Qualtrim.com. This is my own personal membership. It's only $10 a month. You can try it out, risk-free with a seven-day free trial. And it gives you access to a load of benefits. You get access to Qualtrim, the entire website. You can do analysis on any stock. We have earnings, transcripts, discounted cash flows, all the stuff that you would expect. Plus, we're launching a mobile app. We have it in the iOS store in the United States. It already is getting extremely good feedback. People like the app more than they like the website. And we're only making more improvements. Plus you get exclusive content. I just did an hour-long exclusive on FICO. And you get access to a Discord community full of thousands of investors. Again, you can try this out with $10. It's the price of a sandwich. So try it out now. You have nothing to lose. It's risk-free. And I don't think you'll regret it. Now, it seems like every day in these AI wars, there's companies leap-progging one another.

3:08For example, we had the early leader, which was ChatchyBT. ChatchyBT went super viral. It was the consumer AI app. It was the one that was supposed to destroy Google's search. Now, ChatchyBT is extremely successful. It's probably one of the most successful products ever. But then you had an anthropic. Anthropic took a different route. Instead of focusing on the consumer use cases, like picture editing and video, anthropic went straight for code. And it turns out there's a lot of applications for code. Everything that businesses do in the modern world includes code. So anthropic went super viral amongst the workforce, amongst institutions. Automating different parts of companies. Anthropic came out with skills and integrations into different businesses. And then ChatchyBT turned their attention to Claude, also going after the enterprise applications. You had Claude code to begin with, and then you had ChatchyBT's codex, their own tool, for enterprise users and for coders. And while this battle is going on between the two unopposed leaders in AI, it seems as

4:10though there was a duopoly forming. It seemed like we're going to have a Coca-Cola and Pepsi situation, or a Moody's and S&P Global, or a MasterCard and Visa. It looked like for a while that it was going to be anthropic and open AI, the two undisputed and unassailable leaders in AI. But then things started to change. During this time period, Mark Zuckerberg pivoted very hard. He threw tens of billions, if not hundreds of billions of dollars, into creating data centers and to buying GPUs, into training his own models, and to using his own employees, capturing their keystrokes to learn how they worked. He went so far as to change the entire direction of his company and put all the financial resources of Facebook and Instagram into becoming an AI leader. And then it emerged with one product, which is Muse. Muse did a couple things right. Muse was not as confusing as ChatchyBT. When you enter into it, it has different toggles that you have to switch on for what model

5:10you want. For most people that aren't AI people, they don't know what model is even the one that they should be using. So this is confusion for the normal person using open AI's tools, but for Muse, you don't have one. You just type in and it gives you a great answer. Muse also has this nice little whimsical mascot, this friend that talks to you and creates a little bit of a relationship as you're using the product. He's cute and you can change and be customized in any way that you want. These were striking adaptions that Muse did over ChatchyBT or Anthropic. ChatchyBT and Anthropic at the time have been so lost in enterprise world, looking for coding applications and different enterprise workflows that they forgot about the consumer. And Metta was so focused on the consumer that they made a streamlined product that's very appealing for the average user. Muse's growth has been rapid. In fact, reports show that Muse's growth today is at a pace faster than when ChatchyBT first launched. So we also have Google with Gemini. Google was the leader in artificial intelligence. They had invested in this for a long period of time.

6:11And Google by every metric deserves to be the leader. They are the ones that have invested the most money. They're the ones with the full stack team. They have the silicon. They have the GPUs. They have all the server capacity. They even have the intelligence and deep mind. They had everything in order, but like in many cases, as a bigger, larger, bloated institution, as streamlined as a younger startup, they're not as nimble. Google got caught up in bureaucratic bloat. They couldn't release products because their products are too big. They have to scale too far. There's too many safeguards and bureaucratic red tape to step through to be able to push their product out. They initially released Bard and then they upgraded that to Gemini and they've been chasing the tail of ChatchyBT ever since. But Google's done a couple things that have surprised different investors. First of all, Google has shown that ChatchyBT really isn't destroying the Google search business. They've been able to protect that somehow. Second of all, Gemini has grown rapidly and this shows the power of Google's distribution.

