John Collison: prediction

Transcript context

…We've got two major revenue streams. One is advertising, the other is direct revenue. The direct revenue business is relatively new for us. I think over the last like two or three years. We just announced we hit 25 million Snapchat+ subscribers, over a billion run rate on the direct revenue business. That's been growing really nicely for us. Then advertising, of course, whether that's on the map, we've got a product called Promoted Places and actually really powerful closed-loop measurement around that. A lot of folks care right now about driving folks into their retail locations and Promoted Places plays a huge role in doing that. There's been a general trend, I think, of businesses directly monetizing, like having their equivalent of direct revenue be more relevant with AI because the inference costs are real. If you are like... Maybe the prior generation of companies were very heavily ad-dominant. Whereas if you look at ChatGPT or Claude or something like that, they have to have the various tiers of subscriptions, $20 a month and $200 a month. Because you can just use a small amount of compute or a lot of compute. Do you see similarly direct revenue becoming a bigger deal for Snap in the future? Because you're just going to have more computationally expensive products? If you're using a lot of computationally expensive Lens Studio stuff, like you can potentially burn a lot of compute as a user of Snap. Yeah. That's one... One consideration for us. I think, of course, we have a Lens+ tier of our subscription service, which gives you access to more of our AI tools and editing tools. I don't think people realize that the Snapchat camera is one of the largest image and video generation platforms in the world, just given the frequency of engagement. One of the ways we do monetize that is with the Lens+ product. But I think for us, if I look at our subscription business, it actually just really aligns with our company's ethos and also our core skill set. If you think about like what Snapchat has been good at over the past decade, it's been making products that people really love. We would always get emails from customers asking for new features, different features, more bespoke features like app themes, for example. We never had the resources to work on it. We were like, "Oh gosh, like we can't build something for a tiny subset of our community," even though they're so passionate about the product and about what we're creating. I think what's been so fun about Snapchat+ is that we've been able to dedicate the resources to build this long list of features that our most passionate Snapchatters really want and are willing to pay for. It really aligns, I think what we love to do, and I think what we do best, which is making cool new products with our community and what they want, which are more bespoke features from us.…

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