7:11Gemini isn't just a app on the phone. It is installed on every Android. It's used in every part of Gmail and YouTube. It's integrated into Google Drive. It's integrated into every service, like maps that people use billions of times per day. So Google has been able to catch up at a rate that normally they should not. So Google is in a situation where they have all the right ingredients but they have been chasing ChatchyBT. They've always been a little bit behind. Now in my previous episode, I said that Google's behind but I'm not going to sell the stock. I own a lot of Google. It's my largest position. I have a $200,000 position in it and I'm not selling a share specifically because even though Google's behind, I believe that things can change quickly and it looks like they change quickly once again yesterday. Yesterday, Sundar posted on X that he is announcing Gemini 4. This is called Argon and it's Google's next flagship model. Now they also gave their benchmarks for Gemini 4. And when you do a more full analysis on where they actually lead and they don't lead, this

8:15shows it it's incredibly well-rounded. In fact, I plugged these benchmarks into ChatchyBT and into Muse to get their unbiased opinions as competitors and both of them noted that if these benchmarks are real, that Gemini 4 would be the most well-rounded, agentech technology in the world. It's not the best at everything but it's the best at many things and very good at everything. They say that it has frontier performance and complex workflows across real world software engineering, enterprise knowledge work, like legal and finance and cybersecurity defense. Now you may scoff at these benchmarks but this is important. A lot of companies and users and organizations are deciding which model to use based on its capabilities, which one does the task at hand competently in a reasonable amount of time, and which one is priced the best. And many people doubted Google once again. Even semi-analysis wrote an article. This was August 6 saying that Gemini is cooked. Part of that article they say Google has 0% chance of ever having a frontier model again.

9:16In here we have what Gemini 4, according to the benchmarks, it is quite possibly the best or one of the best models, definitely competitive with the other frontier models. Google is officially no longer behind. Google has caught up. They are right there with the other frontier models. So that's important in and of itself. But there's something else going on that makes me more bullish on these two companies in particular. Google and Meta. Now, I'm fully invested in these companies. I have a combined $400,000 between Google and Meta. So this shows it's important to me in getting this right. But I believe that Google and Meta both are set up to be the two biggest winners in AI, even more than Anthropic and OpenAI. Now again, there's big arguments against this because everybody will say that everyone's using Anthropic at their job or at their work. Everybody will say that they have Chatchubt installed on their phone. And that's true. But there's something different going on. One of them is the financial realities for these companies. Even though these companies are competing with different frontier models and they're kind of going back and forth, one day Mews feels like it's the best.

10:16The next it's Chatchubt or Anthropic. The next it's Gemini coming up with Gemini 4. They're all just leapfrogging each other with this technology. And while they battle that out, that's only part of the game. The other part is the financial reality. You see, OpenAI and Anthropic are not publicly traded, so we can't see their financials quite yet. But what we do know is that they have a lot of debt. And a lot of debt is probably the understatement of a century. They have enormous mountains of debt. That that we've never seen in different companies, obligation is so big that it's almost incomprehensible. These are the amounts of debt that people like Michael Burry have been writing about. It's just too much debt. In his mind, he thinks these companies will collapse under the way of their enormous obligations. He doesn't think they can pay anybody back. He also talks about how NVIDIA is funding these companies, trying to prop them up because they can't financially fund themselves. And we've seen that with these companies. We've seen Anthropic recently turned net positive, so they're at least making a profit.

11:17And we see OpenAI driving towards that point as well. Both of these companies are under financial pressures that don't exist with Google or Meta, not at all. And the pressure must be immense. For example, the only way that Anthropic has to pay back on all their obligations, all the agreements they signed, all these deals, hundreds of billions worth of debt, nearly half a trillion dollars in obligations, they can only pay that back through AI. That's how they monetize. The one tool they have to pay back all these lenders is with the product itself. Anthropic, Claude, Opus, their models. They have to monetize them enough and make people pay enough so that they can pay back on their lenders. They have to do it. They have no other revenue stream. And you have OpenAI with ChatchyBT. ChatchyBT is in a very similar situation. They've said that they're a healthy business. They said that they're making money and they can become really profitable. But what OpenAI has been doing has been signaling that they're really turning the screws on monetization.

12:17They know they have enormous obligations. They're filling the weight of that. They have to generate positive income and a lot of it to be able to pay back. The only way that OpenAI, like Anthropic, can pay back on all these obligations, this mountain of debt, is by charging for their AI, by directly monetizing it, by making it ever increasingly expensive for the consumer. Now they'll do this either by loading ads and making so you have sponsored listings within your chat application, or they'll just directly charge you, like they did with Codex, basically doubling the price of the $200 plan. OpenAI made it so that the $200 plan now gives you half the credits. And they introduced a new $500 plan that only gives you 20% more credits than the $200. This is another way of having a massive price hike. OpenAI is raising prices and Anthropic is raising prices specifically to make it so that they can pay back on their debt. Now compare that to the situation of Google and Meta. Google and Meta's are free.

13:18In fact, when you look at Muse, it gives you a crazy amount of usage for free. I have my sister who's not a tech person, barely knows how to use a computer, but she's used Chatchy-P-T for all the basic stuff, for searches and creating birthday invitations and lots of fun stuff like that. She continually ran in to limits on the free Chatchy-P-T. On Muse, she has not. Not even close. In fact, she says that it's so great she can use it all day long for every application. She's told friends about it because it's so much usage without the caps that Chatchy-P-T has. And that's the difference. With Meta, they don't need to monetize with Muse. Meta's not in a situation where they have a mountain of debt to pay back on. Meta's not even funding this whole thing by debt. They've taken out very little debt and almost all of their ambitions in AI are being funded by their cash flows from Facebook and Instagram. See, Meta has the advantage of having these other businesses that gush cash every single day. Mountains of cash being able to fund this massive AI opportunity.

14:19And on a recent podcast just a couple days ago, Mark Zuckerberg talked about just that. He said that there are going to be companies that get really hurt in AI. But he says with Meta, there's basically no risk. If AI doesn't work out, they're not in debt. If the company's not in trouble, they're not going to go bankrupt or anything. There's really no stress in the situation. And meanwhile, they can give users enormous amount of free usage. They can make really streamlined product to gain massive user adoption. And Meta's very good at monetizing free products. That's kind of their thing. With Facebook and Instagram, they've shown that they have the ability to make a lot of money with free products. But at the same time, they can afford to lose money on AI for a very long period of time. Much longer than open AI or anthropic. See Meta has the advantage of an enormous piggy bank that's ever increasing, always flowing. Instagram and Facebook can fund their AI efforts until they make Chatchy B.T. run out of money, until they make them not competitive with the value proposition that they offer. And consumers are already starting to notice the difference.

15:21One of these companies offers a product that is virtually uncapped for the average consumer. The other one has very quick caps for the free Chatchy B.T. Muse in and of itself is an agent. That's what it does. It opens up browsers and it does work behind the scenes that helps you accomplish things you want to do. Open AI's response to Muse was to create dots. Their version of an agent. Now I think the mascot in and of itself is not quite as compelling as Muse. That's just an opinion thing. But one thing that's not an opinion is the way that they've monetized it. You see, Muse is free for everyone. Everybody has access to the SigenTech technology today for free. Chatchy B.T. has gated dots behind the plus plans. They're not offering this for free. Only paid users, which is a tiny minority of users, have access to dots. So most of them are not going to see this new agent technology. And why doesn't open AI include dots for free and Chatchy B.T. like Muse is for their users? Well, of course, because they need money and they need it right now. If they want an IPO, they need to show that they're growing in profits.

16:24So you have this distinction between these companies. They already have this massive cash load that can indefinitely fund their new efforts, competing with companies that are strapped for cash. They have to continually charge for products and limit usage and increase prices. And the value proposition is getting wider and wider between the different products sets. When Sundar announced Gemini 4, he said the introductory price for it is going to essentially be half the price of the equivalent from anthropic, a 50% discount on an introductory price. Now we don't know when that introductory price discount is going to end. That's going to attract a lot of developers in the meantime. If you're getting essentially the same performance for half the cost, that can save a lot of money for a lot of people. And how can Google afford this? We'll see with Google, they don't need to monetize Gemini directly. When investors look at Google, they notice that the company has many assets that benefit indirectly from their AI leadership. Google looks at Gemini is just one more part of Google. Google has cloud hosting. They have an entire chip business. They have their AI and deep mind, and then they have YouTube and Waymo and search and enterprise

17:27applications, Gmail, on and on and on. Google has like nine different apps that are used by a billion plus users. It is a sprawling business that is incredibly profitable, and they have no pressure to generate enormous profits in the short term from Gemini. Google knows that Gemini is not the end product. It's not what they need to monetize through. If Gemini helps YouTube grow by better recommendations of video, if they want to make a video, if Gemini helps Gmail maintain its market share and better advertise, Gemini helps other aspects of the business like search, which it's integrated into search, then Gemini will be like a waterfall monetizing all parts of the business. The exact same thing that Muse is doing for Meta. So these two companies, Google and Meta, are in no situation to rush to monetize their applications. Instead, they can go for massive land grab, market share. They can undercut and thropic and open AI every turn. And pricing is just one aspect of why I think they'll be winners. Now aside from the differences in financial realities that these companies face, there's also a different reason that I believe that Google and Meta have a very good chance of becoming

18:30the biggest AI companies and biggest winners. And part of that is simply friction and trust. Now you may say trust is not an advantage of Meta. In fact, a lot of people are distrusting over the company. I'll dress that in a minute. But I want to go first to friction. You see, I have a paid chat to be key account. I think it's great. But when I look at integrating it and using it agentically, you have to use connectors or plugins. They have all different names. So it's basically connecting things to your chat to be key account. In this case, when I go to the most popular plugins across all of chat to be key, number one is Gmail, number two is Google Drive. Then going down the list, you have all different plugins, some from different companies, but many of them from Google. But overall, the most popular plugin in the world for chat to be key, the most used agentic use cases are Gmail and Google Drive. That's what people are using chat to be key for. Now you may say that many people trust chat to be key so they'll plug in with Gmail and

19:31Google, but there is no trust deficit that needs to be bridged when you're using Gemini. You're literally using a Google product. Google will still likely have a prompt where you can enable it, but it'll be much simpler. You don't have to enter in credentials. You'll have to go through the two factor authentication to say, hey, does Gmail really have permission to access all of this? This will make it so that if Gemini 4 really is frontier, which it appears to be, that you'll have an easier time integrating with all the apps that you would normally integrate with, which is Google Drive and Gmail as a top two. So the trust factor is already solved by Google. But then you have Meta, which a lot of polls say that people don't trust Meta. They have a big distaste for it. A lot of this is media framing 3.7 billion people that don't trust Meta, log in or use one of their applications every single day. They use their chat services. They post pictures on Meta. They post on Instagram. They read it. They give information every single day. And these actions speak much louder than a few surveys from people that don't like Meta

20:31on the surface. When I look at it, Meta, I believe, will gain the trust of consumers. But the other advantage that Meta has, the anthropic and chat to be D, are trying to gain is distribution. Now, chat to be T has a lot of distribution, but this is also a problem. See with Meta, they have it everywhere. Meta has WhatsApp, which mues is like appearing everywhere in. Then Meta has Instagram, which mues is at the top of your feed. They're integrating it into Instagram. Then you have Facebook, which a lot of people still use. I know young people aren't using it as much, but a lot of people still use Facebook. And Meta has integrated mues into it. Has put advertisements of mues intertwined with it. Meta has the biggest distribution by users every day of maybe any company in the world. OpenAI has a lot of distribution, but it's confined into one app, just one. Chat GPT. So OpenAI has a problem here. To make an agentic assistant that competes with mues, they'd have to make another app. But then they'd have to start from zero downloads. That would be difficult because they don't have an Instagram to push it, or Facebook

21:33to push it, or WhatsApp. They don't have all of these different assets to get people to try it out. They only have Chat GPT. So what does OpenAI do? They tuck their new agentic assistant dots as an item in the menu. And there's toggles and switches and menu items and libraries and projects and canvases. There's all sorts of things that are difficult to understand. And then there's dots now tucked in the corner if you're a paying user. What do dots even mean? A lot of this is becoming more confusing. Is dots like the normal Chat GPT? Is it different? How are they different? You see OpenAI, putting everything into one app which is Chat GPT, is making things way more confusing. And this is being noticed by even a lot of AI people. We have single hair saying, the mues hype is real. I can definitely say that it is the easiest to use and most focused consumer AI product on the market. The extremely generous limits also make it impossible to ignore. It actually helps the average person navigate day to day complexity of personal life.

22:33He says, here's what he would have done with Chat GPT instead. I probably would not have created a super app. Instead I would have created two distinct product services. Yes, I understand the downsides, especially heading towards an IPO. But almost every great tech company eventually becomes a collection of products either through acquisition or by building them. Google has like eight products with 2 billion plus users. Facebook has lots too. The main problem is that trying to turn Chat GPT into a super app has created an enormous amount of complexity, not just technically but cognitively. There are so many modes and tools and agents and surfaces, etc. They even describing the product to a normal person is getting difficult. Chat GPT is becoming insanely complex because they know that they don't want to start an entirely new app. They're going into IPO. They know that they don't have the distribution to push an entirely new app. Instead of doing that, they have shoved it into the existing Chat GPT, making an ever complex, more sophisticated, more cognitively difficult app to understand.

23:33While you have news, which is streamlined, easy to use with a huge amount of free limits. This is all creating a massive opening for Meta and Google. Now, there's no way of seeing the future, but we have every reason to believe that Google and Meta are in very advantage positions and have a huge opportunity to win in the AI race. Now, moving on, I want to go to another company that's gone through a bit of a sell-off here. It's one that's shown up on my DCF as being undervalued once again. In fact, it is the most undervalued company in my portfolio based on my own internal analysis. That is Netflix. We have a recent clip here. This is from Ted Srandos to CEO of Netflix addressing some of the concerns about the company. He was asked first about engagement. This episode is brought to you by Google Chrome. You think you know a browser, but Jim and I and Chrome, that's new. We can help you with practically anything on the web, like restoring a vintage motorcycle from a 50-page restoration block, or finally break down that long article you've had open for weeks. Jim and I and Chrome is here for it. Ready to make anything online makes sense? There's no place like Chrome.

24:34Check responses set up require compatibility and availability varies 18 plus. College football is back. So Hilton called to me the superstition concierge to make your fan rituals a reality. Need a room to match your lucky number? We got you. Make sure our team doesn't wash your lucky jersey. Oh, that smells lucky. Hilton's unmatched hospitality can keep up with any superstition. Even a marching bandwick up call it 555 and 55 seconds. Hit it! When you need a team that will do whatever it takes on game day, it matters where you stay. Hilton, for this day. An engagement is a, is a, is a, is another metric. But at the time we said that, I think we're pretty unsophisticated about how we talked about engagement. Meaning in that world, all the, all revenue is equal, a profit is equal, all engagement is equal. And all engagement is not equal. So we are first and foremost, we are growing engagement. So we're growing on 200 billion hours of watching. We grew 2% in our last announcement.

25:36But 2% is not what people are hoping for out of you, right? They're used to double digit growth. In, at least, and certainly in revenue and to some extent even in viewership they'd expect more. So my point about the growth in general, yes, overall we're not growing as fast as I want us to. And we're working on, on making that move faster. That last sentence you just said that we're not growing as fast as we want to is the headline of many articles being published today. That's the headline article. But he also goes on to explain the specific factors behind this growth and how much of this is actually misleading. We are though also doing things that create a lot of headwind of that number. Meaning when we do live programming on Netflix, which is a relatively new thing, we spend about 5% of our content budget on live events. They generate about 1% of our watching. So Netflix is chosen to hurt their watch time deliberately, which most companies wouldn't want to do. Now, they all, but they do a very different job that they generate a lot of signups. They're really effective for advertising.

26:36Signup, attention, advertising, all those things that they do. But it creates engagement headwind in how you invest against it. Investors are worried about something that's actually a strength. Engagement should not grow as fast as revenue growth. Because if revenue growth was limited to engagement growth, that means that Netflix's total revenue is limited by hours watch. Meaning that they would have massive pricing limitations. People would only pay proportionate to the amount of time they watch. But that's not how people pay for content. Headcut tickets sold for thousands of dollars just for one hour or an hour and a half of pure entertainment. That's because it was a big, meaningful event. And that's the reign of content. People pay a lot of money, even for a short amount of watch time if that watch time is really good. Every area, all of them are growing at least 10%. The company overall on a trailing basis grew by 16%. It's not a bad sign when your company's creating engagement that people enjoy. They're willing to pay more for it. They're growing throughout the world in regions that they're not currently big in. And in every territory, they're growing above 10%.

27:38That's not the story of a company that's struggling. Netflix is actually doing quite well. Now finally, we move on to the fail the week. In this case, I have to highlight FICO. This is a stock that I've been a fan of one part of it for a long period of time. And a bit concerned about another part. And it turns out that concern that's caused me to stay out of this company, despite its incredible fundamentals. Well, that concern has played out in a really bad way for FICO shareholders. And it's really unfortunate. This is one of the fail the weeks where I just feel bad for the whole situation. It feels very unnecessary. And it feels like a lot of people are getting hurt with FICO that don't need to be. It's a company that Dev Cantasaria has made a signature part of his portfolio. At one point, he had over 30% of his $4 billion equity portfolio just in FICO. It had raced up to $2,000. It looks like things were going good for Valley Forge Capital. Until we saw this sequence of events cause this company to trade down. Now I went through systematically every single thing that happened with FICO in a timeline in an exclusive episode.

28:39It is the downfall of FICO. What really happened? But if we look at this company, it seems as though it has no business to sell off this much. In the past five years, FICO has now underperformed the S&P 500. But it's also gone from $2,400 per share to around $600. It's a company that's growing quickly. The revenue grew 25% in the most recent quarter. The operating margins are extremely high. In fact, for the scores segment, they're at 90%. Even their software business, which is like the bad business for FICO, has operating margins in line of top-tier companies. It's operating margins on its software similar to Netflix's. This is a good business, and then the scores business is phenomenal. There's nothing else like it. Overall, FICO has one of the best businesses in the world, bar none. It was an indisputed monopoly. It was seemingly unassailable. They had the whole world in their hands. But like Uncle Ben says, in Spider-Man, with great power comes great responsibility. And that is what FICO didn't seem to understand.

29:42They had everything. They really did have everything. They had the whole world. An extremely profitable business, almost no real competition, regulators that didn't seem too concerned about them. They were poking around. But there wasn't any alarm. And then FICO made deliberate decisions to torpedo this entire situation, to just sink everything. You can blame regulators. You can blame different parties. But much of this was self-inflicted. FICO had literally just gotten through an open and closed department of justice case on whether they're a monopoly, an antitrust investigation. This was the government saying, hey, we think you might be a monopoly. We believe you might have a captive audience. And then FICO just raised their hand and they said, yes, we do. We're going to raise prices by 400 percent. Our customers can't do anything. Banks can't do anything. We have a captive audience. We are monopoly. We just wanted to affirm that and make sure it was crystal clear to regulators. This was everything regulators needed. Once the price hikes came into effect, regulators amped up the pressure enormously on FICO.

30:45And then you had Bill Pulse come to the scene. Bill Pulse used the price hikes by FICO, as well as different senators like Josh Halley, to emphasize pressure on regulating this company. When you'd go looking for a home, the credit bureaus would run your score as you get your credit pulled. And they'd also give you the FICO score and make a little money off the top. So whenever a FICO score was ran, both FICO and the credit bureaus were happy. They'd both make money. FICO decided to circumvent the credit bureaus, going around them, cutting them out of the equation. Their distributors and partners for years, which they had this cohesive relationship, now was under attack by FICO. And then you had Equifax respond aggressively, very counter to what FICO is doing, making Vanishing score half the price of FICO. FICO somehow not only made regulators upset by raising prices, but then they turned to their own partners and distributors and made them upset by circumventing them. They're also not just their partners and distributors. They're the people that own the Vanishing score competitor and they're the people that own the data of which they pull their scores from.

31:47This was FICO management choosing to destroy virtually every relationship around them. Now, of course, none of this was necessary. FICO could have been a better steward over their monopoly. They could have raised prices 10 to 20% a year. Enough that they make good money for their shareholders, but also they don't raise the eyebrows of regulators to such a huge degree. By raising prices nearly 1,600 over just a couple of years period, it made everybody on board with fighting against FICO, whether justified or not. It was now a PR campaign to destroy this company, to introduce real competition. And that's what we see being priced into the stock today. So as we see FICO today, even though some of this was out of their hands, much of this was self-inflicted by management and it's unfortunate and unnecessary. As it have monopolies need to act responsibly with restraint, with partnership, leadership, they need to work cohesively with their customers. AsML is an example of this. AsML has likely a better monopoly than FICO, one that's even more undisputed, and AsML

32:49could theoretically raise prices as much as they want. But they won't, because they're operating with a mature long-term vision. They work as partners with their customers. They want both of them to be happy with the situation. They don't want to attract undue regulation. This is a type of forward-looking management that a monopoly should have. In the case of FICO, unfortunately, it didn't have it. That's all for this episode. Hope you enjoyed. This episode is brought to you by Born in Roma fragrances by Valentino Beauty, the iconic fragrance duo. Donna Born in Roma, O Depart Fum, is a feminine fragrance featuring juicy black current, central jasmine, woody cashmurren, and warm vanilla. With masculine counterpart, Womoborn in Roma Odedualet has notes of fresh violet leaf, aromatic sage, green vetiver, spicy ginger, and mineral salt. Shop at macy's.com Brussels clean up nicely at sweet green. Maple glazed, roasted, and edges perfectly caramelized.

33:50Sweet greens fall harvest is back on the menu, and the season's most overlooked little green vegetable is dressed to be devoured. You know what to do. Order on the sweet green app. See you in the next one.